Justus v. State
Colorado Supreme Court
336 P.3d 202, 2014 Colo. 75 (2014)
- Written by Mike Begovic, JD
Facts
The Colorado Public Employee’s Retirement Association (PERA) program was created to provide retirement benefits to Colorado public employees. Under PERA, beneficiaries received a monthly base benefit calculated using a formula. In 1969 the Colorado General Assembly enacted provisions authorizing a supplemental cost-of-living adjustment (COLA) to increase beneficiaries’ overall benefits. The legislature made several adjustments to COLA over the years. From 2001 to 2009, the base COLA was capped at 3.5 percent compounded annually. In 2009, amid concerns that the program was severely underfunded, the Colorado General Assembly took measures to scale back COLA, capping the annual increase at 2 percent of the retiree’s base retirement benefit. Gary Justus and others (the retired employees) (plaintiffs), a group of retired public employees, contended this scaling back violated a contract they had entered into with the state (defendant). The retired employees filed suit to nullify the COLA changes. The district court granted summary judgment to the state on the ground that no such contract existed. The court of appeals disagreed, finding a contractual right existed, and remanded the case for further review. The Colorado Supreme Court undertook certiorari review to address the question.
Rule of Law
Issue
Holding and Reasoning (Hobbes, J.)
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