In September 2009, one year after the failure of Lehman Brothers Holdings, Meredith Williams left his office in Denver to travel around Colorado with the board of trustees of the state’s Public Employees’ Retirement Association, stopping in eight cities to meet with active and retired members. The pension plan had suffered monumental investment losses during the financial crisis — $11 billion, or 26 percent of its portfolio — and its funding ratio (based on the market value of assets) had tumbled to 52.7 percent. The pension had been fully funded at the start of the decade, prompting legislators to grant generous benefit increases and reduce contributions, but with the severe drop in asset values, “suddenly the plan was not sustainable for the long term,” says Williams, executive director of Colorado PERA.

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