Management is pleased to present this financial discussion and analysis of the University of Colorado (the University). It is intended to make the University’s financial statements easier to understand and communicate our financial situation in an open, accountable, and transparent manner. It provides an analysis of the University’s net position and results of operations for the years ended June 30, 2018 and 2017 (Fiscal Year 2018 and 2017, respectively), with comparative information for the year ended June 30, 2016 (Fiscal Year 2016). University management is responsible for the completeness and fairness of this discussion and analysis and the financial statements.

Understanding the Financial Statements

Statements of Net Position present the assets, deferred outflows of resources, liabilities, deferred inflows of resources, and net position of the University at a point in time (June 30, 2018 and 2017). Their purpose is to present a financial snapshot of the University. They aid readers in determining the assets available to continue the University’s operations; how much the University owes to employees, vendors, and lenders, and a picture of net position.

Statements of Revenues, Expenses, and Changes in Net Position present the total revenues and expenses of the University for operating, nonoperating, and other undertakings during the fiscal years ended June 30, 2018 and 2017. Their purpose is to assess the University’s operating and nonoperating activities.

Statements of Cash Flows present cash receipts and payments of the University during the fiscal years ended June 30, 2018 and 2017. Their purpose is to present the sources of cash coming into the University, how that cash was expended, and the change in the cash balance during the year.

Notes to the Financial Statements present additional information to support the financial statements. Their purpose is to clarify and expand on the information in the financial statements.

Required Supplementary Information (RSI) presents additional information that differs from the basic financial statements in that the auditor applies certain limited procedures in reviewing the information. In this report, RSI includes schedules of the University’s proportionate share of the Public Employee’s Retirement Association of Colorado (PERA) pension liability and Other Postemployment Benefits (OPEB) liability, contributions to the PERA pension and OPEB plans, the changes in the Alternate Medicare Plan (AMP) liability and the OPEB liability and related ratios, and this management’s discussion and analysis.

Nonfinancial indicators are also available to assess the overall state of the University. Examples of nonfinancial indicators include trend and quality of applicants, freshman class size, student retention, building condition, and campus safety. Information about nonfinancial indicators is not included in this analysis but may be obtained from the University’s Budget and Finance Office (see www.cu.edu/budgetpolicy/accountability-data-center).

Financial Highlights

Selected financial highlights for the fiscal year ended June 30, 2018 include:

• University assets total $7,006,367,000, deferred outflows of resources (reflecting loss on bond refundings, and certain changes in the PERA pension, AMP and OPEB plans) total $538,756,000, liabilities total $5,672,431,000 and deferred inflows total $220,851,000 (related to the PERA and AMP pensions, OPEB, and other items) resulting in net position of $1,651,841,000. Of this amount, $1,912,493,000 is net investment in capital assets, $48,618,000 is restricted for nonexpendable purposes, meaning only the earnings on the related investments may be used for purposes dictated by the resource provider, and $686,109,000 is restricted for purposes for which the donor, grantor, or other external party intended. The remaining unrestricted balance is a negative $995,379,000. See discussion throughout this Management’s Discussion and Analysis (MD&A) regarding the University’s negative unrestricted net position.
• As discussed in Note 1, the University adopted the provisions of Governmental Accounting Standards Board (GASB) Statement No. 75 Accounting and Financial Reports for Postemployment Benefits Other Than Pensions (Statement No. 75) effective July 1, 2017 which was the first day of Fiscal Year 2018. The University elected to adopt this standard as a cumulative effect in the Fiscal Year 2018 column as information required from PERA for their cost-sharing plan was not available for periods before June 30, 2017. As a result, Fiscal Year 2017 balances reported in this document were not impacted
• The increase in the University’s net pension liability for Fiscal Year 2018 is a result of the increase in the state-wide net pension liability, due to changes in underlying actuarial assumptions made by PERA related to the discount rate.
• In total, operating revenues increased approximately 8.7 percent in Fiscal Year 2018 while operating expenses increased 8.9 percent. For comparative purposes, operating revenues increased 8.5 percent in Fiscal Year 2017 while operating expenses increased 18.1 percent.  The increase in operating expenses is primarily due to changes in PERA assumptions which increased the net pension liability by 7.7 percent for Fiscal 2018 and 74.3 percent for Fiscal 2017.

Statement of Net Position

Figure 1 illustrates the University’s summary of assets, deferred outflows, liabilities, deferred inflows and net position. The mix of assets, liabilities, and net position has remained consistent with the exception of the PERA pension, AMP, and OPEB liabilities. Deferred outflows and inflows of resources and the related liability experienced changes from the prior year. The deferred outflows of resources of $538,756,000 in Fiscal Year 2018, $706,918,000 in Fiscal Year 2017, and $198,126,000 in Fiscal Year 2016 represent the deferred loss on bond refundings, and items related to the PERA pension, AMP, and OPEB liabilities.  These balances fluctuated due to changes in actuarial assumptions made by PERA and the University’s actuary. Analysis of the University’s capital assets and related debt is included in the section Capital Asset and Debt Management, whereas this section provides analysis of the University’s noncapital assets and other liabilities.

Figure 1. Summary of Assets, Deferred Outflows, Liabilities, Deferred Inflows and Net Position as of June 30, 2018, 2017, and 2016 (in thousands)

The University’s investments were $2,779,799,000 and $2,607,441,000 at June 30, 2018 and 2017, respectively, representing an increase of $172,358,000. The University’s investments were $2,607,441,000 and $2,361,851,000 at June 30, 2017 and 2016, respectively, representing an increase of $245,590,000. The increases in investments for both years was primarily due to fair value increases and the issuance of new bonds offset by bond proceeds being liquidated and used for projects.

The increase in net accounts and loans receivable from Fiscal Year 2017 to 2018 of $46,010,000 was primarily due to the University of Colorado Medicine’s (CU Medicine) growth in patient billing. The decrease in net accounts and loans receivable from Fiscal Year 2016 to 2017 of $61,854,000 was primarily due to improvements in the process of sponsored project billing and the related letter of credit (LOC) draws as the University more fully utilized its new finance system.

The University’s non-debt-related liabilities were $3,853,783,000, $3,333,647,000, and $2,274,484,000 at June 30, 2018, 2017 and 2016, respectively. These liabilities are comprised of amounts categorized in Figure 2.

Figure 2. Composition of Non-debt-related Liabilities as of June 30, 2018, 2017, and 2016
(in thousands)

As discussed in Note 15, the University participates in the state-wide PERA cost-sharing defined benefit pension plan. Statement No. 68 Accounting and Financial Reporting for Pensions (Statement No. 68) requires the University to record its “proportionate share” of PERA’s net pension liability. The University has no legal requirement to pay this liability in the event of PERA’s insolvency nor does it have the ability to determine the employer or employee annual contributions. The liability cannot be prepaid. Per PERA’s Fiscal Year 2017 Comprehensive Annual Financial Report (CAFR), PERA’s net pension liability for the state division in which the University participates is $20,017,982,000. The University’s proportionate share of the liability based on calendar 2017 contributions is $2,206,541,000. While the net pension liability increases total liabilities, decreases unrestricted net position, and increases pension expense, associated cash flow out of the University remains fixed by the contribution levels set in State statute (see Figure 7).  For PERA’s 2016 CAFR, the net pension liability was $18,368,131,000 and the University’s proportionate share of the liability was $2,049,366,000.  The majority of the $1.6 billion increase can be attributed to a change in assumptions, which required using a blended discount rate 4.72 percent in Fiscal Year 2018 and 5.26 percent in Fiscal Year 2017, instead of the 7.25 percent estimated rate of return.

The University is required to account for and report on OPEB Note 7. Such benefits include health insurance benefits for University retirees and their dependents. The University has chosen to fund this liability on a pay-as-you-go basis; therefore there are no assets held in trust to pay future benefits which have been earned by employees. Statement No. 75 is effective for Fiscal Year 2018 and requires the full recognition of the liability to employees for OPEB. Therefore, the existence and amount of this balance should be considered in determining future resource demands on the University. In addition, University employees in PERA can elect to participate in the PERACare program for other postretirement benefits, so the University is required to record its proportionate share of PERA’s net OPEB liability.  As noted in Figure 2, the liability required to be reported in the financial statements totaled $795,147,000 in Fiscal Year 2018, $746,773,000 from the University’s OPEB plan and $48,374,000 from PERA’s OPEB plan. The cumulative impact of adopting the standard for both plans was a $507,608,000 reduction to unrestricted net position (see Note 1). In Fiscal Year 2017, the University followed the provisions of GASB Statement No. 45 Accounting and Financial Reporting by Employers for Postemployment Benefits Other Than Pensions, as amended (Statement No. 45). The liability for OPEB totaled $343,570,000 in Fiscal Year 2017, an increase of $54,437,000 from Fiscal Year 2016. This increase is primarily due to the annual required contributions of $74,105,000 and $65,667,000 in Fiscal Year 2017 and 2016, respectively, offset by pay-as-you-go amounts of approximately $14,929,000 and $14,350,000 for Fiscal Year 2017 and 2016, respectively, which were the reporting requirements under Statement No. 45.

Compensated absences estimate the amount payable to employees in the future for their vested rights under the University’s various leave programs. This estimate is based on personnel policies that define the amount of vacation and sick leave to which each employee may be entitled Note 1. Compensated absences typically increase year-over-year as employees accrue additional vacation days and salaries change.

Unearned revenue represents amounts paid by students, auxiliary enterprise customers, grantors, and contractors for which the University has not met all of its requirements for revenue recognition Note 8. These amounts will be recognized as revenue in future periods after all conditions have been satisfied. The unearned revenue balance fluctuates from year to year depending on factors such as the timing of the first day of classes and the rate of spending on grants and contracts for which payment has been received in advance.  In Fiscal Years 2018, 2017 and 2016, University of Colorado Boulder’s (CU Boulder) Laboratory for Atmospheric and Space Physics (LASP) received an advanced-pay sponsored project of which $23 million, $47 million and $39 million, respectively, was unearned at year-end.

Accrued expenses in Fiscal Year 2017 and Fiscal Year 2016 include the year-end accruals of the University’s June payroll, which was not paid until July due to State law.  The decrease in the liability in Fiscal Year 2018 is due to a change in interpretation in State law resulting in Higher Education institutions paying June 30 monthly payroll on the normal schedule.

As permitted by GAAP, the University historically recorded the federal share of the Perkins Fund in restricted net position. With the expiration of the Perkins Loan Program, the University is required, beginning in Fiscal Year 2018, to reflect the federal share as a liability. Therefore, the University recorded a liability of $20,341,000 and a related expense of the same amount in the Fiscal Year 2018 financial statements Note 10.

The University’s net position may have restrictions imposed by external parties, such as donors, or include items that, by their nature are invested in capital assets (property, plant, and equipment) and are therefore not available for expenditure or debt repayment. To help understand these restrictions, the University’s net position is shown in four categories, as displayed in Figure 1.

A portion of net position is restricted for either expendable or nonexpendable purposes. This portion is then more specifically delineated by programmatic restrictions. The programmatic category of the restriction is shown on the statement of net position. A nonexpendable restriction requires the original principal to be set aside for perpetual investment (as an endowment). The majority of the endowment assets benefiting the University are held by the University of Colorado Foundation (CU Foundation), which is a discretely presented component unit Note 17 and not included in the above amounts. An expendable restriction allows the University to spend the full amount, but only for the purposes identified by the entity providing the money. Unrestricted net position, as defined by GAAP, is available for spending for any lawful purpose under the full discretion of management. However, the University has placed internal limitations on future use by designating unrestricted net position for certain purposes in keeping with management’s plans to manage resources Note 11.

In Fiscal Year 2018 total restricted for nonexpendable net position decreased by $9,722,000 due to several endowments being transferred to the CU Foundation pursuant to Regent policy and to promote administrative efficiency in stewarding University funds.

As noted earlier, due to the PERA and OPEB pension liabilities, the University’s unrestricted net position is negative.  This means the University’s total liabilities and deferred inflows of resources are greater than its assets and deferred outflows of resources. See “Economic Factors That Will Affect the Future” for further discussion.

Statement of Revenues, Expenses, and Changes in Net Position

Figure 3 illustrates the University’s summary of revenues, expenses, and changes in net position. A key component of this summary is the differentiation of operating and nonoperating activities. Operating revenues are received for providing goods and services to the various customers and constituencies of the University. Operating expenses are paid to acquire or produce goods and services provided in return for operating revenues and to carry out the mission of the University. Nonoperating revenues/expenses include items determined not to fall in the operating category.

The special item in Fiscal Year 2017 is due to the transfer of operations from the University of Colorado Real Estate Foundation (CUREF) to the University and to the University of Colorado Property Corporation (CUPCO), a blended component unit of the University, in accordance with GASB Statement No. 69 Government Combinations and Disposals of Government Operations (Statement No. 69).

In Fiscal Year 2018, the cumulative effect of adoption of new accounting principle relates to the implementation of Statement No. 75 and Statement No. 81 Irrevocable Split-Interest Agreements (Statement No. 81).  See Note 1 for further detail.  In Fiscal Year 2017, the cumulative effect of adoption relates to the implementation of GASB Statement No. 73 Accounting and Financial Reporting for Pension and Related Assets that are not within the Scope of GASB Statement No. 68, as amended (Statement No. 73).

Figure 3. Summary of Revenues, Expenses, and Changes in Net Position for Years Ended June 30, 2018, 2017, and 2016 (in thousands)

Figure 4. Operating and Nonoperating Revenues (Excluding Capital) for Years Ended June 30, 2018, 2017, and 2016 (in thousands)

Operating Revenues (in thousands)

The University experienced increases in all operating revenue sources in Fiscal Year 2018. The increases in tuition and fee revenue for Fiscal Years 2018 and 2017 reflect a combination of changing enrollment and rate increases. In Fiscal Year 2018 and 2017, enrollment increased by 3.4 percent and 3.6 percent, respectively. In Fiscal Year 2018, approved tuition rates increased 4.9 percent at CU Boulder, 4.0 percent at the University of Colorado Colorado Springs (UCCS), and 3.2 percent at the University of Colorado Denver (CU Denver). In Fiscal Year 2017, the increases were 4.9 percent, 3.8 percent, and 3.6 percent, respectively. At the University of Colorado Anschutz Medical Campus (CU Anschutz), tuition rates increased 3.7 percent in Fiscal Year 2018 and the rate increased 5.1 percent in Fiscal Year 2017.

In Fiscal Years 2018, 2017 and 2016, the University applied $67,612,000, $64,661,000, and $63,175,000, respectively, of COF stipends against student tuition bills (these amounts are included in tuition revenues). Fee-for-service revenue from the State increased $4,834,000 between Fiscal Year 2018 and 2017, and $432,000 between Fiscal Year 2017 and 2016, due to the State budget.

Consistent with the University’s goal to increase its focus and national role as a comprehensive research institution, one of the three largest sources of revenue for the University continues to be grants and contracts revenue, which includes funding from federal, state, and local governments, and private sources. Grants and contracts revenue from the federal government represents 73 percent, 74 percent and 77 percent of total grants and contract revenue for Fiscal Year 2018, 2017 and 2016, respectively. Each grant or contract is restricted in use to the purpose given and limited to the cost principles specified by each sponsor. The increase in recent years is due to the addition of several sponsored project awards from federal sponsors such as the National Aeronautics and Space Administration (NASA), National Institute of Standards and Technology (NIST) and National Institutes of Health (NIH). These grants also provide necessary funding for the administrative functions and facilities that support the grants through the facilities and administrative reimbursement. In Fiscal Years 2018, 2017 and 2016, the University received $206,315,000 , $182,846,000 and $180,353,000, respectively, of such administrative and facility overhead cost reimbursements. The University pledges portions of this reimbursement revenue and other auxiliary revenues to satisfy its bond obligations, which are commonly referred to as pledged revenues, thus creating a reliance on continued federal research funding.

The increase to auxiliary enterprise revenues in Fiscal Year 2018 and Fiscal Year 2017 is due to an increase in student body, affecting housing, dining, and food services at UCCS, where the food service is not outsourced. At CU Boulder, the increases were due to Housing & Dining Services (HDS) room and board and meal revenue, bookstore revenue, and athletics revenue.

The majority of health services revenue includes medical practice plan revenues earned through CU Medicine (Note 1 and Note 16), which has experienced growth in operating revenue of 18.7 percent in Fiscal Year 2018 and 12.6 percent in Fiscal Year 2017. Patient services revenue contributed the majority of the operating revenue increase which was driven by a 7.6 percent in Fiscal Year 2018 and 8.5 percent in Fiscal Year 2017 growth in clinical volumes and ongoing efforts to maximize reimbursement rates for commercial insurance. The increase in Fiscal Year 2018 was also driven by participation in the Upper Payment Limit (UPL) program which allows for appropriations for specialty education services provided by CU Anschutz to be used for Medicaid reimbursement.

Gifts increased $17,337,000 between Fiscal Year 2018 and 2017 mainly due to the School of Medicine (SOM) which received support gifts for various research programs as well as increased gifts to CU Boulder for Leeds School of Business, Athletics, College of Engineering, and Biofrontiers Institute.  Gifts increased $6,123,000 between Fiscal Year 2017 and 2016 mainly due to supporting Transformational Research funding and the National Behavior Health Innovation Center at CU Anschutz.

Investment income net of investment expense was $160,106,000 in Fiscal Year 2018, $206,294,000 in Fiscal Year 2017, and $18,516,000 in Fiscal Year 2016. Investment income is subject to inherent variability due to the requirement to record the majority of investments at fair value. In Fiscal Year 2018, the University’s unrealized gains on investments (the difference between the investment’s fair value and cost basis) increased by $64,992,000. In Fiscal Year 2017, the University’s unrealized gains on investments increased by $125,538,000.

In addition to operating and nonoperating revenues, the University had capital revenues in the amounts depicted in Figure 5.

Figure 5. Capital Revenues for Years Ended June 30, 2018, 2017, and 2016 (in thousands)

The University received appropriations from the State of $3,643,000 in Fiscal Year 2018 compared to $33,441,000 in Fiscal Year 2017 and $24,860,000 in Fiscal Year 2016. These monies are used for various controlled maintenance and other capital construction activity and fluctuate year to year based on the State budget.

Capital grants and gifts increased $6,844,000 in Fiscal Year 2018 primarily due to gifts for supporting construction costs of the Student Wellness Center and the Jake Jabs Event Center in the Business School building at CU Denver, and a gift for the construction of the 5th wing of CU Boulder’s Jennie Smoly Caruthers Biotechnology Building.  Capital grants and gifts were consistent from Fiscal Year 2016 to Fiscal Year 2017.

The programmatic uses of resources are displayed in Figure 6 and demonstrate that the focus is basically unchanged over the past three fiscal years. Total educational and general programs overall have grown by 7.1 percent and 13.1 percent in Fiscal Year 2018 and 2017, respectively. The increase in academic, institutional, and plant support is related to the increases in instruction. The increase in instruction is partly due to the increased number of students and general increases in the cost of education. The increase in research expenditures in Fiscal Year 2018 is mainly due to sponsored research expenditures, focused in Laboratory in Atmospheric Space Physics (LASP), Cooperative Institute for Research in Environmental Sciences and Physics (CIRES), Joint Institute for Laboratory Astrophysics (JILA), and Renewable and Sustainable Energy Institute (RASEI) at CU Boulder and the NIH at the CU Anschutz as well as private projects for clinical trials. The Fiscal Year 2017 increase in research expenditures related to increased nongovernmental grants and contracts within LASP. In addition, pension expense increased $81,090,000 and $312,412,000 in Fiscal Year 2018 and Fiscal Year 2017, respectively, which was allocated across the various expense program categories based on the related payroll.

Figure 6. Expense Program Categories for Years Ended June 30, 2018, 2017, and 2016 (in thousands)

Operating Expenses (in thousands)

The expense totals in Figure 6 above include PERA pension expense. Figure 7 demonstrates the impact of the changes made to PERA’s actuarial assumptions to the University’s Fiscal Year 2017 and 2018 financial statements. As can be seen in the chart below, pension expense increased $20,645,000 in Fiscal Year 2016, prior to the changes made by PERA to its actuarial assumptions. In Fiscal Year 2017, pension increased by $312,412,000, and in fiscal year 2018, pension expense increased $81,090,000. These increases (and corresponding increase in net pension liability) should be compared to the required cash contributions for each of the Fiscal Years 2016, 2017, and 2018 of $54,561,000, $58,698,000, and $61,138,000 respectively.

Figure 7. PERA Pension Expense Compared to Required Contributions (in thousands)

The amounts shown for student aid do not reflect the actual resources dedicated to student aid. The majority of the University’s student aid resources are netted against tuition, fee, and auxiliary revenue as a scholarship allowance Note 13. The University’s scholarship allowance was $222,097,000, $200,664,000 and $187,250,000 in Fiscal Year 2018, 2017 and 2016, respectively.

Increases in expenses related to health services, which are primarily related to CU Medicine, are consistent with the associated increases in health services revenue discussed earlier in this section.

Capital Assets and Debt Management

The University had $5,982,074,000, $5,726,536,000 and $5,352,014,000 of plant, property, and equipment at June 30, 2018, 2017 and 2016, respectively, offset by accumulated depreciation of $2,378,983,000, $2,195,974,000 and $1,993,423,000, respectively. The major categories of plant, property, and equipment at June 30, 2018, 2017 and 2016 are displayed in Figure 8. Related depreciation charges of $206,950,000, $202,938,000 and $181,191,000 were recognized in the Fiscal Years 2018, 2017 and 2016, respectively. Detailed financial activity related to the changes in capital assets is presented in Note 5. Figure 9 details the University’s current construction commitments.

Figure 8. Capital Asset Categories (before depreciation) as of June 30, 2018, 2017, and 2016 (in thousands)

Figure 9. Current Construction Projects as of June 30, 2018

During Fiscal Year 2017, the University issued $66,930,000 in revenue bonds with proceeds being allocated to refunding a portion of certain outstanding obligations and paying costs relating to the issuance of the Series 2017A Bonds. In addition, $53,735,000 of bonds was assumed as part of a newly formed blended component unit.

At June 30, 2018, 2017 and 2016, the University had debt (or similar long-term obligations) of $1,778,648,000, $1,680,196,000 and $1,691,046,000, respectively, in the categories illustrated in Figure 10. More detailed information about the University’s debt is included in Note 9.

Figure 10. Debt Categories as of June 30, 2018, 2017, and 2016 (in thousands)

In addition, during Fiscal Year 2018 the Regents authorized a commercial paper program for approved capital construction projects with a maximum outstanding amount of $200 million.  This short-term financing has a fixed maturity of less than 270 days from issuance.  During Fiscal Year 2018, the University issued $40 million of commercial paper to fund construction projects at CU Boulder with an initial interest rate of 1.3 percent.

The University minimizes financing costs by monitoring current market conditions and by maintaining a bond rating of Aa1 and AA+ and commercial paper ratings of P-1 and F1+ (Moody’s and Fitch, respectively).

Economic Factors that Will Affect the Future

The Fiscal Year 2019 budget approved by the State Legislature included a $59.1 million statewide increase for higher education operations which includes $18.9 million additional funding for the University through the higher education allocation model. The budget for the University for Fiscal Year 2019, as approved by the Regents, increased approximately $228,250,000, or 5.3 percent.

Due to the nature of funding for public institutions of higher education, operating losses are normal. Colorado is unique in that the majority of funding from the state comes in the form of stipends paid directly to students and from fee-for-service agreements in which the state pays its public higher education institutions for providing certain agreed-upon educational activities. Unlike regular state appropriations, stipends and fee-for-service revenues are included in operating revenue. This difference in funding models between Colorado and the remainder of the country is a consideration when comparing results between the University and out-of-state peers.

As discussed in previous years’ MD&A, the University’s operating loss continues to increase. For Fiscal Year 2018, the operating loss was $616,419,000, up from a loss of $559,424,000 in Fiscal Year 2017. For the second consecutive Fiscal Year, the University incurred a negative change in net position of $197,258,000 (prior to the impact of the adoption of Statement No. 75) compared to a negative change in net position of $107,943,000 in Fiscal Year 2017. The cause of the operating losses, negative change in net position, and the increases in both are directly attributable to the change in assumptions made by PERA in prior years to the state-wide defined-benefit pension plan. These changes added approximately $81,090,000 and $312,412,000 to operating expense in Fiscal Years 2018 and 2017. It is important to note that the changes in assumptions made by PERA do not have an impact on the University’s cash flows, as contribution rates for employers and members remained unchanged.

As discussed in Note 15 to the financial statements, Retirement Plans and Insurance Programs, the Colorado General Assembly passed pension reform through Senate Bill 18-200 Concerning Modifications to the Public Employees’ Retirement Association Hybrid Defined Benefit Plan Necessary to Eliminate with a High Probability the Unfunded Liability of the Plan Within the Next Thirty Years (the Bill). The Bill was signed into law by Governor Hickenlooper on June 4, 2018.  The Bill makes changes to the plans administered by PERA with the goal of eliminating the unfunded actuarial accrued liability and thereby reach a 100 percent funded ratio within the next 30 years.