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Colorado Saves Millions After Pension Program Change

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Inside the Colorado Legislature (credit: CBS)

Inside the Colorado Legislature (credit: CBS)

DENVER (AP) – Colorado is saving millions of dollars since lawmakers changed the rules for a pension program a year ago.

A loophole previously allowed immigrants to immediately enroll in the state’s Old Age Pension after joining relatives in Colorado. The 2010 law imposed a five-year residency requirement.

The Denver Post reported Sunday that Colorado spent $77.5 million on monthly cash benefits under program in the fiscal year that ended in June, down $11.6 million or 13 percent from the year before.

The change pushed thousands of people off the rolls, including some who were paid the highest cash benefit allowed.

“They were the ones that had represented a disproportionate size of the overall caseload,” said Dan Daly, director of the Colorado Department of Human Services division of aging and adult services.

The program provides more than 23,000 low-income Colorado residents who are at least 60 years old with cash benefits of up to $699 per month. Some also get medical benefits.

“I think it’s important we provide help to people who have nothing,” said former state Rep. Jack Pommer, D-Boulder, who tried to change the program in 2010 but backed off because of opposition from fellow Democrats.

“But when people who have money are using this to essentially supplement their own income, I thought that was worth reforming,” he said.

The Colorado Center on Law and Policy, a liberal research group, wanted the state to grandfather in immigrants who came in under the old rules.

“They cut people off who were on the program,” said Adela Flores-Brennan, an attorney with the group. “I feel like that’s a really harsh outcome.”

Federal law requires a person who sponsors an immigrant to pledge to be responsible for the immigrant.

But Colorado’s program, which voters added to the state constitution in 1936, says the income of the recipient’s family can’t be considered in determining eligibility for the program.

State officials said the result was that some people living in Colorado sponsored their elderly parents as immigrants, telling the federal government they will care for their relatives but signing up the family member for the Old Age Pension.

The five-year residency requirement aligns the program with federal law, which imposes the same waiting period to receive federal benefits.

Haley McKean, a spokeswoman for the Arapahoe County Department of Human Services, said officials knew that the program was sometimes abused.

“(Recipients) were able to take the county’s funding for those benefits and move back to another state or to another country and use those benefits from afar,” she told The Post. “We saw fraud.”

The original amendment required recipients to be U.S. citizens, but a court struck that provision down, making legal permanent residents eligible.

(Copyright 2011 by The Associated Press. All Rights Reserved.)

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