The cost-of-living adjustment (COLA) for SBCERA payees was approved at 2% by the Board of Retirement at its meeting on February 7, 2008. Annual COLA is determined by comparing the December consumer price index (CPI) in each of the past two years for the Los Angeles-Riverside-Orange County area.
The local region change as of December 2007 was 4.17%– that’s 4.0% when rounded to the nearest half-percent in accordance with the ’37 Act (§31870). Also in accordance with §31870, the COLA that SBCERA can apply annually is capped at 2%. The additional 2.0% is banked so if the future annual CPI change is less than 2%, a percentage is taken from the COLA bank to make payees whole to the 2% cap.
Therefore, members who retire on or before April 1, 2008, are entitled to a 2% COLA this year.