Arizona Senate OKs police and fire pension plan overhaul

  • Source: Arizona Daily Sun
  • Published: 02/05/2016 03:54 AM

The full Arizona Senate on Thursday unanimously approved a proposal overhauling the state's badly underfunded public safety worker pension plan, sending the package to the House for action. The Senate's rapid-fire action came without debate. All three of the bills enacting the overhaul passed on 28-0 votes. If the House and Gov. Doug Ducey follow the Senate in approving the package, voters will be asked to approve the deal in May, because current retiree cost-of-living adjustments would be lowered under the plan from 4 percent a year to a maximum of 2 percent. The issue is pressing because public agencies have seen contribution rates to the Arizona Public Safety Personnel Retirement System soar to make up for the underfunding. Peoria Republican Sen. Debbie Lesko negotiated the deal with public safety unions and employers across the state, making good on a promise she made a year ago. "I had told the governor and his staff a number of months ago my goal was to pass major pension reform and do it unanimously," she said as she explained her vote. "And I got some laughs and I got some chuckles. But hey, I think we're going to get it done." House passage isn't as clear, as rumors of opposition have been rampant around the Capitol in recent days, even though more than half the members are signed on as sponsors. Speaker David Gowan said Thursday that House members were still poring over the details of the bills, but he expects action next week. He said reform of the system is vitally needed, and he is working to build consensus on the proposal. Lesko said earlier in the week she would not jeopardize a complex agreement by allowing major changes. She wants the bills on Ducey's desk by Feb. 15 in order to be placed on the ballot at a previously set May 17 special election on education funding. Besides changes to cost-of-living adjustments, major provisions include a new tier for newly hired police and firefighters that limits maximum pension payments and requires employers and employees to share equally in payments to retirement accounts. New hires also would be given a choice of opting for a 401(k)-style retirement plan rather than a plan with a guaranteed pension. Current employees pay about 11 percent of their pay into the retirement plan, but employer contributions aren't capped.



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