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Voters approve changes to public safety pensions

Hank Stephenson//May 17, 2016

Voters approve changes to public safety pensions

Hank Stephenson//May 17, 2016

pension-620

Arizona’s dangerously underfunded public safety pension system will undergo a substantial reform after voters approved Proposition 124 in Tuesday’s special election.

With nearly all the votes counted, the measure was cruising to an easy victory Wednesday with more than 70 percent of voters supporting the measure.

“I don’t know who those 29 percent of the people who voted no are, but maybe they just vote no on everything,” joked the reform package’s sponsor, Republican Sen. Debbie Lesko of Peoria.

The proposed overhaul would make a number of changes to the Public Safety Personnel Retirement System, which covers police and fire fighters.

The plan voters approved would cap increases to cost-of-living payments, evenly split pension costs between employees and employers, divides public safety employees into different categories based on their date of hire, and crack down on the practice of pension spiking, among other changes.

Lawmakers referred the issue to the ballot after years of negotiating with police and firefighters unions over a way to reform the pension system.

Though the Republican-controlled Legislature has frequently been at odds with public sector unions, the two sides this year reached a near unanimous agreement on the overhaul, and lawmakers easily passed the three-piece proposal out of both chambers.

Gov. Doug Ducey signed two of the reform bills into law. But because the three-piece legislative package included a reduction in benefits for current police officers and firefighters, which is protected in the Arizona Constitution, that portion of the package required voter approval.

Bryan Jeffries, president of the Professional Fire Fighters of Arizona, said the overwhelming support the proposition received is a credit to the process by which the plan was crafted – conservative lawmakers and public safety unions sat down together to find a plan that both sides could live with.

“It speaks volumes to the process when people see us coming together. They say, ‘Hey, this is how government is supposed to work,’” Jeffries said, following the release of early election results on Tuesday night.

“I’m so proud of our police and fire fighters. We didn’t cause this problem, but our folks were willing to step up and swallow this bitter pill to make the system sustainable,” he added.

Lesko described the Public Safety Personnel Retirement System as dogged by fiscal unsustainability, broken and on the precipice of bankruptcy as pension costs are spiking and related debts are piling up.

She argued her legislation will save cities and the state untold millions over the coming decades and finally put the pension system on the path of fiscal stability.

On Tuesday, she said she was thrilled with the results of the special election.

“I’ve been told where it’s the first time in the nation where conservatives worked together with police and firefighters unions where everyone came together to work for a reform… It’s a win-win,” she said.

The Arizona Tax Research Association was the major voice against the package at the Capitol, arguing that the reform doesn’t go far enough and the projected savings won’t materialize.

But on the campaign trail, the constitutional change went unopposed. No political committee formed to urge a vote against the measure, and nobody filed a single argument against the issue in the election publicity pamphlet.

Lesko said the reform has been such a success that she’s already been asked to speak about the compromise reform process at some national conferences, including the ALEC conference in July.

“I’ll be on the roadshow talking about pension reform,” she said.

And Lesko already has her sights set on another pension system that needs reforming. She said her next pension project will be reforming the Corrections Officer Retirement Plan.