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Home / election 2018 / 2018 Ballot Measures / Prop. 125 / Retirement board endorses ‘yes’ vote on Prop 125

Retirement board endorses ‘yes’ vote on Prop 125

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Current and former public employees are being informed at state expense that the board that oversees their retirement plan wants people to vote in favor of Proposition 125.

The email, sent Monday to more than 30,000 recipients, explains the effects of proposed changes in pension plans for elected officials and correctional officers, specifically in cost-of-living adjustments. Those changes, if approved by voters, are designed to put the plans on more financially sound footing.

But the email not only says that approval of the measure “helps protect the middle class retirement promised” to current and retired state employees. It also spells out that the board has endorsed a “yes” vote on the measure.

Christian Palmer, spokesman for the pension system, said the email is not an improper use of public resources.

“Our board is appointed,” he said, with its members not employed or paid by the state. That, he said, leaves them free to take public positions on ballot measures.

And Palmer said the fact that the email was sent out by state employees using a state-owned email list does not run afoul of the law. Anyway, he said, nothing in the email actually tells recipients they should vote for Proposition 125.

“It’s purely informational,” he said.

Earlier this year lawmakers approved two measures designed to replace the current system of determining annual pension benefit increases with a formula tied to changes in the cost of living in the metropolitan Phoenix area. Both were designed to improve the financial stability of the retirement plans.

The issue is on the ballot because the Arizona Constitution provides that benefits for public retirement systems cannot be diminished or impaired. And the Arizona Supreme Court has ruled that means no changes for anyone already in the system.

Proposition 125 would create an exception to that provision.

The measure has only token opposition — if that. In fact, the only statement urging a “no” vote put into the pamphlet sent to voters about all the ballot proposals came from Eric Hahn, a retired Pima County corrections officers, who said it is “unfair” to change the plan for those who were hired under the old rules.

Palmer, however, said the board that oversees the retirement plans took a vote to support — and directed  that he send out the message conveying that support.

“Our board of trustees has asked that we take a role in spreading information about this measure,” he said. Palmer said this is no different than two years ago when the board actively supported Proposition 124 which made similar changes to the pension system that covers police and firefighters.

And Palmer said sending out an email saying the board has “endorsed a ‘yes’ vote on Proposition 125” is not electioneering.

Palmer said that the email is designed to inform members of the elected officials and corrections officers retirement plans about the potential financial effects of approving the measure. It changes from benefit increases linked to the return on the fund’s investment to one based on inflation.

That verbiage also includes assurances that, “with very rare exceptions,” the U.S. Department of Labor recognizes inflation every year.

“This makes if very probable that a COLA will be implemented each year for retirees,” the email states.

But the email went out not only to those in the two affected retirement plans but also to those in the public safety retirement plan whose benefits will be unaffected, regardless of whether Proposition 125 is approved or not.

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