Phoenix pension reform proponents turn in 54,000 signatures to ensure their initiative goes on the ballot
By Josh Altic
On March 11, 2014, the Phoenix group Citizens for Pension Reform turned in over 54,000 signatures, which is more than double the 25,480 valid signatures required to put its initiative - one which drastically reforms the Phoenix public pension system - on the ballot. Moreover, the Citizens for Pension Reform Committee double checked the petitions with the city of Phoenix's own voter lists to ensure the validity of the submitted signatures, leaving little doubt that the initiative will qualify for the ballot. Once signatures are verified and the petitions are certified by the Phoenix City Clerk, the city council has 25 days to put the initiative on an election ballot. The remaining special election dates allowed by state law in 2014 are May 20, August 26 and November 4.
Scot Mussi, chairman of the committee behind the initiative, said, "The outpouring of support from Phoenix residents wanting real pension reform has been tremendous. The power brokers at City Hall have refused to fix our broken pension system, instead passing sham reforms thinking they can hide the problem from taxpayers. Voters are fed up with the games and deserve an opportunity to decide the issue for themselves."
The Pew Charitable Trust conducted a study in 2009 that estimated the Phoenix public employee retirement system had $5.115 billion in debt and that $1.399 billion of this fund was not backed by city assets, leaving the retirement fund only 73% solvent. The city of Phoenix 2013 Actuarial Value Report showed that the unfunded liabilities of the city's pension system had grown to $1.5 billion, with the system having plummeted to 56% funding. Moreover, the pension costs of the city have risen by 40% since 2011, resulting in a 2013 payment of $253 million.
The proposed initiative seeks to change the city's retirement system from a defined benefit system, in which retirees are guaranteed payments despite low investment performance, to a 401(k)-style defined contribution plan, in which the city contributes a set amount, and the retiree's benefits depend on his or her own contributions and investment performance. It would also take steps to put a stop to pension spiking by implementing limits on the pensionable salaries of current employees.
- City of Phoenix Pension Reform Initiative, Proposition 487 (November 2014)
- Local pensions on the ballot
- Ahwatukee Tea Party, "Phoenix Pension Reform Act Files Petition Signatures," March 11, 2014
- Ballotpedia, "Laws governing local ballot measures in Arizona," accessed March 12, 2014
- Phoenix City Elections Department website, "Scheduled City of Phoenix Elections," accessed March 12, 2014
- Pew Charitable Trusts, "Cities Squeezed by Pension and Retiree Healthcare Shortfalls," March, 2013
- Phoenix Pension Pension Reform Act website, accessed March 12, 2014
- Azcentral.com, "Phoenix pension ‘spiking’ rules vary for city employees," September 14, 2013
- Pew Charitable Trust, "A Widening gap in Cities," January, 2013
- Arizona Free Enterprise, "Stop Pension Abuse," accessed January 30, 2014