City of Tucson Pension Reform Initiative, Proposition 201 (November 2013)
A City of Tucson Pension Reform Initiative may be on the November 5, 2013 ballot for voters in the City of Tucson in Pima County, Arizona. Initiative organizers turned in 23,364 signatures on the morning of July 2, which will likely yield far more than the 12,730 valid signatures required.
Supporters of the initiative refer to it as the Sustainable Retirement Benefits Act.
If adopted by the city's voters, the initiative will amend chapter XXIII of the Tucson City Charter. Currently the city operates on a defined benefit plan in which employees contribute a portion of their income and are guaranteed a fixed retirement check. If the city's investments do not earn enough to provide these benefits, the city taxpayers make up the difference. Under the plan proposed by this initiative measure, new non-public-safety employees would have a defined contribution plan, in which they would still put money into their retirement funds, but their benefits would depend on how much they contribute and how successful the city's investments are.
The city has a $940 million retirement fund, which is currently underfunded by 37%. Regina Romera, the vice-mayor of Tucson, said in May 2013 that the city is facing a $15 million budget gap due to the escalating cost of retirement benefits. She also indicated that the city's pension expenses have increased by about 250 percent since 2003 and that it is leaving 1,000 city positions unfilled because of its pension obligations.
Supporters say that the changes they are proposing will protect the retirement benefits of current retirees, while establishing city contribution caps for new city hires to protect taxpayers against ballooning pension and health benefit costs.
Text of measure
|“||An initiative measure amending the Tucson City Charter, chapter XXIII, relating to pension funds and adopting the sustainable retirement benefits act; protecting the rights of current employees in the Tucson Supplemental Retirement System; providing a retirement plan for future hires; providing for future termination of Tucson Supplemental Retirement System when it has no more participants or liabilities.||”|
Click here for the full text of the initiative measure.
The proposed pension reform initiative is sponsored by a group called "The Committee for Sustainable Retirement in Support of Initiative Petition Number 2013I004 and in Support of the Ballot Measure". The president of the committee is Joseph Larusso and the treasurer is Jack Heather. The initiative procurers are Ronald Michaels, Peter Zimmerman and Carol Zimmerman.
Arguments in favor
Supporters argue that the defined benefit plan currently in force in the City of Tucson is not sustainable. They say that in order to make up the 37% shortfall in the current plan, the city will either have to hike taxes on city residents or cut city services. Supporters also argue that their proposed initiative will provide a sustainable option for the city similar to many found in the private sector that will provide benefits to city employees without putting taxpayers or the city in financial danger.
Zimmerman said: "In our mind, everybody wins on this thing. The employees will still have their pensions and it will save taxpayer money in the long run and we won't have to cut city services if people don't want to raise taxes."
Through early July 2013, these donations have been received by the Committee for Sustainable Retirement Benefits:
Arguments in opposition
Some city officials are concerned that if this initiative is approved, it will put a financial strain on the city because under the initiative, pension payouts to current employees and retirees must still be made from the city's retirement fund, but new hires would no longer be contributing to this fund. City Councilman Steve Kozachik wrote the following in an email about the initiative: "No two pensions are alike in terms of the demographics of the participants. What this group is doing is proposing a one-size-fits-all solution in several different states. I've looked at the petition language and the fundamental question it leaves unanswered is how they're going to protect the General Fund from collapsing under the weight of people opting out of the current plan. You don't kill the patient in order to cure the disease. Unless they can explain how collapsing the system is going to save it, I'm not on board with what they're proposing."
Path to the ballot
On the morning of July 2, petition organizers turned in 23,364 signatures, which must now be validated within 20 days by the city clerk. After this, the Pima County recorder has 15 days to verify the results of the city clerk. Supporters expect this process will yield enough valid signatures to put them well over the 12,730 required to qualify their initiative for the November 5, 2013 ballot. Reacting to the abundant signatures gathered, Zimmerman said, "We had a very good response from the public. They are anxious to see some resolution to this issue."
The Committee for Sustainable Retirement Benefits spent roughly $90,000 on its effort to collect the approximately 23,000 signatures it submitted to qualify the measure for the ballot. This comes to about $3.91/signature. For statewide initiatives in Arizona in 2012, the average signature cost for signatures on initiative petitions was $3.70.
Some signatures to qualify the measure for the ballot were collected by Zimmerman and Associates, which is a paid petition drive management company. Before signatures were turned in Zimmerman said that, although there was a tight deadline, he believed the petition would be successful since there had been 12 paid circulators collecting signatures since June 1.
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Details of the citizen initiative process in Tucson:
The City of Tucson is a charter city. Section 1(8) of Article IV and Section 2 of Article XIII of the Arizona Constitution establish procedures for amending city charters for any charter city in Arizona.
Article IV says (in part), " The powers of the initiative and the referendum are hereby further reserved to the qualified electors of every incorporated city, town, and county as to all local, city, town, or county matters on which such incorporated cities, towns, and counties are or shall be empowered by general laws to legislate." Article XIII says (in part): "The charter so ratified may be amended by amendments proposed and submitted by the legislative authority of the city to the qualified electors thereof (or by petition as hereinafter provided), at a general or special election, and ratified by a majority of the qualified electors voting thereon and approved by the governor as herein provided for the approval of the charter."
Tucson has additional provisions for ordinance initiative and referendum only. The city of Tucson computes the requisite signature percentages of voters based on the vote for the candidates for mayor at the last preceding general municipal election at which a mayor was elected (Tucson Charter, Chap. XIX, Sec. 1). The form of a petition is established in the Tucson Charter, Chap. XIX, Sec. 2. On the filing of a successful petition, the council may pass the measure or proceed to call a special election. (Tucson Charter, Chap. XIX, Sec. 3)
- The full text of the Initiative for the "Sustainable Retirement Benefits Act"
- Tucson Pension Reform, website of the organization that supports the initiative
- Tucson City elections department website
- Tucson City Charter
- Retirement Funds/City of Tucson
- ↑ 1.0 1.1 Source: This information was given to Ballotpedia staff by organizers of the initiative.
- ↑ 2.0 2.1 2.2 Arizona Daily Star, "Public vote sought to rein in city pensions", June 6, 2013
- ↑ KJZZ, "Tucson faces $15 million budget shortfall", March 18, 2013
- ↑ 4.0 4.1 4.2 Full text of the initiative (in some cases, text in all caps in the official language was changed to upper-and-lower case text for ease of reading
- ↑ Blog for Arizona, "Out-of-state right-wing organization behind public employee pension initiative in Tucson", June 6, 2013
- ↑ Tucson Weekly, "New Initative Would Scrap Tucson's Pension Program", June 5, 2013
- ↑ 7.0 7.1 Arizona Daily Star, "Pension reform group spends $90,000-plus on petitions," July 11, 2013
- ↑ Tucson Weekly, "Campaign Group Turns in Pension Initiative Signatures," July 2, 2013
- ↑ Tucson Initiative and Referendum Signature Requirements and Deadlines
- ↑ Arizona Daily Star, "Petitions to change city's pension system are filed," July 3, 2013
- ↑ Cite error: Invalid
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