Photo by Cindy Barks.
Getting the word out statewide about the growing liabilities of Arizona’s public-safety pension system is among the goals of a newly appointed legislative committee, says the committee’s chairman, State Rep. Noel Campbell.
On Thursday, June 15, Arizona Speaker of the House J.D. Mesnard announced the creation of the Ad Hoc Study Committee on the Public Safety Personnel Retirement System (PSPRS).
Campbell and State Rep. David Stringer, the committee’s vice chairman, had earlier reported that they would be heading up the statewide effort, and Mesnard announced the appointment of five other legislators this week: Republican Reps. Bob Thorpe, David Cook, and David Livingston, and Democratic Reps. Charlene Fernandez and Athena Salman.
The effort will kick off later this month with a meeting from 5 to 7 p.m. June 28, at Flagstaff’s Coconino Community College.
While the agenda is yet to be determined, Campbell said the first meeting likely would bring in “stakeholders,” such as representatives of PSPRS, the city of Prescott, the city of Flagstaff, and the League of Arizona Cities and Towns.
In addition, Campbell said, “Anyone can come forward. We’ll have questions, and we’ll have back and forth.”
Campbell says the committee will aim to inform and educate state residents and officials about PSPRS’s issues.
“We’re trying to head this thing off before a crisis starts,” Campbell said, noting that he sees the committee as “kind of like Paul Revere – we’re sounding the alarm.”
While Prescott residents have been well versed in PSPRS’s growing impact on the city’s budget, Campbell said other Arizona communities may not be as aware.
A news release from Mesnard states: “Representatives Campbell and Stringer both represent Prescott, which is facing financial strain due to rising pension contribution rates and an unfunded pension liability of more than $80 million.”
Campbell added: “Many other communities, particularly in rural areas with high legacy costs, are facing similar financial crises. We have to act.”
Stringer voiced similar concerns. “We have to find a solution,” he stated in the news release. “In order to protect current public safety retirees and our communities, we have to protect the solvency of the fund.”
Both Campbell and Stringer emphasized in the news release that the purpose of the Ad Hoc Committee is to “educate communities and bring stakeholders together to find equitable and sustainable solutions that work.”
Campbell said the committee plans a number of meetings around the state. After the first meeting in Flagstaff, he said the committee would conduct meetings in: Bisbee/Douglas; Prescott; Globe/Miami; and Yuma.
The dates of those meetings have yet to be set, but Campbell said the committee likely would meet about twice a month, and will finish up with several meetings at the capitol in Phoenix.
Campbell was uncertain this week whether the committee would be able to come up with possible solutions before the start of 2018’s legislative session.
“We don’t know until we see the gravity of the problem -- first things first,” he said, predicting that any possible solutions “are going to take a couple of years.”
The PSPRS Ad Hoc Study Committee will have access to the resources of the Arizona House of Representatives, including the legislative staff, the news release stated.
“Following the review and evaluation process, the committee will report to the House on their findings and make recommendations to protect the solvency of the fund and seek ways to relieve the financial strain on affected communities throughout the state,” the release added.
Among the committee’s topics of study:
• An overview of PSPRS and employer contributions over the past 20 years.
• The impact of various actuarial and investment assumptions by the PSPRS board and other regulating entities.
• Results of recently enacted PSPRS reforms.
• Impacts to cities, towns, and fire districts from increasing pension contribution rates.
• Concerns and proposals of stakeholder organizations and taxpayers.