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Trusted local news leader for Prescott area communities since 1882
8:31 AM Mon, Oct. 15th

Letter: Pension problem


Regarding the Public Safety Personnel Retirement System (PSPR), pensions are not the problem - the problem is that they are “underfunded” because they are “guaranteed.” This guarantee will drive municipalities bankrupt.

I respect and appreciate our public employees and the great work they do to serve and protect our community. But all of us, in the private sector, suffered through the dot com crash and the great recession, but we didn’t get a bailout. Because of a decline in the stock market, poor fiscal management, and/or lack of effective board oversight, taxpayers will have to bail public employees out?

We have been told the city can’t fix this, only the state. Regardless of who owns this problem, if this tax passes, the city loses their leverage to ever get this fixed. What are the chances if this tax increase passes before the problem is fixed, that it will ever get fixed?

Until the state gets control of this issue, raising the sales tax is not a permanent fix — the system is broken and doesn’t need a band aid. What happens in 10 years when it expires?

I don’t believe all options (modifying the investment pool, reduced benefits for new employees, increased employee contribution and/or reduced COLA and benefit levels, convert to a defined contribution plan, prioritizing spending and cutting low priority items) to fund the liability have been discussed thoroughly. The recommendations of the Arizona League of Cities and Towns needs to be applied to existing employees, not just future employees.

We were shutting down fire stations and freezing hiring at police stations, but on Wednesday, June 22, 2016, The Courier reported that the city was going to hire a “community outreach manager,” who is expected to earn $80,000 per year. This is to replace the “communications job” that was cut in January 2016. So eliminate one position, but then add another? So public safety was not a priority, but “community outreach manager” was?

The Courier also reported that the city approved spending $3.6 million for the Highway 89 widening, including $1.5 million for the Phippen roundabout. Let the developers pay for all this if the development causes more traffic. So public safety was not a priority, but highway widening was?

Now we are told that we have public safety issue that is a top priority and more police and firefighters need to be hired. According to the Courier (Jan.26), the new PSPRS tier reduces the pension-contribution cost for the city, and employees hired and enrolled after July 1, 2017. Hiring new police and fire employees now, before the new tier goes into effect, is irresponsible and shows a disregard for using our taxpayer money wisely.

So, before raising the sales tax, including the tax on food, why not eliminate non-essential services now, freeze hiring immediately, reduce spending, eliminate future cost-of-living raises, use city financial reserves now, and sell unneeded city property immediately?

John Ormando