The Arizona legislature has enacted a bill that would significantly alter the state's pension system for state and local workers, although public sector unions in the state are vowing to fight the bill in court.
Among the changes, the new legislation requires that public safety officers in the state contribute 11.65 percent of their salaries toward pension costs, up from 7.65 percent. The bill also increases the pension contribution rate for elected officials to 13 percent of pay, up from 7 percent, takes away the pension of any public employee who committed a felony in the performance of official duties, and changes the cost-of-living assumptions in the state's pension plans so that COLAs are only awarded to retirees in years when earnings in the pension trust exceed 10.5 percent.
The move to reform the pension system gathered steam after an eight-part series in the Arizona Republic last fall which chronicled widespread abuses and high costs in the system. Still, unions contend the reforms are unconstitutional because they say the state's constitution prohibits changing the pension benefits of any employee who is already vested in the system. The unions are readying a court challenge.
Among the changes, the new legislation requires that public safety officers in the state contribute 11.65 percent of their salaries toward pension costs, up from 7.65 percent. The bill also increases the pension contribution rate for elected officials to 13 percent of pay, up from 7 percent, takes away the pension of any public employee who committed a felony in the performance of official duties, and changes the cost-of-living assumptions in the state's pension plans so that COLAs are only awarded to retirees in years when earnings in the pension trust exceed 10.5 percent.
The move to reform the pension system gathered steam after an eight-part series in the Arizona Republic last fall which chronicled widespread abuses and high costs in the system. Still, unions contend the reforms are unconstitutional because they say the state's constitution prohibits changing the pension benefits of any employee who is already vested in the system. The unions are readying a court challenge.
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