Pension Update – SB1609

retirementSB 1609 the Sen. Yarbrough pension omnibus bill is scheduled to be heard Tuesday, March 22nd, in the Arizona House Employment and Regulatory Affairs Committee. I believe a compromise has been reached between House and Senate leadership on the pension issue. My belief is the hardliners who are against the current public employee pension systems have emerged victorious over our friends and allies in the legislature. I was notified late Thursday night that many of the other unions are now rallying support for future litigation efforts. Rumors agree on one thing, our pension benefits are going to disseminated and current, retired and future members of PSPRS and CORP are going to be significantly impacted. I expect the compromise amendment language will not emerge until late Monday. As soon as I see it I fill forward it to you.

I now urge all APA association leaders to meet with their legal representatives to discuss legal options. I also suggest that each association leader decide on what action, if any, we should take as this bill now moves forward.

Brian L. Livingston

Executive Director, Arizona Police Association

1102 West Adams Street

Phoenix, Arizona 85007

Office Phone: (602) 249-4358

Cell Phone: (602) 319-5872

Fax: (602) 246-0226



Current Employees and Retirees:

The COLA is based on a market value assumption. This is important because the existing Excess Earnings Fund will be able to pay out a COLA for the next two years but after that it may 15-20 years before another COLA is issued. (Retirees and Current Members)

Employees will be expected to pay 11.65% contribution rate in three years. 2% July 2011, 1% July 2012, 1% July 2013.

Drop is eliminated for those with 5 years or less service. Those between 5-20 years will have to pay contributions into the fund when they enter DROP with interest rates dropping on these accounts. Those with 20 years of more service no change in DROP.

Return to work – Penalty payment assessed.

New Hires:

Many changes to the system for people not yet employed.

Other Issues for ALL:

Commission of a class five felony (not conviction) – This would result in forfeiture of your pension.

Military and in-state service – prior service purchase restriction (Not much info on this provision as of yet)

They are also going to study disability payments to all persons so classified in the next two years. This means there is a possibility that disability pensions will be targeted in the future for reduction or elimination