Tom Jenney
Submitted photo

The pension system for the city of Phoenix is on the verge of ruin. Years of abuse, mismanagement and political malfeasance have pushed the city’s ailing pension fund toward a crisis, threatening to cost future taxpayers hundreds of millions of dollars. This silently mushrooming debt has put Phoenix in fiscal dire straits similar to those of Detroit and Chicago.

Instead of taking action, the power brokers at City Hall have passed sham reforms, mere Band-Aids on a massive hemorrhage.

But the hard-working taxpayers of Phoenix will not be fooled. Last month, Citizens for Pension Reform filed petitions containing more than 54,000 signatures. Those signatures were a resounding “amen” chorus, testifying to the need for real reform of the city’s broken retirement system. Phoenix residents want real reform.

The facts show that we need to repair the system now. The current pension plan is only 56 percent funded. Unrealistic promises by government employee unions have caused pension costs to balloon from $28 million in 2000 to over $110 million in 2013.

Then there is the disgusting practice of pension spiking. Because pension benefits are based largely on the compensation city employees make in their last three years, city politicians have awarded soon-to-retire employees with huge pay increases. The result has been to give some workers unearned six-figure annual payouts for the rest of their lives. This practice alone will cost taxpayers an additional $190 million over the next 25 years.

The total pension debt for taxpayers adds up to a staggering $1.5 billion.

But the pension crisis doesn’t just hurt taxpayers: it hurts city workers, too. It is immoral for politicians and government employee unions to make promises to city employees, knowing those promises will be broken. City workers deserve better. And if it wants to continue to attract hard-working and highly skilled employees in the coming decades, the city of Phoenix can’t bankrupt itself paying for today’s skyrocketing liabilities and pension spiking.

The Pension Reform Act will fix our broken Phoenix pension system by:

• Ending the practice of pension spiking and other windfall pension payouts.

• Transitioning new city employees into a more sustainable and fair 401(K)-style defined contribution system.

• Allowing existing employees to opt into the new defined contribution plan.

• Protecting taxpayers from ballooning pension costs while ensuring that existing and future pension obligations are met.

In response to the ballot measure, government employee unions are trying to scare the public by saying these fiscally responsible changes will somehow harm the pensions of police and firefighters. Those allegations are dishonest and wrong: for better or worse, the Public Safety Retirement System for police officers and firefighters is not subject to the reforms in the ballot initiative.

The Arizona chapter of Americans for Prosperity applauds the Citizens for Pension Reform for putting this important reform on the Phoenix ballot in November 2014. This year, taxpayers will take charge of our own reform and remove politicians and special interests from the equation.

• Tom Jenney is a Phoenix taxpayer and director of the Arizona chapter of Americans for Prosperity (

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