STATUS QUO - The status quo in the City of Phoenix includes a pension problem that has evolved into a pension crisis, due to the lack of leadership at City Hall. Just over 10 years ago, the city’s annual pension cost $131 million each year. Now, that number has ballooned to $316 million.
No change to police and fire fighters pensions
I will not vote for or support any changes to the pensions of current or retired police and fire fighters.
Our first responders were made a promise and as Mayor, I will keep that agreement.
Reassess costs and increase transparency
Because of misleading estimates and work done behind closed doors, we need to re-evaluate the estimated rate of returns on our pension funds to be more realistic about what the City owes. Once we have a more accurate and transparent view, we can be better prepared to make the correct decisions for the short and long-term.
Reduce payment length from 30 years to 24 years
To secure our City’s long-time fiscal health, we need to be more aggressive in making these payments which will save billions of dollars in the long-term. There will have to be difficult cuts made to the City in the short-term, but we can no longer kick the can down the road.
Create a “cost corridor” that works for Phoenix
The pension crisis facing Phoenix is not a new problem or even unique to our city; we should be looking to cities like Houston who have led on innovative pension reforms and find ways to make them fit our situation. I would advocate for creating a “cost corridor” for Phoenix, where the City’s contributions are capped at an agreed upon level, regardless of investment performance, to reduce the burden on taxpayers.
Explore buyout agreements for pension recipients
Our City should be open to creative solutions to reducing the long-term cost of pensions on taxpayers. I would direct City staff to study the potential costs of buyout agreements with former employees that would provide them with a one-time payment and significantly reduce our long-term costs.