Scottsdale City Council accepts funding plan eyes complete payment in 2036
By Terrance Thornton | Digital Free Press
Scottsdale City Council has set its fiscal year 2024-25 Public Safety Personnel Retirement System funding policy.
Following distinguished service of a municipal police officer, those brave men and women of local law enforcement are enrolled in the statewide Public Safety Personnel Retirement System, or ‘PSPRS,’ providing a dedicated source of income for those who are retired or unable to perform duties through a formal medical diagnosis.
The PSPRS system was established in July 1968 and is meant to provide an equitable statewide retirement program for Arizona’s public safety personnel.
“Annually PSPRS provides the city with both a police and fire actuarial report that includes the city’s assets, liabilities, unfunded actuarial liability, funding ratio, and the projected contributions required for the upcoming fiscal year,” Anna Henthorn, Scottsdale accounting director, said in her May 14 report to City Council.
“The PSPRS actuarial reports from June 30, 2023, reflect a funded ratio of 68.1% for police and 84.3% for fire.”
Scottsdale City Council accepted current rates of unfunded liabilities and this year’s contribution to the statewide public safety pension fund at its May 14 regular meeting at City Hall, 3939 N. Drinkwater Blvd.
Ms. Henthorn points out state law requires local municipalities to adopt a formal PSPRS funding policy to communicate how police and fire pension obligations will be met every year.
“The city also is required to formally accept the city’s share of the assets and liabilities based on the PSPRS actuarial report and post the pension funding policy on its website and transmit the pension funding policy to the PSPRS board,” she said. “The city’s unfunded liabilities were $150,781,885 for police and $31,485,241 for fire.”
Ms. Henthorn reports all PSPRS obligations have been met meanwhile this most recent fiscal year Scottsdale City Council authorized a one-time, $10 million payment to help improve unfunded public safety pension liabilities.
“For fiscal year June 30, 2023, the city paid the required contributions to PSPRS for police and fire of $27,372,013 as well as a one-time payment of $10,000,000 toward the police unfunded liability,” she said. “The fire pension plan also annually receives a fire premium insurance tax credit to the city’s fire trust fund to further reduce the city’s required contribution. The amount received in fiscal year 2023 was $2,284,183.”
Ms. Henthorn says City Hall officials hope to have the unfunded PSPRS liability paid by June 30, 2036.
