September 30, 2021
Public Safety Personnel Retirement System
State of Arizona
FOR IMMEDIATE RELEASE
Contact: Christian Palmer
Fiscal year 2022 employer contributions top $1 billion
Employers continue to pay down debts during July and August
Arizona – Employers within the PSPRS system have continued to save billions of dollars and shore up members’ retirements by paying down their pension debts through additional contributions.
In July and August, the first two months of the 2022 fiscal year, PSPRS received more than $1.1 billion in additional contributions earmarked towards eliminating unfunded liabilities. In all, nearly 30 employers made additional contributions of at least $1 million, indicating aggressive action on behalf of larger and smaller agencies. Combined with the $1.58 billion in extra funds contributed last fiscal year ending June 30, the additional employer contribution totals reached $2.7 billion.
“This collaborative effort between the system and employers continues to retain momentum and will save taxpayers billions of dollars,” said PSPRS Administrator Mike Townsend. “PSPRS today sits in much better financial condition today than in years past.”
The largest additional contributions to the public safety and corrections retirement plans in July and August came from the City of Tempe, which contributed $341 million to reduce unfunded liabilities associated with police and fire department pensions. The City of Glendale contributed an additional $251 million to reduce unfunded police and fire pension liabilities. Pima County contributed an additional $203.8 million to shrink its Sheriff’s Department pension liabilities.
Many agencies are leveraging low interest rates to pay down pension liabilities via debt financing. Other local and county governments have made additional contributions from their general funds or by realizing savings elsewhere in the budget.
With the enactment of Laws 2021, Chapter 241 (Senate Bill 1298), Arizona’s fire districts have begun to use debt financing instruments. Superstition Fire and Medical and Golder Ranch paid down some of the largest district pension debt sums with each contributing approximately $25 million ($50 million total) towards their unfunded liabilities.
Employer valuations for the fiscal year ending June 30, 2021, will reflect the $1.58 billion in additional contributions received in FY2021, as well as record-high annual investment returns. Those valuations and the system’s consolidated annual reports for public safety, corrections and elected officials plans will be completed and published before the end of the calendar year.