An overhaul of Phoenix's municipal employee pension system going to voters March 12 could save the city more than $600 million over the next 25 years, supporters say.
The two-part referendum includes Proposition 201, which would increase employees' contributions to the Phoenix Employee Retirement System while reduce the city's annual contribution, and raise the retirement age, and Proposition 202, which would authorize a more aggressive investment approach by the pension system.
City employees currently contribute up to 5% of their annual pay into the retirement system, which the city contributes 20% of the employees' annual pay.
Proposition 201 would equalize the employee and city contributions. Employees can now retire when their age and their time with the city totals 80 years, but the proposed revisions would raise the total to 87 years.
The new terms only would apply to employees hired after July 1. New city workers also could retire at 60 if they have 10 years of service, or at 62 with five or more years.
Proposition 202 would allow the pension board to put its funds into higher-yield but riskier investments. The annual contribution to the system by the city could also be higher than now permitted, which would help Phoenix cut the pension program's unfunded liability.
The changes also would not apply to public safety employees, who are covered by a state pension program.