Pension costs increasing as Apache Junction, Gold Canyon grow

The Arizona state program that provides lifelong monthly retirement income to city, fire and school district employees is requiring additional funding from both employers and present employees.

In July, city, fire and school district budgets increased funding per employee set aside for pensions.

State retirement system

The Arizona State Retirement Systems retirement pension provides a lifetime guaranteed benefit based on years of service and final salary, according to azasrs.gov.

The retirement system began in 1953 and has more than a half-million members, including nearly 150,000 retirees receiving the monthly benefit, officials say.

Effective July 1, ASRS retirement pension and health insurance is 11.64 percent of an employee’s salary and the long-term disability income plan is .16 percent, for a total of 11.8 percent. The previous fiscal year it had been 11.34 percent of a person’s salary for pension and health insurance and .16 percent for long-term disability, for a total of 11.5 percent, according to current contribution-rates.

In addition to the employer amount, the employee contributes an equal amount into the system.

School/fire districts, city

E-mails were sent May 24 to the city of Apache Junction, Superstition Fire and Medical District and Apache Junction Unified School District to, in part, learn how much of the budget for the last four years and the proposed 2018-19 budget goes to the Arizona State Retirement System, where it is listed on the budget and how many employees are collecting a paycheck and a pension.

The city of Apache Junction and fire district were also asked what the annual salaries and total cost of benefits were for each of the department heads; and, for each, how much money annually goes to the Arizona State Retirement System.

Also, the e-mail sought to better understand how much money was set aside for governing board and council member pensions.

City of Apache Junction

The Independent was told by Al Bravo, public information officer, that it needed to file a Freedom of Information Act for information pertaining to personnel issues.

The FOIA request was e-mailed June 13.

Apache Junction City Clerk Kathy Connelly at a recent Apache Junction City Council meeting.

Before the June 19 Apache Junction City Council meeting began, Apache Junction City Clerk Kathy Connelly told the Independent that many of the questions asked in the FOIA form were suited for an interview and not for such a request.

Ms. Connelly said in an e-mail that the amount of money earmarked for ASRS and where it is listed on the budget could be viewed at ajcity.net/DocumentCenter/View/18583/FY-2018-19-Final-Budget.

“When viewing the city’s budget online, summarized reports are listed first, followed by department budgets, including a separate department page for mayor and city council. ASRS is included in the retirement plan line item under personnel services-fringe benefits-retirement plan,” she said.

Retirement costs for the fiscal 2018-19 budget year are a total of $3,659,450 for the city’s 304.72 full-time equivalent employees, according to the budget page titled “City of Apache Junction Full-Time Employees and Personnel Compensation Fiscal year 2019.”

“We do not have information regarding employees who may be collecting a paycheck and a pension,” Ms. Connelly said in an e-mail.

According to the budget, the seven members of council together were budgeted to have $5,190 for Federal Insurance Contributions Act (Social Security/Medicare), $16,650 for a retirement plan and $170 for workmen’s compensation in fiscal year 2017-18; and $5,175 for FICA, $16,060 for the retirement plan and $170 for worker’s compensation in fiscal year 2018-19.

School district

The Apache Junction Unified School District serves more than 3,600 students in a 217-square mile area that includes the city of Apache Junction, Gold Canyon, Peralta Trail, Queen Valley and the unincorporated areas of the Superstition Mountain foothills. The district was formed in 1952.

Standing at right is Cindy Reichert, finance director for Apache Junction Unified School District, giving a presentation at an AJUSD Governing Board meeting. (Photo by Richard H. Dyer, Independent Newsmedia)

In the 2018-19 budget, 11.8 percent of an employee’s salary goes to ASRS, Apache Junction Unified School District Finance Director Cindy Reichert said in a hand-written, scanned and e-mailed response to questions.

The amounts have risen since 2015-16, when it was 11.47 percent; 11.48 percent in 2016-17; and 11.5 percent in 2017-18, she wrote.

The district did not provide budget amounts that go to the Arizona State Retirement System. Ms. Reichert wrote that they were “listed under benefits.”

According to the last three year’s worth of governing board documents in folders at https://www.ajusd.org/Page/9078, the benefits amounts paid for full-time employees, which include Social Security and Medicare, were:

•2018-19: $4,115,379, approved July 10.
•2017-18: $3,899,100, approved July 11, 2017.
•2016-17: $4,547,022, approved July 12, 2016.

AJUSD teachers received an average salary of $42,318 in the 2018-19 budget year, according to a spending sheet provided by Ms. Reichert.

A total of 22 employees left the district and were rehired and are collecting a paycheck and a pension, she said.

“Duties remained the same,” she said on what their duties were at retirement vs. when rehired.

The pensions contribution rate for retired employees was 9.36 percent of an employee’s salary for the 2015-16 budget year, 9.47 percent for 2016-17, 9.49 percent for 2017-18 and 10.53 percent for 2019-19, Ms. Reichert said.

AJUSD Governing Board members receive no compensation for their duties of serving the students, staff and families of the district. They also do not receive any pension benefits, she said.

Fire district

The Superstition Fire and Medical District was established in 1955 under what is now Arizona Revised Statutes 48-261. It was formed by property owners and registered voters who petitioned the Pinal County Board of Supervisors to create a special taxing district to provide fire protection services.

The fire district encompasses 62 square miles. It provides fire suppression, fire prevention, wildland protection, advanced life support, rescue, extrication and medical transportation services out of five fire stations: Fire Station 261, 1135 W Superstition Blvd. in Apache Junction; Fire Station 262, 3955 E. Superstition Blvd. in Apache Junction; Fire Station 263, 1645 S. Idaho Road in Apache Junction; Fire Station 264, 7557 E. U.S. Highway 60 in Gold Canyon; and Fire Station 265, 9294 E. Don Donnelly Trail in Gold Canyon.

Superstition Fire and Medical District Assistant Chief/Fire Marshal Richard Ochs

Fire district employees are under two retirement systems, SFMD Assistant Chief/Fire Marshal Richard Ochs said in a May 29 e-mailed response to questions.

“I believe some confusion exist between retirement systems. We have two separate systems for two separate employee classes,” he said.

Civilian employees are in the Arizona State Retirement System, he said.

“For these employees, we also pay into Social Security and Medicare. The majority of our employees are sworn (public safety). These employees are not in the ASRS. All sworn employees are in the Public Safety Personnel Retirement System,” he said.

On July 1, 1968, the Public Safety Personnel Retirement System was established to provide a uniform, consistent and equitable statewide retirement program for Arizona’s public safety personnel, according to psprs.com.

PSPRS provides retirement benefits and programs to nearly 59,000 active members, retired members and surviving beneficiaries, according to the website.

Amounts budgeted by SFMD in the general operating fund for the Arizona State Retirement System are:

  • 2017-18: $86,699.90
  • 2018-19: $103,475

For the SFMD transport services fund, the following was for the ASRS:

  • 2017-18: $128,737.61
  • •2018-19: $159,868

Amounts budgeted for the general operating fund for Public Safety Personnel Retirement System are:

  • 2017-18: $1,820,269.83
  • 2018-19: $2,020,348

For the transport services fund, the following was for the PSRS:

  • 2017-18: $32,673.20
  • •2018-19: $19,174

No fire district employees are previously retired and collecting both a paycheck and a pension, Assistant Chief Ochs said.

The SFMD elected board members do not receive a salary and the organization does not provide them with a pension, he said.

Editor Richard Dyer can be reached at rdyer@newszap.com

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