While the state of Arizona has taken strides to address the Public Safety Personnel Retirement System’s (PSPRS) pension debt in recent years, there are still steps the state can take to improve the plan’s solvency.
Arizona’s 2021-2022 budget proposal includes a one-time appropriation of $300 million for a one-time payment on the state’s Department of Public Safety debt within the PSPRS pension system.
By reducing long-term interest costs, it is estimated that this one-time payment would save Arizona taxpayers between $9 million and $42 million each year, ultimately providing a total of up to $500 million in taxpayer savings over the next 30 years.
Further analysis of what impact this one-time $300 million contribution could have on the public pension system is provided below.
The pdf of this explainer is available here: Quickly Paying Down PSPRS Debt is a Win for Taxpayers
Update 5/25/21: This analysis previously stated the $300 million one-time payment was included in an Arizona senate bill. The analysis has been updated to reflect the fact that the one-time payment is now also included in the state’s 2021-2022 budget proposal.
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