I find it alarming that some in the community choose to white-wash the facts regarding the Public Safety Personnel Retirement System (PSPRS) unfunded liability issue. It’s easy not to like the facts, but they’re still the facts. I’ve again related ten facts to the best of my ability that I want to share before this August 29th election. These are not the only facts to be considered, but they are important.
Fact number one (1) is Prescott has a near 78 million dollar public safety pension liability.
Fact number two (2) is Prescott maintains police and fire departments that, including its annual contribution to the pension system, costs more than the annual General Fund (funded currently by a one-cent sales tax).
Fact three (3) is the state-wide liability was not Prescott’s making. The PSPRS Board’s chosen investment brokers made investments that didn’t produce the Board’s defined benefit. By law, Prescott has to make whole our departments’ share of the pension fund.
Fact number four (4) is Prescott’s current business model provides funding (a portion of the one-cent sales tax) for both police and fire from the General Fund.
Fact number (5) is the General Fund provides money for the library, parks and recreation, and general government services in Prescott.
Fact six (6) is without more money, the service delivery and department structure for all departments will be different. Understanding approximately 75% of the General Fund is consumed by public safety, it is rational to expect those departments will be most significantly impacted by the election’s outcome.
Fact (7) is the City Council and management cannot generate enough money to pay the pension liability and current operational model with continued employee and service cuts without significantly compromising public safety and quality of life services.
Fact eight (8) is that Prescott cannot fix the state’s pension system problem with a tax increase in Prescott to address our liability. Using a different service model moving forward doesn’t eliminate the current liability.
Fact nine (9) is Prescott can and will address our mandated liability issue.
Fact ten (10) is Prescott will continue to function regardless of the outcome of Proposition 443.
What the proposition’s outcome will do is provide Council with the apparatus needed to budget for the future. The picture of Prescott’s public service delivery is definitely reliant on the public’s willingness to fund the costs of all services. Hence this election’s outcome will define the public’s spending priorities.