PowerPoint Presentation (Added 6/17/21)

Council Workshop
Public Safety Personnel Retirement System 
(PSPRS) Funding Policy
June 22, 2021

2
Overview
• Background
• Pension Funding Policy
• Council Feedback & Next Steps

3
Background
• Arizona House Bill 2019 passed into law on April 3, 
2018
–Codified into Arizona Revised Statutes section 38-863.01
–Required municipalities to adopt a pension funding policy for 
PSPRS
–Policy must be adopted on or before July 1, 2019, and 
annually each year thereafter
–Policy must be posted on the city’s public website

4
Background
• The pension funding policy must include funding 
objectives that address:
–How stability will be maintained for the required 
employer contributions
–How and when funding requirements will be met
–Define the funded ratio target and a timeline for 
reaching the target

5
Pension Funding Policy
• Funding ratio goal is 100%(fully funded) by June 30, 2037
–Based on the June 30, 2020 actuarial valuation 
–Council plans on using the 20-year amortization period
–Maintain required contribution payment from operating funds
–Formally accepts assets, liabilities, and current funding ratio
• Assets of $326 million
• Unfunded accrued liability of $290 million
• Funded ratio of 53%

6
Pension Funding Policy
• The Council will issue Certificates of Participation in FY22
–One-time payment to PSRS to pay down unfunded liability
–Achieve an estimated 90% funded level 
• The Council will establish a Pension Stabilization Reserve Fund
–Restricted Fund
–Used only for addressing future pension and unfunded liability needs
–$20M from savings over two to three-year period
• Does not preclude the City from making additional 
contributions

7
Council Feedback & Next Steps
• Council Feedback
• Next Steps
–Resolution to adopt funding policy 
• June 22, 2021