Finance

Phoenix Tries to Keep Pension Costs Down (a Little)

November 1, 2013

Phoenix leaders corralled enough votes on Thursday to approve a plan to tackle pension “spiking,” but its narrow passage highlighted a sharp division between City Council members who called the changes minuscule and those who were concerned about the impact on employees.

The council voted 5-4 for a package of modest reforms to combat spiking, generally seen as the artificial inflation of a city employee’s income toward the end of a career to boost retirement benefits. Some top managers have enhanced their annual pensions by tens of thousands of dollars because they were allowed to factor perks into the final pension calculation.

Up until the time of the meeting, it was unclear if the council would once again be gridlocked over the proposal. It had rejected the same reforms during a contentious, hours-long meeting last week, where the council broke into three factions.

This time, Mayor Greg Stanton and supporters of the plan mustered enough votes.

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