Suspended Arizona pension boss should lose that outrageous $43,000 pay raise
Laurie Roberts, Arizona RepublicPublished 5:28 p.m. MT April 24, 2019 | Updated 1:45 p.m. MT April 25, 2019
Opinion: The financially troubled Public Safety Personnel Retirement System is awfully generous with other people’s money.
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Jared Smout, administrator of the Arizona Public Safety Personnel Retirement System. (Photo: Special for The Republic)
The state’s pension fund for public safety workers may be one of the nation’s worst when it comes to performance. But when it comes to generosity, there is, apparently, none better.
The Republic’s Craig Harris reports that the Public Safety Personnel Retirement System board in November voted to give Administrator Jared Smout a $43,147 raise, to $252,000 a year.
Then the board made the raise retroactive to Jan. 1, 2018.
Smout is now on paid administrative leave – no doubt enjoying his 20 percent raise as the board investigates a staffer’s complaint of unfair treatment.
Possibly unconstitutional? Who cares?
Oh, please oh please, let my next job be at PSPRS …
… Where not even a warning that it may be breaking the law deters these guys from opening the pension fund’s wallet and doling out raises.
On April 17, the Arizona Department of Administration warned the PSPRS board that Smout’s retroactive raise may constitute an unconstitutional $43,147 gift of public money and ordered the pension board to stop doling out raises.
So, naturally, the board on Tuesday doled out a $39,500 raise to Bret Parke, the PSPRS assistant director/general counsel who is now serving as interim director.
How will they justify his raise?
PSPRS board members justified Smout’s 20 percent raise as his first since 2015. I’m sure rank-and-file state employees – who generally have enjoyed pay raises closer to 2 to 3 percent in that same time period – feel his considerable pain.
Board members justified Parke’s 21 percent raise as a result of his expanded duties in Smout’s absence.
No word on how they justify not bothering to consult with the Department of Administration before giving out raises – something state law compels them to do.
“This is something we will have to work with them on,” the always diplomatic DOA spokeswoman Megan Rose told Harris.
Here’s a better idea: Take the cash back
Here’s an idea for how to work with PSPRS board members on that: tell them to take the money back.
Tell them a $43k raise — applied retroactively for up to a year — is not only an unconstitutional gift. It is an outrage.
This $10.2 billion pension fund – fueled by taxpayers and contributions from police and firefighters – was rated the third-worst performing government trust fund during the 10-year period ending in 2015, according to a 2017 report by the Pew Charitable Trusts.
Below-average investment returns, combined with high fees and generous payouts to retirees, have left the trust with no where near the money it needs to pay its current and future obligations to its 60,000 members.
That has forced cities to drain their budgets to cover the shortfall, leaving some close to bankruptcy and others cutting basic services.
And Smout, who for years has served in key leadership roles at PSPRS, just snagged a 20 percent pay raise?
Get. It. Back.
Reach Roberts at laurie.roberts@arizonarepublic.com.
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