State Supreme Court rules state retirement plan law unconstitutional

By Howard Fischer | Capitol Media Services via Arizona Capitol Times

A 2011 state law requiring employees to pay more into their retirement plans is unconstitutional, the Arizona Supreme Court ruled Thursday, meaning higher future expenses for state and local governments.

In a divided ruling, the justices said that when judges took the bench they were told they would have to contribute just 7 percent of the earnings to the Elected Officials Retirement Plan. Acting Supreme Court Justice Randall Howe, writing for the majority, said that became part of their contract with the state.

What that means, Howe said, is that the state could then not unilaterally boost the judges’ contribution to 10 percent in 2011 rising to 13 percent two years later, even if lawmakers said that was necessary to maintain the financial stability of the pension fund.

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