PHOENIX — State lawmakers cannot balance the budget by limiting pension benefit increases for retired judges, the Arizona Supreme Court ruled Thursday.
The justices said a voter-approved section of the state constitution makes public pension plans a contractual relationship. That provision says benefits “shall not be diminished or impaired.”
Justice Robert Brutinel, writing for the unanimous court, said lawmakers can not modify benefits or tinker with the formulas to determine how much those benefits will increase each year.
Thursday’s ruling puts a damper on efforts by legislators to sharply restrain the obligations of the state to finance existing public pensions. But it does not bar lawmakers from setting new rules for those who have not yet become judges.
Because the Elected Officials Retirement Plan ratio of assets to liabilities began to decline, in 2011 lawmakers changed the formula for calculating benefits to hold down increases, prompting a suit filed by several retired judges.
People are also reading…
After losing in early rounds of the court fight, lawmakers voted last year to spell out that any judge who takes the bench this year and beyond will be in a different kind of “defined contribution” retirement plan, similar to 401(k) programs run by many private companies.
