Court strikes down the Arizona Republic’s pension reforms as unconstitutional

Posted by AzBlueMeanie:

This week our Tea-Publican Arizona legislature launched an assault to destroy public sector unions in Arizona, led by the Goldwater Institute.

But before this assault on working people and the American middle-class came the "softening up" phase, the assault on state employee pensions.

The assault began with a series of "investigative" reports in the Arizona Republic in the fall of 2010 that relied heavily on the biased research of the Goldwater Institute and quoted liberally from Goldwater spokesmen. The Republic has a long and sordid history of anti-unionism. The editorial staff of the Arizona Republic pressed the legislature for state pension reforms.

The Tea-Publican legislature, citing the Arizona Republic's "Investigative" (sic) report, which was really nothing more than restated Goldwater Insititute research, took up state pension reforms in 2011.

Both our Tea-Publican legislators and editors of the Arizona Republic continued to press for pension reforms even in the face of well-reasoned legal arguments that it violated an express provision of the Arizona Constitution and contract law (impairment of contracts), and I would argue violated the fiduciary obligations of the pension fund manager (Arizona) to the fund beneficiaries. Our Tea-Publican legislature adopted the state pension reforms argued for by the Arizona Republic as proxy for the Goldwater Institute.

Multiple lawsuits were filed and immediately things did not go as planned for our Tea-Publican legislature.

The Court pointed out the obvious legal problems stated above. Some members of our Tea-Publican legislature prepared to concede defeat and to repeal the state pension reforms passed last year and to restore any funding difference. Legislature to repeal the Arizona Republic's unconstitutional pension reform legislation.

On Friday, Maricopa County Superior Court Judge Eileen Willett ruled the Arizona Republic's pension reforms unconstitutional. That should teach them a lesson not to rely on the highly partisan Goldwater Institute. Arizona pension law ruled unconstitutional:

Judge Eileen Willett noted in her ruling that the state Constitution describes the public retirement system as a contractual relationship between the state and its employees and that state statutes forbid laws "impairing the obligation of a contract."

"When the plaintiffs were hired as teachers, they entered a contractual relationship with the State regarding the public retirement system of which they became members," Willett wrote. "Their retirement benefits were a valuable part of the consideration offered by their employers upon which the teachers relied when accepting employment."

Donald Peters, the lead attorney for the teachers, said, "The judge found that the state has to abide by the promises it made to its employees."

Howard Fischer adds Arizona court: Employees don't have to pay larger share of state pensions – East Valley Tribune:

Willett said that move ignored a provision in the Arizona Constitution which spells out that membership in a public retirement system is a contract and that benefits "shall not be diminished or impaired.''

She acknowledged that nothing in the change reduces what workers would get when they finally retire. But Willett, ruling in a lawsuit brought by members of several unions, said that misses the point.

"Increased costs incurred over plaintiffs' length of employment for receipt of the same benefit negatively impacts the value of the benefit the plaintiffs ultimately receive,'' she wrote. "By paying a higher proportionate share for their pension benefits than they had been required to pay when hired, plaintiffs are forced to pay additional consideration for a benefit which has remained the same.''

In siding with the employees and the unions, Willett rejected arguments by attorneys hired by the state that the fact that the 50-50 split was in effect when these workers were hired does not entitle them to the same treatment as long as they are employed.

Lawyers for the state also contended that the interests of the state were more significant than those of any of the more than 210,000 state, school and local government workers affected.

Willett, however, was not swayed.

"The impairment to the contract is substantial, and no significant and legitimate public purpose exists for the breach,'' she wrote.

This is a complete and total defeat for our lawless Tea-Publican legislature that routinely disregards the Arizona Constitution and the rule of law.

Anticipating this ruling, Tea-Publican lawmakers have proposed rescinding the reforms. House Bill 2264 would return to the previous funding system of a 50-50 split between the state and its workers. The bill has passed the House Employment and Regulatory Affairs Committee, but it still needs a hearing before the House Appropriations Committee.

What we do about the Arizona Republic, the "newspaper of record," carrying water for right-wing think tanks like the Goldwater Institute is a problem that will be more difficult to correct.