Facing Police Shortage, NM Considers Pension Changes

As Santa Fe expands city turf, it co-sponsors supportive resolution.

New Mexico’s Republican Gov. Susana Martinez said she will back bills that support police officers being able to return to work while earning pension pay, and it’s causing a ripple into the cities. 

On Wednesday, the City Councilors in Santa Fe  co-sponsored a resolution expressing support if state legislation allowed police officers to return to work while still collecting retirement benefits. Councilman Chris Rivera said the change could help the ongoing shortage of police officers in the city.  

“We’re in a dire crisis and we really need to diversify our options,” Rivera told CIO.

Santa Fe city is expanding, and annexing more land, which widens the area for police officers to cover, a spokesman told CIO. Currently, police officers are retiring at a young age and still want to work, said Rivera, and laws could allow it if they limited high salaries and upper rank progression to post retirement re-hires.

In New Mexico’s largest city, Albuquerque, the mayor has stated that he wants to add 400 police officers to the force. Albuquerque police officers can retire after 20 years with 70% of their pay.

Pensions for people returning to government work were frozen in New Mexico in 2010 out of fear that ‘double dipping’ would increase costs to taxpayers if people came back to work and were re-promoted to the high salaries they retired from. But there is a strong push by public safety for laws to change back to stem the ongoing shortages of police and fire personnel. Changing the return to work policy was brought up last year but “didn’t get far” in the legislature, said Rivera.  

“The legislature is concerned with return-to-work provisions because they negatively impact the pension funds,” Ann Hanika-Ortiz, principal analyst, Legislative Finance Committee of the State of New Mexico, told CIO in a phone interview. “Using the pension funds to solve recruitment and retention issues is probably not a good idea over the long term, especially when you have underfunded pension systems, which we do in New Mexico.”

However, a scenario that would not negatively impact the fund would be to create parameters that kept police officers from accruing additional benefits while they’re re-employed, and to require them to suspend their cost of living adjustment (COLA) while they’re re-employed. New Mexico provides a 2% fixed compounded COLA, and all other return-to-work public employees have to suspend it, said Hanika-Ortiz.

In 2013, the pension reforms included an incentive to delay retirement that increased the maximum pension amount from 80% to 90% of one’s average final salary. According to analysis by the Public Employee Retirement Association, “the incentive could mean an additional half-million dollars in lifetime retirement benefits by working an additional five or six more years,” said Hanika-Ortiz.


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