Although it may not be well-known outside of government circles, the Idaho Public Employees Retirement System of Idaho (PERSI) is an important current and future revenue stream for 115,000 Idaho public workers, and another 50,000 retirees.
Without this model pension plan, ranked among the best in the country, many Idaho workers in schools, law enforcement, corrections, water resources, and many other state and local entities would be less well-off than they are today.
Unlike many other states, Idaho takes a conservative approach to pension obligations in the public sector. Many states have poured benefits into pension plans only to find themselves overextended when the economy shifts in the paying entity. No one wants to tell employees they can’t have a new benefit or an expanded one and this mentality is common elsewhere.
Idaho’s pension approach is to limit obligations and to secure revenue in various ways. For example, the state maintains a low ratio of obligations to income; many states have raised their obligations to unrealistic goals which can’t be met with declining income.
Also, Idaho’s investments are a broadly-based mix of stocks, bonds and other income-producing revenue. There are no hog belly or orange juice futures in Idaho’s portfolio. This is a tortoise investment approach, not a rabbit one. It’s a meat-and-potatoes plan which has served the state well for decades.
The fund’s overall financial manager, Bob Maynard, will retire next year but the basic plan is likely to remain pretty much the same. It now has assets of over $23.5 billion, and is more than 105% funded above obligations. That puts it in stellar company with only a few other public plans nationally.
The fund’s growth last year was nearly 28%; it invests in conservative stocks, bonds and other secure revenue streams. There’s nothing fancy about this. It’s just another example of how Idaho’s pay-as-you-go, don’t overspend, don’t commit money we don’t have approach to public finance. (IdahoPress, 8/30).
Independent groups also notice Idaho’s PERSI stability and returns. A recent report placed PERSI in the top seven states on pension benefits to teachers. Idaho school officials say the PERSI retirement plan helps make teaching in Idaho competitive to other states despite lower base salaries. (IdahoEdNews, 9/7).
Unions and other lefties sometimes complain that the program does not provide enough. These Biden-ista, spend-it-all liberals want the government to fund cradle-to-grave benefits, give money to those who won’t work, and worm government into yet another aspect of American life.
Regular cost-of-living increases, usually annually, keep PERSI benefits to retirees more or less competitive. Could Idaho spend more? Sure. But that would mean either higher tax obligations and the costs would then fall back on all citizens.
On the right, critics would like to see workers left on their own at the end of their working careers. These critics, including the Idaho Slavery Foundation and House hothead rightists, are really advocating a form of social Darwinism. It’s a robber baron system in which workers don’t deserve more than the paychecks they receive week by week. This is the message of the McGeachin-ites who disdain public responsibilities and want “freedom” only for themselves.
PERSI’s board is appointed by the governor, and it’s hard to imagine McGeachin doing anything except appointing far-right cronies like Wayne Hoffman to such key positions. It’s a hidden danger in the coming primary election.
If we want stability in state government, we have to vote for it. There are plenty of charlatans out there who want to take Idaho into extreme ideologies. The PERSI appointments are as important as any in the state. Getting this wrong by tin-hat nominations would make Idaho more like the governmental cesspools of Illinois, New York, New Jersey or California, or cities like Detroit. Who wants that? If that’s your choice, go live there.
You don’t have to listen to many public employees or retirees in Idaho today to hear the importance of the PERSI plan to their financial security. Statewide, the plan pays out close to a billion dollars annually into communities large and small. Tens of millions of dollars go to Twin Falls and Bannock Counties alone. That’s money that people then use for all kinds of consumer goods and to invest in themselves. (PERSI.Idaho.gov.)
Maynard and PERSI’s Executive Director Don Drum have done an excellent job in managing this critical state retirement pool. Legislative oversight also plays an important role; the commerce committees in the House and Senate hear presentations every year on the fund’s progress.
As chairman of the House committee for several years, I saw the numbers up close. People should not worry that the fund won’t be there. It will, thanks to its solid leadership, good gubernatorial appointments and a conservative, meat-and-potatoes approach to investing. That’s the Idaho way.
Here, as with other aspects of Idaho governance, ideological-driven rants from the Idaho Slavery Foundation and their candidate-puppets would immensely damage the state.
Stephen Hartgen, Twin Falls, is a retired five-term Republican member of the Idaho House of Representatives, where he served as chairman of the Commerce & Human Resources Committee. Previously, he was editor and publisher of The Times-News (1982-2005). He can be reached at Stephen_Hartgen@hotmail.com.