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Otter: Ban early-retirement bonuses

Mon., March 1, 2010, 3:54 p.m.

BOISE - Gov. Butch Otter now wants Idaho to ban purchases of additional retirement service for state employees designed to get them to retire early - a practice that resulted in $125,000 in such state expenditures in 2009, including $72,781 for a single employee.

Wayne Hammon, Otter’s budget director and acting human resources director, said Monday, “It’s been debated at length, and while we maintain that we did nothing wrong, in these times when we’re watching every penny, we believe there’s better ways to spend the taxpayer dollar.”

Hammon took over for former Human Resources Director Judie Wright when she agreed to retire eight months earlier than planned in exchange for the $72,781 payment into her Public Employee Retirement System of Idaho account. State law strictly bans severance payments to state employees who leave their jobs voluntarily, but such retirement boosts weren’t considered severance because the payments went to the employees’ accounts at PERSI, not directly to the employees.

Hammon said the Otter Administration has an Attorney General’s opinion stating that what it did in Wright’s case - and several others in the past year - was legal, but the governor has decided it’s best to change the law “when we’re cutting everything.”

On Monday afternoon, Hammon met with the co-sponsors of HB 604, a pending bill to do away with the practice, along with a House committee chairman, and agreed to back amendments to the existing bill rather than replace it with a new bill to be sponsored by the governor. Hammon said he supports the amended version and will testify in favor of it.

“The governor supports eliminating the authority,” Hammon said.

Rep. Shirley Ringo, D-Moscow, one of the three legislative co-sponsors of HB 604, said, “I wouldn’t have any problem at all saying that what they did was wrong, so I’d be very pleased if their language does jibe with ours so that we can all move ahead and agree that that won’t happen again.”

Ringo said she thought the early-retirement bonuses were “very inappropriate.” She said, “Whatever the amount of money was, it could’ve been more fairly used in some fashion for public employees in general.”

The Spokesman-Review reported in November that in addition to Wright, two other state employees were given early retirement boosts last June: A state Tax Commission employee who was being terminated for disciplinary reasons was given a $13,531 retirement boost as part of a settlement; and a printing copy technician at the state Department of Education was given a $42,143 retirement boost to allow her to retire two years early rather than be laid off due to budget cuts.

According to state records obtained under the Idaho Public Records Act, two other state employees have received state-funded early-retirement bonuses since 2004, both as part of confidential personnel actions; one, at the State Historical Society, was for $9,648, and the other, at the Department of Lands, was for $12,500.

The amendments from the Otter Administration would exempt the state’s court system from the new ban. It uses retirement-credit purchases as part of program authorized under a separate state law to entice magistrate judges to serve as part-time “senior” judges after they retire. That program, funded by a special $6 fee on court costs, is part of a strategy in which the courts are increasingly utilizing senior judges rather than adding more judges.


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