Idaho bill targets retirement incentives

BOISE – Idaho lawmakers say it’s time to ban a practice of sweetening the retirement funds of state employees to get them to retire early.

That practice resulted in $125,000 in such state expenditures in 2009, including $72,781 for a single employee.

“This is an outrage to Idaho taxpayers and to Idaho state employees who did not receive that same privilege,” Rep. Anne Pasley-Stuart, D-Boise, told the House State Affairs Committee.

The panel voted unanimously Thursday to introduce her bill.

State law strictly bans severance payments to state employees who leave their jobs voluntarily, but the retirement boosts weren’t considered severance because the payments went to the employees’ accounts at the state retirement system, not directly to the employees.

Rep. Elfreda Higgins, D-Garden City, co-sponsor of the bill with Pasley-Stuart, told the committee, “These payouts … would pay for three teachers, tax collectors, parks workers or other services that are much more important to the people of Idaho than paying money to three people so they can retire early.”

The state Division of Human Resources paid the $72,781 to the Public Employee Retirement System of Idaho in October on behalf of its former director, Judie Wright, in exchange for her agreeing to retire eight months earlier than she’d planned. The head of the Division of Financial Management, Wayne Hammon, then took over as acting human resources director in addition to his other duties; he said the move saved the state money.

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

“Many of you know state employees who were laid off who did not receive any consideration at all,” Pasley-Stuart told the House committee Thursday. Idaho enacted its severance-pay ban in 1993 after Dirk Kempthorne paid more than $38,000 in city-funded severance bonuses to two aides who followed him from the Boise mayor’s office to the U.S. Senate. The move caused such a fuss that the office of the new senator, on his first day in Washington, D.C., was besieged with outraged calls from Idaho.

The aides eventually paid the money back to the city. In that year’s legislative session, the state severance pay ban passed both houses overwhelmingly and was signed into law by then-Gov. Cecil Andrus.