JFAC slashes PERSI budget

PERSI lost a big one in its budget this morning, as set by the Joint Finance-Appropriations Committee: The joint budget committee sliced out $13 million in dedicated funds the state retirement system hoped to spend next year to replace its core IT system. That’s a multi-year project that goes to bid next summer; the money was to be spent over the next three years. “It’s PERSI’s own funds, it’s not general funds,” said Sen. Jim Hammond, R-Post Falls. But, he said, “We just thought it was the better part of valor to wait a year.” Said Rep. Maxine Bell, R-Jerome, “‘Til we’ve forgotten and forgiven.” Added Sen. Dean Cameron, R-Rupert, “There will be better times.”

PERSI was at the center of a political storm last week after the House GOP pushed hard to block a scheduled 1 percent cost of living increase for state retirees, overriding the recommendation of the PERSI board, and then Senate GOP leaders let the bill die, allowing the COLA to go ahead as scheduled. House GOP leaders said they were concerned about PERSI’s unfunded liability, which has grown as the stock market took a big dip.

Sen. Joyce Broadsword, R-Sagle, said, “The current system does crash monthly.” She said, “It’s one of those things they can make a good case for needing it, but the reality of the political situation, I was afraid a motion with $13 million funding in it, given recent events, might not go through.” She noted that the system replacement still could move forward; it’d just be delayed.  Democrats on JFAC offered a substitute motion to fund the system replacement now. “I don’t think we should be intimidated by past discussions here,” said Rep. Shirley Ringo, D-Moscow. “It is dedicated money and I have been quite impressed by the ability of the board to make decisions.” That move, however, failed on a party-line, 4-15 vote; the budget that cuts the $13 million passed 15-4. The budget the committee set for PERSI for next year shows a 9.9 percent cut in total funding; there are no state general funds in the budget.

Don Drum, PERSI director, said, “It’s an old system, it’s not supported by the vendor any longer, we’ve been supporting it in-house. It’s one of those things that we need to transition to new technology.” But he said, “We can move forward. … there is some risk to us, but it’s not risk that we can’t try to address in other ways. We’ll move forward … and hope we can get it next year.”