Idaho is one of approximately 20 states that allow private lobbying organizations to take part in the state government’s pension system. Last winter, the Legislature passed, and the governor signed, a bill that prevents new private, non-governmental organizations from joining the state pension system. The legislation became law because of the impropriety of such an arrangement and partly because there was no real standard to determine which private organizations could participate and which couldn’t.
But a loophole of sorts remains in place. Though new organizations can’t join PERSI, private lobbying groups that already pay into PERSI get to stay — and the new people these private groups hire would have their retirement benefits underwritten by you, the Idaho taxpayer.
To nip this potential taxpayer-burden in the bud, some lawmakers want to pass legislation that would allow current employees of private lobbying organizations to stay in the state pension system, but that new employees of such lobbying groups would have to find another retirement program. The lawmakers contend it’s wrong for state taxpayers to be responsible for guaranteeing the retirement benefit of employees of private organizations that lobby the Legislature. However, the lawmakers note, it’s also wrong to pull the rug out from under employees who were already promised specific retirement benefits. And the lawmakers are right.
So, where do the leading Republican gubernatorial candidates stand on this issue? The Idaho Freedom Foundation asked them for their positions, below are their responses.
U.S. Rep. Raul Labrador was the only candidate to say it’s wrong to let private organizations continue to benefit from the public pension system. He wrote to IFF, “It’s important to recognize that the taxpayers of the state of Idaho are financially responsible for the retirement obligations of the employees on the state’s pension system. It is the right thing for the state to keep its promises to the employees on the system. But going forward, it’s not appropriate to force taxpayers to cover the pension obligations of private organizations, whether they are labor unions, associations, or any other non-governmental organizations.”
Labrador continued, to allow such organizations to benefit from the government pension program “reduces the public’s confidence in the government and raises concerns about cronyism and outside interference by special interests.”
He concluded, “The Legislature took a good step forward last legislative session by preventing new private organizations from joining the state pension system. Going forward, we must continue to protect taxpayers and boost confidence in these public programs.”
Boise businessman Tommy Ahlquist said he agrees that the legislation passed in early 2017 “was the right thing to do, and I strongly support it.” Ahlquist didn’t say whether he’d address the remaining problem of lobbying organizations that continue to be part of the pension system, however he did hint at other reforms: “As Governor, I look forward to bringing my real world experience into state government and take a fresh look at every program to make sure it makes sense and is fair for Idaho taxpayers. I will focus my efforts on making sure that our state pension system continues to be properly funded and well-managed and will pursue smart reforms to prevent pension spiking.” (Ahlquist is correct to highlight “pension spiking” as a problem that plagues PERSI. IFF has repeatedly raised this issue. But, I digress.)
Lt. Gov. Brad Little also signaled his agreement with the 2017 legislation, but that’s about it. He wrote, “This policy change adjusted the growth of future taxpayer liabilities and protected PERSI’s long-term solvency, while ensuring fairness to the people who were already signed up under the existing law and who have been counting on that state retirement plan.” Little added, “As Idaho’s next governor, maintaining and enhancing Idaho’s position as one of the most debt-free states will be my priority, and this is paramount to all Idahoans and the employees covered by PERSI.” Little declined to elaborate beyond that.
The Idaho Association of Counties is one of the lobbying organizations whose employees are part of the state pension system. When its chief lobbyist, Dan Chadwick, retires early next year, he’ll collect a state pension that he earned while he pushed for the repeal of term limits and worked to prevent property tax reductions. Other lobbying organizations that belong to the state’s public employee retirement program include labor unions, such as the Idaho Education Association, and the pro-city government Association of Idaho Cities.
When Idahoans learn that private special interest groups and their lobbyists benefit from state government retirement benefits, they tend to be less-than-thrilled. Thus, I predict Idaho’s next governor will likely have to resolve this issue once and for all.