I have, so far, sent one and only one recommendation to the Idaho Legislature’s new DOGE task force that is supposed to be on the hunt for efficiencies in government. I could send more, but I wanted to offer something that checks all the boxes for legislators who want to:
Make government more efficient.
Save taxpayers millions of dollars.
Reduce property taxes.
Raise government employee take home pay.
Not really cut any government programs.
So my one recommendation is as follows: Stop adding new employees to the pension program called PERSI, the Public Employee Retirement System of Idaho.
You might not be aware but nearly 900 state and local government agencies participate in the program, which provides a regular check to pensioners upon their retirement. The pension is based on years of service and the highest years of income earned during that time.
The problem with the system is that it is extremely expensive to operate, and that cost is borne by employees and taxpayers. In fact, it’s one of the leading drivers of higher property taxes, but no one likes to talk about that.
Each general government employee contributes 7.18% of his paycheck to PERSI. The employer — meaning the taxpayer — puts in 11.96%. This combined contribution rate of almost 20% is the highest in the state history, having inched its way upward since the program started officially in 1965.
Police and fire employees pay even more — their contribution rate is a record high about 24.3% of the payroll — going to PERSI, with more than 10% covered by the taxpayer. In about two years, it is projected that the police and fire contribution rate will rise to more than 28%; the general government employee’s PERSI contribution will go to almost 23%, according to figures from the state pension system.
To put this in perspective, in the private sector, it is common for employers to match their employees’ contributions dollar-for-dollar up to 3%. To add more perspective, under the PERSI system, some employees are able to retire with full pension benefits at the ripe old age of 50.
The PERSI backers — who jump into high gear and lobby the Legislature endlessly every time I mention this idea — will say that Idaho has one of the best run pension systems in the country. It’s better than California or Illinois, for example, which is true. But this isn’t the point. It’s the expense. In order to cover all the generous pension benefits for retirees, it costs a lot of money, and this cost is borne by taxpayers.
The cost to taxpayers also is compounded by the fact that in order to offer competitive take-home pay for government employees, salaries must necessarily be raised ever higher to satisfy the day-to-day living expenses of the people on the government payroll. You can’t just take 20% out of people’s paychecks and expect them to be satisfied with the result when they have bills to pay.
My proposal is to start winding down the PERSI program while still honoring the commitment to existing employees, retirees and beneficiaries. New employees should enjoy the same kind of retirement benefits as what you find in the private sector.
Lawmakers say they’re looking to save money and be more efficient? PERSI is their chance to prove it.
You can find more of former IFF President Wayne Hoffman's opinions by visiting his Substack, "Level Up Humanity," by clicking here.
