By Dustin Hurst and Annsley Brophy | Idaho Freedom Foundation
Gov. Butch Otter knows how to raise income levels -- at least for a few lucky and connected former legislators.
This year, Otter appointed four state senators to high-paying state jobs, which will enrich the job-takers thanks to a special pension carve-out legislators wrote themselves.
The governor’s appointments will even result in million-dollar pension payouts for two former legislators.
According to Idaho Freedom Foundation calculations, former Sen. Dean Cameron, R-Rupert, could pocket upwards of $1.4 million in pension payments over the course of his life if he stays in the post at least 42 months.
Had Cameron instead retired from the Legislature and skipped the job, he would have pocketed about $226,000 in lifetime payments.
In short, Otter’s appointment added more than $800,000 to Cameron’s lifetime payout.
Now, if Otter could do the same for regular Idahoans’ wages and 401ks.
Cameron isn’t the only former lawmaker cashing in through the pension perk. Former Sen. Bob Geddes, R-Soda Springs, could bring home just more than $1 million in guaranteed, taxpayer-backed pension payments if he stays on as the Department of Administration’s director for 30 months. Geddes previously served 12 months on the Idaho State Tax Commission board, another high-paying post.
Had Geddes simply retired from the Idaho Senate instead of taking Otter’s appointment in 2011, the former senator would have brought home about $156,000.
To be sure, these numbers aren’t exact; Idaho doesn’t allow taxpayers to see pension data, despite the information being readily available in other states. These numbers come from calculations based on legislator pay, new salary levels, pension formulas and life expectancy at retirement based on actuarial tables.
These numbers also factor in a 1.995 percent annual cost-of-living adjustment. State law requires a yearly 1 percent adjustment, but it allows the pension board to give more. Through the last 20 years, board-authorized adjustments have averaged 1.995 percent.
Even with those adjustments, the small yearly boosts for retired teachers, cops and firefighters, benefit legislators in a big way. Because the former legislators have bigger pensions, thanks to their special carve-out, the cost-of-living-adjustments mean more than they otherwise would.
A few weeks ago, Otter told Boise radio hosts the pension payoff arrangement is a “miniscule” issue, adding a point about the state paying fair wages for experienced and capable talent.
Yet, IFF research reveals that this is not a minuscule issue. The 11 legislators we highlighted on our Politician Pension Payoff page would have received $1.33 million in total payments over their lifespans.
Instead, the 11 will take home more than $8.7 million over the course of their lives.
Imagine if regular Idahoans were as lucky as the connected class.
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