Even after Idaho’s leading teachers union president spiked her publicly funded pension, lawmakers say they won’t address this issue this year.
It’s a little-known fact the Idaho Education Association and other private groups participate in the Public Employee Retirement System of Idaho. Thanks to that arrangement, a few lucky employees can add thousands of dollars a year to their public pensions.
The latest case is Penni Cyr, IEA president since Aug. 1, 2011, who just completed the 42-month stint needed to boost her pension using PERSI’s calculation. Because she’s worked in the IEA post for more than three years and six months, she’ll boost her pension significantly.
That wouldn’t have happened had Cyr remained in the classroom.
According to the IEA’s federally required tax documents, Cyr brings home about $108,000 annually, more than the $62,000 a year she earned in the Moscow School District. Thanks to PERSI’s calculations, Cyr’s retirement payout will be based solely on her IEA salary and all the months spent working at a significantly lower salary will only help boost that.
If Cyr retired this month, she would pocket $31,000 in retirement payments annually. Had the IEA president remained in the Moscow School District for those 42 months and retired in February, she would have only earned $17,980 each year.
Had Cyr simply retired in August 2011, she would have a pension worth about $14,668 each year.
Cyr isn’t the first to see extra perks by serving as a private association president. Her predecessor, Sherri Wood, also spiked her pension while serving as the IEA head. Wood added nearly $40,000 a year to her retirement plan, a much larger boost than Cyr, fueled by 28 years in Idaho classrooms.
The IEA did not respond to an IdahoReporter.com email on the issue.
To be sure, union presidents aren’t the only workers benefiting from favorable pension loopholes. Sen. Elliot Werk, D-Boise, resigned his seat Tuesday to take a job on the Idaho State Tax Commission, a job that pays $87,000 a year.
Thanks to the job, by way of a Gov. Butch Otter appointment, Werk will add more than $20,000 annually to his pension than what he would have pocketed had he simply remained in the Senate.
Still, there’s something seemingly distasteful about employees of private groups like the IEA using higher wage rates to spike pensions.
One lawmaker, Rep. Kelley Packer, R-McCammon, told IdahoReporter.com last year she planned to address the problem, but has since flipped her position.
“We’re not going to address it,” she told IdahoReporter.com. “Our system is not at risk.”
Packer said federal regulations, reformed in years past, now prohibit private groups from participating in taxpayer-funded pension systems. At the end of last year, she and PERSI officials investigated if Idaho’s system faced punishment for still including those groups on the state systems. After looking, Packer said the federal reforms included a grandfather clause, meaning Idaho is safe.
The McCammon Republican said with that assurance, she won’t take up the issue. She pointed out, though, that PERSI staffers have turned away other private groups from participating in the system.
House Commerce and Human Resources Committee Chair Stephen Hartgen, R-Twin Falls, told IdahoReporter.com he hasn’t heard any other talk of lawmakers looking to solve the problem. Any legislative fixes would likely flow through Hartgen’s committee in the House.
The IEA is hardly the only private group participating in Idaho’s public system. Other participants include the Idaho Association of Cities and the Idaho Association of Counties, among others.
Those groups say because they serve a public purpose -- the county group helps administer an indigent health care program -- they qualify for PERSI.
Packer’s plan would not have ripped benefits away from active employees, but rather would have barred new private workers from joining Idaho’s pension system.