House Bill 499 – Granting Police Constable Membership to Emergency Communications Officers for Retirement Purposes

Description of the invoice: House Bill 499 recognizes emergency communications officers as police officers in an effort to provide them with more favorable retirement benefits.

Rating: -1

Does it increase government spending (for nefarious purposes) or debt? Conversely, does it reduce public spending or the debt?

Typically, Idaho state employees wait until they reach age 65 before they can collect the benefits they earn from the Idaho Public Employment Retirement System (PERSI ). However, employees can receive their benefits earlier if the sum of their age and years of service equals 90. This provision is known as the rule of 90.

Due to the physical and mental strain public safety workers experience on the job, they are allowed to collect retirement benefits earlier than other PERSI recipients. Rather than retiring under the rule of 90, they can take advantage of something called the rule of 80. Under this rule, employees can collect their benefits once the sum of their age and years duty is 80. Under Title 59, Idaho Code, this option is open only to police and firefighters.

HB 499 defines approximately 580 Idaho emergency communications officers (dispatchers) as police officers for retirement purposes, qualifying them for the rule of 80. This would increase government spending on PERSI contributions by 0, 34%. This translates to $69,000 to $132,000 in additional annual expenses statewide.


Analyst Note:

While this appears to be a small increase in benefits for a select group of employees, it could have significant implications for the structure of the PERSI benefit system. Many rationales can be made as to why many state employees should qualify for the Rule of 80. In this case, the statement of intent for HB 499 highlights the market value of retiring earlier when recruitment of dispatchers. Other public bodies can and do make similar arguments for their employees. Opening up this aspect of the program beyond firefighters and police officers could make state pension plans a bigger expense down the road.

Despite the fact that PERSI is now well funded, it is important to remember that we are in an extremely long bull market by historical standards. Once an employee retires, he no longer contributes to PERSI and his pension must be covered by other active members and contributors. Given the current trajectory of the US economy, it is irresponsible to expand government obligations to PERSI pension plans.

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