I have to extend a huge thanks to PERSI's Executive Director Don Drum for dispelling the rumors going around that PERSI was going to move to a defined contribution plan. Before the Joint Finance-Appropriations Committee today, he said once and for all, it's not true.
He also helped us dispel these rumors in our Weekly E-Newsletter last week, which goes out to all schools and districts. Here's the message from Drum that went out in our Newsletter:
Governor Otter has faced some extremely challenging budget issues in the past few years. I believe when such challenges arise you must alter well intended plans, prioritize issues and in Idaho balance the budget. The governor has worked closely with JFAC and they are leading Idaho through the challenges of the economic recession.
I have spent the summer and fall meeting with employers, legislators and members. I have also spoken with the Governor. All parties understand the value of the PERSI benefit. All parties desire to retain the benefit and sustain the PERSI fund. The PERSI fund was not immune from the economic downturn. We ended fiscal year 2009 with a 73.4% funded ratio and a $3.2 billion unfunded liability. I believe all parties were concerned about the sustainability of the fund.
Today we have experienced a very strong recovery. Our funded ratio is over 88% and our unfunded liability has dropped to just over $1.4 billion. The legislators I have spoken to are pleased with our recovery and none of them are aware of any other legislator who is working on changes to PERSI. The system is sustainable, and we believe we can achieve full funding in 3 to 5 years without benefit changes.
PERSI has an excellent working relationship with all the legislators and especially with the Governor. All parties understand the PERSI benefit is important to employers in attracting and retaining quality staff. All parties appreciate the importance of this benefit to Idaho’s public employees. We must continue to take the appropriate actions to protect the sustainability of the fund.
~ Melissa M.