Members in the PERSI plan are automatically enrolled once they enter into government employment

Members in the PERSI plan are automatically enrolled once they enter into government employment

What Types of Idaho State Pensions are offered?

The majority of Idaho state employees are covered under the Public Employee Retirement System of Idaho (PERSI).  Under this administration, employees may select the basic defined benefit plan or may elect to contribute in a voluntary 401k investment plan.  PERSI also administers a separate pension plan for Idaho state firefighters.

In addition, there is a separate retirement fund for appointed and elected judges, which is administered separately from the PERSI.

The state pension fund reached a high funding level of 104% in 2007 but had fallen to 79% in 2012.  As of 2013, the pension fund is funded at 89%, which is above the recommended federal level of 80% funding.  This positive increase demonstrates that recent fiscal responsibility has contributed to a rise in the retirement program.

Base PERSI Plan Eligibility and General Requirements

Members in the PERSI plan are automatically enrolled once they enter into government employment.  The plan is extended to all state employees, although judicial members may opt to apply for the separate Judicial Retirement Fund.

Members of the PERSI fund contribute 6.79% of their monthly salary to their retirement fund.  Employers contribute an additional 11.32%.

The standard age of retirement is 65 with at least 60 months of service credit.  Members may apply for early retirement at age 55 with an unreduced monthly benefit if their age plus months of service credit equals at least 90.  If this requirement is not reached, members may retire early but will receive a monthly benefit reduction based on their accumulated months of service credit.

Employees are considered vested after they have attained at least 60 months of service credit.

Employees who terminate employment but have reached vesting requirements may elect to leave their retirement funds intact and receive their normal monthly benefit at the standard retirement age.  Employees who have not reached vesting requirements are entitled to a 100% refund of their contributions, plus interest.  Employer contributions are not refunded.

Employees who retire may continue to work for a PERSI employer without affecting their retirement payment as long as their employment is on a strictly part-time basis (20 hours or less a week.)  Employees who work for a non-PERSI employer after retirement will not see any effect on their retirement benefits.

Retirees under the PERSI plan are eligible for an annual Cost of Living Adjustment.  This COLA is tied to the Consumer Price Index and may not be more than 6% annually.  The COLA is determined by the Retirement Board every year and paid out to retirees in March of each fiscal year.

Service Credit Requirements

Service is calculated monthly based on time worked under state employment.

Under certain situations, existing service may be converted or purchased into additional years of service credit.

These include:

  • Active military service
  • Approved sick leave or leave for personal reasons
  • Past service accrued under a different state agency, but not previously credited.  This includes out-of-country government service and teaching for another state’s public school system.
  • Employees may purchase additional service credit for any reason, though this can be quite expensive.  Additional service credit can be used towards vesting requirements in order to retire at an earlier age.

Employees who terminate employment forfeit their service credit if they do not return to service within a 5 year span.  Previous employees may buy back previously-earned service credit if it has already been forfeited.

Employees who change employers under the PERSI program do not need to transfer their funds, as their contributions will remain in their PERSI account and continue accumulating.

Members who are employed as a police officers, firefighter, or qualifying public safety officer have some differing retirement benefits

Members who are employed as a police officers, firefighter, or qualifying public safety officer have some differing retirement benefits

Survivor Benefits

In the event of a non-vested employee’s death, their surviving beneficiary will be paid a lump sum payment equal to the employee’s retirement contributions, plus interest.

Vested employees who were hired after July 1, 1999 may elect for their beneficiary to receive a “double death benefit,” which is equal to double the employee’s monthly retirement contributions, plus interest.  Employees may also opt for their beneficiaries to receive a lifetime monthly benefit.

Disability

Employees who sustain a disability while under state employment may be eligible for lifetime monthly disability benefits.  These disability benefits are awarded after a medical examination occurs.

Employees must have at least 5 years of contributed service to apply for disability benefits.  Disability benefits are paid out until the employee’s death, eligible retirement age (if retirement requirements are met,) or end of employee’s disability.

Police and Firefighter Special Benefits

Members who are employed as a police officers, firefighter, or qualifying public safety officer have some differing retirement benefits.

  • Police officers and firefighters may retire at age 60 after attaining at least 60 months of service credit.
  • Police officers and firefighters may retire early at age 55 with an unreduced monthly benefit if their age plus months of total service equals at least 80.
  • Public safety officers injured in the line of duty may be eligible for a lump sum payment of $100,000.  This application must be approved by the Retirement Board.
  • The beneficiaries of police officers, firefighters, and public safety officers killed in the line of duty may be eligible for a $100,000 lump sum payment.  The eligibility for this payment is determined by the Retirement Board.

For more information about eligibility as a public safety officer and any other differing benefits, please consult the PERSI member handbook.

401k Investment Plan Basic Benefits

Alongside the PERSI plan, members may elect to participate in the Idaho 401k Investment plan.  The advantage for this plan is that members have full control over the investment of their retirement funds.  Participation in this plan is completely voluntary.

There are 12 separate investment options for the 401k plan.  Members are individually responsible for the investment and management of their funds.

Members who have at least $2,000 accumulated in their 401k fund may apply for a short-term loan for any reason.

Funds that are a part of other 401k or retirement plans may be rolled into the Idaho 401k plan and added to the account balance.