While the 2019 Oregon Legislature did pass one law aimed at bringing reason to the state’s Public Employees Retirement System, that effort must not be the end of the reform road. Too many problems remain, and a pair of ballot measures being prepared by former Democratic Gov. Ted Kulongoski and former Republican lawmaker Chris Telfer, who used to represent Bend in the Legislature, would strengthen the new law. They’ve taken a step toward getting their proposals on the ballot. Hard work remains.
The Legislature’s effort, Senate Bill 1049, does a couple of things. It stretches out the length of time required to pay the state’s unfunded liability in the pension system, and that should help ease the pain nearly every public employer in Oregon will face in the next few years. Of course, that’s just like taking longer to pay off a credit card bill. State taxpayers will end up paying more.
The bill also required that public employees put at least a bit of their own money into the retirement system, something they haven’t done since 2004. Finally, it caps how much PERS will pay out to future employees at well under the nearly $1 million that goes to Dr. Joe Robertson, a former head of Oregon Health & Science University. After Jan. 1 the cap is $195,000 a year.
Those reforms are a beginning. The ballot measure efforts led by Kulongoski and Telfer would be a vital next step, and the pair is off to a good start. They have turned in the necessary 1,000 signatures for each that allows them to work on ballot titles and, ultimately, begin the job of gathering 112,020 signatures each to place them on the ballot.
Initiative Petition 22 would give new state employees an option: Join a 401(k)-style plan and contribute 6% of their salaries, matched by employer contributions, to their accounts or stay in today’s plan without the current supplemental accounts now available. Again, as of July 1, 2021, they’d have to put in 6% of their own money.
IP 23 would also reinstate employee contributions to the retirement system and have lawmakers study and recommend a 401(k)-style plan for adoption.
Gathering a total of more than 224,000 signatures is no slam dunk, even with paid signature gatherers. It’s a reachable goal, however, and an important part of the effort to reform PERS.