Lawmakers already in the PERS plan could retain
their accounts and accrued retirement benefits.
However, Under House Bill 2407, once their current
legislative terms end, the elected officials would be
pushed into the new 401(k) plan along with newly
designated legislators, according to a Salem Statesman
“It removes any inherent conflict of interest of us being part of the PERS plan,” said House Majority Leader Tim Knopp, (R-Bend).
Under the terms of the bill, Oregon would
contribute 6% of lawmakers’ salaries into a mix of
investments chosen by each member. Their ultimate
retirement benefits would depend on how well those
investments fare in the market.
A spokeswoman for the majority leader said the bill would save the state $202,267 for the upcoming budget cycle, and more in following years. As the PERS plan sits now, it is starring down the barrel of a roughly $14 billion long-term shortfall.
Knopp acknowledged that the participation in PERS
by lawmakers has been a sore point with the
This is due in part to some officials
who went on to earn lucrative PERS
benefits by moving into other public sector jobs after
leaving office. They took advantage of rules that set
retiree benefits, in some cases, pegged to the PERS
member’s three highest years of salary. Three years as a
state agency manager could cause their legislative
pension to balloon.
However, despite the public perception of legislators making off with heavy retirement payouts, the bulk of lawmakers retire with PERS benefits of only $100 to $150 per month, Knopp argued.
Offering a dissenting opinion to the bill was a lobbyist for the American Federation of State, County and Municipal Employees (AFSCME) Mary Botkin. She contends the new plan may keep some good candidates from running for the Legislature.
Currently, Oregon state l awmakers earn $15,396 per year, plus expenses, keeping with the state’s preference for a “citizen’s Legislature,” not a body of professional politicians. But, Botkin argues, “Being a legislator is not a part-time job any more. We don’t pay them very much; the least we can offer them is a decent retirement system.”