PERS, It’s Not Just About Public Employees

The Oregon Public Employees Retirement System (PERS) was created by the Oregon legislature in 1945.  Its purpose was and still is to provide retirement benefits to Oregon’s public employees.  But PERS is about much more than public employees.  PERS affects every Oregonian, in every way that the state provides services.  With one exception, every governmental entity was created for the purpose of providing services to the people, not for providing retirement benefits for public employees.  The exception is PERS itself.

Oregon’s population is estimated at approximately 3,900,000.  See http://worldpopulationreview.com/oregon-population-2012/. Active, inactive and retired public employees number about 330,000.  See http://www.oregon.gov/pers/docs/general_information/pers_by_the_numbers9-2012.pdf.  Public employees make up about 8.5% of the population.

Today, most public employees do not directly contribute to their PERS retirement benefits, although those who pay Oregon taxes do contribute as taxpayers.  PERS estimates that only 30% of PERS members make direct employee PERS contributions but it does not estimate the dollar amount contributed by that 30%. Most likely, it is far less than 30% of the total employee PERS contributions.    For the 70% of PERS members who do not make direct PERS contributions, their public employers pay both the PERS employer contribution and the employee contribution.

Prior to 1979, things were different.  All PERS members were required to pay a percentage of their salary to PERS to help fund their retirement benefits.  But in 1971, legislators were allowed to join PERS for the first time by the Attorney General and most of them did join.  During the next twelve years, PERS legislators significantly increased PERS benefits.  One new benefit created in 1979 was the PERS Pick Up which allowed PERS members to make the taxpayers pay their employee PERS contributions for them.  That’s why 70% of PERS members today make no direct employee PERS contributions.

PERS legislators also forced Oregon’s judges to automatically become mandatory PERS members, starting in 1984.  That stacked the deck in favor of PERS in every PERS lawsuit and protected the benefit enhancements made by the PERS legislators during the preceding twelve years.   By 1989, PERS legislators had elevated PERS funding to Oregon’s highest financial priority, placing it on a pedestal above  every other service that the government provides, including education, public safety and assistance to those in need.

As indicated above, public employers now pay most of the PERS funding contributions.  But all payments made by public employers are really made by the people who pay taxes to that public employer.  So all Oregon taxpayers are affected by PERS.  And so are all of the people who receive services that are provided by the state.  People receiving services are affected because when there is not enough money to fully fund PERS and to provide other services, those other services are cut back to make sure that PERS will be fully funded.  Under laws made by PERS legislators, PERS funding can never be cut back in order to fully fund services.

Despite the fact that every Oregonian is affected by PERS and that 92.5% of the people are not PERS members, when the PERS politicians who control the state legislature and the governor’s office talk about PERS, they only talk about the PERS members.  While that’s not surprising because they are PERS members, it should not be acceptable.

If you do not like the current system where PERS members control the state and they put PERS ahead of everything else, ask your legislative representatives if they are PERS members.  If they are, ask them if their loyalties are to all of the people or just to their PERS brothers and sisters.   Then watch what they do in the legislature on PERS matters.  If you do not like it, let them know.  If they won’t listen to you, look for someone who will.

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About Dan Re

I am an attorney who has lived in Bend and practiced law since 1981. In educating myself about the Oregon Public Employees Retirement System (PERS), I was shocked at how the PERS laws were changed by the legislature, once legislators were allowed to join PERS in 1971, 26 years after PERS was first created. Those changes personally benefitted the legislators who made them at the direct financial expense of the people they were elected to represent. That is wrong and I intend to change it. In 2009, I started a non-profit 501(c)(4) corporation, In RE The People, Inc., for the purpose of informing concerned citizens of what happened regarding PERS and other issues of social and civic importance. I then created this blog to further that objective.
This entry was posted in Oregon judges, Oregon legislators, Oregon legislature, Oregon PERS, public employees retirement plan and tagged , , , , . Bookmark the permalink.

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