Health-insurance increase and employee-compensation decisions left unresolved after lengthy JFAC debate

The Joint Finance-Appropriations Committee debated two interrelated personnel items ' health insurance funding and change in employee compensation ' but left both unresolved after extended discussion.

Health insurance: Analysts presented two competing FY2026 proposals. The governor's recommendation would raise the health-insurance base to $14,300 per eligible full-time equivalent (FTE), with an estimated total cost of approximately $56,315,200 across all funds (including $42,076,600 general fund). The CEC committee recommended a lower increase to $13,960 per eligible FTE, for a total estimated cost of $40,261,200 (including $29,996,000 general fund). The legislature must also adopt language covering plan structure as one element of the statutory process.

Committee discussion focused on reserve adequacy and the risk of falling below the plan's contractual 10% contingency reserve. Keith Bybee explained Milliman actuarial projections showing a total plan cost around $482,000,000 for FY2026. Under the CEC number the Milliman projection would reduce the contingency reserve to approximately $51,600,000 (near the statutory 10% minimum); the governor's recommendation would leave a larger cushion, about $61,400,000, roughly $10,000,000 more than the CEC path. Office of Group Insurance Administrator Faith Knowlton told the committee, “If we fall below the 10% contingency reserve, then a risk charge can be assessed to the state.” Division of Financial Management Administrator Laurie Wolf said the reserve is a contractual floor and that the actuary's figures reflect a 50% chance of meeting that floor when budgeting to the minimum.

On the motions: Representative Miller moved to adopt the governor's FY2026 recommendation ($14,300 per eligible FTE); Senator Woodward seconded. Representative Furnace offered a substitute motion adopting the CEC recommendation ($13,960); that substitute was seconded by Senator Cook. The substitute motion did not obtain the required majority from both delegations (final tally: 9 ayes, 11 nays total) and the original motion also failed to secure a majority of both House and Senate delegations, so the committee did not adopt either proposal.

Change in employee compensation (CEC): Members spent substantial time debating recommended salary adjustments. The CEC's motion (as presented in committee materials) proposed a flat $1.55-per-hour increase for permanent state employees (which is roughly equivalent to 5% at about $65,000 annual pay and a higher percentage for lower-paid employees), an 8% increase for Idaho State Police trooper pay, a $1.55-or-3%-whichever-is-greater increase for nursing/healthcare workers (distributed on merit), and market-based increases for classified IT and engineering positions. A competing substitute motion proposed an ongoing increase equal to $1.55 per hour or 4%, whichever is higher, with the same targeted increases for troopers and health-care workers and a 4.5% market-based increase for IT/engineering.

During the debate committee members discovered omissions in the packet (nonclassified IT/engineering employees were not included in initial counts). The sponsors amended ballot language to add nonclassified IT/engineering staff and corrected arithmetic. Several members argued for focusing assistance at the lower end of the pay scale; others argued for market-competitive increases for high-skilled positions. After extended discussion the sponsors agreed to withdraw both the substitute and the original compensation motions so staff could update the fiscal numbers and reprint motion language. Committee chairs said the compensation and insurance items will return for further consideration at a later time; maintenance-budget votes scheduled for the next day will proceed without those unresolved items.

Ending: Committee staff will revise motion language and fiscal tables and return the items for a future meeting; meanwhile unanimous-passage items approved earlier will be included in the maintenance-budget documents.