Updated October 30, 2026. Quick answer: Idaho PERSI applies an annual postretirement allowance adjustment (PAA) to the March retirement benefit. The 2026 PAA was 1%, effective March 1, 2026, and PERSI also paid a separate 1.7% retroactive adjustment to eligible retirees. The March 2027 adjustment is not set yet: the Board considered the 2026 adjustment at its December 2025 meeting.
More on public pension retirement ages and eligibility: the Idaho PERSI retirement age and eligibility rules.
How the PAA works
PERSI’s adjustment page says: “Idaho Code 59-1355 provides for an annual Postretirement Allowance Adjustments ( PAA ) to be applied to the March retirement benefit.” “The PAA is tied to the change to the Consumer Price Index (CPI-U) for the twelve months ending the previous August. A PAA of greater than one percent is subject to legislative approval.”
The 2026 notice explains the standard adjustment: “If the CPI-U change is 1% or more, a statutorily required 1% automatic PAA is granted in March of the subsequent year.” Idaho Code 59-1355 adds: “The adjustments provided under this section shall in no event reduce a benefit payment below its initial amount.” On timing, the statute says: “An adjustment year shall extend from March through the following February. The index month is October for adjustment years commencing before March, 1990, and is August for subsequent adjustment years.”
The 2026 adjustment
PERSI’s 2026 notice reports: “If the CPI-U change is 1% or more, a statutorily required 1% automatic PAA is granted in March of the subsequent year. The CPI-U for August 2025 was 2.9%, therefore the 1% becomes effective March 1, 2026.” It also says: “The Board voted to recommend a 1.7% retroactive PAA stemming from 2022 adjustment year, subject to legislative approval.” The notice states the legislative outcome: “The forty-fifth day was Wednesday, February 25, 2026, therefore, the Board recommendation for PAA and retroactive PAA will commence on March 1, 2026.”
Who is left out of the retroactive part
The notice warns: “NOT every retiree will receive a retroactive adjustment payment.” It explains: “Retirees that will receive the full retroactive PAA will be those who had a date of last contribution (DLC) prior to 2/28/2021 or earlier.” The notice’s table sets the share for later retirement dates, so check it against your own date. The sources read cover the PERSI base plan; they do not address the Choice 401(k) Plan.
Where 2027 stands
The March 2027 adjustment is not set yet: the PERSI Board considered the 2026 adjustment at its December 2025 meeting, and this page updates when PERSI publishes the 2027 figure.
The statute says: “The board’s proposed inflation factor for any adjustment year shall be communicated by letter to the legislature by not later than January 15 prior to that year.” PERSI’s adjustment history page, as read, ends with the 2025 rows and has not been updated with the 2026 figure, which is why this page relies on the 2026 notice.
A worked example
As a computed illustration (not a source figure), a retiree with a monthly benefit of $2,000 (invented, for the computation) would see a 1% adjustment of $20 (computed) a month.
Common mistakes
- Adding the 1.7% retroactive adjustment to every retiree’s 2026 raise. The notice says not every retiree receives it.
- Expecting more than 1% without legislative action. The PERSI page says an adjustment greater than one percent is subject to legislative approval, and the statute sets further conditions on a larger one.
- Looking for a 2027 percentage before PERSI publishes it. The 2026 adjustment was considered at the December 2025 Board meeting, and no archived PERSI source shows a March 2027 figure.
Related: Idaho PERSI retirement decisions, how public pension decisions work, and whether Idaho taxes pensions.
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Answer againSources
- PERSI, Retiree Allowance Adjustments: www.persi.idaho.gov
- PERSI, PERSI Retirees: Postretirement Allowance Adjustment (PAA) & Retroactive PAA: www.persi.idaho.gov
- Idaho Legislature, Idaho Code 59-1355 postretirement allowance adjustments: legislature.idaho.gov
- Related official page (not quoted): IRS Tax Topic 410, Pensions and annuities: www.irs.gov
- Related official page (not quoted): IRS Tax Topic 411, Pensions: the General Rule and the Simplified Method: www.irs.gov
Read from the primary documents linked above on October 30, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer or the IRS itself is the right place to confirm anything consequential.