BOISE - Judie Wright was set to retire from her post as Director of the State's Human Resources division in July of 2010. But when Governor Otter's budget director had to cut more than $90,000 from the division and was considering laying off an administrator, Wright made a proposal.

She said if she could retain all her retirement benefits from the eight months she had left as director, she would quit -- effectively saving the administrator's job. The budget director, Wayne Hammon, would do both jobs for the next eight months and that state would save thousands of dollars.

"At the end of the day the transaction saved $20,000 and a job," Hammon said. "That made it worthwhile."

State Representative Anne Pasley-Stuart (D) says the deal doesn't smell right.

"It come off smelling like a severance package," she said. "It doesn't say it but it still quacks like a duck."

Under Idaho Statute 67-5342, severance pay is prohibited for former employees. That statue only covers money going directly to employees, however, and upon their termination -- not resignation.

Hammon says everything is legal. Another statue, 59-1363, grants employers (like the state) the right to add up to 48 months of PERSI contribution under any circumstance.

"They've passed a law that says this is an option for agencies," he said. "I checked with the attorney general's office to make sure we're following the letter of the law and I think everyone agrees, the law was followed."

The Idaho Association of Government Employees says even if the buyout is legal, it isn't fair. Their spokesman, Daniel Wolf asks why only close friends of Governor Otter able to take an early retirement buyout.

"If they say that they're saving the state's money, let's offer it to other state employees because it's not fair to Idaho public employees that one person gets this deal and others are left nothing," he said.

Hammon says a larger-scale state employee buyout program would need to be created by the legislature. For now his office are just looking at these buyouts on a case by case basis.

"It cannot be done on a case by case basis because that just shows favoritism," Wolf argued.

Pasley-Stuart doesn't think the Governor's office is telling the whole story about the terms and reasons behind the buyout and thinks the savings are overstated.

"It hasn't saved one cent. It hasn't saved one FTE or one dollar," she said.

Hammon says these dire times call for dire measures. That's why he's taking on both the position of Budget Director and Director of the Human Resource division for at least the next eight months.

"At this point pretty much anything is on the table," he said. "If it's going to save the state money and the job can get done, it's something we should look at."