A Worker Benefit for Computer Age: Interest-Free Loan for PC

The era of the company car and the fat pension may be coming to a close, but thousands of government employees in San Diego County are eligible for a unique alternative: personal computers for as little as $7 a week.

“This is the second-best employee benefit” after medical insurance, said Nadine Armenta, a county mail clerk driver who is eagerly awaiting the arrival of a generously equipped PC that will cost her $14 a week. “This was the opportunity of a lifetime to take advantage of.”

With 16,100 permanent workers, San Diego County is believed to be the largest local government employer in the country to adopt a PC purchase incentive program. Employees who sign up this month can spend as much as $3,000 on computer hardware, software and add-ons, such as printers, for their personal use at home. Participants receive a 30-month interest-free loan arranged by the county.

The program, proposed by San Diego County Supervisor Pam Slater, requires the county to set aside $500,000 for 2 1/2 years to cover any employees who leave their jobs and subsequently fall behind on their loan payments. But the financial benefit to county taxpayers comes from reducing the need for basic computer training courses, said Gary Clarke, manager of planning and special projects for the county’s Department of Information Services.

“The result is the county will have a more computer-literate work force,” Clarke said. “Overall, we can save taxpayer dollars by channeling our training dollars toward specific skills training instead of general skills training.”

D’Arcy Roper, a manager with the National Institute of Government Purchasing, said that in his opinion, programs like the one in San Diego County that involve payroll deductions are rare--and sometimes troubling.

“As a taxpayer, I resent one group of taxpayers having an advantage over another group of taxpayers simply because they work for the government,” Roper said. “It’s not fair. It’s not illegal, clearly, but I question the ethical underpinning of programs like that.”

According to a recent poll by the Reston, Va.-based trade group, about 8% of the 341 governmental agencies surveyed have arranged contracts for employees to receive discounts on items for their personal use, Roper said.

The city of San Clemente initiated a program in 1990 allowing employees to spend as much as $3,500 on computer equipment and software with interest-free loans that can be repaid through payroll deductions. Between 150 and 200 employees have participated in the program so far, said Kumi Johnson, San Clemente’s budget officer.

Officials from the League of California Cities and the California State Assn. of Counties, both in Sacramento, said they were not aware of any other similar programs in the state. Representatives from the city of Los Angeles and Orange and Los Angeles counties said they did not have any PC-purchase incentive programs.

Slater first suggested the county help its workers buy PCs in February, when the Board of Supervisors found it had extra funds in its budget. Her initial plan was to loan county money directly to employees. The $500,000 the board was willing to set aside would cover between 150 and 200 loans.

But when she sent out a survey to gauge employee interest, she received favorable responses from about 9,000 people, Slater said.

In the first three weeks of the sign-up period, county employees placed 3,758 orders for computer systems worth more than $8.6 million. The deadline for participating in the program is Friday.

To accommodate the demand, county officials devised a way for special financing companies to pay for the computers purchased at selected PC retailers. The county will reimburse the financing companies--without interest--by deducting payments directly from workers’ paychecks over 30 months.

By contrast, if someone were to charge a $3,000 computer to a credit card with a standard annual percentage rate of 16%, the interest payments would add about $660 to the total.

Employees can purchase one of four package deals from Gateway Inc. or buy any item available from Datel Systems, a San Diego computer retailer. After shopping in a store, over the phone or online, employees just fill out an order sheet and submit it to the county personnel office.

“I make clerical wages,” said Barbara Greenleaf, an employee in the county’s information services department whose new computer and printer--worth just under $3,000--will cost her less than $24 a week. “To me, the opportunity to buy something like this is just really exciting.”