On Wednesday, Feb. 1, State reps. Whit Betts (R-78), Cara Pavalock-D’Amato (R-77), and State Rep. William A. Petit, Jr. (R-22) and State Sen. Henri Martin (R-31) urged fellow lawmakers to reject Governor Dannel P. Malloy’s pension funding agreement and instead urged the legislature to assess alternative means by which to address the state’s growing pension system problems, reported a press release from House Republicans.
House Republicans released data obtained from two actuarial analyses that show how additional steps can rein in the state’s unfunded pension liabilities, said the press release. Both reports show how paring pension finance changes with modifications to state employee benefits could increase the solvency of the state pension plan.
“I voted no to the proposal to refinance the state pension plan because it included adding $11 billion (which represents more than 50 percent of the entire state budget) in Connecticut taxpayer dollars to the state pension plan for state employees,” said Betts, according to the press release. “Taxpayers did not receive any financial relief from this agreement. Furthermore, this agreement imposes an $11 billion financial obligation on our children and grandchildren.”
“This agreement, which was made without the legislature’s input, does nothing to fix the current problem facing the state to fund pensions, but instead pushes payments out farther and puts the responsibility on future generations to pay for it,” said Pavalock, the GOP release said. “In any household, people pay the debt which they acquire; they do not take out loans and hand them over to their grandchildren to repay. Yet this is exactly the agreement orchestrated by the administration and union leaders and it is frankly disheartening.”
“I voted no in the Appropriations Committee as well as in the House session on the pension re-amortization resolution because although it had several helpful end-points (reduce deficit in fiscal ’18 and ’19, even out payments) the cost is far too high,” said Petit in the press release. “Our actuaries tell us this will cost taxpayers an additional $11 billion dollars over 30 years…$366,666,666 dollars per year for 30 years or $1 million dollars a day for 30 years. This is not a fiscally sound plan and I could not put my support behind it.”
The GOP release said the governor’s pension proposal sought to tackle a mounting budget deficit by reducing short-term state pension contributions. In exchange for leveling payments through 2047, the Republicans said taxpayers would be responsible for an additional $11 billion over the duration of the deal compared to the structure of the current plan.
“I think it is simply wrong to pass this future debt along to the next generation. This agreement may be good for the unions, but not necessarily for the people of Connecticut,” added Martin, according to the press release. “Also, by approving this agreement, we avoid the wider picture. The discussion needs to not only address the unfunded pension obligation, but changes to the SEBAC agreement. We have to get state spending under control and put measures in place to guarantee that it stays under control.”
The GOP press release said many Republican lawmakers have suggested that making alterations to state employee pension benefits could reduce the unfunded liability by $200 million. If that sum were sent into the pension fund, the press release said actuaries estimate that the length of the new plan could be reduced by seven years and could decrease the additional liability from the projected $11 billion to $3 billion.
The state House voted 76 to 72 to approve the deal on a nearly party-line vote, while the state Senate voted 18-17 with the Lt. Gov. Nancy Wyman casting the tie-breaking vote in favor of the deal.