CT State Reps. Sam Belsito And Tim Ackert Vote Against Pension Funding Agreement

From CT State Reps: State Representatives Sam Belsito and Tim Ackert voted against the pension funding agreement brokered by Governor Dannel Malloy and union leaders on Wednesday.

“Once again, the Governor and union leaders want to play shell games with Connecticut residents,” said Rep. Belsito. “Rank-and-file state employees want to us to fund the pension system and stop spending taxpayers’ money recklessly. This plan will continue to push our unfunded pension liabilities down the road, jeopardizing Connecticut’s fiscal climate.”

“I am in support of paying down the indebtedness of our pension obligations, and unfortunately, this does not accomplish this,” said Rep. Ackert. “Over the next two years, we actually reduce the contributions to our retirement account. This is not the financial fix that the state residents are asking for and needs.”

The Governor’s refinancing scheme will cost less over the first half of the agreement, but in the second half, costs remain significantly higher compared to the state’s current schedule of contributions. In the end, taxpayers will be spending $11 billion more over the life of the agreement.

Republican legislators released two actuarial analyses that provided steps the state of Connecticut can take to reform pension plans. These structural changes in the Reason Foundation report include:

• adopting a defined contribution retirement plan for new hires
• increasing employee pension contributions to 4%, and capping cost of living adjustments to 2% - which would save the state approximately $100 million annually

Pew Charitable Trusts confirmed that if the state found $200 million in savings and sent that money back into the pension fund, it would cut seven years off the length of the refinancing, thereby saving taxpayers billions in future payments.

The scheme only put a dent in the next biennial budget cycle, only reducing the state’s deficit over the next two years from $3.81 billion to $3.47 billion.

Later in the day, Lt. Governor Nancy Wyman voted in favor of the pension agreement in the evenly split State Senate that broke a party line 17-17 vote, clearing it for passage in the legislature.

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