State Representative Nicole Klarides-Ditria (R‑105) voted against the pension funding deal brokered by Governor Dannel Malloy and union leaders on Wednesday.
“I didn’t run for this office to punt our unfunded pension liabilities onto future taxpayers,” said Rep. Klarides-Ditria. “Spreading out our payment obligations from 2032 to 2046 is not only reckless but fails to address our underlying problem of out of control state spending. We need to end the secret backroom deals and have all the stakeholders at the table to solve our pension woes.”
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.
