HARTFORD – State Representative John Frey (R-111) submitted proposals to the Appropriations Committee for two state pension reform measures this session, calling them “our best chance to reduce the budget deficit.” Unfunded pension liabilities have grown exponentially over the past 20 years, having more than doubled since 2010 to a total of $33.5 billion now.
Rep. Frey’s first proposal calls for prohibiting state elected officials from receiving state pensions. The second bill proposal would eliminate factors such as overtime compensation and mileage reimbursements from pension calculations. He proposed similar bills regarding pension reform last year, but neither concept ended up in the final budget package.
“Our unfunded pension liabilities represent the single most formidable obstacle to fixing Connecticut’s historic fiscal crisis and finally putting us on the path to economic recovery,” said Rep. Frey. “The state made mistakes at several junctures offering labor unions sweetheart contracts that were unaffordable and economic growth has been too sluggish to pull ourselves out of that hole. In spite of the majority party passing the SEBAC agreement to lock in that bad deal for another ten years, I will continue to advocate for sensible reform measures rather than going back to tax increases and cuts to core government services again. We really don’t have a choice at this point.”
Rep. Frey contends that stopping the practice of giving state elected officials state pensions is “a good place to begin” to address Connecticut’s ballooning pension costs.
“Connecticut has a part-time legislature, which means all legislators have access to other pension plans because no one can rely solely on their legislative salaries for their livelihoods,” said Rep. Frey. “Our state’s pension plan is preferable to even the federal pension plan and we can’t afford to be this generous. Eliminating public pensions for elected officials is unlikely to be popular among many of my colleagues, but given our dismal fiscal situation, it is a practical place to start looking for savings – especially when the governor and majority party continue to push more tax hikes and new fees.”
The 2017 SEBAC union contract represented another instance of the legislature delaying making payments to unfunded pension liabilities and 2/3rd of the State Employees Retirement System remains unfunded, something Rep. Frey believes can be addressed by changing how state employees’ pensions are calculated.
“Pension calculation based only on stated income really isn’t a radical concept, especially for anyone who works in the private sector,” said Rep. Frey. “The practice of including longevity pay, overtime pay, and mileage reimbursements into pension calculations is part of the reason our liabilities have gotten out of control. At some point, we have to realize that this is not sustainable.”
“Since the beginning of the 2018 session, we have heard from the governor and from the majority party that the only answer to our fiscal mess is to raise taxes and to institute new fees like tolls, which is basically the state asking it’s taxpayers to bail them out for its irresponsible decisions,” said Rep. Frey. “It is imperative to me that the people of Connecticut understand that raising taxes is not the only course of action for us; we do not have a revenue problem. We have a state spending problem and identifying areas where we can save money on unfunded pension liabilities is a necessary alternative to consider. I will be fighting against tax hikes and in favor of pension reform.”