Senator Martin, Representative Piscopo Say Pension Reform Must Be Part of Any Deal

State Senator Henri Martin (R-31) and State Representative John Piscopo (R-76) this week voted to reject Governor Dannel P. Malloy’s pension funding agreement as an inadequate measure to address the fund and the state’s budget problems.  The agreement was approved by the General Assembly over objections by Senate and House Republican legislators.

Data from two independent reports (attached) show that pairing pension finance changes with modifications to state employee benefits could increase the solvency of the state pension plan. Instead, the governor’s pension proposal sought to tackle a mounting budget deficit by reducing short-term state pension contributions. The plan to level payments through 2047 leaves taxpayers responsible for an additional $11 billion over the duration of the deal.

“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,” Sen. Martin said. “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.”

Alterations to state employee pension benefits suggested by legislative Republicans could reduce the state’s unfunded liability by $200 million. Additionally, actuaries estimate putting that money into the pension fund could reduce the length of the payment agreement by seven years and could decrease the additional liability from $11 billion to $3 billion.

“This agreement did not go nearly far enough. We had a great opportunity to make some inroads in the budget that would provide long-term solutions to our state’s pension problems and put us on a sustainable path but the administration would not take our suggestions,” said Rep. Piscopo. “Instead, the administration made the decision unilaterally without the legislature’s input.”

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.