Search
Back

Malloy proposes “colossal cost transfer” onto towns for Connecticut teacher pensions

Gov. Dannel Malloy proposed a new way to fund Connecticut teacher pensions Friday with towns and cities contributing one third of the costs or roughly $407 million.

“At a time when state government is making difficult cuts to services, we can no longer afford to exclude how we pay for teacher pensions from the conversations,” Malloy said in a statement.

The governor’s statement also indicates that the costs will rise in the coming years, moving from $407 million to $420 million the following year.

Joe DeLong, executive director of the Connecticut Conference of Municipalities, said the proposal amounted to a “colossal cost transfer” and is “tantamount to a $1 billion bill to property taxpayers across Connecticut” over the next two years.

If the governor’s teacher pension proposal goes through it could leave many Connecticut cities and towns in a tough financial situation. According to the governor’s figures, towns and cities would have to contribute 10 percent of teacher payroll into the plan.

Many of Connecticut’s largest cities do not have the resources to make those contributions. Hartford, in particular, would be on the hook for an additional $22 million.

New Haven would be looking at a contribution of more than $12 million, based on the city’s 2015 budget.

However, cities such as Hartford and New Haven already qualify as distressed municipalities and receive help from state government.

The extra burden placed on distressed municipalities would likely be lessened or eliminated by the state, leaving the bulk of the pension contributions to be paid for by Connecticut towns.

For instance, Hartford’s wealthy neighbor, West Hartford, would be forced to contribute $10 million per year.

Danbury, whose Mayor, Mark Boughton, was the head of the Connecticut Conference of Municipalities, would likely pay more than $7 million toward the teacher pensions.

Suzanne Bates, policy director for the Yankee Institute said such proposals show how “out of control” teacher pension costs have become and emphasized the need for pension reform. “If Governor Malloy is going to ask municipalities to help pay for teacher pensions, then municipal leaders should get a say in how those benefits are set.”

There are currently 86,000 active and retired teachers enrolled in the Connecticut State Teacher’s Retirement System. Teachers pay 6 percent of their salary into the system and the state contributes 30 percent – approximately $1.2 billion per year.

Earlier in the week, Malloy released a list of proposals to reduce state mandates for towns such as raising the prevailing wage threshold and allowing towns to negotiate contributions into the municipal employee retirement system.

The proposal is part of Malloy’s overall budget which he will present to the General Assembly on Feb. 8.

DeLong added that CCM was looking “forward to having conversations with state officials about best pathways for economic and social success for Connecticut.”

House passes police transparency bill after overnight debate

Meeting in special session, the Connecticut House of Representatives yesterday voted on an eclectic range of bills, with the most controversial centering on police reform and voting changes. Protesters outside the Capitol included unionized nursing home workers and teachers; police; self-designated representatives of Black Lives Matter; and the ACLU.   The session began with Representatives testing technology and working out technical bugs. Most representatives connected to session electronically from their ...

Read More

Employee raises to cost UConn $20 million as university cuts management and athletics

The University of Connecticut is facing an estimated $50 million budget shortfall due to the COVID-19 pandemic and is having to furlough managers and cut its athletics department to make up for the deficit.  Although the school faced a loss after having to send students home midway through the spring ...

Read More

Leave a Reply

Your email address will not be published. Required fields are marked *

SIGN UP TO RECEIVE OUR NEWSLETTER