Connecticut has been meeting its payments for the past few years. This is commendable and responsible behavior. Too many states, fearing the immediate implications of budget crowd-out, choose to pay less than 100 percent of their required contributions. However, the Connecticut pensions systems’ structural problems make even 100 percent payments woefully insufficient. Debt levels are going up, in part because of inflated discount rates.
Twenty-five years ago Gov. Lowell Weicker vetoed a state budget. In his veto message, he got one thing right. “We will not set employment levels and then drum up programs to make work,” he said. To this day, Connecticut doesn’t set priorities. We start with state employees and end with ...
Connecticut voters overwhelmingly approved a constitutional spending cap in 1992, but lawmakers still haven’t defined the three terms in the amendment that would make it work. Earlier this year, lawmakers created a Spending Cap Commission to recommend definitions. The hope is that lawmakers will adopt them next year. The commission has ...
Connecticut union leaders signed off on pension underfunding each time it happened, according to the state’s top union official and expert testimony before the Spending Cap Commission last month. At the Sept. 26 commission meeting, AFL-CIO President Lori Pelletier said union leaders agreed to underfund the state employee pension in exchange for better benefits for workers, even though they knew it was “not a good idea.” Pelletier said Connecticut is now “left holding that basket.”
The Securities and Exchange Commission censured the town of Fairfield last month for failing to file timely financial reports and disclose that information in their bond offering documents. Fairfield told investors that it had only been late on its 2009 and 2010 reports. According to the SEC, “this was materially misleading because Respondent filed its fiscal 2006, 2007, and 2008 audited financial statements by 1,384, 1,017, and 652 days late, respectively.” The SEC goes on to say that the Town of Fairfield “knew or should have known that this statement was untrue.”
The state’s constitutional spending cap should be “comprehensive” and cover all state spending except for debt service, Webster Bank CEO James C. Smith told members of the Spending Cap Commission this week. The spending cap is supposed to limit how much state lawmakers can spend – but in recent years money has been moved out from under the cap, weakening it. Smith powerfully made the argument that the state’s spending cap matters – read the rest of his testimony here.