Connecticut lowered the discount rate of the teacher’s retirement system from 8.5 percent to 8 percent in 2016, but it still remains higher than most other states. According to NASRA the median discount rate has dropped to 7.5 percent.
Pension and healthcare costs for employees with the Department of Transportation grew $30 million over three years, increasing operating costs for Connecticut’s beleaguered Special Transportation Fund. According to figures from the State Comptroller’s Office, between 2014 and 2017 state pension contributions increased $21 million, while healthcare costs increased $9 million.
The number of retired state employees receiving six figure pensions jumped by at least 30 percent since 2016 and more than 1,000 percent since 2010. According to a report by the Hartford Courant, there are now “nearly 1,400” retirees who received more than $100,000 in pension payments over the course of 2017.
Connecticut has spent $13.9 million more in overtime for state employees during the first half of this new fiscal year than it did in 2017, according to a report by the Office of Fiscal Analysis. Connecticut had been making headway in reducing overtime spending since a high of $256.1 million in 2015. In 2017, Connecticut spent a total of $204.4 million.
Connecticut has the most underfunded pension system in the nation, amassing more than $127.7 billion in liabilities, according to an annual study by the American Legislative Exchange Council.
There are only a few states that generally rank lower than Connecticut in terms of fiscal stability and outlook and New Jersey is usually one of them. Like Connecticut, New Jersey is saddled with high taxes, major pension problems and fiscal mismanagement, but a new study released by the Garden State Initiative uses Connecticut’s history of raising taxes to solve those problems as a “cautionary tale."