Governor-elect Ned Lamont will face a daunting task when he and fellow Democratic lawmakers assume full control of the state’s finances in January, according to a newly released report by Truth in Accounting.
Teachers Retirement System
State Treasurer Denise Nappier offered a presentation to the state’s Pension Sustainability Commission outlining the difficulties facing Connecticut’s Teachers Retirement System and suggested transferring $3 billion in state assets and bonds to teacher pension system.
Gov. Dannel Malloy’s budget chief offered a roadmap for Governor elect Ned Lamont’s new administration, which included eliminating scheduled tax cuts, cutting back Medicaid, reducing state aid to some municipalities, and transferring some teacher pension costs onto towns and cities.
Connecticut’s new Pension Sustainability Commission held a press conference today in the Legislative Office Building to announce its mission: to consider transferring state assets to Connecticut's pension funds to help reduce the state's unfunded liabilities.
Connecticut has made its full annual payment and reduced the discount rate for its pension plans, but according to a study by Pew Charitable Trusts the state is still not contributing enough to prevent pension liabilities from growing.
In a clear demonstration that discount rates matter for pension funds, Connecticut saw its pension liabilities increase by $9 billion after lowering its estimated rate of return by a total of 1.6 percent for its two major pension plans.