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Connecticut’s state employee pension fund now holds less than 45 percent of the funds its needs to meet obligations to workers, an unfunded liability not seen in over two decades. This comes from a recent actuarial valuation covering the fund's history through the end of the last fiscal year on June 30. The kicker is that it doesn’t even address another $100 million pension contribution that is being deferred in the current year.
This year taxpayers will contribute about $844 million to the fund, a number that is expected increase to over $1 billion next year. Brought on by poor investment earnings and generous retirement benefits, the gap between what the state actually has and what it has promised workers continues to grow. For example, a May 2009 deal negotiated by the Governor Jodi Rell, state employee unions and the General Assembly allowed the state to offer a retirement incentive program in 2009 which increased pension benefits for about 3,800 eligible employees. Now, employees can opt for a short-term salary reduction for the promise of long-term benefit increases, putting further strain on the system.[1]
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Connecticut on Sunshine Review
