Pension Re-Amortization Discussions

Governor Ned Lamont and the coalition representing state labor unions – SEBAC, have agreed to re-amortize pension debt to find between $130.7 and $140.7 million per year in budget savings. There will be no change to the pension benefits for the state employees, but the pension liability attributable to those pensions earned as of 1984 will be fully funded by 2047, instead of by 2032 under the current plan. The union coalition has stated “Completing the re-amortization of the state pension fund, adjusting the schedule to pay off Connecticut’s pension debt, will help stabilize state pensions and ensure obligations to current and future retirees are fully funded; it was included in the recently passed budget along with re-amortizing the Teacher’s Retirement Fund.” According to Melissa McCaw, “This will allow the state significantly more sustainability in budgeting, honoring our commitment while in alignment with revenue growth, which is helpful in the near term and for the decades ahead. Connecticut has faced pension problems for generations and the agreement announced today is in furtherance of the state’s commitment to a sustainable financial path while working towards a healthier and well-funded retirement system for our employees.”

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