March
9, 2016
From:
The Federation of Connecticut Taxpayer Organizations
Contact: Susan Kniep, President
Website: http://ctact.org/
Email: fctopresident@aol.com
Telephone: 860-841-8032
The Federation offers the following extensive report
understanding that a band aid will not solve the state’s $71 Billion Debt and
$6.6 Billion Deficits, the costs of which will be passed on to State and local
taxpayers. We must eliminate the drivers of that debt which
are Binding Arbitration and Collective Bargaining Laws. This is an extensive
report which we believe will provide insight into the impact the State has had
on municipalities and why the public employee unions must be constrained as
taxpayers are forced to pay the unions $100 million while New Jersey fought
back and won.
The State and Its Capital - Hartford - are Broke!!
BREAKING: Brad Drazen reports
Hartford
May Ask State for Financial Help: Sources | Hartford ...
The NBC Connecticut
Troubleshooters have learned Hartford city leaders are
looking into the possibility of asking the state for help dealing with their
troubled finances. Multiple sources familiar with the Hartfords
financial situation tell the Troubleshooters, legislation could be finalized as
soon as tomorrow that would open the door for state oversight. More
The Federation notes that the last time the
State stepped in was in Waterbury
in 2001 as noted within the following
House
Passes Waterbury Bailout Bill - NYTimes.com
Breaking News from the Hartford Courant:
*********************
Malloy
Wants More Budget Cuts
Cuts include $20 Million from Town Aid!
*********************
With cuts in State aid, will property taxes
be increased?
Check how Connecticuts
property taxes compare to other states at 2016's Property Taxes by State | WalletHub
As CTPost notes
in their article captioned
Just
how high are Connecticut's property taxes?
According to this study, Connecticut has the sixth highest real
estate property taxes in the country and the fourth highest vehicle property
taxes.
********************
Any cuts in State aid can drive up local
property taxes as
Municipalities fear big CT
deficits will nix promised state aid.
Malloy
and the State Legislature have already enacted an across the board mill rate of
32 mills on cars while also threatening to enact legislation which would allow
cars to be registered regardless if car taxes were owed or parking tickets were
paid. This would further erode local property taxes which could in turn
force more homeowners and businesses to tax lien sales.
Read more on this issue by CTMirror.org at
Malloy:
Speed DMV lines by shedding 'collection agency' role
**************
TO REVITALIZE CONNECTICUT
END BINDING ARBITRATION
AND COLLECTIVE BARGAINING
The Catalysts Driving
Connecticuts $71 BILLION DEBT
and
Taxpayers from Our State
Flight
of the Billionaires - Hartford Courant
**************
On March 1, 2016, Connor D. Wolf of the
Daily Caller Reported
US Supreme Court Deals Devastating Blow In Public Union Pension Case
The U.S. Supreme Court delivered a devastating blow
to New Jersey
labor unions Monday by declining to hear their case against Gov. Chris Christie
for cutting state pensions. The former
Republican presidential candidate cut state pensions in 2014 as part of a
reform bill designed to address budget problems in the state. A group of public-sector unions, however, were quick to file
a lawsuit to stop the reforms. They argued the cuts violated a contractual agreement
the state had to fund retirement. The highest court declined to hear the case
after a nearly two-year legal fight. Continue reading at http://unionwatch.org/union-in-the-news-weekly-highlights-12/
Connecticut too had a pending lawsuit
brought by the state employee unions, but Connecticut
taxpayers were not so lucky as those in New Jersey!
CT TAXPAYERS MUST PAY STATE EMPLOYEE
UNIONS $100 MILLION
The
power and influence of the Connecticut state employee unions became evident in
January, 2016 when we read in the Hartford Courant article captioned State Begins Paying $100M Tab For Rowland Layoffs. The Courant notes the following - State officials will spend most of 2016
paying an estimated $100 million tab for last years settlement of a
long-running federal lawsuit by unions over Gov. John G. Rowlands
2003 layoff of more than 2,000 state workers. The taxpayer money has already
started flowing.
**************
STATE BUDGET DEFICITS CLIMB AS MANY STATE
EMPLOYEE UNION CONTRACTS ARE DUE TO EXPIRE!
Visit OPM: Office of Labor Relations
Contracts - CT.gov which provides
the status of the state contracts and their expiration date.
$93.9 million
Estimated Cost of new University of
Connecticut Professional Employees Contract
The Yankee Institute in their article captioned
A Convenient Glitch?
notes that The Connecticut
legislature has not rejected
any union contracts since May 1997.
CTMirror.org reports
Raises for UConn professionals spark broader CT budget debate
**************
Two
weeks ago, in a Hartford
Courant article by Christopher Keating captioned
Budget
Deficit For Coming Year Hits $900 Million As ... Economic Woes Worsen
State
Representative David Alexander, a Democrat, asked the following Who the heck is doing our [revenue] projections?'
These numbers shouldn't be this out of whack. You should be able to make
projections that are more accurate than they have [been] for the past year.
Mr.
Alexander asks a fair question especially when a lot of taxpayer money is at
stake as new union contracts are being negotiated. These legally
binding contracts will undoubtedly include increases in salaries and benefits
for State employees. This will translate to also an increase in
pensions.
The
following is an example of what is currently transpiring with the The University of Connecticut Professional Employees
Association contract which was withdrawn due a technicality as noted
within the news article by CTNewsJunkie.com captioned In Face of Democratic Opposition,
Labor Withdraws Contract. Therein, the following is noted - The University of Connecticut
estimated it would cost $55.9 million over five years, but Malloy
administration Budget Director Ben Barnes and the legislatures nonpartisan
Office of Fiscal Analysis pegged the cost at $93.9 million over that same
period of time, a difference of nearly $40 million. Lori Pelletier,
president of the AFL-CIO, said they were disappointed in where the process was
headed, but its a glitch. She said the statute calls
for a supersedence appendix to be filed and it wasn’t
attached to the contract.
Taxpayers are currently paying UConn staff $670.3 Million.
To see
what is already being paid to each employee go to Compensation - Transparency
Connecticut - CT.gov, Click on
Advanced Search, click on Agency then go to University of Connecticut, next go
down to the Search button, click it, and then go over to the last column and
click the word Total twice. This will bring you to the highest to lowest
paid. The top ten range from $427,018 to a high of $2,968,505.
Governor
Dannel Malloy and the Democrat
Controlled State
Legislature must end their charade to drive down the States multi billion
dollar debt ($71 Billion) and deficits ($6.6 Billion) while continuing to
pander to the unions and protect Connecticut
Binding Arbitration and Collective Bargaining Laws.
The Red Ink flowing through the States
Budget needs more than a Band-aide. Removing Binding Arbitration and
Collective Bargaining will put the State on the Road to Recovery!
It is
the influence of the very powerful public sector unions which has brought our
state to record deficits. The failure of Governor Malloy and state
Democrats to curb that influence will drive our state and its taxpayers further
into debt.
The
following provides insight into the negative impact of arbitration on
taxpayers. Although written in 2011, it is very relevant today
Arbitration's
intolerable bind - The Boston Globe - Boston.com
Therein, Jeff Jacoby notes the following - Perhaps
the worst effect of binding arbitration is the way it erodes self-government.
It takes away from citizens and their elected officials the power to shape
local budgets and to establish wages and working conditions for public
employees. Those essential civic decisions are made instead by an outside
arbitrator who likely has no ties to the community and who will not have to
live with the consequences or be taxed to pay the costs of the settlement he
imposes. Continue reading at ….http://www.boston.com/bostonglobe/editorial_opinion/oped/articles/2011/01/12/arbitrations_intolerable_bind/?p1=Well_MostPop_Emailed3
But
realistically, can we anticipate any reforms to Binding Arbitration or
Collective Bargaining an issue raised by the Federation within the following
headlined article in 2012 when Governor Malloy described himself as the Son of
Organized Labor
Too
Cozy a Relationship Between the Governor, the State ...Legislature and the State Employee
Unions? You Decide!
************
So What Happens When Elected Officials Put
the Interests of Taxpayers Above that of the Unions?
When Unions Lose, Public Officials - who rely on the unions financial and moral support during a campaign – Also
Lose as highlighted within the following New York Times article by Monica Davey
on Feb 27, 2016 captioned
With
Fewer Members, a Diminished Political Role for ...Wisconsin Unions
The drop is most pronounced in the public sector: More than
half of Wisconsin public workers were in
unions before Mr. Walkers cuts took effect. A little
more than a quarter of them remain. The shift has shaken the order of election-year
politics. Democrats, who most often have been the
beneficiaries of money and ground-level help from the unions, said they were
uncertain about what the coming elections would look like, and what forces
could take the place of depleted labor groups. (read article)
**************
Will
CT Taxpayers ever win as they are billed
for the
costs associated with lucrative state and
municipal public sector union wage and pension contracts?!?
Due to
Binding Arbitration and Collective Bargaining Laws, the odds are always in the
unions favor as taxpayers are locked out of any negotiations transpiring
between management and labor, a fact highlighted by Flo Stahl and as noted
within the article captioned The Federation of
Connecticut Taxpayer Organizations Recognizes FLO STAHL where you can read her two excellent editorials.
(pls accept our
apology for the symbols intertwined within the words on our website – we are
working to correct the problem).
In
addition when financial information is released to the public following an
agreement on a union contract between management and labor you seldom get the
full story. For example you frequently hear or read of the NEGOTIATED WAGE increase in a union contract.
What you never hear being discussed nor reported by the press is the amount of
the STEP INCREASE increase which when coupled with
the negotiated wage increase can be a significant cost driver to taxpayers.
In
summary, your elected officials like to keep what transpires between them and
the unions secret, behind closed doors, because they too win in the end
through a system of what some call quid-pro-quo politics which can be defined
as You Give to Me, I Give to
You.
Campaign
donations keep your elected officials in office. And the unions know how
to give. The elected officials show their gratitude by bestowing money in
turn to the unions in healthy wage and pension benefits through LEGALLY binding
union contracts, which again it is important to note, are negotiated in secret
behind closed doors, out of the public eye. And contracts can in addition
to wage or benefit increases also reflect a change in management rights which
can benefit the union and also carry an increased cost to the taxpayer.
The
bills for these costs are then passed on to you, the taxpayer, through state
taxes and local property taxes. If you cannot afford to pay the bill then
one of your most prized possessions, Your Home or Business, could be on the
chopping block through a TAX LIEN SALE.
In summary, your Town can raise your
property taxes beyond your ability to pay, then set in
motion a mechanism in which you will lose your home or business through a Tax
Lien Sale!
We have
169 towns in Connecticut.
The majority of these towns rely on State aid to offset their local property
taxes. And now Municipalities fear big CT deficits will nix promised
state aid. If state aid is
cut, property tax bills could escalate for many!
How Does the Mill Rate in Your Town
Compare to Other Towns?
Check it out at OPM: Mill Rates - CT.gov
Elected
municipal officials are also players in this game which benefits the unions at
the expense of taxpayers. To make it worse sitting on many local
legislative boards to include Town Councils, Boards of Alderman, etc are state
and/or federal employees. They are either members of or friends of the
brotherhood and sisterhood of public sector employee unions. And their
votes speak volumes as they approve union contracts on a local level.
And these municipal union contracts – over
the years – have resulted in becoming the highest cost driver of local budgets.
On average, local salaries, pensions,
healthcare, and insurance benefits account for 70% to 85% of Town and Board of
Education budgets in Connecticut!
Many state and local government employees are earning high
salaries with overtime factored in. This overtime is then factored into
their pensions. While many private employers do not provide healthcare
for their retirees, State and local taxpayers carry this burden as well for the
public sector unions who have lucrative healthcare benefits.
In Connecticut, some safety personnel to
include police and fire benefit from the Drop Program!
Here is how it works. Upon reaching 25 years of service
and becoming eligible for retirement, employees can participate in the DROP
Program up to and through their 30th year of service.
In essence they collect two paychecks during that five year
period. First, their normal pay while working. Second, while working, 96% of the
employees pension is dropped into a saving plan which
the employee can manage. If they benefit from a rise in the stock market,
the payout could be greater. If
the market retreats, their payout could be less.
The following chart illustrates the benefits of the Drop
Program to employees. The Original Monthly Pension
Amount multiplied by 96% results in the DROP amount.
The last two columns reflect what has been accumulated for
one year with the last column reflecting the maximum five year period at which
time the employee would formally retire and leave the job. The five year
amount could ultimately be affected by how the employee manages his money
whether it be fixed income or investments etc.
Branch
|
Must retire by
|
Original monthly pension amount
|
Original DROP amount by Month
|
Original DROP amount for Year
|
Original DROP amount for Five Years
|
Police
|
11/28/15
|
$6,785
|
$6,514
|
$78,167
|
$390,834
|
Police
|
06/23/16
|
$6,736
|
$6,466
|
$77,593
|
$387,966
|
Police
|
07/16/14
|
$6,054
|
$5,812
|
$69,748
|
$348,739
|
Fire
|
02/10/13
|
$5,588
|
$5,365
|
$64,378
|
$321,890
|
Police
|
10/12/12
|
$5,574
|
$5,351
|
$64,211
|
$321,055
|
Police
|
03/12/14
|
$5,535
|
$5,313
|
$63,758
|
$318,788
|
This
program exists in East Hartford and is more
fully explained within Fire Pension - East Hartford, if you Search the word DROP.
Check to see if they have the DROP Program
in your Town.
**************
STATE DEBT
$71 BILLION DOLLARS
As noted within the
State’s latest
[PDF]Fiscal
Accountability Report - Connecticut General Assembly
The majority of the state’s debt is due to
lucrative pension and healthcare benefits promised by legally binding contracts
to public employees as noted below in red….
And Taxpayers Are Forced to Pay the
Bill!!!!
STATE OF CT LONG TERM DEBT OBLIGATIONS IN
BILLIONS
|
|
|
|
|
Unfunded Liabilities
|
Nov. 2014
|
Nov. 2015
|
Difference
|
Debt Outstanding
|
$21.3
|
$22.8
|
$1.5
|
State Employee Retirement
System (SERS)
|
13.3
|
14.9
|
1.6
|
Teachers Retirement System
|
10.8
|
10.8
|
0
|
State Post Employment Health
and Life
|
19.5
|
19.5
|
0
|
Teachers Post Employment Health
|
2.4
|
2.4
|
0
|
Generally Accepted Accounting
Principles Deficit
|
1.1
|
0.7
|
-0.4
|
TOTAL
|
$68.4 BILLION
|
$71.1 BILLION
|
$2.7 BILLION
|
In
2014, state pension payments totaling over $1.62 billion were made to 49,616 individuals.
Many
state employee pensions exceed $100,000; $200,000 and cap
out at $335,573.
In
Fiscal Year 2015, the state made 78,227 payments totaling $6.3 Billion
Dollars in salaries and benefits.
Last
week we learned that State Comptroller Kevin Lembo reports $220M deficit, confirms eroding tax receipts.
**************
How Can I find Out How Much the State is Spending on Salaries, Pensions, etc?
Due to
the efforts of both State Democrats and Republicans, Connecticut has an excellent Transparency
Website at Transparency Connecticut.
Also
State Comptroller Kevin Lembo continues to promote
Transparency as recently noted within Lembo Launches
Searchable Budget Transparency Website.
Check
out OpenConnecticut - Financial Information at Your Fingertips
And
more recently, COMPTROLLER LEMBO ANNOUNCES OVERWHELMING RESPONSE BY
QUASI-PUBLIC AGENCIES TO PROVIDE CHECKBOOK-LEVEL FINANCIAL DATA FOR STATE'S
ONLINE TRANPARENCY PORTAL
Budget | March 7, 2016 Comptroller Kevin Lembo announced today that 10 out of 12 Connecticut
quasi-public agencies have officially confirmed that they will voluntarily
provide his office with checkbook-level financial data annually to incorporate
in OpenConnecticut, the state’s comprehensive
financial transparency website.
-- read more
The
Federation recently asked Mr. Lembo for his
assistance in having the MDC and all 169 municipalities place similar
information on their websites. With 75% to 90% of local budgets funding
the salaries, benefits, and pensions of town/city employees, taxpayers deserve
to know what they are paying for.
Following
my request, I promptly received the following in response - Susan Thank you for
your recent email to Comptroller Lembo about
additional transparency opportunities. As you know we will be publishing
data on the state’s quasi-public agencies soon. MDC and the TRB Teachers
Retirement are two good future targets. We will be working on adding
real-time pension payments to the site this summer and it might make sense to
reach out to TRB at that time. We are also interested in expanding
municipal level transparency an effort MDC might fit into nicely. Thank
you for the suggestions we will continue to look for additional opportunities
to expand the website. Signed Office of the State Comptroller
We
recognize State Comptroller Kevin Lembo for his
exemplary efforts in promoting the Transparency of how our tax dollars are
spent!
**************
State Retiree Pension Payments
To see
what each state retiree is paid, after you have clicked on Pensions, click the Search button. You
will then see Retiree names listed alphabetically. Next, go to the last column and click Total twice. This will provide you with the highest to lowest paid state
retiree. The
following are the Top 10 Annual Pension Payments:
Name
|
Total $
|
VASNUS, ESTATE OF
|
335,573.71
|
VEIGA, JOHN F
|
290,355.24
|
BLECHNER, JACK N
|
286,691.88
|
PAVLAK, ESTATE OF
|
278,167.91
|
DEROSA, VINCENT J
|
254,096.04
|
BLANCHETTE, EDWARD A
|
238,132.86
|
ROGAL, KURT R
|
236,339.34
|
HARTLEY, HARRY J
|
222,367.26
|
JUDD, RICHARD L
|
218,882.28
|
SIGMAN, EUGENE
|
216,797.28
|
And also check the attached list of pensions paid to teachers
and administrators as provided to the Federation by the State.
**************
What about the State Budget and Deficits?
It
appears that with each day, comes a new revelation regarding shortfalls within
Governor Malloys budget. Such was the case on Feb 16, 2016 when State
Treasurer Denise
Nappier: Malloy's budget doesn't cover state's credit card bill ...
noting that
Gov. Dannel P. Malloys new
budget proposal could be $50 million to $74 million out of balance if state
Treasurer Denise L. Nappier and the State legislature
nonpartisan analysts are correct about what Connecticut owes on its credit card.
Continue reading at "Clean
Read"
As noted within the State of Connecticut latest
[PDF]Fiscal
Accountability Report - Connecticut General Assembly
STATE DEFICITS ARE
$6.6 BILLION DOLLARS
Budget Outlook in Millions
|
Connecticut Budget Deficits for Fiscal Years 2016
through Fiscal Year 2020
|
|
FY 2016
|
FY 2017
|
FY 2018
|
FY 2019
|
FY 2020
|
Estimated Expenditures
|
$18,199.3
|
$18,863.8
|
$20,253.7
|
$20,939.5
|
$21,840.2
|
Estimated Revenue
|
17,944.9
|
18,311.8
|
18,530.9
|
19,066.6
|
19,628.7
|
Surplus/(Deficit)
|
($254.4)
|
($552.0)
|
($1,722.8)
|
($1,872.9)
|
($2,211.5)
|
When the State Budget was initially proposed by Governor
Malloy, an article in FORBES by Rex Sinquefield put the State budget in perspective in June, 2015
Fiscal
Suicide: Connecticut Governor Malloy's $40 ... Billion Budget- Forbes
The
state legislature in Hartford
is at it again. Despite Connecticut
being an object lesson in how not to tax, Governor Dannel
P. Malloy and top Democratic leaders introduced
a two-year $40 billion budget that further cements the states growth averse
reputation. Voting mostly along party lines, the Connecticut Senate approved the budget 19-17 . With that approval comes tax
hikes on corporations, successful small business owners, and middle-class
families.
Last
week we learned that State Comptroller Kevin Lembo reports $220M deficit, confirms eroding tax receipts
In
January, 2016, we read Moody's: GE's departure
'underscores' Connecticut's fiscal ... economic woes noting the following - The news is a credit negative for the
state of Connecticut and it underscores the challenges the state faces as its
revenues and economy continue to underperform, Moody’s wrote in its weekly
credit outlook.
On
March 3, 2016, CTMirror.org wrote Malloy suspends $140 million in payments to CT hospitals Noting that Responding to
shrinking tax revenues, Gov. Dannel P. Malloys administration suspended about $140 million in
payments to Connecticuts acute-care hospitals this
week. The decision drew angry responses from the Connecticut Hospital
Association and the legislatures Republican minority. and Legislature considers furloughs; judiciary cancels raises noting Underscoring the fiscal crisis facing Connecticut,
the General Assembly is considering furloughs of legislative staff, a rollback
of staff raises, and a rare rejection of a negotiated contract. Meanwhile, the
Judicial Branch has canceled raises for non-union employees that were to take
effect Friday.
On
March 2, 2016, CTMirror.org wrote Malloy urges rejecting UConn
labor pact noting After
nudging legislators to reject a labor deal granting raises at the University of
Connecticut, Gov. Dannel P. Malloy gave them a hard
push Wednesday, publicly urging rejection of a contract the
university negotiated with its Professional Employees Union. Senate
leaders quickly indicated they will comply.
On Oct
5, 2015, the Wall St Journal reported Connecticut, America's Richest
State, Has a Huge Pension ...Problem noting the following - Connecticut has roughly half of what
it needs to pay future retirement benefits for its workers, meaning the home to
scores of hedge funds and some of the countrys
wealthiest towns is wrestling with financial distress rivaling that of Kentucky
or Illinois.
But unions should be careful when they ask
for more because some are asking the question
PENSION PULSE: Are U.S. Public Pensions Doomed? (blog - Leo Kolivakis)
**************
There is a wide disparty
between the Connecticut
private sector employees working at-will versus protected state and local
government sector union employees.
The
$100 million lawsuit initiated by Connecticut
State employee unions helps to
illustrate the wide disparty between the Connecticut
private sector employee working at-will versus protected state and local
government sector union employees.
The
at-will private sector employee can be terminated at any time, for any legal
reason, or for no reason at all by their employer. They are an
unprotected class. They work in a state of flux knowing that their
employer on any given day can demand that they pay a greater share of their
health care premium, take on a greater workload, receive a minimal salary
increase, no salary increase or have their pay cut. There will be
no debate, no bargaining, no arbitration, and no elected official waiting to
defend them.
Yet, the majority of Connecticut taxpayers work at-will while
they are forced to pay many exorbitant public employee union salaries and
pensions locked in by union contracts!
It is obvious that the band-aid approach to
solving our State budget problems over the years has failed as the state sinks
deeper into debt.
Now is the time for true reform. Time
to eliminate the control the public sector unions have over taxpayer
funds. And there is only one solution
Eliminate Binding Arbitration and Collective
Bargaining Laws!
**************