CONNECTICUT’S SHIP OF STATE IS SINKING!!!
A Tsunami of debt has engulfed our State
bringing with it a sea of red ink
as disclosed within the November, 2015
[PDF] Fiscal Accountability Report - Connecticut General Assembly.
This report is required by law,
Specifically Connecticut General Statutes Sec.
2-36b.
STATE DEFICITS
$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)
|
********
STATE DEBT
$71.1 BILLION DOLLARS
|
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
|
We are also learning
from CTMirror.org that …
Auditors again find costly problems with state pension
program
********
We
suggest it is not surprising that the majority of the State’s long term debt is
attributed to promises made by former and current state elected officials to
state public employees and retirees. The
majority of these costs – wages, benefits, pensions – have been solidified
through legally binding union contracts.
The quid-pro-quo relationship between state elected officials and the
state employee unions - although beneficial to them - has had a detrimental
impact on taxpayers. As the unions are
rewarded with lucrative contracts by state elected officials who in turn
receive union support in the voting booth, the taxpayer is ultimately presented
with the bill.
These outstanding bills are now in the billions and
Connecticut Taxpayers will be forced to pay them!
November 27, 2015
From: The Federation of Connecticut Taxpayer
Organizations
Contact: Susan Kniep,
President
Website: http://ctact.org/
Email: fctopresident@aol.com
Telephone:
860-841-8032
As it pertains to the State’s long term debt
obligations which grew from $68.4 Billion in November 2014 to $71.1 Billion as
of Nov 2015 – an increase of $2.7 Billion - Republican Senate Minority Leader
Len Fasano said it best
“Connecticut is borrowing
excessively for operating expenses, swiping the state credit card for daily
necessities”.
********
We review below State employee wages, benefits, pensions and
healthcare costs which are driving the State’s billions of dollars of debt and
deficits and which are solidified by legally binding union contracts. The following resource will also provide you
with the tools to review the salaries, benefits and pensions of each State
employee and retiree.
But there is another concern. A concern beyond what we owe to State
employees and retirees. The concern is
for a State plan for private sector workers which is addressed within the
November, 2015 Wall Street Journal article captioned
The Irresponsibility of States Guaranteeing Pension Returns
...
The article is written by Olivia S. Mitchell (@OS_Mitchell) a
professor of business economics and public policy at the Wharton
School of the University of Pennsylvania. She
is also executive director of the Pension
Research Council and director of the Boettner
Center on Pensions & Retirement Research.
In her article which
recently appeared in the Wall St Journal she references Connecticut as she
states the following……Some 25 states and several U.S. cities are working to
establish new
retirement accounts to help American workers lacking a
pension plan save for retirement. Three states have
already passed legislation setting up state-driven individual retirement
accounts via payroll deduction, and many more states have indicated they plan
to follow suit soon. In some cases, the money will be managed by the state, as
in Illinois, Massachusetts
and New Jersey.
In others, private-sector money managers would do the investing.
One major concern deserving of far more debate is that
at least five of the state bills stipulate that the funds’ investment returns
would be guaranteed, to protect workers’ money. For instance, Connecticut
is moving toward a so-called Guaranteed Retirement Account, providing for
a “fixed 3% rate of
return adjusted for inflation” backed by the state. Continue reading her
excellent article at …..
http://blogs.wsj.com/experts/2015/11/05/the-irresponsibility-of-states-guaranteeing-pension-returns/
********
STATE EMPLOYEE PENSIONS
In Calendar Year 2014, the
State issued 49,616 checks for State Pensions totaling in
excess of $1.62 BILLION DOLLARS.
Taxpayers also owe $14.9
Billion to the State Employee Retirement System and another $10.8
Billion to the Teachers’ Retirement System. The highest pension we pay is now in excess
of $300,000 per year with many in excess of $100,000 and $200,000 per year.
The Top Ten State Pensions
Paid in Calendar Year 2014 were $335,573; $290,355; $286,691; $278,167;
$254,096; $238,132; $236339; $222,367; $218,882; $216,797!
To View
a complete list of Pensions Paid
Click on Pensions - Transparency Connecticut -
CT.gov .
Next,
click SEARCH. Then click
column heading TOTAL two times. You will see the highest to the
lowest pensions being paid per retiree. Click the arrow at the top of
the column to continue your search.
********
STATE EMPLOYEE HEALTHCARE
The majority of private sector workers do not
and will not have their healthcare costs paid by their employer when they
retire.
State Retirees and Teachers, however, do have
taxpayer funded healthcare benefits for which taxpayers owe
$19.5 Billion for Retired State Employees and $2.4 for Retired
Teachers
************
STATE EMPLOYEE WAGES
In Fiscal Year 2015 (July 1,
2014 to June 30, 2015), 78,277 checks totaling $6.3 Billion were issued.
The Top Ten State Wages and
Benefits Paid in Fiscal Year 2015 were $2,968,505; $2,341,494; $1,656,328; $1,282,868; $1,236,696; $1,233,737;
$1,057,566; $1,009,208; $768,557; $721,816.
To View a complete list
Click on Employee Compensation
Upon arrival to this
website you will find that you can check state employee compensation for each
Fiscal Year from 2010 to 2015. To
check the Compensation paid to each employee from the highest to the lowest
paid, do the following.
After you have clicked
on Employee Compensation, Click on Advanced Search, Then click on Search, you will then see 5 columns. Go to the last column captioned TOTAL and click on two times. This will give you the highest to the
lowest paid. To move from
page to page Go to the heading over the columns which is labeled
Search Results. At the end
you will see an arrow which you can click each time you want to move on to the
next page. You will also see a reference
among the top three to Student worker.
We are checking in to that.
************
On October 8, 2015 the Yankee Institute
released their findings
Unequal Pay: Public vs. Private Sector Compensation in ...Connecticut.
The following are excerpts:
Public employees receive total compensation packages that are 25 to 46
percent higher than private employees with comparable skills and
experience. Although the salaries of public employees are comparable to
those of private sector employees, the health care and pension benefits
received by public employees are far costlier than those provided
to private employees.
If Connecticut
public employees were compensated at similar rates to private employees, the
state would save between $1.4 billion and $2.5 billion a year. This
lopsided compensation has consequences. Despite hefty tax increases,
lawmaker have still had to cut discretionary spending – and prospective
deficits jeopardize funding for items including roads, schools and social
services for the poor. In addition, because lawmakers and union leaders
have agreed for years to underfund the expensive pensions offered to state
employees, Connecticut
now has a staggering pension debt. The state’s attempts to pay down that
debt have so far been fruitless.
Continue reading at… http://www.yankeeinstitute.org/policy-papers/unequal-pay/
************
Continue to explore the
expenditure of your state tax dollars at
Transparency Connecticut
***********
If the State’s growing Debts and Deficits
aren’t enough to make you cringe, we have also learned that George Jepsen, Connecticut’s
AG declares constitutional spending cap unenforceable ....
Specifically,
State Attorney General Jepsen issued this finding more than 20 years after voters
supported the Cap and it went into effect.
CTMirror.org writes: “Connecticut’s constitutional spending cap, often a major weapon
in political and policy fights, carries no legal authority because of the
legislature’s failure to formally implement the measure according to Jepsen”.
Jepsen’s current finding is contrary to that issued in 1993 by then
Attorney General Richard Blumenthal who “concluded that legislators, by
taking no action on the definitions, effectively had designated the statutory
system as a constitutional cap by default.”
Richard Blumenthal currently serves as a US Senator elected in 2011. In May we learned of the 10 Richest Politicians in the United States - The Cheat Sheet. Therein, Blumenthal was listed among the top 10 noting
“Richard Blumenthal holds wealth estimated at just under $104 million”.
Let’s
remember the significance of the Spending Cap which was overwhelmingly
supported by 80% of Connecticut
voters in 1992. The purpose of the cap was to limit state spending following
the 1991 adoption by the State Legislature of the State Income Tax.
It appears
we now have two opinions on the same subject from the same State office. The first
opinion is one under which the State legislature has worked for more than 20
years.
In April, 2015 the Yankee Institute also weighed in as noted
within Connecticut's Spending Cap: A Legal Overview - Yankee ...Institute.
Certainly, the current opinion by AG Jepsen, with legislative spending
constraints removed, came at a convenient time of year for Governor Malloy and
Democrats in the State legislature who hold the majority votes over what has
been revealed to date to be a flawed state
budget burdened with debt.
A gift one might say for which one could assume thanks was offered at
the Thanksgiving tables of some state legislators yesterday as they satisfy
their insatiable appetites for more taxpayer dollars to close the State’s budget
deficit.
And it appears we have another state official jumping on board to quell
the backlash being directed at those who created the most recent state budget
fiasco.
Although Ben
Barnes, appointed by Malloy in 2011 to serve as the Secretary of the State of
Connecticut Office of Policy and Management, got it right in 2014 when he said “the
state is in a period of permanent fiscal crisis”, he now wants to take it
back. And he wants us to accept his
apology – to forgive him - because he didn’t mean it. Barnes now says “I don’t believe that the
state is in any kind of a crisis”!!!!
If the politicos
on the Hill in Hartford
are looking to take ratings away from Saturday Night Live they have
succeeded. But we fear the joke will be
on the taxpayers of our State, some of whom are looking for a way out, and
finding it!
The Yankee Institute addressed the exodus from Connecticut by hard
working taxpayers wanting to keep some of their money. In their report captioned That's $60 a second, the Yankee Institute noted that “Over the past two years
38 residents left Connecticut each day, taking with them $5.2 million of
income.!
In October, the Hartford
Courant posted the following headline Thousands Of Connecticut Residents Moving To Other ...
States, Fewer Moving In, and
This week the Hartford Courant reported Millennials, And Boomers, Moving From Connecticut In Growing Numbers
On Nov 14, 2015, Alan and Gerald Zordan noted
the following
in a Journal Inquirer headlined article
captioned
Goodbye, Connecticut: It's just too expensive here - Journal
...
With the Litchfield hills and Connecticut
in our rear-view mirror as we move our 101-year-old manufacturing company to South Carolina, we are
nostalgic, excited, and disappointed. We
love Torrington and Connecticut but not all the things the
General Assembly and the governor have done to induce us to leave family and
friends behind. After more than a century of manufacturing in Connecticut, we are not looking for
handouts. We have paid our fair share,
but enough is enough.
Connecticut’s high cost of
doing business and its anti-employer attitude have finally driven us out. Continue reading their excellent editorial at http://www.journalinquirer.com/opinion/other_commentary/goodbye-connecticut-it-s-just-too-expensive-here/article_7aa52808-8930-11e5-9aa1-8b1a9ec391af.html
On June 22, 2015, Truth in Accounting (TIA), issued a Press Release
regarding the Financial State of Connecticut based on 2014 data. They classified Connecticut
as a SINKHOLE STATE
with the second highest per capita debt in the nation at $48,600, with New Jersey being the
highest at $52,300 per capita.
As such, the fiscal pulse of Connecticut requires immediate care. Whether we gorge ourselves with food or our
state legislators gorge themselves on personal and corporate state taxes,
weight gain can ultimately have a crippling effect on our health. And the State’s fiscal health weighed down by
heavy debt needs a qualified surgeon to immediately begin dissecting and
repairing State Employee Union Contracts to include wages, benefits, overtime, pensions and work related
issues before the State and its taxpayer go broke, as
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CTMirror.org
******************
In
September 2014 Don Michak of the Journal Inquirer wrote
State Treasurer Targets Teacher Fund
*****************
Kevin Rennie provides
insight into this year’s budget
Election Funding Overshadows Budget Jam