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State's unfunded pension liability hits 22-year high
By Keith M. Phaneuf CTmirror.org
From The Federation of Connecticut Taxpayer Organizations
Contact Susan Kniep
Website: http://ctact.org/
Email: fctopresident@aol.com
Telephone: 860-841-8032
Tax Talk December 10, 2010
CONNECTICUT’S DEBT: $72 BILLION DOLLAR!
TODAY THE STATE
BOND COMMISSION COULD
TAKE US
DEEPER INTO DEBT!!!
The Federation of CT Taxpayer Organizations
Has Asked the State Bond Commission to:
VOTE NO
ON THE MULTI-MILLION BOND PACKAGE!
IMPOSE A MORATORIUM ON BONDING!
CONTROL SPENDING! REFORM MANDATES!
*** Please Refer to our Letter Below ***
December 10, 2010 State Bond
Commission Agenda
http://www.ct.gov/opm/lib/opm/budget/capitalbudget/cy2010/2010dec10_sbc_agenda.pdf
Latest
Fiscal Accountability Report Released Last Month Reflects Connecticut’s Growing Deficits and More….
http://ctmirror.org/sites/default/files/documents/OFA_Nov%2015%202010%20report2.pdf
BREAKDOWN
OF CONNECTICUT’S
$72 BILLION DOLLAR DEBT
|
1) Debt Outstanding
|
19.3
|
2a) State Employee Pensions – Unfunded
|
11.8
|
2b) Teachers’ Pensions – Unfunded
|
9.1
|
3a) State Post Retirement Health and
Life – Unfunded
|
26.6
|
3b) Teachers’ Post Retirement Health
and Life
|
2.9
|
4) Generally Accepted Accounting
Principles Deficit
|
2.3
|
Total
|
$72 BILLION
|
Spent surpluses loom large
against state's budget deficit ctmirror.org kphaneuf@ctmirror.org Keith M. Phaneuf State
officials ordered as much surplus spending over the past 12 years as the entire
deficit looming over the next fiscal year, according to a new report from
nonpartisan legislative analysts. Past and present governors and legislators
spent $2.76 billion from surpluses as soon as they were available, and took
another $696 million left over from annual budgets and allocated it to future
budgets a year or two out. Those two allocations combined approach $3.5
billion, or 59 percent of the cumulative surpluses recorded since 1999,
according to the annual Fiscal Accountability Report delivered last week by the nonpartisan Office of Fiscal
Analysis to the legislature's Appropriations and Finance, Revenue & Bonding
committees. Legislative analysts project that the next fiscal year, which
begins July 1, faces a built-in shortfall of $3.67 billion, while the Executive
Branch's chief fiscal arm, the Office of Policy and Management, pegs it at $3.37 billion. The average,
$3.52 billion, represents 18.5 percent of current spending
http://ctmirror.org/story/8557/spent-surpluses-loom-large-against-states-budget-deficit
For the period FY 99-10,
there was $5.87 billion in surplus funds, of which:
$1.47 billion was deposited to the Budget Reserve Fund;
$41.3 million used for reduction of bonded indebtedness,
pursuant to the Connecticut
Constitution;
$2.76 billion was appropriated for both one-time
expenditures and on-going uses;
$96.2 million was used for a rebate to taxpayers;
$800 million was used for debt avoidance; and
$695.7 was used as one-time revenue to balance the budget in
subsequent fiscal years.
Washington's Next Big
Decision: Bailout the States or Not?
Wall Street Journal, Dec 8, 2010, Peter A. Brown, assistant director of the
Quinnipiac University Polling Institute - Amid all the talk in Washington,
D.C., about cutting the federal budget deficit, there is little public
discussion of what might be among the most contentious issues that will face
the new Congress in January – whether to bail out the states. Obviously, sending
money to the states to reduce their red ink would make it more difficult for
Congress to meet its goal of trying to get the federal deficit under control.
But the rough estimate is that the various states face budget shortfalls
exceeding $100 billion. Without a bailout from Washington, a large number of states will be
forced to endure unprecedented levels of spending reductions or tax increases.
Continued at …. http://blogs.wsj.com/capitaljournal/2010/12/08/washingtons-next-big-decision-bailout-the-states-or-not/
Cheat Sheet: Where the Fed's
Trillions Went by Marian Wang Dec 9, 2010
Following the failure of Lehman Brothers the biggest U.S.
banks had tabs with the Fed that ran in the tens of billions on any given day
during the worst parts of the financial crisis. Big banks typically got funds
through more than one program because they were eligible for different types of
loans. As our interactive shows, Citigroup, Merrill Lynch and Morgan Stanley
topped the list, with more than 200 loans each, though Bank of America
and Goldman Sachs weren’t far behind. (The Wall Street Journal has helpfully graphed this out [3].) Complete article at …. http://www.propublica.org/blog/item/cheat-sheet-where-the-feds-trillions-went
Mounting State Debts Stoke Fears of
a Looming Crisis, See Reference to Connecticut http://www.nytimes.com/2010/12/05/us/politics/05states.html?_r=1&scp=4&sq=michael%20cooper&st=cse
Wind at their backs: Powerful
Democrats help Chinese energy firm chase stimulus money Sen. Reid and Obama donors back
company seeking $450 million in U.S.
money http://www.msnbc.msn.com/id/40565987/ns/business-going_green/
Education panel rejects 'money follows the child'
CT Mirror, Dec 6, 2010
WikiLeaks cables on Afghanistan show
monumental corruption - CNN Hundreds
of US diplomatic cables obtained by WikiLeaks paint a
picture of corruption in Afghanistan
at every level of government and society. http://articles.cnn.com/2010-12-02/world/afghanistan.wikileaks_1_ambassador-karl-eikenberry-cables-afghan-president-hamid-karzai?_s=PM:WORLD
Malloy warns House Democrats of tough decisions ahead
CT Mirror, Dec 6, 2010
In Tax Deal, Many Public Employees Will Pay More The union spent $90 million to help elect Democrats during
the last election cycle, when Mr. Obama promoted a
plan to preserve tax cuts for all but the wealthiest 2 percent of Americans. http://www.cnbc.com//id/40586413
Senate Republicans Block U.S. Health Aid for 9/11 Workers
The bill provided medical care for rescue workers and
residents of New York City
who became ill as a result of breathing in toxic fumes from ground zero. http://ireport.cnn.com/docs/DOC-527294?ref=feeds%2Flatest
Tax Appeals Swamp US Cities, Towns as
Property Prices Plunge
Bloomberg Dec 8, 2010 The backlog of cases from
taxpayers seeking to lower property-tax bills of more than $100000 shot up to
14236 this year from an annual average of about 6000 ... http://www.bloomberg.com/news/2010-12-08/plunging-home-prices-fuel-property-tax-appeals-swamping-u-s-cities-towns.html
Corruption agency files charges against Cheney By Ifedayo Adebayo
December 8, 2010 The Economic and Financial Crime Commission
(EFCC) http://234next.com/csp/cms/sites/Next/News/Metro/Politics/5651299-146/corruption_agency_files_charges_against_cheney.csp
Is the Golden Age of Education Spending Over? Dec 9, 2010 Time Magazine,
by Andrew J. Rotherham According to a report issued jointly last
week by the National Governors Association and the National Association of
State Budget Officers, when federal stimulus funds run out in 2011, states —
and, by extension, schools — will tumble off a fiscal cliff, and even an economic
upturn won't bring state funding back up to where it was a few years ago. The
problem, however, is not just the struggling economy. In 1970 America spent
about $228 billion in today's dollars on public schools. In 2007 that figure
was $583 billion. True, some of the increase can be traced back to growing
enrollments, better programs, and improved services for special-education and
other students, but much of the increase is just a lot of spending without a
lot to show for it. And given all the various pressures on state budgets
(including our aging population, health care costs and the substantial
obligations states and school districts owe for pensions and benefits), the
golden age of school spending is likely coming to an end. (See what makes a school great.)
Read Complete article at http://www.time.com/time/nation/article/0,8599,2035999,00.html
Preliminary Summary -
NGA/NASBO Fall 2010 Fiscal Survey of States
As State Spending and Revenue
Remains Well Below Pre-Recession Levels, Some States Approach a Cliff in 2012 http://nasbo.org/LinkClick.aspx?fileticket=wJKroFj6QDA%3d&tabid=38
Click here for the
full report.
House passes Obama-backed doc fix Jason Millman -
12/09/10 01:20 PM ET
*********************
To: Members of the State Bond Commission
Governor.Rell@ct.gov, Brenda.Sisco@Ct.gov, state.treasurer@ct.gov, nancy.wyman@po.state.ct.us, attorney.general@ct.gov, Daily@senatedems.ct.gov,patrick.nolan@ct.gov, Cam9123@hotmail.com, Andrew.Roraback@cga.ct.gov, Vincent.Candelora@housegop.ct.gov
From: The Federation of Connecticut Taxpayer Organizations
(FCTO)
Contact: Susan Kniep,
President, Website: http://ctact.org/
Email: fctopresident@aol.com, Telephone: 860-841-8032
VOTE NO ON MULTI-MILLION
BOND PACKAGE!
IMPOSE MORATORIUM ON BONDING!
CONTROL SPENDING! REFORM MANDATES!
The State’s Latest Fiscal
Accountability Report Released in November Reflects Connecticut’s Growing Deficits at $72
Billion. http://ctmirror.org/sites/default/files/documents/OFA_Nov%2015%202010%20report2.pdf
In September, 2009, Bloomberg
News announced “Connecticut
Debt Balloons as State Readies Deficit Financing”. Bloomberg recognized Connecticut as being
“the state with the most tax-supported debt as it prepares to borrow $2.25
billion over the next two years to balance its budget”.
On August 17, 2010,
Reuters informed the nation that “Connecticut may have just a
week's worth of cash” as noted by State Treasurer Denise Nappier
in her August 13, 2010 letter to Connecticut’s Bond Commission in which she
requested the sale of $520 million General Obligation Bonds to meet the demands
of bills which had to be paid.
Connecticut’s debt per capita of $4859 exceeds that of California at
$2362.
In June, 2010,
Fitch Ratings announced that it had downgraded Connecticut's bonds citing the state's
tendency to borrow money to cover budget deficits rather than raise taxes or
reduce spending.
As such, we believe it is imperative that no additional bonding be approved and a moratorium on bonding be imposed
for at least one year or more.
Concurrently, spending must be brought under control through reforms to state mandates to include Binding Arbitration.
Unlike
the private sector, the majority of public sector union contracts in our State
allow overtime to be factored into pension benefits. Taxpayers also pay
for the healthcare of many state retirees.
As of January 1, 2010:
7,289 Connecticut
Retirees are Receiving Pensions Between $50,000 and
$259,000.
4,989 Connecticut
Teachers and Administrators are Receiving Pensions
Between $50,000 and $183,000
As many Connecticut
state employees collect lucrative pensions with health benefits, others are
also reaping financial rewards. Total compensation paid to state pension
investment advisors for 2009 was nearly $89 million compared to $77 million in
the previous year.
A recent study by Northwestern
University predicts that Connecticut’s state
employee pension fund will be broke by 2019 .
It is apparent that our State cannot continue on this path
to self destruction at the taxpayers’ expense. Connecticut must get
its financial house in order and that cannot be done by driving our State and
its taxpayers further into debt which will have to be passed on to our
children.
Again, please VOTE NO on all bonding requests,
impose a moratorium on bonding, reign in spending and reform state mandates to
include Binding Arbitration.