HARTFORD, CT — With a no-layoff provision and a contract for health and pension benefits that extends to 2027, Gov. Ned Lamont has nothing he can offer his friends in labor, yet he asked them Wednesday to make changes to their future pension benefits.
“Some of the old pros here, they’ve suggested that I hold off on these discussions for a few years when I have more leverage — the threat of layoffs to propel the negotiation. Forget it,” Lamont said. “We can’t afford to wait two years and threatening to layoff our newest state employees who are doing important work. That’s not the way I negotiate and that’s not the way I treat people.”
He said he wants to have a “Connecticut moment” where the state shows the nation that collective bargaining works.
What Lamont is asking of labor is a change in future retirees cost-of-living adjustment. Instead of the annual increase they get now, they would get an increase based on the performance of the fund investments. If those investments don’t meet expectations, then the annual cost-of-living adjustment would be limited to one percent, and in years when returns meet expectations the increase would be three percent and it could go as high as five percent.
The change, which will require a vote of the rank-and-file union members, would only save Connecticut about $20 million a year, according to Office of Policy and Management Secretary Melissa McCaw.
In addition, Lamont wants to eliminate mileage reimbursement from legislators pension calculations, and he would change the amortization schedule for some of the outstanding unfunded liability from 2032 to 2046.
Collectively, the changes will reduce the budget by about $131.9 million in 2020 and $141.8 million in 2021.
House Speaker Joe Aresimowicz, D-Berlin, who works for AFSCME Council 4, said he’s in favor of collective bargaining and declined to speculate on the outcome of any negotiations between the State Employees Bargaining Agent Coalition and the Lamont administration.
“I wish him the best of luck,” Aresimowicz said.
Asked if he supports the proposed changes, Aresimowicz said he supports collective bargaining.
Labor was publicly convinced that Lamont, who they supported, would not ask them to re-open the 2017 contract even though Lamont never explicitly said that on the campaign trail.
“We are disappointed that Gov. Lamont has broken his campaign promise to not seek further givebacks from state workers after they made concessions three times over the last decade,” AFL-CIO President Sal Luciano, said. “Our teachers, firefighters, nurses, corrections officers, and other state workers have already made concessions worth tens of billions of dollars, and to continue to go after these public service workers is patently unfair.”
Luciano added that the budget proposal doesn’t ask the wealthy to help solve the deficit.
“Eliminating the gift tax, reducing the estate tax, and not asking the rich to pay any additional income taxes means the wealthiest 1 percent reap significant savings while working people pay more in taxes,” Luciano said.
Rob Baril, president of SEIU Local 1199NE, said Lamont didn’t win the election based on the agenda he put forward Wednesday.
“The austerity agenda was rejected in the election and Governor Lamont was put in office thanks to the votes of working-class families,” Baril said. “We see that working people are being asked to make sacrifices once again. But what we don’t see is a willingness to ask the greedy few to pay their fair share.”
Lamont’s budget does not increase income taxes, it eliminates the gift tax and it continues to phase-in the federal exemption level of the estate tax.
Senate Republican Leader Len Fasano, R-North Haven, said if Lamont was actually concerned about expenditures and pensions why didn’t he call for the two labor contracts approved by the House and the Senate Wednesday to be rejected?
The contracts included a 3.5 percent cost of living increase, in compliance with the 2017 SEBAC agreement.
“If he believes in what he’s saying he’s got to be consistent,” Fasano said.