Editor’s note: This story responds to a reader question through the Record-Journal’s Voices initiative, an ongoing effort to cover the news that matters most to you.
WALLINGFORD — Pension liabilities have burdened the state budget for years, and decades of underfunding have at least one voter worried about the potential local impact.
“It’s taking up so much political oxygen,” Wallingford resident Casey Camire said. "Until Connecticut has squared that circle, we’re going to have a hard time reforming other aspects of state government.”
Camire, a 28-year-old chemical engineer at Henkel Consumer Goods and first time father-to-be, grew up in Meriden. He thinks Connecticut is a great state to live in, but is concerned about the state pension obligation — the biggest challenge the state is facing, he says — and the impact on Wallingford.
State Treasurer Shawn Wooden announced Thursday the state will contribute an additional $60 million to the the State Employees Retirement Fund. Retired teachers are paid from the Teachers’ Retirement System Fund.
But the unfunded pension liability is in the tens of billions of dollars, and Gov. Ned Lamont also has to contend with a $2.1 billion budget deficit projected in the next fiscal year.
Economic development in the state is “absolutely a consequence of pension obligations,” Camire said, and Wallingford has been somewhat “insulated” from the pension crisis, which “has lead to a bit of stagnation in the town.”
“Other towns are becoming more innovative in attracting businesses than Wallingford,” he said, “and I think it’s because Wallingford has lulled itself into a sense of security over not having the same pension issues that towns, like Meriden, have had.”
Camire said Wallingford Democratic mayoral candidate Jared Liu’s campaign piqued his interest, after he studied Liu’s platform on Wallingford’s fiscal situation, his views on downtown economic development and how having things like strong public utilities layers in.
“I have a sense that one of our economic advantages … is that we have cheap electricity and reliable electricity,” he said. “Do we have plans to begin generating our own power again? Do we have plans to offer clean energy solutions like incentivize solar panels and incorporating that into our own grid? How can we continue to leverage a strong public utility to attract and keep businesses?”
All of this, Camire said, is important because running deficits and raiding the rainy day fund to cover the pensions could lead to the state government defaulting on its debts, which would lead to deep cuts to education and other services, the inability to invest in infrastructure and give businesses a reason to skip Connecticut.
Camire is seeking a response from the candidates about what he feels is a deep structural issue in the state government, hoping they “demonstrate they understand beyond headline issues the problems actually facing Connecticut … that they actually understand the government they would want to work within … and they're not bickering about the state income tax didn’t get repealed or arguing about mask mandates."
Candidates respond
The Record-Journal shared Camire’s concerns with six candidates running for seats in the state legislature, who were asked to answer the following question:
“What policies would you support to address the state pension crisis, while preserving Wallingford’s economic development efforts and stability at the Wallingford Electric Division?”
85th House
Mushinsky, Ulbrich
Democratic incumbent Mary Mushinsky
“We have partly addressed the state’s failure to save for pensions since the 1930s. We passed legislation to remove the balloon payments, stretched out the payment timetable, adopted a more realistic assumed return rate for investments and made payments toward the unfunded pension liability, including a $61 million payment on Oct. 1. If the town chooses, Wallingford can use economic development tools that are already available and that have been used successfully by other municipalities. These include: commuter rail, transit-oriented development to link businesses and residents, and increased housing built around the rail hub and downtown. Support for Wallingford’s STEM training program also supports economic development. According to Rick Hendershot, director of Wallingford Public Utilities, there are no changes envisioned at the Wallingford Electric Division. We regulated investor-owned utilities at the legislature on Sept. 30 after their poor storm performance, but municipal utilities performed well and they are exempt.”
Republican challenger Wes Ulbrich
“To plan for the long-term fiscal health of our state, I would support policies that embrace technology to improve efficiencies. This will gradually lessen the burden of our pension crisis. We also need to renew collective bargaining conversations with SEBAC, who represent about 46,000 state employees. A full transition to modern 401k plans must be on the table. I see Wallingford’s economic development as poised to flourish in the next decade. If we contain the pension crisis by making strides in efficiency and bargaining, then state grants for in-town projects may attract greater economic development. Tim Ryan, Wallingford's economic development specialist does more for our town than most economic development professionals in the State of Connecticut and with less funding per capita. As the pension crisis relates to the stability of Wallingford Electric Division, our town wants local control of services. I would support any state proposals that keep Wallingford utilities in the hands of our townspeople. Any trickle-down effects from pension reform such as regionalization of services must be considered carefully.”
90th House
Jinks, Fishbein
Republican incumbent Craig Fishbein
“Actually, the question is a bit confusing. At the outset, the ‘state pension crisis’ is not connected to the Wallingford Electric Division, nor is it really connected to Wallingford economic development except to the extent that if the state had met their pension liabilities over the last three decades, perhaps there would be more money for towns for local economic development. Ultimately though, the pensions that the state agreed to provide its workers through the collective bargaining process should be honored. The pensions were part of the deal ‘…if you come to work for the state, we will give you a pension for your service.’ For the state to now renege on that agreement would be unfair to those that have given their service in reliance upon the agreement. The state pension crisis should be addressed by reducing the spending on political pet projects, and paying on the pension liability, which I believe just yesterday approximately $30 million from reserves was paid toward that liability.”
Democratic challenger Jim Jinks
“Addressing our stagnant state economy is a major focus of mine. We need to keep our young workers and families and we need to make our state more affordable for everyone. In Wallingford, in particular, we have a great opportunity to revive our downtown area near the new train station. It's ripe for a new vision and redevelopment. Meriden has tapped about $30 million in state and federal grants to invest around their new train station. Why not Wallingford? We have to stop sitting on our hands and make good things happen. For decades the state didn't pay into the state pension fund and this is why we have a ‘crisis’ now. It is a big challenge. But growing our economy is a big part of the answer. Regarding the electric division I'm very supportive of local energy initiatives. Our lower energy costs in Wallingford are a competitive advantage. Let’s not fix what isn’t broken.’’
34th Senate
Cicarella, Capone
Democrat April Capone
“Our state’s unfunded pension crisis is the result of irresponsible planning and budgeting by scores of previous Connecticut administrations. Now, current Connecticut legislators, and the pension-holders that are owed, are left to pick up the pieces. Primarily, the state must maintain its promise to the middle- and working-class pension holders who served in our public workforce and created the quality of work we enjoy in Connecticut today. The state must also address those pensions which are irresponsibly high – some in the quarter-million dollars a year range – and many of which are in excess of legal federal IRS and contractual limits. The Town of Wallingford Electric Division displays time and time again its ability to serve its local customers faithfully and maintain their access to utilities, restoring power to almost all of its ratepayers in fewer than 48 hours in the aftermath of storm Isaias. The General Assembly absolutely must create a funding plan which ensures these trial-tested divisions can continue to not only serve ratepayers faithfully, but provide the quality of life in retirement which their employees deserve.”
Republican Paul Cicarella
“Connecticut needs to examine long term structural changes to better address the state's financial issues. Our state should look toward what has been successful in the 34th District to boost economic development, be fiscally smart and prudent, and create stability on the local level that we don't see on the state level. Wallingford for example has been a leader in pursuing innovative policies when it comes to energy and education. The town's workforce pipeline program is an especially effective initiative developed under the guidance of (Wallingford Public Schools) Superintendent (Salvatore) Menzo, that works with public schools and local businesses to develop curriculum to prepare young people for specific opportunities in the local workforce. This program is now a model for statewide efforts. Policies that grow jobs and help people develop the skills they need to fill good-paying positions is key to improving our economy and restoring financial health in our state.”
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