The fate of Gov. Dannel P. Malloy’s plan to restructure the state employee pension system — which would shift billions of dollars in costs onto future taxpayers — mustn’t be resolved without votes by the House and Senate, according to the top Republicans in both chambers.
But whether Sen. Len Fasano, R-North Haven, and Rep. Themis Klarides, R-Derby, get their way may hinge on sensitive negotiations between Fasano and the top Democrat in the Senate, President Pro Tem Martin M. Looney Jr. of New Haven.
“This plan absolutely must come before the legislature for a vote,” Fasano said.
“How could it not?” said Pat O’Neill, spokesman for Klarides, the House minority leader. “This is no trivial matter. This is literally going to be affecting generations to come.”
Malloy and the State Employees Bargaining Agent Coalition (SEBAC) announced a deal Friday that attempts to hold down annual pension costs, otherwise set to spike over the next 16 years. In exchange, Connecticut would shift at least $13.8 billion in estimated pension expenses owed before 2032 onto a future generation — and possibly significantly more.
SEBAC’s governing board approved the agreement last Thursday.
The General Assembly still must consider the deal. And if the legislature follows its track record of the past two decades, it will not vote on the matter.
Under existing rules, the legislature can adopt worker contract amendments and arbitration awards without voting to do so. Such contracts are deemed approved if, within 30 days of their filing with the House and Senate clerk, they have not been rejected by either chamber.
The clock would begin ticking on the new pension agreement on the opening day of the 2017 regular legislative session, which is Jan. 4, and — unless voted down — it would be ratified 30 days later.
O’Neill noted that the last time the legislature voted on a contract was in 1997, when an arbitration award granting raises to Correction Department workers was rejected.
The University of Connecticut and the union that represents its non-teaching, professional staff withdrew a tentative, five-year contract last March amid speculation that it otherwise might be rejected by the legislature. That deal would have provided pay raises of between 3 and 4.5 percent annually in return for increasing the work week from 35 to 40 hours.
The contract, which was expected to cost an additional $94 million over the five years, drew criticism from Malloy and from legislative leaders from both parties.
Republicans have argued repeatedly in recent years that contract approval-by-default is unfair and allows majority Democrats in the legislature to endorse pay hikes for unionized workers and other labor deals without having to vote for them.
Democrats counter that Connecticut has more than a dozen bargaining units in the Executive Branch alone, and that requiring a vote on all of their respective contracts would provide lots of ammunition that political opponents could use to distort a legislator’s position on salaries.
House Majority Leader Joe Aresimowicz, D-Berlin, who is the Democrats’ choice to become House speaker next month, called the new pension agreement “a great step toward increasing stability and managing the long-term obligations of the state, and shows the willingness by all parties to come together for the benefit of Connecticut taxpayers and the health of our future economy.”
Does Aresimowicz anticipate a vote on the deal next month in the House, where Democrats hold a 79-72 advantage?
“The House Clerk’s Office has not yet received a copy of the final agreement, so it is too early to make a decision on the actions that the General Assembly will take,” he said Monday. “Once we have received the final agreement, we expect it to be handled in accordance with the rules of the General Assembly.”
Republicans gained ground during the last election, and the Senate now is split 18-18, marking the first time Democrats haven’t held the majority since 1996. Lt. Gov. Nancy Wyman, who casts tie-breaking votes in the Senate, is a Democrat, giving that party an edge.
Like Aresimowicz, Senate Democratic Caucus spokesman Adam Joseph did not say Monday whether his caucus would bring the pension to a vote next month. “After the rules for the Senate are adopted, and once the agreement has been submitted, we will proceed in the appropriate manner,” Joseph said.
Looney said Friday, shortly after the deal was announced that, “On its face, it appears that this agreement takes a balanced approach to ensuring that Connecticut meets its long-term obligations while better adjusting to changes in the market. I look forward to fully studying the agreement before commenting further.”
Fasano and Looney have been negotiating for weeks over how the two parties will share power in the Senate during the upcoming session, and those talks were expected to include what issues, if any, the Republican caucus could place on the Senate calendar for a vote.
Both Fasano and Klarides have been critical of this new pension restructuring, arguing that it has one glaring omission. It neither reduces pension benefits nor increases workers’ contributions into the system.
“Quite simply, our children and grandchildren will get stuck with the bills,” Klarides said. “… We cannot solve this problem by looking at only one side of the equation.”
“This is an incomplete bailout of a pension system that’s completely out of control,” Fasano said. “Simply refinancing our debt is not the structural change we need to change the direction of our state. … You can’t add extra costs onto taxpayers that they will have to bear forever without also offering changes to provide future relief and reduce expenses.”
Had Malloy insisted upon such a contribution from workers, however, he might have been denied the ability to restructure pensions entirely.
Any deal affecting workers’ benefits or contributions would require approval from rank-and-file union members, and not from just union leaders.
And labor leaders have warned repeatedly in recent years that workers, who granted concessions in 2009 and 2011, believe they have given sufficiently, and that legislators should consider tax hikes on the wealthy and on major corporations to meet new budget challenges.