The usual attacks on state employees continue in the 2018 Legislative Session. Several bills have been introduced at the Legislature which seek to curtail state employee benefits but this session added a new twist: a Fiscal Stability Commission was convened and submitted a report to the legislature. This Commission was created as part of the 2017 Budget deal and is comprised of CEO-types which quickly earned them the nickname of "the Yacht Club" or the “Let Them Eat Cake Commission”. Their report has been released and it covers a wide range of issues but includes suggestions to reduce pension payouts while increasing state employee contributions for benefits.
We want members to be aware of what is happening at the Capitol as these issues continue to crop up. On Friday March 23rd , several Legislative committee hearings will be held to discuss the Commission’s Report. Simultaneously, employee unions will be holding a “Let Them Eat Cake Rally” outside their doors. All members are encouraged to gather at the State Capitol around 1:00 pm and hear the voices that are speaking against us and those who support us.
Most importantly, we want you to be aware of this:
Any attempt to thwart the 2017 SEBAC agreement by legislative fiat will be met with rigorous legal challenges. The 2017 SEBAC agreement expires in 2027. The state cannot unilaterly change that. We have neither the need nor the desire to reopen SEBAC. To be clear, we have no intention of revisiting the 2017 SEBAC agreement. We intend to have it enforced.
In short, the proposed bills, if passed into law could result in all or some of the following:
- Implementing annual insurance deductibles of $2,000 per individual or $4,000 per family
- Increasing healthcare cost contributions by 1%
- Eliminating COLAs for all current and future retirees until the pension fund is funded at 80%
- Eliminating the breakpoint after 2027 (thus reducing your pension)
- Increasing pension contributions to 7% of salary after 2027
- Eliminating overtime from pension calculations for non- hazardous duty employees
- Restricting overtime to 50% for pension calculations of hazardous duty employees
- Eliminating retiree healthcare coverage for new hires
- 5 year look-back rather than 3 for pension calculations
- Increasing pension contributions by 4% in October 2018
- Replacing defined benefits with 401ks for new hires effective January 2019
- Suspending pension COLAs until biennium budget is balanced
- Increasing health insurance copays by 25%
- Restricting former state employees from lobbying efforts
Some of these items, such as healthcare cost increases and pension cost increases, are in direct conflict with the 2017 SEBAC agreement voted on by union members and passed by the Legislature. Such conflicting items will likely not survive the legislative process, as the legislature as a whole is apt to recognize that they cannot undo the 2017 SEBAC agreement by statutory fiat. Nevertheless, they keep trying and we keep showing up to oppose them. We will make our presence known at the Capitol. At times, we will be asking for your help.
Here is a sampling of the proposed bills hostile to state employees, with links to the actual proposals:
HB 5068 Effective upon passage for all nonunion and newly hired state employees, and effective on and after July 1, 2027, for all unionized state employees: (A) Pension payments shall be computed without a breakpoint; (B) the employee contribution for all plans under the state employees retirement system shall be seven per cent of salary; (C) for nonhazardous duty employees, pension payments shall be computed without overtime and for hazardous duty employees, pension payment calculations may include fifty per cent of overtime;
(2) Effective upon passage of this act, for all current and future retirees, no retiree shall receive a cost-of-living allowance until the funded ratio of the state employees retirement system reaches eighty per cent;
(3) Effective on and after July 1, 2021, and until June 30, 2024, the wages of all union and nonunion state employees shall not be increased;
(4) Effective upon passage of this act, no newly hired state employee shall be entitled to state retiree health care coverage;
(5) On or before June 1, 2018, the State Comptroller shall provide an actuarial analysis of the savings achieved by the implementation of the changes to the state employees retirement system specified in subdivisions (1) to (4), inclusive, of this act and a revaluation of pension costs pursuant thereto;
(6) Effective upon passage of this act, the terms "hazardous duty employee" and "nonunion employee" shall be clarified to prevent reclassification; and
(7) Effective upon passage of this act: (A) An amount equal to one-third of the Budget Reserve Fund balance as of the effective date of this act, plus any additional amount that is deposited into said fund during the current fiscal year, shall be paid into the state employee retirement system as a one-time additional payment; and (B) an amount equal to one-third of the Budget Reserve Fund balance as of the effective date of this act, plus any additional amount that is deposited into said fund during the current fiscal year, shall be paid into the teachers' retirement system as a one-time additional payment.
Senate Bill 143 That the general statutes be amended to exclude overtime and longevity payments earned after July 1, 2018, from retirement benefit calculations. Effective October 1, 2018, (1) state employee pensions shall be capped at one hundred thousand dollars or the pension amount earned as of the effective date, whichever is higher, (2) state employee pension benefits shall be determined on a five-year look- back, (3) state employee pension contributions shall be increased by four per cent, (4) the assumed rate of return for the state employees retirement system shall be no more than five per cent, (5) employees hired on or after January 1, 2019, shall be enrolled in a 401k plan administered by the state in lieu of the state's defined benefit pension plan, (6) cost of living increases for state employee pensions shall be suspended until projected state budget deficits for the succeeding biennium have been eliminated, and (7) health insurance copays for state employees shall be increased by twenty-five per cent and an additional deductible of two thousand dollars per individual and four thousand dollars per family shall be instituted.
House Bill 5047 That the general statutes be amended to increase the copays under all state employee health care plans by one per cent.
Senate Bill 367 The Commissioner of Administrative Services, in consultation with the State Comptroller, the Secretary of the Office of Policy and Management and representatives of the Connecticut State Employees Retirement Commission, established under section 5-155a of the general statutes, shall review employment and retirement benefits currently offered to state employees and elected and appointed officials to assess the long-term impact of such benefits on the state economy and the effective operation of state government. On or before October 1, 2018, the Commissioner of Administrative Services shall submit, in accordance with the provisions of section 11-4a of the general statutes, the results of the review to the joint standing committees of the General Assembly having cognizance of matters relating to appropriations and the budgets of state agencies. The results shall include recommendations for revisions to such benefits and any legislation necessary to implement such revisions.
State Bill 5174 (section l - last section) No former executive or legislative branch state employee shall, for one year after leaving state service, accept employment or act as a lobbyist pursuant to the provisions of this chapter