Don Turner: The Vt. legislature’s irresponsibility on pensions

Link: https://www.benningtonbanner.com/opinion/columnists/don-turner-the-vt-legislatures-irresponsibility-on-pensions/article_2def298e-9d2d-11eb-8652-6349f8c9cf60.html

Excerpt:

The last thing you do in the middle of a crisis is kick the can down the road. Yet, that’s exactly what the legislature just did on Vermont’s mounting pension liabilities.

Earlier this year, State Treasurer Beth Pearce delivered a long overdue message to the legislature — calling for painful cuts in order to keep the state employees’ and state teachers’ pensions operation. This comes years after resisting calls for structural reform to the pension system.

However, the treasurer deserves recognition for having the courage to at least present a plan. The legislature did too — with leadership in the House Government Operations Committee unveiling its own similar plan.

Author(s): Don Turner

Publication Date: 14 April 2021

Publication Site: Bennington Banner

Pension debate could spur teachers, state employees to retire early

Excerpt:

While many may be talking about early retirement, few are actually driving off into the sunset in their Overland campers — yet. According to figures provided by Pearce, about the same number of people put in for retirement during the first three months of 2021 as during January, February and March of last year.

But her office did see a “significant increase,” she said, in employees asking about how much it would cost them if they purchased enough retirement credits to exit the workforce early.

Author(s): Lola Duffort

Publication Date: 11 April 2021

Publication Site: VTDigger

Look Ahead, Vermont: Pensions, Act 250 reform, and what’s in a name?

Link: https://www.reformer.com/look_ahead_vermont/look-ahead-vermont-pensions-act-250-reform-and-whats-in-a-name/article_5e64cade-9ae3-11eb-906e-3f0b80878609.html

Excerpt:

The high drama might be over for a while, but pension reform remains a high priority in the Legislature.

This week, the House Government Operations Committee is considering a new draft proposal to expand the membership of the Vermont Pension Investment Committee (VPIC) and establish a task force to study possible solutions to the state’s thorny unfunded pension liability problem.

This is the other shoe from House leadership’s decision two weeks ago, under pressure from state employee unions, to focus on governance now and study the solutions to unfunded liability over the summer. The unions had widely panned the initial proposal for reform as forcing them to work longer, pay more, and get less.

That liability is estimated at $5.6 billion, with about $3 billion in pension benefits and another $2.6 billion in health and other benefits for retirees.

As a committee draft proposal, it doesn’t have a bill name. That makes finding it on the relevant committee page a little more challenging. In this case, if you go to the documents tab on the Government Operations page there’s a “pensions” folder. Click on that, and on “bills,” and there you will find “21-0967 — An act relating to the membership and duties of the Vermont Pension Investment Committee and the creation of the Pension Design and Funding Task Force.”

Author(s): Greg Sukiennik

Publication Date: 11 April 2021

Publication Site: Brattleboro Reformer

Vermont Pension Reform Plan Blasted by State Teachers, Workers

Link: https://www.ai-cio.com/news/vermont-pension-reform-plan-blasted-state-teachers-worker/

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Excerpt:

A plan proposed by Vermont lawmakers to bolster the state’s pension systems, which are facing nearly $3 billion in unfunded liabilities, has been resoundingly panned by state teachers and public employees who said they felt abandoned and betrayed.

According to a draft of the pension reform plan released by the state’s House lawmakers, teachers and state employees would be required to pay more in contributions to the fund, stay in the workforce longer, and get less in monthly benefits when they retire. Additionally, cost of living adjustments (COLAs) would apply only to the first $24,000 of the retirement benefit, and to be vested in the program, employees would have to work twice as long—a minimum of 10 years from the current five.

Author(s): Michael Katz

Publication Date: 30 March 2021

Publication Site: ai-CIO

Vermont teachers, state employees say they were ‘blindsided’ by proposed pension fund plan

Excerpt:

 bill in the Vermont Legislature aimed at taking on a growing deficit in the state’s pension fund continues to face opposition from teachers and state employees.

At a public hearing on Monday, both groups said they feel blindsided by the bill, specifically the burden it would place on them to reduce the $5.8 billion shortfall in the pension system.

“If this is what it’s like to be a state employee, I’ll tell my kids and my grandkids don’t ever come and work for the state,” said Greg Machia. “I never thought in my 30 years I’d be talking about pensions.”

The legislation would have state employees and teachers pitching in more toward their pension plans, while increasing the age most workers would see retirement benefits.

Author(s): Devin Bates

Publication Date: 29 March 2021

Publication Site: myChamplainValley

Mark Crow: The time is now for meaningful Vermont pension reform

Excerpt:

What if you owed someone a substantial amount of money and were making annual payments each year to pay down the debt. However, every year, year after year, the amount you owe and the annual payments you must make increases — significantly.

Now, what if, at the same time, you owed someone a separate substantial amount of money but there was no schedule to pay it back. You were making some intermittent, smaller payments when the lender periodically asked for them, but there was no plan in place to pay off the entire debt. And, like the first debt, each year, the amount you owe increases — significantly.  

Meanwhile, you’ve got other essential expenses — car and house payments and maintenance, child care, food, clothing, medical care, etc. But, with those large debts continuing to increase, you are finding that you can’t afford to pay for some or all of these essential expenses. You could try to borrow money to pay for them but, because of those troublesome and ever-increasing debts, your credit score is low (and is at risk of being further lowered) and the only loan you can get, if you can even get a loan, will bear interest at a high rate.

Author(s): Mark Crow

Publication Date: 29 March 2021

Publication Site: VT Digger

Employees voice concerns over new state pension proposal

Link: https://www.mynbc5.com/article/employees-voice-concerns-over-new-state-pension-proposal/35972945

Excerpt:

The proposed changes would make public employees work longer hours and contribute more money. When it was time to receive the pension, there would be less.

The proposed budget has $150 million for the pension program.

“We just have to take a look, do the best we can to protect those who are heavily invested,” Governor Phil Scott said on Friday. “We’ll come to some conclusion hopefully they come through but these are difficult times when the majority party is faced with this much pushback.”

This plan, brought forward by Democrats, is receiving heavy backlash from the teachers and police unions.

Author(s): Carolyn Sistrand

Publication Date: 30 March 2021

Publication Site: NBC 5

Vermont lawmakers seek pension reforms to stem funding shortfalls

Link: https://www.pionline.com/pension-funds/vermont-lawmakers-seek-pension-reforms-stem-funding-shortfalls

Excerpt:

Vermont lawmakers are pushing a plan to reduce a widening shortfall in the state’s retirement systems by asking teachers and state employees to pay more into their pension plans and work more years.

During a March 24 meeting, the Vermont House Government Operations Committee proposed teachers base contribution rates be raised by 1.25% to 2.25% and that most state employees be increased by 1.1%, according to a proposal posted on the Vermont General Assembly website.

The proposal also bumps up the age at which most workers can qualify for retirement benefits, requiring them to reach full Social Security retirement age, which is currently 66 or 67. Some groups of teachers and state employees can now retire as early as 62 or with 30 years of service.

Author(s): Margarida Correia

Publication Date: 29 March 2021

Publication Site: Pensions & Investments

‘A gut punch’: Teachers, state employees have their say on pension reform

Excerpt:

In January, Beth Pearce, the state’s treasurer, dropped a political bomb, recommending painful cuts to the state employee and teacher pension systems in an effort to keep the system afloat in the long term. Top lawmakers in the lower chamber kept their cards close to the vest for months, working behind the scenes to craft a response, which was finally released Wednesday in the House Government Operations committee.

Between trimming benefits and asking for higher contributions, the House proposal would cost school workers a cumulative $300 million. For state employees, the cost would be about $200 million. Legislators are offering to pitch in more state dollars, too — an extra $150 million one-time contribution. (The proposals in play would not touch benefits for current retirees or those within five years of retirement.)

There are many reasons why Vermont finds itself staring down the barrel of a nearly $3 billion unfunded liability in its state employee and teacher pension systems. The funds have consistently fallen short of expected returns, and demographic trends also contribute to the problem. But one of the biggest culprits has been several generations of Vermont’s political leaders, who for decades shorted their contributions to the system

Author(s): Lola Duffort

Publication Date: 29 March 2021

Publication Site: VT Digger

Vermont lawmakers seek pension reforms to stem funding shortfalls

Link: https://www.pionline.com/pension-funds/vermont-lawmakers-seek-pension-reforms-stem-funding-shortfalls

Excerpt:

Vermont lawmakers are pushing a plan to reduce a widening shortfall in the state’s retirement systems by asking teachers and state employees to pay more into their pension plans and work more years.

During a March 24 meeting, the Vermont House Government Operations Committee proposed teachers base contribution rates be raised by 1.25% to 2.25% and that most state employees be increased by 1.1%, according to a proposal posted on the Vermont General Assembly website.

The proposal also bumps up the age at which most workers can qualify for retirement benefits, requiring them to reach full Social Security retirement age, which is currently 66 or 67. Some groups of teachers and state employees can now retire as early as 62 or with 30 years of service.

In addition, employees will receive a lower overall benefit as it would be based on the average of their seven highest consecutive years of salary rather than the three highest as is now the case, according to the proposal.

Author(s): Margarida Correia

Publication Date: 29 March 2021

Publication Site: Pensions & Investments

Emilie Krasnow: My mother dedicated her life to teaching. Fund her pension.

Excerpt:

This year, teachers have faced more adversity than ever before. I have heard from many educators, union members and parents how scared they are. They are not vaccinated. They are working more hours than ever. They are worried about their students. This is not the time to take away the promise of their retirement stability. 

I am calling on our state legislators and our governor to find alternative revenue sources to fund the retirement plans for teachers and state employees. I am grateful for the hard work of the legislators, union leaders and educators who are collaborating and strategizing to address this issue.

Just a year ago, we were lauding our teachers as “heroes” and “essential workers.” It’s time to put our money where our mouth is and fund their pension program. 

Author(s): Emilie Krasnow

Publication Date: 15 March 2021

Publication Site: VT Digger

Vermont Treasurer Calls for Pension Cuts for State Employees, Teachers

Link: https://www.ai-cio.com/news/vermont-treasurer-calls-pension-cuts-state-employees-teachers/

Excerpt:

Vermont Treasurer Beth Pearce released a report containing recommendations that she said could reduce pension UAAL for the Vermont State Employees’ Retirement System (VSERS) and the Vermont State Teachers’ Retirement System (VSTRS) by $474 million and reduce the actuarial determined employer contribution (ADEC) by $85 million.

“While shy of the total target of $604 million in the UAAL and $96.6 million for the ADEC, it is a significant reduction to the existing liabilities and costs to the taxpayer,” said the report, which added that the net other post-employment liabilities could be reduced by $1.68 billion by directing a “minimal amount” of funds for prefunding. “All in, these recommendations will reduce the state’s post-employment liabilities by $2.2 billion.”

Author(s): Michael Katz

Publication Date: 21 January 2021

Publication Site: ai-CIO