Letter: Pension problems haven't been addressed
To the Editor:
I am writing in response to a letter from Jack Testani, chair of the Trumbull Republican Town Committee, that appeared in the Times. In an election year you can expect each side to paint their actions in the most favorable light and, in doing so, stretch the truth a bit. Mr. Testani’s letter contains many of these exaggerations and in some cases, complete fabrications. However, one obnubilated comment he made needs to be corrected as it could lead the public into a false sense of complacency. I refer to his comment that the pension problem in our community has “been addressed.” That is wrong and in fact, under the current administration, has gotten worse.
There are two key pension vocabulary terms, Actuary Recommended Contribution (ARC) and funding “ratio.” For a pension plan to be completely healthy the annual contribution by a municipality to a pension fund must be 100% of the ARC and the funding ratio for that plan must be 100% — meaning that there exist in the pension plan sufficient funds to meet pension obligations. In Trumbull, we have two pension plans, the Police and the Town pension plans. Let’s look at both.
In the Town plan we will, in the 2013-2014 budget, meet the ARC contribution level for the first time. This is good news but it is only half the story. The current ratio for the Town Plan that should be at 100% is only around 28%. In fact, under the current administration in the last year alone this ratio declined from a very bad low 30% to the abysmal 28%. I doubt you will hear much about this awful fact.
For the Police plan this is nothing but bad news. The ARC funding for the police plan is slightly better than half of the recommended amount. Further, the ratio for funding is in the high 50’s, better than the Town plan but still pretty awful. Here to, under the administration in the last year the Police plan also DECLINED from the low 60% to the awful high 50%.
As a candidate nearly four years ago, Mr. Testani's Republicans called pensions a “ticking time bomb.” For full disclosure, I was one of those Republicans four years ago and I still believe the pensions are a big issue to this day. I have since done the research myself instead of listening to the political sound bites uttered by Mr. Herbst and then regurgitated by Mr. Testani.
Unlike Mr. Testani, it is important to be balanced in discussing this issue ,so I will say that the current administration, as did Mr. Baldwin and Mr. Halaby before them recognized the problem and took some steps to mitigate it. However, to say, as did Mr. Testani that the problem has been “addressed” begs the question when and by whom? The facts clearly show that our pensions remain a problem and are getting worse.
Board of Finance (D)