NEW LONDON, Conn. (WTNH) — The current pension plan for municipal employees in more than 100 cities and towns in Connecticut has been around since President Truman was in office.
Now more than 70 years later State Comptroller Sean Scanlon says he hopes new reforms are approved by lawmakers to make the pension plan for municipal employees more sustainable.
State Comptroller Sean Scanlon said he worked with Republicans, Democrats, as well as labor and management leaders to reform the pension plan used by the 107 cities and towns which make up the Connecticut Municipal Employees Retirement System (CMERS.)
“He has managed to do the impossible within a very short period of time,” New London Mayor Michael Passero said.
In recent years they have had to pay more and more to keep it funded.
“Cities and towns like New London were having to find 75% of increases in money in their already strapped municipal budgets,” Scanlon said.
With six major changes, they will see a total savings of more than $32 million in 2024 and then more than $843 million over the next 31 years, according to Scanlon.
State leaders announce municipal retirement system reform
The biggest savings will come with a change to the cost-of-living adjustment that retirees get with their pension (COLA.)
“We’re not taking COLA away. We’re not changing any benefits of the actual pension. We’re just changing how the COLA is calculated,” Scanlon said.
That change means those who retire will have to wait a full fiscal year before they see the cost-of-living increase.
“Because of the delay for the fiscal year if you leave after the July 1 date you can be waiting almost two years before you get your first raise on your cost-of-living increase,” said Josh Bergeson, president of the New London Police Union.
If lawmakers approve this pension reform proposal it could save New London $951,000 in 2024 alone and $28,625,000 over the next 30 years.
The city is still trying to work out what the potential savings could mean for the current budget.
But the hope is that it would be able to fund four police officer positions, which have now been put on hold.
“Officers back to being able to walk in their neighborhoods and to interact with our community and I think that’s huge,” New London Police Chief Brian Wright said.
The idea is to make the pension plan sustainable for the current employees.
“Make police work more attractive for everyone when you have a divine pension like that opposed to a 401K,” Bergeson said.