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Council Gets Pension Bond Report Next Week

The Hamden Legislative Council will hear from the Segal Company on Jan. 31 on whether it should consider pension obligation bonds as a way to shore up the flailing pension fund

 

A key component to the town's future fiscal health will be on the table next week when the Legislative Council hears from the consultants it hired to advise it on whether it should consider pension obligation bonds.

The Segal Company will make the presentation to the council Jan. 31 at 7 p.m. in the Miller Library Complex Thornton Wilder Auditorium.

Last May the council approved hiring Segal to investigate and report back on whether the town should consider pension obligation bonds to shore up its pension fund, which is about $300 million short of where it should be.

But if the town were to go with the bonds, it would not be for the full amount, but for only about a third of the shortfall. Other measures have to be taken, town officials have said, such as union concessions and changes to the plan itself, for it to stay solvent.

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The pension plan has been closed to new employees for several years. Newly hired employees are offered other options that do not add to the town's future pension burden, but the town is required to provide for those employees who were hired under the provisions of the fund or have already retired and are collecting under it.

If no action is taken and the fund is depleted, payments to retirees would have to be made from the operating budget, and taxes would have to increase to accommodate those payments.

The council will soon begin work on the 2013-14 budget and needs to decide how it will handle the issue of pension obligation bonds before that in order to know how much it needs to allocate to the pension fund. This year, it put $9 million toward the pension fund, those auditors recommended an allocation of $20 million.

cheryl January 24, 2013 at 01:39 PM
HAS ANYONE INVESTIGATED THIS COMPANY & WHY DID OUR LEGISLATIVE COUNCIL WAIVE THE BIDDING PROCESS? Let me say after a little research- that most officers of this company are or were public sector union affiliates. They seems not to be interested in us (the taxpayer) but how they can provide a more comprehensive ( full) retirement benefits for their public sector employees. AS the Affortable healthcare provisions kick in- they need to sell these added expenses to the public-(us tax payers). Lets not forget WE PAY THEIR SALARIES, BENEFITS, ETC. We must attend that meeting- Another question is why is our legistlative council alway using these outside consulting firms, example: traffic calming (Fitzgerald & Halliday ), ICELI ( International Council for Envirormental Local Initatives) and now another consulting firm. Doesn't anyone care except me how our tax dollars are spent. In that case - the word INTERNATIONAL- Should have sent up red flags. Why are we spending our tax dollars on INTERNATIONAL agencies located in GERMANY? This Segal Company is not looking our of our interests - its looking out for the unions interests. Thats why they were hired by our legislative council.
George Levinson January 24, 2013 at 07:52 PM
Nice comprehensive report and a good comment from Cheryl. We all know the limitations of bonding and that the town cannot fully address the problem with that alone. The actuary's report must evaluate the impact of concessions. If the town were to bond 100 Million there will still be a 200 Million problem. Plus the problem could be even bigger than we think because all the calculations depend on a consistent 8% return on investments which is very optimistic. The most significant union concessions involve raising the retirement age and lessening or even eliminating COLA. If the actuaries didn't thoroughly evaluate those options their report won't be worth the paper it's written on.
Dave M January 25, 2013 at 01:58 PM
there is only one way out of this impossible mess....the Town of Hamden should declare bankruptcy....this pension obligation will not go away and bonding it is as stupid as financing a car for 20 years...another tax increase and I am selling and moving out of this fiscally inept town
George Levinson January 25, 2013 at 08:50 PM
Dave, Don't leave town. Show up at Council meetings and let them know that the only answer is to get serious concessions from the unions. Everyone knows that a system that allows people to retire in their forties with lifetime pension, with guaranteed COLA and benefits is not sustainable. Reasonable workers will be happy with later collection and reduced increases provided the town meets them halfway..
Dave M January 29, 2013 at 03:59 PM
I don't realistically seeing unions giving in much. What i do know as fact is: 1. pension liability will not go away 2. I have researched adjacent towns and they properly fund their pensions 3..For the same amount of taxes I pay now, i can have a much bigger house in a more rural setting. 4. The towns I am considering have much less crime statistics 5. School system performances are much better. 6. Public works does a much better job maintaining roads and infrastructure. I can go on and on, but my conclusion is rather obvious.
KJ January 29, 2013 at 10:19 PM
Workers that are retired are not represented by the unions.... the pension agreement is with the individual and the unions have no say over a retired workers pension. The union can only negotiate between an active worker and the town
Larry January 29, 2013 at 11:35 PM
Dave,hurry leave town!!! Now!!! Goerge, Get your facts straight before you comment.Besides the police and fire i don't know of anybody retiring @ 40.Most employee's i see around town look alot older then 40. just saying. You said- "Reasonable workers will be happy with later collection and reduced increases provided the town meets them halfway".. What planet do you live on? It's sounds like your not to happy with your retirement benefits and are jeaulos that you don't have it as good as some people. Thats the choice you have made now deal with it.
George Levinson January 30, 2013 at 05:12 AM
The fact is that eiight of the 25 people that got the Mayor's stupid retirement incentives this year were in their 40s and none of them were Guardians. They were given a bonus to retire and many got to buy extra years of service with sick time. All these people also get COLA compounded on their increased benefit.every year for the rest of their lives. Guess you're a town worker Larry? Or maybe you just don't get it.
cheryl January 30, 2013 at 02:11 PM
The problem with public unions is THERE IS NO COMPETITION. When a raise, beneifts, pensions are increased it comes out of our pockets. They have what you call a monolopy. Their only means of funds come from us. We do not have a choice whether to go to a union shop of non-union shop. Example: We need electrical work done at our house, we can either go to a union company say for $500 or a non-union electrician for $150. Go to Stop and Shop (union) and pay highter prices or Shop Rite and pay lower prices (non-union). Again, we have a choice. In a public unioin ther are NO choices. That's what makes public unions a bad idea, and hurts all property tax payees. I wonder how many X union members are on the Legislative council in Hamden. Does anyone know. Now the NGO (SEGAL)that they have hired is filled with either X union members, lawyers for unions, and active union members. WHO DO YOU THINK THEY ARE REPRESENTING? taxpayers or union members?
Dave M January 30, 2013 at 02:18 PM
I think we can all agree that the pension situation has been caused by mayoral administrations historical underfunding. Since these pension obligations are contractual, the obligation to pay them exists. I am quite sure most residents in town would like to see a zero tax increase or even a tax decrease. Since it appears that the State of Connecticut is also in financial dire straits, you can be rest assured that monies in the form of town/city aid will be likely reduced. With income staying stagnant or reducing, the only way to accomplish this is cut expenses. Bond obligations are financial instruments that must be considered funded wholly. Therefore, the goal of reducing expenses would be in the form of layoffs. A 10% or greater would at least get us near zero increases, as salary expenses would drop as well as the huge medical expense line item. These layoffs must impact ALL departments on the town side of the budget...police, fire, public works etc. As an example, 2 deputy police chief slots should be eliminated, as a town of under 60000 does not need 3. On the Board of Ed side, Superintendant Rabinowitz needs to find a way to have 0 dollar increase...3 more administrator positions do not need to be added...existing personnel would have to take up the slack. Taxpayers are not piggybanks, and somehow, it appears that both the mayor and superintendant of schools do not have the strength to make difficult decisions to relieve the burden on Joe Taxpayer.
cheryl January 30, 2013 at 09:29 PM
It would be a different but effective idea if we went to the private sector for park & rec. Just think with a private companies bidding on the projects, lawn maintenance, tree service, etc. or maybe get one company to do all, they would work longer, be effiicient, effect competition among the bidders with a contract that expires every 2 yrs. Then the town union wages, town benefits, and town pensions wouldn't be an issue. Many towns in the south are doing this and not raising taxes on their residents. How does that sound?
cheryl January 30, 2013 at 09:39 PM
Of course the town would not renew their union contract if they decide to go with the private sector for employees. Would that be a great idea. Office personel, public works, park and rec, everything but fire and police. Just think the money the town would save without paying for union wages, union benefits, union salaries, union pensions. Bet the unions would have a fit, as we laugh all the way to the bank for a change. The unions are bleeding the towns and cities with their public union contract that the residents can't pay unless they raise our taxes and it doesn't look like our taxes are going anywhere but UP. Between UN Agenda 21-sustainable development and paying our tax dollars to these new INTERNATIONAL NGO'S-i.e. Segal, ICLEI, as we still pay 22% of our federal tax dollars to the UN. ????? why are we knowingly doing this and not complaining. We need to go to this meeting and voice our opinions against this legislative council wasting our tax dollars. We need to vote them out at the next election. We, in Hamden need a change.
Dave M January 30, 2013 at 11:17 PM
Many towns feel the pain of providing services while paying close attention to the costs of such. To make good use of manpower and equipment etc, perhaps regionalization of key services will reduce costs for everyone. The same quality of services can be had by pooling resources, while reducing overall costs. Connecticut is weird, in the fact that most towns are run like little kingdoms. I would favor regional or county police and fire services, just like you would find in just about all other states and in Canada. Large cities retain their own forces. Hamden hardly quantifies as a large city. Schools can do likewise...pool your strengths and resources...everybody benefits. Again, this would reduce capital expenses and manpower required to provide the exact same services. I can see many political entities cringing at this idea of losing their power. We have been trusting them so far with this political power, but obviously, it is not working. Now is the time for the common folk to take back government and demand accountability. It may take more than replacing political leaders, it may also require changes in how government is operated. Regionalization provides checks and balances and prevents political power plays.
cheryl February 01, 2013 at 02:24 PM
Has anyone done any research to the eqivilant democratic districts (towns) vs republican districts. Inquiring minds want to know. It would certainly be interesting....

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