ELECTION 2011, THE ISSUES: The Pension Fund

It's nothing new, and it's not going away any time soon.

Hamden's pension fund needs an injection of cash, but how that will happen is up for debate. And it was last week at the Hamden Chamber of Commerce's mayoral debate.

"The pension is about dollars, and it is funded at about 26 percent," Democratic incumbent Mayor Scott Jackson said, "one of the lowest percentage in the state.

"Does that mean we are going bankrupt? No," he said.

In 2000, the fund was funded at about 70 percent, he said, but two years later that dropped to 50 percent. And since then, it's been even touger to keep the cash flowing into the account because of the economic downturn, he said.

"The economy has an impact, as well as what we decide to put into it," he said.

Newly hired town employees no longer are part of the town's pension plan, but instead participate in a state plan. And town officials are looking into instituting a 401K option for new hires, Jackson said.

They also are looking into pension obligation bonds, a contraversial move that would allow the town to bond the money it needs to bring the pension fund up to recommended funding levels.

"We need an influx of cash into the fund to generate additional income," Jackson said. "We are going to have to have a broad community conversation about how to fill this hole."

"In some ways, it's a ticking time bomb," said Republican challenger Matthew Corcoran. "This is one of the few problems in government that can only be solved with money."

The town's auditors recommended that $19 million be put into the fund this year, but only $3 million was allocated for it, Corcoran said. 

"We simply need to make a commitment to putting more money in it," he said.

But pension obligation bonds aren't the way to do that, he said.

"I am opposed to borrowing on taxpayer money," he said. "You could end up losing money that way."

He's also opposed to the proposed revisions to the Town Charter that allow officials to go that route, he said. 

"I'm opposed to giving the town authority for non-capital bonding," he said.

Independent mayoral candidate Charles Baltayan agreed. The problem is that the pension benefits of the past were more than the town could afford, he said.

"Many in town feel that the pensions town employees get don't mirror what the rest of us have, and that's just not right," he said. "Most corporations don't even offer pensions."

The town needs to terminate its pension program, Baltayan said. 

"It's not a good thng to do to people who put their trust in us to take care of them after they work for us," he said. "But we just can't afford it and we have to find a creative way of dealing with it."

It's not legally possible to terminate town pensions, Jackson said.

"If we could, we would have," he said. 

It's also not realistic to think the town could have afforded to put $19 million into the fund this year, Jackson said.

"But if we're bound to put money into it," Baltayan said, "why haven't we?"

"Nineteen million dollars is several mills of taxes," Jackson said. "There's no easy answer to this and it's going to take a lot of hard work."