On the one hand, it’s not exactly news since it has happened every year for 17 years. On the other hand, it’s almost unheard of, both in surrounding towns and even at the state level.
Bristol’s city pension fund has been overfunded for nearly two decades, while, earlier this year, it was announced that the state faces a deficit of $4.3 billion in unfunded pension liability.
“The (Bristol) police and firefighters funds became overfunded because the city made investments in the 1970s that saw growth in the ’80s and ’90s,” said city Treasurer Thomas Barnes. “The city also sold real estate funds in 2007 and avoided the market crash other cities didn’t.
Put another way, the city has been blessed with wise overseers of its pension fund for several generations. Contrast that with years of skimping on contributions at the state level, a practice that Gov. Dannel P. Malloy initially promised to correct - before he was faced with a recession.
As of July, the state has enough assets to cover 35 percent of the long-term obligations in its pension fund for state employees - whereas 80 percent is considered healthy. And earlier this year it struck a deal to shift $14 billion to $21 billion in pension contributions until after 2032.
There’s nothing new here. According to The Connecticut Mirror, “Connecticut has a history of saving poorly for its public-sector pensions, a problem that dates back to 1939.”
Obviously, with the state still struggling to agree on a budget, there’s no immediate cure in sight but when - if? - lawmakers manage to get past this current situation, they would do well to learn from Bristol’s sound fiscal example.