Pension Agreement Will Stabilize State’s Finances

January 24, 2017

On a bipartisan vote, the legislature’s Appropriations Committee approved an agreement between the executive branch and state employee bargaining units that will help stabilize the state’s long term pension payment obligations.

The status quo meant mortgaging our future – without this agreement, the current annual payment would grow from $1.5 billion to nearly $6 billion by 2032 – that would impact funding for education, funding for seniors, funding for mental health.

This is the end of the decades-old policy of ‘kicking the can down the road.’ We are taking a responsible approach that will require us to pay slightly more up front, then manageable amounts over the years, rather than face consistently rising payments.

When I speak with financial professionals the consensus is: This is a step in the right direction. When I speak with bond analysts I receive the same response. They may not love every facet of the bill but given the enormity of the cost of inaction, doing nothing is unacceptable and fiscally dangerous. We need to act. And the situation is too serious to let the perfect be the enemy of the good, the necessary and the predictable. Furthermore I don't see it as 'reform' but a demonstration of our commitment improving our states fiscal position.

The agreement will be voted on by the full General Assembly.

Rep. Perone is a member of the Legislature’s Appropriations Committee