Only through making painful cuts to spending can the Legislature ‘admit guilt’ to taxpayers in their willful neglect of fiscal responsibility. Let’s not let them shift the blame for underfunded pension to taxpayers.
The state’s largest union for public workers, the Vermont-NEA, is asking that the state use as much federal money as possible from its massive $5 billion influx over the past year to pay down an ever-increasing liability in its pension program.
Rejiggering the pension commission and creating another task force is kicking the ever-larger can — now the size of a bulk tank — further down the road.
House leadership admitted last week that if we had followed the recommendations from 12 years ago our pension funds wouldn’t be in the shape they are today. A number of other pieces of legislation, including ethics, broadband, and economic development also moved forward last week.
State Treasurer Beth Pearce and some lawmakers from the Senate Government Operations Committee were at odds Wednesday over the proposed creation of an oversight commission to make recommendations on the state’s ongoing public worker pension crisis.
The economic development bill found itself in hot water this week as senators look to slash funding for a number of projects — some of which may be critical to economic recovery. The pension discussion is moving from the House to the Senate as well.
Some Democrats are getting scared and are starting to see the political writing on the wall. Just this week, Democrat Lt. Gov. Molly Gray and U.S. Sen. Patrick Leahy both came out in favor of the repeal of military retirement taxation — standing in stark contrast to their own caucus. It’s about time.
S.53 failed in the State House of Representatives on April 15, 2021, by a vote of 55-79. The bill would exempt the first $10,000 of military pensions from the state income tax.
This week lawmakers gave approval on expanded bottle recycling and changed course on how to address Vermont’s pension crisis. Also, the state suspended use of the Jonhson & Johnson COVID-19 vaccine due to reports it is causing blood clots in some patients.
The last thing you do in the middle of a crisis is kick the can down the road. Yet, that’s exactly what the Legislature just did on Vermont’s mounting pension liabilities.
The state has overpromised and underfunded the pension funds for teachers and state workers for so long that taxpayers now carry a $5.8 billion unfunded liability. Those are promises the state doesn’t have the money to pay for. Now it’s impossible to ignore by even the most obtuse lawmaker.
If we had acted five years ago when the Vermont Business Roundtable and Campaign for Vermont again brought these issues forward we still probably could have avoided it. But now the deficit is twice as large as it was in 2015 and adjusting benefits for new hires isn’t enough, we need to make structural changes.