Lt. Gov. Michael Fedele called for deep cuts in spending Wednesday, including four-year hiring and spending freezes, merging state agencies, capping the lucrative pensions of state employees, and eliminating the current bonus payments for state employees.
Fedele, who is seeking the Republican nomination for governor, said he would propose no tax increases if he is elected governor in November. And if the Republicans win both the House of Representatives and Senate for the first time in decades, he would pledge to have no new taxes at all.
The state is currently paying more than $1.2 billion annually in pension benefits to more than 42,000 retirees – an amount that Fedele says is simply unsustainable. In addition, the state pension fund is underfunded by $9.3 billion, which he said is “the equivalent of a ticking time bomb” for the state.
“Quite simply, state employees should not enjoy benefits that far exceed those available to the average working person in our state,” Fedele said.
As such, Fedele says all new state employees would enroll in a 401 (k) – style plan that is common in the private sector.
Fedele has been in second place in the Quinnipiac University poll behind former U.S. Ambassador to Ireland Tom Foley – a Greenwich millionaire who has never held public office and has been running statewide television commercials to raise his name recognition. A new Quinnipiac poll on the governor’s race is scheduled to be released Thursday morning.
As governor, Fedele said he would abide by any of the cuts if he is elected governor – including the capping of his pension.
Fedele is also calling for the elimination of “longevity payments” for state employees, which are essentially bonuses that are paid to employees who have more than 10 years with the state. Some of the highest-paid employees receive the most money because the escalator clause allows the highest payments for those with more than 25 years of service.
The head of the Connecticut State University system receives one of the highest longevity payments. Fedele also said the bureaucracy needs to be trimmed significantly in the higher education system, which has four individual presidents for the four campuses in the CSU system at Eastern, Western, Southern, and Central.
“There is no need, I believe, for a central office at CSU,” Fedele said, adding that the state does not need “redundancy” that costs $6.5 million per year.
Both union and non-union employees receive the payments, and state House Republican leader Larry Cafero of Norwalk says that the legislature should move immediately to cut off the payments for the non-union employees that are scheduled to be made in April.
In addition, Fedele says that the longevity pay – as well as overtime – should not be used for calculations in state-employee pensions. He also says that pensions should be calculated simply on the final three years of employment, rather than the current system that bases the pension on the three highest-earning years.
Regarding pensions, Fedele says the payments should be capped based on a maximum salary of $150,000 – which is the governor’s rate of pay. But more than 1,000 state employees are paid more than the governor, and any salary beyond $150,000 would be calculated toward the 401 (k) plan that Fedele says should be installed.
“It is surprising that the lieutenant governor doesn’t understand our current pension plan,” said Matthew O’Connor, a spokesman for the Hartford-based Connecticut State Employees Association, SEIU Local 2001. “But his comments are not so surprising, considering where he is in the polls. It’s clear that what the lieutenant governor would rather do is pit public-sector workers against private-sector workers. All that does is continue boosting the already wealthy on Wall Street because it lets them get away with a free pass from paying their fair share by saying switching everyone to a 401 (k) is a panacea to solve all our problems. It would definitely help the hedge-funders on Wall Street, but it wouldn’t help anybody else.”
Referring to Foley’s plans for cutting $1 billion in the state budget, O’Connor added, “He’s trying to one-up Tom Foley. … If you’re proposing the wrong prescription for the wrong problem, it doesn’t matter how detailed it is. The fundamental problem is what he and Foley are not doing, which is talking about how to improve this economy.”
Besides Fedele and Foley, the Republicans in the race are former U.S. Rep. Larry DeNardis of Hamden, longtime business executive Oz Griebel of Simsbury, Newington Mayor Jeff Wright, Danbury Mayor Mark Boughton, and Chester First Selectman Thomas E. Marsh.