After multiple meetings spanning several months, a legislature-formed Vermont panel tasked with digging into potential solutions for tackling the state’s ongoing public sector pension debt dilemma could bring forward recommendations at the next scheduled session.
At the most recent meeting on Dec. 9, members of the Vermont Pension Benefits, Design and Funding Task Force continued discussing possible short- and long-term scenarios for the state’s four public employee groups.
Vermont is lumbering over a $5 billion debt tab that comes due in 2038. The state has been under a payment plan, which officials say historically has consumed about 10% of the annual general fund budget.
During the recent lengthy meeting, the task force delved into several issues, including a revisiting of past scenarios, process and procedural issues and a few new topics that generated concern from some of the panelists.
Chris Rupe, of the state’s Joint Fiscal Office, had previously presented the task force with scenarios that were modeled through forecasting.
In one scenario, the state would make a one-time $75 million contribution, in addition to a recurring, dedicated $15 million revenue source in the annual state budget. The other scenario calls for a one-time $50 million contribution and recurring $40 million revenue source.
Task force member Eric Davis, a teacher and representative of the profession’s state retirement board, said he was pleased with the modeling outcome.
“For every dollar invested in one-time funds through the amortization schedule, almost two dollars of savings is achieved,” Davis said. “It seems to me there is a good return on investment in those dollars.”
Rupe and others who spoke to the task force at the Dec. 9 meeting indicated there are still some lingering pieces of information, including additional actuarial data, which is forthcoming and could shape some of the group’s ultimate recommendations.
To date, the task force has hosted one formal public hearing, but several panelists indicated a desire to bring additional testimony to the table.
“I’ve been a big advocate for a second public hearing,” said task force member Andrew Emrich of the Vermont National Education Association. “I’ve been thinking about it, with the limited amount of time we have.”
State Rep. Sarah Copeland Hanzas, D-Bradford, said the additional hearing could be held under the auspices of a legislative oversight committee with the understanding robust testimony be sought.
One of the new topics that was broached at the most recent task force meeting is how any of the group’s recommendations – and any ultimate legislation – should impact new hires within one of the four labor groups.
Davis said he was concerned with the timing of the question, given a looming deadline for a final report.
“We’re getting into the eleventh hour of our work here,” Davis said. “If the task force is going to make such a recommendation, it has to fully consider and weigh the variants of that recommendation. I wouldn’t want to make it lightly.”
Copeland Hanzas, in response said, “I, for one, have no intention of making any kind of recommendation of what should happen for new hires because we haven’t taken enough testimony at all to know what the options are.”
The task force’s next meeting is scheduled for 9 a.m. Wednesday. If final recommendations are not reached at the meeting, an additional, special session could be called. Monday, Dec. 20 was tentatively penciled in as a potential date for such a meeting if it is necessary.
The task force has been directed to complete its report of recommendations in the coming weeks before the legislature reconvenes next year.