State budget tapping towns: Teacher pensions out, car tax changes still in
Towns appear to be off the hook —for now, anyway — on paying teacher pensions long considered a state responsibility, First Selectman Rudy Marconi said, but a state takeover of local car taxes is still under discussion in Hartford.
The Education Committee had stripped from the proposed state budget a section requiring local municipalities to begin paying the “normal” or running current costs of teacher retirements, Marconi said Tuesday, April 2.
“That cost was being introduced over a three-year period that would have cost Ridgefield $470,000 the first year, $970,000 in fiscal year 2020-21 and $1.4 million in fiscal year 2021-22,” he said.
“Major concerns were: one, that the municipality was not given any authority for negotiating, to make structural changes to the retirement plan; and, two, there was no cap on the amount to be incurred by the municipality,” he said.
While relieved to see the pension costs for towns appear to be removed from the state budget this year, Marconi expects the state’s teacher pension obligations will return as an issue.
“I think that a municipality some day will be part of the solution,” he said. “But if that’s the case, we need to be part of the negotiations at the table.”
The governor’s budget does include a plan for paying off past teacher pension obligations run up by the state.
“The governor has, in the bill, allocated some of the lottery money to cover some of the debt service on the bond issue to help cover the deficit in the teacher retirement plan,” Marconi said.
Some fiscal changes being discussed in Hartford still worry Marconi, however.
“The most drastic would be the sweeping of the car taxes by the state,” he said.
Among the goals of the state takeover is to make car taxes more similar from town to town — they now vary with local mill rates that reflect widely differing real estate values.
But Marconi views the initiative as a money grab, as well.
“It would help some local taxpayers, but could have an extremely detrimental impact on our revenue,” Marconi said, “an amount of approximately $8 million per year.”
And that would hit Ridgefield taxpayers.
“We’d have to make that money up somewhere,” Marconi said.