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Pension payments driving latest budget challenges, state budget director says

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Folders with the label Retirement Plan and Pension

HARTFORD — Gov. Dan Malloy’s budget director is warning Connecticut lawmakers that the next two-year state budget faces “significant pressure” from slowing revenues and looming payments for unfunded pension liabilities and other old debt.

Ben Barnes, secretary of the Office of Policy and Management, appeared Wednesday before the General Assembly’s budget-writing committees to discuss the state’s fiscal situation. The budget that begins July 1 is projected to be about $1.3 billion in deficit.

Barnes acknowledges the Democratic administration is “aggressively ramping up payments against long-term liabilities” in order to fix years of underfunded teacher and state employee pension payments. Also, the state is poised to make a final $178.7 million payment for money it borrowed to balance the budget in 2009.

Malloy is expected to unveil his proposed budget in February.