Hamden To Meet Over Pension Bonds Tonight

This is an archived article and the information in the article may be outdated. Please look at the time stamp on the story to see when it was last updated.

Hamden’s neglected public employee pension fund is at about 14 percent of where it should be.

So tonight, there will be a public meeting at the Miller Library to discuss using pension obligation bonds, to take out high interest loans, to plug shortfalls in their employee pension funds. However, this method does not always work out.

If the pension funds make smart investments with the borrowed money, the returns can help pay the interest due to borrowers and sometimes even spin off some extra cash to pay pension costs.

If they don’t, the bonds can create additional costs for taxpayers, put the retirement funds in jeopardy, and even force municipalities into bankruptcy,

Market Watch columnist Robert Powell writes that municipal workers and retirees in the motor city, which has an underfunded pension liability of some $3.5 billion, face the possibility that their pensions could be reduced drastically, perhaps even by 50 percent or more.

Hamden’s Mayor Scott Jackson says the town’s plan includes a pension obligation fund infusion of about $125 million.

If approved by Hamden’s legislative council on July 29, Hamden’s taxpayers would be on the hook for a tax hike of roughly $150 per year for six years.

According to a Pew Center report, Connecticut is among the worst offenders of underfunding, with public pensions funded at under 55 percent in 2010.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s