House Approves Restructure of Municipal Retirement System

Rep. Maria Horn, D-Salisbury, during a House debate on June 6, 2023 Credit: Hugh McQuaid / CTNewsJunkie

The House voted Tuesday to approve a proposal by the state comptroller to restructure an ailing state-run retirement system for municipal workers in 107 Connecticut towns and cities. 

The plan, negotiated by Comptroller Sean Scanlon and announced last month, promises to save municipalities more than $30 million in the next fiscal year. The House sent the bill to the Senate on a bipartisan, 120 – 24 vote in the early afternoon. 


During a short floor debate, Rep. Maria Horn, a Salisbury Democrat who co-chairs the legislature’s Finance, Revenue and Bonding Committee, painted a dire picture of the current state of the Connecticut Municipal Employees Retirement System.”

“It serves many, many people in the state of Connecticut and it is in some significant trouble,” Horn said. “The funded ratio is down to 74%, costs to employers have risen over 600% since 2001 and over 75% in the past five years.”

The plan is the product of talks between the comptroller’s office, municipal executives and leaders of labor unions representing their workers. Scanlon has estimated it could save towns as much as $843 million over about three decades. 

Much of the expected savings are tied to changes in when cost-of-living adjustments are paid out and how they are calculated to reflect the impact of inflation and the performance of investments. 

The proposal phases out a current automatic 2.5% COLA adjustment and ties future increases more directly to the rate of inflation with the expectation of saving money during years when inflation is low. 

“To me, in general terms, what that means is this new system would more closely reflect the costs that retirees are actually facing in the marketplace,” Horn said. 

The plan also includes incentives for retirement-eligible employees to continue working and re-amortizes the pension debt from 17 to 25 years.

“The solution in front of us brought together a lot of different constituencies and the hope is that it will help save the system, which will provide stable retirement plans to so many in the state of Connecticut,” she said. 

The bill received significant support from the chamber’s Republican members, including Rep. Holly Cheeseman of East Lyme, the ranking member on the finance panel. Cheeseman said the retirement system, known as CMERS, required a course correction.

“Absent this kind of action, our municipalities would face crippling costs for these employee pensions,” she said. “We want to do something to fix this retirement system.”

That support was not unanimous, however. Rep. Tim Ackert, R-Coventry, cited opposition from the Connecticut chapter of the National Association of Housing and Redevelopment Officials. Ackert said the association worried that the restructured retirement plan would not be as attractive to potential hires as earlier terms. 

“They have grave concerns with this legislation,” Ackert said. “Many of their employees fall under this retirement program and they have been left out of the conversation.”

Horn, who conferred with members of the comptroller’s staff, said the office had met “for hours,” with the group. “Definitely, they were part of the conversation.”

The bill, which has the support of the governor and legislative leaders on both sides of the aisle, will now head to the Senate for consideration. It must be acted on by the legislative session’s statutory deadline of Wednesday at midnight in order to go into effect.