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Vt. treasurer presents pension-cutting plan to lawmakers

Published: Jan. 28, 2021 at 5:49 PM EST
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MONTPELIER, Vt. (WCAX) - Vermont lawmakers Thursday heard from the state treasurer about proposed cuts to teacher and state employee retirement benefits aimed at keeping the state’s pension and retirement health plans intact.

Vermont’s unfunded pension liabilities stand at about $3 billion and it increased by $600 million this past year. This issue has been a long time coming. People are living longer, health care costs are rising, and the pandemic has driven more people into retirement.

To stabilize the fund, Vermont Treasurer Beth Pearce is recommending that the state reduce cost-of-living adjustments for retired state employees and eliminating them for retired teachers. She says an alternative would be for lawmakers to add $96 million to the fund annually. “For me, the ultimate goal is to make sure everyone has a defined benefit plan, has retirement security and that we have a system that is sustainable not just for this generation but for future generations,” Pearce said.

Pearce also hopes that help could come from the federal government if Congress passes a new stimulus package

Lawmakers were slated to hear from the unions representing teachers and state workers Thursday but ran out of time. The unions have balked at the proposal saying the state should institute a tax on the highest-earning Vermonters to fill the hole.

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