in the State House of Representatives
on April 22, 2021, by a vote of
Purpose: To create a Pension Benefits, Design, and Funding Task Force to oversee Vermont’s troubled pension systems and change the duties of the Vermont Pension Investment Commission.
Analysis: Vermont’s three state funded pension systems have a combined unfunded liability of $5.8 billion and rising. Recognizing the problem is a small step in the right direction, but is still well short of decisive action.
Under H.449, the Treasurer’s office oversight of the Vermont Pension Investment Commission will end, giving the Commission more independence. New members on the Commission will need to demonstrate financial expertise and training to be appointed. The Commission will continue managing the investments of the three funds: state employees, teachers, and municipal employees. It will also continue setting inflation, investment rate of return, and the valuation of asset assumptions.
The Pension Benefits, Design, and Funding Task Force will “review and report on the benefits, design, and funding” of the retirement benefit plans for current and retired teachers and employees. The 10 members are as follows:
- One member elected by the Board of the Vermont State Employees’ Retirement System (employees’ pension)
- One member elected by the State Teachers’ Retirement System of Vermont (teachers' pension)
- One member appointed by the Vermont School Boards Association (teachers’ pension)
- One member elected by the Board of the Vermont Municipal Employees’ Retirement System (municipal pension)
- One member appointed by the Executive Director of the Vermont League of Cities and Towns (municipal pension)
- The State Treasurer
- The Commissioner of Financial Regulation
- Two members appointed by the Governor who are financial experts
- One member, appointed by the other members
Those voting YES believe that bringing more financial expertise onto the Investment Committee and making it less political in nature, and creating Task Force to examine possible long-term solutions are a critical first steps in the short-term for fixing the unfunded liability crisis.
Most of those voting NO supported creating a task force to improve the pension situation, but were opposed to the makeup of the body for not having enough representation by labor interests. Others voting NO believe action needed to be taken now before more liabilities are accrued, and this is just a way of kicking the can down the road.
As Recorded in the House Journal, Thursday, April 22, 2021: "The Clerk proceeded to call the roll and the question, Shall the bill be read a third time?, was decided in the affirmative. Yeas, 125. Nays, 22." (Read the Journal, p. 708 – 710)
Watch the floor debate on YouTube.
State Retirement Plans Need a Robust Stress-Test — NOW! - David Coates
How They Voted
(Click on your Rep’s name to send an email)
Sally Achey (R - Middletown Springs) – YES
William Lippert (D – Hinesburg) – YES
Curtis McCormack (D – Burlington) – YES
Kirk White (P/D - Bethel) – YES
Rebecca White (D – Hartford) – YES
Dane Whitman (D - Bennington) – YES
Terri Lynn Williams (R - Granby) – YES
Theresa Wood (D – Waterbury) – YES
David Yacovone (D – Morristown) – YES
Michael Yantachka (D – Charlotte) – YES