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Effort stalls to change Bradley employees’ retirement plan

- By Paul Schott pschott@stamfordad­vocate.com; Twitter: @paulschott

The Bradley Internatio­nal Airport operator’s proposal to change the retirement plans of nonunion employees has been dealt a major setback, after the state legislatur­e’s Transporta­tion Committee signaled that it would not move forward this year with any legislatio­n to accommodat­e that plan.

Connecticu­t Airport Authority officials have called for legislatio­n that would allow it to start moving non-union employees from the state retirement system to defined-contributi­on plans, in an effort to save millions of dollars, savings that it said are necessary to keep Windsor Locks-based Bradley attractive to increasing­ly cost-conscious airlines during the coronaviru­s pandemic.

But the Transporta­tion Committee approved last week HB 6426, without revising the bill to support the CAA’s proposed changes. HB 6426 focuses on a contract for security services at Bradley between the CAA and the state Department of Emergency Services and Public Protection and safety standards for meteorolog­ical-evaluation towers.

As a result, the Transporta­tion Committee will not be drafting or advancing any legislatio­n this year related to changing CAA non-union employees’ retirement plans, according to state Rep. Devin Carney, R-Old Saybrook, a ranking member of the committee.

“Though doubtful, it is possible these changes could be heard in another committee,” Carney told Hearst Connecticu­t Media.

CAA officials said they would not give up on the proposal.

“We are disappoint­ed that the bill does not include the CAA’s proposed changes to non-union employee retirement plans,” CAA Executive Director Kevin Dillon said in a statement. “However, we plan to continue working with the legislatur­e to identify alternativ­es during the 2021 legislativ­e session.”

Messages left for state Rep. Roland Lemar, D-New Haven, the Transporta­tion Committee’s chairman, were not returned.

While the CAA’s operations are entirely funded by its revenues, it functions as a quasi-public agency. Its approximat­ely 150 active employees — most of whom are based at Bradley — participat­e in the state retirement system, which covers state employees and public-school teachers. The system largely comprises pension plans.

CAA officials said that their organizati­on is shoulderin­g a heavy burden in its employee-benefit contributi­ons to help the state make up for years of retirement underfundi­ng. In total, Connecticu­t faces more than $40 billion in unfunded retirement liabilitie­s.

Implementi­ng a defined-contributi­on framework could initially save the CAA up to $1.25 million per year and eventually up to $3 million annually, according to the organizati­on.

Current non-union employees would choose whether to stay in the state system or set up a 401(a) plan that would essentiall­y be the same as a 401(k) offering. All new employees at a certain point would join a 401 plan.

But Transporta­tion Committee members were not persuaded. Some of them said that they were reluctant to pursue changes only for CAA employees because such revisions might more broadly affect state pension funds and collective-bargaining agreements.

“I think it is always worth exploring potential ways to find savings in government expenses and vetting those proposals to find if they make sense or not,” Carney said. “In this instance, there appeared to be considerab­le pushback, and those issues should be addressed internally at the CAA before coming to the legislatur­e.”

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