Hartford Business Journal

20 Hartford Business Journal • January 30, 2017 www.HartfordBusiness.com OPINION & COMMENTARY EDITORIAL City heads in right direction on pension shift W e know there are no silver bullets to solving the city of Hartford's fiscal crisis, but we applaud Mayor Luke Bronin and the city council for taking a small, if not symbolic, step to rein in long-term costs. Last week, the city council gave Bronin and city Treasurer Adam Cloud permission to devise a plan that would require new, nonunion city employees to join a 401(k)-type retirement plan rather than a more costly defined-benefit plan. The move away from traditional pensions to a defined-contribution model has been occurring in the private sector for years as employers make efforts to rein in costs, and it is reasonable to expect the public sector to finally follow suit. Hartford is currently spending $41 million in annual pension contributions, and that number, along with other long-term debts, is expected to rise in the years ahead. With the city facing a $22.6 million deficit this fiscal year, and a $50 million shortfall next fiscal year, all options to curb short- and long-term costs must be on the table and acted upon, particularly if Hartford officials want extra financial support from the state. Bronin, of course, has been attending town hall meetings in nearby suburbs to gar- ner regional support for a bailout of the city, which faces the prospects of bankruptcy if it doesn't receive added state funding. In nearly all towns he's visited, Bronin has faced some criticism and skepticism from residents who feel Hartford alone is responsible for its fiscal quagmire, and is undeserving of added support. Other residents wanted to see greater progress in the city reining in its costs. Moving to a 401(k) plan is a step in the right direction. An analysis still needs to be done to determine how much cost savings the transition would yield. To be clear, it won't have a dramatic effect because it will only impact newly hired, nonunion employees, who make up only a sliver of the city's 1,300-person workforce. This should only be the first step. Forcing all city employees, including union members, to move away from pensions to a defined-contribution plan must be the ultimate goal. Liberal members of the city council unsurprisingly raised red flags about the move, arguing city employees shouldn't have to suffer as a result of the city's fiscal crisis. They argue pensions offer more reliable retirement security. That may be true, but the city can no longer afford to give away generous benefits that seemed reasonable in good fiscal times. State must follow suit As the city begins to move away from pensions, we urge the state to follow suit. To his credit, Gov. Dannel P. Malloy has aggressively tried to deal with the state's own pen- sion crisis. Last week, the Appropriations Committee approved a plan that would allow Connecticut to defer billions of dollars in required contributions to the state employees pension fund until after 2032. The move would prevent annual pension payments from reaching unaffordable lev- els — as high $6.5 billion by 2032. It also means the state will prolong the agony of pay- ing off pension debt well into the future, saddling future generations with the burden. But more must be done to actually rein in costs, not just push them to a later date. Malloy and the legislature must demand benefit concessions from state labor unions. Republicans have suggested removing overtime earnings from the pension calcula- tion and requiring employees to contribute 4 percent of their pay toward their benefits. Those are reasonable demands in these difficult fiscal times. n LETTERS TO THE EDITOR Telephone Consumer Protection Act leads to frivolous lawsuits Dear Editor: Your recent piece ("CT attorneys, businesses seek legal payday with junk faxes," Jan. 9) highlights the importance of the Telephone Consumer Protection Act (TCPA), but misses key elements of the legal epi- demic surrounding this outdated law. The TCPA was enacted in 1991 to stop aggressive cold-call telemarketing. Unfortunately, TCPA lawsuits are much more than "a growing niche in the consumer legal field." In October of 2015, the Federal Communications Commission (FCC) issued a rule that made it easier for the plaintiffs' bar to argue modern technologies, such as smart phones, are considered "autodialers" under the statute. Congress certainly didn't consider this when they wrote the law, considering smart phones weren't invented until 2007. The FCC rule increased the number of abusive TCPA lawsuits. In 2015, there were 3,710 TCPA lawsuits filed in federal court — a 940 percent increase in five years. Consumers do not benefit from TCPA lawsuits, nor do small Connecticut firms. It's the plaintiffs' lawyers, who rake in millions of dollars in settlement fees in class-action cases. One survey of federal TCPA set- tlements found that in 2014, the average attorneys' fees awarded in TCPA class settlements was $2.4 million, while the average class member's award in these same actions was $4.12. The TCPA is far from a "legal payday" for companies, except for companies who are plaintiffs' law firms. Lisa A. Rickard President, U.S. Chamber Institute for Legal Reform 1615 H Street, NW Washington DC 20062 LRickard@USChamber.com Wind is an important part of Vermont's future Dear Editor: Brian Dubie says he knows how Vermont com- munities feel about wind power in his Jan. 9 com- mentary ("Hey Connecticut, Vermont ridgelines, meadows are not for sale"). But I'm a Vermonter, and I couldn't disagree more with his conclusions. I'd also like to set the record straight on many of the misconceptions in his piece. Hundreds of thousands of people live near wind farms around the world without experiencing health issues. Over 20 peer-reviewed studies have found no evidence of harm from proximity to wind turbines. Credible research from MIT, the Massachusetts De- partment of Public Health, the Wisconsin Department of Public Health, and Canada's equivalent of the De- partment of Health and Human Services all come to the same conclusion — wind energy is safe. Not only is it not a health risk, wind actually cre- ates enormous public health benefits. In 2015 wind caused $7.3 billion in public health benefits by cut- ting pollution that would otherwise create unhealthy smog and trigger asthma attacks. It's also totally inaccurate that wind companies receive upfront cash grants. Wind's primary incen- tive is a production-based tax credit, meaning com- panies only get credits if their projects are generat- ing electricity. I support wind energy because it creates a clean- er environment — Mr. Dubie fails to recognize that air pollution doesn't respect state borders. Wind also increases Vermont's tax revenue and attracts private investment into our economy. This helps keep taxes low and provides resources to better schools and fix roads. A lot of Vermonters support wind for good reason, despite Mr. Dubie's claims. Tom Gray Former executive director (1981-1989) and director of communications (1994-2010) of the American Wind Energy Association HARTFORDBUSINESS.COM POLL What should be President Trump's No. 1 priority? ● Repealing/replacing Obamacare ● Tax reform ● Trade reform ● Immigration reform ● Other To vote, go online to HartfordBusiness.com. Last week's poll results: Does your company require some employees to sign noncompete clauses? 64.8% Yes 35.5% No OTHER VOICES Trump will be a joke, not a threat By Chris Powell T he only thing funnier than the Trump administration's hostility to news organi- zations is the indignation of those organi- zations about it. For while news organizations are as imperfect as the Trump administration is, as long as liberty survives in the United States, the truth will prevail eventually, even when news organizations themselves are against it. If the new administration's communications team continues to be so clumsy and stupid, the public will wise up to it soon enough. First the new administration picked a fight with news organi- zations over the size of the crowd at the president's inauguration. Photographs showed the crowd to be much smaller than the one at President Obama's first inaugura- tion. While this might have been expected, since the weather on Trump's day was poor, a presidential spokes- woman insisted that the administration's claim that Trump's crowd was bigger was supported by "alternative facts," whatever those are. Then the same spokeswoman declared that, contrary to Trump's assurances during the cam- paign, he never will disclose his tax return, even upon completion of the audit he has said is under- way. A few hours passed and the spokeswoman took it back; she said the tax return issue remains under review. But then it was time to retract Trump's campaign pledge to move the U.S. Embassy in Israel to Jeru- salem. This issue now is said to be under reconsideration too. At this rate it may take less than a month for the administration to become less a threat to the news media than an international joke. n Chris Powell is managing editor of the Journal Inquirer. Chris Powell

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