Carter wrong to condemn state employees for veterans' financial woes - Steven Curran - The News Times 07-February-2012 State Rep. Dan Carter is way off base in condemning unions for the plight of state war veterans. (The News-Times, Feb. 1) We didn't cause the economic downturn. Much of that credit goes to the Wall Street bankers and hedge fund managers who stole our money and our retirements. Nevertheless state employees agreed last year to a $1.6 billion concession agreement with the Malloy administration. That's on top of a nearly $750 million concession agreement we reached in 2009 with the Rell administration. As part of last year's concession agreement, we accepted two years of wage freezes and we're paying more for our health care and our retirement. That might seem like chump change to the Romney-Gingrich crowd, but it's a big deal to those of us who are solidly middle class and play by the rules. Rep. Carter should thank us for stepping up to the plate in a way no one else did -- certainly not the big corporations or the extremely wealthy citizens. I'm disappointed that Rep. Carter is taking a page out of the tired Republican playbook and blaming public sector workers for service cuts that we've long opposed. However, I agree with Rep. Carter on one thing: Veterans are near to my heart, too. That's why our American Federation of State, County and Municipal Employees (AFSCME) union adopted the State Veterans Home in Rocky Hill nine years ago. We've raised more than $500,000 to directly improve living conditions and facilities for state veterans, including a new gym, a baseball field, outdoor furniture, a computer lab, flat screen televisions and more. Our commitment to state veterans has not only raised public awareness, but also helped to leverage state funding to modernize the Rocky Hill facility. Every year, on the Saturday before Memorial Day, the unions of Council 4 host a picnic at the Rocky Hill veterans home to thank the veterans for their service to country. This initiative was launched by state correctional union members. It's an event the residents eagerly anticipate; one veteran told us our picnic is the "welcome home" he never got after serving in Vietnam. I am extraordinarily proud of our union members for their commitment to state veterans. In that spirit I personally invite Rep. Carter to join me and my fellow union members at the Council 4 Veterans Picnic on May 28. Steven Curran is a state correction officer at Garner Correctional Institution in Newtown and member of AFSCME Local 1565.

Why is Obama now supporting 'super PACs'? - By David Grant, DCDecoder 07-February-2012 You might say President Obama was against "super PAC" fundraising before he was for it. From the very beginning, Mr. Obama castigated the US Supreme Court’s decision in Citizens United (read the court’s opinion, Citizens United v. Federal Election Commission) less than a week after it was handed down. In his January 2010 State of the Union message, Obama said thus: "Last week, the Supreme Court reversed a century of law to open the floodgates for special interests – including foreign companies – to spend without limit in our elections. Well, I don’t think American elections should be bankrolled by America’s most powerful interests, and worse, by foreign entities. They should be decided by the American people, and that’s why I’m urging Democrats and Republicans to pass a bill that helps to right this wrong." That ticked Justice Samuel Alito off something fierce – he was caught mouthing “not true” after the president’s 2010 State of the Union remarks – has joined Justice Clarence Thomas and Justice Antonin Scalia in abstaining from attending the State of the Union since that time. So fast forward to late Monday night, when news broke that Obama, in the words of POLITICO, offered a “reluctant blessing” for his campaign to raise money for the main – but flagging – Democratic super PAC, "Priorities USA." (Why do we say flagging? Because Priorities raised $4.2 million in 2011 versus an astounding $51 million for its GOP rival, "American Crossroads," and nearly $18 million for a pro-Romney super PAC. More on Crossroads shortly.) Well, there’s no such thing as a “reluctant blessing.” Either it’s blessed or it’s not. And the Obama campaign, according to The New York Times, has given its blessing to super PAC fundraising – even if they keep a smattering of fig leaves affixed to a few sensitive spots. To wit: "Aides said the president had signed off on a plan to dispatch cabinet officials, senior advisers at the White House, and top campaign staff members to deliver speeches on behalf of Mr. Obama at fund-raising events for Priorities USA Action, the leading Democratic 'super PAC'…. Neither the president, Vice President Joseph R. Biden Jr., nor their wives will attend fund-raising events or solicit donations for the Democratic group. A handful of officials from the administration and the campaign will appear on behalf of Mr. Obama, aides said, but will not directly ask for money." What’s the rationale for the turn? Crossroads and Mitt Romney’s super PAC, "Restore our Future," are on a roll. After extolling the president’s willingness to overturn the Supreme Court’s decision, even his willingness to go so far as a constitutional amendment, Obama’s campaign manager Jim Messina noted in a blog post that: "this cycle, our campaign has to face the reality of the law as it currently stands. Over the last few months, Super PACs affiliated with Republican presidential candidates have spent more than $40 million on television and radio, almost all of it for negative ads. Last week, filings showed that the Super PAC affiliated with Mitt Romney’s campaign raised $30 million in 2011 from fewer than 200 contributors, most of them from the financial sector. Governor Romney personally helped raise money for this group, which is run by some of his closest allies. Meanwhile, other Super PACs established for the sole purpose of defeating the President – along with 'nonprofits' that also aren’t required to disclose the sources of their funding – have raised more than $50 million. In the aggregate, these groups are expected to spend half a billion dollars, above and beyond what the Republican nominee and party are expected to commit to try to defeat the President. With so much at stake, we can’t allow for two sets of rules in this election whereby the Republican nominee is the beneficiary of unlimited spending and Democrats unilaterally disarm." Besides calling the Obama campaign’s decision a “cynical course reversal,” Crossroads pointed reporters toward an October 2010 NYT piece detailing Obama’s harsh criticism of super PACs. In short, Obama argues that super PACs are a threat to American democracy as we know it. "You can’t let it happen," Obama told thousands of supporters gathered at a school park in a predominantly African-American, working-class neighborhood in northern Philadelphia. "Don’t let them hijack your agenda. The American people deserve to know who’s trying to sway their elections, and you can’t stand by and let the special interests drown out the voices of the American people...." "You don’t know," he said here. “It could be the oil industry, it could be the insurance industry, it could even be foreign-owned corporations. You don’t know because they don’t have to disclose. Now that’s not just a threat to Democrats, that’s a threat to our democracy." And while Democrats are trying to get into the game, that more recent New York Times article raises another tough question for the Obama team: After decrying super PACs for so long, will their moneymen (and ladies) rush to prop up Priorities USA? As a top adviser to George Soros, one of the left’s wealthiest benefactors, put it: “It takes either a very sophisticated or very cynical person to decry the nefarious influence of money on politics and then turn around and write a check for $5 million to influence elections.” Or even more bitingly, as one top Democratic fundraiser recently told a top Priorities USA official, per POLITICO: “Is this what we’ve become?”

Malloy likely to keep plenty of state jobs vacant - By Keith M. Phaneuf - The CT Mirror 07-February-2012 Whatever new initiatives Gov. Dannel P. Malloy unveils Wednesday in his revised budget for the next fiscal year, he likely won't be asking for much extra staffing to carry them out. Forced to rely more heavily than expected on retirements and other vacancies to control labor costs in his first year, the governor currently oversees a work force that's about 14 percent smaller than his predecessor managed three years ago. And with the administration needing to find more savings just to keep current spending in balance, Malloy's budget chief concedes that any broad expansion of hiring across most agencies is unlikely. Benjamin Barnes "We're just trying to adjust the authorized position count to reflect reality," Office of Policy and Management Secretary Benjamin Barnes said last week, adding that while "critical vacancies in public safety and health care" will be addressed, "there's no question it's going to be a challenge for some agencies to function effectively." Malloy, who took office in January 2011, inherited a state work force that -- according to critics in labor and the legislature -- has been weakened considerably by too many retirement incentive programs over the past two decades. These have been a popular choice among prior governors and legislatures to cut personnel costs -- in the short term -- during tough fiscal times, having been offered five times between 1989 and 2009. A sixth would have been made available in 2010 had state union leaders accepted a proposal from then-Gov. M. Jodi Rell. According to records from the comptroller's office, retirements since 1989 have averaged 1,080 workers in years without incentives, and 4,285 in years with them. The 2009 retirements, which totaled more than 4,700, took a particularly heavy toll, Barnes said. "I don't think there was a serious effort in the last administration to realign (the work force) after the 2009 retirements," he said. Some agencies still argue they are short far too many workers. Sen. Toni N. Harp, D-New Haven, co-chairwoman of the Appropriations Committee, said she's particularly worried about the Department of Social Services, which has 8 percent fewer workers since January 2009, despite a growing demand for benefits in tough economic times. "This didn't just happen overnight, and it's gotten worse over time," she said. "I'm beyond concerned about that." Malloy warned shortly after he took office last year that he wouldn't offer new incentives to spur more retirements. Critics of these incentive programs note that they have helped to weaken a cash-starved state employee pension program. That's because as more workers retire sooner than expected, they stop paying into the pension system and start drawing benefits out of it. Still, the concessions deal the governor struck with unions still pushed retirements in 2011 well above the level of a typical year without an incentive program. Though no incentives were paid to encourage retirements, the concessions deal did impose several new restrictions on retirement benefits starting in October 2011. If there was no incentive for senior workers to retire, there was a disincentive for many to stick around after the fall. Nearly 2,700 workers retired between January and October 2011. As of January, the administration reported 38,957 full-time positions filled across all departments and agencies, down from 45,223 in January 2009 -- four months before the last retirement incentive program was approved. Staffing for the community-technical colleges, the Connecticut State Universities and the University of Connecticut isn't included in that report, but its positions have declined on a similar track over the past three years. And while many departments and agencies hoped to begin refilling many of those positions in 2012-13, the administration has had some recent struggles that could restrict further hiring. Nonpartisan legislative analysts were reporting a $145 million deficit in the general fund, which covers the bulk of operating costs in this year's $20.14 billion budget. Barnes' office says finances remain in the black by a mere $1.4 million. And the preliminary $20.4 billion budget adopted last June for 2012-13 originally was designed with a nearly $500 million surplus in the general fund, and $555 million across the entire budget. Those projected fiscal cushions have since been cut in half, due largely to shrinking estimates for tax revenues. Not surprisingly, Malloy is still talking about shrinking state government. The governor announced plans on Jan. 27 for a second round of agency consolidations, folding 15 departments, agencies or offices into seven. "Last year we began the work of changing how the state does business -- making government smaller, less costly and easier to navigate," Malloy said. "Like companies and families across the state and the country, state government must do more with less." The governor and legislature agreed on a plan last spring for a net reduction of 22 departments and agencies, from 81 to 59. Technically, the new budget removed 27 entities via consolidation, but it also created five new ones, eliminating a net total of nearly 70 positions at that time. Malloy said there would be relatively little in terms of position cuts, and budgetary savings, in this second round of mergers. That's largely due to a provision in the concession deal. In exchange for a two-year wage freeze, new restrictions on health care and retirement benefits, and savings from other changes, the administration agreed to exempt most bargaining units from layoffs for four fiscal years, through 2014-15. Sen. Robert Kane of Watertown, the ranking Republican on the Appropriations Committee, said that granting the no-layoff clause was a mistake, but one Malloy can offset partially by trying to eliminate more non-union, administrative posts across state government. "In my mind I think we need to go further," Kane said. "We need to narrow that bureaucracy, and that (concessions) deal really painted us into a corner."

Mayor: “State Of The City” Hinges On Schools - by Paul Bass & Melissa Bailey - New Haven Independent 07-February-2012 Another 20 walking cops. A new “one-stop” city-run “jobs pipeline.” Mayor John DeStefano unveiled those new plans in his annual State of the City address Monday night. But he spent more time reaffirming—and re-selling—an existing top priority: New Haven’s school-reform drive. The mayor delivered his 45-minute address to an overflow crowd of some 200 people crammed into City Hall’s aldermanic chambers. Scroll down in the story to read a detailed play-by-play account and analysis of the speech interspersed with comments from Independent readers. (Then feel free to keep the conversation going by posting new comments in the regular comments sections.) DeStefano focused on four main areas in his speech: school reform, public safety, job creation, and city finances. But from the start he made it clear school reform remains his top priority as he proceeds with his record 10th two-year term in office. It was the first substantive subject of his talk. It was also the coda. He did unveil a few initiatives, like adding those new walking beats on top of the 20 just instituted in town, and using city government to tie job-seekers and training programs to actual jobs available at existing employers in town. He also officially revealed this plan for a new vo-tech school launched in conjunction with Gateway Community College. (More details are included in the play-by-play account, including how those proposals fit in with efforts by the new Board of Aldermen to take the lead on those same issues.) But the more striking aspect of DeStefano’s speech was what wasn’t new. He sought to convince people to stick with school reform as it enters its next phase. And to convince people it is the most important civic enterprise of the moment. “It would be the great failure of our moment and our time if we did not follow through with school reform,” the mayor declared. “We need to keep doing what we’re doing in school change. This is not quick, easy or cheap. It is like most things in our lives that are worthwhile. It requires persistence ... Showing up and showing up ...” Aldermanic President Jorge Perez welcomed the message. “I’m very happy to see the emphasis on education,” Perez said. “If we’re ever truly going to address poverty” on the local, state and federal level, “education is the answer.” He agreed with DeStefano that the city needs to “institutionalize school reform,” so that it isn’t just a temporary effort. DeStefano’s immediate intended audience consisted of the 30 members of the Board of Aldermen arrayed immediately before him. Nineteen of those aldermen are new to the job. A clear majority ran for office against candidates, and an agenda, linked to DeStefano’s City Hall. He needs them on board. Hill Alderwoman Jackie James, who was part of the coalition that overthrew DeStefano’s allies on the board in the fall elections, called the mayor’s speech “excellent.” “The board and the mayor are kind of speaking the same language about what needs to happen in the city,” James said. If that continues to happen, she said, “we’re going to be able to accomplish a lot this year.” DeStefano challenged aldermen to take part in school reform. “Visit every elementary school in your district” as well as some citywide high schools, he asked the aldermen. The mayor recounted his visit last week to a mayors’ school-reform conference at the Gates Foundation in Seattle. He noted that in other cities, school reform seems to consist mainly of starting charter schools. Only in New Haven does it consist of a wide range of experiments, he said, such as turnaround schools, high-stakes teacher evaluations, administrator evaluations, “Promise” college scholarships, detailed school-by-school metrics, some charter involvement, extra money and rule flexibility for high-performing schools, and reconstituting failing schools. To that list the mayor promised to add two new projects this coming year: the vo-tech program formed in partnership with Gateway Community College; and a “Parents University” modeled on a Boston institution. “One thing that we forget is that many of these parents we want to get involved are the products of the almost 2 decades of failed schools,” community activist Kevin Ewing remarked in the real-time Independent discussion. “It is unlikely that they will come to a school for a ‘Parents University.’” For the complete discussion and account of the speech, the full play-by-play discussion follows. The Independent hosted it along with Angi Carter of the New Haven Register and Neena Satija of WNPR. West River community activist Kevin Ewing also sat in throughout. New Haven Independent State Of The City Discussion Monday February, 6, 2012 6:38 p.m. Paul Bass:: Hi everybody. A crowd’s gathering—this event always seems to generate a buzz of excitement, a sense of new possibilities at the beginning of a new year. (And a break from people attacking each other.) Look for lots of talk tonight about school reform, crime, school reform, jobs, school reform, public finances, and school reform. 6:50 Kevin Ewing: Hey folks, what do you think will NOT be covered in tonight’s address 6:52: Angi Carter: Hi Kevin and Paul, Angi Carter here. It’s standing room only in the aldermanic chamber at City Hall. 6:52 Paul Bass: Among the crowd (it’s packed): Police Chief Dean Esserman, police union President Arpad Tolnay, West River organizer Stacey Spell, union organizer Gwen Mills, Fire Chief Michael Grant, economic development official Mike PIscitelli, recently retired LCI neighborhood worker Elaine Braffman, Cedar Hill Resident, former Quinnipiac Meadows Alderman Gerald Antunes, former Alderwoman (and candidate for town chairwoman) Esther Armmand, former East Rock Alderman Dick Lyons, top cops Ray Hassett and Leo Bombalicki ... Also a bevy of top-rated teachers ... (You may be hearing about them later.) 6:53 Marko Pavela: Thanks for having us, Paul! 6:58 Angi Carter: Meeting should be starting shortly. Mayor’s address will precede rest of the Board of Aldermen’s agenda. 7:01 Kevin Ewing: Wonder how many Alders are there for the start of their meeting. It looks pretty full on the video feed. 7:01 Paul Bass: This speech comes at a time when two groups that competed for votes last fall are now in a friendlier competition—to come up with good ideas for linking New Haven people to jobs. The Board of Aldermen—with a new labor-backed majority—is planning to pass a resolution tonight to draw up a “jobs pipelines” plan within 90 days. Look for the mayor, meanwhile, to address the issue, too, in his address, as his did in his inaugural address last month. There may even be a new idea or two. 7:02 Paul Bass: They’re taking roll right now Kevin. I don’t see anyone absent. 7:03 Kevin Ewing: Cool. Couldn’t hear the roll call. 7:04 Paul Bass: Newhallville Alderwoman Brenda Foskey-Cyrus is doing the “divine guidance.” “We appreciate what people do. We affirm who they are. ... “ 7:05 Paul Bass: Two rows behind the aldermen is a row of blue uniforms and caps: the police department’s district managers, along with the chief and patrol chief Lt. Luiz Casanova. In front of them sits Kathy DeStefano. The mayor is about to get an “escort” of aldermen to usher him to the lectern. 7:05 Angi Carter: Mayor’s Committee of Escort is leaving the chamber to return with Mayor John DeStefano Jr. 7:05 Comment From Streever Thanks for doing this, Paul & Kevin—very appreciated! 7:06 Angi Carter: Voters,contractors, former aldermen, former city workers and DeStefano’s rival in the mayoral race Jeffrey Kerekes packed the chamber 7:06 Paul Bass: I’m guessing 150 people here, maybe more. Jam packed. 7:06 Neena Satija: Jeff Kerekes standing at the front of the crowd in the back. (Kerekes garnered 45 percent of the vote in the last mayoral election, running as an independent.) 7:07 Angi Carter: City school children here, too 7:08 Kevin Ewing: Is that Jorge joking about the delay? 7:08 Angi Carter: Mayor heading in, crowd gives him an ovation 7:08 Paul Bass: MIA: The Governor’s Foot Guard .... 7:08 Neena Satija: I’d say a lot more than 150—maybe at least 200 here tonight. 7:09 Kevin Ewing: The Mayor really looks like he enjoys doing these. 7:10 Angi Carter: DeStefano opens with story about community pulling together during storm Irene 7:10 Comment From Matt Ugh, I hate seeing kids used as props. Has the text of the speech been released to the media already? 7:10 Paul Bass: Mayor John DeStefano is starting his remarks now. He’s beginning as usual by recognizing some people as local heroes as well as some institutions: workers and volunteers from Hurricane Irene; firefighters and neighbors who helped families “left homeless from a January fire”; and the new Whalley Stop & Shop and Elm City Market, where most of the employees live here in New Haven. 7:11 Angi Carter: DeStefano giving shout outs to fire fighters, public works and other responders 7:12 Angi Carter: crowd applauds 7:12 Neena Satija: Getting pretty crowded onstage there. 7:12 Paul Bass: “After spending the better part of winter in the EOC, it was no fun” doing it again “in August,” the mayor says. EOC is the Emergency Operations Center. He’s noting that we had several monster storms this year. I think we’re entering an era where mayors will be focusing more and more on weather emergencies, because of global warming; and governors will become more like mayors, dealing with the technical minute-to-minute details of storm response. 7:12 Kevin Ewing: Those folks should be getting standing ovations for their work. 7:13 Paul Bass: Matt, in past years advance copies of the whole speech were released. This year it was being written in final form toward nightfall. We do have a summary outline. 7:13 Comment From Kathy no time for standing ovations for anyone else. They were rushed off back to their seats. 7:14 Angi Carter: “the neighborhood, not the city, not the Red Cross, the neighborhood” raised funds for displaced families and pets, DeStefano says 7:14 Paul Bass: People think it’s corny to do these clap-for-local-people intros. So what? It’s sweet—worst thing that happens is that someone who saved people in a fire get extra applause and a little honor. 7:15 Comment From Steve is he using up his time to avoid actual issues? 7:15 Paul Bass: Steve—there’s not a set amount of time allotted. So he can’t “use it up.” 7:15 Kevin Ewing: Okay those dog comments weren’t necessary at the end. 7:16 Angi Carter: mayor moving to commentary on two supermarkets opening in New Haven last year - they made commitments to hire city residents - markets were Stop & Shop and Elm City Market 7:17 Neena Satija: DeStefano’s talking up the new businesses in New Haven this year. There sure are a lot of them—from the supermarkets to that great new bakery Katalina’s on Whitney, to the smoothie place on Audobon, to Insomnia cookies… 7:17 Angi Carter: mayor says he will touch on ‘four big things we need to do’: starting with public school change for all our kids 7:18 Paul Bass: “Our most pressing challenge and opportunity”—school reform. DeStefano is repeating a theme from the past year: Lots of stuff is important. Nothing is more important than dramatic improvement in public education. Tonight he’s looking to get people on board with keeping up the experimentation launched in the past year. He has 19 new aldermen sitting in front of him. He needs them to agree. 7:18 Angi Carter: Here’s what change looks like as defined by the mayor: each school becomes a ‘high functioning organization’; close the achievement gap; cut the dropout rate; and provide the resources students need to finish college 7:19 Comment From ted What’s wrong with the American Flag? 7:19 Kevin Ewing: Isn’t a given that we need good public schools? Is this new? 7:20 Paul Bass: Mayor cites strivers in India. “We have no reason to fear this competition as long as we prepare for it. In New Haven, preparing for that competition means remaining faithful to” school reform. First part of that: “Portfolio schools.” Each school measured for how it’s doing; we “grow successful schools,” “reconstitute” failing schools. 7:20 Angi Carter: DeStefano says failing schools should be ‘reconstituted’ 7:20 Angi Carter: The district is in a second year of a new teacher evaluation system 7:21 Comment From Streever Kevin: Unfortunately, it is a new concept in New Haven. 7:21 Neena Satija: DeStefano’s urging for school reform comes just a couple weeks after the teacher’s union asked to slow the effort down. That came on the heels of news that none of the schools had gone up a tier since the school board placed all public schools in three tiers to kick off the school reform campaign. 7:21 Angi Carter: 5 of the lowest performing schools have a new staff over the past two years 7:22 Angi Carter: DeStefano uses this analogy: black cat, white cat - who cares as long as it catches mice 7:22 Paul Bass: Part 2 of his school reform pitch: Quality teachers and administrators. He’s leading with the teacher evaluation system the teachers union and administration came up with. We got a lot of national ink on that. The state’s about to copy the idea. We’re getting lots of credit for our ideas in New Haven. It’ll be interesting to see whether we can carry out these policies; that’s the big test, and he needs people behind him in that process. It’ll be interesting to see whether a more open environment develops in the schools so teachers and parents and students feel encouraged to add their voices; or whether, if that doesn’t happen, democracy proves essential to successful school change. 7:23 Paul Bass: Part 3 of the school reform overall approach: Promise to New Haven (college help for local kids who do well in school, in many cases a full tuition ride to state schools). Today UNH added to this by announcing it will give half to full tuition for ESUMS students who do well in school. 7:23 Kevin Ewing: I actually agree with most of the strategy for school change except that it leans a bit too much on punishment for those perceived not up to “standard” with way too much blame placed on teachers. 7:23 Angi Carter: Change will not be quick and easy to achieve, mayor says 7:23 Paul Bass: “We need to keep doing what we’re doing in school change. This is not quick, easy or cheap. It is like most things in our lives that are worthwhile It requires persistence ... Showing up and showing up ...” 7:23 Neena Satija: He just mentioned improvement in school climate—that is one of the few data points we have just a couple years into school reform that shows a significant gain, possibly as a result of the reform efforts. 7:24 Comment From scotto As much as people hated No child left behind..the Mayor would not be talking about teacher evaluations without it 7:24 Comment From Matt Neena—you say no school has moved up a tier. Do you have the criteria for moving up or down a tier? 7:24 Streever: What is the Mayor going to say in 5 years if the lowest performing schools—after multiple staff changes—still have the lowest performance? He is simplifying the complex issues around education, reform, and income inequality to a dangerously low level. 7:24 Paul Bass: The mayor’s citing a plan Melissa Bailey wrote about recently—a joint trades program with Gateway. 7:25 Paul Bass: Mayor asks the aldermen to do this: “Visit every elementary school in your district” and some high schools. 7:25 Neena Satija: Matt—you’d have to ask school reform czar Garth Harries that. The Board of Ed uses a variety of different criteria to tier the schools, from test scores to climate surveys to evaluations, I believe. It appears to be a pretty complex formula. 7:25 Angi Carter: Good point Kevin, reform has to target more players than teachers 7:26 Streever: While he points out the connection between the income gap and higher education, he gets the causal relationship completely wrong. While you could look at it from the end—as he does—and see that people with higher education earn more, it is far more illuminating to look at it from the other end, and see that people from higher income backgrounds tend to pursue higher degrees. 7:26 Neena Satija: Mayor seems to really be responding to teachers’ union president Dave Cicarella’s pleas that the reform effort slow down this year. 7:26 Kevin Ewing: One thing that we forget is that many of these parents we want to get involved are the products of the almost 2 decades of failed schools. It is unlikely that they will come to a school for a “Parent’s University.” 7:26 Angi Carter: mayor about to introduce best performing teachers and encourages the crowd to visit schools and get to know them by name 7:27 Paul Bass: DeStefano mentions the school reform conference with mayors that he just attended at the Gates Foundation in Seattle. he came back struck by how in other cities school reform meant just opening up charter schools; while policy-wise in New Haven it means a wide variety of ideas (turnaround schools, teacher evaluations, administrator evaluations, Promise, school-by-school metrics, some charter involvement, extra money and rule flexibility for high-performing schools, reconstitute failing schools). “It would be the great failure of our moment and our time if we did not follow through with school reform.” 7:27 Angi Carter about 23 teachers lined up at front of the chamber for recognition 7:28 Angi Carter: 2nd of four big jobs will be public safety 7:28 Kevin Ewing: So it looks like over half the folks in attendance are gonna be paraded up front. When I’m able to suppress my cynicism I think it’s pretty cool that they get recognition. 7:28 Angi Carter: referencing violence, DeStefano said we must never think it’s normal or that someone deserved it 7:29 Angi Carter: DeStefano points to two missions: focus on guns and violence behavior; and reinvigorate community partnerships 7:29 Paul Bass: Now DeStefano is moving to public safety. In this case, he is talking about moves he made in response to a bruising campaign season, where almost all his aldermanic candidates lost to labor-backed challengers in contested races. He picked up that people thought his policing strategy was failing. So he brought in a new chief, Dean Esserman, with a charge to bring back the community policing that has withered under DeStefano’s watch the past 18 years. Right now he’s saying that while he is a big supporter of Esserman, the more important issue is developing a broad strategy that will work, rather than relying on any one person. 7:30 Comment From CITYSAVIOR What happens to students who don’t go on to higher education. any votec training? 7:30 Comment From Kathy Why only first names of the best teachers. 7:30 Neena Satija: Moving on to crime: Mayor stresses transparency. That’s important after the sudden departure of former chief Frank Limon several months ago. The mayor insisted he was staying on—but the Independent reported that he’d emptied his office. Major point of controversy during the campaign. 7:30 Kevin Ewing: I’ve not done the research but I’m betting that most of the folks committing violence on our streets attended the NH public schools identified as failing in years past. 7:30 Comment From Kathy Ugh. Okay teachers, you’re done. So dismissing. 7:30 Angi Carter: 133 shootings last year, only 27 solved 7:31 Angi Carter: The police department is challenged not just by narcotics-related violence, but shootings and other incidents that stem from disputes 7:31 Paul Bass: Policing specifics: We’re bringing David Kennedy’s “High Point” strategy for fighting violence. We’re looking at doing more with cold cases. “Families haven’t give up on justice. And we can’t have murderers walking our streets.” He warns aldermen: I’ll be coming back with requests to change personnel rules, among other proposals, to deal with cold cases. (A reference to bringing detectives out of retirement maybe?) 7:31 Streever: I wish the Mayor will speak about the decision to allow Esserman to remove well-known and respected community police from the top positions, at an additional potential cost of 2 million plus. Velleca and Adger could have easily put in another decade—both loved their jobs and were loved by residents—but now they are retiring at 120k+ a year for the rest of their lives while Esserman brings in his new squad. 7:31 Neena Satija: The hiring of new officers will also be closely watched in the city—many residents say they want more officers who are actually from New Haven. 7:32 Kevin Ewing: One way to help with maintaining community relationships is to stop changing the chain of command in the department every couple years. Just when we start building relationships we have to start all over again. 7:32 Paul Bass: News: He now is saying he wants to double the number of walking beats to 40. Just last week the first 20 were added to the beat. DeStefano says the strategy will involve NOT spending new money to “pay for it all,” but changing the overall approach to policing with lots of changes within divisions. He says this proposed strategy will come before the board and there will be lots of discussion. Notice the olive branch—he now has a potential opposition majority on the board. He wants to be working with them, and taking a lead on policy, rather than fighting them. 7:32 Angi Carter: Police Chief Esserman wants to double walking beats to about 40 and increase the number of school resource officers; DeStefano admits he must sell the Board of Aldermen on those concepts and answer their questions on how they get funded; no details yet on the budget implications but the cost is expected to head upward 7:32 Comment From Rachel Paul, how does one turn off the annoying typing sound that interrupts the audio feed every time someone posts? 7:33 Streever: Rachel: there is a sound control at the bottom 7:33 Comment From Yaakov Community partnerships: I’ve already met the new walking beat cops in the Dwight neighborhood. Amazing guys. 7:33 Paul Bass: Thanks David! Way beyond my page grade. 7:33 Angi Carter: Mayor bringing up police department’s district managers 7:34 Neena Satija: This is a volatile time for the top tanks of NHPD, as Esserman just asked his three remaining assistant chiefs to leave and wants to pick his own team. 7:34 Paul Bass: Here comes the parade of district managers. They really are the front line accountable cops—in charge of neighborhood mini-police forces. They’re an enthusiastic bunch when it comes to dealing with citizens. They’re at that great stage where they haven’t been kicked upstairs and out of daily contact with the public, away from 1 Union Ave., but where they have a lot of ability to determine how policing takes place. 7:34 Kevin Ewing: I wonder how many of them will be at the next SOC address. 7:35 Angi Carter: Esserman has announced he wants to replace the three assistant police chiefs who were in place when he started last fall - there’s been backlash from the community about outsing Asst. Chief Petisia Adger 7:35 Comment From Yaakov Cops get last names, teachers don’t? 7:35 Comment From Guest Wow thanks all. My first time on this site and the directions and info on turing off the typing click was good. It works 7:36 Angi Carter: Now moving to matchups and mismatches between jobs and skills in New Haven 7:36 Streever: I’m glad to help guest! Thanks for being here. 7:36 Paul Bass: Now on to job creation—another area where the newly elected aldermanic majority brought in an agenda that the mayor is working hard either to get in front of or at least play a major role in. Alternatively, this seems to be the big issue on which the aldermen can assert themselves as true policymakers rather than reactors to the executive branch. 7:36 Paul Bass: The aldermen “set the table” and “should be proud of” doing so on this issue, DeStefano says. 7:37 Comment From scotto non-shout out to Yale 7:37 Comment From Patty Mc Wow thanks to all. watching and doing homework at the same time and the clicking was a bit much. Turned it off and all is good. 7:37 Angi Carter: Jobs will be a big thrust of the new Board of Aldermen, they will unveil their own plan; DeStefano is emphasizing city partnerships with employers 7:38 Paul Bass: DeStefano unveils a “one stop” “Employer Pipeline.” City government would find out what jobs are open at local employers. It would find out what skills people have who are looking for jobs. It would look at what training is needed. Then it would try to link people up. Interesting political subtext: The version of this emerging from the labor-oriented aldermen would put more teeth into agreements with developers of new projects. This focuses on already existing workplaces. 7:38 Comment From CITYSAVIOR all good cops but the street officers should have been acknowledged, the mayor already said the detectives could not solve shooting. The street officers are the foot solders 7:39 Angi Carter: quickly on to finances and the budget—Jeffrey Kerekes hammered the mayor on spending, questionable real estate deals and lack of enforcement on tax abatement plans with employers, some of whom have left the city, during the election last year 7:39 Kevin Ewing: Uh oh…. tread lightly Mr. Mayor… 7:40 Paul Bass: “Job Number Four”—finances, taxes, grand list, budget. He has some decent news: 2011 grand list grew 17 percent. Most of that is just from the reassessment of property. But 2.7 percent comes from new sources: PSEG’s peaking power plant and UI’s substation upgrades on Union and Grand Avenues. That adds $6 million a year in tax revenue to the city’s coffers. We grew last year, too, thanks to projects like 360 State. Years before it was the cancer hospital and related developments. Yes, we like all cities have budget challenges (especially when it comes to health care and pension costs). But we also have some financial advantages in this economy that other cities don’t have. 7:40 Neena Satija: Mayor quick to talk “new growth, not reval growth”—that’s because revals went up dramatically this year after being on hold for several years. A lot of residents weren’t happy to see their tax bills jump. 7:40 Paul Bass: Latest projection: 17th city budget surplus over the past 18 years. 7:41 Angi Carter: On taxes, the mayor says 2011 revaluation will have biggest impact - cites ‘wild disparities’ 7:41 Neena Satija: The increases in property tax were particularly bad in the East Rock neighborhood. 7:42 Streever: I’ve never seen a silver bullet for solving the budget with one or two easy cuts. What I do see are a number of small bad decisions that ultimately cost us all—decisions like forcing Adger to go. An Asst Chief who could have stayed on the force for another decade is now going at, what, $120k/ year pension for the rest of her life? I have a hard time taking him seriously on his promises to reign in the budget when I look at missteps like forcing Adger out. 7:42 Angi Carter: increases in property valuations were steeper than drops, mayor says 7:42 Kevin Ewing: He is really good at spouting out statistics and numbers. That always impresses me. 7:42 Streever: East Rock was absolutely hit the hardest—one of my neighbors saw his tax burden grow 4-6 times higher than his neighbors who live in almost identical homes on Canner street. 7:42 Comment From scotto Those pensions are just staggering 7:42 Paul Bass: Now comes property revaluation. That looks like it’ll be an earthquake in East Rock, but not much elsewhere (in general). Interesting stats the mayor offers: 46 percent of residential property owners saw values rise in the revaluation; 54 percent saw them drop. For owner-occupied residential property, 51 percent of properties rose in value, 49 percent dropped. That’s unusual—about half the city goes up, half goes down. The challenge: How not to whack East Rock senseless without enabling people in more struggling areas from benefiting from an overdue adjustment in their own tax rates. 7:44 Paul Bass: “Hard sets of choices” loom on the budget, DeStefano says. That’s an annual fact, not specific to this year. True nonetheless. He notes that nationally, jobs are back on the upswing int eh private sector. But government at all levels is shedding jobs. Meanwhile, many people will want more services in New Haven. 7:44 Angi Carter: DeStefano repeatedly cites health care costs and pensions as ‘budget drivers’ but leaves off debt from school construction 7:45 Paul Bass: Mayor says he will be submitting ideas to get the self-insurance fund under control. (We don’t have an insurance company for lawsuits. We, taxpayers, are the insurance company.) 7:45 Comment From scotto There is always revals to tax more but never revals on the pesions that the 7:45 Streever: Any thoughts on why he didn’t mention the long-term costs last year? (in an election year) 7:45 Kevin Ewing: I’ll admit that I’ve not paid much attention to the details of the budget but it seems we approach budget and taxes backwards. We figure out how much we can get and then spend it. What would happen if we figured out how much we need then collected it. 7:46 Paul Bass: The city’s about to get into serious contract negotiations with police and fire unions and two big AFSCME locals, DeStefano notes. It’ll be interesting to see how he and the firefighters negotiate requested pension and health givebacks after the union endorsed the mayor last fall. 7:46 Angi Carter: Mayor will not delay implementation of reval but will take a look at possible ways to ‘mitigate’ its effects on taxpayers…we need him to elaborate on that in a follow up discussion 7:46 Streever: Kevin: If you listen to most citizens complain about municipal services, I think the issue is that we don’t have enough money to do what we need to do. Of course, I feel that you are right—the city should be doing a much better job of proactively planning and thinking about the budget with an approach more like yours. 7:46 Angi Carter DeStefano circling back to school reform 7:47 Comment From CITYSAVIOR streever is Adger going to make 120k . I thought that jump was removed prior to her appointment? The police do not provide any protection for asst.chief. their at will so until that happens the door will be revolving . Now the mayor says the police and fire work heard but im coming after your benefits . what a joke 7:47 Neena Satija: Ends with school change—he’s really pleading now. School change has been embroiled with politics even more than usual lately during the investigation of grade tampering at Hillhouse, where the new principal Kermit Carolina alleges he’s only being investigated because he didn’t support the mayor during his re-election campaign. 7:48 Streever: CitySavior: I don’t know what her pension will be, but I suspect it will be solid—I hope she does do well, she is a great officer, and I’m sorry to see her go. 7:48 Paul Bass: Mayor is ending with a school change coda. He wants to make it clear that he considers school reform the biggest deal in New Haven. That involves a sell—school reform definitely took a back seat to public safety and job creation in last fall’s election. That’s a leader’s role in part—besides responding to grassroots demands, framing what he considers the big challenges, then convincing people to buy in. Whether DeStefano succeeds in that task with school reform will largely determine the success of this term—and a key part of his legacy. 7:49 Streever: The vast majority of speech tonight seemed to be on school change—I do think we need to drastically improve our school system, but I don’t think that focusing on teacher excellence is the real solution. I think focusing on increasing teacher coverage is a lot more important, and haven’t seen any proposals for that. 7:49 Streever: Have teachers gotten worse over the last 50 years, despite an increase in education for teachers, an increase in standards, in increase in qualifiers? It is certainly a more difficult job now than it once was. Has college gotten dramatically harder that kids need more from their teachers? 7:50 Paul Bass: DeStefano just ended. Speech longer than usual—it turns out that had as much to do with all the people he was recognizing and bringing up, I think. Over the next two months we get to hear a minority state of the city and ... wait, we’re supposed to hear a Republican state of the city address. But there are no elected Republicans this year! Stay tuned. 7:51 Kevin Ewing: I’d say overall that was a pretty good speech. I will continue to say that we can’t put ALL of our focus on schools and the kids that are in them now. We have to remember that the schools have been failing for a long time and we must continue to think about the generations that attended them. They’re in their 20s and 30s now and we never taught them the basics. 7:55 Comment From Yaakov Thanks for the coverage, Paul and Kevin.

Malloy turnaround plan for lowest-performing schools could hinge on union approval - By Jacqueline Rabe Thomas - The CT Mirror 07-February-2012 Unfazed by a looming state Supreme Court decision that could say the state overstepped when replacing Bridgeport's school board, the governor wants the state to intervene in up to 25 of the state's lowest-performing schools to turn them around. "We will not tolerate year after year the same schools being on the bottom of the pile," Gov. Dannel P. Malloy said Monday during his visit to a local Hartford school. But for those lower-rung schools, which have yet to be identified, the success of this initiative largely depends on getting the buy-in from the local teachers' union. "I am asking the legislature to give us the tools necessary to reorganize schools, pursuant to agreement that will be reached with those systems," Malloy said. "We are going to put a model in place to turn around our lowest-performing schools." Malloy is proposing that the state ante up $24.8 million to pay for things like longer school days, increased pay to attract high-quality teachers and paying for the health or nutritional needs many students aren't getting at these schools. Teacher pay varies significantly by a town's wealth, according to the state Department of Education, and few schools have embraced longer school days largely because of the costs. "We are stretched thin," said Christina Kishimoto, Hartford's superintendent, adding it's difficult to keep her best teachers. "Our neighbors are recruiting our teachers from under us." One major disincentive for local approval is the threat that teachers risk losing their jobs in these schools, a move that caused a huge uproar in Rhode Island. "Teachers who are currently employed at these schools may reapply for their position in the school," Malloy's proposal reads. A spokesman for the State Department of Education said the state may seek authority to make changes without traditional or formal local approval, but will work in consultation with the state's teachers' unions. Also, teachers who leave these schools may be eligible for open positions at other schools. "Discussions are ongoing regarding ways, when possible, to accommodate scenarios where no openings exist," Spokesman Mark Linabury wrote in an email. These schools will also pilot a new teacher tenure system, or "career ladder," linked to the new evaluation system set to be approved Friday by the State Board of Education. Current career ladders are often based on how long a teacher has worked for a district. Under the new system, students' performance would largely be the yardstick. Mary Loftus Levine, the leader of the state's largest teachers union, said she's not sure how easily local schools will sign on to this agreement and overrule their local collectively bargained contract. "It's premature to say now," she said, noting that having local autonomy on reforms will be key. "There's a lot of details that have to be worked out." Malloy said the answer should be simple for those responsible these low-performing schools, and has a very straightforward question for them. "Are you going to tolerate failing schools because of some prior agreement, or because of the way things were done in the past because it's easy not to take on the challenge of reform?" he asked. Linabury said the SDE is working with the unions and district leadership on the specifics so these interventions can take place. Looming decision The State Supreme Court heard arguments months ago on a case dealing with the State Board of Education's decision to take over the notoriously struggling Bridgeport school district. During that hearing, Justice Peter T. Zarella asked the fundamental question: when can the state legally intervene? "Is it just everybody's at risk and it's an arbitrary decision?" he asked. The justices were essentially told that there is no standard, but federal testing benchmarks were considered. Those against the takeover also say the state cannot interfere in matters that the state Constitution delegates to a local elected board. Because Malloy said he will work with all parties to reach agreement on reforms, Education Commissioner Stefan Pryor said he "doesn't see how that [pending decision] could impact this." But the plan lays out a much harsher scenario; either work with the State Department of Education in partnership to make the reforms, or the state "may exercise authority" to can take over governance temporarily. Kishimoto said that while she thinks two of her schools could likely be named as among the worst in the state, getting the approval from the teacher union will be essential. "We either get buy in and we work in partnership or we'll figure out how to move ahead another way," she said.

Malloy Looks To Transform Low Performing Schools - by Christine Stuart - CT News Junkie 07-February-2012 Since announcing 2012 would be the year for education reform Gov. Dannel P. Malloy set his sights on the state’s lowest performing school districts. That’s where he wants to focus the state’s resources. There are about 30 districts which fall into this category and they educate about 41 percent of the state’s children, Malloy said Monday at a press conference at SAND Elementary School in Hartford. “This is not just an issue of education it gets to the core of our effort to promote economic development. We must prepare our students for the jobs of tomorrow,” Malloy said. “The key to taking on this challenge is to take on the elephant in the room, our state’s low performing schools.” In order to solve the problem Malloy proposes setting up a Commissioner’s Network where low performing schools would voluntarily participate and allow the state to take over their schools or help them partner with universities or other regional education centers to implement turnaround interventions. Malloy proposes using nearly $25 million to transform 25 schools over the next two years. “We will not tolerate, year after year, the same schools being on the bottom of the pile,” Malloy said. But just how far is he willing to take his ideas about change? Malloy admitted that the proposal has the potential to change current collective bargaining agreements, but those changes would likely be minor in nature and would come with additional compensation for teachers who may be asked to lengthen the school day. Malloy argued there’s no teacher that wants to go to a failing school. “To some extent we need to hold up a mirror and have everyone look in it and say, ‘are you going to tolerate failing schools because of some prior agreement?’” Malloy said. He said his proposal doesn’t necessarily mean collective bargaining agreements would need to be changed, but he expressed confidence that teachers would support whatever is needed to bring about change. “We know what works we just lack the will to implement it,” Malloy said. Hartford Schools Superintendent Christina Kishimoto said she welcomed Malloy’s proposal Monday and would gladly participate in the program. “For five years we’ve been asking the state department to intervene. To either partner with us or to look at taking over our crisis schools,” Kishimoto said. “We get the same funding in our crisis school as we get for our highest performing school, and so we can not turn around a school that’s in crisis alone.” But it’s not only a stick approach. The package also includes rewards for schools that improve their performance over a three year period. Those schools will receive grant awards and be asked to partner with other low performing schools to share their successes. Malloy said these steps will help support the state’s effort to qualify for a waiver from federal requirements under the No Child Left Behind Act. The State Department of Education plans on applying for this waiver on Feb. 21. The state will also launch a $300,000 pilot program to prepare students to read proficiently by grade three. The proposal comes hours after Malloy announced Monday that he was increasing funding for charter school students, a proposal that was met with skepticism by some who worry about how local school districts will be able to find the additional $1,000 per pupil to pay for it. “We find it noteworthy that the governor wants to divert precious local education dollars to promote local district charter schools—an undertaking that cities and towns have not embraced to date under the weight of increased local demands and diminished resources,” Mary Loftus Levine, executive director of the Connecticut Education Association, said Monday. “As a member of the state ECS Task Force, I express sincere caution at the governor’s proposal to take funding from already strapped neighborhood schools and direct it to new charter schools,” she added. Asked about how he plans on funding all the proposals he’s put forth and how each would fit into the Education Cost Sharing formula, Malloy said, “stay tuned.” “It’s a comprehensive package. It’s going to make people uncomfortable. It’s going to point out deficiencies,” Malloy said of his overall education package which he’s been rolling out over the past week. Malloy will unveil one more piece of his education puzzle at noon Tuesday.

East Haven police staffing issues could grow; 5 senior officers eligible for retirement June 30 - By Mark Zaretsky - The New Haven Register 07-February-2012 EAST HAVEN — Depending on what happens with police contract negotiations until June 30, the Police Department’s growing staffing crisis could get even worse, regardless of whether it loses additional officers to indictment. That’s because five senior officers will be eligible to retire by the end of the fiscal year June 30, or soon thereafter, and they’re worried that if they don’t leave before a new contract takes effect on that date, they might lose medical benefits, police sources said. The department already was down several officers from its 53-member full strength before Sgt. John Miller and Officers Dennis Spaulding, David Cari and Jason Zullo were indicted and arrested Jan. 24 as a result of a federal grand jury investigation into alleged mistreatment of Latinos. All four officers pleaded not guilty and are out on bail and paid administrative leave. Two or three officers retired a few months before the arrests, sources said. Police Chief Leonard Gallo, who Mayor Joseph Maturo Jr. brought back Nov. 29 after 19 months on paid administrative leave, retired in the wake of the arrests, effective Friday. Gallo had returned less than two weeks after Maturo, a Republican, took over from Democrat Mayor April Capone after winning election in November. Federal officials have said the investigation is continuing, and two former town officials who previously dealt with the FBI have said that additional arrests are likely. The five officers who will be eligible for retirement by June 30 or shortly thereafter include Sgts. Bruce Scobie, George Cammerer and Gary DePalma, Detective Daniel Gilhuly and Officer Michael Sorbo, sources said. DePalma won’t be eligible to retire until August, they said. Continued... 123See Full Story What will happen if some or all five officers retire and additional officers are arrested? No one can or would say exactly. But Friday, Maturo vowed, “I will make sure that the town of East Haven will be protected.” Assistant Director of Administration and Management Frank Gentilesco said that police would have plenty of lead time to make decisions before any new contract was signed, which might not necessarily be by June 30. “They have the ability to retire as long as the old contract is still alive,” he said. “We haven’t begun to have even our first negotiating meeting yet,” he said. Deputy Police Chief John Mannion, who is running the department until Maturo hires a new chief, declined to comment, although he previously has said that if the department loses up to five people, “we can do certain things” internally. Maturo has barred Mannion, the department’s spokesman and a former commander of the state police Central District Major Crime Squad, from discussing issues related to the federal investigation. But Mannion, who was hired by Capone while Gallo was on leave, has previously discussed the department’s contingency plans. If the department loses six to 10 officers, there likely will be a “reconfiguration of the staffing and the schedule, and we might have to implement a plan that goes, instead of three eight-hour shifts, to two 12-hour shifts,” Mannion has said. Continued... 123See Full Story The department might also “take some of the people who are in administrative plainclothes shifts ... and bring them back in an emergency basis, put them back in uniform,” Mannion has said. Another possibility is greater use of supernumeraries, many of whom are retired police officers, including “three or four” who are still certified, he has said. One idea that was being discussed at the time in the event that the department lost more than just a few officers was the possibility of state police participation in town policing, former Capone administration official Paul Hongo Jr. has said. East Haven also has gone through the civil service process to put together a list of certified police officers from other communities who might be interested in coming to East Haven to work, town officials have said. Eight sworn officers are on that list. The Capone administration also investigated the possibility of moving to civilian dispatchers — an idea Maturo’s administration won the right to do in a 2007 contract — which would put one more officer on the street. Maturo said Friday that “that’s possible,” and Gentilesco said the administration already has the right to do so under the current contract. The previous administration also considered moving plainclothes detectives and administrators, such as the chief and deputy chief, out on the street as supervisors as well, and the possibility of moving from the current four days on, two days off schedule to a five days on, two days off schedule, Hongo has said.

Malloy commits $300 million to state public housing - By Mark Pazniokas - The CT Mirror 03-February-2012 Gov. Dannel P. Malloy will make a 10-year, $330 million commitment to affordable housing in the budget he is proposing next week, with much of the money devoted to the rehabilitation of long-neglected, state-financed public housing. The program calls for spending $30 million a year in state bonding over the next decade, a sum that housing experts say could be easily doubled by leveraging tax-sheltered private equity. "On behalf of all the advocates, can I just say, 'Whoo hoo!' " said Betsy Crum, the executive director of the Connecticut Housing Coalition, one of the housing advocates at Malloy's announcement Wednesday evening in Hartford. Connecticut, one of only four states with state-financed public housing projects, has underfunded maintenance of those projects for the past 20 years. An estimated 10 percent of its 14,000 apartments are badly deteriorated or uninhabitable. Dara Kovel, the chief housing officer for the Connecticut Housing Finance Authority, said many vacant units need to be gutted and totally renovated. Some buildings are too damaged to be saved, she said. At Westbrook Village and Bowles Park, two adjacent low-rise projects in Hartford, about half the 770 units are vacant. At Vidal Court in Stamford, half the bleak mid-rise is dilapidated, while half has been demolished and rebuilt. Malloy announced his program in a conference room at The Lyceum in Hartford, where he says he participated in many housing strategy sessions as mayor of Stamford. A regular topic: How to save the state public housing. "I promised myself if I was ever in a position to do something about it, I would," Malloy said. Last year, Malloy committed $130 million in bonding for housing, mainly for gap financing to allow the construction of affordable housing. "It didn't go high enough last year. That's what we're acknowledging," Malloy said. Malloy said the state-financed public housing - the majority of public housing in the U.S. is built and maintained with federal funds - has not been adequately funded since the last years of the administration of Gov. William A. O'Neill, who left office in 1991. "From that time on, the programs basically died a slow death," he said. "I have got to play catch up, quite frankly." Aside from the bonding commitment for public housing, his new proposal would provide $12.5 million for elderly congregate housing, $20 million for affordable housing options and $1.5 million for scattered-site, supportive housing. Malloy said there has not been new state funding for elderly congregate housing in 11 years. The governor also is proposing a reorganization that would combine housing programs in the Department of Economic and Community Development. Programs now are shared by DECD and the Department of Social Services. The governor said the investments would provide clean, safe housing and give a boost to the construction industry, creating more than 6,000 jobs over two years. "Every dollar spent on affordable housing generates multiple times that amount in private economic activity," Malloy said. Malloy's initiatives are not always preceded by outreach efforts to the legislature, but this one clearly had been: House Speaker Christopher G. Donovan, D-Meriden, attended the announcement, and a laudatory comment from Senate Minority Leader John McKinney, R-Fairfield, was included in the press packet. "As a strong advocate for affordable and supportive housing, I applaud Gov. Malloy for the progress he has made on these issues and for giving attention to this important cause," McKinney said. "I look forward to working with him on this initiative in the upcoming legislative session." On Tuesday, Donovan's proposal to increase the hourly minimum wage by $1.50 over the next two years drew a lukewarm response from Malloy. But the speaker and governor were in sync Wednesday on housing. "Boy, this is great news," said Donovan, who said that previous governors did not have the will to address affordable housing. "He understands it. He gets it." Sen. Ed Gomes, D-Bridgeport, co-chairman of the legislature's Housing Committee, said the news conference was one of his first public appearances since his hospitalization four months ago. He said he had to thank the governor. "We're just so elated," said Gomes, who has been recuperating at home. "If there was anything that got me off my butt, it was this."

S.E.C. Is Avoiding Tough Sanctions for Large Banks - By EDWARD WYATT - The New York Times 03-February-2012 WASHINGTON — Even as the Securities and Exchange Commission has stepped up its investigations of Wall Street in the last decade, the agency has repeatedly allowed the biggest firms to avoid punishments specifically meant to apply to fraud cases. By granting exemptions to laws and regulations that act as a deterrent to securities fraud, the S.E.C. has let financial giants like JPMorganChase, Goldman Sachs and Bank of America continue to have advantages reserved for the most dependable companies, making it easier for them to raise money from investors, for example, and to avoid liability from lawsuits if their financial forecasts turn out to be wrong. An analysis by The New York Times of S.E.C. investigations over the last decade found nearly 350 instances where the agency has given big Wall Street institutions and other financial companies a pass on those or other sanctions. Those instances also include waivers permitting firms to underwrite certain stock and bond sales and manage mutual fund portfolios. JPMorganChase, for example, has settled six fraud cases in the last 13 years, including one with a $228 million settlement last summer, but it has obtained at least 22 waivers, in part by arguing that it has “a strong record of compliance with securities laws.” Bank of America and Merrill Lynch, which merged in 2009, have settled 15 fraud cases and received at least 39 waivers. Only about a dozen companies — Dell, General Electric and United Rentals among them — have felt the full force of the law after issuing misleading information about their businesses. Citigroup was the only major Wall Street bank among them. In 11 years, it settled six fraud cases and received 25 waivers before it lost most of its privileges in 2010. By granting those waivers, the S.E.C. allowed Wall Street firms to have powerful advantages, securities experts and former regulators say. The institutions remained protected under the Private Securities Litigation Reform Act of 1995, which makes it easier to avoid class-action shareholder lawsuits. And the companies continue to use rules that let them instantly raise money publicly, without waiting weeks for government approvals. Without the waivers, the companies could not move as quickly as rivals that had not settled fraud charges to sell stocks or bonds when market conditions were most favorable. Other waivers allowed Wall Street firms that had settled fraud or lesser charges to continue managing mutual funds and to help small, private companies raise money from investors — two types of business from which they otherwise would be excluded. “The ramifications of losing those exemptions are enormous to these firms,” David S. Ruder, a former S.E.C. chairman, said in an interview. Without the waivers, agreeing to settle charges of securities fraud “might have vast repercussions affecting the ability of a firm to continue to stay in business,” he said. S.E.C. officials say that they grant the waivers to keep stock and bond markets open to companies with legitimate capital-raising needs. Ensuring such access is as important to its mission as protecting investors, regulators said. The agency usually revokes the privileges when a case involves false or misleading statements about a company’s own business. It does not do so when the commission has charged a Wall Street firm with lying about, say, a specific mortgage security that it created and is selling to investors, a charge Goldman Sachs settled in 2010. Different parts of the company — corporate officers versus a sales force, for example — are responsible for different types of statements, officials say. “The purpose of taking away this simplified path to capital is to protect investors, not to punish a company,” said Meredith B. Cross, the S.E.C.’s corporation finance director, referring to the fast-track offering privilege. “You’re not seeing the times that waivers aren’t being granted, because the companies don’t ask when they know the answer will be no.” Others, however, argue that the pattern is another example of the government being too soft on Wall Street as it has become a much larger part of the economy in recent decades. President Obama, in his State of the Union address, asked Congress last week for tougher laws that make “the penalties for fraud count.” Federal judges in New York and Wisconsin recently criticized the S.E.C. for its habit of settling cases by allowing companies to promise not to violate the law in the future. The commission has frequently turned the other cheek when the companies again settle similar fraud cases. S.E.C. officials have defended that practice by saying they do not have the resources to take cases to court rather than settle. They recently asked Congress to toughen laws and to raise financial penalties for fraud violations. But the repeated granting of waivers suggests that the agency does in fact have tools it often does not use, critics say. Close to half of the waivers went to repeat offenders — Wall Street firms that had settled previous fraud charges by agreeing never again to violate the very laws that the S.E.C. was now saying that they had broken. Senator Charles E. Grassley, an Iowa Republican who serves on committees that oversee the S.E.C., said he was baffled that the agency had recently asked Congress for more enforcement powers when it had ceded much of the power it already had. “It’s really hard to see why the S.E.C. isn’t using all of its weapons to deter fraud,” he said. “It makes already weak punishment even weaker by waiving the regulations that impose significant consequences on the companies that settle fraud charges. No wonder recidivism is such a problem.” The Times analysis found 11 instances where companies that had settled fraud cases had actually lost the special privilege for fast-track stock or bond offerings, versus 49 times that the S.E.C. granted waivers from the punishment to Wall Street firms since 2005. The analysis counted 91 waivers since 2000 granting immunity from lawsuits, and 204 waivers related to raising money for small companies and managing mutual funds. The S.E.C. does not maintain a central database of how many companies lose special status or are denied waivers. Its records of granted waivers are scattered across several databases on its Web site. JPMorganChase is among the big Wall Street firms that have been granted multiple waivers with nearly every settlement of S.E.C. fraud charges. Last July, it agreed to pay $228 million to settle civil and criminal charges that it cheated cities and towns by rigging bids with other Wall Street firms to invest the money raised by several municipalities for capital projects. JPMorgan received three waivers related to that case for privileges that it otherwise would have lost. But the S.E.C. said the company’s fraudulent actions didn’t involve misleading investors about JPMorgan’s business. “That distinction doesn’t do it for me,” said Richard W. Painter, a corporate law professor at the University of Minnesota and the co-author of a casebook on securities litigation and enforcement. “If a company has trouble telling the truth to investors in one batch of securities it is underwriting, I would not have confidence that it would tell the truth to investors about its own securities.” Despite six securities fraud settlements in 13 years, JPMorgan rarely if ever lost any special privileges. It has been awarded at least 22 waivers since 2003, with most of its S.E.C. settlements generating two or more. In seeking the reprieves, lawyers for JPMorgan stated in letters to the S.E.C. that it should grant a waiver because the company has “a strong record of compliance with the securities laws.” The company declined to comment for this article. Citigroup is one of the rare Wall Street giants that has lost significant privileges recently. In October 2010, the bank paid $75 million to settle charges that it misled investors in 2007 about the size of its holdings of assets backed by subprime mortgages. The company told investors that it had about $13 billion of those risky investments on its balance sheet, when it really had more than $50 billion, according to the S.E.C. Because those accusations involved Citigroup’s statements about its own financial well-being, the company lost for three years the ability to insulate itself from lawsuits over mistaken predictions about its business. It also lost, for the same three years, the exemption for “well-known seasoned issuers,” which allowed it to quickly raise capital in the securities markets. As a result, Citigroup has had to file thousands of pages of new documents with the S.E.C. and wait weeks for the agency’s approvals to make itself eligible to sell stocks, bonds and other securities to the public. Citigroup declined to comment on whether the sanctions have had any effect on its business. Wrangling over waivers is an important part of the negotiations when companies accused of fraud discuss a settlement with the S.E.C., and sometimes it can involve a form of corporate plea bargaining to a lesser charge. In 2009, the S.E.C. was negotiating with Bank of America over charges that it had failed to disclose to shareholders that billions of dollars in bonuses were being paid to Merrill Lynch executives just as Bank of America was bailing out the firm. Because the S.E.C. charges involved fraudulent statements by both Bank of America and Merrill Lynch about their financial status, the merged company was in danger of losing its special privileges for both offerings and forecasts. According to a report by the then-S.E.C. inspector general, H. David Kotz, the waiver issue “was of such importance to B. of A. that the settlement became contingent on B. of A.’s receipt of the waiver.” Bank of America apparently won the argument but would not comment on it. It settled the case by agreeing to a $150 million payment. The S.E.C., however, decided not to charge the bank with fraud, which could have endangered the bank’s special status. Instead, the S.E.C. charged Bank of America with violating disclosure rules for shareholder materials and proxies, and Bank of America kept its privileges. S.E.C. officials said they would not discuss how they arrived at specific settlements and declined to comment on the Citigroup, JP Morgan or Bank of America settlements. Thomas Lee Hazen, a securities law professor at the University of North Carolina at Chapel Hill, said that it is understandable that the S.E.C. might relax some potential sanctions on Wall Street firms — where it appears that lessons have been learned, or when a fine is thought to be sufficient punishment. “The ripple effect of having a sanction that could shut them down or could seriously impede a company’s operations would seriously affect a lot of innocent customers,” he said. “It’s a very fine balance. That’s not to say that the S.E.C. is striking the balance properly. That is in the eye of the beholder.”

Brooklyn Worker Dispute Seen as Test of Obama’s Labor Board Appointments - By William McQuillen - Bloomberg 03-February-2012 A dispute over working conditions at a Brooklyn apartment complex may be a test case for whether President Barack Obama’s appointments to the National Labor Relations Board are legal. Lawyers for the Flatbush Gardens apartments, including Paul Clement, a solicitor general and acting attorney general for President George W. Bush now with the Washington law firm Bancroft PLLC, have asked a court to throw out the board’s complaint in the case. “The Board lacked a quorum and has no authority to file the petition because three of its putative members have not been validly appointed,” Clement alleges in the filing. Obama appointed three members to the board on Jan. 4 without seeking Senate confirmation, asserting that the chamber was in recess. A president is permitted to make appointments without confirmation during a recess, though Republicans dispute that was the case on Jan. 4. In response to the appointments, some lawmakers said they would intensify their investigation of the NLRB, which retained a Democratic majority, and Republican presidential candidate Newt Gingrich called for stripping funding from the board because of Obama’s move. NLRB Complaint “The administration strongly believes that the president’s exercise of his recess appointment authority -- authority expressly granted to him by the Constitution and exercised by all recent presidents -- is valid and will be upheld by the courts,” White House spokesman Eric Schultz said today in an e- mail. The Flatbush case was the subject of a hearing yesterday in U.S. District Court for the Eastern District of New York during which Judge Roslynn Mauskopf recused herself, citing personal reasons, Nancy Cleeland, an NLRB spokeswoman, said yesterday. The Service Employees International Union 32BJ is seeking an injunction to end a lockout of 70 of its members. The union complained that the workers were blocked from their jobs in November 2010 after they refused to accept a 30 percent cut in pay and benefits. The union is seeking an order reinstating its members at their prior wages and alleges the company improperly concealed $37 million in payments to shareholders during negotiations. ‘Legitimate Board’ The NLRB, which mediates labor disputes, filed the complaint in federal court on Jan. 25. The labor board started this year with two members, too few to make decisions or issue rulings. Obama then appointed Sharon Block, Richard Griffin and Terence Flynn. All had been nominated earlier, though the Senate hadn’t acted. “The chairman has said, from his perspective, this is a legitimate board and they are doing their job,” Cleeland said. In a separate lawsuit in Washington, trade groups, including the National Association of Manufacturers and the National Right to Work Legal Defense and Education Foundation Inc., today asked a federal judge to rule on the legality of the appointments, saying they were “invalid” and “threaten to harm” millions of employers and workers. The filing was related to a suit brought by the groups seeking to block a rule mandating companies notify workers of their rights to form a union. Flatbush Gardens said in its filings that the Senate never adjourned. The president doesn’t have the authority to decide when the Senate is in session, it says. ‘Fundamental Principles’ “Our Constitution’s most fundamental principles of separation of powers prohibit one branch from overriding the determinations of another about its own proceedings,” the Flatbush lawyers wrote in their filing. A Jan. 6 memo by the Justice Department concluded that a president can make recess appointments when lawmakers hold pro forma sessions without conducting business, such as on Jan. 4. “They were certainly in a formal way in session, though the administration will take the view that this was more or less fiction,” said Jesse Choper, a law professor at the University of California at Berkeley, who isn’t involved in the case. Challenges may continue until courts provide definitive guidance, Choper said in a telephone interview. If this case doesn’t serve as the test case, others will, he said. The NLRB claims that no matter what the courts say about the recess appointments, the complaint against the Brooklyn complex should not be thrown out. The NLRB’s general counsel also had agreed to bring a complaint, which is enough authority even without the board, Cleeland, the NLRB spokeswoman, said. “The employer is trying to raise this issue in the litigation,” said Matthew Nerzig, a spokesman for the union, said in an e-mail. “There are good reasons why the court does not need to consider the issue, but in the end it may do so.” The legal filing was previously reported by Crain’s New York Business. The cases are Paulsen v. Renaissance Equity Holdings LLC, 12cv350, U.S. District Court for the Eastern District of New York (Brooklyn), and National Association of Manufacturers v. National Labor Relations Board, 11-cv-01629, U.S. District Court, District of Columbia (Washington).

Indiana union leader promises no Super Bowl skirmish - WSBT 03-February-2012 INDIANAPOLIS (AP) — The president of Indiana AFL-CIO is promising union members will not disrupt the Super Bowl festivities in Indianapolis after efforts to block right-to-work legislation failed. Nancy Guyott said Thursday that organized labor will take its fight to the ballot box in November rather than Super Bowl celebrations in downtown Indianapolis this week. On Wednesday, Gov. Mitch Daniels made Indiana the 23rd state to ban labor contracts that require workers to pay union representation fees following grueling Statehouse battles and massive union protests. Union protesters had threatened work slowdowns and traffic jams as an estimated 150,000 tourists flood the city for the game Sunday. Protesters instead plan to hand out anti-right-to-work pamphlets in the Super Bowl village.

Unemployment Rate Drops to 8.3%; Payrolls Jump - By Bob Willis - Bloomberg 03-February-2012 The U.S. jobless rate unexpectedly fell in January to the lowest in three years as payrolls climbed more than forecast, casting doubt on the Federal Reserve’s plan to keep interest rates low until late 2014. The unemployment rate dropped to 8.3 percent, the lowest since February 2009, Labor Department figures showed today in Washington. The 243,000 increase in jobs was the biggest in nine months and exceeded the most optimistic forecast in a Bloomberg News survey. Service industries grew by the most in a year, according to a separate report. “We’ve reached an important threshold here,” said Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ Ltd. in New York. “The recovery is for real.” Stocks and bond yields jumped on optimism the economy will weather the European debt crisis as an improving labor market fuels household spending. The data, which showed gains from factories to retailers, may boost President Barack Obama’s re- election bid and come a week after Fed Chairman Ben S. Bernanke said unemployment would be slow to decline. The Standard & Poor’s 500 Index rose 1.5 percent to 1,344.90 at the close of trading in New York, extending the best start to a year since 1987. The index is up 6.9 percent in 2012. The yield on the benchmark 10-year Treasury note climbed to 1.92 percent from 1.82 percent late yesterday. Survey of Economists The median projection in the Bloomberg survey called for payrolls to rise by 140,000. Estimates of the 89 economists ranged from increases of 95,000 to 225,000. Revisions added a total of 60,000 jobs to payrolls in November and December. “The payroll gains we’re seeing in this report are consistent with significant improvement in consumer spending,” said Carl Riccadonna, a senior U.S. economist at Deutsche Bank Securities Inc. in New York. “If we hold at these levels, it will change a lot of expectations for economic growth, the labor market recovery, inflation and the Fed’s policy response.” Sustained increases of around 200,000 jobs a month are needed to bring the unemployment rate down one percentage point over a year, according to Stephen Stanley, chief economist at Pierpont Securities LLC in Stamford, Connecticut. Obama used today’s report to push lawmakers for an extension of the payroll-tax cut for workers and unemployment benefits. “The recovery is speeding up,” Obama said at a fire station in Arlington, Virginia. “And we’ve got to do everything in our power to keep it going.” European Sales Elsewhere, European retail sales unexpectedly declined in December, led by Germany and France, as unemployment at a 14- year high and government spending cuts sapped consumer demand. Gains in U.S. employment last month were broad-based, including manufacturing, construction, temporary help agencies, accounting firms, restaurants and retailers. Employment, overtime and hours worked in factories increased as manufacturers, who have been leading the two-year recovery, boosted production to rebuild inventories and meet global demand for their goods. Assembly-line workers put in an average 41.9 hours of work each week, the most since January 1998, while overtime hours climbed to the highest since March 2007. Manufacturing payrolls increased by 50,000 in January, the most in a year. Peoria, Illinois-based Caterpillar Inc. (CAT), the world’s biggest maker of earthmoving equipment, plans to hire more workers this year as it expands facilities, including in Victoria, Texas, and Winston-Salem, North Carolina, Chief Financial Officer Edward Rapp said yesterday. Employment Growth “Those are the things that will lead to employment growth here,” Rapp said in an interview with Betty Liu on Bloomberg Television’s “In the Loop.” The unemployment rate, derived from a separate survey of households, was forecast to stay at 8.5 percent, according to the survey median. The drop in the jobless rate reflected a 381,000 decrease in unemployment at the same time 250,000 Americans entered the labor force. Private payrolls, which exclude government agencies, rose 257,000 in January after a revised gain of 220,000 the prior month, marking the biggest back-to-back gain since March-April. It was projected to climb by 160,000. Employment at service-providers increased 162,000, the most in four months, reflecting faster job gains in retail, transportation and leisure and hospitality. Software Company Tibco Software Inc. (TIBX) plans to hire 500 people in the U.S. this year as the economy improves and Europe works out its debt crisis, Vivek Ranadive, chief executive officer of the Palo Alto, California-based company said in an interview. “We are hiring quite rapidly now, all in sales and service,” Ranadive said last week at the World Economic Forum’s annual conference in Davos, Switzerland. “It’s a good time to hire.” The Institute for Supply Management said today that its index of non-manufacturing industries, which account for almost 90 percent of the economy, rose to 56.8 in January from 53 a month earlier. The Tempe, Arizona-based group’s measure was projected to climb to 53.2, according to the median forecast in a Bloomberg survey. Readings above 50 signal growth. Construction companies added 21,000 workers last month. The number of people unable to go to work because of bad weather, a proxy for the climate’s effect on the labor market, was 206,000 last month, less than half the 424,000 average for the month since 1976. The shortfall signals mild weather may have played a role in the gain in employment, according to Neil Dutta, an economist at Bank of America Corp. in New York. Government Payrolls Government payrolls decreased by 14,000 in January, reflecting cuts at the federal and local levels. Average hourly earnings rose 0.2 percent to $23.29, today’s report showed. The average work week for all workers held at 34.5 hours. The so-called underemployment rate -- which includes part- time workers who’d prefer a full-time position and people who want work but have given up looking -- decreased to 15.1 percent from 15.2 percent. The Fed said on Jan. 25 after a two-day meeting that it would keep its benchmark lending rate low “at least” until late 2014 from a prior target of mid-2013. Bernanke, speaking at a news conference after the meeting, said that the option of a third round of large-scale bond purchases, known as quantitative easing, is still “on the table.” ‘Long Way to Go’ “We still have a long way to go before the labor market can be said to be operating normally,” Bernanke told the House Budget Committee in Washington yesterday. Today’s figures may change the Fed’s thinking, said Michael Feroli, chief U.S. economist at JPMorgan Chase & Co. in New York. “The report definitely scales down the odds for QE3, particularly the drop in the unemployment rate,” Feroli said. “There is strength in the labor market.” The number of unemployed Americans dropped to 12.8 million, the lowest since January 2009, from 13.1 million in December. Still, the number of those who have been unemployed for 27 weeks or more -- a source of concern for the Fed -- was little changed at 5.52 million and accounted for almost 43 percent of the total. “We should welcome the headline numbers, they are really good, but we should not lose sight that we have structural issues that aren’t being dealt with,” Mohamed A. El-Erian, chief executive officer of Pacific Investment Management Co., said in an interview on Bloomberg Television’s “In the Loop” with Betty Liu. Among those still looking for work is Richard Richardson, 33, a former assistant district attorney for the city of San Francisco who moved to the Washington area with his wife last year to look for a government job. “It’s been a trying process,” he said, adding that he hasn’t yet had a single interview. Still, “I do feel confident that it’s just a matter of time.”

Danbury firefighters reject labor contract - Dirk Perrefort - newstimes.com 03-February-2012 DANBURY -- Members of city's firefighters' union have overwhelmingly rejected a proposed labor contract, and officials pledged Thursday to bring the matter to arbitration. In recent weeks, most of the city's labor unions have signed on to four-year contracts that Mayor Mark Boughton said make sweeping changes to pension plans. This week, however, Danbury firefighters rejected a proposed contract, with 77 of the union's 117 members voting against the agreement and 22 voting in favor. Eighteen members did not vote. Boughton said Thursday that he will take the contract to binding arbitration -- a process where both sides bring their last, best offers to a third party, who makes a final determination binding on all parties. Lou DeMici, president of the Danbury Professional Firefighters Union Local 801, said that while firefighters understand the economic realities faced by the city and members agreed to several concessions, including changes to the pension plan, "Firefighters could not agree to decrease benefits to line-of-duty injuries as proposed by the city." After significant concessions in areas including pensions, DeMici said. "It was not acceptable to the union to undermine an individual who may be injured on the job." Boughton said the proposed benefits change is similar to one members of the police union agreed to late last year. While injured police and fire employees who are fully disabled would have their health and life insurance paid until age 65, Boughton said, those who are partially disabled or injured outside of work would receive a percentage of their benefits paid by the city, in amounts that increase with time of service. Currently, anyone who is disabled, Boughton said, receives medical benefits until their retirement age regardless of the extent of the injury, where it occurred or how many years they've been with the city. "That's something the city simply can't afford," he said. Other unions that have recently ratified contracts with the city include three Teamsters units that represent public works employees, and members of the Danbury Municipal Employees Association, which ratified its contract on Jan. 30 with 67 members voting in favor and only one against the contract. Frank Sequenzia, president of the DMEA, said that while it wasn't a great contract, most members agreed that it was fair and better than going to arbitration. "We wanted to avoid that at all costs," he said. Boughton said the most significant aspects to the labor agreements ratified in recent weeks include sweeping changes to the city's pension system. Existing employees will now have to contribute a percentage to their pension accounts, the mayor said, while new employees will be offered a defined contribution plan similar to 401(k) plans offered in the private sector. Boughton said the changes will significantly affect the city's pension liability in the long term. "According to our projections, if we didn't do these kinds of changes as our workforce turns over, the city could face a pension liability that could have put it into bankruptcy" in 10 to 15 years, Boughton said.

CT high court upholds contractor’s anti-union challenge - By Brad Kane - Hartford Business 03-February-2012 The Connecticut Supreme Court has upheld a Hartford electrical contractor's challenge of the state's requirements that union workers be used on public construction projects, possibly hastening an end to such requirements, authorities say. Electrical Contractors Inc. successfully bid on two Hartford school construction projects, but the company challenged the inclusion of a project labor agreement (PLA) on each project, saying it should not be forced to use union labor on the jobs. In ruling on Electrical Contractors' lawsuit against PLAs, the lower court dismissed the case, saying the plaintiff lacked standing to challenge the city and state's union requirements. The company appealed to the state Supreme Court in 2009. In its Jan. 17 decision, the high court ruled 6-1 that Electrical Contractors could challenge, and ordered the case back to the lower court to determine whether the plaintiff and its workers should receive monetary awards for being subject to the PLA. The justices said Electrical Contractors is correct in claiming that PLAs are discriminatory and perpetuate fraud, corruption and favoritism, and that Electrical Contractors could challenge PLAs on the grounds of the Connecticut Antitrust Act. Citing the high court's strong wording, the Connecticut Associated Builders & Contractors Inc. said Electrical Contractors or another contractor may be successful in eliminating these union requirements from all jobs. "The decision seems to believe that all PLAs are illegal," said Connecticut ABC President Lelah Campo. Campo said even if Electrical Contractors isn't successful in winning monetary claims from the lower court, Connecticut ABC plans to submit more legal challenges in the future to directly have PLAs ruled illegal. "For the most part, it shuts out open shops, which are 83 percent of the industry," Campo said. "When you shut out 83 percent of the industry, of course it drives up the cost." Connecticut ABC is issuing notices to all owners of public projects that their PLAs could one day be illegal. Campo particularly called out the $839-million renovation of the University of Connecticut Health Center as part of the Bioscience Connecticut project, which will have a PLA. Unions say Connecticut ABC is making much ado out of nothing. The Supreme Court decision only granted Electrical Contractors standing to challenge PLAs and did not outright rule PLAs are illegal, said Charles LeConche, business manager of the Connecticut Laborers' District Council. "The ruling means nothing. It means they have standing," LeConche said. LeConche said the Supreme Court justices were mostly appointed by Republican governors, so the decision wasn't a surprise to the unions. The case and PLA challenge still has to play out in the lower courts. It could take six months or a year before the lower court hears Electrical Contractors arguments on the case again. "I wish them luck, but they are not going to win," LeConche said. "The future will dictate what the final ruling will be."

As State Workers Seek New Unions, Critics Say State Should Stay Out Of The Fight - By MATTHEW STURDEVANT - The Hartford Courant 03-February-2012 Two Republican state lawmakers and a union seeking to represent state workers say Gov. Dannel P. Malloy's administration is wasting taxpayer money on lawyers to fight employees' right to vote for a different union. "These members want an opportunity to vote and decide their future, and the unfortunate thing is, we're witnessing government resources being utilized to question them, and to challenge their right and their choice, and it's really not fair," state Rep. Chris Coutu, R-Norwich, who is running for Congress in the 2nd District. The issue stems from a months-long battle in which state workers in six bargaining units, unhappy with a 5-year labor deal reached with Malloy last year, petitioned for the right to join a new union. It's a rare example of one union making a play for workers that are already organized by another — and a series of contentious hearings has ensued, turning on obscure points of state labor law. Malloy's administration and representatives for the state Judicial Branch and state Division of Criminal Justice say there's nothing unusual about sending attorneys to protect an existing contract. "The whole purpose of this effort is to undermine the contract entered into by SEBAC and the state," said Malloy's general counsel, Andrew McDonald, referring to the State Employees Bargaining Agent Coalition, which covers most state workers. McDonald added that the state has a legal interest when "someone tries to scuttle the contract." In an unprecedented labor dispute for Connecticut, two unions that don't represent any Connecticut state employees are fighting for the right to take over the six state bargaining units with 6,000 members. The unions claim thousands of affected workers have signed cards seeking to throw out their current unions. The fight over representation is now a protracted legal battle before the state Board of Labor Relations, which has barely contained lawyers talking over one another in chaotic, hours-long meetings in December and January. More meetings are scheduled this month. The United Public Service Employees Union seeks to represent five groups, including judicial marshals, transportation engineers, protective services employees and others; the National Correctional Employees Union seeks to represent correction supervisors. Barbara J. Resnick, a lawyer for UPSEU, said two attorneys who are state employees have attended all of the labor board meetings, and that outside attorneys have been hored by the state, "to obstruct the members' right to be entitled to their right to choose and a vote." Office of Labor Relations Director Linda Yelmini said Attorney Ellen Carter "represents us in any dispute, meaning us the state, and any dispute in front of the labor board." Justice Branch spokeswoman Rhonda Stearley-Hebert confirmed that the state courts system brought in outside attorneys with Siegel, O'Connor, O'Donnell & Beck, P.C., because the labor issue is beyond the in-house lawyers' expertise. The Division of Criminal Justice is represented by Shipman & Goodwin in all labor matters, a spokesman said. Among those in the Connecticut State Employees Association who want to vote are some members of the Service Employees International Union, P-4, which represents about 2,500 engineering, scientific and technical workers. Some of the employees contacted UPSEU for help, and the union responded. Members of P-4 who gathered outside a state labor board meeting in December said they are college-educated, often well-paid professionals whose interests are not necessarily aligned with SEIU, which they said lobbies for causes such as federal health care reform. SEIU, AFSCME and other unions currently representing the workers say there was a narrow window of time — the month of August — for union members to change unions. Under the contract rules, collective bargaining units for state workers are allowed to take a poll of their members during the August before a contract expires to determine if they want to be represented by another union. If the union gets confirmation from enough members via "interest cards," then members can hold an election to vote whether to stay with its current union or seek a new one — but only at that time. UPSEU said it has those signatures in hand, but some current state unions are questioning whether the petitions were conducted properly.

Republican Lawmakers Support Union’s Right To Vote - by Christine Stuart - CT News Junkie 03-February-2012 Updated 3:40 p.m.)It was an odd political pairing. Two Republican lawmakers stood alongside union members Thursday arguing that its members should have the right to vote to switch unions. The matter currently before the Labor Relations Board pits several State Employee Bargaining Agent Coalition unions against the United Public Service Employee Union, which believes they collected enough cards last August to allow for a vote. It is the first time in this ongoing battle that pits union against union that a lawmaker has voiced their support for UPSEU. Sen. Joseph Markley, R-Southington, who has been fighting against Gov. Dannel P. Malloy’s executive orders which allow personal care attendants and daycare workers to unionize, said his support of the union members in this case is not in conflict with that position. “I think in both cases the common thread is the fact that the state government, that the administration is pushing a particular agenda in terms of the union,” Markley said. “In this case preventing a group from having the right to choose what union they want to have representing them.” In the case of the controversial SEBAC agreement, which the legislature voted to ratify before the second vote by the union members, it created a process that did not exist, Markley said. The same is true for the executive orders. He said he would not have felt same way if it had come through the legislature. “I would have felt like I had perhaps lost, but I had lost a fair game,” Markley said. “In that case, instead a decision was made outside of the rules, outside of the process to get an end which the administration desired.” Markley was also one of the 30 senators during a June special session who voted along with his Democratic and Republican colleagues in favor of legislation which would have changed the way state employee pensions are calculated. “They’re being supported on this particular issue, which is an issue of their right to choose” Markley said. Rep. Chris Coutu, R-Norwich, tried to make the case that Malloy’s administration is motivated to keep the current union membership with SEBAC because it benefits it politically. Barbara Resnick, the attorney for UPSEU, said it’s unusual that the state has retained two outside law firms to attend all formal and informal meetings on this issue. The law firms, Shipman & Goodwin, was retained by the Division of Criminal Justice, and Siegel O’Connor was retained by the Judicial branch, neither are executive branch agencies. Coutu said the state’s use of two outside law firms to help SEBAC fight to remain the only union the state has to deal with just proves that the governor knows he will lose political support, if he doesn’t support them. “It’s another angle that there is money being lost here for the governor and his team politically,” Coutu said. He said UPSEU doesn’t use their member dues to fight political games. What do the members think? “I find it kind of annoying that we don’t have any Democrats standing up for our right to vote,“ John Vitale, past president of the P-4 Council, said Thursday. “Whatever side you fall on it’s a fundamental right to vote.” He said there are members he knows who want to stay in their current CSEA/SEIU Local 2001 union, but believe the membership should have the right to vote. Stephen Anderson, the current P-4 Council president, said the workers at the Capitol press conference today were the same workers who opposed the SEBAC agreement. He they’re still bitter the $1.6 billion concession package passed the second time by a majority of the membership. The package made changes to health and pension benefits. “It speaks volumes that these individuals along with UPSEU have chosen to align themselves with some of the most notorious, anti-union legislators in the state,” Anderson said. Attachment H The current battle at the Labor Relations Board is over “Attachment H” which the state and SEBAC argue doesn’t allow UPSEU to decertify any of the SEBAC unions. The clause is being used to block employees trying to oust the current unions that represent them. Many employees complained that they never saw the attachment before they voted on the State Employee Bargaining Agent Coalition agreement. Resnick said that’s because it wasn’t even finished yet. She said they didn’t know about the agreement so they couldn’t have anticipated they were voting to give away their right to choose which union represents them going forward. She argued the legislature also didn’t know about the agreement when it voted to pre-ratify it. J. William Gagne, an attorney representing one of the SEBAC unions, has said he doesn’t believe the Labor Relations Board has the power to overturn the will of the General Assembly which accepted the agreement, including the Attachment H. “The legislature could pass a statute saying there’s no more Labor Board and that’s the end of it,” Gagne has said. The SEBAC unions have maintained that Attachment H is standard legal language, which doesn’t allow any of the SEBAC membership to go after each others’ members.

The Darkening Tone of the Primaries - The New York Times - Opinion Pages 02-February-2012 After two weeks of mean-spirited campaigning in Florida, where the Republican contenders jockeyed for the right-most flank of their party, maybe it should not have been shocking when Mitt Romney announced that he is “not concerned about the very poor.” Speaking on CNN on Wednesday, and in a lame attempt later to spin his remarks, Mr. Romney tried to explain that he was focused on middle-income Americans because the poor — now a full 15 percent of the population — already have a government safety net. He failed to mention, of course, that his policies, and those of his fellow Republicans in Washington, would drive more people into that net — while at the same time shredding it. The remark was in keeping with the callous tone of the campaign for the Florida primary, in which Mr. Romney handily beat Newt Gingrich. Even in his victory speech Tuesday night, Mr. Romney hinted darkly at the tone of the campaign to come. He accused President Obama of ordering “religious organizations to violate their conscience” and vowed to defend religious liberty. It was a reference to the Obama administration’s requirement that large religious institutions, like hospitals and universities, provide insurance coverage for birth control. He was promising to defend the Roman Catholic Church’s “religious liberty” to deprive its tens of thousands of employees and university students of their own liberty. Tellingly, that was a cheap remark stolen from Mr. Gingrich, who had accused Mr. Romney of the same thing for a similar action he took while governor of Massachusetts. He even claimed, absurdly, that Mr. Romney took kosher food out of the mouths of Holocaust survivors. Rather than repudiate such tactics, the lesson Mr. Romney took is that any line, no matter how brutal, is fair game if it brings a few more angry voters to your side. Of course, that didn’t work too well for Mr. Gingrich, whose willingness to say virtually anything — promising Cuban-Americans that he would start a violent uprising to overthrow the Castro regime, for instance — left him without the support of a single demographic group. When Mr. Romney descended into the mud with him, it soured many voters about the entire Republican field, according to several polls. Independents have been particularly turned off by Mr. Romney’s hard-right stridency. Mr. Romney has spent so much time on the attack against either Mr. Gingrich or Mr. Obama that his only positive message in Florida was an off-key rendition of “America the Beautiful.” At a time when the country is increasingly concerned about economic inequality, a candidate worth $250 million says he is not concerned about their welfare because government programs — many of which his budget would gut — will take care of them. Among the middle Americans that Mr. Romney says he is focused on are 51 million people just above the poverty line, according to the Census Bureau. Many of them fear slipping beneath it, and now they know that will mean disappearing from the concerns of the Republican presidential front-runner. After winning on Tuesday, Mr. Romney said his campaign was “about saving the soul of America.” If this is the direction he plans to take in the coming months, he will first need to save the soul of his campaign.

State Rep. Dan Carter: Spending cuts in all the wrong places - state Rep. Dan Carter - Newstimes.com 02-February-2012 When Gov. Dannel P. Malloy announced last week that he intends to make spending cuts in order to prevent ending the fiscal year in a deficit, I was very pleased. After all, my fellow Republican legislators and I advocated strongly last session for greater spending cuts in place of the painful tax increases that were proposed and eventually passed. However, it's critical to make cuts in the appropriate and fair areas, as there are many valuable services, programs, and causes that are essential for the state to fund. One of those causes, veterans' affairs, is very near and dear to my heart. I have the deepest respect and appreciation for the selfless efforts of the service men and women throughout the state and beyond, and I believe that they deserve all of the valuable services the state offers to them. Gov. Malloy, unfortunately, has a different opinion about what our Connecticut veterans do and do not deserve from state government. He decided to use his rescissionary authority to cut nearly $79 million from the current budget, including $17,500 from the Department of Veterans' Affairs account for headstones. Other items on the chopping block include $2 million in personal services or staffing expenses at the Department of Developmental Services, and cuts to various private museums, theaters and attractions throughout the state. I find it unethical to not only deprive fallen veterans the decency of a headstone -- the least our state can do to honor them for the ultimate sacrifice -- but to know that the other cuts are so comparatively trivial is very upsetting. Certainly museums and theaters are an important part of our community, but when it comes down to denying a fallen serviceman or woman a headstone, there's no comparison. There are many other things that should be cut before the relatively small pool of money put aside for our veterans. Specifically, the Governor squandered his opportunity to gain the appropriate union concessions, many of which he did "garner" ended up being phantom savings, such as his employee suggestion box that he attributed tens of millions of dollars in savings that are yet to be realized. The cut to the Department of Veterans' Affairs was entirely up to the Governor's discretion and is completely unnecessary. The choice was made because he failed to gain a reasonable level of union concessions, essentially choosing unions over veterans. I want to emphasize that I am whole-heartedly in favor of spending cuts, but not on the backs of our neediest and most deserving citizens. There are many other cuts that should be put in front of veterans, including the taxpayer-funded cars used by our constitutional officers, as well as Gov. Malloy's 2007 Lincoln Town Car which he is chauffeured around in. In fact, the Governor's "Plan B" budget estimated savings of $10,567 annually by cutting Secretary of the State Denise Merrill's car and $6,500 for State Comptroller Kevin Lembo's, given the differential between assigning constitutional officers cars or paying for their mileage. The combined savings in cutting those two officials' state cars adds up to almost exactly the amount the headstone fund is being cut, and seems like a much more appropriate and ethical cut. I will continue to fight for veterans' rights and privileges, as well as appropriate state spending cuts as we begin the upcoming legislative session on Feb. 8. State Rep. Dan Carter, a Republican, represents the 2nd District, which is portions of Bethel, Danbury and Redding.

‘Poor’ Quote by Romney Joins a List Critics Love - By ASHLEY PARKER - The New York Times 02-February-2012 MINNEAPOLIS — Obsessive attention to detail suffuses Mitt Romney’s candidacy for president, from the number of times staff members check the microphones at his rallies to their relentless scouring of Twitter. But Mr. Romney’s aides cannot always bring that well-known level of discipline to one crucial aspect of the campaign: their candidate’s seemingly endless ability to utter remarks that, to the delight of his critics, sail onto political blogs, YouTube and Twitter. On Wednesday morning in an interview with CNN, Mr. Romney said, “I’m not concerned about the very poor,” a sound bite that ricocheted around the Web and cable news channels, and which Mr. Romney felt the need to clarify with reporters as he flew to Minnesota. The comment captivated the political chatter, at least for the day, because it seemed to reinforce what might be his rivals’ most potent line of attack against him: that Mr. Romney, with a net worth estimated at $200 million, is out of touch and unable to relate to struggling Americans. Taking in the full context of his remarks, as Mr. Romney urged reporters to do, his statement seems more benign: “I’m not concerned about the very poor. We have a safety net there. If it needs a repair, I’ll fix it. I’m not concerned about the very rich; they’re doing just fine.” He is most concerned about the middle class, he said. But for a campaign that has itself been accused of taking President Obama’s words out of context, the remark about the poor immediately became cataloged in a growing list of awkward comments by Mr. Romney, including a remark that his speaking fees last year of $374,327 were “not very much” and his line that “corporations are people.” Unlike President George W. Bush’s malapropisms, which generally served as late-night punch lines, Mr. Romney’s foot-in-mouth comments have an economic undertone, which have gained traction because they perpetuate his critics’ attacks that he is an unfeeling corporate titan. “Now let me just say something,” Newt Gingrich said when asked about the “poor” comment. “I am fed up with politicians of either party dividing Americans against each other.” “I am running to be the president of all the American people,” he added, “and I am concerned about all the American people.” Although Mr. Romney has become a better campaigner in many ways, he cannot seem to stop making inopportune remarks. Last June, he told a group of unemployed workers in Florida, who had just finished telling him their stories, that he understood their plight. “I’m also unemployed,” Mr. Romney said as a joke. “I’m networking. I have my sight on a particular job.” At a debate, he offered Gov. Rick Perry of Texas a $10,000 wager — an amount that, even if facetious, reminded voters just how much disposable income Mr. Romney has. Speaking to crowds in New Hampshire, Mr. Romney claimed that he, too, had feared the “pink slip” during his life. So, on the plane to Minnesota on Wednesday, Mr. Romney found himself in a familiar situation, forced to walk back gaffes. When asked to elaborate on the “poor” remark, Mr. Romney said, “I’ve said throughout the campaign my focus, my concern, my energy is going to be devoted to helping middle-income people, all right?” “We have a safety net for the poor in the country, and if there are holes in it, I will work to repair that,” he added. “And if there are people that are falling through the cracks, I want to fix that.” He also made a substantive nod to low-income workers, renewing his support for automatic increases in the federal minimum wage to keep pace with inflation — a position sharply at odds with most of his party. “I haven’t changed my thoughts on that,” he said.

Lembo Confirms GAAP Deficit of $73.6M - by Christine Stuart - CT News Junkie 02-February-2012 State Comptroller Kevin Lembo said he’s anticipating the state will end the fiscal year with a $73.6 million deficit under Generally Accepted Accounting Principles. The estimate represents an erosion of about $82.3 million from last month’s projections. “Despite the projected state shortfall, the economy continues to show slow and erratic growth – overall headed in a positive upward trajectory,” Lembo said. Lembo expressed confidence Wednesday that Gov. Dannel P. Malloy will be able to correct the issue by taking the steps he’s already taken to rescind about $79 million in spending. Office of Policy and Management Secretary Ben Barnes said last week that about $44 million of the $79 million have already been counted as lapses and about $34 million are in new spending cuts. Regardless, Lembo said he’s confident the Malloy administration will be able to balance the budget before the end of the fiscal year. Lembo agreed with the Office of Policy and Management and the Office of Fiscal Analysis’s consensus revenue estimates which show revenues dropped by nearly $95 million largely due to low collections in estimated income tax payments. State spending changed little from last month and is trending 2.3 percent more than last year, Lembo said. He said OPM’s projection of a 5.9 percent growth is dependent on $900.7 million in lapses or forced savings, which should be “attainable” even though they are higher than in previous years. “In light of state spending trends – and the budget control mechanisms available to OPM – this estimated savings is reasonable,” Lembo said. “I must emphasize that my analysis is based on the total state spending trend for the year, and not on achieving savings in any individual areas within the budget plan. The potential need to shift funds in order to address a savings shortfall is ultimately a matter for the administration and legislature.” The legislature’s Office of Fiscal Analysis believes the budget hole may be larger, but their estimates were completed last week before Malloy announced the $79 million in rescissions. OFA pegged the deficit at $145 million, prior to the rescissions. Neither Secretary Ben Barnes in his Jan. 20 letter to Lembo, or Lembo in his letter to Malloy Wednesday put a number on the potential projected deficiencies related to the changes made this summer to the state employees labor agreement. Barnes acknowledged in his Jan. 20 letter that OPM is projecting two significant net deficiencies in the account that funds health care for retired state employees, and a shortfall is also expected in the account that funds pension payments to state employees. Some of those shortfalls are related to changes in the State Employees Bargaining Agent Coalition agreement and the 2,700 retirements that followed. But no numbers were attached to those potential deficiencies.

Connecticut House Sales In 2011: Lowest In A Generation - By KENNETH R. GOSSELIN - The Hartford Courant 02-February-2012 Connecticut's house sales in 2011 sank to their lowest level since at least the mid-1980s, dropping below even the levels of the devastating housing recession that gripped New England in the early 1990s. The 13 percent plunge in the number of single-family house sales in 2011 marked the seventh straight year of year-over-year declines — and there are few prospects for much of a rebound this year, even as the market approaches the spring buying season, traditionally the busiest time of the year. Prices also fell in 2011 compared with 2010. But the slight decline of 2.8 percent in the median price of houses that sold, reported by The Warren Group, does not necessarily mean that the value of most houses is still falling. A plan announced by the White House on Wednesday to help homeowners with underwater mortgages refinance could boost the housing market, keeping more borrowers in their homes and out of foreclosure — easing the number of foreclosed properties competing with other properties. In Connecticut, some sellers say their frustration with the slow pace of the market is building — forcing them to the sidelines because they are unwilling to drop their asking prices any lower. In Wethersfield, Paul Signorello has been helping his father, Pietro, sell his home ever since 2009, a year after his mother died. Back then, the 3,100-square-foot split-level was listed for $489,000, but the house came off the market after several months when there were no offers. Signorello's father, who has since moved to a smaller home, listed the house for $432,900 last September. "Now, we're down to $399,000, and we're giving the house away, and we can't even get any showings," Paul Signorello said. "Now, he's at the point, he just wants to sell, but he may have no choice but to rent it. He understands he will have to take a hit, but how much of a hit do you have to take?" Signorello and his father have plenty of company: Sales of single-family houses in Connecticut dropped to 21,141 in 2011, down from 24,270 in 2010, according to the report Wednesday from The Warren Group, which tracks housing trends in Connecticut and elsewhere in New England. Last year's figure fell below the previous low point of 23,739 sales in 1991. Record-low mortgage rates have done little to boost the housing market, as high unemployment and tighter lending requirements have held back sales. Potential home buyers worried about the stability of their jobs aren't willing to make big purchases. Borrowers who are comfortable purchasing a house are finding it difficult to get a loan, lenders requiring strong credit scores and sizable down payments. "People are still waiting for the deal of a lifetime," said John Zubretsky Jr., president of Weichert, Realtors—The Zubretsky Group in Wethersfield. "There's uncertainty: 'Is it going to be worth less on the day I buy it?' It's like driving a car out of the lot. People are saying, 'I don't know, I just don't know.'" House sales in Connecticut on a year-over-year basis fell in 10 months in 2011, rising only in January and August. The decline in sales was particularly sharp in some months because a federal home buyer tax credit in the first half of 2010 lifted sales — but the hoped-for lasting momentum did not materialize. Despite the sales decline in 2011, the median sale price in Connecticut dipped just 2.8 percent, to $243,000 from $250,000 in 2010. Zubretsky said that prices might still erode further this year, pulled down by foreclosure sales and short sales, in which the lender agrees to accept less that what is owed on the mortgage. This housing recession in Connecticut differs from the early 1990s because of the number of residential foreclosures, touched off by loose lending to risky borrowers who couldn't ultimately afford their mortgages and deepened by a recession that cost tens of thousands their jobs, Zubretsky said. "It has turned the market upside down," Zubretsky said. "It's going to take 3 to 5 to recover, and that's not months." Although Wednesday's report paints a dismal picture of the state's residential housing market, sales are still occurring, and multiple offers aren't unknown, if a house is priced right for its location, real estate agents say. But there are other troubling signs for the state's housing market. New home construction in 2011 dipped to its lowest level in decades, as housing permits for single-family houses, condominiums and apartments fell below 3,000 in the 128 towns and cities tracked by the state. By contrast, a healthy market would have between 8,000 and 10,000 permits issued annually. Donald L. Klepper-Smith, an economist at DataCore Partners in New Haven, said there must be marked improvement in the jobs market before housing will get any sort of significant lift. "Our labor markets are healing very slowly," Klepper-Smith said. "We're not looking at things coming back in a large way anytime soon." Klepper-Smith said he would need to see annual, year-over-year sales increases in the double digits to sense that a recovery in the housing market was taking root. The number of house sales declined across all eight Connecticut counties in 2001, from a 6.5 percent decline in Tolland County to a 23 percent plunge in New London County. In Hartford County, sales fell 11.2 percent to 5,195 from 5,850 a year earlier, according to The Warren Group. The median sale price dipped 4 percent, to $215,000 from $224,000 in 2010. A separate report Wednesday by RE/MAX of New England noted that sales in Connecticut's luxury home market fell in the last three months of 2011, compared with the same period a year earlier. But prices per square foot rose in the four Connecticut markets surveyed: Darien, Greenwich, New Canaan and Westport. On Wednesday, President Barack Obama outlined a plan to help homeowners refinance, even if they owe more than their property is worth — a condition known as being underwater. The opportunity to refinance could save borrowers an average of $3,000 a year, the White House said. Obama pointed out that the program was not intended to be a quick fix. "Now, the truth is, it's going to take more time than any of us would like for the housing market to fully recover from this crisis," Obama said in a speech announcing the plan. "This was a big bubble, and when it burst it had a big effect." Obama said that previous programs rolled out by his administration haven't been as successful as expected. Some of those did not gain the full support of banks and other lenders who needed to implement them. "If you're ineligible for refinancing just because you're underwater on your mortgage, through no fault of your own, this plan changes that," Obama said. "You'll be able to refinance at a lower rate. You'll be able to save hundreds of dollars a month that you can put back in your pocket."

The Privatization of Public Services, State by State - Donald Cohen - In The Public Interest 02-February-2012 Donald Cohen, founder and executive director of In the Public Interest, a national resource center on privatization and responsible contracting, sends us this. It seems there’s no public service or piece of property that private companies are not eyeing as potential revenue streams. While funding anti-government think tanks like the American Legislative Exchange Council (ALEC), companies like Corrections Corporation of America, Waste Management, Maximus, Intuit, Laidlaw, Northrup Grumman, Koch Companies, Macquarie Capital Advisers, Pinnacle West, and UnitedHealthcare are hoping to use government as their candy store. They want to take over our roads, bridges, parking lots, water systems, college dorms, and prisons. And they want to deliver public services like transit systems, school cafeterias, trash and recycling pick up, mental health services and many others. The following is a quick scan of just some of the proposals. Water The Emergency manager of Flint, Mich., is considering selling off its water and sewer systems to the highest bidder. The systems are currently generating revenues for the city. Long Island’s Nassau County Executive Edward Mangano’s proposal is proposing to privatize the county’s sewage treatment system. Mangano also announced the privatization of Long Island Bus company to Veolia Transportation. The Texas Lower Colorado River Authority is selling 18 retail water and wastewater systems in the Hill Country and in its southeast service area to [Canada-based] Corix Infrastructure. Schools School districts across the country are planning to contract out custodial, clerical, cafeteria and bus services. In Michigan, home to the right-wing, privatization think tank, the Mackinac Center, lots of school districts are moving forward with plans including Muskegon Heights, West Branch-Rose City, Rochester districts. The real estate industry, seeing potential profits from the growth in charter schools, wants in. One company, Entertainment Properties, a real estate investment trust, primarily a movie theater landlord, now owns 34 charter-school properties and sees “a huge capacity to grow.” Prisons The Florida Senate failed to vote on a controversial proposal to private prisons in South Florida. A labor community coalition including AFSCME, Teamsters, the Justice Policy Center, Grassroots Leaders and the Police Benevolent Association mobilized members and press opposition. Perhaps the Gainesville businessmen who were sentenced to federal prison for paying kickbacks to the former secretary of the state department of corrections official after the prison canteens system was privatized had an impact. Liquor The liquor industry is pushing hard to take control of state systems that now generate funds for cash-strapped governments. Ohio Gov. John Kasich is privatizing the state’s liquor distribution system in a $1.4 billion dollar deal. The Idaho Federation of Reagan Republicans submitted a citizen’s initiative to the secretary of state’s office that would privatize liquor sales in Idaho and eliminate the state Liquor Division. Michigan Gov. Snider is proposing to deregulate the state’s alcohol distribution system. The Michigan Liquor Control Commission generates an estimated $330 million for the state’s general fund. Snider’s Liquor Control Rules Advisory Committee is stacked with representatives from sectors that profit from alcohol sales. It’s not all bad news. Record profits at state-owned liquor stores in Virginia “may have sounded the final death knell for Gov. Bob McDonnell’s proposal to privatize” them.

Disputed rule intended to shame CEOs - By Peter Schroeder - The Hill 02-February-2012 Business groups and unions are sparring over a little-known provision in the Dodd-Frank reform law that supporters concede is an effort to shame the nation’s highest-paid CEOs. The rule, which predates the Occupy Wall Street movement but channels it in spirit, requires companies to disclose the difference in pay between their chief executives and average employees. An industry-spanning roster of business groups, including the U.S. Chamber of Commerce, the Financial Services Roundtable, the Securities Industry and Financial Markets Association and the National Association of Manufacturers, argue the salary data are difficult to collect and of no interest to investors. “It’s really a political talking point that’s managed its way into legislation,” said Tom Quaadman, vice president of the capital markets center for the U.S. Chamber of Commerce. Critics of the provision are at work trying to repeal it. The House Financial Services Committee approved legislation sponsored by Rep. Nan Hayworth (R-N.Y.) that would do away with the disclosure requirement. But the repeal movement is unlikely to make headway in the Senate, where Democrats are lining up behind President Obama’s election-year message of working to “level the playing field” for workers and reduce income inequality. With repeal unlikely for now, industry groups are encouraging regulators to take their time implementing the provision, and to solicit plenty of business input along the way. Labor groups and other critics of Wall Street, meanwhile, are urging the Securities and Exchange Commission to move swiftly to put the requirement in place, and dismiss arguments that it’s more trouble than it’s worth. “It’s quite astounding that a relatively simple disclosure requirement would trigger so much hand-wringing,” said Brandon Rees of the AFL-CIO, which pushed for the provision’s inclusion in Dodd-Frank. “They will be embarrassed, and that’s the whole point,” Rees said. Sen. Robert Menendez (D-N.J.) inserted the largely overlooked provision into the Wall Street reform bill while he was serving as chairman of the Democratic Senatorial Campaign Committee. He said supporters of repeal are fighting a losing battle. “Those who would seek to roll back this provision are shilling for corporations and CEOs,” Menendez told The Hill. “It will never see the light of day in the Senate.” The salary rule requires publicly traded companies to disclose in their annual financial statements exactly how much the CEO makes, how much the median employee makes, and the ratio between the two. Businesses say figuring out how much each employees makes is no easy task and question what value the information could have for investors — the whole reason corporate disclosures are required. “We think that the legislation is not helpful and that the disclosure is not helpful, and we’re working to obviously try to repeal the provision,” said Tim Bartl, senior vice president and general counsel for the Center on Executive Compensation, an association that represents human resource officials for some of the nation’s largest companies. “The more we look into it, the more we realize the complexities.” In a letter to the SEC earlier this month, 23 business groups argued that the requirement would prove particularly problematic for multinational companies that would have to grapple with vastly different pay structures when making the calculations. Furthermore, they argued, investors who rely on corporate disclosures are not interested in how much a CEO makes when compared to the median employee. “It doesn’t convey any information about the health of a company,” Quaadman said. “It is difficult to see where the costs actually outweigh the benefits.” Backers of the provision are not persuaded. “It’s our belief that companies that have effective internal controls over their compensation processes will have no problem disclosing that,” Rees said. The business community is focusing its attention on the SEC as it battles the rule. Unlike many provisions in Dodd-Frank, the salary provision does not have a statutory deadline for regulators to implement it, opening the door to a drawn-out process. The SEC originally said it wanted to complete work on that provision by the end of 2011, and now says on its website that it hopes to get it done by the close of 2012. Businesses are insisting that the SEC needs to take its time and “resist rushing” a regulation that could pose substantial compliance costs. Menendez said he is urging the SEC to finish it as soon as possible. “This is about trying to hide the information,” Rees said. “It’s just delay, delay, delay.”

Council 4 Union Demands Impact Bargaining Over Merger of East Lyme and Waterford Dispatch Operations - Posted by Larry Dorman - WaterfordPatch 02-February-2012 New Britain, CT, Feb. 1, 2012 — Council 4 AFSCME, the union representing East Lyme dispatchers, says the Town of Waterford has a legal obligation to bargain the impact of an agreement with East Lyme to share dispatch operations. In a letter to Waterford First Selectman Dan Steward, Council 4 Staff Representative Wayne Meyers wrote the following: “It has come to the attention of the Union that the Town of Waterford will be the new employer for members of AFSCME Local 1303-436. Due to the fact that the members being merged are union employees under a current contract, the union demands to negotiate the impacts of said merger.” Meyers is the chief negotiator for AFSCME Local 1303-436, the East Lyme Town Dispatchers. He also sent copies of the letter to East Lyme First Selectman Paul Formica and the entire Waterford Representative Town Meeting. The dispatch merger first requires the approval of the Waterford RTM.

Real Reform Of State Pensions: Switch To 401(k)s - The Hartford Courant 30-January-2012 Before hopping a plane to Switzerland and a seat at the World Economic Forum this week, Gov.Dannel P. Malloyasked the legislature to OK a $125 million payment into the pension plan for state workers as part of an effort yet this year to make the pension plan — now funded at an anemic 48 percent — cover all liabilities by fiscal 2032. The sorry state of Connecticut's pension plan isn't Mr. Malloy's fault; the underfunding damage was wrought before he was governor. And Mr. Malloy's pension proposal is fine as far as it goes. It helps to answer the objections ofMoody'sInvestors Service, which downgraded Connecticut's credit rating a notch last week in part because the state has "pension-funded ratios that are among the lowest in the country and likely to remain well below average." But the governor doesn't go nearly far enough in prescribing pension-reform remedies. And Mr. Malloy doesn't specify exactly where he's going to get the $125 million to deposit in the pension plan at a time when the state budget faces the possibility of deficits this fiscal year and in the next one because of lagging revenues. But there's a more fundamental problem. Connecticut's old-fashioned "defined-benefit" pension plan, to which employees contribute little or nothing and receive a fixed amount every month, is unsustainable — too expensive for the state's taxpayers to bear. The plan is a model from another time — a Mercedes in a Subaru world. So long as the state under Mr. Malloy is committed to stabilizing the pension plan with taxpayer money, retirement benefits should be trimmed as well. That means that extravagances such as figuring overtime and longevity payments into pension benefits must fall by the wayside. Hundreds of retired state employees receive annual pensions of more than $100,000 in part because they ran up a huge number of overtime hours in their last years of state service. In some cases, taxpayers get hit twice because the work these soon-to-be-very-comfortable pensioners did could have been done by lesser-paid state employees on straight time. But even an end to overtime padding is not pension reform enough. Connecticut should switch from defined benefit pensions to defined contribution, or 401(k)-type, plans as the retirement benefit vehicle for future state employees, as Rhode Island and New York are contemplating. Experience in the private sector shows that these plans, which encourage employees to save for retirement, would be less costly for state taxpayers than traditional pension plans. Connecticut should head in that direction.

Retirement Security Good For Economy - Lori Pelletier - The Hartford Courant 30-January-2012 The writer is secretary-treasurer of the Connecticut AFL-CIO. on 2012-01-25 If we want a vibrant state economy, then workers need more retirement security, not less as The Courant opines in "Real Reform Of State Pensions [Jan 25]. Retirees with adequate pensions have money to spend in their communities and that, in turn, creates jobs. But only 13 percent of 76 million baby boomers are confident they have enough money to retire comfortably. Real retirement security has been undermined. To maximize profits, corporations have abandoned defined benefit plans for 401(k)s -- plans with little or no protection against market risk or outliving one's money. Despite this, The Courant wrongly advocates for 401(k)s for state employees whom they claim have "Mercedes"-quality pensions. Here are the facts. The average state employee pension is $27,000 -- hardly a Mercedes. Defined benefit pension plans are more cost-efficient for states, according to a study by the National Institute on Retirement Security. For every $1 contributed into public employee pension funds, there is a ripple effect of $4.05 in our state's economy resulting in 18,530 total jobs. Defined benefit plans serve employees and taxpayers well. Unless The Courant wants an economy that works only for the wealthiest 1 percent, it should advocate for retirement security for all.

State's colleges put on notice to stop raising tuition - By Jacqueline Rabe Thomas and Ana Radelat - The CT Mirror 30-January-2012 If President Obama has his way, the money that colleges receive from Washington will soon go to schools that can lower their tuition or at least hold it steady. That may be a problem for Connecticut's 17 public colleges, which have almost doubled tuition and fees over the last decade and have already approved tuition increases for the next school year that exceed the rate of inflation. Private colleges would also be affected by the president's plan. Under the current formula for federal student aid, schools with the highest tuition -- like Yale University and Trinity College -- receive the most money because the federal government is trying to fill the shortfall between what students can afford and their tuition costs. "We are putting colleges on notice -- you can't keep -- you can't assume that you'll just jack up tuition every single year. If you can't stop tuition from going up, then the funding you get from taxpayers each year will go down," Obama said Friday at the University of Michigan, where tuition and fees have increased by 14.5 percent over the past four years. The three federal grants that would be affected by the White House initiative -- Perkins, Work Study and Supplemental Educational Opportunity -- funnel $40 million to Connecticut's public and private colleges each year to help pay for school for 31,300 students. And if the state doesn't live up to the Obama administration's "affordability and value standards," which will be set in the next few months, much more money could be lost to schools down the road. Obama is hoping to get congressional approval to increase federal student aid from $3 billion to $10 billion. Robert A. Kennedy, president of the state's 100,000-student college system, is confident his colleges will not lose federal dollars and will be eligible for this new pot of money. "We don't need to fear that we are one of those institutions that has increased tuition too rapidly. ... Our increases have been modest," he said of the average 5 percent annual increase at the community colleges and Connecticut State Universities over the past five years. Officials from the University of Connecticut, who last month approved a plan to increase tuition by almost 30 percent over the next four years, were unavailable for an interview Friday. However, in an emailed statement, UConn President Susan Herbst said she thinks the school, which now costs $10,400 in tuition and fees for in-state students a year, is affordable. Some of the indicators U.S. Education Secretary Arne Duncan said his department will be looking at to determine if a college is affordable include the average amount of debt students leave with, how frequently students default on their loans, what the graduation rate is and the number of low-income students attending the school. In Connecticut, the default rate varies significantly among the institutions. The average amount of debt students leave college with is $25,360, which is 25 percent more than five years ago, according to the Project on Student Debt. But overall, Duncan said during a conference call with reporters, one of the best indicators is if tuition increases exceed the rate of inflation. "We don't think that's affordable," he said. Using the Consumer Price Index, Gov. Dannel P. Malloy's budget office sets inflation at 1.9 percent for the next fiscal year. UConn approved a 6 percent increase next year for in-state students, Connecticut State Universities, 3.8 and the community colleges, 3.1 percent. Private colleges have also raised tuition. Yale's tuition, room and board increased 5.8 percent this year, to $52,700. Trinity raised its tuition by about 3.8 percent last year and by about the same amount this year. Quinnipiac's tuition last year was $34,250 and $36,130 this year. Leveling tuition while states cut funding When Obama called on university officials to hold the line on tuition, the immediate reaction from many was to point out that most states have slashed their support of higher education. "Anything that smacks of price controls is a great concern on many levels, especially at a time when states are cutting their budgets," Molly Corbett Broad, of the American Council on Education, a national group representing college presidents, told The New York Times. Connecticut has cut funding to its colleges more than nearly every other state, according to the Center for the Study of Education Policy at Illinois State University. And on Tuesday, Malloy made additional emergency budget cuts in a number of areas, including an additional $5.4 million in reductions to the state's colleges. "State funding is decreasing and for us to maintain the status quo we had to increase tuition," Kennedy said. But he added that despite the additional decreases announced this week -- which follow an earlier 10 percent reduction to CSU this year -- the 3.8 percent hike that's already been approved will likely go no higher, he said. Susan Herbst, UConn's president, wrote in the emailed statement Friday that budget cuts are making it difficult not to increase tuition. "Universities are facing a tight squeeze between declining support and the need to maintain and enhance the quality of the education we offer," she wrote. Herbst noted that the increase in costs at UConn are linked to her promise to add 300 new faculty members in the next four years. As a result, she said, courses will be added so students will be better able to meet their requirements and graduate on time. "Remaining an undergrad for even one additional semester beyond four years substantially adds to the overall cost of a college education," she wrote. Just 60 percent of UConn students graduate in four years, according to the U.S. Department of Education. Malloy said during a call with reporters from an economic summit in Switzerland that he is confident that even with the state cuts and tuition increases, the state will not lose federal money. "I think Connecticut colleges are affordable," he said. He pointed to his recent initiative to cut the number of university administrators. "We are making it more affordable," he said. Duncan said that even a bleak budget picture is no excuse for states to cut funding. "It is a make or break moment for the middle class," he said. "States need to do their part to prioritize college funding... It's a shared responsibility, everyone has to step up." In his speech Friday, Obama also said he would institute a new "Race to the Top" program that would disburse $1 billion to colleges and universities that institute reforms like redesigning courses, making better use of technology and reorganizing how they spend money. Kennedy said the Regents plan to aggressively go after this money. "We have to do better," he said of the ever-increasing costs of education.

Malloy To Consolidate 7 More State Agencies - by Christine Stuart - CT News Junkie 30-January-2012 (Updated 2:06 p.m.) Gov. Dannel P. Malloy announced Friday that he will be consolidating seven more state agencies bringing the total number of state agencies from 59 to 52. The administration said it doesn’t know how much the consolidations will save the state, but it’s in keeping with Malloy’s desire to make government more efficient. “Last year we began the work of changing how the state does business—making government smaller, less costly, and easier to navigate,” Malloy said in a statement. “Like companies and families across the state and the country, state government must do more with less. This session we are continuing the effort to ensure government is working as efficiently as possible.” The consolidations will merge the University of Connecticut with UConn Health Center and the Office of the Chief Medical Examiner; the Department of Administrative Services will be merged with new Department of Construction Services; the Commission on Human Rights and Opportunities will be merged with the Office of Protection and Advocacy; the Teachers’ Retirement Board will be merged with the Office of the State Comptroller; the Department of Mental Health and Addiction Services will be merged with the Psychiatric Security Review Board; the Department of Labor will be merged with the Workers’ Compensation Commission; and the Connecticut Higher Education Supplemental Loan Authority with the Connecticut Health and Education Facilities Authority. Last year Malloy was successful in consolidating 81 agencies down to 59, but some of those consolidations came with pushback from stakeholders. The consolidation of the state colleges and universities under the Board of Regents and the consolidation of nine state agencies into the Office of Government Accountability caused outcry from various constituencies. It wasn’t immediately clear if any of the seven consolidations proposed Friday morning would cause any of the same pushback. It was also unclear how many non-union jobs may be eliminated as a result. Last year the state entered into an agreement with the state employees union, which included a no layoff clause for the next four years. There won’t be any immediate layoffs from the consolidations, but as vacancies emerge they won’t be replaced, Malloy said in a conference call from the World Economic Forum in Davos, Switzerland. The state also won’t need to hire a commissioner of the Department of Construction Services, since it will be merged with the Department of Administrative Services, “where it has been operating very successfully,” Malloy said. He said this is simply the second round of consolidations and didn’t rule out more in the future. The move comes after two weeks of bad and worse fiscal news for the state. From news that Moody’s downgraded the state’s bond rating, to an Office of Fiscal Analysis’ report which pegs the budget deficit at $145 million, Malloy seems to be doing everything he can to stop his first budget from ending the year in the red. The consolidations will be part of the budget adjustments Malloy releases Feb. 8 and they will need the approval of the state legislature. Malloy said news of the consolidations were just a part of his decision to continue rolling out his budget proposals in the weeks leading up to Feb. 8. “I’m in the business of saving billions of dollars for the taxpayers of Connecticut and cleaning up the mess that was left to me by my predecessors,” Malloy said. “And quite frankly, in some cases by acquiescence of the legislature.” Meanwhile, Malloy described his agenda in Davos as jam packed with events. He met with UBS this morning and has met with a handful of businesses, including one interested in bringing 1,000 jobs to the state, but was unable to give any more specifics. He also spoke with Arianna Huffington, editor of the Huffington Post, who he said was very excited about her company’s expansion in the European market. He guessed that Huffington was a regular at the event.

Business gearing up for legislative fight - By Greg Bordonaro and Brad Kane - Hartford Business 30-January-2012 State utility companies UIL Holdings Corp. and Northeast Utilities are loaded for a legislative battle this year, with 39 registered lobbyists, more than any other industry group, for the upcoming General Assembly session where storm preparation and outage response will be key issues. But the two utility giants aren’t the only companies and organizations that will be well-represented in Hartford during the legislative session starting Feb. 8. Connecticut’s largest interest groups from energy and health care to education and telecommunications have dozens of lobbyists registered to advocate for their interests, a Hartford Business Journal computer analysis of lobbyist registration data has found. UIL has the most registered lobbyists with 23, and NU is fourth with 16. Other groups with the most hired guns include the Connecticut Hospital Association (19), Connecticut Voices for Children (17), Connecticut Fund for the Environment (16), AT&T (16), the Connecticut Business & Industry Association (14) and the Connecticut Education Association (14), according to HBJ’s analysis of data from the Office of State Ethics. Connecticut’s lobbying industry is big business, with companies and organizations spending north of $36 million a year to ensure that their interests are well represented in Hartford. Even though 2012 is a shortened legislative session, the stakes are still high for many industry groups to shape public policy decisions. Building up a strong cadre of lobbyists is part of making sure their voices are heard, experts said. UIL, which acquired three natural gas utilities in 2010, wants to ensure that Connecticut makes proper investments to expand the natural gas infrastructure, company spokesman Michael West said. The utilities giant launched a campaign last year to switch potential customers from fuel oil to natural gas to heat their homes. But the biggest issue for the energy industry is the legislature’s consideration of possible new standards and penalties for utilities, resulting from major storms in August and October that knocked out power twice to close to 1 million residents. Some customers were without service for more than a week. Panels and reports examining the state and utility preparation and response to the storms have recommended everything from utility performance standards to infrastructure hardening to increased communication among utilities and government officials. “What legislation comes out of that, and what proposals come from that is the big question for us,” West said. NU, which faced the largest criticism for its subsidiary Connecticut Light & Power’s response following the October storm, declined to comment for this story. With 39 registered lobbyists, NU and UIL will make sure their voices are heard when the issues do arise. “There are so many moving parts that you don’t know what is going on at this point,” West said. West said UIL fielded a similar number of lobbyists last year when the big issue was energy policy reform. Of the 23 registered UIL lobbyists, 12 are active full-time in Hartford and the rest are in-house people called to testify on specific issues. Not all lobbyists registered with companies or organizations work for them on a full-time basis. In fact most don’t. Some lobbyists may be called to work on a single issue or testify for a particular company or organization, and in many cases lobbyists are registered with many different groups. Some of the registered lobbyists could also be leftover from 2011. Well-known Capitol lobbyist Jay Malcynsky of Gaffney, Bennett and Associates, for example, is registered to lobby for more than 30 organizations, state ethics records show, ranging from financial services firms to companies in the TV production and energy industries including NU and NBC Universal. “Lobbying has become a full-time career for an awful large number of people,” Malcynsky said. Other influence peddlers may not even step foot in the state Capitol. Administrative lobbyists, for example, spend their time at state agencies to influence the implementation of certain laws and regulations including things like permitting, grants, loans, bonds, licenses or contracts. Of the $37 million spent by organizations to influence Connecticut government in 2011, about 21 percent was allocated to administrative lobbyists, ethics data shows. In Connecticut, individuals or entities are required to register as a lobbyist with the Office of State Ethics if they spend or receive $2,000 or more in a year on lobbying services. The $2,000 threshold applies to various activities including expenses for research, reports, polls, media buys, activities fostering good will, or paralegal salaries. There are also different types of lobbyists. In many cases, organizations will hire outside lobbying firms, or business organizations, to do their bidding. In other scenarios, businesses will have their own in-house communicator, which is a salaried employee who lobbies. NU, for example, has registered 12 outside lobbyists, and four in-house communicators, state ethics records show. In recent years the state’s lobbying industry has been impacted by the economic downturn. Annual spending on lobbying services in Connecticut topped out at $41.9 million in 2007 but fell as low as $30.5 million in 2010, state ethics data shows. Those numbers are a bit skewed because organizations spend more on lobbying services in odd-numbered years when the legislature convenes for a longer six month session, said Carol Carson, executive director of the Office of State Ethics. Even still, 2010 marked the lowest spending levels in more than a decade. During 2011’s budget battle, when lawmakers sparred over how to tackle a $3.5 billion deficit, lobbyist spending totaled $36.7 million. Patricia LeShane, chief executive officer of Hartford-based Sullivan & LeShane, a communications firm whose services include lobbying, said some companies have pulled back on lobbying spending in recent years, but when issues arise that could impact their business they typically seek out representation in Hartford. “It’s a mixed bag in terms of spending,” LeShane said. “When there is a huge amount of interest on particular issues, there is increased activity.” LeShane said typically clients will sign one- or two year contracts for services, but the firm has long-term relationships with many organizations that bring in repeat business. Malcynsky, of Gaffney, Bennett, said even though Connecticut has a part-time legislature, lobbying has become a full-time job especially with the number of task forces, special committees and boards that have been created in recent years to tackle major issues on a year-round basis. Special sessions like the October jobs summit, also increases activity, forcing interest groups to stay informed throughout the year. With education being the top issue in 2012, it’s no surprise the state’s teachers union is gearing up. The Connecticut Education Association (CEA), which represents about 41,000 K-12 public school teachers, has 14 reregistered lobbyists. Other organizations involved with education, including the Connecticut Conference of Municipalities, New Haven Board of Education and Connecticut Collation for Achievement Now, each have six or more lobbyists registered with the state. Gov. Dannel P. Malloy has made education a top priority and there will likely be legislation to change teacher tenure, evaluation and dismissal rules as well as changes to the way state education funds are disbursed to school districts, raising the stakes for all of those involved. CEA spokeswoman Nancy Andrews said many of the organization’s staff are experts on policies such as school finance and teacher professional development, which will be major issues in the upcoming session. “CEA registered a significant number of staff members because they are collaborating with classroom teachers every day,” Andrews said. “We trust legislators will want to tap the teachers’ view on education reform that CEA staff know well.” The healthcare industry will also be well represented in Hartford this session. Besides the Connecticut Hospital Association, Cigna Corp., the Community Health Network of Connecticut, Connecticut State Medical Society, Yale New Haven Health System, Connecticut Association of Healthcare Facilities, and Hospital for Special Care each have seven or more lobbyists registered to do their bidding. Officials from the health care sector, which is traditionally the most heavily lobbied industry, say the ever changing legal and regulatory environment, as well as the financial pressures felt by many hospitals and doctor’s practices, make having their voice heard as important as ever. As Connecticut chooses how it will implement some of the sweeping changes mandated by federal health care reform, a lot is at stake for the industry, officials said. In particular, how Connecticut decides to implement its federally mandated health insurance exchange, which will serve as an online marketplace for individuals and small businesses to obtain insurance coverage, will have a major impact on hospitals, physicians and insurers. “It’s more important than ever that hospitals have an effective voice today,” said Michele Sharp, a spokeswoman for the Connecticut Hospital Association. “The complexities involved with care delivery — including patient access, coverage, technology, practice developments, reimbursement, [and] access to capital… in today’s hospital environment are extreme and increasing daily. Also at this time, hospitals are facing significant financial pressure, which is exacerbated by proposed cuts at the federal level and the implementation of healthcare reform.” In telecommunications, AT&T leads the way with 16 registered lobbyists. CSC Holdings, a subsidiary of Cablevision, has 12 registered lobbyists. Verizon Wireless has 10 and Comcast has seven. Besides storm related legislation, telecom officials say there are regulatory, consumer, technology, and local community issues that arise on a regular basis that impact their businesses in Connecticut. Ensuring that the state’s older regulations keep up with new modern technologies is also a continual battle. For AT&T, breaking down barriers to expand wireless broadband access will be a particularly important issue. “The process of making this technology available to consumers is cumbersome and in many cases made impossible by arbitrary rules, which restrict the building of new wireless sites,” said AT&T spokesman Chuck Coursey. “Connecticut should eliminate unnecessary barriers to investment and ensure that the rules providers must follow are fair and reasonable.” The Connecticut Business & Industry Association always has a sizable contingent at the state capitol. While 2012 will not address as many business issues as last year, the group still has 14 registered lobbyists as it seeks to push policies that cut the size and cost of government and regulatory red tape, and lower the achievement gap. South Windsor sport and concert ticket exchange TicketNetwork has nine registered lobbyists. The company has advocated for legislation giving more freedom to the secondary ticket market, making it easier for people to transfer and resell their tickets. The legislation would also force venues to disclose how many tickets they are releasing for the general public. Foxwoods Resort Casino in Mashantucket and Mohegan Sun resort casino in Uncasville each has about a half dozen registered lobbyists. The Native American-operated businesses advocate for their exclusivity contracts for casino gambling and address upcoming issues such as online gaming, Keno and off-track betting.

Shaving Pension Savings - BY PAUL HUGHES REPUBLICAN-AMERICAN 30-January-2012 HARTFORD — A new analysis says pension changes will save taxpayers $3.1 billion less over 20 years than the Malloy administration originally calculated. The legislature's budget office is estimating that the revisions approved last year will shave $1.7 billion from the state's annually required contribution to the state pension funds over the next two decades The Malloy administration had estimated that the savings would be $4.8 billion based on the calculations of actuarial consultants. Republican leaders said the new analysis is further proof that the reported savings from an agreement that Malloy and state employee unions reached last year do not add up. The administration continued to stand behind its estimates of the savings from the agreement, including the reductions in the annual contributions to the pension fund. The state's largest union did, too. Benjamin Barnes, the state budget director, said the legislature's budget analysts are not actuaries and their analysis is flawed. "I find it absolutely mind-boggling that the Republican leadership in essence continues to criticize a plan to stabilize the pension funds over the long term," said Larry Dorman, a spokesman for AFSCME Council 4, the state's largest union. Malloy and the unions negotiated a package of concessions and other cost-cutting ideas that are supposed to save $1.6 billion over the next two years and $20.5 billion over the next 20 years. The agreement made a number of changes to pensions, including increasing the age of retirement, creating a new pension plan for new workers and reducing cost-of-living adjustments. House Minority Leader Lawrence F. Cafero Jr., R-Norwalk, and Senate Minority Leader John McKinney, R-Fairfield, each asked the legislature's budget analysts to review the savings estimates. The nonpartisan Office of Fiscal Analysis reported back Friday that the pension changes should save $3.6 billion over the next 20 years. However, OFA analysts said only $1.7 billion of that figure can be attributed to the changes that the labor savings agreement made. They said investment income is a significant factor that is unrelated to the pension changes. Barnes said the OFA analysts are good, but lack the expertise of the actuaries who prepared the savings estimates for the administration. "Actuarial math is a little squirrelly and hard to understand," he said. Actuaries are highly trained statisticians who compute and analyze financial risks for insurance companies, governments, banks, investment companies and other businesses. They are used to design pension plans, for instance. Barnes also disputed some of the assumptions that the OFA analysts used. He said the analysis assumed the high level of investment gains over the last year would continue over the next 20 years. He contended that is unlikely to happen. Barnes did not dispute the $3.6 billion figure. However, he said long-term savings from retirements could easily make up the difference with the administration's estimate. He does not believe OFA reflects that in its analysis.. The administration had been expecting 1,000 retirements. Barnes said there were 2,600 retirements between Jan. 1 and Oct. 1, when pension changes took effect. McKinney said the OFA analysis underscores how Malloy and his administration have been overstating and misrepresenting the savings from the labor savings agreement. "This is just more bad news," Cafero said. A week earlier, Moody's Investor Service downgraded Connecticut's debt rating despite Malloy's efforts to reduce pension costs and balance the budget, saying the state's financial problems continue to stand apart from those of other states. The OFA analysis was also released two days after the legislature's budget analysts projected a $144.5 million deficit that is nearly twice the administration's estimate of $73.6 million. Senate President Donald E. Williams Jr., D-Brooklyn, defended the administration against the Republican criticism. "The Republican assertions of the death of state pension savings are exaggerated and incorrect. The OFA analysis that they are touting is incomplete and they know it," he said. Williams said the OFA analysts did not consult the administration's actuaries. He said the report states it is based on a preliminary valuation of the pension funds.

Legislative Analysts Say Malloy Won’t Achieve Pension Savings - by Christine Stuart - CT News Junkie 30-January-2012 (Updated 5:15 p.m.) The legislature’s nonpartisan Office of Fiscal Analysis concluded Friday that the state employee pension concession deal will fall about $3.1 billion short of the projected $4.8 billion in savings over the next 20 years. Republican lawmakers ,who requested the report, said it’s just more proof that Gov. Dannel P. Malloy’s administration is unlikely to achieve the $1.6 billion in union concessions over the next two years in order to balance the budget. That means the deficit will likely grow and he won’t be able to keep his campaign pledge to move to Generally Accepted Accounting Principles. Office of Policy and Management Secretary Ben Barnes said OFA’s report doesn’t prove anything because with all due respect to OFA, they’re not actuaries. “The House minority should refer questions about the actuarial funding of the pension plan to actuaries,” Barnes said Friday. “We have relied on the plan’s actuaries and we are confident in their findings, which show billions of dollars in long-term savings to taxpayers as a result of plan changes negotiated by the Administration last summer.” But the report comes on the heels of Malloy’s announcement Monday that he wants to dramatically change how pensions are funded. If the revised plan Malloy announced Monday before flying to Davos, Switzerland is adopted by the General Assembly, then OFA‘s numbers change. If the state decides to contribute more on an annual basis to the pension fund then those savings improve and the shortfall is only around $1.7 billion, according to the two OFA reports requested by Republican lawmakers. “If we compare this revised payment schedule to a baseline schedule included in supplemental actuarial information provided after the SEBAC negotiations, we arrive at a 20-year savings of $3.6 billion,” OFA said in its report. The projected savings to the state employee pension system under concession deal was estimated to save $4.8 billion over 20 years, but on Monday Malloy proposed increasing the amount the state contributes on an annual basis by about $125 million in the first year. Malloy said the goal was to improve the funding level of the pension fund to 80 percent by 2025, and 100 percent by 2032. Currently the pension system is funded at about 48 percent. Sen. Minority Leader John McKinney, who requested one of the reports from OFA, said it shows that a promise on one part of Malloy’s $1.6 billion concession deal falls short by $3.1 billion. He said if you look at the report and consider the changes Malloy announced on Monday then “I don’t think you’re adding apples-to-apples.” McKinney said the $4.8 billion in savings were savings he claimed were concessions by state employees. The proposal he made on Monday will require the use of taxpayer dollars, which means services will be cut or revenue will need to be raised in order to pay for it. “I have no doubt that putting in more money above and beyond your annually require contribution can help achieve savings over the long term,” McKinney said Friday during a visit to the press room. “Underfunding costs you more money in the long run, overfunding can save you money in the long run.” The difference according to McKinney is that Malloy said the savings were going to come from concessions from state employees, “not from more spending from the people in the state of Connecticut.” McKinney said he’s supportive of increasing the annually required contribution, but he’s not in favor of allowing it to be outside the spending cap. In addition to increasing the contribution to the pension fund Monday, Malloy suggested it fall outside the spending cap. “Given the budget deficits we have, given the spending increasing the Democrats and the governor gave us in their budget, we should live within the spending cap,” McKinney said. “If we deem it important for the long term fiscal health of our state to spend money into our pension fund above and beyond what’s annually required then we need to cut spending in other areas to do so.” House Minority Leader Lawrence Cafero, who requested a similar report from OFA, said it proves that the union concession deal and the purported savings are “fiction.“ “Just as in the other areas of the SEBAC deal concerning health care and other built-in savings, the pension fund savings are just one-third of what was budgeted,” Cafero said. “This is just more bad news.” But the administration is sticking by its numbers and is vowing the end the year in the black. “The Republicans can ask these questions any way they want, and they can use all sorts of interesting theatrics in the process, but the answer will always be the same thing: we are confident in OPM’s numbers and the calculations provided by the State’s pension plan actuary,” Barnes said. The unions seems to agree with the Malloy administration and believe the state will achieve the stated savings. “We reached an agreement in good faith with this administration that is providing significant savings to the taxpayer while ensuring the continuation of public services,” Larry Dorman, spokesman for AFSCME Council 4, said. Dorman said the Republican letter was a “thinly veiled attempt to turn public anger on state employees rather than come up with real solution to get this economy moving again.”

What's next for Occupy Wall Street? Activists target foreclosure crisis. - The Christian Science Monitor 30-January-2012 The Occupy Wall Street movement, which cut its teeth last fall by occupying streets and parks across the country, is moving into a new phase as it gears up for spring: occupying homes. The movement that claimed to speak for “the 99 percent” and made income inequality part of the national discussion now is organizing protests at housing auctions to support those affected by the foreclosure crisis. “At first, we were occupying parks, then homes,” says Sofia Teona, an organizer with Occupy Atlanta, of the movement’s evolution. “We are starting locally, but it’s a national movement.” Ten economic protests that changed history On Thursday, dozens were arrested when a group in New York interrupted a foreclosure auction in a courtroom, and Occupy organizers say more events are planned nationally in coming weeks. According to Michael Premo, an organizer for “Occupy Our Homes” in New York, the movement has carried out 50 similar actions nationally in the past month, including foreclosure disruptions, eviction defense actions, and home re-occupations. Although sales by banks of foreclosed houses were down in the third quarter of 2011, they still made up 20 percent of all homes sold. At the height of the housing boom in 2005 and 2006, that number was less than five percent. Foreclosure sales lower property values, and many economists don’t think that the economy will restart without dealing with the issue, says John Taylor, president and CEO of the National Community Reinvestment Coalition, a Washington-based nonprofit that urges banks to provide credit and investment capital to low-income communities. “I think that it’s good that they are focusing on something the average person can understand and something specific like foreclosures,” Mr. Taylor says of the Occupy activists. “It makes sense because foreclosures are the smoking gun. They are evidence of the malfeasance of predatory lending.” At the foreclosure auction in Brooklyn on Thursday, nearly 100 protesters started singing to disrupt bidding on foreclosed homes. Approximately 35 people were arrested, according to the National Lawyers Guild. A video of the event posted on the Internet shows the protesters singing slightly off-key and out of sync as some are arrested and led out of the auction. Websites organized by Occupy activists have sprouted up to help connect people across the country who are battling foreclosure, providing such information as where supporters can donate money. But some of the actions are very specific and center on saving one family home at a time. In one such case in Hawaii, a letter-writing campaign organized by members of a family to stay in their home has met with some limited success. Wells-Fargo, the bank that issued the loan, has agreed to let them stay until mid-February. Another case in Atlanta illustrates both the wrenching nature, and the complexity, of the foreclosure process. The Pittman family thought they were going to inherit the house that their grandmother had lived in since 1953. Instead, they are now occupying it. Eloise Pittman’s house in Atlanta was foreclosed on early last fall, but her family didn’t find out until shortly before she died in November. In 2006, Pittman, a retired school secretary whose only source of income was her retirement checks, refinanced her house and got a loan of $300,000, according to her granddaughter. Pittman couldn’t keep up with the high payments and she avoided telling her family. For the past 51 days, the Pittman family and members of the Occupy Atlanta movement have camped in a tent outside the house and stayed in the house to protest what they call Chase’s policy of predatory lending. A spokesman for Chase has a different story, saying the bank did not originate the loan. “We worked with Ms. Eloise Pittman in 2009 to modify her loan, and when her payments stopped in mid-2010, the foreclosure process started,” says Greg Hassell, a spokesman for Chase. According to Mr. Hassell, Chase is offering to let the family buy the house back for the market rate. According to the Pittmans, the bank offered the family two options. Either they pay $100,000 to keep the house, or else accept $2,500 to leave. They are choosing a third option – joining Occupy Atlanta to march to the bank to demand the deed back. “We are going to march to Chase to demand that they give back the deed,” says Carmen Pittman, Eloise Pittman’s granddaughter. “We won’t stop fighting until justice is served.”

Workers, families of patients, decry lockout at Milford's West River Health Care facility - By Brian McCready - New Haven Register 30-January-2012 MILFORD — Rosemarie Civitello of Milford is worried about the well-being of her 82-year-old mother, Rosalie Russello. Russello suffers from Alzheimers and is a patient at HealthBridge Management’s West River Health Care facility. Civitello said her mother relies on seeing familiar faces. But that all changed on Dec. 13 after HealthBridge Management locked 100 workers out of the Milford facility after numerous months of negotiations failed to yield a new contract. Temporary workers have been brought in to perform the work. “I’m majorly concerned,” Civitello said Sunday as she attended a candlelight vigil on the Green to raise awareness of the plight of the locked-out workers. More than 50 workers, residents and family members braved the cold and attended Sunday evening. “Things have plummeted horribly. The care has been affected,” Civitello said. Recently, Civitello went to visit her mother, who was sitting at a table with a few friends for lunch. A temporary worker asked the patients where they should go next. “I told her that isn’t my mother’s job,” Civitello said. “I took my mother to the recreation room.” She said patients have objected to the quality of the food, and are out of sorts after not seeing familiar faces working with them. Noreen Gates, of Milford, who has been an employee at West River for 20 years, said the lockout has left her feeling “devastated.” She’s been forced to collect unemployment for the first time ever and is losing $1,000 a month. “Why can’t we negotiate without being locked out?” Gates asked. “The company is trying to force a contract down our throats. They said we could come back if we forgo our pensions.” Barbara McFadden, of West Haven, who has been employed at West River for 10 years, said she feels “terrible” losing her job. She said besides losing money she has no health insurance. McFadden said she’s concerned about the patients and a lack of care. Continued... 123See Full Story The labor dispute has centered on health insurance and pension issues. Union officials claim the company wants to yank members’ pension plans in favor of an employer friendly 401K plan while requiring employees to contribute between $1,500 and $7,500 for health insurance. Management officials have previously disputed the union’s claims and said the pension plans would not be eliminated, but no additional monies would be placed into them. Additionally, management officials have said cuts in funding have necessitated concessions from the union including members paying some of their health care costs. Democratic Town Chairman Richard Smith, Alderman Frank Smith and state Sen. Gayle Slossberg, D-Milford, all attended the vigil Sunday to show support for locked out workers and patients. Slossberg, whose mother is in an assisted living facility, said she can’t imagine how her mother would feel losing her familiar faces who care for her. “The workers and the clients are like a family,” Slossberg said. “This lockout makes no sense and is wrong.” Union spokeswoman Deborah Chernoff said the vigil is a way of shining a light on the “real tragedy,” and that is workers who have been locked out of their jobs. “It’s had a significant impact on the residents and their families,” Chernoff said. “That’s why we’re doing this. They just want to go back to work. This wasn’t our choice.” She said the union asked a federal mediator to intervene and bring both sides back to the bargaining table. Currently, neither side has agreed to a date to negotiate as management has declined to accept dates offered by the union, Chernoff said. Earlier this month six affiliated Health Care Centers in Connecticut including the Milford based West River Health Care Center filed unfair labor practice charges with the National Labor Relations Board alleging the union refused to negotiate in good faith. In the complaint it alleged the union refused to attend more than 100 dates for bargaining, but union officials said at the time that they predict the labor board will find the complaint baseless. The six affiliated Health Care Centers include Danbury Health Care Center, Long Ridge of Stamford, Newington Health Care Center, West River Health Care Center, Westport Health Care Center and Wethersfield Health Care Center. Continued... 123See Full Story Michael Brown, of Milford, who attended Sunday’s vigil said he wants to support the locked out workers. “In my opinion the company feels that because the economy is doing so bad they can just push wages lower and lower as part of contract negotiations,” Brown said.

Government Cuts Kept U.S. Union Rate at Record Low in 2011 - By Holly Rosenkrantz and William McQuillen - Bloomberg 30-January-2012 The rate of union membership in the U.S. fell to a record low in 2011 for a second-straight year, as a loss of government jobs partially offset a rise in private- sector employees, the Labor Department said. Labor unions represented 6.9 percent of employees in private companies, unchanged from 2010 and down from 7.2 percent in 2009, according to data released today by the Bureau of Labor Statistics. The rate in the public sector was 37 percent. The total union membership rate -- reflecting both public and private-sector workers -- was 11.8 percent, down from 11.9 percent in 2010. The number of unionized workers went up by about 50,000, to 14.8 million. “We may have reached a level where the union numbers simply can’t decline anymore, but if you’re not expanding, how can you call yourself a movement?” Gary Chaison, a labor professor at Clark University in Worcester, Massachusetts, said in a telephone interview. “Unions simply can’t make any gains in the private sector because it’s so expensive to organize. In the public sector, the layoffs of teachers and firefighters are really where the labor movement is hurting.” Education Leads Workers in education, training and library occupations had the highest unionization rate, the Labor Department said. Among states, New York again had the highest union membership rate at 24 percent, while North Carolina had the lowest, at 2.9 percent. The report also showed the average weekly earnings of union workers was $938, while non-union workers were paid $729. In 1983, the first year the agency collected the data, 20.1 percent of the U.S. workforce and 16.8 percent of company workers were members of a union. The number of private-sector workers who are represented by a union rose to 7.2 million from 7.1 million last year, while in the public sector it fell 61,000 to 7.6 million. “Despite an unprecedented volley of partisan political attacks on workers’ rights and the continuing insecurity of our economic crisis, union membership increased slightly last year,” Richard Trumka, the AFL-CIO’s president, said in a statement. “It is telling that our country begins to recover the jobs lost during the Great Recession, good union jobs are beginning to come back.” The number of government workers fell to 20.5 million, from 21 million, the Labor Department said. The number of union workers who are black increased slightly, to 1.92 million, or 13.5 percent, from 1.89 million, or 13.4 percent. The number of Latino union workers rose about 6,000 to 1.82 million, though their percentage of the workforce fell to 9.7 percent from 10 percent as nearly a half million more Latinos were employed, according to the Labor Department statistics.

Union membership grew nationally in 2011 - By Marc Lifsher - The Los Angeles Times 30-January-2012 U.S. labor unions picked up 49,000 new members in 2011. Young people between 16 and 24 years old accounted for almost a third of the new jobs, the country's biggest labor federation, the AFL-CIO, reported Friday. "Good union jobs are beginning to come back," said AFL-CIO President Richard Trumka, "despite an unprecedented volley of partisan political attacks on workers' rights and the continuing insecurity of our economic crisis." Overall, unions gained 110,000 new jobs in the private sector last year. Part of that gain was offset by the loss of 61,000 public sector posts. Union members accounted for 37% of public sector positions, up slightly from 36.2% in 2010. However, they represented just 6.9% of private employment in both years, the AFL-CIO said. The biggest gains in union membership were in construction, healthcare services, retail trade, primary metals and fabricated metal products, hospitals and transportation, the union said, citing U.S. Bureau of Labor Statistics data.

Union Membership Rate Fell Again in 2011 - By STEVEN GREENHOUSE - The New York Times 30-January-2012 The nation’s union membership rate continued a decades-long slide last year, falling to 11.8 percent of the American work force in 2011, the Bureau of Labor Statistics announced in a report on Friday. That was down from 11.9 percent the previous year even though total union membership edged up, rising by 49,000 last year to 14.76 million. The overall membership rate declined because the increases in organized labor’s ranks did not keep pace with overall growth in employment. The bureau announced these numbers as the nation’s labor unions have been coming under heavy political attack. Republican governors and Republican-controlled legislatures in Wisconsin and in several other states have pushed to curb the power of public employees to bargain collectively. Moreover, Indiana is poised to become the first state in more than a decade to enact a “right to work” law, which bans employers and unions from agreeing to contracts that require workers to pay fees for union representation. According to the bureau, 16.3 million workers are represented by unions, some 1.5 million more than the total membership, indicating that many workers opt out of joining the unions that represent them at their workplaces. The percentage of public sector workers in unions was 37 percent last year, more than five times the 6.9 percent membership rate for private sector workers. In the 1950s, more than 35 percent of private sector workers were in unions. The Bureau of Labor Statistics said the number of private sector workers in unions increased by 110,000 to 7.2 million, buoyed by a rebound in manufacturing and construction employment. But with many states, cities and school districts laying off employees, the number of public sector workers in unions dropped 61,000, to 7.56 million. The bureau found that New York State had the highest unionization rate, 24.1 percent, followed by Alaska (22.1 percent) and Hawaii (21.5 percent). North Carolina had the lowest rate, 2.9 percent, with South Carolina second-lowest (3.4 percent). The data was collected in the Current Population Survey, a monthly survey of 60,000 households.

Real Reform Of State Pensions: Switch To 401(k)s - The Hartford Courant 25-January-2012 Before hopping a plane to Switzerland and a seat at the World Economic Forum this week, Gov.Dannel P. Malloyasked the legislature to OK a $125 million payment into the pension plan for state workers as part of an effort yet this year to make the pension plan — now funded at an anemic 48 percent — cover all liabilities by fiscal 2032. The sorry state of Connecticut's pension plan isn't Mr. Malloy's fault; the underfunding damage was wrought before he was governor. And Mr. Malloy's pension proposal is fine as far as it goes. It helps to answer the objections ofMoody'sInvestors Service, which downgraded Connecticut's credit rating a notch last week in part because the state has "pension-funded ratios that are among the lowest in the country and likely to remain well below average." But the governor doesn't go nearly far enough in prescribing pension-reform remedies. And Mr. Malloy doesn't specify exactly where he's going to get the $125 million to deposit in the pension plan at a time when the state budget faces the possibility of deficits this fiscal year and in the next one because of lagging revenues. But there's a more fundamental problem. Connecticut's old-fashioned "defined-benefit" pension plan, to which employees contribute little or nothing and receive a fixed amount every month, is unsustainable — too expensive for the state's taxpayers to bear. The plan is a model from another time — a Mercedes in a Subaru world. So long as the state under Mr. Malloy is committed to stabilizing the pension plan with taxpayer money, retirement benefits should be trimmed as well. That means that extravagances such as figuring overtime and longevity payments into pension benefits must fall by the wayside. Hundreds of retired state employees receive annual pensions of more than $100,000 in part because they ran up a huge number of overtime hours in their last years of state service. In some cases, taxpayers get hit twice because the work these soon-to-be-very-comfortable pensioners did could have been done by lesser-paid state employees on straight time. But even an end to overtime padding is not pension reform enough. Connecticut should switch from defined benefit pensions to defined contribution, or 401(k)-type, plans as the retirement benefit vehicle for future state employees, as Rhode Island and New York are contemplating. Experience in the private sector shows that these plans, which encourage employees to save for retirement, would be less costly for state taxpayers than traditional pension plans. Connecticut should head in that direction.

Malloy orders $79 million in emergency budget cuts - By Mark Pazniokas and Keith M. Phaneuf - The CT Mirror 25-January-2012 Gov. Dannel P. Malloy used his emergency fiscal authority Tuesday to cut nearly $79 million in spending, pushing the budget deeper into the black and preserving his conversion of finances to Generally Accepted Accounting Principles, which Malloy says is necessary for honest budgeting. Malloy's use of his emergency powers to keep his first budget in balance is an unwelcome development for a governor trying to put a fiscal crisis behind him, but he cast the action as a relatively modest correction after a year of tumult. "Last year we were on the brink of the abyss with the largest per capita deficit in the nation," Malloy said at his monthly meeting with agency heads, which was open to the media and televised live on CT-N. "Today we're talking about less than one-half of 1 percent. Put it in perspective." Benjamin Barnes A year ago, Malloy was confronting an inherited deficit of $3.67 billion. But House Minority Leader Lawrence F. Cafero Jr., R-Norwalk, said he believes the cuts are the first of many Malloy will have to make to address a weakening revenue picture. "This I'll give him credit for, I think he is trying to get ahead of it," Cafero said. More than one-third of the cuts, or $28.4 million, will come from the Department of Children and Families, with the Department of Mental Health and Addiction services getting the next biggest hit, $14.5 million. In a year that Malloy says will be dedicated to education reform, he is cutting the Department of Education by $3.2 million. The DCF cuts will be blunted by policy changes already in the works. For example, the agency is slated to lose $15.3 million for residential and foster care services, but it decided months ago to keep more children living with their families. When a child does need to enter DCF custody, the agency avoids placing them in large group facilities. Other states that have followed this approach have reported much more in savings once the strategy was fully implemented, according to the Anne E. Casey Foundation, a national child welfare advocacy group that is working closely with DCF. Virginia saved $100 million a year. Benjamin Barnes, the governor's budget director, said they also will save $10.5 million by keeping vacant positions at DCF open and reconfiguring contracts with private providers. "We believe that we can accomplish this through adjustments in those contracts through holding back money," Barnes said. "We are going to be squeezing contractors." That raised some alarms for Terry Edelstein, the leader of the Connecticut Community Providers Association. She said, "I would argue we're already squeezed." Department officials have said they plan to begin rolling accountability measures into their contracted services with private providers, and that they will no longer pay for services that aren't producing the desired results. The rescissions, or cuts, detailed Tuesday will mean delays in filling vacant positions, with a high standard to be met to make new hires: public health and safety must be at stake, or the position is necessary to gain or sustain revenue greater than the cost of the position. The executive branch will be responsible for $72.1 million of the cuts, with $5.76 million coming from the judicial branch and $800,000 from the legislature. Malloy, who nominated six judges to the Superior Court last week, said the court will have to live with about 17 other judicial vacancies. The order was not unexpected. Barnes warned last week that the administration would order emergency cuts after new projections showed the $88 billion surplus built into this year's $20.14 billion budget had all but vanished. The administration estimated on Friday that the surplus had plunged to a paper-thin $1.4 million, equal to 1/134th of 1 percent of the general fund. That has been driven largely by declining state tax projections. A consensus revenue report last week from executive and legislative branch analysts showed income tax projections alone are down more than $169 million from the revenue forecast in the adopted budget, but that loss was offset somewhat by gains in sales and wholesale fuel tax receipts. Existing law grants the governor limited authority to unilaterally rescind allocations in many line items by up to 5 percent, though municipal aid cannot be touched, and the state's share of funding for Medicaid, an entitlement, cannot be reduced without federally approved changes in coverage. Malloy said the cuts ordered Tuesday don't reflect the maximum reduction he could have made, adding that further rescissions could be ordered if the budget picture worsens before the fiscal year ends June 30. But Barnes warned that the rescissions themselves could present a fiscal challenge down the road. That's because this year's budget also hinges on the Malloy administration's finding more than $831 million in unidentified savings, or lapses. Barnes' office already has developed a schedule assigning a share of that overall lapse target to most agencies. Barnes said some of the rescissionary cuts "overlap" with efficiency measures agencies already had planned to meet their lapse responsibilities. This means those departments must find new ways to save money. Barnes was unable to say precisely how much of the cuts proposed Tuesday would come from lapses, but Senate Minority Leader John McKinney, F-Fairfield, said it could be more than half. "While I intend to take an exhaustive review of the proposed rescissions by the Malloy administration, we need to make sure his numbers add up. After an initial review by my staff, it appears that as much as $41.7 million of the governor's proposed rescissions have already been identified as lapses," McKinney said. Barnes also warned that the administration likely would scale back plans to fill vacant positions across state government. More than 2,600 state workers elected to retire from state service between January and Oct. 1, 2011 -- more than two-and-a-half times the number of retirements recorded over the same period in 2010. The 2011 total was driven largely by new restrictions in retirement benefits that took effect Oct. 1, according to the concessions deal negotiated by Malloy with state employee unions. "We're not slowing down rehiring of vital positions because we want to," Malloy said. "We're doing it to be prudent." Roderick L. Bremby, the commissioner of social services, said he doesn't expect the higher standards to get in the way of his request to hire more than 100 new workers. Barnes agreed that the request would likely meet the higher standards -- "to some degree." "I'm certain that's a critical priority given the troubles that we've had with administering some of the federal programs," Barnes said. DSS is seeking to hire 134 new workers, 120 of whom would be responsible for handling eligibility for the wide range of programs the department administers. The department has come under fire for problems in handling program applications in recent years. Legal aid lawyers sued the department earlier this month, blaming understaffing in the department for delays in processing Medicaid applications. The department is also facing potential federal sanctions for problems in processing applications for the Supplemental Nutrition Assistance Program, formerly known as food stamps. DSS received approval to refill 52 eligibility positions that became vacant when workers retired last fall and is in the process of hiring people. Overall, state agencies received approval to hire about 1,000 workers to refill jobs left open after retirements last fall, but only about 250 of those jobs have been filled. Barnes said jobs "absolutely necessary" to ensure compliance with state or federal law or a court order would be approved. Bremby said he believes the department's request for additional workers -- which would be in addition to the 52 already authorized -- meets the criteria Barnes set. The Democratic governor absorbed some criticism last week from Republican legislative leaders, who noted that the shrinking surplus would leave Malloy unable to continue his GAAP initiative. GAAP rules are a series of common financial guidelines established by the Government Accounting Standards Board to emphasize transparency. Unlike the modified cash basis state government has long used, GAAP rules require that funds be on hand to cover expenses as they are incurred. Similarly, revenues are counted in most situations in the year in which they are received. The Malloy administration estimated in its Fiscal Accountability report in mid-November that state government would need another $1.7 billion in its coffers to cover all its obligations under GAAP rules. And that differential grows annually with inflation. The governor pledged to use the first $75 million of any surplus this fiscal year to cover that inflationary cost and stop the GAAP differential from growing. When the budget was adopted in June, Malloy signed language that allowed him to delay the first of 15 annual payments to eliminate that $1.7 billion differential until 2014.

Other Connecticut cops worry they’ll be viewed the same - By William Kaempffer - The New Haven Register 25-January-2012 There are 36,000 cops in New York City and some, at any given time it stands to reason, are breaking the law — like in any other profession. But, “It’s dangerous to paint the police profession with a broad brush because there are so many cops out there doing their job every day,” said former Branford police chief and University of New Haven professor John DeCarlo. “I think the vast majority of cops are out there doing a very good job based on the principal of wanting to help people,” he said. That doesn’t mean the arrest of four East Haven officers on federal charges Tuesday wasn’t on the collective minds of other officers who fear they will be looked at through the same lens. “Obviously, it certainly doesn’t help our relationship with the community,” said one New Haven officer, who didn’t want to be identified because he wasn’t authorized to talk to the media and didn’t want to speak out against fellow officers. “It’s tough. It’s a horrible thing to be facing and you have to remember they’re innocent until proven guilty,” he said. That said, he acknowledged some segments in the community would judge all cops by the alleged actions of a few. “People still bring up Billy White once a week,” the officer said. The East Haven officers allegedly for years singled out Hispanics, assaulted people while handcuffed, illegally searched Latino businesses, and harassed or intimidated people, including alleged victims, witnesses and even other police officers, federal authorities said. New Haven endured its own scandal when three officers, including the decorated head of the narcotics squad, Lt. William White, were arrested, pleaded guilty and were sent to prison for allegedly framing one man on drug charges and stealing money planted by the FBI in a sting. Continued... 12See Full Story The ultimate fate of the four East Haven officers remains an open question. William Klein, of the Police Officers Training and Standards Council, which certifies all state police officers, said any officer being convicted of a felony would trigger a decertification process. Thomas E. Flaherty, the POST director, and former Milford police chief, stated he couldn’t comment on the East Haven case because the issue could come before the council. He did say that officers trained in any state-certified academy receive extensive training in laws regarding profiling. “Every major block of instruction here at the academy talks about ethics, integrity and honesty, and those areas are reinforced in laws of arrest, search and seizure, motor vehicle enforcement and motor vehicle law, criminal law and juvenile law,” he said. Federal authorities arrested two of the officers at East Haven police headquarters during their shift and two at their homes. Stanley Twardy, a Stamford defense attorney who served as U.S. attorney in Connecticut, noted that the U.S. attorney’s office recently has been more aggressive in arresting individuals rather than having them “self-surrender.” “I can’t draw any conclusion from that. It may be a way for the U.S. attorney’s office to show that police officers aren’t above the law.” Another veteran New Haven police officer said he won’t change his style of policing. While not perfect, New Haven is a melting pot with a much more diverse department, which leads to a different perspective for officers. “There’s a lot of diversity in the department. There’s a lot of diversity in the city, and I think that helps eliminate racial profiling. East Haven doesn’t have that,” he said.

Super PAC says it's leveling playing field; unions disagree - By Jessica Yellin, CNN 25-January-2012 Washington (CNN) -- Are American Crossroads and Crossroads GPS comparable to labor unions and MoveOn.org? Democratic activists scoff at the question. But Steven Law, Crossroads' CEO, says yes. "American Crossroads was conceived as an answer to the hundreds of millions of dollars that unions and MoveOn.org and other groups on the left have been spending for years to support Democrats," Law said. "So we started American Crossroads because we thought there ought to be a way for us to try and level the playing field." Adam Ruben, political director for Moveon.org, says it's a fundamentally different approach to political engagement. "Their money is secret. It comes in seven-figure chunks. That gives them a fundamentally different role in our democracy," Ruben said, explaining that Moveon.org's average donation is $28. "A group that exists for ultra-rich people to essentially buy elections is counter to the American democratic tradition." The labor unions that invested the most in the 2010 elections say they collectively spent $177 million on political activities (the American Federation of State, County and Municipal Employees: $93 million; the Service Employees International Union: $44 million; the National Education Association: $40 million). In the same cycle, the top three Republican outside spending groups spent $147 million on political activities (American Crossroads and GPS: $71 million; the U.S. Chamber of Commerce: $50 million; the American Action Network: $26 million). In terms of dollars spent, labor unions are competitive. But it's worth looking at the differences between the groups and how that affects their disclosure laws. American Crossroads and Crossroads GPS are divided because one is public and one is private. American Crossroads, the super PAC, can raise unlimited amounts but has to declare its donors. It can make hard-hitting, explicitly political ads. The private arm is Crossroads GPS, a 501(c)(4) organization that doesn't have to disclose its donors. This group has to live by different rules. More than half of its ads can't be explicitly political; they have to promote a specific issue. Since GPS is private, the IRS is the only government agency that monitors its activity. Labor unions raise money for political spending through voluntary contributions from members to their PACs and use money from their general fund that comes from dues. They are not required to report all their political spending to the Federal Election Commission. But the Bush administration's Department of Labor passed far-reaching rules requiring that they disclose all their political giving, so their election-related activities are public. But those aren't the only differences. Labor union representatives argue that the two Crossroads groups spend their money overwhelmingly on ads, not on get-out-the-vote efforts and advocating for safer work environments, which, union representatives argue, enhance democracy. Representatives from Crossroads say they are experimenting with new ways to get out the vote online and through technology but acknowledge that it doesn't approach the boots-on-the-ground power the unions have. GPS also spends money supporting other groups that share its less-regulation/lower-tax agenda, which they believe also contributes to society but from a different political perspective. Still, union representatives scoff at any comparison on principle. American Federation of State, County and Municipal Employees political director Larry Scanlon said, "Karl Rove has taken advantage of campaign finance loopholes to create a shadowy network of front groups that can raise and spend unlimited, undisclosed funds to promote anti-worker candidates and an issue agenda that attempts to silence the political voice of working people. "Conservative groups like Crossroads outspent liberal ones by a 2-1 margin in the 2010 cycle and are poised to spend even more in 2012. In contrast, everything AFSCME spends on behalf of its 1.6 million members is above board and disclosed. We will never match what the corporate interests and wealthy individuals spend, but we have the facts on our side, and we have real live people, not Mitt Romney's 'corporate people,' on our side." But Law maintains that Crossroads is "very open" about its activities. "We're very proud about what we do. We pursue what we're doing ethically; we have a strong agenda of good policies we think are good for the country, and we want to be very open about how we're doing it and what we're doing and where we're doing it," Law said. That 2-1 spending figure is based on a study by Open Secrets.org at the Center for Responsive Politics. Open Secrets gathers its numbers only from reports to the Federal Election Commission, which does not capture all election spending. "Labor unions are allowed to engage in a variety of politics-related activities that don't meet the definitions of what gets reported to the FEC," Open Secrets said. "The numbers on OpenSecrets.org could be more conservative than what the unions themselves say they spent." Paco Fabian, spokesman for Change to Win, a coalition of labor unions, disagrees. "The comparison is laughable. You have, on the one hand, a handful of billionaires and corporations fund Crossroads and Crossroads GPS. They are the voice of the 1 percent. On the other hand, you have millions of workers coming together and supporting a handful of unions, the voice of the 99 percent. Union members have ensured that all American workers labor under safe conditions, with fair pay and benefits for a hard day's work. That's why we have weekends." Super PACs and 501(c)(4)s are not limited to the right. Democrats have them, too. There's a crop of new Democratic super PACs: Majority PAC, House Majority PAC and Priorities USA, which as of last filing had not been able to raise nearly the money the Republican PACs have. Law is unfazed by the criticism, saying, "Nobody thought that was controversial when they're helping Democrats. You know, now we're leveling the playing field somewhat, and obviously Democrats are upset about that." This is the first presidential election since the Supreme Court ruled in Citizens United that corporations can make unlimited gifts to all of these groups, making it a test run for a potentially new era of big money in politics. The next filing deadline for the FEC is January 31, so we'll learn more about how much money has been raised then -- at least for those groups that have to report.

90 Employees Under Investigation, 4 Fired, & 4 Retired - by Christine Stuart - CT News Junkie 25-January-2012 Four employees have been fired and four have opted to retire as a result of the state’s ongoing investigation into the post-Irene food stamp fraud, Gov. Dannel P. Malloy told his commissioners Tuesday. In addition, 90 more state employees are in various stages of disciplinary hearings and 686 state employees have been cleared of any wrongdoing because they properly qualified for the disaster assistance. “That means the vast majority of state employees who received these federal benefits were honest and reflect the vast majority of state workers as a whole,” Malloy said. The Department of Social Services is expected to complete its review of applications by the end of business on Wednesday and refer any more cases to state agency heads for disciplinary action. “I want you to know that you must move forward with these matters in a timely fashion,” Malloy told his commissioners. “These cases can not languish in your departments.” After finishing the review of more than 800 state employee applications the state is moving forward with a random sampling of applications from private citizens— a measure that’s beyond what the federal guidelines for the program require. A total of 23,726 households and 74,230 individuals received the federal disaster assistance from the state. Malloy also advised his commissioners Tuesday that no names of the terminated employees were allowed to be released. Malloy’s Chief Legal Counsel Andrew McDonald has said the state’s Freedom of Information statutes would normally require the state to disclose the information, but statutes governing the privacy of food stamp applicants prohibit the state from releasing the names. McDonald referred the matter last week to the Attorney General’s Office where Assistant Attorney General Mark Kohler concluded the names couldn’t be released In an informal letter to McDonald Kolher said “nondisclosure of this information is not just a matter of important state policy, but is required by federal law.” He said unless a court finds otherwise “prudence dictates that no disclosure be made.” Rich Rochlin, the attorney who represents two of the terminated state employees, said it may be the first time he agrees with the administration. “Yes he’s giving good advice on that,” Rochlin said Tuesday evening in a phone interview. Rochlin represents about 20 state employees accused of food stamp fraud and he maintains each filled out the forms as they were instructed to by Department of Social Services staff. Rochlin said he thinks even the two terminated employees have strong cases and he looks forward to going through the grievance process. The Office of Labor Relations will schedule a hearing in each of the cases within the next 21 days. Rochlin said he believes his clients will be vindicated once they’re allowed to share their side of the story with a non-political entity like the Office of Labor Relations.

GOP Senators: Take Overtime Out Of Pension Calculations - By JON LENDER - The Hartford Courant 25-January-2012 Two Republican state senators called Tuesday for passage of a bill this year to take pensions for future state employees out of union negotiations and to stop employees' widespread practice of "padding" of their pensions with heavy overtime as they prepare to retire. But a spokesman for Democratic Gov. Dannel P. Malloy said later that the administration would not support the proposal in the legislative session scheduled to open Feb. 8. A contract settlement reached by the administration with state unions last year leaves much the same basic pension structure in effect until 2022, including counting overtime in the calculation of pensions. At a press conference in Hartford, state Sens. Andrew Roraback of Goshen and Jason Welch of Bristol cited information from recent Courant stories as evidence for why pension rules should be changed for employees hired after July 1, 2012. Roraback, who also is a candidate for the 5th District Republican congressional nomination, focused his remarks on "hazardous duty" employees such as police, correction officers and prison nurses — who get to retire after 20 years no matter what their age, with pensions amounting to half their top average salary in their three highest-paid years; overtime is included in the pension calculation. They get 70 percent of that salary average if they work 30 years. Referring to disclosures in several Courant Government Watch columns from 2011, Roraback said, "When we read about [prison] nurses … who rack up overtime of $94,000 on top of a base pay of $105,000 — or when we read of the UConn police chief [announcing that he'll be] retiring with a salary of $255,000, and a deputy chief retiring with a salary of $200,000, do the math. … Four of the hazardous-duty employees who retired in this last [2011] wave of retirements are earning more … in their retirements [because of overtime-spiked salaries] than they did in their base pay." Roraback said his bill would remove pensions from collective bargaining for employees hired after July 1, which means no existing workers' rights would be affected. He said state workers' pensions in New York, New Jersey, Rhode Island and Massachusetts are not set through collective bargaining. He said the GOP bill also would remove overtime and longevity payments from pension calculations for those employees, and would require them to be enrolled in 401(k) benefit plans. He said the pension plan is woefully underfunded — "we're facing more than $71 billion in unfunded retiree obligations." And even though Malloy on Monday proposed adding another $125 million in funding for the pension plan, Roraback said, "better funding is not enough to get Connecticut out of the pickle we're in. … We have to change the rules with respect to our pensions." He said the hazardous-duty employees are good, hard-working people, but the rules invite abuse. "The people that are gaming the system are not bad people. They're rational people, not bad people. We have a bad system. And what we're aiming to do is to make it a good system." Malloy's senior adviser, Roy Occhiogrosso, said later Tuesday that "The Malloy Administration reached an agreement last year with state employees that will save Connecticut taxpayers $21.5 billion over 20 years. That agreement covers these issues, and Sen. Roraback knows that." He said the GOP idea is "not a real proposal." Last year's deal with employee unions modifies pension calculations somewhat, but leaves overtime payments in the formula. Also critical of the Republicans' pension proposal as Larry Dorman, spokesman for Council 4 of the American Federation of State, County and Municipal Employees. Dorman has also been a spokesman for the state employees unions' bargaining coalition with which the Malloy administration struck last year's deal on benefits including pensions. Said Dorman: “Senator Roraback should be focused on making retirement security a possibility for more workers instead of taking away public employee pensions. State employees just made significant concessions to fix a problem caused by Republican governors kicking the can down the road on the state’s financial obligations and then pointing the finger of blame at middle-class workers. His proposal to replace defined benefit pensions with 401(k)s is economically foolish and politically extreme for someone with aspirations to serve in Congress.”

Republicans Pitch Their Own Pension Changes - by Christine Stuart - CT News Junkie 25-January-2012 One day after Gov. Dannel P. Malloy promised to contribute more money to the woefully underfunded state employee pension system, Republican Sens. Andrew Roraback and Sen. Jason Welch made a controversial pitch to change how state employees negotiate their pensions. At a Capitol press conference Roraback and Welch said they want to remove pensions from collective bargaining for all new state employees and they want to change how pensions are calculated by lowering the amount of overtime and longevity included in those final calculations. The later was pitched by Malloy himself after the first State Employees Bargaining Agent Coalition agreement vote failed this summer. Determined to whittle away at the state’s unfunded pension liability without $1.6 billion in concessions from the labor unions, Malloy proposed changing how pensions are calculated. The legislation passed the Senate, but never made it to a vote in the House. The bill Malloy proposed focused largely on eliminating longevity payments for state employees not yet eligible for them and freezing longevity payments for those already receiving them. It would have also changed the definition of “salary” for pension calculations in order to exclude overtime, longevity, fees or any other payment after the contract expired in 2017. The current SEBAC agreement which was finally approved in August doesn’t expire until 2022. “We already have an agreement,” Malloy said Tuesday when asked if he would support changes to pension calculations. “We’re not in a position to make a meaningful change.” In Connecticut state employee unions bargain for their pension benefits with the governor’s office. None of Connecticut’s neighboring states allow unions to bargain for their pension benefits and many according to Roraback have moved to 401k type plans and away from defined benefit plans. “Is he running for office?” Malloy asked of Roraback. Roraback is one of several candidates running for the Republican nomination in the 5th Congressional District, but held the press conference Tuesday in his capacity as a state senator. Roraback said allowing the legislature to make these types of changes now makes sense and it improves the viability of the pension fund for those employees already contributing. “If they adopt this change, it will make the pension stronger for existing state employees,” Roraback said. “It will prejudice no one because new employees will know the rules under which they are being hired.” Sen. President Donald Williams, D-Brooklyn, said he hadn’t seen Roraback’s proposal but would be happy to look at. However, he said the state already has a binding contract with its state employees. “It’s my understanding that collective bargaining agreements as to pension are stretching for another five or six or seven years,” he said. “My guess is that those folks would still be covered under the existing collective bargaining agreements, but I’d have to see Sen. Roraback’s proposal to understand it better.” Rorback argued there’s no time like the present to tackle these issues. “We have a structure in our retirement benefits, which is clearly unsustainable,” Roraback said. He cited the recent decision by Moody’s to downgrade Connecticut’s bond rating, a result of having one of the worst funded pension system in the nation. “Moody’s cited the need for more substantive pension changes than what Governor Malloy negotiated with state employees or has so far proposed,” Roraback said. “While aggressively paying down our long-term pension obligations should be a priority for state government and is good fiscal policy, it must be done within the context of a budget Connecticut’s taxpayers can afford.” On Monday Malloy proposed increasing the amount of money the state contributes to the state employee pension fund to ensure it’s fully funded by 2032. Roraback said while that sounds good closing the loopholes in the current system, which currently pays 376 retired state employees more than $100,000 a year, would eliminate the need to dedicate large sums of money to pensions in the future. “It is unfortunate that Governor Malloy, after blaming past Governors for tying the state’s hands with a long term pension contract, actually extended that contract into the next decade,“ Roraback said. “And it is unfortunate that after criticizing the gross inflation of pensions through overtime abuse, the governor completely failed to address the issue in his contract with state employee unions.” Roy Occhiogrosso, Malloy’s communications adviser, said the governor believes deeply in the collective bargaining process and the deal he negotiated with the state employees will save taxpayers $21. 5 billion over 20 years. He said Sen. Roraback knows these proposals and knows they’re covered in the collective bargaining agreement. Roraback maintained he will be able to find bipartisan support for his proposals, but he won’t find the support of state labor unions. Larry Dorman, spokesman for AFSCME Council 4, said the issue is a “non-starter” with the unions since they already reached an agreement with the Malloy administration that saves the state millions of dollars. “This just proves Roraback is out of touch with the reality of working class people,” Dorman said. “That doesn’t bode well for his Congressional bid.” He said 401k plans are savings plans which are difficult to administer while the defined benefit plan state employees have is a retirement plan. He said instead of looking to take benefits away from people Roraback should concentrate on making sure everyone has a good retirement plan.

Mitch Daniels, the State of the Union address and deficit realities - By John Tomasic - The Colorado Independent 25-January-2012 Popular Indiana Governor Mitch Daniels has been chosen to deliver the Republican response to President Obama’s State of the Union address tonight. Ideas about how best the government might respond to the limping economy and tackle the enormous federal budget deficit are sure to feature prominently in both speeches. Daniels comes to such a discussion with baggage, however, having headed the Office of Management and Budget under George W. Bush from 2001 to 2003, when the country’s projected budget surplus of $236 billion ran down a sink hole where it became a $400 billion deficit. The Bush years, defined by tax cuts and war spending, set the country on a course of historic fiscal mismanagement. Daniels, seeing the coming problem, recommended deep cuts in many agency budgets to compensate for the Bush policies but few of his recommended cuts were passed by Congress. When the economy dipped, Bush’s expanding deficit ballooned. Some fiscal conservatives at the time howled, including New York Times columnist Ross Douthat, who pointed at Daniels as a major part of the problem, saying that he had “carried water for some of the Bush administration’s more egregious budgets [and...] made dubious public arguments in support of his boss’s agenda.” That agenda included the war in Iraq, which appeared on the books under Daniels as an invasion without longterm estimates accounting for the inevitable occupation. Sharp criticism of President Obama’s handling of the economy will feature prominently in Daniels’ response tonight, of course, and some of that criticism is sure to be accepted as legitimate among Americans across the political spectrum. Any line of argument that accounts for today’s budget deficit as a result of economic stimulus spending under Obama, however, will not be legitimate for having been thoroughly debunked. As Daniels well knows, steep tax cuts for the wealthy, extravagant war and homeland security spending and the Wall Street-based financial crisis of the Bush years drained the surpluses piled up during the Clinton years.

AFSCME Calls for Congress to “Stop Their Games and Get to Work” - Contact: Chris Fleming 25-January-2012 Statement of AFSCME President Gerald W. McEntee after Pres. Obama’s State of the Union address Washington, DC — “President Obama has a plan to move our country forward, create jobs and find real solutions. The choices Congress makes in 2012 will determine whether we save the middle class. We can do that by enacting President Obama’s jobs agenda. Or we can focus on misguided policies that do nothing but give more tax breaks to Wall Street financiers and transfer even more wealth to those at the top of the economic ladder. “This nation cannot continue to be held hostage by corporate-backed politicians who have rejected every meaningful jobs plan. Their reckless games have already harmed the recovery and cost us our credit rating – all because they care more about political games than creating jobs. Unfortunately, Indiana Gov. Mitch Daniels’ response to the president is a clear indication that his party will pursue a policy of more of the same. It’s time for Congress to stop their games and get to work. It’s time to enact the president’s agenda for jobs.”

State of the Union Reaction: A "compelling and powerful road map" or A Reelection Speech? - By DANIELA ALTIMARI - The Hartford Courant 25-January-2012 Sen. Richard Blumenthal called President Obama's State of the Union Speech a moving call to action threaded with specific proposals to reinvigorate the economy. Gov. Dannel P. Malloy, a Democrat like Blumenthal, said Obama unveiled "an optimistic and ambitious agenda" for moving the nation beyond partisan gridlock. But several local Republicans who are running for office were roundly critical of the speech. Justin Bernier, a candidate in the 5th Congressional district, dismissed Obama's speech as a campaign message that shunts the blame to others. And Lisa Wilson-Foley, another Republican running in the 5th, said the speech was a missed opportunity to bring the nation together. Below are the reactions of some Connecticut politicians, culled from statements and phone interviews afterward: Rep. John Larson, D-1st District: "The president did an extraordinary job,'' Larson said in a brief interview. The speech appealed to the nation's "better angels" and "tugged at the heartstrings of all Americans,'' he added, while at the same time highlighting a series of specific legislative proposals, including a call for increased domestic natural gas production, something Larson also backs. Chris Murphy, D-5th District and a candidate for U.S. Senate: "He led with manufacturing, which was music to my ears,'' Murphy said in a phone interview. Obama's call for the "reindustrialization" of the nation has big implications for Connecticut's manufacturing base, Murphy added. Murphy said he heard several "ohhs" and "ahhs" in the chamber when Obama discussed his education initiatives, particularly his proposal to make sure students stay in high school until they are 18. While the speech contained some "partisan red meat," Murphy said, "most of it can appeal to both sides of the aisle." Sen. Richard Blumenthal: In an interview, the freshman Democrat called the speech "a very powerful and compelling road map to economic success." But just as important, Blumenthal said, the president invoked "a military sense of common purpose" to bring the nation together. "He really appealed over the heads of Congress in summoning the nation to a higher purpose,'' Blumenthal said. "Members of this legislature are going to hear back from their constituents...this was a call to action for the nation and I do think Congress has to heed it." Rep. Rosa DeLauro, D-3rd District: "What the president did was capture the most important issue we face: how do we rebuild the middle class,'' DeLauro said in an interview. She rejected the notion that it was a campaign speech. "It was the exact opposition...it was not confrontational. He reverted to the values we hold dear as Americans." Rep. Joe Courtney, D-2nd District: In a statement, Courtney said the president's emphasis on rebuilding the manufacturing sector and education are crucial to Connecticut. "The President’s focus on education, especially partnerships between community colleges and businesses is critical to creating the jobs of tomorrow,'' Courtney said. "A college education is key to success in today’s economy, and I am encouraged by the President’s continued efforts to rein in college costs and help young people repay the student loans that have weighed them down too heavily for too long.” Jim Himes, D-4th District: "I was pleased by two things the President said tonight and one thing he did. First, he reminded us of the absolute importance of educating every one of our children, every one of our people, so that they can be competitive and help lead our shared effort to rebuild a nation that provides opportunity for everyone,'' Himes said in a statement. "We can’t expect to offer the American Dream if we don’t equip our young people with the capabilities and talents they need. Second, he called on us to make sure that we lead, not follow, on a clean energy future. Finally, the President struck an important—and needed—tone of optimism. At this moment when many Americans are discouraged and doubtful, he reminded us that our nation can accomplish anything if we work together.” Connecticut Republican Party Chairman Jerry Labriola Jr.: "Tonight, President Obama delivered a speech filled with excuses, but void of any real solutions to fix our ailing economy,'' he said in an email. "The president chose to focus on blaming others for his failed policies instead of addressing the high unemployment, out of control spending, and record deficit that they have created. While Americans were looking for the leadership of a president, Barack Obama offered the empty rhetoric of a candidate. Wayne Winsley, a Republican candidate in the 3rd District: Winsley said the speech was "more of the same" from the president. "The President’s speech consisted of incentives and programs, which have already been tried and found failing,'' Winsley said in an email Wednesday morning. "Temporary tax credits to employers and small businesses, extension of the payroll tax cut, subsidies to favored industries (think more Solyndras) and a vague and open-ended promise to invest in 'America’s infrastructure' will not revive the American economy. Justin Bernier, a Republican candidate in the 5th Congressional District: "President Obama missed an opportunity to lead tonight,'' Bernier said in a statement. "He talked about how our military uses teamwork to achieve common goals, but quickly blamed others for the grave state of our union. That’s not real leadership. Candidate Obama departs the capital for the campaign trail tomorrow morning. It’s now up to the Republicans to offer voters real leadership and real solutions for moving America forward again.” Lisa Wilson-Foley, a Republican candidate in the 5th Congressional District: "President Obama just passed up a chance to bring our country together,'' Wilson-Foley said in a statement. "Instead of uniting our nation he kicked off his reelection campaign by proposing more government spending and less private sector solutions." "When will President Obama get serious? When will the Democrats in the U.S. Senate work with the House Republicans to meet their responsibilities? Let us hope this speech is not a continuation of the destructive politics which have poisoned the debate and divided Americans,'' she said. Mark Greenberg, a Republican candidate in the 5th Congressional District: "Four years ago, the president ran on a campaign that promised change. Instead we have experienced failed economic policies and unfulfilled promises,'' Greenberg said in a press release. "It’s time for a real change in Washington – a Republican change with conservative Republican fiscal values and common sense.” Sen. Joe Lieberman, an Independent: "Now that we have heard the President’s State of the Union message, Congress should not let this year pass without taking serious action on the greatest threat to our nation’s economic recovery – the ever-growing deficit,'' Lieberman said in a statement. "For at least a few months, we should put partisanship aside and lay the groundwork for a serious reduction in the nation’s deficit, which is our best hope to help our economy and create jobs. I would also hope that we can pass legislation that has broad bi-partisan support such as the cyber-security bill. Although this is an election year, the people’s business cannot be neglected and that is why I believe it is essential to make progress on some of the critical issues facing our country.” Gov. Dannel P. Malloy, Democrat: "Tonight, the President unveiled an optimistic and ambitious agenda for our country. He called on Congress to end its partisan bickering and obstruction and pass meaningful legislation to bolster our recovery and accelerate economic growth. I couldn’t agree more,'' Malloy said in a press release. "The President and I share a common vision for a strong and thriving economy — an economy that creates jobs and grows our middle class. In Connecticut, Democrats and Republicans have worked together to improve the lives of Connecticut residents. We passed a far-reaching jobs package that will attract new investment and strengthen our economy. We continue to work long and hard to stabilize our state’s finances so that future generations aren’t saddled by a staggering debt."

Obama urges taxing the rich, reining in Wall Street - Matt Spetalnick - The Hartford Courant 25-January-2012 WASHINGTON (Reuters) - President Barack Obama used his last State of the Union speech before the November election to paint himself as the champion of the middle class, by demanding higher taxes for millionaires and tight reins on Wall Street. Taking advantage of a huge national platform to make the case for his re-election, Obama on Tuesday defiantly defended his record after three years in office and laid blame for many of the country's woes at the feet of banks and what he called an out-of-touch Congress. He proposed sweeping changes in the tax code and new remedies for the U.S. housing crisis, setting as a central campaign theme a populist call for greater economic fairness. He mentioned taxes 34 times and jobs 32 times during his hour-long speech, emphasizing the two issues at the heart of this year's presidential campaign. While the biggest proposals in Obama's speech are considered unlikely to gain traction in a deeply divided Congress, the White House believes the president can tap into voters' resentment over the financial industry's abuses and Washington's dysfunction. But even as he called for a "return to American values of fair play and shared responsibility," Obama seemed to put no blame on himself for a still-fragile economic recovery and high unemployment that could trip up his re-election bid. With polls showing most Americans disapprove of his economic leadership, he still faces the stiff challenge of convincing them that the candidate who was swept into the White House in 2008 promising hope and change now deserves another term. Standing before a joint session of Congress, Obama unleashed a partisan attack over taxes and vowed no return to "the days when Wall Street was allowed to play by its own set of rules." "Washington should stop subsiding millionaires," Obama declared as he proposed a minimum 30 percent effective tax rate on those who earn a million dollars or more. Obama said he would ask his attorney general to establish a special financial crimes unit to prosecute those parties charged with breaking the law, and whose fraud contributed to the 2007-2009 financial crisis that plunged the United States into recession. Obama's message could resonate in the 2012 campaign following the release of tax records by Mitt Romney, a potential Republican rival and one of the wealthiest men ever to run for the White House. He pays a lower effective tax rate than many top wage-earners. A new proposal outlined by Obama to ease the way for more American homeowners to get mortgage relief - and to pay for the plan with a fee on banks blamed for helping create the housing crisis - also struck a populist note. Democrats have hammered Republicans in Congress for supporting tax breaks that favor the wealthy. Republicans staunchly oppose tax hikes, even on the richest Americans, arguing they would hurt a fragile economic recovery. "No feature of the Obama presidency has been sadder than its constant efforts to divide us, to curry favor with some Americans by castigating others," Indiana Governor Mitch Daniels said in the Republican response to Obama. House of Representatives Speaker John Boehner, the top congressional Republican, insisted the election would be a referendum on the president's "failed" policies. The U.S. unemployment rate was 8.5 percent in December. No president in the modern era has won re-election with the rate that high. CHEERS AND SILENCE Obama's rhetoric and his audience's response was more overtly partisan than last year when both sides sought a tone of civility in the aftermath of an assassination attempt on Democratic Arizona lawmaker Gabrielle Giffords. In the most emotional moment of the evening, Obama warmly embraced Giffords as he made his way to the podium. The congresswoman, who has made a remarkable recovery after being shot in the head, announced on Sunday she was retiring from Congress. The response to Giffords was one of the few moments of bipartisan enthusiasm in a Congress riven by antagonism. Democrats rose en mass to cheer, and Republicans stayed seated in stony silence, when Obama vowed to "oppose obstruction with action." But both sides applauded when Obama called for developing all domestic energy sources. Obama used the speech to revive his call to rewrite the tax code to adopt the so-called "Buffett rule," named after the billionaire Warren Buffett, who says it is unfair that he pays a lower tax rate than his secretary. Those making more than $1 million a year would pay an effective tax rate of at least 30 percent and their tax deductions would be eliminated. To underscore his point, Buffett's secretary, Debbie Bosanek, was seated in the first lady's box in the House of Representatives for Obama's address. As the president walked to the podium to give his speech he was overheard congratulating Defense Secretary Leon Panetta. "Good job tonight. Good job tonight." Only later was it learned Obama was apparently referring to the rescue by the U.S. military of an American and a Dane being held hostage by pirates in Somalia. The operation was not made public until after the speech. Obama will shift into full campaign mode on a three-day tour starting on Wednesday to Iowa, Arizona, Nevada, Colorado and Michigan, all election battleground states. In his speech, Obama also rolled out proposed corporate tax reforms, including a minimum rate on companies' overseas profits and a tax credit for moving jobs back home. Taking aim at China - an election-year target of Republicans and Democrats alike over its currency and trade practices - Obama proposed creation of a new trade enforcement unit within the federal government. Promising what amounts to a peace dividend, Obama also proposed using half of the "savings" from ending the war in Iraq and winding down in Afghanistan to pay down U.S. debt, with the other half going to fixing decaying roads and railways. Addressing the housing crisis, Obama said he would send to Congress a proposal to allow more Americans to take out new and cheaper mortgages as long as they are current on their payments, savings that would amount to $3,000 per household each year. The depressed housing market continues to drag on the economy. (Additional reporting by Laura MacInnis, Alister Bull, Samson Reiny, Margaret Chadbourn, Editing by Ross Colvin and Eric Beech)

State of the Union Address - The White House 25-January-2012 The White House Office of the Press Secretary For Immediate Release January 24, 2012 Remarks by the President in State of the Union Address United States Capitol Washington, D.C. 9:10 P.M. EST THE PRESIDENT: Mr. Speaker, Mr. Vice President, members of Congress, distinguished guests, and fellow Americans: Last month, I went to Andrews Air Force Base and welcomed home some of our last troops to serve in Iraq. Together, we offered a final, proud salute to the colors under which more than a million of our fellow citizens fought -- and several thousand gave their lives. We gather tonight knowing that this generation of heroes has made the United States safer and more respected around the world. (Applause.) For the first time in nine years, there are no Americans fighting in Iraq. (Applause.) For the first time in two decades, Osama bin Laden is not a threat to this country. (Applause.) Most of al Qaeda’s top lieutenants have been defeated. The Taliban’s momentum has been broken, and some troops in Afghanistan have begun to come home. These achievements are a testament to the courage, selflessness and teamwork of America’s Armed Forces. At a time when too many of our institutions have let us down, they exceed all expectations. They’re not consumed with personal ambition. They don’t obsess over their differences. They focus on the mission at hand. They work together. Imagine what we could accomplish if we followed their example. (Applause.) Think about the America within our reach: A country that leads the world in educating its people. An America that attracts a new generation of high-tech manufacturing and high-paying jobs. A future where we’re in control of our own energy, and our security and prosperity aren’t so tied to unstable parts of the world. An economy built to last, where hard work pays off, and responsibility is rewarded. We can do this. I know we can, because we’ve done it before. At the end of World War II, when another generation of heroes returned home from combat, they built the strongest economy and middle class the world has ever known. (Applause.) My grandfather, a veteran of Patton’s Army, got the chance to go to college on the GI Bill. My grandmother, who worked on a bomber assembly line, was part of a workforce that turned out the best products on Earth. The two of them shared the optimism of a nation that had triumphed over a depression and fascism. They understood they were part of something larger; that they were contributing to a story of success that every American had a chance to share -- the basic American promise that if you worked hard, you could do well enough to raise a family, own a home, send your kids to college, and put a little away for retirement. The defining issue of our time is how to keep that promise alive. No challenge is more urgent. No debate is more important. We can either settle for a country where a shrinking number of people do really well while a growing number of Americans barely get by, or we can restore an economy where everyone gets a fair shot, and everyone does their fair share, and everyone plays by the same set of rules. (Applause.) What’s at stake aren’t Democratic values or Republican values, but American values. And we have to reclaim them. Let’s remember how we got here. Long before the recession, jobs and manufacturing began leaving our shores. Technology made businesses more efficient, but also made some jobs obsolete. Folks at the top saw their incomes rise like never before, but most hardworking Americans struggled with costs that were growing, paychecks that weren’t, and personal debt that kept piling up. In 2008, the house of cards collapsed. We learned that mortgages had been sold to people who couldn’t afford or understand them. Banks had made huge bets and bonuses with other people’s money. Regulators had looked the other way, or didn’t have the authority to stop the bad behavior. It was wrong. It was irresponsible. And it plunged our economy into a crisis that put millions out of work, saddled us with more debt, and left innocent, hardworking Americans holding the bag. In the six months before I took office, we lost nearly 4 million jobs. And we lost another 4 million before our policies were in full effect. Those are the facts. But so are these: In the last 22 months, businesses have created more than 3 million jobs. (Applause.) Last year, they created the most jobs since 2005. American manufacturers are hiring again, creating jobs for the first time since the late 1990s. Together, we’ve agreed to cut the deficit by more than $2 trillion. And we’ve put in place new rules to hold Wall Street accountable, so a crisis like this never happens again. (Applause.) The state of our Union is getting stronger. And we’ve come too far to turn back now. As long as I’m President, I will work with anyone in this chamber to build on this momentum. But I intend to fight obstruction with action, and I will oppose any effort to return to the very same policies that brought on this economic crisis in the first place. (Applause.) No, we will not go back to an economy weakened by outsourcing, bad debt, and phony financial profits. Tonight, I want to speak about how we move forward, and lay out a blueprint for an economy that’s built to last -– an economy built on American manufacturing, American energy, skills for American workers, and a renewal of American values. Now, this blueprint begins with American manufacturing. On the day I took office, our auto industry was on the verge of collapse. Some even said we should let it die. With a million jobs at stake, I refused to let that happen. In exchange for help, we demanded responsibility. We got workers and automakers to settle their differences. We got the industry to retool and restructure. Today, General Motors is back on top as the world’s number-one automaker. (Applause.) Chrysler has grown faster in the U.S. than any major car company. Ford is investing billions in U.S. plants and factories. And together, the entire industry added nearly 160,000 jobs. We bet on American workers. We bet on American ingenuity. And tonight, the American auto industry is back. (Applause.) What’s happening in Detroit can happen in other industries. It can happen in Cleveland and Pittsburgh and Raleigh. We can’t bring every job back that’s left our shore. But right now, it’s getting more expensive to do business in places like China. Meanwhile, America is more productive. A few weeks ago, the CEO of Master Lock told me that it now makes business sense for him to bring jobs back home. (Applause.) Today, for the first time in 15 years, Master Lock’s unionized plant in Milwaukee is running at full capacity. (Applause.) So we have a huge opportunity, at this moment, to bring manufacturing back. But we have to seize it. Tonight, my message to business leaders is simple: Ask yourselves what you can do to bring jobs back to your country, and your country will do everything we can to help you succeed. (Applause.) We should start with our tax code. Right now, companies get tax breaks for moving jobs and profits overseas. Meanwhile, companies that choose to stay in America get hit with one of the highest tax rates in the world. It makes no sense, and everyone knows it. So let’s change it. First, if you’re a business that wants to outsource jobs, you shouldn’t get a tax deduction for doing it. (Applause.) That money should be used to cover moving expenses for companies like Master Lock that decide to bring jobs home. (Applause.) Second, no American company should be able to avoid paying its fair share of taxes by moving jobs and profits overseas. (Applause.) From now on, every multinational company should have to pay a basic minimum tax. And every penny should go towards lowering taxes for companies that choose to stay here and hire here in America. (Applause.) Third, if you’re an American manufacturer, you should get a bigger tax cut. If you’re a high-tech manufacturer, we should double the tax deduction you get for making your products here. And if you want to relocate in a community that was hit hard when a factory left town, you should get help financing a new plant, equipment, or training for new workers. (Applause.) So my message is simple. It is time to stop rewarding businesses that ship jobs overseas, and start rewarding companies that create jobs right here in America. Send me these tax reforms, and I will sign them right away. (Applause.) We’re also making it easier for American businesses to sell products all over the world. Two years ago, I set a goal of doubling U.S. exports over five years. With the bipartisan trade agreements we signed into law, we’re on track to meet that goal ahead of schedule. (Applause.) And soon, there will be millions of new customers for American goods in Panama, Colombia, and South Korea. Soon, there will be new cars on the streets of Seoul imported from Detroit, and Toledo, and Chicago. (Applause.) I will go anywhere in the world to open new markets for American products. And I will not stand by when our competitors don’t play by the rules. We’ve brought trade cases against China at nearly twice the rate as the last administration –- and it’s made a difference. (Applause.) Over a thousand Americans are working today because we stopped a surge in Chinese tires. But we need to do more. It’s not right when another country lets our movies, music, and software be pirated. It’s not fair when foreign manufacturers have a leg up on ours only because they’re heavily subsidized. Tonight, I’m announcing the creation of a Trade Enforcement Unit that will be charged with investigating unfair trading practices in countries like China. (Applause.) There will be more inspections to prevent counterfeit or unsafe goods from crossing our borders. And this Congress should make sure that no foreign company has an advantage over American manufacturing when it comes to accessing financing or new markets like Russia. Our workers are the most productive on Earth, and if the playing field is level, I promise you -– America will always win. (Applause.) I also hear from many business leaders who want to hire in the United States but can’t find workers with the right skills. Growing industries in science and technology have twice as many openings as we have workers who can do the job. Think about that –- openings at a time when millions of Americans are looking for work. It’s inexcusable. And we know how to fix it. Jackie Bray is a single mom from North Carolina who was laid off from her job as a mechanic. Then Siemens opened a gas turbine factory in Charlotte, and formed a partnership with Central Piedmont Community College. The company helped the college design courses in laser and robotics training. It paid Jackie’s tuition, then hired her to help operate their plant. I want every American looking for work to have the same opportunity as Jackie did. Join me in a national commitment to train 2 million Americans with skills that will lead directly to a job. (Applause.) My administration has already lined up more companies that want to help. Model partnerships between businesses like Siemens and community colleges in places like Charlotte, and Orlando, and Louisville are up and running. Now you need to give more community colleges the resources they need to become community career centers -– places that teach people skills that businesses are looking for right now, from data management to high-tech manufacturing. And I want to cut through the maze of confusing training programs, so that from now on, people like Jackie have one program, one website, and one place to go for all the information and help that they need. It is time to turn our unemployment system into a reemployment system that puts people to work. (Applause.) These reforms will help people get jobs that are open today. But to prepare for the jobs of tomorrow, our commitment to skills and education has to start earlier. For less than 1 percent of what our nation spends on education each year, we’ve convinced nearly every state in the country to raise their standards for teaching and learning -- the first time that’s happened in a generation. But challenges remain. And we know how to solve them. At a time when other countries are doubling down on education, tight budgets have forced states to lay off thousands of teachers. We know a good teacher can increase the lifetime income of a classroom by over $250,000. A great teacher can offer an escape from poverty to the child who dreams beyond his circumstance. Every person in this chamber can point to a teacher who changed the trajectory of their lives. Most teachers work tirelessly, with modest pay, sometimes digging into their own pocket for school supplies -- just to make a difference. Teachers matter. So instead of bashing them, or defending the status quo, let’s offer schools a deal. Give them the resources to keep good teachers on the job, and reward the best ones. (Applause.) And in return, grant schools flexibility: to teach with creativity and passion; to stop teaching to the test; and to replace teachers who just aren’t helping kids learn. That’s a bargain worth making. (Applause.) We also know that when students don’t walk away from their education, more of them walk the stage to get their diploma. When students are not allowed to drop out, they do better. So tonight, I am proposing that every state -- every state -- requires that all students stay in high school until they graduate or turn 18. (Applause.) When kids do graduate, the most daunting challenge can be the cost of college. At a time when Americans owe more in tuition debt than credit card debt, this Congress needs to stop the interest rates on student loans from doubling in July. (Applause.) Extend the tuition tax credit we started that saves millions of middle-class families thousands of dollars, and give more young people the chance to earn their way through college by doubling the number of work-study jobs in the next five years. (Applause.) Of course, it’s not enough for us to increase student aid. We can’t just keep subsidizing skyrocketing tuition; we’ll run out of money. States also need to do their part, by making higher education a higher priority in their budgets. And colleges and universities have to do their part by working to keep costs down. Recently, I spoke with a group of college presidents who’ve done just that. Some schools redesign courses to help students finish more quickly. Some use better technology. The point is, it’s possible. So let me put colleges and universities on notice: If you can’t stop tuition from going up, the funding you get from taxpayers will go down. (Applause.) Higher education can’t be a luxury -– it is an economic imperative that every family in America should be able to afford. Let’s also remember that hundreds of thousands of talented, hardworking students in this country face another challenge: the fact that they aren’t yet American citizens. Many were brought here as small children, are American through and through, yet they live every day with the threat of deportation. Others came more recently, to study business and science and engineering, but as soon as they get their degree, we send them home to invent new products and create new jobs somewhere else. That doesn’t make sense. I believe as strongly as ever that we should take on illegal immigration. That’s why my administration has put more boots on the border than ever before. That’s why there are fewer illegal crossings than when I took office. The opponents of action are out of excuses. We should be working on comprehensive immigration reform right now. (Applause.) But if election-year politics keeps Congress from acting on a comprehensive plan, let’s at least agree to stop expelling responsible young people who want to staff our labs, start new businesses, defend this country. Send me a law that gives them the chance to earn their citizenship. I will sign it right away. (Applause.) You see, an economy built to last is one where we encourage the talent and ingenuity of every person in this country. That means women should earn equal pay for equal work. (Applause.) It means we should support everyone who’s willing to work, and every risk-taker and entrepreneur who aspires to become the next Steve Jobs. After all, innovation is what America has always been about. Most new jobs are created in start-ups and small businesses. So let’s pass an agenda that helps them succeed. Tear down regulations that prevent aspiring entrepreneurs from getting the financing to grow. (Applause.) Expand tax relief to small businesses that are raising wages and creating good jobs. Both parties agree on these ideas. So put them in a bill, and get it on my desk this year. (Applause.) Innovation also demands basic research. Today, the discoveries taking place in our federally financed labs and universities could lead to new treatments that kill cancer cells but leave healthy ones untouched. New lightweight vests for cops and soldiers that can stop any bullet. Don’t gut these investments in our budget. Don’t let other countries win the race for the future. Support the same kind of research and innovation that led to the computer chip and the Internet; to new American jobs and new American industries. And nowhere is the promise of innovation greater than in American-made energy. Over the last three years, we’ve opened millions of new acres for oil and gas exploration, and tonight, I’m directing my administration to open more than 75 percent of our potential offshore oil and gas resources. (Applause.) Right now -- right now -- American oil production is the highest that it’s been in eight years. That’s right -- eight years. Not only that -- last year, we relied less on foreign oil than in any of the past 16 years. (Applause.) But with only 2 percent of the world’s oil reserves, oil isn’t enough. This country needs an all-out, all-of-the-above strategy that develops every available source of American energy. (Applause.) A strategy that’s cleaner, cheaper, and full of new jobs. We have a supply of natural gas that can last America nearly 100 years. (Applause.) And my administration will take every possible action to safely develop this energy. Experts believe this will support more than 600,000 jobs by the end of the decade. And I’m requiring all companies that drill for gas on public lands to disclose the chemicals they use. (Applause.) Because America will develop this resource without putting the health and safety of our citizens at risk. The development of natural gas will create jobs and power trucks and factories that are cleaner and cheaper, proving that we don’t have to choose between our environment and our economy. (Applause.) And by the way, it was public research dollars, over the course of 30 years, that helped develop the technologies to extract all this natural gas out of shale rock –- reminding us that government support is critical in helping businesses get new energy ideas off the ground. (Applause.) Now, what’s true for natural gas is just as true for clean energy. In three years, our partnership with the private sector has already positioned America to be the world’s leading manufacturer of high-tech batteries. Because of federal investments, renewable energy use has nearly doubled, and thousands of Americans have jobs because of it. When Bryan Ritterby was laid off from his job making furniture, he said he worried that at 55, no one would give him a second chance. But he found work at Energetx, a wind turbine manufacturer in Michigan. Before the recession, the factory only made luxury yachts. Today, it’s hiring workers like Bryan, who said, “I’m proud to be working in the industry of the future.” Our experience with shale gas, our experience with natural gas, shows us that the payoffs on these public investments don’t always come right away. Some technologies don’t pan out; some companies fail. But I will not walk away from the promise of clean energy. I will not walk away from workers like Bryan. (Applause.) I will not cede the wind or solar or battery industry to China or Germany because we refuse to make the same commitment here. We’ve subsidized oil companies for a century. That’s long enough. (Applause.) It’s time to end the taxpayer giveaways to an industry that rarely has been more profitable, and double-down on a clean energy industry that never has been more promising. Pass clean energy tax credits. Create these jobs. (Applause.) We can also spur energy innovation with new incentives. The differences in this chamber may be too deep right now to pass a comprehensive plan to fight climate change. But there’s no reason why Congress shouldn’t at least set a clean energy standard that creates a market for innovation. So far, you haven’t acted. Well, tonight, I will. I’m directing my administration to allow the development of clean energy on enough public land to power 3 million homes. And I’m proud to announce that the Department of Defense, working with us, the world’s largest consumer of energy, will make one of the largest commitments to clean energy in history -– with the Navy purchasing enough capacity to power a quarter of a million homes a year. (Applause.) Of course, the easiest way to save money is to waste less energy. So here’s a proposal: Help manufacturers eliminate energy waste in their factories and give businesses incentives to upgrade their buildings. Their energy bills will be $100 billion lower over the next decade, and America will have less pollution, more manufacturing, more jobs for construction workers who need them. Send me a bill that creates these jobs. (Applause.) Building this new energy future should be just one part of a broader agenda to repair America’s infrastructure. So much of America needs to be rebuilt. We’ve got crumbling roads and bridges; a power grid that wastes too much energy; an incomplete high-speed broadband network that prevents a small business owner in rural America from selling her products all over the world. During the Great Depression, America built the Hoover Dam and the Golden Gate Bridge. After World War II, we connected our states with a system of highways. Democratic and Republican administrations invested in great projects that benefited everybody, from the workers who built them to the businesses that still use them today. In the next few weeks, I will sign an executive order clearing away the red tape that slows down too many construction projects. But you need to fund these projects. Take the money we’re no longer spending at war, use half of it to pay down our debt, and use the rest to do some nation-building right here at home. (Applause.) There’s never been a better time to build, especially since the construction industry was one of the hardest hit when the housing bubble burst. Of course, construction workers weren’t the only ones who were hurt. So were millions of innocent Americans who’ve seen their home values decline. And while government can’t fix the problem on its own, responsible homeowners shouldn’t have to sit and wait for the housing market to hit bottom to get some relief. And that’s why I’m sending this Congress a plan that gives every responsible homeowner the chance to save about $3,000 a year on their mortgage, by refinancing at historically low rates. (Applause.) No more red tape. No more runaround from the banks. A small fee on the largest financial institutions will ensure that it won’t add to the deficit and will give those banks that were rescued by taxpayers a chance to repay a deficit of trust. (Applause.) Let’s never forget: Millions of Americans who work hard and play by the rules every day deserve a government and a financial system that do the same. It’s time to apply the same rules from top to bottom. No bailouts, no handouts, and no copouts. An America built to last insists on responsibility from everybody. We’ve all paid the price for lenders who sold mortgages to people who couldn’t afford them, and buyers who knew they couldn’t afford them. That’s why we need smart regulations to prevent irresponsible behavior. (Applause.) Rules to prevent financial fraud or toxic dumping or faulty medical devices -- these don’t destroy the free market. They make the free market work better. There’s no question that some regulations are outdated, unnecessary, or too costly. In fact, I’ve approved fewer regulations in the first three years of my presidency than my Republican predecessor did in his. (Applause.) I’ve ordered every federal agency to eliminate rules that don’t make sense. We’ve already announced over 500 reforms, and just a fraction of them will save business and citizens more than $10 billion over the next five years. We got rid of one rule from 40 years ago that could have forced some dairy farmers to spend $10,000 a year proving that they could contain a spill -- because milk was somehow classified as an oil. With a rule like that, I guess it was worth crying over spilled milk. (Laughter and applause.) Now, I’m confident a farmer can contain a milk spill without a federal agency looking over his shoulder. (Applause.) Absolutely. But I will not back down from making sure an oil company can contain the kind of oil spill we saw in the Gulf two years ago. (Applause.) I will not back down from protecting our kids from mercury poisoning, or making sure that our food is safe and our water is clean. I will not go back to the days when health insurance companies had unchecked power to cancel your policy, deny your coverage, or charge women differently than men. (Applause.) And I will not go back to the days when Wall Street was allowed to play by its own set of rules. The new rules we passed restore what should be any financial system’s core purpose: Getting funding to entrepreneurs with the best ideas, and getting loans to responsible families who want to buy a home, or start a business, or send their kids to college. So if you are a big bank or financial institution, you’re no longer allowed to make risky bets with your customers’ deposits. You’re required to write out a “living will” that details exactly how you’ll pay the bills if you fail –- because the rest of us are not bailing you out ever again. (Applause.) And if you’re a mortgage lender or a payday lender or a credit card company, the days of signing people up for products they can’t afford with confusing forms and deceptive practices -- those days are over. Today, American consumers finally have a watchdog in Richard Cordray with one job: To look out for them. (Applause.) We’ll also establish a Financial Crimes Unit of highly trained investigators to crack down on large-scale fraud and protect people’s investments. Some financial firms violate major anti-fraud laws because there’s no real penalty for being a repeat offender. That’s bad for consumers, and it’s bad for the vast majority of bankers and financial service professionals who do the right thing. So pass legislation that makes the penalties for fraud count. And tonight, I’m asking my Attorney General to create a special unit of federal prosecutors and leading state attorney general to expand our investigations into the abusive lending and packaging of risky mortgages that led to the housing crisis. (Applause.) This new unit will hold accountable those who broke the law, speed assistance to homeowners, and help turn the page on an era of recklessness that hurt so many Americans. Now, a return to the American values of fair play and shared responsibility will help protect our people and our economy. But it should also guide us as we look to pay down our debt and invest in our future. Right now, our most immediate priority is stopping a tax hike on 160 million working Americans while the recovery is still fragile. (Applause.) People cannot afford losing $40 out of each paycheck this year. There are plenty of ways to get this done. So let’s agree right here, right now: No side issues. No drama. Pass the payroll tax cut without delay. Let’s get it done. (Applause.) When it comes to the deficit, we’ve already agreed to more than $2 trillion in cuts and savings. But we need to do more, and that means making choices. Right now, we’re poised to spend nearly $1 trillion more on what was supposed to be a temporary tax break for the wealthiest 2 percent of Americans. Right now, because of loopholes and shelters in the tax code, a quarter of all millionaires pay lower tax rates than millions of middle-class households. Right now, Warren Buffett pays a lower tax rate than his secretary. Do we want to keep these tax cuts for the wealthiest Americans? Or do we want to keep our investments in everything else –- like education and medical research; a strong military and care for our veterans? Because if we’re serious about paying down our debt, we can’t do both. The American people know what the right choice is. So do I. As I told the Speaker this summer, I’m prepared to make more reforms that rein in the long-term costs of Medicare and Medicaid, and strengthen Social Security, so long as those programs remain a guarantee of security for seniors. But in return, we need to change our tax code so that people like me, and an awful lot of members of Congress, pay our fair share of taxes. (Applause.) Tax reform should follow the Buffett Rule. If you make more than $1 million a year, you should not pay less than 30 percent in taxes. And my Republican friend Tom Coburn is right: Washington should stop subsidizing millionaires. In fact, if you’re earning a million dollars a year, you shouldn’t get special tax subsidies or deductions. On the other hand, if you make under $250,000 a year, like 98 percent of American families, your taxes shouldn’t go up. (Applause.) You’re the ones struggling with rising costs and stagnant wages. You’re the ones who need relief. Now, you can call this class warfare all you want. But asking a billionaire to pay at least as much as his secretary in taxes? Most Americans would call that common sense. We don’t begrudge financial success in this country. We admire it. When Americans talk about folks like me paying my fair share of taxes, it’s not because they envy the rich. It’s because they understand that when I get a tax break I don’t need and the country can’t afford, it either adds to the deficit, or somebody else has to make up the difference -- like a senior on a fixed income, or a student trying to get through school, or a family trying to make ends meet. That’s not right. Americans know that’s not right. They know that this generation’s success is only possible because past generations felt a responsibility to each other, and to the future of their country, and they know our way of life will only endure if we feel that same sense of shared responsibility. That’s how we’ll reduce our deficit. That’s an America built to last. (Applause.) Now, I recognize that people watching tonight have differing views about taxes and debt, energy and health care. But no matter what party they belong to, I bet most Americans are thinking the same thing right about now: Nothing will get done in Washington this year, or next year, or maybe even the year after that, because Washington is broken. Can you blame them for feeling a little cynical? The greatest blow to our confidence in our economy last year didn’t come from events beyond our control. It came from a debate in Washington over whether the United States would pay its bills or not. Who benefited from that fiasco? I’ve talked tonight about the deficit of trust between Main Street and Wall Street. But the divide between this city and the rest of the country is at least as bad -- and it seems to get worse every year. Some of this has to do with the corrosive influence of money in politics. So together, let’s take some steps to fix that. Send me a bill that bans insider trading by members of Congress; I will sign it tomorrow. (Applause.) Let’s limit any elected official from owning stocks in industries they impact. Let’s make sure people who bundle campaign contributions for Congress can’t lobby Congress, and vice versa -- an idea that has bipartisan support, at least outside of Washington. Some of what’s broken has to do with the way Congress does its business these days. A simple majority is no longer enough to get anything -– even routine business –- passed through the Senate. (Applause.) Neither party has been blameless in these tactics. Now both parties should put an end to it. (Applause.) For starters, I ask the Senate to pass a simple rule that all judicial and public service nominations receive a simple up or down vote within 90 days. (Applause.) The executive branch also needs to change. Too often, it’s inefficient, outdated and remote. (Applause.) That’s why I’ve asked this Congress to grant me the authority to consolidate the federal bureaucracy, so that our government is leaner, quicker, and more responsive to the needs of the American people. (Applause.) Finally, none of this can happen unless we also lower the temperature in this town. We need to end the notion that the two parties must be locked in a perpetual campaign of mutual destruction; that politics is about clinging to rigid ideologies instead of building consensus around common-sense ideas. I’m a Democrat. But I believe what Republican Abraham Lincoln believed: That government should do for people only what they cannot do better by themselves, and no more. (Applause.) That’s why my education reform offers more competition, and more control for schools and states. That’s why we’re getting rid of regulations that don’t work. That’s why our health care law relies on a reformed private market, not a government program. On the other hand, even my Republican friends who complain the most about government spending have supported federally financed roads, and clean energy projects, and federal offices for the folks back home. The point is, we should all want a smarter, more effective government. And while we may not be able to bridge our biggest philosophical differences this year, we can make real progress. With or without this Congress, I will keep taking actions that help the economy grow. But I can do a whole lot more with your help. Because when we act together, there’s nothing the United States of America can’t achieve. (Applause.) That’s the lesson we’ve learned from our actions abroad over the last few years. Ending the Iraq war has allowed us to strike decisive blows against our enemies. From Pakistan to Yemen, the al Qaeda operatives who remain are scrambling, knowing that they can’t escape the reach of the United States of America. (Applause.) From this position of strength, we’ve begun to wind down the war in Afghanistan. Ten thousand of our troops have come home. Twenty-three thousand more will leave by the end of this summer. This transition to Afghan lead will continue, and we will build an enduring partnership with Afghanistan, so that it is never again a source of attacks against America. (Applause.) As the tide of war recedes, a wave of change has washed across the Middle East and North Africa, from Tunis to Cairo; from Sana’a to Tripoli. A year ago, Qaddafi was one of the world’s longest-serving dictators -– a murderer with American blood on his hands. Today, he is gone. And in Syria, I have no doubt that the Assad regime will soon discover that the forces of change cannot be reversed, and that human dignity cannot be denied. (Applause.) How this incredible transformation will end remains uncertain. But we have a huge stake in the outcome. And while it’s ultimately up to the people of the region to decide their fate, we will advocate for those values that have served our own country so well. We will stand against violence and intimidation. We will stand for the rights and dignity of all human beings –- men and women; Christians, Muslims and Jews. We will support policies that lead to strong and stable democracies and open markets, because tyranny is no match for liberty. And we will safeguard America’s own security against those who threaten our citizens, our friends, and our interests. Look at Iran. Through the power of our diplomacy, a world that was once divided about how to deal with Iran’s nuclear program now stands as one. The regime is more isolated than ever before; its leaders are faced with crippling sanctions, and as long as they shirk their responsibilities, this pressure will not relent. Let there be no doubt: America is determined to prevent Iran from getting a nuclear weapon, and I will take no options off the table to achieve that goal. (Applause.) But a peaceful resolution of this issue is still possible, and far better, and if Iran changes course and meets its obligations, it can rejoin the community of nations. The renewal of American leadership can be felt across the globe. Our oldest alliances in Europe and Asia are stronger than ever. Our ties to the Americas are deeper. Our ironclad commitment -- and I mean ironclad -- to Israel’s security has meant the closest military cooperation between our two countries in history. (Applause.) We’ve made it clear that America is a Pacific power, and a new beginning in Burma has lit a new hope. From the coalitions we’ve built to secure nuclear materials, to the missions we’ve led against hunger and disease; from the blows we’ve dealt to our enemies, to the enduring power of our moral example, America is back. Anyone who tells you otherwise, anyone who tells you that America is in decline or that our influence has waned, doesn’t know what they’re talking about. (Applause.) That’s not the message we get from leaders around the world who are eager to work with us. That’s not how people feel from Tokyo to Berlin, from Cape Town to Rio, where opinions of America are higher than they’ve been in years. Yes, the world is changing. No, we can’t control every event. But America remains the one indispensable nation in world affairs –- and as long as I’m President, I intend to keep it that way. (Applause.) That’s why, working with our military leaders, I’ve proposed a new defense strategy that ensures we maintain the finest military in the world, while saving nearly half a trillion dollars in our budget. To stay one step ahead of our adversaries, I’ve already sent this Congress legislation that will secure our country from the growing dangers of cyber-threats. (Applause.) Above all, our freedom endures because of the men and women in uniform who defend it. (Applause.) As they come home, we must serve them as well as they’ve served us. That includes giving them the care and the benefits they have earned –- which is why we’ve increased annual VA spending every year I’ve been President. (Applause.) And it means enlisting our veterans in the work of rebuilding our nation. With the bipartisan support of this Congress, we’re providing new tax credits to companies that hire vets. Michelle and Jill Biden have worked with American businesses to secure a pledge of 135,000 jobs for veterans and their families. And tonight, I’m proposing a Veterans Jobs Corps that will help our communities hire veterans as cops and firefighters, so that America is as strong as those who defend her. (Applause.) Which brings me back to where I began. Those of us who’ve been sent here to serve can learn a thing or two from the service of our troops. When you put on that uniform, it doesn’t matter if you’re black or white; Asian, Latino, Native American; conservative, liberal; rich, poor; gay, straight. When you’re marching into battle, you look out for the person next to you, or the mission fails. When you’re in the thick of the fight, you rise or fall as one unit, serving one nation, leaving no one behind. One of my proudest possessions is the flag that the SEAL Team took with them on the mission to get bin Laden. On it are each of their names. Some may be Democrats. Some may be Republicans. But that doesn’t matter. Just like it didn’t matter that day in the Situation Room, when I sat next to Bob Gates -- a man who was George Bush’s defense secretary -- and Hillary Clinton -- a woman who ran against me for president. All that mattered that day was the mission. No one thought about politics. No one thought about themselves. One of the young men involved in the raid later told me that he didn’t deserve credit for the mission. It only succeeded, he said, because every single member of that unit did their job -- the pilot who landed the helicopter that spun out of control; the translator who kept others from entering the compound; the troops who separated the women and children from the fight; the SEALs who charged up the stairs. More than that, the mission only succeeded because every member of that unit trusted each other -- because you can’t charge up those stairs, into darkness and danger, unless you know that there’s somebody behind you, watching your back. So it is with America. Each time I look at that flag, I’m reminded that our destiny is stitched together like those 50 stars and those 13 stripes. No one built this country on their own. This nation is great because we built it together. This nation is great because we worked as a team. This nation is great because we get each other’s backs. And if we hold fast to that truth, in this moment of trial, there is no challenge too great; no mission too hard. As long as we are joined in common purpose, as long as we maintain our common resolve, our journey moves forward, and our future is hopeful, and the state of our Union will always be strong. Thank you, God bless you, and God bless the United States of America. (Applause.) END 10:16 P.M. EST

Thanks to Occupy, rich-poor gap is front and center. See Mitt Romney's tax return. - By David R. Francis - The Christian Science Monitor 24-January-2012 Newton, Mass. At the town meeting in New Hampshire where Senator John McCain endorsed Mitt Romney as the Republican presidential candidate last month, a questioner shouted: “The US has the highest income inequality in the entire developed world.” The senator, according to one press report, walked over to the man, and speaking “menacingly” said, “Be quiet.” Oops, too late, Senator! The secret’s already out: A new survey put out this month by the Pew Research Center finds two-thirds of Americans see “strong conflicts” between the rich and poor – including the majority of Republicans polled – an increase from 2009. The original survey question asked respondents: “In America, how much conflict is there between poor people and rich people?” Their responses shouldn’t be surprising. The rich have been piling up a bigger and bigger share of the nation’s income and wealth over recent decades – a fact borne out in Mr. Romney’s own tax return, which his campaign released today. Thanks in large part to information disseminated easily on the Web and the ongoing voice of the Occupy movement, Americans now know the income inequality gap well, and don’t like it because they regard it as unfair. As campaign rhetoric and coverage already show, the distribution of income and wealth will be a prominent issue in the forthcoming presidential and congressional elections. Under quizzing by the press, Mr. Romney has admitted that he pays an effective tax rate of about 15 percent. (His tax returns show that it’s closer to 14.5 – below average even for millionaires.) This is in large part because the vast majority of his income comes from “investments” (much of them a form of ongoing compensation from his work at private equity firm Bain Capital), which are taxed at the capital gains rate of 15 percent. That’s a rate far less than what many middle-income Americans pay in taxes. When Republican candidates warn that highlighting the issue of rising income-and-wealth disparity could stir up “class warfare,” they are absolutely right. So far, thankfully, the issue has not prompted any serious violence. The Occupy Wall Street movement has been basically peaceful, aiming successfully to bring to public attention the accumulation of wealth by the top 1 percent of Americans versus the remaining 99 percent. But history suggests a huge rich-poor gap can be a factor leading to political discontent and worse. One old history textbook, referring to the 1789 French Revolution and its Reign of Terror that cost many of the royal family and nobility their heads at the guillotine, notes “mob violence was the natural outcome of centuries of oppression of the poor by the rich.” The French Revolution had enormous influence across Europe, eventually bringing political, social, educational, and economic betterment for the bottom 99 percent and weakening the aristocracy. Of course, today’s poor Americans are far better off than the peasants and serfs of old Europe. And Americans nowadays have a relatively calm and unexcitable political character. They also have a higher average income than most citizens of big European nations. But the United States also has a higher rate of income inequality than Europe. Up to now, the rich aren’t being attacked in a vicious manner, thank goodness. But the mood could change if Republicans continue to insist that taxes not be raised on the well-to-do and that Congress cut government spending benefiting the poor and middle class to reduce the deficit. Certainly the rich-poor gap could cost Republicans many a vote later this year – though not their heads. So why does this income inequality gap feature so prominently in American political discourse now? For those interested in the economic facts, it is far easier today to find them than a few years ago. That’s largely because a host of liberal Web sites are today providing comments, studies, and news about the rich-poor divide. As preliminary campaign rhetoric shows, the distribution of income and wealth will be a prominent issue in the forthcoming presidential and congressional elections – for both Republicans and Democrats. It was a free web product called “Too Much” that mentioned the McCain incident. It’s a weekly email newsletter turned out by the Institute for Policy Studies that reviews inequality matters. A few years ago such a web site could have been ignored by Washington politicians. But today more citizens are getting their news and views from blogs, aggregate web sites, and social media, while traditional news media – both print and online – struggle to keep their audience. Even the cautious Organization for Economic Cooperation and Development in Paris uncharacteristically speaks of the need to tax the well-to-do in industrial nations. A study by the Center on Budget and Policy Priorities criticizes Mitt Romney’s proposal to eliminate major federal assistance programs for low-income Americans and turn them over to the states because the federal bureaucracy eats up most of the money Congress provides. “Simply false,” the study charges, noting that more than 90 percent of such programs as Medicaid, food stamps, housing vouchers, and school meals goes to beneficiaries, not the federal bureaucracy. Clearly, Americans – thanks in large part to sites like these and the Occupy movement’s persistent message – are more aware of the rich-poor gap. It has become a subject of national discussion and will figure significantly in the election season to come. David R. Francis is a former Monitor economics reporter and columnist

Lack of data on 'scream rooms' may be against the law, legislator says - By Jordan Fenster - New Haven Register 24-January-2012 School districts state-wide and the Department of Education may be flouting state law by not reviewing and compiling data on so-called “scream rooms,” a legislator confirmed Monday. According to statute passed in 2007, school districts state-wide are required to record every instance in which restraint or seclusion is used, and then “include such information in an annual compilation on its use of such restraint and seclusion.” The commissioner of the state agency that has jurisdiction over those schools, the DOE, may then review that compilation and “may produce an annual summary report identifying the frequency of use of physical restraint or seclusion,” the law says. The statute reads, “The commissioner of the state agency that has jurisdiction or supervisory control over each institution or facility shall review the annual compilation prior to renewing a license for or a contract with such institution or facility.” But when asked repeatedly if the DOE has compiled that information, spokesperson Mark Linabury refused to respond, saying the issue was more “complicated” than a yes or no answer. State Rep. Diana Urban, D-Stonington, said, “You cannot imagine what kind of reporting we don’t get.” Urban, chairwoman of the legislature’s Select Committee on Children, has been putting together a results-based accountability report card, intended to evaluate state policies and programs that affect children. She plans to unveil the first Children’s RBA Report Card in early February, and said restraint and seclusion rooms have become part of the initiative since news emerged that Farm Hill School in Middletown may have been using restraint and seclusion rooms inappropriately. Middletown School District Superintendent Michael Frechette confirmed that his district has been compiling the information but was unsure if that data has been transmitted to the state. The Middletown School District’s use of restraint and seclusion is currently under investigation by the state’s Child Advocate and the Office of Protection Advocacy for Persons with Disabilities. “This has become a huge part of what’s called school climate,” Urban said. “This one is clearly one of the issues off on a trajectory it should not be on.” When asked if she was surprised that data on “time-out rooms” may not be collected, Urban laughed. “Nobody’s asking for it,” she said. “We have so many data gaps. It’s a culture that needs to change.” When the law was originally drafted in 2007, a provision was included that would have required a regular report to the legislature, according to Sen. Ed Meyer, D-Branford. “That triggered a fiscal note,” he said, and the provision was removed. Urban agreed the law’s ambiguity — schools “shall” compile instances of physical restraint or seclusion, but the DOE “may” review that information — might be a reason why state-wide data on use of seclusion may not be collected. Meyer said the law’s initial intent was to “put a big spotlight” on use of seclusion, and to bring parents into the process. “If the information is not being disclosed, we’re probably going to have to get tough on this,” he said.

GOP Slates Antilabor Zealot Daniels for SOTU Response - By John Nichols - The Nation 24-January-2012 Mitch Daniels? Seriously? The Republican Party is so determined to advance the extreme antilabor agenda of its Wall Street funders and front groups such as the American Legislative Exchange Council that it shoved aside John Boehner (might have teared up), Paul Ryan (last year's man) and vaguely interesting governors such as New Jersey's Chris Christie and South Carolina's Nikki Haley (both backing a loser for president) in order to make way for Indiana Governor Daniels to deliver the response to Tuesday's State of the Union address by President Obama. The choice of Daniels, who is currently leading the fight to enact an antilabor "Right-to-Work (For Less)" law in Indiana, sends a powerful signal at a time when the Republicans who would be president are stumbling over one another to proclaim their enthusiasm for "Right-to-Work" legislation, their disdain for public employees and their unions, and (in Newt Gingrich's case) their determination to turn the clock back a century in order to eliminate child labor laws. Only Wisconsin Governor Scott Walker and Ohio Governor John Kasich are more closely linked in the public's mind with the union-bashing frenzy that has so energized Republican governors and legislators. And Daniels is, arguably, the most aggressive union basher of all. Having already stripped Indiana public employees of collective bargaining rights, he is now aiding and abetting the efforts of Indiana Republican legislators to undermine the rights of private sector workers. Now, the state-based fight goes national as an antilabor governor gets a forum to spread antilabor lies about how best to jumpstart a sputtering economy. "The national Republican party has selected Indiana Republican Gov. Mitch Daniels to respond to President Obama’s State of the Union address… sending a clear signal the party is making attacks on working people a top priority in the 2012 elections," observes the AFL-CIO Blog. Daniels is a key backer of right-to-work-for-less (RTW) legislation, which state Republican lawmakers, in a stunning display of arrogance, have repeatedly tried to ram through, while thumbing their noses at working Hoosiers—not to mention democracy. The response to the president's State of the Union Address by a representative of the opposition party has become as much a part of American political theater as the speech itself. The responses can be powerful (Virginia Senator Jim Webb in 2007) or pathetic (Louisiana Governor Bobby Jindal). They can be focused and conciliatory (Senate Majority Leader Bob Dole in 1996) or combative (Senate Majority Leader Harry Byrd in 1988). They can be pointless (House Minority Leader Richard Gephardt in 2002) or they can be riveting in their weirdness (House Budget Committee Chair Paul Ryan and Congresswoman Michele Bachmann's 2011 competition for the limelight). But this year the Republican response to President Obama's State of the Union address will break new ground. It will turn attention away from the national fights of the moment toward the states and highlight a Republican governor who is in the forefront of the coordinated campaign to undermine the collective bargaining rights of public sector unions and to weaken private sector unions to such an extent that many of them would struggle to survive. Daniels, who served as George W. Bush director of the Office of Management and Budget (from whence he hailed the surpluses created by Bill Clinton's Democratic administration), is more than capable of reciting his party's inside-the-beltway talking points ("Socialism! Alinsky! Socialism! Reagan! Socialism! Taxes! Socialism!"). But Daniels is not playing these days on the national tier of our politics—except perhaps as the candidate most Republicans wish were running for president. Rather, he is the face of the party's state-based strategies. While Wisconsin's Walker and Ohio's Kasich have drawn most of the headlines—and most of the political blowback—it is Indiana's Daniels who has been the steadiest and most successful pitchman for ALEC's antiunion agenda and the multinational corporations that have funded a nationwide assault on the rights of workers and on the unions that give them voice in the workplace and in the politics of communities, states and the nation. So determined is the former Bush administration budget boss to break the unions in his state that Daniels has been more than willing to deceive the electorate of Indiana—and, now, to deny them the right to vote in a referendum on whether they want to roll back labor laws. Politicians of both parties are often accused of being deceitful and disreputable. But few have been so precisely, and so completely, confirmed in their dishonesty as Mitch Daniels. In addition to the usual false claims about the economic "threats" that are posed by allowing workers to bargain for good pay, good benefits and good pensions, Daniels has been caught lying about his enthusiasm for worker rights. Elected on promises to unite Indiana on behalf of job creation, Daniels made a big deal about his willingness to work with labor unions. As he prepared to seek a second term, Daniels appeared at a Teamsters Local 135 stewards dinner where he specifically addressed the Right-to-Work issue. And he said he wasn't going there. “We can’t afford to have super wars over issues that might divide us," the governor told the assembled union members. "I have said it over and over again, and I’ll say it again tonight: I’m a supporter of the labor laws we have in the state of Indiana and I’m not interested in changing any of them—not the prevailing wage law and certainly not a ‘Right-to-Work’ law….” Now, Daniels is working with Republican legislators in Indiana to pass a "Right-to-Work" law. The Teamsters released a video of the speech and the AFL-CIO has circulated it with the message: "Gov. Daniels: Against ‘Right to Work’ Before He Was for It." On Tuesday, Daniels will take his hypocrisy national. And in so doing he will make it abundantly clear that the Republican Party is committed to union busting as an economic and political strategy.

Obama to make pitch for second term in State of the Union - By Matt Spetalnick - REUTERS 24-January-2012 Reuters) - President Barack Obama will pitch new initiatives on jobs, taxes and housing in an election-year State of the Union address on Tuesday, making a sweeping case for a second term despite the slow U.S. economic recovery and high jobless rate. Framed in what is expected to be a starkly populist speech, most of Obama's proposals will face stiff Republican resistance, limiting the chance of headway in a divided Congress before the November 6 general election. But the White House hopes Obama can gain enough traction with voters to help restore faith in his economic leadership as the Democratic president defends himself against escalating attacks by Republican candidates vying to face him on the November ballot. When he stands before a joint session of Congress at 9 p.m. EST (0200 GMT on Wednesday), Obama is expected to push tax breaks for bringing manufacturing jobs home from overseas, ideas to help the troubled home-mortgage market and incentives for alternative energy development, people familiar with the speech say. He is also likely to call again for higher taxes on the wealthy - despite consistent Republican opposition - and speak of further pressure on China over its currency and trade practices. While these initiatives do not offer a quick fix for high unemployment that threatens Obama's re-election prospects, his speech will be a chance to turn up the heat on an unpopular Congress and take control of the campaign narrative. It will also be a high-profile platform for Obama to draw contrasts with his Republican challengers, casting himself as champion of the middle class while painting them as the party beholden to the rich. "We can go in two directions," Obama said in a video preview of his third State of the Union speech. "One is towards less opportunity and less fairness. Or we can fight for where I think we need to go: building an economy that works for everyone, not just a wealthy few." The White House hopes that argument will be buttressed even before Obama speaks. Republican Mitt Romney, one of the wealthiest men to ever run for the White House, released tax records demanded by his party rivals that indicated he will pay $6.2 million in taxes on a total of $42.5 million in income over the years 2010 and 2011. Republicans accuse Obama of being an old-fashioned tax-and-spend liberal whose policies have hurt the U.S. economy and charge that he is playing the politics of envy whereas what Americans really care about is jobs. Polls show that most Americans disapprove of Obama's handling of the economy, and his approval numbers have languished below 50 percent. But surveys show Congress far less popular, with many blaming Republicans more for the gridlock in Washington. TENS OF MILLIONS WATCHING When Obama takes the podium in the Republican-controlled House of Representatives, he will be speaking to his biggest television audience until he addresses the Democratic convention in September. Nearly 43 million people watched his 2011 address. Though he has built his re-election effort around a strategy of blaming Republicans for obstructing economic recovery, he faces the challenge of striking a balance in the speech between partisan rhetoric and calls for cooperation across party lines. If he goes too hard, he risks alienating independent voters. Still, Obama is expected to strike a sharper tone than in last year's State of the Union when politicians kept hostilities under wraps in the aftermath of an assassination attempt on Arizona lawmaker Gabrielle Giffords. But the atmosphere in Washington is more strained now after a summer of congressional battles and with the volatile Republican presidential race moving into high gear. Even though Obama's legislative agenda is largely stalled and his go-it-alone options are limited, he is determined to show voters he has not given up. Obama is expected to push incentives to encourage lenders to refinance underwater mortgages, which would ease a crucial obstacle to a recovery in housing and the broader economy. But his advisers have been at odds over how far to go on this. He has also signaled he will put forward tax breaks to reward companies for keeping jobs home while eliminating tax benefits for those that outsource jobs overseas. Obama may also revive his call to rewrite the tax code to adopt a so-called "Buffett rule," named after the billionaire Warren Buffett, who supports the president and says it is unfair that he pays a lower tax rate than his secretary. That could be a subtle reminder to voters who learned on Tuesday that Romney, a former private equity firm chief, and his wife paid an effective tax rate of 13.9 percent in 2010 and expect to pay a 15.4 percent for 2011 - tax rates that are far below the top rate of 35 percent on ordinary wages. Valerie Jarrett, a senior adviser to Obama, said on CNBC, "The president this evening will outline in more detail his broad parameters for a tax climate that is fair and equitable, and he will focus specifically on the Buffett rule that he announced a while ago. He'll go in more detail this evening about that." Obama plans to echo themes he laid out in a speech in Kansas in December when he railed against economic inequality. The White House believes it strikes a chord with working-class voters who have seen their incomes flatline and supporters of the "Occupy Wall Street" movement that has spread since last year. Neera Tanden, who served in both the Obama and Clinton administrations, said the issue of economic fairness increasingly seemed to resonate with Americans and it could be an important theme for Democrats in the election. "People aren't just unhappy that they're not doing well. They're unhappy that other people are doing well at what they think is their expense," said Tanden, who is now president of the Center for American Progress. The morning after his address, Obama will launch a three-day, cross-country swing through five election battleground states to promote and detail his new proposals. In Iowa and Arizona on Wednesday, Obama will focus his message on manufacturing with a call for more jobs and more "made in the U.S.A. products," according to a senior administration official. He will discuss energy issues in Nevada and Colorado on Thursday followed by a focus on college costs in Michigan on Friday.

2012 General Assembly: Senate OKs its 'right to work' bill - Chris Sikich and Mary Beth Schneider - INDYSTAR.COM 24-January-2012 Indiana took a big step toward becoming the 23rd state in the nation with the controversial "right to work" law on the books, as the Senate passed the measure late Monday. The House could vote on an identical version of the bill today -- if, that is, enough House Democrats are present to let a vote take place. Democrats have repeatedly shut down the House this session, denying Republicans the quorum they need to do business, and they went behind closed doors again late Monday. When Republicans get to take votes on this bill, they have the numbers to win. They proved it in the House on Monday, as they rejected every amendment Democrats offered, including one proposal to let voters decide the issue in a referendum. And they proved it in the Senate, which voted 28-22 for the bill, with nine of the 37 Republicans joining all 13 Democrats in opposing it. Under the bill, companies and unions could no longer negotiate contracts that require employees to either join a union or pay fees for representation. Thousands of labor union members packed the House and Senate galleries and filled the hallways outside both chambers Monday. About 110 union members from a Munster laborers union even went to the home of House Speaker Brian Bosma, R-Indianapolis, to protest the bill. "Mr. Bosma and the Republican Party have made it their intention to hit us at our dinner table, so that's where we want to hit him," said Kevin Roach, business manager of Laborers' International Union Local 41. Bosma, though, said later: "This isn't my first time to be intimidated or bullied about. It's not going to stop anything." That was clear in the Statehouse. For nearly two hours in the Senate, lawmakers from both sides of the aisle argued passionately, each side citing statistics crafted to back its views. As union protesters chanted "You lie" outside the Senate chambers, bill author Sen. Carlin Yoder, R-Middlebury, said the legislation will lower unemployment and result in higher-paying jobs. "We've heard the argument that 'right to work' really means right to work for less," he said, "and I respectfully disagree with that." But Democrats said the legislation is instead an escalator taking Indiana down to lower-paying jobs and unsafe working conditions. Senate Minority Leader Vi Simpson, D-Ellettsville, said lawmakers should legislate by evidence and not anecdote. There's no solid data proving that "right to work" laws lead to economic development, she said. " 'Right to work' is nothing more than a race to the bottom for the middle class of Indiana," she said. Senate President Pro Tempore David Long, R-Fort Wayne, said the conflicting data can be confusing, but he urged the senators to vote "yes." It might not be the answer for job creation, he said, but he thinks it can be a game changer. "We have to scratch and claw and fight for every job that we create here," he said. Sen. Tim Lanane, D-Anderson, who said his father was a union man, said the legislation is nothing more than an attack on the working class. "The bottom line is this is an anti-union bill, and my father will not allow me to vote for it. . . . God rest his soul." In the House, Democrats tried to make Republicans stand by their glowing predictions. If this bill will boost incomes and jobs, they said, then state in the bill that the law will expire if they don't materialize. Republicans brushed those concerns aside with virtually no comment. But both sides argued for about two hours over whether voters should have the final say. House Minority Leader B. Patrick Bauer, D-South Bend, shouted at the Republicans: "You're hiding if you don't believe (the public) should have a voice!" Rep. Sean Eberhart, R-Shelbyville, was among several Republicans who said lawmakers are elected to make tough choices. As the referendum amendment was defeated by a party-line vote of 59-39, Bosma twice asked whether there were more amendments, then gaveled the bill closed. Democrats left the floor, and when they did not return, Bosma adjourned the House to try to come into session again at 1:30 p.m. today. "They had their opportunity to offer amendments. I gave them six full seconds, which around here is an eternity," Bosma said later. Bauer said at least one Democrat was waiting to offer an amendment. Democrats will decide today whether to hold out longer, he said. If they come to the floor, the House might take a vote on "right to work," Bosma said. If there isn't a quorum, Republicans will seek to fine Democrats an additional $1,000 each.

Library union approves contract - By Kym Soper - The Journal Inquirer 24-January-2012 MANCHESTER — The library union has voted to accept a three-year contract that members had previously rejected last month. A state mediator helped the town and union resolve concerns, and town officials learned of the union vote last week, Dede Moore, director of administrative services, said today. There were no major changes to the package, which gives staff a 1.5 percent pay raise with step increases for eligible workers in each of the next three years. “Some language was clarified, so it doesn’t have to go back to the Board of Directors” for approval, Moore said. The directors voted unanimously in favor of a tentative agreement at their Dec. 6 meeting, but the pact was rejected two weeks later by the 21 members of the Manchester Library Union, Local 991 of the American Federation of State, County, and Municipal Employees. Mayor Leo V. Diana said the problem was a section allowing non-bargaining part-time workers to be called in first when a worker is sick rather than the current practice of offering the time to higher-paid union staffers. Moore said the hours needed to be spelled out in that section of the contract. The new language allows for “replacing part-timers with part-timers Monday through Thursday from 5 p.m. to 9 p.m.” Moore said. Thomas Stough Jr., union president, could not be reached for comment. Diana said the union’s first vote was “a minor setback” that was easily resolved. “I’m happy everything worked out and it’s moving forward,” Diana said, adding, “I think, in the overall scheme, this won’t affect taxes in any way. It’s consistent with other contracts in other unions.” Library staffers have been working without a contract since July 1, and the pay increase is retroactive to that date. The contract will run from July 2011 to June 2014 and will go into effect immediately. Under the contract some staffers will see an increase in health insurance costs, from a 5 percent contribution to 8 percent. Others who now pay between 10 to 18 percent for coverage will see no change, however, as the town attempts to slowly bridge that gap. All unionized library workers would see their emergency room co-pay increase from $50 to $75 under the contract. Salaries for union library members range from $33,951 to $69,010 annually. The impact to the town’s budget remains the same: an added $40,000 over the three years of the contract, Moore said. Town officials noted that the library lost a position last year through attrition, and the savings there would pay for the cost increase. In June 2010 the library workers’ union renegotiated wages and step increases in a contract re-opener allowed in the third year of their previous negotiated contract, which ran from July 1, 2010 ,to June 30, 2011. That agreement had give-backs that avoided an unpaid furlough day and kept the general wage increase at 1 percent for six months of that fiscal year. All town unions and unaffiliated staffers went without a raise in 2010 in order to prevent layoffs and cuts to services. Similar concessions were made in 1991 and 2002.

Malloy Calls For Funding State Pensions - By CHRISTOPHER KEATING - The Hartford Courant 24-January-2012 HARTFORD— Just days after a key Wall Street rating agency downgraded the state's bonds, Gov. Dannel P. Malloy called upon the state legislature to pour more money into the state pension plan. Malloy said his actions had nothing to do with the downgrade by Moody's Investors Service, and instead was an action that he wanted to make for more than a year. Moody's said flatly that one of the reasons for the downgrade was Connecticut's "pension-funded ratios that are among the lowest in the country and likely to remain well below average.'' State employee unions were pleased by Malloy's move, which requires their approval. Specifically, Malloy wants to eliminate some provisions of an agreement the State Employee Bargaining Agent Coalition, known as SEBAC, that were reached with then-Gov. John G. Rowland in 1995 and 1997. Top union leaders, including Sal Luciano of AFSCME Council 4, attended the announcement outside the governor's Capitol office. In the short term, the state must come up with a payment of $125 million in the first year. Malloy did not reveal exactly where that money will be coming from, saying that all the budget details will be unveiled to the state legislature on opening day of the General Assembly session on Wednesday, February 8. As such, the state will be putting money into the plan earlier than originally projected. "This is the rough equivalent of starting a 401 (k) payment plan when you are 20, not 55,'' Malloy told reporters Monday. The full savings will not happen for 20 years, which House Republican leader Larry Cafero of Norwalk said raises questions about the long-term commitment of legislators to keep funding the pension program. "Many of them know they won't be around for 20 years,'' said Cafero, one of the longest-serving legislators. He predicted that legislators would move to fund the pension plan "until we have a fiscal emergency, and we'll try to find a way not to.'' When asked what will happen to the proposed savings over the next two decades if he is not governor in 20 years, Malloy responded, "Who says I'm not going to be here? Listen to yourselves. With all due respect, listen to yourselves. You're so used to other administrations defending what they were doing by putting the damage off to some future date that you're asking me why I'm not willing to do that. That's how badly broken Connecticut is. And we're fixing it. Thank you.'' Malloy's news conference ended with those words. Cafero began speaking a few minutes later, saying that he favors Malloy's idea on principle. "The principle is fantastic. We have to pay our obligations,'' Cafero told reporters outside the House chamber, not far from the governor's office. "We proposed it long before the governor was governor.'' While Malloy blamed Rowland for signing the deal with SEBAC more than 15 years ago, Cafero blamed the Democratic-controlled legislature for postponing $100 million in pension payments in the first year of the previous two-year budget in 2009 and another $100 million in the second year in 2010. In addition, Cafero blamed the Democrats and Malloy for allowing the city of Bridgeport to defer its pension contributions in June 2011. The Bridgeport pension provision was buried in section 8 of a 175-section omnibus tax bill on the expected contributions to the pensions for police and firefighters, based on language that was approved in a letter by state Treasurer Denise Nappier, a Democrat. The bill allowed the city to contribute less into the pension fund than was required. "This governor and this legislature took great pride in fully funding our pension obligations,'' Cafero said on the state House floor on June 6, 2011. "But this governor and this legislature are saying, 'We could do it, but if you're a city out there and you're up against it, you don't have to.' ... Yet we, as a state, are sanctioning the very thing that this governor said he would never do - underfund your pension obligation.'' Malloy's senior adviser, Roy Occhiogrosso, responded in June that: "It's not the ideal situation. No one disagrees with that. But we don't live in the ideal world. We live in this world, and Bridgeport is facing some unique challenges. ... I'm glad that Representative Cafero acknowledges what Gov. Malloy is doing to stabilize the state's finances.'' On his radio program on WTIC-AM on Monday afternoon, Rowland read directly from Malloy's press release and read a series of his quotes at the end of the second page of the release. "We just got downgraded by the ratings agency,'' Rowland said on the air, rejecting Malloy's statements that there had been "tough spending cuts'' in the budget and that GAAP had been implemented. "It's gall.'' Regarding the Moody's downgrade and Malloy's press conference Monday, a Republican insider said, "Clearly, they're panicked on this whole thing. He's back from Washington on the way to Davos.'' Senate Republican leader John McKinney of Fairfield said, "Paying off our pension debt is a good thing, but doing so outside of the spending cap shows that Governor Malloy is still not serious about reducing unnecessary state spending and, further, that he is not serious about pension reform. Clearly, his deal with SEBAC failed to adequately deal with our long term indebtedness. Real leadership requires real reforms and that is what is needed in these difficult times."

Malloy unveils plan to reverse two decades of damage to employees' pension fund - By Keith M. Phaneuf and Mark Pazniokas - The CT Mirror 24-January-2012 Gov. Dannel P. Malloy unveiled plans Monday to reverse nearly two decades of budget gimmicks that leave the state facing huge payments over the next two decades to sustain Connecticut's grossly underfunded state employee pension fund. But while Malloy touted potential long-range savings, they come with a high price that must be paid up front: an extra $3 billion in pension payments between next fiscal year and 2023. After 2024, the contribution would drop annually, and by 2031 Connecticut would be $5.8 billion ahead. Malloy's proposal drew a strong endorsement from union leaders and a mixed review from a Republican critic. House Minority Leader Lawrence F. Cafero Jr., R-Norwalk, said Malloy's pension concerns are well-placed, but he questioned whether the fiscally strapped state is ready to make its first extra payment of about $123 million in the fiscal year that begins July 1. "We proposed it long before the governor was the governor," Cafero said of the need to better fund pensions. "So, I certainly applaud the governor for his efforts." Malloy, a Democrat who contrasted his approach to pensions with that of his two Republican predecessors, said the state cannot afford to delay stabilizing the pension fund. "I made it clear from the day I took office that I am committed to ending years of bad financial practices and getting the state's fiscal house in order," Malloy said. "We have made enormous progress on that front, and in doing so we've begun to stabilize the state's finances. ... But there is more to be done on this front." At stake is a pension fund that plunged to its lowest level in more than two decades by mid-2010, holding enough assets to cover just 44 percent of its obligations. A new report released earlier this month found that by June 2011 the funded ratio had climbed to nearly 48 percent due to healthy investment earnings and some new pension restrictions Malloy negotiated with employee unions last spring. But fund analysts typically cite a funded ratio of 80 percent as a healthy level. The pension fund has suffered from an array of questionable fiscal policies since it began in the mid-1980s with a huge financial hole. For nearly four decades before that, Connecticut had put nothing away, and therefore gained no investment earnings, to help cover pension costs. Several early retirement programs and pension fund raids under previous governors and legislatures to help balance the state budget also have weakened the fund. And the linchpin of Malloy's plan is to reverse an agreement reached in two stages, in 1995 and 1997, by then-Gov. John G. Rowland and the unions that put the pension program on what amounts to a balloon mortgage schedule. The two sides agreed to abandon a pension fund contribution schedule that required largely equal payments, with annual inflationary adjustments, over the next 30 years to eliminate the unfunded liability. In its place they imposed a system of ever-escalating payments. Although payments were lowered in the short-term, they have been increasing dramatically since the late-1990s. The state's annual contribution to the pension fund, which stood at $844 million last year and is $926 million this year, is on pace to top $1.5 billion in 2019, $2 billion by 2024, $3 billion by 2029 and approaches $4.5 billion in 2030. Reversing the actions taken in 1995 and 1997 would cost an extra $123 million starting next fiscal year. After that, Malloy also would gradually increase annual pension contributions further -- beyond contractually required levels -- starting in 2014, with the goal of funding 80 percent of all pension obligations by 2025 and 100 percent by 2032. The governor's plan also would exempt all contributions above contractually required payments from the constitutional spending cap. "It's no honor to have the worst-funded pension program in the country," Malloy said. To relinquish that "honor," Malloy must find the significant dollars in his next state budget. Technically, Malloy already has the funds he needs to begin making that extra $123 million payment. The preliminary $20.4 billion budget adopted last summer for the 2012-13 fiscal year was designed with a built-in $496 million surplus. But that budget, and the $20.14 billion plan approved for the current fiscal year, are facing their own problems, due largely to state income tax revenues falling well short of initial projections. The administration reported last week that the current budget, which was supposed to finish $88 million in the black, now has lost nearly all of that cushion, and is on pace to finish with a $1.4 million surplus. In addition, the surplus projected for next year is down below $250 million. Further compounding problems, Malloy also needs to find an extra $75 million this year and $50 million next year to continue the ongoing conversion of state finances to Generally Accepted Accounting Principles. GAAP rules are a series of common financial guidelines established by the Government Accounting Standards Board to emphasize transparency. The Malloy administration estimated in its Fiscal Accountability report in mid-November that state government would need another $1.7 billion in its coffers to cover all its obligations under GAAP rules. And that differential grows annually due to inflation. The $125 million Malloy needs would not reduce that differential, but merely would cover inflationary costs and effectively stop it from growing. "We are realigning our budget objectives," Malloy said. The governor, who signed more than $1.5 billion in new state taxes into law last spring to help close a record-setting budget deficit, said Monday he would not seek to raise additional taxes to cover his pension proposal. Cafero said it is "great news" that Malloy wants to end decades of inadequate pension funding, but the governor should have considered asking the State Employees Bargaining Agent Coalition to consider other changes to worker benefits. "Are there other provisions in SEBAC that can be revisited?" Cafero said. The concessions package Malloy negotiated with unions last year included a two-year wage freeze, restrictions on retirement benefits, a new employee wellness program and other changes. But it also prohibits Malloy from laying off most unionized workers for four years -- a component Cafero has criticized on several occasions. "Paying off our pension debt is a good thing, but doing so outside of the spending cap shows that Governor Malloy is still not serious about reducing unnecessary state spending and, further, that he is not serious about pension reform," added Senate Minority Leader John P. McKinney, R-Fairfield. "Clearly, his deal with SEBAC failed to adequately deal with our long term indebtedness. Real leadership requires real reforms and that is what is needed in these difficult times." Malloy's plan, which still needs approval both from unions and from the state Retirement Commission, drew praise Monday from labor leaders. "It was the responsible thing to do," said Salvatore Luciano, director of one of the largest bargaining units in state government, Council 4 of the American Federation of State, County and Municipal Employees. "This has real long-term implications" both to stabilize pensions and to save state government funding, added Robert Rinker, director of CSEA-SEIU Local 2001, formerly the Connecticut State Employees Association. American Federation of Teachers President Sharon Palmer said not just state officials, but unions as well, were guilty of turning too easily to fiscal gimmicks in the past. "We became so accustomed to small ideas and quick fixes," she said, "that we were unable to think any other way. This (proposal) is so important and it makes perfect sense." Malloy's proposal comes as he is about to leave for a prestigious economic conference and after a week of difficult financial news for Connecticut: the state's financial cushion is shrinking, and a ratings agency last week downgraded the state's credit rating. The governor has accepted an invitation to participate in the World Economic Forum's annual meeting in Davos, Switzerland, beginning Wednesday. He leaves late Tuesday.

Malloy Seeks Changes To State Employee Pension Fund - by Christine Stuart and Hugh McQuaid - CT News Junkie 24-January-2012 One of the three Wall Street credit rating agencies downgraded Connecticut’s bond rating last week citing its enormous unfunded pension liability, but Gov. Dannel P. Malloy said the plan he proposed Monday to improve the pension funding ratio had nothing to do with the bond rating. Malloy released the plan to improve the woefully underfunded pensions fund at a press conference outside his Capitol office. The plan seeks to achieve 80 percent funding in 2025 and 100 percent in 2032. In order to get there, it eliminates the provisions agreed to as part of the State Employees Bargaining Agent Coalition agreement in 1995 and 1997 by then-Gov. John G. Rowland, and allows the state to increase its annually required contribution by about $125 million this year. Currently the State Employees Retirement System is funded at about 48 percent, according to the last actuarial valuation. Malloy is also asking that the spending cap be excluded from pension contributions in excess of the annually required contribution. He needs a super majority of General Assembly to approve the removal of the spending cap to these types of expenditures. In its report Friday, Moody’s Investor Services said it downgraded the state because it believed “funded ratios are not likely to improve significantly until closer to the end of the remaining amortization periods,” which is 21 years in the case of the state employees pension fund. Malloy said he actually briefed Moody’s on the pension proposal he unveiled Monday. He said he’s been working on this with his Budget Director Ben Barnes, since Barnes joined his administration last year. Malloy said he will find the additional $125 million to put toward the pension fund as part of the budget he releases on Feb. 8, but didn’t give any hints as to where the money would come from. “We are realigning our budget objects to get to this goal, which is to get to 80 percent funding by 2025,” Malloy said. “The significance of 80 percent is the standard by which states are normally rated.” He said what he’s doing is “strong and sound fiscal management that will inure to the benefit of the taxpayers to the extent of almost $6 billion.” “It is no honor to have the worst funded pension program in the country,” Malloy said. “That’s not something governor’s should aspire to; certainly not something I aspire to.” He brushed aside questions that the plan was reactionary and said he always told the media, even on the campaign trail that he was going to do this. He said he was waiting until he was able to “restack” his relationship with state employees. SEBAC leadership would have to agree to the provision, but Sal Luciano of AFSCME Council 4 and Robert Rinker of CSEA/SEIU Local 2001, who watched the press conference, said they don’t see any reason why state employees wouldn’t want the state to improve the funding ratio. “It’s the responsible thing to do,” Luciano said. Rinker agreed. He said making sure the pension fund is solvent is good for state employees. The SEBAC provisions allowed the state’s contribution to shrink so eliminating them will increase the solvency of the fund. Rinker said first provision was added to the contract when the stock market was doing well, but any gain the fund saw from a healthy stock market disappeared in 2008. House Minority Leader Lawrence Cafero said he applauded the effort but said the proposal contradicts the state’s fiscal position right now. “The governor’s plan calls for a payment $125 million. Now this is coming on the heels of his letter to us on Friday, wherein he says if you take the [Generally Accepted Accounting Principles] money out of the equation, we’re about $75 million in the hole,” he said. Without GAAP accounting, the state has a surplus of only about a million, he said. Cafero questioned where the money would come from. “He said he’s not going to raise revenues but we also learned last week, by consensus revenues, that our revenues are plummeting,” he said. “The principle is fantastic, we have to pay our obligations, but how this statement from the governor jibes with the fiscal news we learned this week, plus other things he’s stated, is still a question to be answered.” The governor’s proposal raises some other questions, he said. Malloy’s plan aims to eliminate provisions of SEBAC agreements, which were negotiated settlements, Cafero said. He questioned how Malloy could just eliminate two provisions he didn’t like. Cafero said the fact that the SEBAC agreement can be re-opened, it might be a good thing if economic conditions get worse and the state needs more savings. Former Gov. M. Jodi Rell’s agreement with the unions contained an emergency clause for such a scenario Malloy’s does not, he said. “It seems like the SEBAC agreement is still up for negotiation. If that’s the case and we do have an economic downturn that we all hope we don’t have, but if we do have it, would that mean the unions would come back to the negotiations table?” he asked. Sen. Minority Leader John McKinney, R-Fairfield, said he agrees with Malloy that “paying off our pension debts is a good thing.” However, “doing so outside of the spending cap shows that Governor Malloy is still not serious about reducing unnecessary state spending and, further, that he is not serious about pension reform.” He questioned why Malloy didn’t handle the situation when he negotiated health and pension benefits with SEBAC this summer. “Clearly, his deal with SEBAC failed to adequately deal with our long term indebtedness. Real leadership requires real reforms and that is what is needed in these difficult times,” McKinney said. As part of those negotiations Malloy asked all state employees to contribute 3 percent of their salaries for 10 years to the “other post retirement benefits,” which includes mostly retiree health care benefits. That portion of the pension fund is underfunded to the tune of $26 billion and accounts for a greater portion of the state’s unfunded liabilities. Malloy said he believes the 3 percent contribution from all state employees adequately addressed the deficiency in that account.

Malloy proposes plan to shore up pensions - The New Haven Register 24-January-2012 HARTFORD — Gov. Dannel P. Malloy unveiled a plan Monday to speed up state payments to Connecticut’s seriously underfunded state employee pension system, a move he said will ultimately make it fully funded by 2032. The state’s pension fund has less than 48 percent of the money it needs, ranking it among the worst in the nation. “We need to be fiscally strong. We need to repair the damage that was done by successive administrations in this state,” Malloy told reporters during a news conference outside his state Capitol office. “It is no honor to have the worst-funded pension program in the country. That’s not something governors should aspire to.” The Democratic governor’s proposal calls for the state to contribute about $125 million more next year and in future years. Malloy said he will reveal next month, when he addresses the General Assembly on Feb. 8, how he expects to cover that first payment. Malloy is expected to propose revisions to the second year of the two-year, $40 billion state budget approved last year by the Democratic-controlled General Assembly. He said he doesn’t intend to raise taxes any further to cover the extra pension payment. He said he hopes the pension plan will be 80 percent funded — the standard for public plans — by 2025. Besides legislative approval for the additional payments, Malloy’s plan also requires the approval of state employee union leaders, who said they are supportive of the move. Sal Luciano, executive director of AFSCME Council 4, said Malloy’s plan will ensure that state employees’ pensions will be there for them in the future. He likened the proposal to keeping up with maintenance on a vehicle. “Essentially what the governor is doing, if you think about a car, you might save some money if you don’t change the oil in the car, but you blow out the engine,” Luciano said. Malloy has been critical of the agreements reached between former Republican Gov. John G. Rowland and the state employee union leaders back in 1995 and 1997, which included an early retirement incentive program and allowed the state to defer most of its unfunded pension liability into the future. It required a hefty, one-time payment of $4.5 billion in 2032 to fully fund the pension plan. Robert Rinker, executive director of CSEA/SEIU, Local 2001, formerly the Connecticut State Employees Association, said actuaries for both management and labor OK’d the approach at the time, saying it was sound given the direction of the stock market. But Rinker said the state’s pension fund was then hit hard when Internet and technology stocks sank in 2000 and the stock market crashed in 2008. Malloy’s plan came days after Moody’s Investment Services announced it had downgraded Connecticut’s debt rating. Analyst Nicole Johnson said the governor has made positive steps, but said “it’s going to take a long time to undo the problems they’ve gotten themselves into,” referring to the state’s unfunded pension liabilities, cost of high borrowing and a lack of a rainy day fund. “When we look at all of Connecticut and compare it to its peers, other states, it is an outlier in terms of those fixed costs, and we don’t expect those fixed costs to come down significantly over the near term,” Johnson said. Malloy said the timing of his pension proposal has nothing to do with the Moody’s downgrade. House Minority Leader Lawrence Cafero Jr., R-Norwalk, said the GOP supports shoring up the pension. However, he questioned where the additional payments will come from, given recent news that state revenues have dropped and additional spending cuts are needed. “The principal is fantastic. We have to pay our obligations,” he said. “But how this statement by the governor jibes with the fiscal news that we learned this week, plus the other things he’s stated, is still a question to be answered.”