Politics & Government
Scanlon is optimistic about Connecticut's economy
Comptroller says state will continue to pay down pension debts
By Scott Benjamin
HARTFORD – In the state comptroller’s office there is a framed photograph of Abe Ribicoff and Bobby Kennedy.
“Ribicoff and Kennedy stood up for what is right,” exclaims Sean Scanlon, who was born after their hey-day in elected office.
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“They tried to help people,” added the state comptroller, who is 36 years old. “They focused on issues that weren’t always the focus of the day and they used their positions to draw attention to things that weren’t what rank and file politicians pay attention to.”
Scanlon said Ribicoff was “probably the best governor, we’ve ever had in Connecticut, and certainly my favorite governor.” Ribicoff served in that office from 1955 to 1961 and later served three terms in the U.S. Senate.
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Scanlon said he was inspired toward public service after writing a book report on Bobby Kennedy at Guilford High School.
“I just became really moved by how you could get this job where you could help people,” Scanlon said in an interview with Patch.com
The late Dick Schapp, who was most noted for writing and broadcasting sports, did a biography on Kennedy in 1967.
Schapp once said, “One night Bobby asked me about if there was a difference between covering athletes and covering politicians. I said there really is no difference other than that the athletes aren’t smart enough to lie.”
Schapp said Kennedy replied, “Well everyone in your business is a liar.”
Liars or not, Scanlon gravitates toward reporters.
Brian Shactman, the WTIC talk radio host, said in March on the WTNH-Channel 8 Capitol Report that Scanlon appears to be a rising star in state politics.
Even more notably, Scanlon canvasses the rank and file voters.
State Rep. Bob Godfrey (D-110) of Danbury, who served with Scanlon in the lower chamber, said in a phone interview with Patch.com, “He understands the nuances of policy and how it impacts people, not statistics.”
In an e-mail message to Patch.com, Democratic State Central Committee member Audrey Blondin of Goshen added, “He understands the importance of being and staying in contact with constituents and political leaders all across the state from the smallest towns to the largest cities and has always made it a point to be accessible and approachable by all."
Who does Scanlon most admire among the contemporary office-holders?
“Chris Murphy,” the state’s junior U.S. senator.
He worked in Murphy's office for 10 years.
“Chris knows how to listen, and Chris always prioritized listening,” commented Scanlon.
Murphy has said if you are not canvassing voters you are going to get “a skewed perception” of how to serve them.
Since being elected to the U.S. Senate in 2012, he has done an annual walk across Connecticut.
Said Scanlon, “People would talk to him that wouldn’t talk to him if he was wearing a suit at a formal event.”
As he campaigned for comptroller last year he urged applicable residents to “sign up” for the child care tax rebate that he helped author in the General Assembly.
Scanlon said the rebate of up to $750 per household helped families manage their budgets.
“In every instance it wasn’t frivolous things,” he explained. “It was buying groceries. It was buying gas when gas was very expensive. Paying their rent. All things that were essentials.”
“This was the single best way to help middle class families make life more affordable and help them during a challenging time,” said Scanlon.
He said that more than 300,000 children benefitted.
“I think there are a lot of people in both chambers and in both parties that think this is a good policy that we should be continuing,” said Scanlon.
In an e-mail message to Patch.com, state Sen. Stephen Harding (R-30) of Brookfield concurred: "The child tax credit helped put money back in the pockets of many hard working, middle class families throughout the State. This is a policy I fully support and would strongly advocate for my fellow colleagues in the legislature to continue to this credit into 2023.”
However, Hugh McQuaid of CT News Junkie recently reported that the child tax rebate was not included in the budget package that the General Assembly's Finance, Revenue and Bonding Committee recently approved.
Since taking office in January, Scanlon has traveled through Connecticut to garner more enrollment for MyCTSavings.
The retirement plan was adopted in 2016 and is now underway in earnest for the first time.
Companies with at least five employees must notify the comptroller's office that they have a retirement plan or sign-up for MyCTSavings, where workers place three percent of their earnings into a retirement account.
Scanlon said the number of businesses enrolled increased from 800 to 3,500 in three months. The initial deadline of March 30 has been extended to August 31. There is no penalty on employers for not complying.
Scanlon is optimistic about Connecticut’s economy, which had contracted by eight percent between 2008 and 2016, according to the 2018 report from the state Commission on Fiscal Stability and Economic Competitiveness.
“The fiscal guardrails have taken Connecticut to the point where it is out of the dark period of the 2010s – the Lost Decade,” he remarked.
Those guardrails were approved in the 2017 bipartisan budget agreement and include caps on spending and a mechanism to automatically put surpluses into the rainy-day fund.
However, Donald Klepper-Smith, the economist for the Greater Danbury Chamber of Commerce who had headed former Gov. M. Jodi Rell’s (R-Brookfield) economic team, has told Patch.com that Connecticut’s economy is “not as rosy” as has been projected since the federal assistance from the pandemic, which is about to expire, has been the prime reason for the recent surpluses.
Scanlon said that is “a big misconception. I dispute that. In my opinion we will continue to be in that position because of those guardrails. In my personal opinion those have borne the situation we’re in much more than any federal aid, although that has helped.”
Godfrey commented, “I would give an equal review to both those factors. I think it is six of one and half a dozen of the other.”
Scanlon noted that there is a $1.4 billion projected surplus for the fiscal year that ends of June, which would make it five consecutive years of surpluses. He said even though the Federal Reserve Board has been increasing interest rates for more than a year Connecticut residents have continued to spend money at a healthy rate.
“I’m not saying we’re anywhere near where we need to be,” Scanlon said. “But if you look completely at where we were five years ago, we’re leaps and bounds ahead of that .”
In an e-mail message to Patch.com, Wesleyan University Economics Professor Balazs Zelity stated, "There is no doubt that Connecticut is in a better place than where it was five years ago. The state has been adding jobs at a rate similar to the national average since the onset of COVID. GDP has been growing, though the Q4 2022 growth rate has been among the lowest in the country due to weakness in the financial sector."
Greenwich hedge fund manager Red Jahncke wrote in a recent Waterbury Republican-American column that Connecticut tax revenue is likely to plunge in the last four months of the current fiscal year, taking annual tax revenue down about $1.1 billion below the official forecast.
Zelity wrote, "Connecticut's government revenues are among the most volatile in the US, so fluctuations in capital gains are to be expected. The state's rainy day fund should be sufficient to address this issue, absent a deep recession."
He added, "Connecticut has had some of the largest budget surpluses in the U.S. for the past five years. It must be noted though that the state remains one of the most indebted in the nation with a relatively low credit rating."
Keith Phaneuf of CT Mirror reported earlier this year that the state employee pensions were only 46 percent funded. That is an improvement over the 29 percent figure cited in the 2018 report by the state Commission on Fiscal Stability and Economic Growth. However, former Brookfield Frist Selectman Steve Dunn, a Democrat, has told Patch.com that the typical benchmark in the public sector is 80 percent.
Scanlon commented that the state has paid down $6 billion in the pension obligations over the last three years and is on track to pay another $3 billion this fiscal year.
“That is a bigger contribution than you made in [previous] 70 years in the pension fund,” he declared.
Scanlon said. “If we stay the course over the next 10 years [with the fiscal guardrails], we will take a significant chunk off that pension debt. The arc will be closer to the funding ratios that we all want to see.”
However, Harding has told Patch.com that although the state took a stride forward in establishing a hybrid pension plan, instead of a direct benefits package, for the new state employees in the 2017 collective bargaining agreement it would have been better to have adopted the even less-expensive direct contributions system.
Scanlon acknowledged that direct contributions has become more common in the private sector.
“I don’t think that anyone is suggesting that there are more changes to be made,” he said regarding the state employee benefits.
“Right now we have a good balance,” said Scanlon, noting that the state employees made serious concessions during negotiations in 2009, 2011 and 2017.
Lamont and former Gov. Dannel Malloy (D-Essex) have suggested that the municipalities take on some of the payment for the public school teachers' pensions, which the state has paid for since 1939.
Phaneuf of CT Mirror reported in 2019 that then-Office of Policy and Management Secretary Melissa McCaw said that staying on a schedule of rapidly escalating payments into the teachers’ pension “is simply too risky.” Contributions to this pension alone could eat up 20 percent of the entire General Fund a decade from now.
“I did not support that [having the municipalities pay for part of the teacher pensions] as a legislator when that proposal was made,” Scanlon remarked. “I don’t support it today.”
He noted that the state did not place any money toward the teachers' pensions from 1939 through 1971. Phanuef of CT Mirror has reported that they are currently 57 percent funded.
“It is not the fault of the towns and certainly not the teachers that the state mismanaged that fund over decades,” Scanlon said.
“The best way to deal with this is to continue to pay our bills, do whatever we can to put more money towards that fund than we have in previous years. And in time the problem will go away,” he said.
Scanlon said having the municipalities pay part of the teacher pensions would force municipalities to increases their property taxes.
“Property taxes are the most onerous taxes that we have in Connecticut,” he declared. “The single biggest reason that we ware are not where we should be as a state. It is a system that is broken and should be reformed.”
Bill Curry of Farmington, the former two-time Democratic gubernatorial nominee, was calling for property tax reform 30 years ago when he was the state comptroller. Why has it not been approved?
Said Scanlon, “It is the third rail of Connecticut politics.. We have 169 fiefdoms in Connecticut. Everyone loves their town, and I certainly love the town I live in. If you look at any other state in America, you see it is a very inefficient way to govern.”
“We have no regional forms of government in Connecticut, dating to the 1960s,” he added. “My solution is that we need to incentivize towns to find efficient savings” such as sharing libraries or dog catchers.
Scanlon recently established a working group to address surges in the Connecticut Municipal Employees Retirement System. Some municipalities are experiencing a surge in pensions costs.
Phaneuf of CT Mirror reported that Betty Gara, the executive director of the Connecticut Council of Small Towns has warned that the "system is broke" and municipalities may have to have fewer employees.
Scanlon remarked, "The last thing I want to see” is a reduction in personnel.
He said he expects the working group to propose a "series of reforms" that will be considered by the General Assembly and make the system "healthier."
Connecticut has fewer people employed now than it did in 1989.
There was considerable growth in the 1990s and early 2000s in entertainment with the establishment of the Mohegan Sun and Foxwoods casinos in the southwestern part of the state and the continued expansion of ESPN in Bristol.
Former U.S. Sen. Joe Lieberman (D-Stamford) said in 2006 that in 25 years there would be more people employed in fuel cell technology than any other sector of Connecticut’s economy. That isn’t going to happen.
What does Connecticut need to do in 2023?
Remarked Scanlon, “I think it is reinventing ourselves.”
“I think the biggest place we’re primed for growth is around our cities,” he explained. Scanlon said there is job growth in New Haven and Stamford “because innovation and entrepreneurship is being encouraged and happening.”
“There is not enough [bio-tech] space in Guilford, Branford and New Haven to meet the demand that we see from that sector of the economy,” Scanlon exclaimed.
Scanlon said that he supports state Sen. Ryan Fazio's (R-36) of Greenwich proposal to change state job listings to not indicate a requirement for a college degree when one is not actually needed to perform the work.
“There are a lot of people out there with no college degree, but have a lot to offer,” he said. “Not having a college degree should not be a determining factor in your having the ability to show what you can offer in the work force.”
A tiny number of states have already taken that step, which Scanlon believes could lead to similar policies in private industry.
On another topic, CT Hearst columnist Dan Haar has reported that during his eight years as governor, 2001 to 2019, Malloy trimmed the full-time state work force by 13.1 percent.
Should further reductions be made now?
“I think we need to figure out what the next iteration of our state work force is going to be,” explained Scanlon.
“We don’t have enough employees to meet the needs of the state,” he explained, noting that he has done a job shadow with state Department of Transportation workers during a snow storm and saw the number of hours of overtime that they had to work.
“That may mean that we need to hire more employees for the state,” he said. “That may not be bad from a fiscal perspectives” since in some instances it would eliminate overtime costs for higher-paid veteran state employees.
What about the potential impact of artificial intelligence (AI)?
“I’m a bit concerned about AI and the role that it can play,” exclaimed Scanlon “I think that we need to learn more about that before we unleash AI as a way that we’re doing daily the state’s business.”
On another topic, Democrat Kevin Lembo of Guilford, who was the state comptroller from 2011 to late 2021, sought to establish a public health insurance option.
Jenna Carlesso of CT Mirror reported in 2021 that “ultimately, Lembo and lawmakers have said, [Lamont]refused to sign the bill after pushback from [Connecticut’s insurance] industry.”
Reportedly there are 18 major insurance companies with a presence in the metro Hartford area.
Said Scanlon, “I was a lead proponent for that as a legislator. I still think it is a good idea. It is still something that I support."
“It is not something that I am focusing my time on right now because I think we need to look at other ways to get to the same goal of getting people to get affordable health care and accessible health care in a better way than we are doing today. There are challenges to the public option, there always will be.”
For example, he said that he and Lamont are lobbying the General Assembly to approve an option to offer a discount card from a national organization that could produce an “80 percent savings” on generic drugs.
Godfrey said, “My father told me that sometimes you go for a loaf of bread and you are going to have to accept just a slice. I think that Sean still sees the loaf but he is building toward it piece by piece.”
What did Scanlon learn at Boston College that has helped him in his career in government.
He said he benefitted from the university’s fundamental principle: “How can we help other people."
Scanlon commented, "That sort of is the Jesuit philosophy.”
Stamford Mayor Caroline Simmons, a Democrat, told Patch.com in 2021 that in majoring in Political Science at Harvard and then later serving as an elected official she found that there is a tremendous disconnection between what is taught in the classroom and what happens in government.
Scanlon, who majored in Political Science, remarked, “In some ways, I learned more doing internships at BC for city councilors and state senators than I did in studying Political Philosophy. I think we are really far away from the age of Socrates and John Locke, who are important to study. But the real world of politics in 2023 is vastly different than political theory.”
Resources:
https://ctmirror.org/2021/08/2...
https://ctmirror.org/2019/02/1...
Interview with Sean Scanlon, Patch.com, April 11, 2023.
Phone interview with Bob Godfrey, Patch.com, April 17, 2023.
E-mail message from Audrey Blondin, April 14, 2023.
E-mail interview with Stephen Harding, April 13, 2023.
E-mail interview with Balazs Zelity, April 13, 2023.
https://www.wtnh.com/video/cap...
https://ctmirror.org/2023/03/1...
https://patch.com/connecticut/...
The Newtown Bee, July 10, 1992, on Dick Schapp.
https://ctmirror.org/2020/11/2...
https://ctmirror.org/2021/08/2...
https://patch.com/connecticut/...
https://ctmirror.org/2023/03/1...
https://ctnewsjunkie.com/2023/...
https://patch.com/connecticut/...
