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Old 05-04-2021, 06:52 AM
 
Location: Ubique
4,316 posts, read 4,168,786 times
Reputation: 2822

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Quote:
Originally Posted by JayCT View Post
I don’t think that is correct. As I remember the pension problem in Connecticut most significantly impacts the State budget over the next few years but by 2030 it drops significantly as new state retirees are covered under more self funded retirement plans implemented in the 1990’s. The budgets of Malloy and Lamont get us over the worst of the pension hump so it’s impact will lessen in the coming years. This is part of the reason why our Rainy Day Fund is exploding with nearly $4 billion. Jay
CT's Rainy Day Fund is "exploding" because of NYers' exodus and BS money Feds handed out to CT. Pensions play no part.

And btw, it's not in the next few years when pensions' picture starts to improve. It's more like 2035 last time I checked. And I am sure CT will figure out how to push that out. Habits don't die. CT politicians did not change out of a sudden. And yes, I have called my local reps in NH county, and now in FFC. They have never listened and never will.

 
Old 05-04-2021, 08:25 AM
 
24,509 posts, read 17,974,587 times
Reputation: 40204
Quote:
Originally Posted by Mike 75 View Post
So is there a prohibition like 2 1/2 on raising the state income tax? Because the initial CT income tax was a flat tax of 4% if I recall correctly, and we've seen plenty of increases in that rate since then, including making it progressive. Just wondering what makes Mass so different.

At this point, it doesn't seem like the CT income tax is about funding government, its about income redistribution. The state is swimming in money, revenue is through the roof, and the progressive Dems still want to raise taxes.
No. Prop 2 1/2 is strictly about local property taxes. Among other things, cars are taxes at 2.5% of MSRP on a declining schedule. In year 5, it’s the 2.5% tax on 10% of MSRP. A $40,000 car has a $100 excise tax bill once it hits 5 years old. Boats are the same. With real estate, the rate is capped at 2.5% and rate increases are capped at 2.5%. If your mill rate is $10. The most it can go up by in a year is to $10.25. Instead of a Waterbury with an insane tax rate, the state funds schools in the low tax base municipalities. Most of the failed cities have a mill rate below 2%.


The Massachusetts constitution doesn’t allow a progressive income tax. That’s the main difference. There was another ballot initiative in 2000 to reduce the flat state income tax to 5%. The legislature opted to phase it in. It finally got to 5% for 2020. Any vote to raise it gets crushed in the state legislature. The last one was in November. Defeated 127-30. Nobody wanted to get tarred and feathered by their constituents. It’s easy to pass a tax increase that only impacts rich people. It’s hard to pass a tax increase on a flat tax.
 
Old 05-04-2021, 10:26 AM
 
1,888 posts, read 1,160,253 times
Reputation: 1778
Quote:
Originally Posted by Henry10 View Post
CT's Rainy Day Fund is "exploding" because of NYers' exodus and BS money Feds handed out to CT. Pensions play no part.

And btw, it's not in the next few years when pensions' picture starts to improve. It's more like 2035 last time I checked. And I am sure CT will figure out how to push that out. Habits don't die. CT politicians did not change out of a sudden. And yes, I have called my local reps in NH county, and now in FFC. They have never listened and never will.
The problem with all this Fed money is it's being spent on things that we wouldn't have had we not had the money.
It's like you win a million in the lottery, before your just making ends meet. Now you buy a big house, take some vacas, buy some new cars etc......your right back where you started.....just in nicer digs!

DeBlasio is the poster boy for one who shouldn't be in charge of$$
 
Old 05-04-2021, 01:56 PM
 
9,783 posts, read 7,038,871 times
Reputation: 11373
Quote:
Originally Posted by GeoffD View Post
No. Prop 2 1/2 is strictly about local property taxes. Among other things, cars are taxes at 2.5% of MSRP on a declining schedule. In year 5, it’s the 2.5% tax on 10% of MSRP. A $40,000 car has a $100 excise tax bill once it hits 5 years old. Boats are the same. With real estate, the rate is capped at 2.5% and rate increases are capped at 2.5%. If your mill rate is $10. The most it can go up by in a year is to $10.25. Instead of a Waterbury with an insane tax rate, the state funds schools in the low tax base municipalities. Most of the failed cities have a mill rate below 2%.


The Massachusetts constitution doesn’t allow a progressive income tax. That’s the main difference. There was another ballot initiative in 2000 to reduce the flat state income tax to 5%. The legislature opted to phase it in. It finally got to 5% for 2020. Any vote to raise it gets crushed in the state legislature. The last one was in November. Defeated 127-30. Nobody wanted to get tarred and feathered by their constituents. It’s easy to pass a tax increase that only impacts rich people. It’s hard to pass a tax increase on a flat tax.
Geoff is close - real estate property tax revenue for a city or town cannot increase by more than 2.5% not including new construction. If a town has $1 million in revenue, it can only generate $1,025,000 the following year on the existing properties.

Budgets are set by July 1 of the tax year using the formula noted above. We don't get our assessment nor tax rate until after the second quarterly payment is made. In that time, they play around with tax rates (residential and commercial) and assessments to meet that budget numbers.

My MA House

2017
Assessment: 519,000
Rate: 11.06
Tax: 5740

2018
Assessment: 544,400 +4.9%
Rate: 10.62 -3.9%
Tax: 5782 +.7%

2019
Assessment: 570,500 +4.8%
Rate: 10.48 -1.3%
Tax: 5979 +3.4%

2020
Assessment: 636,800 10.4%
Rate: 9.64 -8%
Tax: 6138 +2.7%

2021
Assessment: 635,400 -.21%
Rate: 9.95 +3.2%
Tax: 6322 +1.3%

You can see that depending on the year, my assessment, rate, tax amount has gone up by more than 2.5%.
 
Old 05-04-2021, 03:22 PM
 
Location: Connecticut
34,637 posts, read 56,391,795 times
Reputation: 11150
Please return to the topic of the OP which is Connecticut’s Economic Climate. JayCT, Moderator
 
Old 05-04-2021, 06:08 PM
 
Location: Connecticut
34,637 posts, read 56,391,795 times
Reputation: 11150
Quote:
Originally Posted by Henry10 View Post
CT's Rainy Day Fund is "exploding" because of NYers' exodus and BS money Feds handed out to CT. Pensions play no part.

And btw, it's not in the next few years when pensions' picture starts to improve. It's more like 2035 last time I checked. And I am sure CT will figure out how to push that out. Habits don't die. CT politicians did not change out of a sudden. And yes, I have called my local reps in NH county, and now in FFC. They have never listened and never will.
Except that the exploding Rainy Day Fund was happening BEFORE the mass exodus of New Yorkers happened.

Also I distinctly remember the 2030 date. It ties to the last revision date of the state’s pension plan. The state revised its pension plan in 1984 and again in 1997. Before 1984 the pension plan, called Tier I, was insanely expensive. There are very few, if any Tier I employees left to retire and fewer each year getting benefits from it. Employees starting from 1984 to 1997 are called Tier II. It’s not nearly as expensive. In 1997 the state implemented the current plan, called Tier IIA, which is much less expensive to fund. The average state employee retires after about 30 years. That means by 2030, the state should be seeing the beginning of the retirements of Tier IIA employees which are less expensive to fund. Jay
 
Old 05-04-2021, 06:32 PM
 
Location: USA
6,586 posts, read 3,543,283 times
Reputation: 3373
Quote:
Originally Posted by JayCT View Post
Also I distinctly remember the 2030 date. It ties to the last revision date of the state’s pension plan. The state revised its pension plan in 1984 and again in 1997. Before 1984 the pension plan, called Tier I, was insanely expensive. There are very few, if any Tier I employees left to retire and fewer each year getting benefits from it. Employees starting from 1984 to 1997 are called Tier II. It’s not nearly as expensive. In 1997 the state implemented the current plan, called Tier IIA, which is much less expensive to fund. The average state employee retires after about 30 years. That means by 2030, the state should be seeing the beginning of the retirements of Tier IIA employees which are less expensive to fund. Jay

Class dismissed!
 
Old 05-05-2021, 05:57 AM
 
Location: Ubique
4,316 posts, read 4,168,786 times
Reputation: 2822
Quote:
Originally Posted by JayCT View Post
Except that the exploding Rainy Day Fund was happening BEFORE the mass exodus of New Yorkers happened.

Also I distinctly remember the 2030 date. It ties to the last revision date of the state’s pension plan. The state revised its pension plan in 1984 and again in 1997. Before 1984 the pension plan, called Tier I, was insanely expensive. There are very few, if any Tier I employees left to retire and fewer each year getting benefits from it. Employees starting from 1984 to 1997 are called Tier II. It’s not nearly as expensive. In 1997 the state implemented the current plan, called Tier IIA, which is much less expensive to fund. The average state employee retires after about 30 years. That means by 2030, the state should be seeing the beginning of the retirements of Tier IIA employees which are less expensive to fund. Jay

Starting in 2030, but retirements are also staggered. Plus people now work longer than they did in 1990s. Plus add that CT public workforce increased its headcount, especially since 2000 - I posted a chart 2-3 years ago somewhere in these 1600 pages that shows growth of state's workforce.

Yes, sometimes in 4th decade the picture is supposed to improve, although not drop like a rock. But I have full confidence in CT to push that back. They don't have it in them.
 
Old 05-05-2021, 10:01 AM
 
2,313 posts, read 2,141,496 times
Reputation: 1313
Quote:
Originally Posted by JayCT View Post
Except that the exploding Rainy Day Fund was happening BEFORE the mass exodus of New Yorkers happened.

Also I distinctly remember the 2030 date. It ties to the last revision date of the state’s pension plan. The state revised its pension plan in 1984 and again in 1997. Before 1984 the pension plan, called Tier I, was insanely expensive. There are very few, if any Tier I employees left to retire and fewer each year getting benefits from it. Employees starting from 1984 to 1997 are called Tier II. It’s not nearly as expensive. In 1997 the state implemented the current plan, called Tier IIA, which is much less expensive to fund. The average state employee retires after about 30 years. That means by 2030, the state should be seeing the beginning of the retirements of Tier IIA employees which are less expensive to fund. Jay
The big other difference with the new agreement is that new hires are under a brand new scheme which the recent and new hires are on different benefit schedules until they hit certain milestones that bump them up. While it existed with the old system it basically only affected the state employees at the very top getting a bump, all others getting a base rate x time worked. This lower the projected liability to the state significantly enough that our credit rating got a bit of a boost.
 
Old 05-05-2021, 10:42 AM
 
Location: Connecticut
34,637 posts, read 56,391,795 times
Reputation: 11150
Quote:
Originally Posted by Henry10 View Post
Starting in 2030, but retirements are also staggered. Plus people now work longer than they did in 1990s. Plus add that CT public workforce increased its headcount, especially since 2000 - I posted a chart 2-3 years ago somewhere in these 1600 pages that shows growth of state's workforce.

Yes, sometimes in 4th decade the picture is supposed to improve, although not drop like a rock. But I have full confidence in CT to push that back. They don't have it in them.
It starts before that since state workers can retire after ten years of service and turning 55 years old.

Also while in general people are retiring later, that is not true of state employees. Unlike most private sector employees who self fund their retirement with a 401k plan and keep working to increase their retirement savings, state employees have no incentive to stay working since they are fully vested after I believe 20 years. Working beyond that gives them nothing more in retirement.

A recent study showed that of the 30,000 Executive Branch employees, 8,000 will be eligible to retire by July 1, 2022. It also showed that anywhere from 63% to 89% of them are planning to retire depending on the jobs they hold. The highest number (89%) are Corrections employees (who can blame them?) while Transportation Engineers were the lowest (63%). Jay

http://ctmirror.org/2021/03/31/consu...mi-approaches/
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