TO:                   THE PENSION BENEFITS TASK FORCE
FROM:             PATRICIA MCDONALD – PRESIDENT, CAMPAIGN FOR VERMONT PROSPERITY
DATE:              DECEMBER 6, 2021
RE:                   FOLLOW UP FROM TESTIMONY ON DECEMBER 1, 2021

Dear Members of Pension Benefits Task Force:

First, I want to thank you for giving Ben Kinsley and me the opportunity to present the findings of our report entitled “The Public Sector Reality.” The purpose of this report was to examine the overall competitiveness of our public and private employee wages. We believe this question does have an impact on how we should address the pension crisis because it gets at what level of benefits we should be offering to new hires. We cannot meaningfully change the promises we have already made to fully vested employees (nor should we), but we can make adjustments for new employees as a large portion of our workforce potentially turns over within the next several years.

It turns out that some government officials have known for a while that state government salaries are competitive. This letter (dated October 29, 2009) from Jeff Carr to Governor James Douglas about a review of a VSEA memo to Donna Sweaney, Chair of Government Accountability Committee. Carr’s letter, over a decade old now, points to many of the same factors we found in our recent report around compensation levels and the growth rate of state employee compensation compared to the private sector.

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On November 10^th Campaign for Vermont (CFV) held a press conference to review the details of its report entitled The Public Sector Reality. For the record, I am the President of the Board of Directors of CFV.  Over the past months of pension discussions at the Legislature we heard claims about the state’s non-competitive wages and we decided to verify those statements. We set out expecting to find that pension benefits were an unquestionable asset to recruiting and retaining our public sector workforce. What we found surprised us.