Category Archives: Pensions/retirement

The Reign of the Invisible Man

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Harlan Sylvester, large and in charge (Not Exactly As Illustrated)

The House Democrats’ ill-considered pension reform plan was the icing on the cake, the topper in a series of events that expose the fundamentally centrist nature of the party and its officeholders.

And this I trace to the all-encompassing influence of one Harlan Sylvester.

For those just tuning in, Sylvester is a longtime money manager who shuns the limelight — but for decades, he has been the kingmaker of Vermont politics. You don’t get to the top of the heap without his blessing. And it sure seems like the modern Democratic Party has been fashioned according to his fiscally conservative taste.

There have been occasional press profiles about him, and they all describe him the same way. Peter Freyne, 2000: “Mr. Sylvester has had the cocked ear of Vermont governors going all the way back to Tom Salmon in the 1970s.” Freyne quoted then-UVM political science professor Garrison Nelson thusly: “Harlan loves conservative Democrats. He wants to erase the gap between the Democratic Party and the Republican Party.”

Rutland Herald, 2002: “it was Harlan Sylvester’’s considerable influence and strategic skills that helped put [Republican Jim Douglas,] the apparent underdog candidate, in office.”

In 2010, Freyne’s successor Shay Totten described Sylvester as “The most powerful man in Vermont politics.” Totten also quoted Prof. Nelson: “He’s got access to people with real money, and those people with real money will invest in politicians who will protect their interests.”

So that’s Mr. Sylvester, who is in his late 80s but his power has not been visibly diminished. From what I’ve heard, he remains the power behind the throne.

And now let’s look at what the Democratic Party has become.

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Well, it’s not a flaming bag of poo

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With no advance warning, the House Government Operations Committee on Wednesday rolled out a reform plan for Vermont’s underfunded public sector pensions. And from the unions’ point of view, it could hardly be worse.

Before I get to the details, I’ll define “no advance warning.” On Wednesday morning, the committee first heard a proposal to restructure the pensions under a single Vermont Retirement Commission. That plan was posted to the committee’s website very shortly before the hearing began. Two lawmakers broadly hinted that they were reading it for the first time, with no chance to digest or formulate questions.

Ditto the pension reform plan. It was posted to the committee’s “Documents & Handouts” webpage only two minutes before its hearing was to begin.

For an issue as complicated as pension reform, this is unconscionable.

Well, it’d be fine if we were at the beginning of a normal legislative timeline with plenty of hearings and back-and-forth and rewrites of the legislation. But as far as I can see, we’re not going to get any of that. As I said in my previous post, legislative leaders are hellbent on enacting pension reform this year. If they’re going to hew to that ambitious timeline, Gov Ops would have to vote out an actual bill within days.

There were a few signs of exactly how rushed these proposals were. Rep. Bob Hooper asked if a cost analysis had been done on the new Retirement Commission. The answer was “No.” Later he noted that the reduction in benefits seemed out of proportion with projected savings; apparently a full fiscal analysis has yet to be done.

Whenever they want to slow-play an issue, legislative leaders usually claim that there’s not enough time to give the issue the scrutiny it deserves. If this pension plan gets fast-tracked, I don’t ever want to hear that excuse again.

After the jump: The grim details.

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Now, I’m not saying the House Democrats are ready to deliver a flaming bag of poo regarding public sector pensions. It’s just that all the signs point in that direction.The teachers’ and state employees’ unions should take care with any packages they find on the doorstep.

Because, apparently, the behind-closed-doors work has just about wrapped up. And suddenly, the House Government Operations Committee’s schedule is packed with pension-related hearings — leading up to the oft-promised public hearing on the as-yet-unreleased plan at the Traditional Newsdump Hour of Friday afternoon.

You know how rare it is for the Legislature to do anything substantive after 4:00 pm on a Friday? The only time it usually happens is during the last-ditch rush to adjournment.

And now, with a mere three days’ notice, the House Dems have scheduled a public hearing from 4:00 to 6:00 Friday. On a proposal that, as I might have already noted, hasn’t been made public as of this writing.

Friday’s dog-and-pony-show hearing will feature a parade of speakers who will each get three minutes to say their piece. Up to, presumably, the 120-minute time limit. That means, let me see, a total of 40 speaking slots. Forty! On an issue that touches the retirement security of thousands of Vermonters! You can register here; I suggest you do it fast.

It’s possible that the Dems have crafted a pension reform plan acceptable to all parties. But every sign points in the opposite direction. Secrecy? Check. Sudden effusion of hearings? Check. Little notice before a public hearing? Check. Public hearing scheduled for the Friday afternoon dead zone?

Check and double-check.

Did I mention there’s no actual bill yet? At least not one that’s publicly available.

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Gloves Off, Let’s Go

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Says here Vermont’s public sector unions are feeling anxious about closed-door talks on how to fix their pension plans. Can’t say I blame them. The 2021 session is more than halfway done, Speaker Jill Krowinski is determined to get something done by then, and there’s been not a peep about what a fix might look like. And since Treasurer Beth Pearce has outlined exactly how drastically pensions might change, the teachers’ and state employees’ union have every right to be concerned.

And this is the time to show their concern through hardball, sharp-elbow politics. Give ’em hell. Threaten a cutoff of union support for any lawmaker who supports a major cut in pension benefits or a major increase in employee pay-in. Get in there and throw some elbows.

Mind you, I’m not talking right and wrong here. I’m talking the timely application of leverage.

The VSEA and VT-NEA are two of the most powerful forces in the Vermont Democratic Party. They provide financial support, volunteers, and lots of voters. They have earned a great deal of influence in party circles. That influence should be brought to bear, right now if not sooner.

You’d think this wouldn’t be necessary. You’d think the Legislature’s Demo/Prog majority would be working with the unions to resolve this crisis. But union lobbyists say otherwise.

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An Unsettling Incident in Senate Finance

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Senate Finance Committee chair Ann Cummings is a mixed bag. She’s not the most imaginative or energetic policymaker; she barely bothers to campaign and waltzes to re-election every two years. She’s one of the many veteran senators with a very well-developed sense of entitlement.

On the other hand, she knows her stuff. That’s nothing to sneeze at when it comes to issues as complex as taxes and state revenue.

But that didn’t seem to be the case during a Thursday committee hearing. Quite the opposite; she was shockingly uninformed on one of the biggest financial issues facing state government in 2021. I couldn’t believe it at first, but then she did it again.

The subject was S.59, a bill introduced by Sen. Cheryl Hooker and four other senators. The bill is an attempt to address the glaring shortfalls in the state teachers’ and public employees’ pension funds — an issue brought to the forefront by Treasurer Beth Pearce this year. After having defended the funds throughout her tenure, she started ringing the alarm bell on funding shortfalls and advocating substantial changes.

The Dem-dominated Legislature now faces a choice between finding a big new pot of money for the funds, and imposing pain on two of the party’s most important constituencies. S.59 opts for the former; it would add a 3% income tax surcharge on Vermonters with incomes of $500,000 or more, and devote the revenue to filling the hole in the pension funds. Sen. Ruth Hardy, a member of Senate Finance and an S.59 co-sponsor, presented an initial look at the bill. It didn’t go well.

Pearce’s pivot has been the unexpected policy story of 2021 (so far). She’s been making the rounds of relevant legislative committees, laying out the problems and presenting lawmakers with the unpleasant policy choice described in the previous paragraph. On February 4, she offered her pension testimony to Senate Finance.

One week later, Cummings made it clear she didn’t have a clue about Pearce’s position or the status of the pension plans.

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