My Response to Kostes: "Leave the Pension Fund Alone"

After reading Lynda Wellman’s article in the Spectrum, I now understand what mayoral hopeful Bob Kostes meant when he said that he is a “fiscal conservative but a social liberal.” It means that he will watch his own money very carefully but spend yours loosey-goosey.

This one-issue candidate’s comments about the pension fund show that he is uninformed, ill-advised and knows nothing about the history of the Town’s pension investments.

In the mid-1960s, the Town established a Pension Plan with John Hancock with the help of the late Clarence Mitchell, a resident who was a Hancock representative.

In 1994, during the Furhman administration, former Councilman Tom Pilla encouraged the Town Council to form a Pension Committee to examine the Town’s investment strategy and the possible lowering of the actuarial cost to the Town. The motivation was that pension funding had about a 2 mil tax impact. The budgeted actuarial was about $1,500,000 when one mil was equal to about $800,000. This Council Committee consisted of Finance Director Ray Jankowski, Tom Pilla, Guy Peterson, Charles Barlow and others.

During the Peitler administration, Committee Member Bob Sherry brought in a consultant -- an experienced risk manager -- who advised the Committee and thereafter made a presentation to the Council.

The Pension Committee investigated changing to a new fund manager but could only do so if it agreed to pay an exit fee in excess of $500,000. Instead, the Committee opted for a new investment strategy, electing a 60/40 ratio of securities to bonds. Approximately $6,000,000 was placed into fixed assets with a guaranteed and consistent return to secure the existing pensions.

The following year, the actuarial cost dropped from the $1,500,000 to about $800,000 and in the second year it dropped to $600,000, a great savings to the taxpayers. Since then, there has been exponential growth, saving millions of taxpayer-dollars in pension funding.

As Lynda Wellman reported, the Fund has experienced growth of almost $12,000,000 since Mayor Murphy took office, rising from $22,000,000 then to $33,860,000 this past July. And Kostes’criticism doesn’t take into account the pension betterments that have also affected performance.

The best news is that, unlike those of many states and municipalities, New Milford’s Pension Fund is fully funded. Why? The Town invested conservatively, thereby avoiding market volatility. It rejected the push into hedge funds and other non-traditional investments that led to the huge losses that other funds have suffered.

Obviously, this is great news for everyone: our retired municipal workers who are depending on their pensions to pay for their golden years, those who will retire and the taxpayers who fund the system.

Readers should note that New Milford First’s own Bob Gambino didn’t even address the pension plan during his entire tenure as Mayor. Although himself the recipient of a pension, I’m not sure he knew that the Town has a Pension Fund.

Mr. Kostes is free to chase down another Enron for his own investments but it scares me to think that he’d like to do the same for those who now participate in the Town’s pension plan and those who will be. Leave the pension fund alone.

Harvest Moon Over New Milford

Saturday, October 6 is the date. 6 p.m. is the time. Candlewood Valley Country Club is the place. Featuring a dinner buffet, live music, dancing, wine and beer, this Tri-Centennial event is sure to be a winner. Contact Katy Francis at 354-7137 or kafrancis@earthlink.net. Tickets are $30 each.

Honored Glory; A Tribute To New Milford Veterans

This excellent book is available in the Mayor's Office and other locations around Town. Thanks to the efforts of dozens including our own Flagman, Pierre Orenski, the book contains many thoughtful,insightful and stirring recollections and comments.

Mayor Seeks Waste Management Money For Open Space

Monday night's Town Council Agenda contains the following item: "Discussion and possible action on request for $190,000.00 to be appropriated from Fund 97 (Waste Management Account) to secure matching grant for Hunt Hill Farm Trust from the State D.E.P. for the preservation of 40.7 acres that are linked to the 83 acres preserved in 2003." It appears that this money is needed to manage and sustain this property that abuts the Hunt Hill Farm. This is a wise use of the Fund.

Name Location On November Ballot

The absence of exit-polls and other politically important data in New Milford such as sufficient and accurate demographics makes it very hard to know the signficance of the location of a candidate's name on a ballot. But there are a couple of obvious givens. First, the "primacy effect" described by political science experts as the voter's selection of the first name that appears on the ballot. They explain that this happens because a voter is uniformed, ambivalent or even rushed by the people on line behind him or her. Those same voters may attach significance to the appearance of a name above or below another. For example, in a multi-candidate race like Town Council the voter thinks that Mary Republican is running against Joe Democrat because the latter's name happens to appear right above or below the former. These phenomena can and do have a significant impact on races. Many states, such as California and Ohio, have rules that mandate rotation among voting districts or precincts which I think is a great idea. Other states, such as Florida, require that the Governor's party gets first place on the ballot. I wonder if New Milford could lawfully adopt the rotation system.

Marandola Registers As Dem

As reported in today's News-Times, BOE Member Dian Traisci-Marandola is now a Democrat. Well, not exactly. She will be a Democrat 90 days from the September 14 date that she signed up with her new Party. She was rejected by the Republicans because of their concerns about her performance and apparent lack of support for conservative values. I've heard her called a RINO more than once.

Walk-Out At Board of Ed

Not happy that they lost the vote a few weeks ago on plans for replacing retiring Director of Operations Tom Corbett, School Superintendent JeanAnn Paddyfote and BOE Chairman Wendy Faulenbach put the matter back on the Agenda when they could be sure that two cooperators -- Lisa Diamond and Diane Marandola -- were in attendance. After an extended discussion about Robert's Rules and insistence by the Chair to continue the course, the five Members who voted against the plan on the first vote got up and left the Meeting in a brilliant show of solidarity. Kudos to Joe Failla, Julie Turk, Robin Ruggiero, Bill McLachlan and Joey Vita for having the gumption to stand up for what they believe in, against the odds and the "bullying" as one Member calls it. It should also be noted that Chairman Faulenbach announced that she met with the Mayor yesterday to talk about the combining of the BOE and Town Finance Departments. There are also discussions about combining the maintenance departments. Stay tuned.

McLaughlin's Faux Pas

In what may be the faux pas of the election season, disenfranchised Republican Member of the BOF George McLaughlin recommended that any new ambulance barn be named after former Zoning Chair George Doring (RIP). This is totally weird since the Georges had, shall I say mildly, absolutely no love for ane another. While the memory of George Doring should be memorialized in some way, this isn't it. Wouldn't Andy Armstrong be a far better recipient of this recognition for his 30+ years as President of New Milford Community Ambulance?

AFSCME v. Town (More)

Labor law was a second year elective and I have had very little contact with labor issues since. But I have seen the inside of a courtroom once or twice and know that it's to the principals' benefit to try to resolve issues before their lawyers stand up and introduce themselves to the person in the black robe.

Martha, there is absolutely no labor law or practice that prevents the parties from sitting down before the Hearing date to try to resolve your differences. For legal reasons, the request must come from the Union and, given the history, it seems like the best thing to do would be for the meeting to take place without the lawyers. What can either side lose? I'm sure that you have a confidentiality agreement and settlement discussions are never admissable. Even if you just sit with the Mayor and listen to what she has to say. Isn't there a benefit in that?

The entire Town -- including the AFSCME Members -- will benefit from resolving this matter ASAP.

"Dear Mayor Murphy: Without prejudice to any claims, we would like to meet with you to discuss and perhaps resolve pending issues. We would like to do this without the attorneys."

How about it?

AFSCME v.Town;Leaked E-Mail Leads to Larger Story

AFSCME contract negotiations over salary increases and benefits ended months ago without success and the commencement by the Union of a State claim against the Town.

The leaked e-mail was an invitation to Union Members to go to a pizza party on Monday and then attend Monday's Town Council Meeting to urge that their contract be signed. I think this en masse move is ill-advised and would create unwanted ill-will but there are indications that the principals may sit down one more time to try to resolve all issues. Obviously, such resolution would save legal fees and restore the emotional status quo ante.

The parties appear to be mired in a factual dispute caused by a lack of communication among the rank and file. According to former Personnel Director Paula Kelly and confirmed by public documents, the dispute concerns whether or not the negotiations had been concluded. The Union claims that they were, the Town claims that they were not.

The contents of a certified copy of Paula's deposition discloses unequivocally that the negotiations had not been finalized and that the Mayor intended to discuss the Union's demands with the Town Council. It also discloses that the Union's attorney opted not to attend the deposition.

No one wants to deprive the AFSCME Members of a raise. I urge the parties to meet, put all the facts on the table and resolve the outstanding issues.

Problems With Our Ethics Code and Commission

As a Member of a Council Subcommittee, I spent a lot of time drafting changes to the Town's Code of Ethics. The revised Code was adopted and will soon be available in pamphlet form in the Town Clerk's Office. After all that work and more, it is clearer to me now than ever before that not only do we have a system that is dysfunctional but that we need a regional solution to the problem.

A poster wrote that the Town Ethics Commission cannot be effective because it is too inbred. I agree 100% but the problems don't end there.

How in this Town can you find people to serve who aren't in some way connected to an accused? And how can you expect people to serve without training in ethics matters? Even some attorneys on the Commission are confused about ethics issues and some are incapable of following the procedures required by the Code. Some haven't enough education or real-world experience with terms like "probable cause" to know its meaning. Without recourse, both complainants and respondents are left in the cold, rendering the entire process a farce. "Sue me if I didn't follow the proper procedure," could be the Commission's wholly unacceptable position. This is a winning argument in Court since it is hard to prove any impropriety without a record but it is a certain loser in the court of public opinion and perception.

In addition, given the difficulty of finding members who are completely at arms' length with respondents, there must be clear rules about recusal. Should a member recuse himself if he has represented a respondent? If she is a member of his congregation? If he has consulted her professionally or if there is a familial connection or friendship?

A regional ethics board would allow members who have no contact with New Milford to hear complaints. I believe that all the Members of the Subcommittee support the idea.

There must be substantive as well as procedural changes. For example, is it acceptable for a public official to vote on a purchase order that provides money to her employer? Does it matter if she scrubs the floors for that employer or is the head of a department?

The Code's preamble provides, "Having the trust of the public is essential for government to function effectively." Our present system fails to ensure that certain improprieties can be adequately addressed and it doesn't have the trust of this member of the public.

Proposed changes are on the way.

Thanks!

My thanks to you for posting...I hope that things are just warming up!