HARTFORD, Conn. (AP) — Connecticut will scale back legislation proposing a state-run retirement account for low-wage workers and instead organize a study, House Majority Leader Joe Aresimowicz said Tuesday, a move both unions and businesses see as a victory.
Leaders of the legislature will include about $400,000 in the budget to pay for a study and an appointed board will review tax issues, federal retirement rules and other aspects and report their findings in 2016, he said.
"It's a first step. We're putting money in place," Aresimowicz said.
Lawmakers initially sought to enact legislation establishing a state-run retirement account because low-wage workers do not have access to company retirement plans and cannot afford to establish their own retirement accounts.
Financial services firms and business lobbyists fiercely opposed the measure, saying it competes with Connecticut's financial services and financial planning businesses. The businesses also said a public retirement account is unnecessary and would be another costly mandate.
Aresimowicz said the study is a compromise between backers and opponents.
"Anytime you can strike a balance, it's a good thing," he said.
Matthew Brokman, legislative and political representative for Council 4 of the American Federation of State, County and Municipal Employees, said the study is a win.
"No other state has made this kind of investment in this type of program," he said. "We want to make sure we do this right."
Eric Gjede, assistant counsel at the Connecticut Business and Industry Association, said the business group sees a victory in the decision to scale back the measure to a study. There is no employer mandate and the approach is "more measured," he said.
Still, a study is "not as good as no bill," Gjede said.
Legislation for public pensions has floundered this year in four other states. Measures failed in Indiana, Maine, Washington and West Virginia. In Illinois, the state's proposal barely passed the Senate last month and heads to the House.