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Scott vetoes pension bill, but override likely awaits

Phil Scott at a podium.
ORCA Media
Gov. Phil Scott said the pension bill approved by lawmakers lacks the "structural changes" needed to address a long-term shortfall in the public pension system.

Gov. Phil Scott on Monday vetoed a pension reform bill while acknowledging the legislation will likely become law despite his objections.

The Legislature gave final approval last week to a plan the relies on $200 million in one-time spending to shore up the public pension system for teachers and state employees.

In exchange, the unions that represent those workers have agreed to increases in pension contributions, and modest reductions in benefits for future retirees.

While Scott said he largely supported the framework approved by lawmakers, he said the bill lacked the “structural” changes needed to address a $5.7 billion unfunded liability in the pension system.

And because lawmakers failed to accept his proposed additions — the option of a 401k-style “defined contribution” plan for new state employees, and a “risk-sharing” provision for all public workers — he said he had no choice but to veto the legislation.

“Today’s veto is an affront to teachers, an affront to state employees, and an affront to troopers.”
Don Tinney, Vermont-NEA

“I will acknowledge, this bill takes some positive steps, and the easiest thing for me to do would be to sign it, assure the public we solved the problem and move on,” Scott said in a veto message to lawmakers. “But given the scope of this problem and the risk it poses to the financial health of our state, I cannot bring myself to do that. It would be disingenuous because I know we could have done better.”

In vetoing the pension bill, however, Scott has targeted one of the most popular pieces of legislation to come out of the Statehouse this session.

Democrats, Republicans, Progressives and independents all united behind the proposal, which won unanimous approval in both the House and Senate.

And in a joint statement Monday evening, House Speaker Jill Krowinski and Senate President Pro Tem Becca Balint said they plan to “override the veto expeditiously and leave no doubt as to where we stand in support of the stability of our pensions system and our public employees.”

“We could not be more disappointed that the governor vetoed S.286, the bill to stabilize the public pension system,” Krowinski and Balint said. “We stand with our teachers and public employees to proudly defend the collaborative work we did to take on the looming pension crisis and protect our public pensions.”

Scott said Monday that he’s resigned to the outcome of that override vote.

“It is unfortunate this veto will likely be easily overridden, not for me, but for Vermont taxpayers and State employees who will bear the burden in the future,” he said.

Administration officials made a last-ditch effort to sell lawmakers on Scott’s proposed revisions at a recent meeting of the Legislature’s Joint Pension Oversight Committee.

Committee members said the administration had done no modeling to determine how a defined contribution option or risk-sharing provision would impact the long-term health of the pension fund.

And they said the bill, as passed by the House and Senate, represented a monthslong negotiation between lawmakers and union representatives that could not be undone in the final weeks of the session.

“It just, it doesn’t make sense,” Wilmington Rep. John Gannon said of Scott’s proposals. “It’s like a poison pill.”

State Treasurer Beth Pearce last month warned lawmakers against the adoption of a 401k-style option for new workers, saying research conducted in other states suggested the proposal could add to overall pension costs.

The president of the Vermont-NEA issued a written statement Monday afternoon condemning the governor’s veto as “thoughtless and irresponsible.”

“It is unfortunate that after spending the last two years hailing teachers, state employees and troopers as pandemic heroes, Gov. Phil Scott today rewarded them by vetoing a bill meant to preserve their pensions and give them financial security in retirement,” Don Tinney said. “Today’s veto is an affront to teachers, an affront to state employees and an affront to troopers.”

Have questions, comments or tips? Send us a message or get in touch with reporter Peter Hirschfeld:


The Vermont Statehouse is often called the people’s house. I am your eyes and ears there. I keep a close eye on how legislation could affect your life; I also regularly speak to the people who write that legislation.
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