Towns to sue over retirement cuts

Karen Langley reports in the Concord Monitor on New Hampshire municipalities suing the state for cutting the state subsidy for local retirement benefits.

The state has long provided 35 percent of the payments into the state retirement system for local employees including teachers, firefighters and the police. But the state budget reduced that contribution to 30 percent this fiscal year and to 25 percent for fiscal year 2011. The association estimates the change will cost municipalities and school districts $27 million over the two years.

Groups representing municipalities, school districts and counties are crying foul. The organizations wrote to their members highlighting the budget change and informing them of the pending lawsuit. The suit will argue that the reduction in state payments violates a ban on unfunded mandates in the state constitution. In effect, the ban mandates that the state obtain municipal permission to impose or expand programs that will require local money.

Public employees ready to sue state over pensions

Robert Cook reports in Foster's on the latest lawsuit facing the state budget:

According to the New Hampshire Local Government Center in Concord, the New Hampshire Municipal Association, the New Hampshire Association of Counties and the New Hampshire School Boards Association believe the state is in violation of Part 1, Article 28-a of the State Constitution, which was adopted by the voters in 1984.

Here is the complete text of Article 28-A

Mandated Programs. The state shall not mandate or assign any new, expanded or modified programs or responsibilities to any political subdivision in such a way as to necessitate additional local expenditures by the political subdivision unless such programs or responsibilities are fully funded by the state or unless such programs or responsibilities are approved for funding by a vote of the local legislative body of the political subdivision.

The key questtion is whether the state's decision to pay a smaller share of local pension benefits is really just a mandate for cities and towns to pay a higher share.