CT Paid Leave Authority reports stronger-than-expected fund balance after Q2 actuarial update; transfers, claims discussed

The CT Paid Leave Authority received a quarterly actuarial and financial update at its Feb. 28 meeting, with staff reporting an incurred-basis ending fund balance of about $612.4 million for the six months ending Dec. 31, 2024, and a projected incurred-year-end balance of roughly $642.8 million.

The actuarial presenter, Harindra (Actuary, Spring), told the Authority the six-month net activity was “negative 16.3,” an outcome better than the prior quarter’s projection. Harindra said the improvement was driven primarily by higher investment income, slightly higher contributions and modestly lower incurred claims. “Overall, fund balance continues to remain strong,” Harindra said.

The nut graf: the numbers presented reflect accrual (incurred) accounting. On a cash basis staff projected a lower balance (about $580 million) because some contributions are recognized on an accrual basis in the prior fiscal year. The board and staff focused on differences between projected and actual claims activity, recent contribution trends, and a decision to delay a routine $5 million administrative transfer.

Spring’s summary and staff projections

Spring’s update covered the second quarter of the fiscal year (July–December 2024). Harindra summarized full-year updates that incorporate the revised claims projections presented in December and the six-month actuals. The actuarial presentation showed full-year investment income revised up (from $24.9 million to about $26.0 million) and other expenses reduced because a routine $5 million transfer for administration was not taken in January. Combined, those items increased projected net activity and the projected year‑end incurred fund balance.

Board questions and claims trends

Board members asked whether recent changes reflected underlying claim trends or mostly investment returns. A board member noted modest improvement versus the prior projection and Harindra confirmed the improvement was “largely driven by investment returns.” A staff speaker (claims staff, Erin, referenced in discussion) told the Authority that claim volume remains high and January produced one of the highest months for claim starts, though payments lag those starts and seasonality affects payment timing.

Operating cash and January results

Dave (Staff member) reviewed cash-basis results through January 2025. He reported a net operating result of negative $984,000 for January and explained the Authority did not transfer the usual $5,000,000 from the contribution fund to the operating fund because operating reserves were sufficient and keeping funds in the interest-bearing contribution account produced higher income. “We did not transfer the $5,000,000 from the contribution fund to the operating fund,” Dave said.

Dave gave additional detail: payroll and related expenses for January were about $696,000, outreach $146,000 and contact center expense $132,000. Benefits paid in January totaled about $39.8 million, reflecting five weeks of reimbursements to Aflac; average weekly reimbursements were about $8.0 million for the month. Year-to-date contribution receipts were reported above budget (roughly $472 million year to date), and the most recent quarter’s contributions were about $106.6 million, 6.6% higher than the same quarter a year earlier.

Reserves, bonds and projections

Dave said the short-term investment fund (the Authority’s primary liquid asset) held nearly $609 million at the end of January and operating reserves exceeded $15.7 million. Remaining bond funds for fund-recovery work stood at about $1.665 million. On a projected basis Dave said the Authority expects a small negative net activity on a cash basis at year end driven by the administrative transfer decision, but continued positive operating variances (for example in payroll timing and lower pension overhead) offset much of that pressure.

What the meeting decided and next steps

The board did not take new policy action on benefits or program structure at the meeting; members asked questions and received the actuarial and spending reports. Staff said it will continue to monitor claims, contributions and investment income and present updates next quarter.

Votes at a glance

- Approval of minutes (Jan. 24, 2025): motion moved by Adrienne Cochran, seconded by Holly Williams; outcome: approved (yes: Adrienne Cochran, Andrea Comer, Ellen McKitterick, Holly Williams; no: none; abstain: none). - Motion to adjourn: moved and seconded; outcome: approved (same yes votes).

Ending

Staff will return with the next quarterly actuarial update and an updated projection as more claims and contribution data are finalized.