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January finance update: contributions and benefits drive near-term variance; staff projects fund near $570 million at year end
Summary
Finance staff reported a January operating positive variance driven by timing and stronger-than-expected fourth-quarter contributions, average weekly benefit spending near $9.2 million, and a projection that the fund will end the fiscal year north of $570 million despite year-to-date negative activity including transfers.
Finance staff presented January 2026 operating and contribution results and updated year-end projections for the CT Paid Leave program.
The presenter said operating results produced a positive variance of roughly $329,000 for the month, driven in part by timing (a software license payment shifted to a later month). January contribution activity was about $61.2 million; the presenter said the authority received roughly $111.2 million in fourth-quarter contributions, which helped produce a month-over-month positive variance. Average weekly benefit payments were reported near $9.2 million for January (five-week measurement).
Investment income for the month trailed budget expectations because short-term investment returns averaged about 3.73% versus a 4.1% budget assumption. Year-to-date activity including a redesignation transfer was roughly negative $9.7 million, and staff reported a year-to-date contributions total near $488.1 million. Finance staff revised the fiscal-year projection, expecting roughly a negative $12.7 million of net activity for the year and projecting the fund to be north of $570 million by June 30, 2026.
Board members asked for confirmation of the prior fiscal-year ending balance (about $582 million) and that the projection would finish the year close to $570 million; staff confirmed. The presenter said most drivers of the variance are higher benefit paid activity and seasonality in contributions; no new policy action was taken during the meeting.
