CT Paid Leave fund posts $20 million FY2026 loss; three-year projection shows declining balance

Holly Williams, Chair of the Connecticut Paid Leave Finance & Audit Committee, heard the authority's annual actuarial review on July 24, 2026, during which presenter Harindra outlined fiscal-year 2026 results and a three-year projection.

Harindra said, “Overall, the actual net activity was minus 20. So in other words, income was $20,000,000 less than expenses,” and reported an incurred-basis ending net fund balance of $618,900,000 as of June 30, 2026. He told the committee the fund position remains sufficient to pay claims but that one of three target metrics — the ratio of adverse losses over one year net to the net fund balance — exceeded the program's 0.5:1 threshold (reported at about 0.581:1).

The actuarial projection presented by Harindra shows a projected FY2027 net activity of negative $70,200,000, driven by projected contributions of $521.7 million, investment income of $18.8 million and incurred claims of $568.6 million; that scenario reduces the projected net fund balance to $548.7 million in FY2027 with further declines through FY2029 absent offsetting changes.

Harindra explained the principal drivers are higher claim incidence and benefit increases tied to wage growth assumptions; he said the analysis assumes 4% annual wage growth and projected investment returns of roughly 3.61% in FY2027, 3.24% in FY2028 and about 3.13% thereafter. He also noted that projections incorporate historical Connecticut program experience and comparisons with other states.

The committee did not take formal action on the projections at the meeting. The board is scheduled to consider contribution-rate decisions later this year as required by statute; staff told members the board can set but not increase the statutory cap without legislative action.