Republican lawmakers held a press conference today demanding that Gov. Ned Lamont provide greater transparency regarding state officials’ recent exploration of investing pension funds into the Connecticut Sun, the state’s WNBA team. They posed these discussions as being indicative of a larger issue: a lack of meaningful oversight of the State’s Treasurer’s Office, who is the sole asset manager of state employee pension funds.
“Connecticut is [the only] one of the 50 states that now has a sole fiduciary in its elected State Treasurer, responsible himself or herself for the management of tens of billions of dollars of funds, without legal oversight that is adequate for the protection of those people, for our state, its taxpayers and its state employees,” said Sen. Ryan Fazio (R-Greenwich), who is a Ranking Member of the State’s Finance, Revenue & Bonding Committee. “Regardless of what happens with the Sun investment, if we had this system with broad responsibility, with a board of directors who were professionals and had legal responsibility and input for these decisions, then we could feel more secure in what decision ultimately is made.”
The Connecticut Sun, the state’s only WNBA team, was founded in 1999 and purchased by the Mohegan Tribal Nation for $10 million in 2003. With the recent popularity of women’s basketball, the team’s valuation has spiked significantly, with the Nation reportedly fielding offers north of $300 million for the team’s purchase. While rumors of the Nation’s sale of the team have swirled since last fall, talks became serious this May, when the team officially announced its intent to sell. Lamont immediately announced his wish for the team to remain in state, and his own intent to speak with the Nation to see what could be done.
“They mean a lot to the state,” Lamont said, per NBC Connecticut. “I’ll be speaking with the Mohegan Sun and see what the situation is. I don’t want to put the taxpayers’ money at risk, but I also know how important the Connecticut Sun is, so I will just hear what they have to say.”
On Sep. 10, Lamont and State Treasurer Erick Russell told reporters for the first time they were considering investing pension money into the team, with the backing of private junior investors. They said the move would not only serve to keep a professional sports franchise in Connecticut, but could provide a safe return on investment as well. Since that announcement, Republican lawmakers have publicly shared their skepticism surrounding Lamont’s true intent behind these talks, decried what they believe is a lack of transparency with state lawmakers surrounding the nature and content of these discussions, and have said that the decision should not be made unilaterally.
“Over the course of the last week, we’ve seen Governor Lamont take a sort of rapid, haphazard approach in an attempt to keep the Connecticut Sun in the state of Connecticut,” said House Minority Leader Vincent Candelora (R-North Branford). “We are concerned that there is a lack of transparency, a lack of detailed proposals.”
Candelora cited the state’s prior dealings with companies such as Sikorsky, Jackson Lab, and Pratt & Whitney, as examples of public-private deals done in the open. He said that any dealings the Governor’s or Treasurer’s Office may have had with the WNBA or Mohegan Sun to date have been anything but transparent. Both the most recent agreement made between the state and Sikorsky, finalized in 2022, and the agreement it made with Pratt & Whitney back in 2014, were tax credit deals requiring the approval of state legislators. Candelora called the potential investment of pension funds into a privately-owned sports team an “unprecedented move,” and argued it should not be made without the consultation of lawmakers.
“We’ve had no conversation; we’ve only read about these proposals through press conferences, through brief media gaggles, and now through reporting we are starting to see what the framework is for the state of Connecticut,” said Candelora. “We think it deserves answers to our questions, and so we are calling on the Governor to be transparent with what this proposal looks like, what has actually been submitted to the WNBA.”
Senate Minority Leader Stephen Harding (R-Brookfield) echoed those sentiments and said that he and other Republicans believe in “common sense,” in that any investment of pension funds should be done for the sole purpose of increasing returns on investment. Harding vocalized his skepticism regarding whether the move is being made solely out of that interest or whether it is being done in the interest of furthering the state’s economic development. He and other speakers argued that if it’s the former, then state lawmakers should be provided with the numbers to back up the move’s purportedly positive returns, and if it’s the latter, then it is an investment that should be made either with money from the State’s General Fund or bonded for with the approval of the State’s Finance, Revenue and Bonding Committee.
“The governor is talking out two sides of his mouth here, because in one sense, he initially comes out and says, ‘Well, we have to find a way to keep the team here,'” said Harding. “Then all of a sudden, he determines that the pension fund is the vehicle by which he’s going to do that. Now all of a sudden, it’s because it’s a great investment. So, which is it governor? Is it a great investment, or are we using this essentially for corporate welfare?”
Lawmakers said they would be potentially open to a deal, but only if the Governor cued them in first and demonstrated that it would ensure positive returns. Fazio said that the issue went beyond just positive or negative ROIs, but was “an issue of principle,” and said that allowing pension funds to be used for the benefit of economic development, without any oversight of lawmakers or a body beyond the Treasurer themselves, could set a negative precedent.
Fazio, as well as Rep. Joe Polletta (R-Watertown), another Co-Ranking Member of the Finance, Revenue and Bonding Committee, both argued that these conversations further the need for a serious reform of the State’s Treasurer’s Office. Fazio said that he first proposed such reforms three years ago, after the Yale School of Management released a report in 2022, finding Connecticut to have the second worst return rate for its pension investment fund, trailing only North Carolina. Fazio said that one thing Connecticut had in common with North Carolina at that time was that they were the only two states to place the responsibility of pension fund investment solely into the hands of their State Treasurers. Fazio said that North Carolina changed this about a year ago, when it added measures to further oversee its treasurer.
Fazio said the most recent proposal was made last year via SB 1557, but that it was rejected along party lines, the same as his previous attempts to introduce such legislation in prior sessions. He noted that while the State Treasurer currently has an Investment Advisory Council, they are able to bypass their recommendations without recourse, essentially making the council ineffective. He said the state has seen examples of past Treasurers overriding the Council’s recommendations without consequence, such as in the case of ex-Treasurer Denise Napier.
“She has overridden them in the past, and you know, I think this current treasurer is a better treasure than her, for instance,” said Fazio. “But we’re not just making policy decisions for the current treasurer; we’re making policy decisions for the next ten treasurers, and for the retirements of tens of thousands of Connecticut state employees.”
Ultimately, Fazio said that the proposal was “good government,” that would benefit not only state employees and taxpayers, but future treasurers as well.
“Our proposal would protect taxpayers, would protect state employees, would broaden out responsibility and power for the management of 10s of billions of dollars, rather than investing it in a single individual,” said Fazio. “In the long run, it would be to the benefit of the current and future state treasurers as well. I wouldn’t want to be the sole person legally responsible for tens of billions of dollars. No person should and no private or public organization operates in this way.”
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This article highlights crucial transparency issues regarding pension fund investments in the Connecticut Sun. The lack of legislative oversight and clarity on returns is concerning, raising valid questions about accountability and potential misuse of public funds for corporate welfare.