State government finances have been shaped for decades by a legacy of massive public-sector pension debt that dates back to the late 1930s, a challenge expected to continue well into the 2040s.

And with incumbent state Treasurer Shawn Wooden not seeking reelection, three Democrats will square off in a primary this week, hoping ultimately to oversee the nearly $45 billion in pension and trust fund assets that Connecticut holds.

And while Erick Russell, Dita Bhargava and Karen DuBois-Walton bring different backgrounds to the primary, all three are acutely aware of the importance of the treasurer’s office and pledge to bring a strong voice to the job. The winner of Tuesday’s Democratic primary will face Rep. Harry Arora, R-Greenwich, in the general election in November.

“I think we need a state treasurer who comes in on day one with public experience in delivering for hard-working families,” said DuBois-Walton, president of the New Haven Housing Authority.

DuBois-Walton, 54, who’s held administrative posts at the authority since 2008 preceded by six years as a chief of administrative services and chief of staff under then-New Haven Mayor John DeStefano, has seen firsthand the power of public investments.

Whether it involves saving for college, securing affordable housing or guarding against long-term health-care costs, helping families become financially secure is a long-range investment in Connecticut’s economy.

“We need to be a government that helps people prepare for the real fiscal crunch,” said Dubois-Walton, who also chairs the state Board of Education.

Many Connecticut’s suburbs have long resisted efforts to allow more affordable housing development, and DuBois-Walton said the state no longer can rely on incentives to reverse decades of exclusionary zoning practices.

“I think we’ve seen the limits of what the current law will do,” she said, adding that the current supply of affordable housing “falls woefully short of meeting the need.”

Bhargava of Greenwich, a quantitative hedge fund manager who lost the 2018 Democratic primary for treasurer to Wooden, also said the treasurer must use the power of state investments to promote economic opportunity and to encourage responsible corporate behavior.

Bhargava has repeatedly referenced Purdue Pharma, the Stamford-based manufacturer of OxyContin, which filed for bankruptcy three years ago and whose questionable marketing practices sparked a national response to the opioid crisis.

Wooden’s office issued a statement recently noting that Connecticut’s pension funds aren’t invested in the privately held Purdue Pharma. “There could always be the next Purdue Pharma,” Bhargava said, adding that the firm, “guided by short-term greed,” typifies the company treasurers must be vigilant against.

Bhargava also made headlines this summer battling Hulu, convincing the streaming service to air her ad responding to the Supreme Court’s decision to overturn Roe v. Wade. Bhargava said she would press companies seeking Connecticut pension investments to provide health insurance that covers abortion services.

An incredibly robust stock market helped Connecticut amass a $3.3 billion rainy day fund over the past four years and dedicate another $5.8 billion in reserves since 2020 to pay down pension debt.

But Bhargava, 50, who has a degree in engineering and doesn’t shrink from scary numbers, notes that — as impressive as this savings has been — Connecticut still has a long way to go to overcome more than $90 billion in unfunded retirement benefit obligations and bonded debt.

She pledged to take a hard look at a state panel recommendation to transfer lottery proceeds and other state assets to further bolster pension assets.

“Our fiscal situation has been 70 years in the making,” said Bhargava, who opposes whittling down benefits promised to state employees and municipal teachers. “It’s not right to undo promises the state made because leaders were careless.”

Russell, a partner with Pullman and Comley who specializes in public and private financing, says Connecticut — and state government in particular — has reached an inflection point.

After a decade of the 2010s marked by a sluggish economy and frequent state budget deficits, Connecticut has been able to amass huge, short-term budget reserves and avoid major tax hikes for the past seven years.

But with another potential economic downturn looming, the challenge is to continue to grow pension assets and invest even more in opportunities for working families — all while keeping taxes relatively stable.

“My overarching goal here is to make sure we are protecting the fiscal health of our state long-term but making sure we’re doing so in a way that’s keeping working families in mind,” said Russell, 33, who lives in New Haven.

The first person in his family to graduate from college or from law school, Russell said he learned the sacrifice and effort many Connecticut families face working as a child with his parents in their convenience store on Congress Avenue.

“I watched my parents really sacrifice a lot for me to have opportunities they never had themselves,” he said.

Russell and Bhargava both expressed concerns over the state’s current practice of using the proceeds from bond premiums to help cover annual debt service costs — effectively borrowing to pay off borrowing.

The state projects to use $151 million in borrowed funds this fiscal year to retire debt. And while the practice is scheduled to end next July, efforts to kick this fiscal habit have been deferred in the past.

Connecticut has made “huge strides” in recent years stabilizing its finances and debt, Russell added. “I think that we need to continue on this path. … This is what is going to allow us to continue to invest in our communities.”

Both Russell and Bhargava also are former vice-chairs of the Connecticut Democratic Party.

Russell, who captured the Democratic state convention endorsement for treasurer in May, stands to make history as the first Black LGBTQ candidate elected to statewide office in national history, said Albert Fujii, spokesman for the LGBTQ Institute.

A nonprofit launched in 1991, the institute maintains the only national database of LGBTQ candidates.

Keith M. Phaneuf is a reporter for The Connecticut Mirror (www.ctmirror.org). Copyright 2022 © The Connecticut Mirror.

kphaneuf@ctmirror.org