Providence retirees voting on pensions

PROVIDENCE, R.I. (WPRI) - Providence's retired police officers and firefighters start voting Tuesday on whether to accept a proposed settlement to keep the city out of bankruptcy by voluntarily reducing their pension and health benefits, WPRI.com has learned.

City retirees are meeting behind closed doors Tuesday from 10 a.m. to noon at Rhode Island College for an informational briefing on the proposed settlement. Retirees will begin voting in person and by mail on whether to approve the settlement after the briefing, according to documents obtained by WPRI.com.

The retirees' ballots will be counted on Thursday and Superior Court Judge Sarah Taft-Carter will be advised of the outcome on Friday, the documents show. If the retirees reject the deal, the lawsuit they filed challenging the city's attempt to move them to Medicare will move forward.

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A spokesman for Providence Mayor Angel Taveras was not immediately available for comment. He has previously warned the city will be forced into bankruptcy if it can't restructure their benefits, including 5% and 6% compounded annual cost-of-living (COLA) increases for about one in four retired public-safety personnel.

The tentative deal with city workers and retirees announced May 30 by Taveras would head off years of court battles by scaling back pensions in the future, freezing cost-of-living adjustments now and restructuring health benefits - if all sides approve the terms.

Active police officers and firefighters are scheduled to vote on the settlement in July, Taft Manzotti, president of the Providence Fraternal Order of Police, told WPRI.com on Tuesday.

Joseph Penza, the lawyer for the Providence Retired Police and Firefighters Association, warned retirees at the briefing that rejecting the deal could lead them to lose some or all of their pension benefits as happened to retired workers in cash-strapped Central Falls and Prichard, Ala.

Some retirees expressed dismay at the proposed terms. "We've got nothing to look forward to," one retiree told Penza after noting his own advanced age and the fact that pension benefits would not be increased for 10 years. Another said, to applause, that she wanted language included to bar borrowing from the pension fund.

"The experience of politicians in Rhode Island is very sketchy," an older woman told Penza. "They did rob Peter to pay Paul. ... We can't trust them."

If retirees accept the deal, Judge Taft-Carter will then decide whether it's fair. If it passes that hurdle, the settlement could be finalized by October, according to the documents. After granting the retirees an injunction Jan. 30 to block the Medicare changes, she postponed the trial and pushed the sides to reach a negotiated settlement.

The tentative deal would head off not only the Medicare trial but any legal challenges to the city's pension changes. "Keep in mind when voting that this is a 'package deal,' " briefing documents provided to retirees say. "You do not have the opportunity to accept the Medicare offer and reject the COLA offer, or vice versa."

The briefing packet warns retirees beating the city in court may not help them in the end.

"This is one of those very unique situations where court decisions in favor of the retirees could actually be detrimental to them in the long run," the documents say. "Victories in both of these cases could ultimately lead the city to seek protection under Chapter 9 of the United States Bankruptcy Code."

Ted Nesi ( tnesi@wpri.com ) covers politics and the economy for WPRI.com and writes the Nesi's Notes blog. Follow him on Twitter: @tednesi

Tim White ( twhite@wpri.com ) is the Target 12 investigative reporter for WPRI 12 and Fox Providence. Follow him on Twitter: @white_tim