Gov. 'disappointed' in new pension bill

PROVIDENCE, R.I. (WPRI) - Gov. Lincoln Chafee says he is “deeply disappointed” in lawmakers’ revised version of the pension bill he co-authored because it does not address the 36 locally run pension plans.

In a statement, Chafee described the reworked legislation as “a substantial – but incomplete – step toward comprehensive pension reform.” But he did not threaten to veto the new version of the bill, and praised lawmakers and Treasurer Gina Raimondo for tackling “this complicated and difficult issue.”

“It is unfair and defies logic to continue to pay unaffordable COLAs to municipal retirees – many of whose systems are in far worse condition than the state – while asking retired state employees, teachers, and some municipal employees to forfeit their own COLAs,” the governor said.

General Treasurer Gina Raimondo – who pushed pension reform to the top of the state’s agenda – issued a statement backing the bill, but warned against further changes.

“At this point, I urge caution that further amendments, which could compromise the principles of affordability, sustainability, and security must be avoided,” Raimondo said.

The House and Senate finance committees are expected to vote on the legislation tomorrow afternoon. It will then head to the General Assembly for consideration by both chambers.

• PDFs: House version of bill / Senate version of bill

The joint finance committee began a hearing on the reworked legislation shortly before 6 p.m. Wednesday, nearly three hours after it had been scheduled to start.

Some of the major highlights to the reworked legislation include:

• cost-of-living adjustments (COLAs) may be awarded every 5 years during freeze
• all employees except public-safety workers go into the hybrid plan
• active workers get a retirement age between 59 and 67 based on how close they are now
• COLAs will only be awarded on first $25,000 of a pension, down from $35,000
• judges included in COLA suspension
• part-timers will be able to get a pension; but based on 10 highest years to avoid “spiking”
• revised bill costs $27M more, but the estimate may get lower

The new amended legislation marked a loss for Chafee, Providence Mayor Angel Taveras and others who pushed to allow the locally run plans to suspend COLAs. Raimondo and Senate President M. Teresa Paiva Weed opposed involving the local plans in the reform bill.

The revised bill creates a commission to study the problem. Chafee said he will introduce a bill on the first day of the General Assembly’s session in January to do more to address the 36 locally run plans, 24 of which are classified as at risk of running out of money by the auditor general.

Target 12 Investigator Tim White contributed to this report.

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