Projo 7 to 7 News Blog

PROVIDENCE, R.I. -- Despite threats of lawsuits by teachers unions, the House of Representatives has approved a slate of pension cuts aimed at shaving a total of $55 million off the soaring taxpayer cost of providing pensions to more than 26,000 public school teachers and state employees, including new judges.

The final vote for the package was 50-to-24.

For reasons that remain largely unexplained, House Finance Committee Chairman Steven Costantino introduced, and won support, for a last-minute amendment exempting District Court judges from the new curbs the budget seeks to place on the pensions available to judges hired after July 1. When asked the reason, Costantino said: "They are in a different statute.''

At present, Governor Carcieri is evaluating five nominees for chief judge of the District Court, a list that includes four current judges, including Jeanne E. LaFazia, the wife of the chief of staff to the Senate majority leader, and Carcieri's own chief of staff, Brian Stern.

The package does not go as far or save as much money as plans proposed by either Governor Carcieri or a House study-commission.

And none of the changes would apply to anyone already eligible to retire on Sept. 30, a move aimed at averting the kind of mass exodus the state saw in the weeks before the last major retiree benefit change.

But for others, the new rules governing age for retirement, benefit accrual rates and annual cost-of-living increases would take effect Oct. 1.

All but the newest state workers can now retire and start collecting a pension at any age after 28 years work, or at age 60 after as little as 10 years of work, with guaranteed 3-percent compounded annual increases. For newer workers, there is already a minimum retirement age: 59.

Under the new rules, the state would adopt age 62 as its new "target'' age for retirement. In actuality, however, the minimum retirement age would vary for each employee, depending on how long the employee had worked and how close he or she was to qualifying for retirement under the current rules. For example: a state employee who started work at age 25 who could retire today at age 53 and collect an immediate pension, would have to wait until age 53 and three months.

It is an incredibly complicated formula, but simply put: the farther away from retirement the employee is, the higher the age requirement.

The new plan would also key pension calculations -- now based on a three-year salary average -- to a worker's highest five-year salary average.

For new judges, hired after July 1, there would be a cutback in benefits from a maximum of 100 percent of pay for the longest serving judges to either 65 percent or 80 percent of their five-year average, depending on their age and years of work. Correctional officers and a cadre of state nurses who can now retire at age 50, would have to work at least five years longer.

The House went along with Carcieri's plan to reduce the disability benefits paid workers who are not "permanently and totaled disabled'' from the current two-thirds of pay to 50 percent, on the assumption they can find "other jobs.''

In one vote after another, the House rebuffed attempts to stretch the retirement age to 65, or avert any of the pension cutbacks by re-amortizing the state's pension debt, to avoid having to make any cuts now by stretching out the payments.

House leaders objected strenuously to both, with House Majority Leader Gordon Fox delivering an impassioned speech in which he said: "This is when it's going to be step-up time... Now is the time for you to be profiles in courage, not to placate who is going to be supporting me with a campaign check in the next election, not worried about you may offend somebody.''

"So welcome to the club ladies and gentleman. Welcome to the club because these are your times and you are either going to rise to the occasion and make the tough decisions or you are not,'' Fox said. "Send the message that we are not going to put off to our children and our grandchildren the decisions that we need to make now because I would hate to think that some poor state representative 15 years from now now is going to have to deal with the crap we left them.''

When the package first surfaced a week earlier in the House Finance Committee, Marcia Reback, president of the Rhode Island Federation of Teachers and Health Professionals, said the "dramatic reduction in benefits... really is not acceptable.''

"There will be a court challenge and our argument will be that vesting is vesting, that represents a contract... the closer you get to eligibility for retirement, the greater the property right,'' she argued.

Robert Walsh, executive director of the National Education Association of Rhode Island, said his union too "made it very clear to folks from the beginning of these conversations that we would end up in court.''

 Tags  House budget pension cuts Rhode Island House of Represenatives

Comments

reggie said:

Vested is a contract. The whole economy and society is based on contracts. When a contract's integrity is not worth the paper it's printed on ...Lets see what the future holds it wont be positive.

Link | June 24, 2009 8:30 PM
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jan said:

It's the same old story:
"For reasons that remain largely unexplained, House Finance Committee Chairman Steven Costantino introduced, and won support, for a last-minute amendment exempting District Court judges from the new curbs the budget seeks to place on the pensions available to judges hired after July 1. When asked the reason, Costantino said: "They are in a different statute.'' These are the very people who have milked the retirement system with ridiculously high pensions that surpass any pension a teacher could ever get. Politics at its best in RI.

Link | June 24, 2009 11:11 PM
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Dave said:

Two words - NOT ENOUGH

Link | June 25, 2009 7:58 AM
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Tglavin said:

If Leader Fox and the rest of the Apple Dumpling Gang had made the right decisions over the last several years, we wouldn't be in this position! And if he was looking to be true profiles in courage, the House would have adopted the recommendations of their own study committee and Gov. Carcieri. Predictably, they chose a comfortable place right square in the middle. Guess you weren't prepared to take a full step up Mr. Fox.

Link | June 25, 2009 9:34 AM
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Jacob said:

Difficult decisions at this stage of the game.
Horse left the barn years ago. It will be a long, difficult struggle to get out of this hole. But it has to start somewhere. I'm no fan of the GA but maybe they are finally beginning to get the message. We can't afford outrageously generous benefits any longer.

Link | June 25, 2009 11:07 AM
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Shane said:

The GA needs to reavaluate there pay, pensions and base it on performance so they can all be as broke as I am! I'm miffed, i acually vote for these boobs!

Link | June 25, 2009 12:43 PM
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Joseph Bedard said:

Who is leader Fox trying to kid. It's just business as usual. They did not go far enough. He should take his own advice and be profiles in courage. Like the old saying goes, don't do as I do, do as I say. As long as our illustrious leaders in the general assembly remain in power nothing will change. One of these days, someone will do what is right for the constituents and the State.

Link | June 25, 2009 2:23 PM
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bob said:

for those teachers who have retired years ago and depend on that retirement to live, i can't see any reduction that would be acceptable. you now want to put us on welfare. what a joke

Link | June 26, 2009 6:39 AM
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