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State Pols Left in the Dark on Pension Reform Bill

Tuesday, November 01, 2011


It’s being billed as the most important piece of legislation they’ll ever vote on, but some state lawmakers say they’re concerned they won’t have all the details they need when they vote on the pension reform plan proposed by Governor Lincoln Chafee and General Treasurer Gina Raimondo.

If the bill passes as is, pension recipients would likely see their cost-of-living adjustments (COLAs) frozen for up to 19 years, the retirement age raised and all state employees would be enrolled in a hybrid plan that would come with a smaller guaranteed benefit. Raimondo says the plan will immediately cut the state’s unfunded liability by $3 billion and that taxpayers will save nearly $3 billion over the next decade.

But with dozens of amendments expected to be introduced, it remains unclear how much different the final piece of legislation will look. That’s what has some members of the General Assembly questioning a decision to rely on the state’s actuary to run numbers on the various scenarios likely to be proposed rather than hiring their own.

Rep. Menard: Treasurer’s Job is Convince Us

State Rep. Rene Menard, a retired firefighter who receives a disability pension, has been one of the most outspoken members of the General Assembly regarding hiring an actuary. Menard contends that lawmakers are being asked to make a $9 billion vote without having all the information they need if changes are made to the bill.

Menard said he trusts Raimondo, but “we’re the legislative branch of government. She’s not.” He said the General Assembly has voted to spend money in other areas “without a blink of the eye” and he can’t understand why they won’t spend money on hiring their own actuary.

“I’ve been saying this is the biggest vote that we’re ever going to see,” Menard said. “I just think we should base our vote on the facts. I would hope that we would retain the services of an actuary, that’s all I’m asking for.”

Menard said it is Raimondo’s job to convince state lawmakers to vote for the bill, which is why he would rather have an independent source to provide the General Assembly with information.

“I’m not calling her a lobbyist, but her position is to convince us that she’s correct and ultimately, that’s what a lobbyist does,” Menard said. “That’s what she’s doing.”

Not Fair to Legislators

Representative Scott Guthrie, another retired firefighter, agreed with Menard. Guthrie said he wants to have the most information available in order to make the vote. He too is calling for an actuary to be hired by the General Assembly.

“Anyone that votes on an important issue such as this must make an informed and educated vote,” Guthrie said. “Without having an actuary on hand to give us the critical data that we need, is not fair to all legislators and also the people they represent.”

Former General Treasurer Candidate and GoLocalProv MINDSETTER™ Tom Sgouros took the argument one step further, calling it “scandalous” that General Assembly leadership would ask members to vote on such technical legislation without providing data and independent actuarial support.

“No legislation can be take-it-or-leave-it,” Sgouros said. "For better and worse, that's the way our system works. As soon as people saw the Raimondo-Chafee plan, it was obvious that some considerations were overlooked. The extra cost of keeping close-to-retirement teachers and state employees was not factored into the cost savings, for example. Assembly members noticed this, but without qualified staff support, they have no way to address it.”

Speaker Fox Encourages Amendments

But House Speaker Gordon Fox says he is committed to a transparent process throughout the pension reform discussion. When the legislation was introduced, Fox encouraged all General Assembly members to attend Finance Committee meetings and voice their opinion on the bill.

In a letter to his members, Fox said now is the time to submit amendment proposals. He has said he has full confidence in the Treasurer’s staff.

“The General Treasurer has the fiduciary responsibility to oversee the state’s retirement funds and the actuary has already looked at a broad range of scenarios at her request,” Fox said in the letter. “It is possible that an amendment you may wish to offer, or one that may be similar, has already been tested by the state’s actuary.”

Fox noted that amendments will be analyzed by the Treasurer and the actuary and said they need to be considered in relation to each other.

“It is also important to remember that the pension reform legislation has many variables that are interconnected,” he said. “As such, they have to be considered in relation to each other. If the actuary and General Treasurer are to provide us with fair, timely and impartial responses to your amendments, it is helpful that they be submitted as soon as possible.”

Common Cause Wants Amendments Made Public 48 Hours in Advance

For Common Cause Executive Director John Marion, the issue isn’t whether the Treasurer is providing accurate information; it’s whether General Assembly members will have the proper time to digest any changes made to the bill.

Marion said Rhode Island has a highly centralized legislature and that it’s difficult from the outside to tell how inclusive leadership is acting on any one issue because the process is so opaque at that level. He said his organization would like to see rank-and-file members should have more access to resources and a greater say in both chambers.

For that reason, Common Cause has been vocal in its calls to make amendments public at least 48 hours prior to any vote so legislators and the public have sufficient time to process any changes.

“Under the current system members are asked to vote on substantive changes not long after first encountering those changes,” Marion said. “That's not fair to the members, nor to the constituents they serve who do not have time to give their representatives input on amendments.”

Rep. Dickinson: I Cannot Vote for this Bill

Timing is also a concern for State Representative Spencer Dickinson, who said rushing the process is unnecessary. Dickinson praised Raimondo and the House Finance committee staff for providing lawmakers with much of the information they need, but said a vote before Thanksgiving might be too soon.

“I think we need several months with this bill and a number of issues have been raised at the hearing and by my constituents,” he said. “If we do this in two weeks, that's like asking me to put a rubber stamp on a bill that's being presented on a take it or leave it basis.”

Dickinson said the process has become too political and with all the money being spent on advertising, it feels like a campaign is taking place. He said he fears rushing a bill without both sides signing off will just result in years of court cases and that nothing will be solved.

“I cannot vote for the bill as is or close to as it is,” Dickinson said. “I'm not saying there isn't a problem, but I just don’t think what we're looking at is going to solve the problem.”


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