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Riley: Time to Review Why 16 RI Municipal Pension Funds Shouldn’t Be Shut Down

Tuesday, February 07, 2017

 

Approximately two years ago, the Local Pension and OPEB Study Commission reported on local pension plans which are critically under-funded (funded ratio of less than 60%) as well as issues pertaining to other post-employment benefits.

Formed in 2011 as part of Pension Reform, this commission focused on data gathering and induced compliance. In January 2015, the commission produced a report to the Governor and General Assembly that contained a series of recommendations.

My analysis show that few, if any of the cities and towns labeled as “crisis” have followed through on their commitments to address the severe underfunding issues. Some have actually gone backwards. Most of the projected unfunded liabilities reductions have not been met and some appear as hopeless in terms of any possible reason these towns should be managing a defined pension plan. It is time we removed from these towns the ability to manage their own plans.

The commission met 39 times from 2011 through 2014 and came up with a series of recommendations. Some are quite helpful but given the lack of follow through it is clear that the Governor, after avoiding the Municipal issue for years, needs to make responsible and immediate decisions to deal with "zombie" Rhode Island towns. 

The report concluded that a “one size fits all” approach to boosting sustainability of these funds was not appropriate. I vehemently disagree. The behavior of these critical status towns indicates the towns and their officials don’t belong managing a pension plan and should be shut down en masse. They should be expected to follow strict guidelines of funding and accounting.

 Recommendations Considered:

"The Commission has considered eleven recommendations to improve local pension and OPEB plan health and help municipalities meet the challenge that will ensure sustainable benefits that are also affordable and competitive. We’ve taken great effort to incorporate dissenting viewpoints in this document so that legislators can fully and objectively assess alternatives."

  • Establish an oversight board 
  • Expand legislation requiring fiscal impact statements
  • Require an annual funding notice 
  • Expand proposed budget language in municipal disclosure process
  • Continue funding municipal incentive aid program
  • Study feasibility of administering a voluntary program to invest plan assets
  • Consider expanding criteria for oversight under the fiscal stability act 
  • Develop a voluntary MERS pathway 
  • Continue to monitor OPEB plans 
  • Consider funding improvement plans for OPEB 
  • Consider establishing a state-wide OPEB trust

The report can be found here. In the coming weeks, we will review the proposals of the 16 to 18 towns made to the commission in 2013 and their unfunded liability projections for 2016. Let’s just say it is not pretty.

Michael G. Riley is vice chair at Rhode Island Center for Freedom and Prosperity and is managing member and founder of Coastal Management Group, LLC. Riley has 35 years of experience in the financial industry, having managed divisions of PaineWebber, LETCO, and TD Securities (TD Bank). He has been quoted in Barron’s, Wall Street Transcript, NY Post, and various other print media and also appeared on NBC News, Yahoo TV, and CNBC.

 

 

Related Slideshow: Top Providence Pensions

Prev Next

#49

Name- Daniel Guertin

Annual Earning- $95,050.92

Postition- Police-5

City- Providence   

State- RI

Retirement Type- Accidental Disability

Retirement Date- December 19,1991

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#48

Name- Carmine Vallante

Annual Earning- $95,140.20

Postition- Fire-4

City- Johnston

State- RI

Retirement Type- Accidental Disability

Retirement Date- December 19,1991

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#47

Name- Alfred Millard

Annual Earning- $95,368.32

Postition- Fire-4

City- Warwick

State- RI

Retirement Type- Accidental Disability

Retirement Date- March 24, 1994

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#46

Name- James Rattigan

Annual Earning- $95,983.44

Postition- Fire-4

City- North Providence   

State- RI

Retirement Type- Service

Retirement Date- June 30, 2003

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#45

Name- Frank Deangelis

Annual Earning- $95,986.80

Postition- Fire-4

City- North Providence   

State- RI

Retirement Type- Accidental Disability

Retirement Date- December 19, 1991

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#44

Name- Stephen Lowe

Annual Earning- $96,156.36

Postition- Fire-4

City- Bristol   

State- RI

Retirement Type- Accidental Disability

Retirement Date- December 17, 1992

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#43

Name- Mary Gonsalves

Annual Earning- $97,463.04

Postition- Police-5

City- Warwick

State- RI

Retirement Type- Beneficiary

Retirement Date- December 1, 1993

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#42

Name- William O'Neill

Annual Earning- $98,160.96

Postition- Fire-4

City- Cumberland   

State- RI

Retirement Type- Accidental Disability

Retirement Date- August 22, 1990

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#41

Name- Paul Healy

Annual Earning- $98,183.28

Postition- Fire-4

City- Cranston  

State- RI

Retirement Type- Service

Retirement Date- October 20, 1993

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#40

Name- James Molloy

Annual Earning- $98,711.16

Postition- Fire-4

City- Providence   

State- RI

Retirement Type- Accidental Disability

Retirement Date- December 18, 1987

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#39

Name- Livia Miller

Annual Earning- $99,193.80

Postition- Fire-4

City- Warwick 

State- RI

Retirement Type- Beneficiary

Retirement Date- May 1, 1997

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#38

Name- Joseph Battista

Annual Earning- $99,271.08

Postition- Fire-4

City- Johnston

State- RI

Retirement Type- Accidental Disability

Retirement Date- April 29, 2004

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#37

Name- Robert Kerfoot

Annual Earning- $100,140.36

Postition- Fire-4

City- Cranston

State- RI

Retirement Type- Accidental Disability

Retirement Date- March 24, 1994

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#36

Name- Ralph Ricci

Annual Earning- $100,357.44

Postition- Fire-4

City- Providence

State- RI

Retirement Type- Accidental Disability

Retirement Date- April 28, 1994

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#35

Name- Henry Latek

Annual Earning- $100,502.52

Postition- Fire-4

City- Providence

State- RI

Retirement Type- Service

Retirement Date- June 30, 1995

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#34

Name- Joseph Bradley

Annual Earning- $100,898.52

Postition- Fire-4

City- Whitefield

State- NH

Retirement Type- Accidental Disability

Retirement Date- November 20, 1991

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#33

Name- Ronald Johnson

Annual Earning- $102,098.64

Postition- Fire-4

City- North Scituate

State- RI

Retirement Type- Accidental Disability

Retirement Date- May 1, 2003

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#32

Name- Gloria Pisaturo

Annual Earning- $103,385.76

Postition- Police-5

City- Warwick

State- RI

Retirement Type- Beneficiary

Retirement Date- December 1, 2002

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#31

Name- Edmond Malloy

Annual Earning- $103,575.72

Postition- Police-5

City- Chepachet

State- RI

Retirement Type- Accidental Disability

Retirement Date- September 5, 1990

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#30

Name- John Reposa

Annual Earning- $104,665.44

Postition- Fire-4

City- Jamestown

State- RI

Retirement Type- Accidental Disability

Retirement Date- June 21, 1995

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#29

Name- Pasquale Rocchio

Annual Earning- $105,238.32

Postition- Police-5

City- North Providence

State- RI

Retirement Type- Service

Retirement Date- August 22, 1989

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#28

Name- David Deignan

Annual Earning- $105,609.36

Postition- Police-5

City- Providence

State- RI

Retirement Type- Accidental Disability

Retirement Date- December 19, 1991

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#27

Name- Lee Podedworny

Annual Earning- $106,838.16

Postition- Fire-4

City- South Kingstown

State- RI

Retirement Type- Accidental Disability

Retirement Date- July 23, 1992

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#26

Name- Nancy Donahue

Annual Earning- $107,757.24

Postition- Fire-4

City- Warwick

State- RI

Retirement Type- Beneficiary

Retirement Date- July 1, 2005

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#25

Name- Domenic Pono

Annual Earning- $107,850.72

Postition- Fire-4

City- Cranston

State- RI

Retirement Type- Accidental Disability

Retirement Date- December 19, 1991

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#24

Name- John Murphy

Annual Earning- $107,892.84

Postition- Fire-4

City- Providence

State- RI

Retirement Type- Accidental Disability

Retirement Date- December 19, 1991

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#23

Name- Robert Carlson

Annual Earning- $108,555.36

Postition- Fire-4

City- Greenville

State- RI

Retirement Type- Accidental Disability

Retirement Date- April 24, 1991

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#22

Name- Robert Emmett

Annual Earning- $109,256.16

Postition- Police-5

City- Cranston

State- RI

Retirement Type- Service

Retirement Date- November 13, 1990

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#21

Name- Thomas Doyle

Annual Earning- $109,329.24

Postition- Fire-4

City- West Warwick

State- RI

Retirement Type- Accidental Disability

Retirement Date- August 26, 1988

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#20

Name- Joseph Errico

Annual Earning- $109,611.60

Postition- Fire-4

City- Warwick

State- RI

Retirement Type- Service

Retirement Date- June 30, 1995

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#19

Name- Edward MacDonald

Annual Earning- $110,225.64

Postition- Fire-4

City- Johnston

State- RI

Retirement Type- Accidental Disability

Retirement Date- May 26, 1994

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#18

Name- Alfred Lamothe

Annual Earning- $110,505.96

Postition- Fire-4

City- Warwick

State- RI

Retirement Type- Accidental Disability

Retirement Date- September 6, 1991

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#17

Name- Ernest Silva

Annual Earning- $112,796.28

Postition- Fire-4

City- Ft. Myers

State- FL

Retirement Type- Accidental Disability

Retirement Date- April 24, 1991

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#16

Name- Edward Dolan

Annual Earning- $113,126.04

Postition- Fire-4

City- North Kingstown

State- RI

Retirement Type- Accidental Disability

Retirement Date- December 19, 1991

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#15

Name- Paul Marianetti

Annual Earning- $113,331.60

Postition- Fire-4

City- Ormond Beach

State- FL

Retirement Type- Accidental Disability

Retirement Date- November 17, 1994

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#14

Name- Rosemary Clark

Annual Earning- $114,725.64

Postition- Police-5

City- Chepachet

State- RI

Retirement Type- Beneficiary

Retirement Date- August 1, 2004

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#13

Name- John Gannon

Annual Earning- $117,318.60

Postition-Police-5

City- Coventry

State- RI

Retirement Type- Accidental Disability

Retirement Date- January 24, 1991

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#12

Name- Marcia Moise

Annual Earning- $119,791.20

Postition- Fire-4

City- Jupiter

State- FL

Retirement Type- Beneficiary

Retirement Date- April 1, 1997

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#11

Name- Robert Read

Annual Earning- $123,105.00

Postition- Fire-4

City- Cranston

State- RI

Retirement Type- Accidental Disability

Retirement Date- December 19, 1991

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#10

Name- Alfred Bertoncini

Annual Earning- $123,599.16

Postition- Fire-4

City- Smithfield

State- RI

Retirement Type- Service

Retirement Date- December 19,1994

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#9

Name- Victor Dichiara

Annual Earning- $126,845.28

Postition- Fire-4

City- East Greenwich

State- RI

Retirement Type- Accidental Disability

Retirement Date- December 17, 1992

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#8

Name- Edmund Calcagni

Annual Earning- $135,702.72

Postition- Police-5

City- North Providence

State- RI

Retirement Type- Accidental Disability

Retirement Date- December 29, 1990

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#7

Name- James Kelly

Annual Earning- $137,336.04

Postition- Fire-4

City- Greenville

State- RI

Retirement Type- Accidental Disability

Retirement Date- September 28, 1988

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#6

Name- Vincent Delisi

Annual Earning- $145,520.88

Postition- Fire-4

City- North Providence

State- RI

Retirement Type- Accidental Disability

Retirement Date- December 17, 1992

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#5

Name- William Manchester

Annual Earning- $148,839.84

Postition- Fire-4

City- Warwick

State- RI

Retirement Type- Accidental Disability

Retirement Date- December 19, 1991

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#4

Name- William D'Iorio

Annual Earning- $156,870.60

Postition- Fire-4

City- Smithfield

State- RI

Retirement Type- Accidental Disability

Retirement Date- Novemver 29, 1990

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#3

Name- Anthony Sauro

Annual Earning- $161,487.24

Postition- Fire-4

City- Johnston

State- RI

Retirement Type- Accidental Disability

Retirement Date- July 5, 1991

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#2

Name- Robert Anthony

Annual Earning- $162,944.04

Postition- Fire-4

City- Smithfield

State- RI

Retirement Type- Accidental Disability

Retirement Date- September 25, 1991

Source: This information was secured through a FOIA request from the city of Providence.

Prev Next

#1

Name- Gilbert McLaughlin

Annual Earning- $196,813.08

Postition- Fire-4

City- Warwick

State- RI

Retirement Type- Accidental Disability

Retirement Date- October 24, 1991

Source: This information was secured through a FOIA request from the city of Providence.

 
 

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