State of Denial
Thursday, June 02, 2011
It has been just over a week since State Treasurer Gina Raimondo stood before the Governor, mayors, and leadership of the state’s major unions and emphasized that we are past the point of blame, but that, as a state, we now must move together to rein in the insurmountable costs of the public pension debt.
But a quick scan of developments occurring around the state over the past week does not give one much optimism that leadership—or rank and file—of local and statewide unions really heard that message, or most importantly, are ready to accept what that truly means.
Just look at several prominent union challenges presently underway to either retain or regain jobs, keep present levels of compensation, or secure compounded COLA benefits.
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In North Providence, a court challenge is underway over what appears on the surface to be an extra COLA awarded to firefighters collecting a disability pension. But it seems the practice, which ever feisty Mayor Charlie Lombardi is rightly contesting, amounts to a silver anniversary gift of sorts because it occurs once a firefighter reaches the 25th anniversary of their own original hiring date. (Huh? Do they receive silver candlesticks or something as well?!) The case is proceeding to Superior Court because an arbitrator ruled the new, compounded COLA is legitimate. The town’s attorney, Vincent F. Ragota, Jr., who labeled that ruling “irrational,” is arguing that the disability pension retirees already start collecting a tax-free pension that’s worth two-thirds of salary, which is then supplemented with added on payments bumping it to about 100 percent of original pay, plus they receive a standard 3 percent COLA. Though the “silver anniversary” compounded COLA is the court issue, what’s really at issue will be that if the town loses, the base threshold at which all future town disability pensions are set will increase. North Providence presently carries an unfunded pension liability of over $24 million just for firefighters alone. Stay tuned.
In fiscally collapsing Providence over the past week it probably came as little surprise that unhappy police officers were reportedly calling in sick over the holiday weekend at higher rates than normal. Though the official word on whether or not there was a “blue flu” erupting was that there was not, the tension is building as Mayor Taveras has ordered up to 80 officers to be laid off if the unions don’t quickly come to the table for substantial contract concessions. How many other ways can the beleaguered Mayor articulate “we are under water, folks… and we won’t be able to give you a paycheck, never mind a pension….” if you can’t agree to substantial concessions. Providence can only be saved from a thundering fiscal fall if all its unions start to “get it” and soon.
Unions undermining reform in Central Falls
Over in fiscally bankrupted Central Falls, a $105,000-a-year administrator is taking the district to court to retain her position. As reported days ago by GoLocalProv, Elizabeth Legault, who has continued to collect her $105,000 salary while out on administrative leave since last October, may have been among those questioning certain new approaches to discipline at the still deeply troubled high school. Regardless of the outcome of the Legault case, the wider strategy of both the teacher’s union and another school employees union, with the ongoing encouragement of Senator John Tassoni, seems to be to undermine the difficult reform work of Gallo in an effort to ultimately push her aside. (Both unions predictably recently voted no confidence in Gallo’s leadership.)
Finally, there is the curious proposal from none other than statewide NEA Executive Director Robert Walsh that the state should consider selling the Twin River gambling facility as a full-fledged casino and steer the profit toward the pension fund and ………hey, unfunded liability problem solved. So let’s see. The state’s third largest revenue source, among a dwindling list of revenue sources, which is presently generating roughly $250 million annually toward state budget needs, could be ramped up to casino status, the license sold for what he estimates is a multi-billion dollar value, the unions get to keep pensions intact, and the state debt goes away. But the underlining problem doesn’t go away. Long before retirees get to be retirees, it’s the dozens and dozens of local budget crushing mandates, contract provisions and benefits attached to their work life which need to be reformed to truly pare down costs to communities.
What the hard truth about the truth in numbers means is that reforming the cost of public sector retirement is going to mean reining in the cost of public sector compensation, period.
It appears what we have now is a state still in denial.
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Donna Perry is a Communications Consultant to RI Statewide Coalition www.statewidecoalition.com
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