Chafee says locally administered pensions will be part of the plan
Governor Lincoln Chafee says Rhode Island’s troubled locally administered pension plans will be part of the reform plan he’s submitting later this month with Treasurer Gina Raimondo.
Chafee talked about the issue during a taping this morning of WPRI/WNAC-TV’s Newsmakers. He told me this after the show:
The goal is not to violate any kind of collective bargaining agreements, but at the same time make sure the state oversees some of the parameters of these independent municipal plans so they don’t come back to haunt us at the state level.
The locally administered pensions represent more than $2 billion in unfunded liability (in addition to the roughly $7 billion unfunded tab for state-managed pensions), and the most troubled of the muni pensions have minimal funding levels. Addressing the local pensions is also more legally complex, as Chafee indicated, since they were set through collective bargaining.
During Newsmakers, Chafee said letting the local pensions go unaddressed could cause fiscal distress like that seen in Central Falls.
Under questioning from Tim White, Ted Nesi, and myself, Chafee declined to offer specifics about the pension plan due to be rolled out, perhaps as soon as next week. Chafee and Raimondo have previously indicated they are considering a hybrid plan, COLA adjustments, and some degree of re-amortization.
Chafee v0wed that his approach to the pension crisis will be substantial. “We’re not going to be back [dealing with it] in 2014,” he said.