Chart: The decline and fall of the Providence pension system
January 25th, 2012 at 6:00 am by Ted Nesi under Nesi's Notes, On the Main Site
It’s almost impossible to overstate the amount of damage done to Providence’s pension system by three decisions: the union-controlled Retirement Board’s costly COLA vote in 1989; Mayor Cianci’s consent decree agreeing to the COLAs in 1991; and the Rhode Island Supreme Court’s decision [pdf] upholding Cianci’s decree in 2000.
The crucial year on paper was 1996, when an earlier ruling first forced the city to acknowledge the pension benefits awarded in 1989 on its books. The city’s unfunded pension liability shot from $167 million to $412 million, and its funded level plunged from 64% to 41%.
Take a look at this chart – the bleeding hasn’t stopped:
More coverage of Providence’s pension crisis on WPRI.com:
- Providence is only no-show at Raimondo’s local pension event (Jan. 24)
- COLA means $796,871 pension for ex-fire chief if he lives to 100 (Nov. 30)
- Sen. Ruggerio tried to award 6% pension COLAs in Providence (Nov. 30)
- Mansolillo: Providence pension fund hit by ‘comedy of errors’ (Nov. 28)
- Chafee, Taveras plea for pension aid for ‘too-big-to-fail’ cities (Oct. 18)
- Providence pensions look like next target for Taveras, council (Oct. 7)
Tags: angel taveras, buddy cianci, municipal, non-MERS, pensions, providence, providence financial crisis, providence retirement board, raimondo-chafee
Nesi's Notes covers politics and the economy in and around Rhode Island for WPRI.com. (Twitter: 
Ted keep up doing the good work. I am tired of the news media in this market giving elected officals and civil servants a walk. It is time to let them know they answer to the public, not that the public answers to them. Question the FOP why they want a cop who was convicted of maturbating in public still on the job. Why they want the Lincoln cop on the job. Why are they wasting taxpayers money elminating criminal police. Other police forces are breaking the thin blue line. In Rhode Island it is getting stregthen with other public services employees. Maybe the public sector union workers need an education. FDR supported PRIVATE sector unionts. He was against PUBLIC sector unions. Rhode Island messiah was against municipal unions. It is time to break the municipal unions.
[...] Chart: The decline and fall of the Providence pension system [...]
I am surprised no comments from the peanut gallery about what I stated before. Now it is time to reduce pay of all Rhode Island public sector employees by 20%, make them pay 35% of the cost of their health insurance. Cut the retirees pension by 50%. Keep the COLA out of the picture for the 19 years. For all employees convert them to a 401k type retirement plan.
[...] I am inspired by Nesi’s poston the rapid decline of the Providence municipal pension fund health that occurred since 6% [...]
[...] story in today’s Projo about the challenge Mayor Taveras faces in trying to claw back those hugely expensive pension COLAs granted back in 1989. What many people don’t seem to understand – including some [...]
[...] was “in excellent financial condition” just 15 months ago will live in infamy. But the 6% COLAs and lifetime Blue Cross that are crushing the capital are vestiges of Buddy Cianci’s [...]