New study by ALEC praises Raimondo for pension changes

August 13th, 2013 at 12:01 am by under Nesi's Notes, On the Main Site

A new study out Tuesday offers more praise for Treasurer Gina Raimondo’s approach to pension changes, though it may also offer new fodder for her political opponents.

The study by Dan Liljenquist, a former Utah state senator who unsuccessfully challenged Orrin Hatch for the Republican U.S. Senate nomination last year, was released by the American Legislative Exchange Council (ALEC), a right-leaning group which has drawn criticism from Rhode Island liberals in the past.

The study, “Keeping the Promise: State Solutions for Government Pension Reform,” paints a bleak picture of pension systems’ current funding levels nationwide, and argues lawmakers should look to Rhode Island as one example of how they can reduce the costs to taxpayers.

“Rhode Island has gained both notoriety and praise for its pension reforms,” Liljenquist writes. “Although some legislators launch study groups or hold hearings but do not change anything, Rhode Island made some significant changes in just 11 months.”

Liljenquist writes that “Raimondo was rewarded for her work” reaching out to unions and workers. But he also says lawmakers could “easily and quietly” boost benefits in the future, and suggests that failing to eliminate defined-benefit plans for all retirees “means maintaining some further exposure to bankruptcy risk.”

The full study is available on ALEC’s website. Its praise for Raimondo contrasts with the criticism the pension law received in June in a study released by the left-leaning Economic Policy Institute, another national group.

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11 Responses to “New study by ALEC praises Raimondo for pension changes”

  1. Mr.Fish says:

    Manhattan Institute, ALEC, Enron….the Republican primary sure is going to be very busy with Gina, Alan, and John.

  2. Blog Me says:

    Fung will curl up and run soon. You will see he has no testicular fortitude to run for Governor …. He always has, and will always be a lame politician.

  3. RealClear says:

    ALEC– KOCH brothers funded.
    Free first class junkets for the worst kind of elected officals. Bills are handed to them to introduce back home.

  4. Bob says:

    the pension reform isn’t finalized yet. After all ding-dong Chaffee is renegotiating it. Probably make us ‘commoners’ fork over more of our crops to keep the aristocracy happy.

    1. SteveD says:

      Bob, ask yourself a question. If the pension bill was on solid legal grounds, would the judge have asked for negotiations? My take is, the state will lose big time in court. Then we will be asking, why didn’t we negotiate!

      1. George says:

        The judge asking for more negotiations is just a normal part of the process. It will be horrible for Rhode Island if the court decides in the favor of the retiree’s. It will cause some more bankruptcies and more pensioner’s to lose over half their pensions. But, what do the state retiree’s care. As long as they get theirs, screw everybody else.

      2. SteveD says:

        George, it is not part of the normal course of things. Just like a TRO, there has to be some proof that the person getting the TRO will likely win. Providence received a TRO in the Medicare lawsuit. The judges ruling said that they will be likely prevail. I think she is thinking the same thing. Remember the judge already said that the pension was a contract. So I think the handwriting is on the wall.

  5. George says:

    Steve, I’m going to guess a TRO is a temporary restraining order. That may be the case, I’m not a lawyer but as I understood it from press reports when this happened it was expected by the state. Either way the status quo wasn’t sustainable. Since its not legal (yet) for states to declare bankruptcy the state will have to slash aid to Providence, Woonsocket, Etc. If this ends well for the unions, it will not end well for the towns. Does this concern you?
    Unfortunately, my wife loves her job and we’re not moving, so I will continue to see cuts in services, while my taxes are raised every year. Despite falling home valuations I paid exactly 4% (4% in dollars the tax rate was raised much more. Kind of odd that when the city did the revaluation it came to EXACTLY a 4% increase) more on my property taxes. Almost every penny in additional revenue goes to plug pension benefit shortfalls. Meanwhile or schools have been level funded for years and police and fire agreed to no pay raises for three years. So we have declining population, falling home values, rising taxes, cuts to city services. Sound familiar, I’m not talking about Detroit, I’m talking about Warwick and we’re looked at as one of the better functioning municipalities. The city and Rhode Island need to face the challenges ahead.
    We are a high tax, high unemployment, high debt state. Large states and cities with thriving economies in similiar fiscal condition will be able to hold out longer, but we will be on the first wave the pending fiscal disaster.

    1. SteveD says:

      George, then why are you not holding your elected officials accountable? They are the ones that short funded the system, so people like you would re-elect them every year! Fact is, if they could not afford it, then why did thy promise it? Was it alright for me to give up raises in 5 years in the 90s, because the city said we had good benefits. Then go back on those same benefits? I don’t see any other contracts being broken. This includes tax abatement contracts with G-tech, Providence Place mall, and the hundreds of other state and city tax treaties. Nope only the employee contract was broken. Yale pays New Haven 4 times what Brown pays. I do not want to see BR in any community, however the problem started about 9 years ago when Gov. Carcieri gutted city and town aid. If left alone, it would have cost about $100 per RI taxpayer. Instead the Property taxes went through the roof. And before you say anything about cutting. Providence alone lost 65 million dollars in state aid, over 10% of the budget. Since school spending could not be cut due to Carullo, well they just kept dipping into the pensions.

      1. George says:

        Steve, you can’t blame any of this on my votes. There are two people in office today that I voted for. One is on the school council and one is on the city council. The other school board member I voted for was an incumbent that was targeted by the unions and lost to their candidate. Who then voted the union a new contract and a raise (WISE). No the unions have dictated what happens in RI for a long time now. This is your fault and the fault of your leadership. When the politicians didn’t fund the pensions each and every year you should have backed politicians that did. You didn’t care how much the taxpayers were getting screwed as long as your pensions were safe. Your in denial if you don’t see that public sector unions and crooked politicians created this mess.
        Aid to cities was cut under Carcieri but it wasn’t restored under Chafee. Because we’ve run out of money. Naturally unions and retiree’s want more revenue. So do the taxpayers, but we want it through growth. Not squeezing every cent out of the existing contributors left.
        Its simple cities and states that have spent what they could afford and not what they could borrow are doing well. Those states that spent what they could borrow, well that’s us.

  6. snow says:

    Let’s not forget why the state’s share of the pension contribution went up–Raimondo reduced the interest rate and upped the mortality table to 87 years old. She rigged this to get the legislation passed, to set herself up for her future prospects. Forget that the state hasn’t contributed what it should have all along, the fact is that retirees and active workers pensions are really not that expensive for the state. Workers pay one of the highest rates for their pensions, and these pension benefits (according to Politifact) are middling at best.