organized labor

GOP-union alliance scrambles RI lieutenant gov. campaign

October 16th, 2014 at 12:00 pm by under Nesi's Notes

By Ted Nesi

PROVIDENCE, R.I. (WPRI) – Organized labor is usually one of the most reliable constituencies for Democratic politicians in Rhode Island, but this year many unions are taking an unusual step: backing a Republican.

It reflects how the sleepy race for lieutenant governor is scrambling some of Rhode Island’s usual political alliances. A WPRI 12/Providence Journal poll released Tuesday showed Democrat Dan McKee leading Republican Catherine Taylor 36% to 27%, but nearly one in three voters – 31% – were still undecided.

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RI union SEIU 580 votes down 4-year contract with state

May 19th, 2014 at 10:03 pm by under Nesi's Notes

By Ted Nesi and Carl Sisson

PROVIDENCE, R.I. (WPRI) – In a surprise move, members of the Service Employees International Union Local 580 on Monday voted down a proposed new four-year contract with the state.

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Despite settlement, pension lawsuit trial still set for Sept. 15

February 24th, 2014 at 3:42 pm by under Nesi's Notes, On the Main Site

Preparations for a September trial in the union lawsuit challenging Rhode Island’s landmark 2011 pension overhaul are still happening despite the high-profile announcement of a proposed settlement to end the suit.

Court spokesman Craig Berke confirmed Monday that the Sept. 15 start date for the pension lawsuit trial remains in place. R.I. Superior Court Judge Sarah Taft-Carter set the date on Feb. 12, just hours after the first press conference to announce the pension settlement was abruptly postponed.

Berke told WPRI.com that if the proposed settlement hasn’t been approved by Sept. 15 – which would require affirmative votes by workers, retirees and state lawmakers – the trial will begin as scheduled.

Judge Taft-Carter ordered lawyers on both sides of the pension suit to begin coming up with an agreed-upon schedule for the pre-trial discovery phase when evidence will be collected. The judge also ordered that discovery should be completed by 30 days before Sept. 15.

The trial, like the settlement, would cover not only unions’ challenge to the 2011 pension overhaul but also their earlier suit opposing pension cuts enacted by the General Assembly in 2009 and 2010. The two sides presumably could still complete a settlement and end the litigation after the trial begins, however.


Why the pension settlement may save even more than $3.9B

February 19th, 2014 at 6:12 pm by under Nesi's Notes, On the Main Site

Much of the reporting about last week’s pension settlement has focused on the number $3.9 billion, which is the amount of savings the deal would lock in compared with the status quo before the 2011 overhaul.

But that may actually understate the amount of savings state officials would lock in by getting unions and retirees to approve the settlement. The reason is because under the terms of the deal, the unions and retirees wouldn’t just drop their lawsuits challenging the 2011 law – they’d also drop an earlier lawsuit that aims to overturn pension changes made by the General Assembly in 2009 and 2010.

The savings from the 2009 and 2010 changes weren’t included in the estimates put out during last week’s settlement announcement, which used as its baseline the unfunded pension liability at the time of the 2011 overhaul (currently estimated at $8.9 billion, including $8.3 billion for state employees and teachers). There’s no comparable estimate for the 2009 and 2010 changes available online at this time.

(more…)


Lawyers give judge 17th update on secret pension talks

February 3rd, 2014 at 5:39 pm by under Nesi's Notes

By Ted Nesi

WARWICK, R.I. (WPRI) – Lawyers briefed the Rhode Island judge overseeing a union lawsuit challenging the state’s 2011 pension overhaul for the 17th time last week but still haven’t announced any proposed settlement.

Another status conference has been scheduled for Feb. 14, and an interim one may be held Feb. 6.

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Lawyers give 16th update on secret pension talks; back Friday

January 27th, 2014 at 2:51 pm by under Nesi's Notes

By Ted Nesi

WARWICK, R.I. (WPRI) – Lawyers briefed the Rhode Island judge overseeing a union lawsuit challenging the state’s 2011 pension overhaul for the 16th time Monday and will be back at the courthouse later this week, as talk of a potential settlement continues to swirl.

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No pension settlement yet as lawyers meet for 15th time

January 17th, 2014 at 5:28 pm by under Nesi's Notes

By Dan McGowan

WARWICK, R.I. (WPRI) – Lawyers briefed the Rhode Island judge overseeing a union lawsuit challenging the state’s 2011 pension overhaul for the 15th time Friday as talk of a potential settlement continues to swirl.

Reporters were camped inside of Judge Sarah Taft-Carter’s courtroom at Kent County Superior Court as state and union lawyers met behind closed doors. The lawyers refused to comment, citing a court-imposed gag order.

Taft-Carter ordered the two sides into a formal, closed-door mediation process overseen by the Federal Mediation and Conciliation Service in December 2012.

The next status conference has been scheduled for Monday, Jan. 27 at 9 a.m. in the same location.

The update came in the same week that Gov. Lincoln Chafee proposed a 2014-15 budget to lawmakers that didn’t allocate any funding toward a potential settlement. During a taping of WPRI 12’s Newsmakers, Chafee said that if a settlement was reached and the General Assembly approved changes to the pension law, the state budget wouldn’t be affected until the 2015-16 fiscal year.

“Everybody’s anxious to see that number,” Chafee said.


14th briefing held on pension talks as settlement rumors swirl

January 10th, 2014 at 4:31 pm by under Nesi's Notes, On the Main Site

There’s no pension settlement – yet.

The judge overseeing a union lawsuit challenging Rhode Island’s 2011 pension overhaul got another progress report Friday about the status of the two sides’ court-ordered mediation talks, as rumors swirl that they are close to announcing a settlement agreement which would avoid a trial.

Officials involved in the talks met this morning with R.I. Superior Court Judge Sarah Taft-Carter, court spokesman Craig Berke said. Taft-Carter ordered the state and the unions into a formal, closed-door mediation process overseen by the Federal Mediation and Conciliation Service in December 2012.

Berke said Taft-Carter scheduled the next status conference for Friday, Jan. 17 at 9 a.m. at Kent County’s court.

The meeting came a day after House Majority Leader Nicholas Mattiello, D-Cranston, said during an interview on WPRI 12′s Newsmakers that it’s possible state lawmakers – who aren’t part of the pension talks but still need to approve any deal – could simply ignore a settlement proposal entirely.

Friday’s status conference was the 14th one the two sides have held since last winter and the second one held this week. The previous ones were on Jan. 6, Dec. 9, Nov. 21, Nov. 12, Oct. 28, Sept. 30, Sept. 5, Aug. 6, May 17, April 22, March 25, Feb. 28 and Feb. 1.


RI lawmakers could ignore proposed pension suit settlement

January 10th, 2014 at 10:06 am by under Nesi's Notes

By Tim White and Ted Nesi

PROVIDENCE, R.I. (WPRI) – House Majority Leader Nicholas Mattiello, one of Rhode Island’s most influential lawmakers, says he wouldn’t be shocked if the legislature simply ignored any proposed settlement that emerges from secret court-ordered talks over the sweeping 2011 pension reform law.

Read the rest of this story »

• Related: RI lawmakers worried about secret talks to rewrite pension law (Oct. 15)


Judge gets 13th briefing on RI pension suit talks; returning Fri.

January 6th, 2014 at 10:26 am by under Nesi's Notes, On the Main Site

The judge overseeing a union lawsuit challenging Rhode Island’s 2011 pension overhaul got another progress report on Monday about the progress of their court-ordered mediation talks – but it’s not the only update she’s set to receive from them this week.

Attorneys on both sides of the suit met this morning with R.I. Superior Court Judge Sarah Taft-Carter, court spokesman Craig Berke said. Taft-Carter ordered the state and the unions into a formal, closed-door mediation process overseen by the Federal Mediation and Conciliation Service in December 2012.

Berke said Taft-Carter scheduled another status conference for Friday at 9 a.m. in Kent County Superior Court – the first time since the talks began that she asked to receive two updates in one week. The scheduling move will likely add more fuel to speculation that the two sides are getting closer to a deal.

Monday’s status conference was the 13th one the two sides have held since last winter. The previous ones were on Dec. 9, Nov. 21, Nov. 12, Oct. 28, Sept. 30, Sept. 5, Aug. 6, May 17, April 22, March 25, Feb. 28 and Feb. 1. Monday’s meeting was originally scheduled for Friday but was delayed by the nor’easter.

• Related: RI lawmakers worried about secret talks to rewrite pension law (Oct. 15)


Nor’easter postpones next pension mediation update to Mon.

January 2nd, 2014 at 3:43 pm by under Nesi's Notes, On the Main Site

Nor’easters are an even bigger deal than pensions.

R.I. Superior Court Judge Taft-Carter has postponed Friday’s scheduled status conference on mediation of the lawsuit against Rhode Island’s 2011 pension law. She is now scheduled to receive an update from lawyers in the suit on Monday, Jan. 6 at 9 a.m. at Kent County Superior Court.

Monday’s status conference will be the 13th one since last winter. The previous ones were on Dec. 9, Nov. 21, Nov. 12, Oct. 28, Sept. 30, Sept. 5, Aug. 6, May 17, April 22, March 25, Feb. 28 and Feb. 1.

• Related: RI lawmakers worried about secret talks to rewrite pension law (Oct. 15)


Lawyers brief judge for 12th time on RI pension lawsuit talks

December 9th, 2013 at 12:56 pm by under Nesi's Notes, On the Main Site

Lawyers briefed the judge overseeing a union lawsuit challenging Rhode Island’s 2011 pension overhaul once again Monday about the progress of their court-ordered mediation to settle the case.

Attorneys on both sides of the suit met this morning with R.I. Superior Court Judge Sarah Taft-Carter, court spokesman Craig Berke said. It was a year ago next Wednesday that she ordered the state and the unions into a formal, closed-door mediation process overseen by the Federal Mediation and Conciliation Service.

The frequency of the status conferences has been picking up in recent weeks, with four held in the last month and a half, fueling speculation that the two sides are closing in on a deal. But the next one won’t take place until after the holidays: Taft-Carter scheduled it for Jan. 3 at 9 a.m., Berke said.

Monday’s status conference was the 12th one the two sides have held since last winter. The previous ones were on Nov. 21, Nov. 12, Oct. 28, Sept. 30, Sept. 5, Aug. 6, May 17, April 22, March 25, Feb. 28 and Feb. 1.

• Related: RI lawmakers worried about secret talks to rewrite pension law (Oct. 15)


Study: RI has highest level of private-sector jobs in the US

December 2nd, 2013 at 3:29 pm by under Nesi's Notes, On the Main Site

Here’s a statistic that won’t surprise regular Nesi’s Notes readers but may surprise others.

A new study by the libertarian-leaning Mercatus Center at George Mason University shows Rhode Island has the largest percentage of real private-sector jobs in the country: 85.7% of total employment. The study defines “true” private-sector jobs as those that aren’t financed by the federal government, whether the individual is employed directly or through a contractor.

“Direct government employment fails to capture the full impact of government spending on state labor markets,” the authors write. “Using federal contract data obtained from USAspending.gov, we estimated the percentage of private sector jobs actually financed by federal contract dollars in each state.”

Here’s the map:

map3

Just 1.4% of private-sector jobs in Rhode Island are funded by federal contracts, compared with 5% in Connecticut and 3.5% in Massachusetts. The share ranges from 10.7% in Virgina to 0.7% in Oregon.

Another Mercatus map includes the depressing statistic that Rhode Island lost 5.4% of its real private-sector jobs between 2007 and 2012, one of the larger decreases in the country:

map4

This is just the latest evidence that Rhode Island’s active public payroll isn’t as enormous as some seem to think. A recent New York Times analysis found Rhode Island has the second-fewest government workers among the 50 states after moving aggressively to cut jobs during the recession. Government employment in Rhode Island as a share of the population is now at the lowest level since at least 1990.

But government employment and government spending aren’t always the same thing. These analyses don’t show the size of Rhode Island’s retired public payroll (pensioners) or the level of spending by the public sector. Much of the state’s $2 billion in Medicaid spending, for example, doesn’t employ state workers directly.

• Related: RI has 2nd-lowest level of government employment in the US (Oct. 7)


Lawyers brief judge for 11th time on RI pension lawsuit talks

November 25th, 2013 at 11:34 am by under Nesi's Notes

Lawyers briefed the judge overseeing a union lawsuit challenging Rhode Island’s 2011 pension overhaul once again last week about the progress of their court-ordered mediation to settle the case.

Attorneys on both sides of the suit met last Thursday morning with R.I. Superior Court Judge Sarah Taft-Carter, court spokesman Craig Berke said. Last December she ordered the state and the unions into a formal, closed-door mediation process overseen by the Federal Mediation and Conciliation Service.

The “status quo” in the pension talks continues, Berke said after conferring with Taft-Carter.

Thursday’s status conference took place less than two weeks after the previous one as the time frame between meetings shrinks, which has fueled rising speculation that the two sides are nearing an agreement. The next status conference will be Dec. 9 at 9 a.m., almost a year after Taft-Carter ordered talks to begin.

A union leader revealed in August that a subcommittee has been formed to communicate with workers and retirees about the terms of a settlement, which Gov. Lincoln Chafee has repeatedly said he hopes will work out. Some state lawmakers, however, have expressed concerns about what that would mean.

Thursday’s status conference was the 11th one the two sides have held since last winter. The previous ones were on Nov. 12, Oct. 28, Sept. 30, Sept. 5, Aug. 6, May 17, April 22, March 25, Feb. 28 and Feb. 1.


Lawyers brief judge for 10th time on RI pension lawsuit talks

November 12th, 2013 at 2:31 pm by under Nesi's Notes, On the Main Site

Lawyers on Tuesday once again briefed the judge overseeing a union lawsuit challenging Rhode Island’s 2011 pension overhaul about the progress of their court-ordered mediation to settle the case.

Attorneys on both sides of the suit met late Tuesday morning with R.I. Superior Court Judge Sarah Taft-Carter, court spokesman Craig Berke said. Last December she ordered the state and the unions into a formal, closed-door mediation process overseen by the Federal Mediation and Conciliation Service.

Tuesday’s status conference took place just two weeks after the last one, a much shorter time frame between meetings than in the past, which has added to speculation that the two sides are nearing an agreement. That buzz will likely grow now: Berke said the next status conference will be Nov. 21, a week from Thursday.

A union leader revealed in August that a subcommittee has been formed to communicate with workers and retirees about the terms of a settlement, which Gov. Lincoln Chafee has repeatedly said he hopes will work out. But some state lawmakers have expressed concerns about what that would mean.

Tuesday’s status conference was the tenth one the two sides have held since last winter. The previous ones were on Oct. 28, Sept. 30, Sept. 5, Aug. 6, May 17, April 22, March 25, Feb. 28 and Feb. 1.

• Related: RI lawmakers worried about secret talks to rewrite pension law (Oct. 15)


Lawyers brief judge for 9th time on RI pension lawsuit talks

October 28th, 2013 at 6:43 pm by under Nesi's Notes, On the Main Site

Lawyers briefed the Rhode Island judge overseeing a union lawsuit challenging the state’s 2011 pension overhaul Monday for a ninth time about the progress of their court-ordered mediation to settle the case.

Attorneys on both sides of the suit met Monday with R.I. Superior Court Judge Sarah Taft-Carter, court spokesman Craig Berke said. Last December Taft-Carter ordered the state and the unions into a formal mediation process behind closed doors overseen by the Federal Mediation and Conciliation Service.

The buzz continues to build about the possibility that the two sides are nearing an agreement, which has some state lawmakers expressing serious concerns about the process. A union leader recently revealed that a subcommittee has been formed to communicate with workers and retirees about the terms of a settlement, which Gov. Lincoln Chafee has repeatedly said he hopes will work out.

The buzz will likely grow because Taft-Carter will hold the next status conference in just two weeks, according to Berke – a much shorter time between meetings than in the past. The last eight status conferences were held on Sept. 30, Sept. 5, Aug. 6, May 17, April 22, March 25, Feb. 28 and Feb. 1.

• Related: RI lawmakers worried about secret talks to rewrite pension law (Oct. 15)


Teamsters leader in hot water over comments at RI rally

October 23rd, 2013 at 10:00 am by under Nesi's Notes

By Tim White

EAST PROVIDENCE, R.I. (WPRI) – The highest ranking Teamsters official in New England is facing possible disciplinary action for comments he made at a union election rally in Rhode Island.

Read the rest of this story »


RI lawmakers worried about secret talks to rewrite pension law

October 15th, 2013 at 5:00 am by under Nesi's Notes

By Ted Nesi

PROVIDENCE, R.I. (WPRI) – There’s growing anxiety among Rhode Island lawmakers about secret court-ordered talks between state leaders and public-sector unions, who appear to be closing in on a deal that will change the state’s landmark 2011 pension law significantly.

The uncertainty emerged last week after House Democrats discussed the pension talks at a closed-door caucus in West Greenwich. Rank-and-file lawmakers were addressed separately by Gov. Lincoln Chafee and Treasurer Gina Raimondo, who were ordered into mediation by Superior Court Judge Sarah Taft-Carter in a bid to settle the unions’ suit challenging the law.

“I’m very concerned with opening that whole debate again because it’s already been debated,” Rep. Jared Nunes, D-Coventry, told WPRI.com. “No matter where you stood on that, as far as a legislator is concerned, whether you stood on the side of the state employees or stood on the side of the taxpayers, you got that thing jammed down your throat.”

“They’re out of their minds,” added Nunes, who did not attend the caucus himself.

Taft-Carter has imposed a gag order on Chafee, Raimondo and everyone else directly involved in the pension negotiations. But members of the General Assembly are not party to the talks.

Multiple lawmakers who attended the caucus refused to say if Chafee told them he will need to ask for extra money in his proposed 2014-15 state budget next January to cover increased spending on pensions. State leaders are already facing a projected shortfall of roughly $170 million in the budget.

“It was a closed meeting and the things that they discussed are best kept in that room,” Chafee spokeswoman Christine Hunsinger told WPRI.com. “It’s way too early to know exactly what form the budget will take. Obviously, there are many decisions that will need to be made.”

The final version of the pension law, known as the Rhode Island Retirement Security Act, suspended benefit increases for roughly two decades and transitioned employees into a hybrid plan that includes a 401k-style defined-contribution account. The changes slashed the state’s long-term unfunded pension liability from $7.3 billion to $4.3 billion, and lowered the state’s last annual pension contribution from roughly $400 million to $242 million, according to Raimondo’s office.

Rep. Michael Marcello, D-Scituate, acknowledged the proposed pension deal may raise costs for taxpayers starting next year. “It is clear that negotiations are continuing and that there is a potential that any settlement may have an increased cost from a budgetary perspective,” he told WPRI.com.

Marcello said lawmakers were not given any timeline of when a possible settlement is expected to be finalized, and expressed frustration about the lack of information being shared with lawmakers.

“We’re all in the dark, and from my perspective I am concerned – from an institutional perspective – about a court kind of bootstrapping or telling the legislature what to do,” he said. “To me, there’s a huge separation-of-powers issue. … I’m not happy about the fact that the settlement is being done behind closed doors after having sat through all those previous [pension] hearings.”

“There’s no question in my mind we don’t have to approve any settlement,” he added. “We do not have to do it.”

Rep. Arthur Handy, D-Cranston, said the discussion of the settlement at the caucus was “very thin on details,” which left a number of his colleagues “anxious” about what’s coming down the pike.

“The fact that people are so unable to tell us anything makes you – it’s like the thing where somebody says, ‘I can’t tell you about it now’ – you really start to worry that there’s something there,” Handy told WPRI.com.

There are signs a settlement may be coming together.

Lawyers are scheduled to brief Taft-Carter on the progress of their talks for a ninth time later this month, and in August a union leader revealed that the plaintiffs have formed a subcommittee to communicate with workers and retirees about the terms of a settlement. Raimondo, meanwhile, is expected to run for governor next year.

Handy said a key question is how legislators would be expected to handle a draft settlement once it was given to them for their approval by Chafee, Raimondo and the unions. “The struggle would be, can we make changes?” he said. “If a judge says, ‘This is what you need to do,’ obviously we’re still the legislature. We still have that power to do what we need to do.”

“But on the other hand, does it completely upend and start everything over again if we don’t do exactly word for word?” Handy continued. “That’s where my uncertainty is right now.”

House Minority Leader Brian Newberry, R-North Smithfield, who is a lawyer, questioned why Taft-Carter ordered the executive branch to negotiate a settlement that needs the legislative branch’s approval.

“The first and most fundamental condition to a successful mediation is that the people with the power to decide the issue and agree to a binding arrangement be in the room and central to the negotiations,” Newberry told Anchor Rising last month. “That is clearly not happening with this ongoing mediation process.”

Nunes recalled that he drafted three possible amendments to the original 2011 pension bill but was told not to introduce them because “we can’t change this – we already had negotiations, we’ve already done due diligence, this is the way it has to be.”

“Don’t come back a year later or two years later and say, no, we had second thoughts, now we’re going to renegotiate this,” he said. “Don’t tell me we can’t change it and then come back two years later and tell us, no, we can’t change it again.”

“This is why we have separation of powers,” Nunes said. “The judiciary cannot force the legislative branch to change a law that was already enacted. Unless it was unconstitutional and has already been ruled, the judiciary cannot force us to change a law. … The judiciary, short of ruling the thing unconstitutional and striking down the entire law, can’t force us to change a law through negotiations.”

Despite his own concerns, Nunes said he expects House Speaker Gordon Fox and Senate President M. Teresa Paiva Weed will be able to cobble together enough votes to win approval of any pension settlement reached by Chafee, Raimondo and the unions. But Fox himself has expressed concerns about reopening the debate.

“If there’s changes, to what degree and and what [do] the variables look like, and what does it do to erode those savings, and who pays the price?” Fox said on WPRI 12′s Newsmakers last month. “If it comes back to the House and the Senate it’s not going to be about, ‘Let’s review what their settlement might be’ – you reopen the whole pension. It’s a law.”

“We’re not at the table negotiating this, nor should we be, but once you reopen the pension, you reopen it all,” he said.

Fox, D-Providence, emphasized that any settlement which comes out of the mediation process would be subject to change by the 113 elected lawmakers.

“Every representative has a right to put an amendment in,” Fox said. “Every representative has a right to demand that we do anything. And how do you stop them without me looking like the imperial speaker who says, ‘All we can vote on is this’? How do you control that? Nor should you control it, because that’s what democracy details.”

“So there’s a lot of anxiety over it, and we’re not part of it,” he said. “There’s a gag order, so I don’t know what terms they’re talking about.” Legislators would need to review the financial impact of the changes, as well, he said, adding that it “is not a simple exercise.”

Other lawmakers said the debate over any proposed settlement would give the General Assembly an opportunity to revisit the pension changes made in 2011, and potentially craft a better law.

“I think those of us who were there when it passed, that immediate feeling of ‘I hope I never have to go through that again’ is the preeminent one,” Rep. Teresa Tanzi, D-Narragansett, told WPRI.com. “But I think the reality is there are some improvements, if there are settlements to be had, that I would like to see included.”

Tanzi said she hoped lawmakers would “look for opportunities to kind of bring those lower-end individuals to be able to receive their COLA [cost-of-living adjustment] benefits earlier than those who were the higher earners,” suggesting pensions worth less than $35,000 annually as a possible cutoff.

At the same time, Tanzi also expressed uncertainty about how much scope there will be for lawmakers to make changes once a settlement is reached. “If this is a negotiated settlement then the two sides have come together, so how much leeway do we really have and how much is justifiable to advocate for beyond that?” she asked.

Rep. Spencer Dickinson, D-South Kingstown, said among his Democratic colleagues at last week’s caucus, “the sentiment was, we’ve dealt with this, we hope we don’t see it again on the floor.” But, he said, “That wouldn’t necessarily be my sentiment.”

Dickinson suggested a compromise could be to adjust the size of pension benefits based on the measured increase in the cost-of-living since the year a retiree stopped working, with a focus on pensions worth up to somewhere between $30,000 and $50,000 a year.

“If you retired in 1990, look at year 2013, see what in 23 years has changed, the value of the dollar in 1990, and get [the same purchasing power] 23 years later in 2013,” he said.

Ted Nesi ( tnesi@wpri.com ) covers politics and the economy for WPRI.com and writes the Nesi’s Notes blog. Follow him on Twitter: @tednesi


Watch Newsmakers: Mike Stenhouse on unions; Joe Fleming

October 13th, 2013 at 1:16 pm by under Nesi's Notes


RI has 2nd-lowest level of government employment in the US

October 7th, 2013 at 9:58 am by under Nesi's Notes, On the Main Site

Here’s more evidence that Rhode Island’s public payroll isn’t quite as large as some people may think.

Rhode Island has the second-fewest government workers among the 50 states as a share of all employees, ahead of only Pennsylvania, according to a recent New York Times analysis of U.S. Labor Department data.

Government workers made up 12.9% of all employees on payrolls in Rhode Island as of August, below the national average of 16%, the Times analysis found. Only Pennsylvania had a smaller share of employees in government, at 12.4%. The share in Massachusetts was 13.2% and in Connecticut it was 14.3%.

The 12.9% figure includes all civilian employees with government jobs at the federal, state or local level. “Whether measured by G.D.P. or jobs, the last several years have been marked by an extraordinary reduction in government in most parts of the country,” The Times’ Floyd Norris wrote.

(more…)


Lawyers brief judge for 8th time on RI pension lawsuit talks

September 30th, 2013 at 11:14 am by under Nesi's Notes, On the Main Site

Lawyers briefed the Rhode Island judge overseeing a union lawsuit challenging the state’s 2011 pension overhaul for an eighth time Monday about the progress of their court-ordered mediation to settle the suit.

Attorneys on both sides of the case met Monday morning at Kent County Superior Court in Warwick with R.I. Superior Court Judge Sarah Taft-Carter, who is handling the suit, court spokesman Craig Berke said. Last December, Taft-Carter ordered the state and the unions into a formal mediation process overseen by the Federal Mediation and Conciliation Service behind closed doors.

The latest update happened amid growing signs that the two sides are getting closer to reaching a settlement.

(more…)


Unions taking steps to prepare for RI pension suit settlement

September 25th, 2013 at 12:51 pm by under Nesi's Notes

By Ted Nesi

PROVIDENCE, R.I. (WPRI) – State and local government unions hope to start spreading the word this fall about a successful settlement to end their lawsuit challenging Rhode Island’s landmark 2011 pension law without a trial, a labor leader has revealed.

“A subcommittee of the plaintiff groups has been formed to begin to discuss member communications with the expectation that a successful conclusion to negotiations, if achieved, will allow us to begin to inform our members,” Roger Boudreau, president of the Rhode Island American Federation of Teachers’ retirees chapter and a member of the state Retirement Board, wrote in a member newsletter.

Read the rest of this story »

• Related: Lawyers brief judge for 7th time on RI pension lawsuit talks (Sept. 5)


Lawyers brief judge for 7th time on RI pension lawsuit talks

September 5th, 2013 at 6:39 pm by under Nesi's Notes, On the Main Site

Lawyers briefed the Rhode Island judge overseeing a union lawsuit challenging the state’s 2011 pension overhaul for a seventh time Thursday about the progress of their court-ordered mediation to settle the suit.

Attorneys on both sides of the case met Thursday afternoon with R.I. Superior Court Judge Sarah Taft-Carter, who is handling the suit, court spokesman Craig Berke said. Last December, Taft-Carter ordered the state and the unions into a formal mediation process overseen by the Federal Mediation and Conciliation Service.

The status conference took place amid growing buzz in State House circles that Gov. Lincoln Chafee and Treasurer Gina Raimondo are moving toward a negotiated settlement of the pension suit, despite concerns expressed by Senate President M. Teresa Paiva Weed about whether a deal is the right move.

“We’re making progress on our pension negotiations, so we can stay out of litigation – expensive litigation – and [not] risk the possibility of losing a court case, which none of us want to do,” Chafee said Wednesday at the news conference where he announced he won’t seek a second term. “We’re making progress there.”

Taft-Carter has scheduled the next status conference for later this month, on Sept. 30 at 9 a.m. The previous six status conferences were held on Aug. 6, May 17, April 22, March 25, Feb. 28 and Feb. 1.

• Related: EngageRI: Why the law is OK (March 18) | Prof: Law may be unconstitutional (Dec. 24)


Chart: Rhode Island’s government work force keeps shrinking

September 4th, 2013 at 12:46 pm by under Nesi's Notes, On the Main Site

Red Jahncke, a Connecticut management consultant, took to the Projo op-ed page on Wednesday to highlight the anemic pace of private-sector job creation in both his home state and Rhode Island.

“Private-sector jobs are the ones that matter, because they generate real economic activity,” Jahncke argues. “More private jobs are always a good thing. More government jobs constitute excess beyond a certain point. We can debate where that point is, but not that the point exists.”

The commentary might lead Jahncke’s readers to think public-sector payrolls in Rhode Island are on a permanent upward trend. But the numbers tell a different story.

Government employment in Rhode Island – the total number of people employed locally by federal, state and local government entities – has fallen to near its lowest level over a quarter-century of record-keeping:

RI_govt_jobs_1990_6-2013_FRED

The picture looks even more dramatic when you take account of the state’s larger population today. This chart shows the number of government employees in Rhode Island per state resident since 1990:

RI_govt_jobs_per_capita_1990_6-2013_FRED

It looks like Rhode Island’s small-government conservatives have won the policy battle in recent years.

• Related: Chart of the midday: RI personnel costs rise as numbers drop (Jan. 17, 2012)


Watch Executive Suite: RI AFL-CIO President George Nee

September 3rd, 2013 at 5:00 am by under Nesi's Notes, On the Main Site


Remembering the fight for Labor Day in 1890s Rhode Island

September 2nd, 2013 at 5:00 am by under Nesi's Notes, On the Main Site

R.I. Central Labor Union newspaper, 1893

In the modern age, many American holidays’ roots have been largely forgotten, becoming more like Britain’s bank holidays than specific celebrations. Labor Day is one of those, which is too bad, since it has a rich local history of its own.

Scott Molloy, a professor at URI’s Schmidt Labor Research Center, retold the story in a 1993 issue of Old Rhode Island magazine:

In the midst of the financial panic of 1893, Rhode Island workers secured a long-sought ambition – the establishment of the first Monday in September as a legal holiday.

The state’s horny-fisted sons and daughters of toil had marched, petitioned, and agitated for over a decade. Rhode Island workers witnessed New York and Oregon pass holiday legislation in 1887, and by the spring of 1893 most other states had followed suit. The General Assembly, under the prodding of elected representatives from various mill towns, finally joined the bandwagon, and Governor Russell Brown signed the authorization.

Read the rest here. I’ll be back tomorrow – have a great Labor Day!

• Watch: RI AFL-CIO President George Nee on Executive Suite (Sept. 1)

(image credit: Quahog.org)

This post was originally published in 2012.


Bills on biweekly pay in RI, letting Victory Day float in limbo

July 1st, 2013 at 12:29 pm by under Nesi's Notes, On the Main Site

The General Assembly has two days left, and a few of business’s long-sought priorities remain in limbo.

A House bill to allow biweekly pay in Rhode Island – the only state in the country that bars it since 2000 – passed on May 23, and was referred to the Senate Labor Committee, which still hasn’t taken it up. The Senate passed its own biweekly pay bill last Wednesday and sent it to the House Labor Committee.

The Senate bill is significantly more stringent and worker-focused than the House legislation, which would let any private employer pay wages every other week so long as they prove to the Department of Labor and Training that they have enough money, using a surety bond or another method.

The Senate, by contrast, would only allow biweekly pay at employers whose average payroll is more than 200% of the state minimum wage – unless they get explicit permission from the DLT by meeting a series of requirements – and would require union employers to get permission from their workers to go biweekly.

(more…)


Raimondo to lawmakers: Don’t skip $12.9M pension deposit

June 20th, 2013 at 5:34 pm by under Nesi's Notes, On the Main Site

Governor Chafee and Democratic legislative leaders have ignored Treasurer Gina Raimondo’s argument that they should make a $12.9 million payment into the state pension system as part of the 2013-14 state budget.

The House Finance Committee voted Tuesday to repeal a provision of state law that requires Rhode Island to put surplus tax revenue into the underfunded pension system for state employees and teachers. By repealing the law as part of the budget, taxpayers can put $12.9 million less toward pensions next year alone.

In a Feb. 6 letter to House Finance Chairman Helio Melo, Raimondo said she opposed ending the requirement that surplus tax revenue goes to the pension fund “because providing retirement security is a top priority for me.” Raimondo’s office said Thursday her position on the issue hasn’t changed.

(more…)


Coventry won’t fund schools’ pension plan, alarming state

May 21st, 2013 at 10:00 pm by under Nesi's Notes

By Ted Nesi and Tim White

COVENTRY, R.I. (WPRI) – Elected officials in Coventry have taken an apparently unprecedented step by washing their hands of responsibility for one of their employee pension plans, saying taxpayers have no obligation to come up with enough money to stop it from running out of cash within 12 years.

The decision about retirement funding for the town’s 349 non-teacher school workers and retirees has shocked members of a state commission tasked with overseeing local pension plans, and they’ve summoned Coventry leaders to a special meeting in Providence next week to defend it.

“There really seems to be a lack of leadership in terms of somebody assuming responsibility,” Rosemary Booth Gallogly, the Chafee administration’s revenue director and chairwoman of the pension commission, told Target 12. She said she’s never heard of a municipal government taking such a position.

“I don’t think they recognize the implications for those employees and recognize that they really do have a duty to their employees and retirees to figure something out,” Gallogly said.

Coventry Town Council President Gary Cote and his four colleagues did not respond to multiple messages from Target 12 requesting an interview about their handling of the pension plans. Democrats took control of the council in the 2010 election.

All told, Coventry’s three local pension plans – one for police, one for municipal employees, and one for non-teacher school personnel – have racked up a $121 million liability for promised benefits, with less than $23 million saved to pay the bill. In fact, just two years ago the newly elected Town Council voted to sweeten police officers’ pension benefits, adding roughly $9 million to the tab in one fell swoop.

Benefit payments set to double

The pension plan for Coventry schools’ support personnel was created in 1977 by the School Committee and the town teachers’ union. It has less than $11 million in assets to cover a $35 million liability and is on track to run out of money to pay retirees by 2025, according to actuarial projections.

The pension plan paid retirees nearly $1.4 million in benefits in 2011-12, and the tab is set to double over the next decade. The School Committee contributed $600,630 to the plan that year, far less than the $2.4 million its actuary said was required. Eligible employees put 8% of their paychecks in, for a total of $364,300 in 2011-12.

A resolution passed by the Town Council in December and supported by the School Committee argues the town is only responsible for depositing a set percentage of money into the pension plan – according to its contract, 12.75% of payroll – and not for depositing the amount required annually to ensure adequate funding of benefits. Most towns try to pay that amount, which is determined by an actuary.

“Looking at the trust documents, this is a defined-benefit plan,” Gallogly said. “They’re treating it as if it were a defined-contribution plan.”

‘We do not have a legal responsibility’

According to Coventry Town Manager Thomas Hoover, however, the legality of the town’s unusual policy was affirmed by attorney Vincent Ragosta Jr., who is an assistant town solicitor.

Full funding for the pension plan “was not promised by the town, and from what the school committee is telling us, they did not promise it,” Hoover said. “Certainly we care about our employees, but we also have to look out for the wellbeing of 35,000-plus citizens.” He said officials will restate their case May 30 during the public meeting with the state pension commission at the R.I. Department of Administration building across from the State House.

As evidence, the council points to a statement in the 1977 document creating the pension plan that says “[n]either the Administrator, the Employer [n]or the Union in any way guarantees the Plan funds from loss or depreciation, [n]or guarantees payment to any person.” They also note that a 2003 collective bargaining agreement altered the language to say the School Committee only “shall provide a contribution to a pension plan.”

Commission members aren’t convinced so far, and they lambasted Coventry officials about the issue at a meeting on April 1. Mark Dingley, a top aide to Treasurer Gina Raimondo who serves on the panel, said the town has a legal responsibility as an employer to address the financial health of the pension plan regardless of the contract language.

Hoover told Target 12: “We totally disagree with that. Our legal counsel has opined on that and indicated that clearly we do not have a legal responsibility for that liability.” He argued the commission is looking at the pension plan “one-dimensionally” by focusing on just the employees and not the taxpayers.

‘The employees be damned, then’

Richard Licht, Chafee’s director of administration and another member of the pension committee, asked a Coventry representative at the meeting: “I just hear, ‘We’re writing a check for 12.75%; see ya later.’ Is that your position?” After hearing the town’s argument, Licht said: “The employees be damned, then.”

Ted Przybyla, the former Scituate treasurer who became Coventry’s finance director in 2010, told the panel he couldn’t discuss the plan. “It is the position of this community that this is not the responsibility of the town of Coventry, and that the plan is the responsibility of the trustees,” he said, referring to a board of two School Committee members and two union representatives charged with overseeing the pension plan.

Gallogly emphasized that having the town take responsibility for the schools’ non-teacher pension plan doesn’t necessarily mean taxpayers will have to cover the whole $35 million unfunded liability. She noted that other Rhode Island communities are negotiating benefit reductions with their workers and retirees to make the payments more manageable.

The pension plan’s trustees already reduced its benefits last September under an August 2011 agreement with the union. Hoover said the Town Council and the School Committee are willing to sit down with the trustees and discuss how to fix it, but the town will not increase its funding above the current level of roughly $600,000 a year.

“We believe we have to follow the contract, just like we believe the employees need to follow the contract,” he said. “We have paid what has been required contractually.”

New council gave union COLA

The issue with school personnel isn’t the only pension problem in Coventry, a rural town of 34,884 whose financial troubles are already in the headlines as one of its local fire districts fights to stay open.

Coventry’s pension plan for police officers is just 11% funded, with less than $8 million saved to cover a $67 million liability. The town contributed $2.3 million to the plan in 2010-11, less than half the money its actuary said was required.

One reason for the police plan’s problems: in January 2011, the new Town Council added $9 million to its unfunded liability by approving a new collective bargaining agreement with the police union that awarded officers hired since 1994 an annual cost-of-living adjustment (COLA) to increase their pension benefits.

The police union’s previous pact explicitly excluded officers hired since 1994 from receiving COLAs, but the language was removed when the council approved the new agreement in 2011, according to documents reviewed by Target 12.

Hoover acknowledged adding the police COLA carried a significant cost and suggested the total amount wasn’t known when the council approved it. He said officials awarded the COLA partly to avoid binding arbitration with the police. “All things considered, I think this settlement was a much better position financially than what we estimated we would come out with in arbitration,” he said.

‘The money was just not there’

Glen Shibley, a Republican who served on the Coventry Town Council before winning a General Assembly seat in 2010, told Target 12 last year that the previous council had been ready to go to arbitration rather than award the COLA.

“I don’t want to point fingers or make accusations, not having the specifics, but I tell you, we just shook our heads on the outside looking in when this current council decided to go ahead and give the police and the other unions COLAs, because we knew the money was just not there – it wouldn’t be there,” Shibley told Target 12.

“You go to arbitration, it’s a gamble, but we were ready to make that gamble knowing the economic situation – not only Rhode Island’s, but the country’s,” he said.

“You could get an arbitrator who could have given more but I think, again, any arbitrator worth his or her salt would realize this coming tidal wave that we find ourselves deep in the mire of,” added Shibley, who was defeated in November by Democrat Leonidas Raptakis.

‘Tantamount to deficit financing’

Coventry’s third local pension plan – for municipal workers – is in somewhat better condition but is only 28% funded, with $4.4 million saved to cover a $15.7 million liability, according to its actuary.

Coventry has 127 current and former officers in the police pension plan, and 211 current and former municipal employees in their pension plan. Other town employees are in the state-run pension system or get 401k-style retirement benefits.

“They’re not in good shape and they’re desperately in need of a remediation plan,” Gallogly said. Failing to stabilize them could make it harder for Coventry to sell bonds, she warned. Hoover said the council has approved plans to change benefits and increase funding that will improve the police and municipal plans.

Analysts from Moody’s Investors Service criticized Coventry’s management of its pension plans last year when they announced they were keeping a negative outlook on the town’s bond rating.

“Moody’s believes that the choice to underfund the [pension contributions] is tantamount to deficit financing and demonstrates an unwillingness to make meaningful progress toward addressing the pension liability in a sustainable fashion,” the analysts wrote in a March 2012 note to investors. “The increased use of this practice is likely to bring negative pressure to the rating.” Moody’s has previously criticized Coventry’s “long history of underfunding.”

Town fears binding arbitration

Even if Coventry resolves its pension funding problems, the town won’t be completely out of the woods. The town also provides full health coverage to some retired employees and their families until age 65, as well as dental coverage until death.

Coventry has accumulated a $12.5 million unfunded liability for retiree benefits and doesn’t set aside money in advance for them, operating on a pay-as-you-go basis, according to its most recent audit.

Hoover said police officers in Coventry don’t receive retiree health benefits, which was another reason the council agreed to give them a COLA to avoid going before an arbitrator.

“If we went to arbitration, I can’t say where I would end up when we do comparisons with other cities and towns,” he said. “We were very concerned about that.”

Ted Nesi ( tnesi@wpri.com ) covers politics and the economy for WPRI.com and writes the Nesi’s Notes blog. Follow him on Twitter: @tednesi

Tim White ( twhite@wpri.com ) is the Target 12 investigative reporter for WPRI 12 and Fox Providence. Follow him on Twitter: @white_tim


EngageRI offers the legal case for the state pension overhaul

March 18th, 2013 at 11:45 am by under Nesi's Notes, On the Main Site

Engage Rhode Island, the deep-pocketed advocacy group closely tied to Treasurer Gina Raimondo, released an unsigned three-page document [pdf] on Monday that makes the case for the legality of the 2011 pension law. Here’s the core of the argument:

If the Rhode Island Supreme Court affirms Judge Taft-Carter’s Decision, it will reverse its own precedent on the unmistakability doctrine, and create new constitutional law which will differ from federal court precedent and the precedent of the majority of state courts in this country. … If the judiciary can require a legislature to bind itself forever through one legislative act, which can never be revisited, the judiciary is thereby given too much power. Thus, it is important to hold from a separation of powers perspective that, unless the legislature’s intent to create contractual rights against the state is unmistakably clear, it should be free to amend its own legislation in the future.

Read the entire PDF here. For an alternative view, check out this from RWU Law’s Michael Yelnosky.

• Related: Mediation to continue in RI pension suit after judge gets update (Feb. 28)