Chafee presents municipal reform bill

GOV. LINCOLN D. CHAFEE introduced a series of bills that give municipalities much of the same power to alter retiree benefits that the state has.
Posted 3/15/12

PROVIDENCE – Gov. Lincoln D. Chafee Thursday unveiled a package of bills aimed to help Rhode Island’s struggling cities and towns that includes legislation allowing communities to suspend cost-of-living pension increases for retirees on independent municipal retirement plans.

The cost of living allowance suspensions are based on the pension reform law passed last fall for state-run retirement plans that was fought aggressively by public employee unions. Chafee tried to include municipal plan COLA suspensions in the state bill, but they were cut by lawmakers who cited concerns over whether they would stand up in court.

Chafee’s new pension bill would allow communities to halt COLAs for plans less than 60 percent funded if they could prove that alternative measures had been tried.

“This legislation will empower municipal officials … to address the structural problems that threaten our cities and towns and hold hostage the very future of our state,” Chafee said in a news release. “Only when we have fixed the structure and workings of state and municipal governments in Rhode Island will we revitalize our economy and create the jobs and opportunities we need.”

In addition to the COLA provisions, Chafee’s bills include provisions that would:

  • Force communities with “overly generous” pension benefits to bring them in line with the state system.

  • Provide special releases from state mandates and binding arbitration for Providence, Pawtucket, Woonsocket and West Warwick.

  • Reduce disability pension benefits for public employees who can do other jobs.

  • Allow cash advances of state municipal aid to struggling communities.

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