Web update: City council approves pension reform ordinance

Senior Staff Writer
Friday, April 27, 2012

The Providence City Council unanimously passed an ordinance to reform city pensions. The ordinance will make several changes to city pension plans, including freezing cost-of-living adjustments for all city retirees until the city’s municipal pension plan is 70 percent funded.

The ordinance – called the Providence Pension Protection Plan – will also incorporate five other recommendations from the council’s subcommittee on pension sustainability made last week.

The subcommittee recommended seven measure aimed at reforming the city’s pension system. One of the recommendations – which would require retirees to pay 20 percent of their healthcare co-pays – was removed for legal concerns, WPRI reported.

 All 15 members of the City Council voted to pass the remaining six measures, which include revisions mandating city employees to contribute to the pension system, reduction of pension benefits received for “accidental disability” and a cap for pension benefits at one-and-a-half times the average household incomes in Rhode Island. All together, the measures, will save the city approximately $19 million dollars for the coming fiscal year, according to the subcommittee’s report. They will also reduce the Providence pension plan’s unfunded liability by at least $236 million.

“Ultimately, a vote for the Providence Pension Protection Plan was a vote to support working families, small business owners, taxpayers and dedicated city workers who have sacrificed to save Providence,” Mayor Angel Taveras said in a press release, commending the council for their decision.

After the council holds a second vote on the issue – reported by WPRI to be a formality – the ordinance will then head to Taveras, who has publicly urged the council to pass the plan. The savings from the ordinance have already been incorporated into the $638 million budget that Taveras presented earlier this week.

The Local 1033 union – which represents the greatest collection of city works – has come out in support of this plan, according to WPRI. But the Providence firefighters union has come out fervently against this legislation.

“Tonight really stands out as a teachable moment for the labor unions,” said Paul Doughty, president of the Local 799 firefighters. 

After the firefighters’ union made some concessions with former mayor David Cicilline ’83, Doughty said the firefighters were still willing to make more changes on Taveras’ request. But now, they feel as if the administration has gone behind their backs to push the measures through without proper deliberation and negotiations, he said.

“I’m practically begging the administration to take some time between the first and second vote,” Doughty said.

The changes will not financially affect the city until the next fiscal year – which begins July 1 – but the council is still rushing to push it through, Doughty added.

The firefighters are prepared to take legal action, Doughty said, but “we will take the time to deliberate and pick the best legal strategy to protect our membership.”

Members of the city council were unavailable for comment.


More details to come.