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Friday, June 1, 2012

Another fight between Linc and Gina

Gina, Chafee Also at Odds on Muni Pension Bills
38 Studios isn’t the only matter of public policy that Gov. Chafee and Treasurer Gina Raimondo disagree about. There’s also the governor’s hotly-debated municipal pension reform proposal that Raimondo has given the cold shoulder to publicly.

While she said much of her work has been behind the scenes, and with municipal finance directors rather than mayors, twice Raimondo dodged the question when I asked her on Friday if she endorsed the governor’s pension proposal. On my third try, she said:

“Here’s what I would say: I certainly endorse the concept of giving municipalities more tools to help them do their work. This particular legislation is making its way through the legislative process, and this is like a legal hornets’ nest. The General Assembly, they are going to have to figure out the legal issues and the language to try and do that.”

Chafee, for his part, wishes Raimondo would have use her pension cred to help his municipal reform efforts this session. In fact, he told me he wanted her to fight harder for them during last year’s special session devoted to pension reform.

“We had a special session, with total focus on pension reform,” he said. “What are we waiting for? It’s time we get some energy behind this important area moving the state forward.”

Legislative leadership didn’t want the municipal reforms in the landmark reform bill last year. Chafee fought for it to be included and Raimondo not so much.

When pressed, she said the it won’t withstand a court challenge.

“Listen, if we could have figured out a constitutional, financially sound way to pass a statute that reformed these independent pension plans last year we would have done it. I wish we could have, I really do but there is no solution like that.”

She added, “We have to respect collective bargaining.”

It’s a fair point, and one that organized labor certainly agrees with. Pat Crowley of the NEA-RI has described the governor’s municipal package as, “Wisconsin heavy, not even Wisconsin light.” The bill would freeze annual raises for communities with underfunded pension plans, lower disability pensions and prevent cities and towns from offering more generous benefits than the state plan.

But details aside, with both municipal and statewide pension reform efforts, inevitable lawsuits will hinge on whether or not a contract has been broken, and if so if a financial catastrophe can be averted by doing so. A ruling last fall said that state workers have an implied contract with the state.

“That was a summary judgment so it remains to be seen,” said Raimondo. “We’ll see where it goes.”
Another theory is that Raimondo doesn’t want to anger municipal unions, which could prove critical if she runs for governor in 2014.

She vehemently ruled out politics playing into her decision not to endorse the governor’s municipal package, saying, “No, of course not. That’s not how I think about it.”

But she wasn’t so adamant when I asked her if she was, in fact, thinking of running for governor.
“Never rule anything out,” she said, “but I’m not thinking about it.”

Meanwhile, the next governor won’t be chosen for another two years and the first lawsuits over pension reform won’t be filed until the July or perhaps January, depending on when the reforms first affect workers and retirees.

But it’s the final few days of the legislative session and Chafee’s municipal aid package, including the municipal pension reform proposal, rests in the hands of the House Finance Committee.

The Committee heard the bills earlier in the session and held them for further study. It would need to vote them out in the coming days in order for them to take effect this year.

Bob Plain is the editor/publisher of Rhode Island's Future. Previously, he's worked as a reporter for several different news organizations both in Rhode Island and across the country.