PROVIDENCE, R.I. (AP) — Rhode Island public workers and retirees pushed back against a major public pension overhaul proposal Wednesday, urging lawmakers to slow down their deliberations to ensure any changes are fair.
Philip Keefe, president of the state's second largest public sector union, told lawmakers reviewing the proposal that it treats lower-paid workers as "serfs." Keefe leads the Rhode Island Alliance of Social Service Employees.
"This bill has failed miserably," Keefe said. "Put some breaks on this. I don't think we need to try to fix a 20-year problem in two weeks. It doesn't make any sense to me."
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The legislation from Gov. Lincoln Chafee, an independent, and Treasurer Gina Raimondo, a Democrat, calls for a new system that combines 401(k)-style accounts with traditional pensions. The plan would halt cost-of-living pension increases for most retirees for a projected 19 years and raise retirement ages.
Hundreds of public workers and retirees gathered at the Statehouse to watch as lawmakers continue hearings on the proposal. They planned to hold a protest later in the day, and a business-backed group called EngageRI planned its own rally to support the proposed changes. Chafee was expected to address the second event.
Chafee and Raimondo say the legislation will save billions and protect future retirement benefits. Public unions call the plan unfair and vow to sue if lawmakers adopt it.
The state's pension system faces a $7 billion unfunded liability, nearly as large as the state's overall budget for one year. Taxpayer contributions to the pension system are set to double in upcoming years. Raimondo and Chafee warn that without changes, the costs will ultimately swamp state resources.
Those testifying so far Wednesday disagreed.
William Fornia, an actuary hired by public sector unions, told lawmakers the state's pension problem isn't the crisis Chafee and Raimondo say it is.
"There are plenty of pension systems that are in worse condition than you," Fornia said. "This problem is not unique to Rhode Island… It's a problem, don't get me wrong, but you're not Illinois or New Jersey."
Fornia said the proposed suspension of automatic pension increases is particularly onerous, and that the hybrid pension plan would hurt older workers who don't have time to grow a retirement savings account.
"Every state is doing something like this," he said. "They're not doing anything as harsh."
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