Rhode Island Pension Suit Settled, Court Date Cancelled

317px-Flag-map_of_Rhode_Island.svg

The years-long lawsuit against Rhode Island’s 2011 pension changes is nearly settled, as it was announced on Thursday that most retirees and union members had approved the proposal.

The settlement rolls back a handful of the state’s 2011 pension changes, and will cost the state about $32 million annually in pension-related costs.

But Gov. Raimondo, who in previous weeks voiced her eagerness to settle the lawsuit, said the deal was “in the best interest of all Rhode Islanders.”

The settlement will impact 60,000 state workers and retirees, according to the Providence Journal.

What does it mean for their benefits?

ABC explains:

The settlement provides for cost-of-living increases and one-time stipends for retirees.

The cap for calculating the benefits would increase for some retirees, and the calculation would be based on a new formula using both the performance of investments and the Consumer Price Index. Employees would be allowed to retire earlier if they meet set requirements.

More specifically: the settlement gives a one-time, $500 stipend to retirees.

It also ensures that retirees will receive COLAs more frequently; under the old law, COLAs were only permitted once every few years, and only if the pension fund was 80 percent funded.

Not every party approved the settlement. From ABC:

The unions representing municipal police, Cranston police and Cranston fire, which collectively represent about 800 people, did not agree to the terms. Their lawsuits are continuing and will be addressed by the court after the settlement is implemented.

The settlement isn’t a done deal quite yet. Lawmakers now need to approve the terms, as well as a judge.

 

Photo credit: “Flag-map of Rhode Island” by Darwinek – self-made using Image:Flag of Rhode Island.svg and Image:USA Rhode Island location map.svg. Licensed under CC BY-SA 3.0 via Wikimedia Commons

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