A Rhode Island panel, established three years ago to make recommendations to improve the health of local pension plans, finally submitted its proposals to state lawmakers Monday.
The panel submitted 11 recommendations in all, but only a handful had majority support from the panel. From the Providence Journal:
As drafted, the recommendations and ideas from the Locally Administered Pension Plans and OPEB Study Commission range from the practical, such as establishing a permanent board to oversee locally managed pension and retiree health plans, to the proactive, such as requiring actuarial reviews when a new collective bargaining agreement is going to impact pension or “other post-employment benefit” costs.
Both of those recommendations had support from a majority of the commission members as did others, including recommendations that the state require annual reports on local plan investment returns, and that city and town budgets state the “actuarially determined contribution” for local pension plans and also state how much of that contribution a proposed budget will make.
Some of the recommendations that were submitted without majority support from the panel:
There was no consensus, for instance, on whether having a local pension plan that is in “critical status” — or less than 60 percent funded — be one of the factors that can lead to a state takeover of a city or town’s finances.
Nor was there agreement on whether the state should create a voluntary pathway for locally managed pension plans to become part of the state-run Municipal Employees Retirement System. In that case, the commission recommended further study, and it did the same on the question of requiring funding improvement plans for retiree health funds that are in critical status, even though the improvement plans are required for pension funds that are in critical status.
Rhode Island’s 34 local retirement plans are collectively shouldering $2.1 billion of unfunded liabilities.