Providence retirees cite hardships in challenge to city pension accord

rhode-island-name-change

PROVIDENCE, R.I. — Testimony in a lawsuit by a group of city retirees challenging the 2013 cuts the city made in police and fire retirement benefits entered its second week Monday, as a dozen former police and firefighters described how the benefit reductions affected their lives.

The retirees recounted how when they retired, they did so assuming that they would be getting annual cost-of-living increases in their pensions and would keep their city health insurance for the rest of their lives.

Retired firefighter Michael DiFazio said when he left in 2011, those two items were major reasons why he went when he did. Now, he testified, he’s making less than expected and his health care costs are higher than planned.

“That wasn’t part of the deal,” he said. “That wasn’t part of the plan.”

The deal it wasn’t part of was the 2013 agreement brokered by then-mayor Angel Taveras, the city’s public safety unions and representatives of the city’s retirees.

The deal saved the city $18.5 million that year and cut the city’s pension liability by $170 million.

It did it by suspending all cost of living increases and moving all retirees over 65 into the federal Medicare program, with the city paying for supplemental insurance to bring coverage up to what it was before.

At the time, more than 80 percent of the city’s 1,357 retired police and firefighters signed off on the agreement, but a dissenting group opted out and sued, asking Superior Court Judge Sarah Taft-Carter to declare the taking illegal and reinstate their cost-of-living increases. The opt-outs paid another price; by not signing up, they don’t get the city-paid supplemental Medicare coverage.

Monday’s testimony by 12 retirees followed a pattern. On direct examination by their lawyer, Kevin Bowen, they’d tell how they’d counted on the pension increase and health coverage in their retirement planning, and the hardship the loss created.

Then one of the city lawyers would cross examine, seeking to undermine the hardship claims, by going over a witness’ tax return, noting a BMW rented, a Mercedes bought or investment accounts with hundred of thousands of dollars.

Retired firefighter G. Scott Pierce testified that he had to retire in 2007, after 27 years, because his right ankle, broken five times, couldn’t stand up to the work anymore.

He said he’d assumed he’d be getting lifetime health insurance and a pension that would increase with age. Now, he said, he was living on a $32,000-a-year disability pension and increasing medical costs. He said his other assets included part ownership in his girlfriend’s house, and $14,000 in retirement accounts.

http://www.providencejournal.com/news/20160411/providence-retirees-cite-hardships-in-challenge-to-city-pension-accord?rssfeed=true