Judge Taft-Carter Dismisses Pension Lawsuits, But Fight To Continue
Russ Moore, GoLocalProv Contributor
Judge Taft-Carter Dismisses Pension Lawsuits, But Fight To Continue
"As of yesterday, it's over," said former Rhode Island Supreme Court Justice Frank Williams, who spearheaded the successful effort to settle the suit between the vast majority of the other litigants and the state earlier this Spring. "But like anything else in our democratic society, it remains to be seen whether this is truly the end," Williams said.
According to Paul Valletta, the President of the Cranston Firefighters Union, the fight is far from over.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLAST"We are going forward," said Valletta.
Valletta said that the ruling was basically a technicality because the litigants were suing over the legislation that was enacted in 2011 that altered the pension system for thousands of Rhode Island retirees and city and state workers. Because the state changed that law this year, and so many other unions signed off the changes and dropped their lawsuits the unions still contesting the new law need to refile their lawsuits.
Where the new lawsuit will be filed, however, remains to be seen, said Valletta.
"We aren't sure yet whether we will file the new lawsuit in state court or in federal court. That's something we need to sit down with our attorneys and decide upon," he said.
Valletta said he and the Cranston chapter of the International Brotherhood of Police Officers have the same attorney and that the police officers plan to refile their court challenge as well. (The IBPO was unable to be reached in time for comment on the issue.)
The ruling marks the latest turn of a nearly 4-year process of challenges to the state's pension reform of 2011, which shaved roughly $4 billion off of the state's pension fund liability by raising retirement ages and moving employees into a hybrid pension/401k system.
Quickly after the legislation was passed by the General Assembly in 2011, the unions and retirees affected by the change sued in state court, arguing that the state had no right to alter what had already been promised to them, and said that it amounted to a de facto contract. Later that year, Judge Taft-Carter gave the unions a marginal victory by ruling that there was an "implied contract" between the two sides due to the legislation that was passed over the years.
The two sides reached a settlement in 2014, but it fell apart after some of the unions rejected the deal. Earlier this year, Williams was appointed a "Special Master" in the case, and quickly achieved another settlement between the two sides, which this time stuck.
Williams said that going forward, if the retirement benefits are to be altered, it needs to be done legislatively.
"My view, as a citizen, as a judge, and as a mediator, is that, and I hope there are, a return to some of the benefits for yesteryear for retirees, they must be done legislatively," said Williams.
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Manager Effective Fee: 0.0%
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Assignment: Private Equity
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Manager Effective Fee: 0.0%
Asset Class: Private Equity
Assignment: Private Equity
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Note: Subject to $10,000 min annual fee
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% of Total Fund: 2.9%
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Manager Effective Fee: 0.25%
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Note: Fee reduced to 0.25% in Q4-2013.
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Manager Effective Fee: 0.30%
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% of Total Fund: 0.1%
Note: Subject to $15,000 min annual fee.
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Assignment: Fund of Funds
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% of Total Fund: 4.2%
Note: The quarterly advisory fee paid to the Investment Manager is 0.1250% (0.50% per annum) of the Fund’s net assets on a quarterly basis when the Fund’s quarterly return is equal to or less than the return on the 90-day US Treasury bills plus 1.25%. The advisory fee will ratably increase, depending on the Fund’s performance, up to a maximum of 0.6250% per quarter (2.50% per annum).
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% of Total Fund: 9.2%
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Manager Effective Fee: 0.74%
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Assignment: Foreign Equity
Market Value: $39,824,387
% of Total Fund: 14.9%
Note: Brandes Partners: 0.95% on first $10m/0.80% on next $10m/0.60% on next $30m/0.50% on remainder.
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Manager Effective Fee: 0.99%
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Assignment: Small Value
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% of Total Fund: 9.7%
Note: Boston Partners-SV: 1% on first $25m/0.80% on remainder.
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Manager Effective Fee: 1.50%
Asset Class: Private Equity
Assignment: Private Equity
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% of Total Fund: 0.4%
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Manager Effective Fee: 3.0%
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