James Bedell

Retirees perspective:

This letter is about the effects of the change to the Rhode Island pension system that occurred in 2011.

Picture this interaction.

I drove to Providence to retire from my career as a teacher. After discussing what I would be getting as a retiree, I walked out of the office in Providence feeling great about the inflation protected retirement I had earned after more than 30 years of paying 10% of my gross salary into the pension fund. I was comforted by a sentence in the retirement handbook (p 16), " Public school teachers and state employees receive a 3% compounded COLA the third January following retirement and every January thereafter."

There was nothing ambiguous about the state fulfilling its contract with me including my 3% annual COLA. I no longer worked for the state. I was retired.



Then, after a blitzkrieg media effort by a single Texas anti-union billionaire, my legislators simply voted to not pay me what they owed me. They chose to put my money for my COLA into the general fund for future political purposes.



No business would tolerate, when their bill becomes due at the end of a job, “We have decided not to pay you what we owe you. We are using your money for other things."



Most grievously affected were people who were already retired and would be spending the next 21 years without their COLA. Actuaries have shown that a majority of them will be dead by the time the COLA is reinstated. It is even more disgusting that the death of retired pensioners is freeing up more money to go into the political coffers.



An important fact is we who had retired in the years before the law was changed had taken the job because of that COLA protection for retirement. We were the people who took those jobs when inflation was double digits. In a significant measure we were drawn to the job and we signed up for the job because all around us people were being crushed by the rampant inflation rate. The irony of it all is the exact people who the state recruited to work for them because of the COLA promise are the ones to be most adversely affected. We had not made any plans to weather inflation in our retirement because we had a 3% COLA in our contract.



We who were already retired when the pension law was changed are a unique group. We were not allowed to return to our jobs and we have not been getting the inflation raises the still working people are now getting. We had already made all of our major financial decisions; the houses we could buy, the colleges our kids could go to, etc. We had no way to undo our financial lives that were based on the 3% annual COLA in our contract.



Two other states (Illinois, Oregon) tried to take away the benefits of people who had already retired, but both of those State’s Supreme Courts reversed their legislators and made sure that the contract clause in the Constitution was honored and the already retired people were paid what their contract defined.



The Rhode Island State Supreme Court would not revisit the taking which was perpetrated by the legislators. Because of political maneuvering none of these retirees has had a chance to bring the constitutional contract clause violation to court.



It is a moral and a legal imperative the state of Rhode Island honor its contract to those who retired before the system was changed. Their full 3% COLA should be restored starting immediately.



Jim Bedell *

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