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Police contracts and ’stuff’

Ultimate pensions – politicians and police calling each other corrupt – and the AG’s office in the mix.  Grab some popcorn…

Since leaving the school committee and joining the town council I don’t post here as often as I should. I get a lot of contact asking what I’m going to do with this site. Luckily, I’ve been so busy with my day job that I haven’t had time to make any decisions. But lately, the emails have turned more into – “why don’t you write about what’s going on?” and “are you going to ignore this stuff?” referring to the police contract and the lawsuits involving the police department and the related AG memos that are flying around town.  And, quite frankly, you are right. I haven’t been forthcoming with a lot of this information and I should have been. I could use the excuse that I was trying to get my feet under me and I thought I could get more done with honey than vinegar, but that didn’t seem to work and there is too much riding on this to keep quiet and hope for the best.

While there isn’t any penalty to divulging executive session material, I haven’t and don’t see a need right now but I can still talk about what is public knowledge.

I also feel fortunate to have an outsiders view of this stuff. I’m not a local and don’t have any preconceived ideas about the players.  I want to have a few more conversations before I get into details but basically I see a lot of bad actors in a falling house of cards – we have a police department being sued by a former building and zoning town employee and a police officer. The employee also had a case with Westerly PD (and won).  I see a lady who many say is nutty, but apparently she was smart enough to beat the HPD on this deal. And  I see a former town councilor, while not in litigation, seems even more aggressively in the mix than the first three.

I also see a police contract with some of the most generous benefits I have seen in the entire state. But most specifically, a pension program that IMHO could have only been passed by someone in an old boy network (I’ll describe that in a bit).

Plus the internal AG memos recently released that adds concern going back a few years.

As I said, I’ll give more thoughts after a few more conversation but this strikes me as a lot of bad actors all around.  They are all pointing fingers at each other saying the other guy is corrupt – and they might all be right.

I know our solicitor is not going to be happy with this post, but I’m not going to be a council person that walks away sayingI couldn’t do anything about it. If it means Hopkinton gets dragged naked through the streets but at the end of the day all is exposed and in the open and over with, then so be it. I’ve dealt with this ‘percieved’ air of corruption and old boy network in this town for too long. Former town councilors have left the state because of it and I’m not going to be one of those.  This will end one way or the other.

By ‘old boy network’ i don’t mean to suggest a body politic gone bad. The reality is that a relatively few number of bad actors can do a lot of damage – after all, who really has the ability to know what’s going on in all corners.

And I include the contract in the discussion because when you get the picture  of the contract that I am beginning to see you are going to ask yourself, ‘how in the heck did that happen” and the only logical solution that fits all the outlined issues is a ’scratch my back and i’ll scratch yours’ culture that is imploding.

But let me get to the contract and I can deal with that other ’stuff’ soon.

As was reported in the Sun, the council isn’t going to release the contract until after we ratify it – contrary to an expressed desire that towns do otherwise.  What was misleading in the paper was that it was a council  decision. Not true. I asked for and got the council’s endorsement of the 30 day rule back in January but the law didn’t pass and when the time came to actually show the public the contract, Tom Buck made the decision not to. I asked specifically if this would be a council decision and he said it was his alone. I don’t know if Barbara and Sylvia would have supported me or not although Sylvia’s comments suggest she would not have since she said she doesn’t want to be the first (technically, East Providence was teh first). I assume Tom can do that since the attorney was in the conversation when I asked if he had the authority.

I’m doing a very in depth analysis comparing our contract to every other one in the state. Today I just want to get the conversation started and establish some background. Then I will break the current contract down into pieces and make comparisons.

But before you get to that, I do want to review what I consider the most egregious part of the current contract (and how this ever got put  there in the first place will make you say what I suggested above – ‘ only someone on the take would allow this’ – or they were totally unqualified to negotiate the contract.

The pension in place now is a 3% compound COLA (cost of living adjustment) (RI Gen Law 45-21.2-5(9)). What that means is that each year after retirment the amount goes up by 3% and the interest compounds  upon itself- as Einstein said, “compound interest is the most powerful force in the universe.”

Now, a 3% cost of living adjustment is insane for a number of reasons. First of all, we are in a recession and the Consumer Price Index is actually negative. If the intent was to keep pace with the ‘cost of living’ then we would be reducing the amount, not increasing it.

But the compound nature is the insidious part. If a person starts the force at 24 and retires in 20 years (which they are able to do in Hopkinton) they will be 44 years old. If they retired with a $75,000 per year pension at age 44 (which isn’t that hard considering we include longevity and holiday pay with the ‘income’ for pension determination) by the time they reach the normal life span of 78 years old we will be paying them $198,925 per year. I am not kidding.

But that’s not the worst part of Hopkintons pension program. The worst part is how it is paid.

You may have heardthat as much as 1 in 5 private companies have stopped making matching payments to 401 K’s. THey just don’t have the money – the economy is tanking (because government- read public sector employees like police – are taking too much in taxes) and private companies can’t just raise the price of goods because competition maintains the market. So they have to cut where they can.

Normally a company will offer a 1 to 1 match up to a certain percentage. They won’t let you put in 100% of your income – its normally 7-9% of your salary that you can put in and they will match it.

But in Hopkinton, the police are only required to contribute 1% of their salary. Yup, you read correctly – 1 percent (RI Gen Law 45-21-52). [note the law does not say it is ‘compound’ – thats why they had to pass a new law linked above - I’m still doing the research but it looks like that couldn’t be done without legislative support so I will see who is responsible and let you know).

But I digress – so, the police employee contributes 1 percent of their salary to get the most lucritive pension available – Does that mean Hopkinton contributes 1% too?

  NO!   The town has to put in much more than 1%. We must come up with the  balance needed to meet the defined benefit.

We are currently contributing 18%.  Read that again – it is a 1 to 18 match for the most generous pension package I have ever seen (and I study these things for a living). But thats nothing – that 18 percent just pays the employee who is collecting now – who recently retired. Wait until the compound interst adds up and their pension doubles and then triples Our contribution will have to double and triple.

Does anyone else see a train coming?

But as I said, that’s just a taste. And there are some irregularities with the way the pension was created that I’m looking into – I will provide more details on all levels of the contract with statewide comparissons soon. And more comments on what is the hot topic in town – the Matson/Mauti/Scunzio/??? peyton play.

PS. In the last meeting I also asked about the 550 hours of comp time Chief Scunzio has compiled. I was surprised that much could be accumulated but I was told that it will be paid by the confiscated drug money – like this matters. If we didn’t use the money to pay for comp time for the CEO of the organization (you know, like other CEO’s get comp time) we could have used the money for sand and salt so we didn’t have to raise your taxes. She missed my point but it did show what the mindset of was- defend and divert! 

PSS. I was pulled over on HWY 95 yesterday by a Providence Police Officer and State Cop (I haven’t been pulled over in 20 years) – luckily I had a witness in the car with me.  But I certainly don’t fear not having one with me – it is just nice to have witness to what was said.  You can find me on 95 north every weekday at 8ish.

For now, please see pasted below a list of towns compared on incomes – i sorted it on per capita. It will establish a good baseline to see where our expenses should line up compared to our income.  After all, if you are middle class, you don’t buy a Ferrari do you?

 Now lets look at the financial demographics of our lovely little village…

Rank	Place	Per Capita	Median House-	Median Family	Population	Number of
		Income	hold Income	Income		Households
1	Jamestown	$38,664	$63,073	$77,990	5,622	2,359
2	East Greenwich	$38,593	$70,063	$90,221	12,948	4,960
3	Barrington	$35,881	$74,591	$84,657	16,819	6,011
4	Little Compton	$32,513	$55,368	$62,750	3,593	1,475
5	New Shoreham	$29,188	$44,779	$59,844	1,010	472
6	Narragansett	$28,194	$50,363	$67,571	16,361	6,846
7	Portsmouth	$28,161	$58,835	$68,577	17,149	6,758
8	North Kingstown	$28,139	$60,027	$69,559	26,326	10,154
9	Scituate	$28,092	$60,788	$67,593	10,324	3,780
10	Lincoln	$26,779	$47,815	$61,257	20,898	8,243
11	Middletown	$25,857	$51,075	$57,322	17,334	6,993
12	West Greenwich	$25,750	$65,725	$71,332	5,085	1,749
13	Charlestown	$25,642	$51,491	$56,866	7,859	3,178
14	Cumberland	$25,592	$54,656	$63,194	31,840	12,198
15	Exeter	$25,530	$64,452	$74,157	6,045	2,085
16	Newport	$25,441	$40,669	$54,116	26,475	11,566
17	North Smithfield	$25,031	$58,602	$67,331	10,618	3,954
18	Westerly	$24,092	$44,613	$53,165	22,966	9,402
19	Hopkinton	$23,835	$52,181	$59,143	7,836	2,965
20	South Kingstown	$23,827	$56,325	$67,912	27,921	9,268
21	Warwick	$23,410	$46,483	$56,225	85,808	35,517
22	Smithfield	$23,224	$55,621	$66,320	20,613	7,194
23	Glocester	$22,914	$57,537	$62,679	9,948	3,559
24	Tiverton	$22,866	$49,977	$58,917	15,260	6,077
25	Warren	$22,448	$41,285	$52,824	11,360	4,708
26	Richmond	$22,351	$59,840	$64,688	7,222	2,537
27	Foster	$22,148	$59,673	$63,657	4,274	1,535
28	Coventry	$22,091	$51,987	$60,315	33,668	12,596
29	Cranston	$21,978	$44,108	$55,241	79,269	30,954
30	Bristol	$21,532	$43,689	$54,656	22,469	8,314
31	Johnston	$21,440	$43,514	$54,837	28,195	11,197
32	Burrillville	$21,096	$52,587	$58,979	15,796	5,559
33	West Warwick	$20,250	$39,505	$47,674	29,581	12,498
34	East Providence	$19,527	$39,108	$48,463	48,688	20,530
35	Pawtucket	$17,008	$31,775	$39,038	72,958	30,047
36	Woonsocket	$16,223	$30,819	$38,353	43,224	17,750
37	Providence	$15,525	$26,867	$32,058	173,618	62,389
38	North Providence	$13,489	$19,721	$31,655	32,411	14,351
39	Central Falls	$10,825	$22,628	$26,844	18,928	6,696

Perpetually unconstitutional

Those of you following S713 and H5762 (the bill to allow never-ending teacher contracts) will be interested in the following OpEd in the ProJo and accompanying policy brief. Printable pdf and word versions of the policy brief are available on the OSPRI website (follow the link for policy brief above).

Legislature assaults local democracy

 

01:00 AM EDT on Saturday, June 27, 2009

 

  

It is a foundational tenet of the American political system that a sitting legislature cannot bind a future legislature. This concept is the very basis of our electoral system. Elections would have little meaning if the actions of former legislators could not be dislodged by their successors.

The Rhode Island Supreme Court has articulated this common-law principle as meaning: “any contract made by a governmental authority involving the performance of a governmental function that extends beyond the unexpired terms of the governmental officials executing the contract is void because such an agreement improperly ties the hands of subsequent officials.”

How does this limit come into play with teacher contracts, which represent the single largest expenditure for cities and towns as they balance their budgets in the wake of cuts in local aid?

The legislature itself has recognized the role of local elections in the shaping of teacher contracts and has specifically limited their term by statute to three years. Even this policy might be subject to constitutional challenge, in cases in which school committees are elected for two-year terms.

Our legislature has recently proposed to make public teacher contracts perpetual. This is suspect from the perspective of both constitutional law and policy.

Unfortunately, very few lawmakers see the danger of this approach. Continuing the terms of an existing contract until it is replaced by a new contract, they believe, simply confirms a longstanding custom which insures continuity of service. In practice, however, such a device turns public labor contracts into perpetual one-way ratchets. Salaries and benefits can go up, but they can never go down.

The last three generations of Americans, including Rhode Islanders, were blessed in experiencing a growing economy (and productivity) that, at its weakest, did not create a sustained downward pressure on wages. It was a time when the battle cry of public-sector unions was to maintain parity with opportunities in the private sector.

It should raise some suspicion that the sudden rush to enact a statute locking the terms of old contracts in place comes when the private sector is, for the first time in recent memory, experiencing reductions in wages and benefits. Suddenly the argument for parity with the private sector has gone silent. The new paradigm being pushed is that public employees should always be entitled to at least the status quo.

And there is no mistaking the specific context of this legislative effort. These bills were filed shortly after the East Providence School Committee, between an economic rock and hard place, determined it would not continue the provisions of its expired contract and unilaterally cut pay and instituted a health insurance contribution as a deficit-reduction measure.

There is precedent for this action in labor law, but it is not an outcome we have been used to seeing in Rhode Island. Often, by mutual agreement, contracts made in previous elective cycles have been continued during an impasse in negotiations with newly elected officials. But mandating this outcome is quite different than sitting officials’ agreeing to it.

The cities and towns are the laboratories of democracy in Rhode Island.

To undercut the prerogatives of local elected officials in the name of maintaining friendly labor negotiations is to violate the very purpose of our electoral system. School budgets represent the vast majority of local spending, and teachers’ salaries the lion’s share of those budgets. Altering local officials’ ability to control those costs relegates local elections to doing little more than changing the names on town welcome signs.

By the same token that current school committees cannot be bound by the actions of their predecessors, the legislature is not bound by its own decision that three years is a proper teacher contract horizon. It seems certain, though, that adopting perpetual contracts, even in the name of smoothing labor disputes and improving government functioning, is constitutionally prohibited.

Perhaps one could make the case that it is the constitutional rule that is inappropriate, but that would require demonstrating that previous experiments at perpetual contracts have been effective and harmonious.

The firefighters in Providence have shown what to expect. The legislature enacted binding arbitration for these public-safety workers. Thus, their contract is effectively continuous and its terms will be decided through arbitration if the parties cannot agree within 30 days of commencing negotiation.

This may come as a surprise to those familiar with the signs that have adorned public streets near Providence firehouses complaining how many days the firefighters have worked without a contract. What those signs actually count is the number of days Mayor Cicilline has refused to accede to the wishes of the fire fighters for a generous contract without arbitration.

The delay in the arbitration process lets the firefighters claim they don’t have a contract, even when the history of arbitration shows they will be quite reasonably treated by the outcome and are working under mutual legal obligation with the city. If their behavior at the U.S. Mayors’ Conference is the “labor peace” that is being bought with perpetual contracts, it might be time to reconsider whether that tree is really bearing fruit.

It goes without saying that, absent serious economic justification, any school committee or council that effectively locked out its teachers would face serious political consequences. That may well be why the last 50 years hasn’t produced a handful of such events, while every year we are treated to the news of teacher strikes.

The teachers shouldn’t be blamed for aggressively standing their ground. Rather, the blame falls on politicians who refuse to fight fire with fire —and worse, on state legislators who now seem poised, absent a public outcry, to tip the scales even more in favor of the teachers unions.

Brian Bishop directs the Founders Project at the Ocean State Policy Research Institute, studying the application to public policy of foundational principles of the U.S. and Rhode Island constitutions. (Susan Carcieri, the governor’s wife, is a member of the Board of Directors of OSPRI but does not review or approve publication submissions.)

 

 

Good for your Constitution – notes from the Founders Project
A Policy Brief from the Ocean State Policy Research Institute
June 26, 2009
Perpetual Contracts push Constitutional Envelope

 

 

It is a foundational tenet of the American political system that a sitting legislature cannot bind a future legislature. This concept is the very basis of our electoral system. Elections would have little meaning if the actions of former legislators could not be dislodged by their successors.

The RI Supreme Court has articulated this common-law principle as meaning: “any contract made by a governmental authority involving the performance of a governmental function that extends beyond the unexpired terms of the governmental officials executing the contract is void because such an agreement improperly ties the hands of subsequent officials.”1

As is often the case, one needs to refer to another case on how this limitation on “governmental function” applies to running public schools. The Supreme Court subsequently said unequivocally: “It is our opinion that the operation and the maintenance of a public school is a governmental function and not a proprietary one.”2

In “proprietary” areas, political actors can contract for periods normal to similar private transactions without regard to elective terms. Proprietary functions, according to the court, are those: “not so intertwined with governing that the government is obligated to perform it only by its own agents or employees”.3

Ironically, the Ocean State Policy Research Institute has argued forcefully that public education ought to be viewed more as a proprietary function — not so fully dependent upon government run schools or so fully funded by government resources. To date, we have not prevailed in making this case and absent such a clear change in public policy the Court has definitively limited contracts with public school teachers.

In apparent recognition of this paradigm, the legislature has limited teacher contracts to 3 years. But this year, they have proposed making public teacher contracts perpetual.
Of course the same principle at issue here means that the present legislature is not bound by the previous legislative determination that 3 years is a proper contract horizon.

Although this proposed legislation seems to confirm the custom of keeping the old contract in force while negotiating a new one, such an enactment would be constitutionally suspect.

Often, by mutual agreement, contracts made in previous elective cycles have been continued during an impasse in negotiations with newly elected officials. But mandating this outcome is quite different than sitting school committee members endorsing it.

The cities and towns are the laboratories of democracy in Rhode Island. School budgets represent the vast majority of local spending, and teachers’ salaries the lion’s share of those budgets. Altering local officials’ ability to control those costs relegates local elections to doing little more than changing the names on town welcome signs.

It seems certain that adopting perpetual contracts, even in the name of smoothing labor disputes and improving government functioning, is constitutionally prohibited.
________________
1 R.I. Student Loan Auth. v. Nels, Inc., 550 A.2d 624, 626
2 Chakuroff v. Boyle, 667 A. 2d 1256, 1258
3 Lepore v. Rhode Island Public Transit Auth., 524 A.2d 574, 575

Brian Bishop directs the Founders Project at the Ocean State Policy Research Institute, studying the application of the constitutional principles of the United States and Rhode Island to public policy.

Working to increase contract understanding

Sylvia makes the best point towards the end of the article (emphasis added) -

From the Westerly Sun:

Union contracts up for vote next week

Hopkinton councilors weigh pacts with police, department heads and clerical workers.

By VICTORIA GOFF / Sun Staff Writer

HOPKINTON — The Town Council is expected to consider approving contracts for three unions next week after the existing pacts expire tomorrow.

The council will likely vote on the pacts for the unions — police, clerical and “professional and technical” (department heads) — on July 6, said former Town Manager William A. DiLibero and Council President Thomas E. Buck, who have been in private talks with the unions.

The police union has approved its contract. The council has not yet seen final versions of the other two contracts, and it is awaiting approval by the unions, said DiLibero, whose last day as town manager was Friday.

The council has not publicly offered details on what is contained in the new pacts, despite earlier this year supporting a bill that would have required municipalities and school districts to release a proposed contract and an accompanying fiscal impact statement 30 days before ratifying it.

The proposal to release the contracts prior to ratification was part of the governor’s budget-repair plan to close a multi-million dollar state deficit by June 30. It was later eliminated from the plan passed by state lawmakers.

In January, the council passed 4-1 a resolution that said the bill, along with three other measures proposed by the governor, would “improve the management and operations of the Chariho regional school system.” The council also supported other proposals included in the governor’s plan, saying they would lower municipal costs.

Councilor Beverly P. Kenney was the sole dissenter.

But since that vote, two councilors have changed their minds.

“I’m going to recant my vote on that,” Buck said Thursday. “That was one that was added to [the resolution] at the last minute. I didn’t have chance to review it.”

Asked why he doesn’t support releasing a contract to the public for review before it is ratified, Buck said, “It’s not the right way to do it. I was elected by the townspeople to negotiate their contracts.”

“Too many things come up, too many issues come up,” he said. “Too many things change in contract negotiations. As you get down the road, you trade off something for something else.”

Buck cut short the phone interview with The Sun Thursday because he said he was on another phone line with someone else. He did not respond to messages left at his home Friday and Saturday.

Councilor Sylvia K. Thompson had first suggested that the council endorse releasing contracts early, but recently said she no longer supports the measure.

As a member of the public, she said she would think: “You’re all done [with negotiations], you’re not going to do anything, so what good is that?”

“I could see where it could just irritate the taxpayer because what are you doing this for and shouldn’t you have done it before?” she added.

Instead, Thompson said she would support meeting with the public before negotiations start, like Chariho Regional School District officials did in December before they started talks with the teacher’s union. The council would give an overview of the current contract and its fiscal impact, she said, and then it would ask the public for its opinion on a new contract.

After a contract is ratified, she said the council should explain its “ins and outs” and financial effects.

Councilor William J. Felkner, an advocate for open contract negotiations, said he hopes that is an action the council will take.

“It’s the people’s money,” he said. “We’re spending their money. I think they should know what deal we just signed them up for the next three years.”

Councilor Barbara A. Capalbo said, “I don’t think that the majority of the people care about the intricacies [of a contract], but I do think that in general terms it must be discussed.” General terms, she said, would be “salaries, benefits.”

Capalbo said contract talks should occur privately “so people can be as clear and forthright as they want to be,” but noted she would support releasing a contract to the public once it is “clear” with the negotiating parties before ratification.

“We obviously can’t change everything at one time but I think it is good for the public to be aware of the changes in the contract,” she said.

Kenney said contract talks should always take place privately.

“I believe contract negotiations are a give and take, and working to get the best deal for the town is easier to do when it is in closed session,” she said.

But Thompson said she hopes state lawmakers would eventually pass a law to require contract talks to be held publicly to benefit municipalities, as she says unions currently have an advantage.

“They’re the ones that fundraise and many of them have a huge war chest in the bank for arbitration,” she said.

Another potential benefit, Thompson noted: “More people in town would be interested and take an active role in what these contracts really mean.”

While Thompson supports open negotiations, she doesn’t want to be the first community to lead the charge, if state law does not mandate public talks.

“It comes to picking your battles,” she said.

Rubber Rooms

You’ve heard me mention them before – “Rubber Rooms” – those are the places they put teachers who, for one reason or another, are still employed by the school system but don’t actually do anything.

Hundreds of New York City public school teachers accused of offenses ranging from insubordination to sexual misconduct are being paid their full salaries to sit around all day playing Scrabble, surfing the Internet or just staring at the wall, if that’s what they want to do.

Because their union contract makes it extremely difficult to fire them, the teachers have been banished by the school system to its “rubber rooms” — off-campus office space where they wait months, even years, for their disciplinary hearings.

Follow link above for the entire article – it came out today.

Going on DePetro in 5 min. 630 AM – 97.9 FM – Does Labor run RI?

Does Labor run RI? I hope you had a chance to see Newsmakers this morning. It continues on DePetro tomorrow morning @ 8:00 – 630 AM 97.9 FM

Is this a way around the voters?

One of the many projects being developed over at OSPRI is a website containing all the stimulus projects being proposed in RI. It is designed to let taxpayers comment and vote on the merits of the project.

It’s not ready to unveil, but the data is up and I noted the Charhio projects.

You can see the sneak peek here -http://ocean.peteresnyder.com/

You’re welcome to play around with it, but if you click on the left link, “Browse by Submitter” and hit Charhio

There you will  see the $4.4m to build the RYSE school. Which makes me think…

Section 9.5 of the Chariho Act says,

(5)  No action shall be taken with respect to the purchase of land, the construction of buildings and the extension of the scope of functions of the regional school district except upon a majority vote of  voters of the respective member towns as set forth in section 1 hereof.

Will Chariho go to the voters before building the school? What’s the odds that Jon Anderson provides an opinion that states the Act doesn’t apply to federal funds?

Budget news

ProJo has the budget info -

The legislature’s budget plan cuts $55 million in general revenue sharing from cities and towns, a reduction that eliminates the general revenue sharing program.

Isn’t the general revenue sharing program where Charho said we would be getting that 54% reinbursement for the bond? Will they move forward and expect the taxpayers to pay 54% more?

On education, the budget for the coming year largely funds local education at the current level. But it eliminates all state dollars devoted to professional development at local schools, approximately $6.3 million. And the plan also cuts $1.7 million in new money the governor had proposed for charter schools and “mayoral academies.”

Disappointing indeed. I guess the special interest groups (like the NEA) doesn’t put the kids first. Well, not if its to their competition.

One sided debates

Speaking of government controlling the debate – have you heard that the Obama Administration has worked a deal with ABC to “debate” the healthcare issue on prime time TV?  Does anyone think it will be an open debate – probably not since they openly admit that they will ”exclude opposing voices on the debate.”

This elicited a response from Ken McKay at the Republican National Committee. Some of you may know that former Carcieri chief of staff, Ken McKay, is now the chief of staff for the RNC.  So, this story has a homey feel.

On a related note, I had the opportunity to sit next to Katie Couric’s boss on a flight back from LA recently. He admitted the network rating are dropping since her coming on board, and admitted that she had a bias, but said, ”doesn’t everyone.”

I’m glad I don’t own any stock in that company. Don’t be surprised if they get a stimulus check if they continue to fail.