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) or completely incompetent.
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. Slick laws can be passed and councilors don’t read the fine print.
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 (or again, completely incompetent people taken advantage of by the union).
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
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. normally a small % of your salary that you can put in to a retirement saving account and your employer will match it. Whatever is in there is yours at retirement.
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.
UPDATE – I’m told there may be underlying law that requires an initial 6-7% employee contribution and the 1% mentioned above would be in addtion to. Let’s certainly hope so (not that the compound 3% isn’t bad enough) and I’ll let you know as soon as I learn more.
Does anyone else see a train coming?
But as I said, that’s just a taste. And there may be 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 |