CAPRIO MAKES ABOUT FACE ON PENSION REFORM WITH HYBRID PENSION PLAN PROPOSAL
It has been reported that Frank Caprio, candidate for Rhode Island Governor, has proposed a new form of hybrid pension plan for active state employees. While promoting this plan might appear to be a legitimate state function for the General Treasurer, the timing of Caprio’s proposal, coming just days after the Providence Journal published an op-ed piece by RIGOP Chairman Giovanni D. Cicione exposing Caprio’s past opposition to pension reform and in light of Caprio’s history on this issue, demonstrates that the proposal is nothing more than political posturing and the misuse of his staff’s time to promote his gubernatorial campaign.
“For three and one-half years, General Treasurer Frank Caprio embraced the status quo in Rhode Island’s public employee pension plan,” noted Chairman Cicione. “This transparent attempt to score points as a fiscally responsible candidate for governor is an election year ploy and the General Treasurer is using taxpayer supported staff and resources for political activity. Caprio and the employees of the General Treasurer’s office should be apologizing to Rhode Island taxpayers for the billions of dollars in unfunded pension liability that Caprio has been content to oversee instead of working on his campaign for Governor.”
In announcing this plan, Caprio was quoted as saying, “he first recommended a hybrid system in 2008.” This statement, however, is completely refuted by the facts. For example, the Providence Journal reported in January of 2008 that “Caprio has not yet taken a position on what, if anything, the state should do to lower its annual pension costs or $4.9 billion in unfunded liability for the promises the state made in earlier years to current and future retirees. Instead, he has been ordering up studies.” (ProJo 1/25/08). Speaker of the RI House, William Murphy, appointed Caprio to a pension review panel later that year and he continued to “study” the pension issue throughout 2008 as the panel missed deadline after deadline to issue its report. (ProJo 9/22/08).
As late as March of 2009, the Treasurer’s designee to the pension review panel opposed a proposal to limit annual COLA increases to the first $30,000 of pension benefits, which is similar to the proposal now supported by the Democratic leadership of the General Assembly (Pension Commission Final report, pp. 229-230). As recently discussed in Cicione’s op-ed, Caprio has a long history of collaboration in the under funding of the State pension system and the use of unrealistic projections to hide the true scope of vast unfunded liabilities.
“Now that the political winds have shifted, Caprio wants to portray himself as a fiscal conservative,” continued Cicione, “but taxpayers will remember Frank Caprio’s history as a member of Rhode Island’s Democratic leadership that is responsible for this pension mess and that can no longer be trusted to oversee a defined benefit pension system. Thanks to the irresponsible actions of the General Assembly, including those of Former State Representative and State Senator Frank Caprio, the burden on taxpayers to support the state pension system is far beyond anything that Caprio’s hybrid pension plan could address adequately. Instead, we need to move as many public employees over to a 401k style plan as soon as possible and get this pension mess behind us as quickly as possible,” concluded Chairman Cicione.
Press Release: Rhode Island Republican Party
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