C. Falls slashes dozens of pensions by 55%; one gets cut $41K

city retirees hear about the pension cuts July 19

Central Falls slashed one in three of its retirees’ pension checks by more than half this month, with the majority of the city’s former public-safety workers set to lose tens of thousands of dollars a year.

Receiver Robert Flanders reduced 48 of the city’s 141 police and fire pensions by 50% or more, with all but three of those cut 55% from their original amount, according to financial records obtained by WPRI.com.

Only 27 pensions were left untouched. Eight of those are being paid for from a separate pool of assets, while 19 others were shielded from cuts because they’re worth less than $10,000 a year.

Three of the payouts that lost the most cash were granted in July:

  • Former acting fire chief Gerard Dion’s pension dropped by $41,684 a year, from $75,789 to $34,105;
  • former firefighter Robert Noury’s dropped by $37,628, from $68,414 to $30,786; and
  • former policeman Steven Sullivan’s dropped by $36,493, from $66,351 to $29,858.

The smallest reduction went to Catherine Frechette. Her annual pension dropped from $11,522 to $10,000, a cut of $1,522 or 13%. Michael Long, the lawyer and retired police sergeant who is advising the retirees, saw his annual pension cut by $11,512, from $35,423 to $23,911.

Retirees are receiving their new, lower pension benefits for the first time this month after getting the full amount for a final time in August. Once they learned about the pending cuts, Dion and Noury both said they wished they could have continued working rather than retire, though that didn’t happen.

Central Falls filed for bankruptcy Aug. 1 after too few retirees agreed to voluntarily accept the original sizable pension cuts proposed by Flanders. He imposed the cuts unilaterally after the bankruptcy filing, saying the city did not have enough cash to keep paying full benefits.

Lawyers representing Central Falls’ retirees and workers have until Sept. 17 to file their first round of objections in the bankruptcy case, but for now it appears there is nothing to stop Flanders from only sending out the sharply reduced pension checks. No hearings in the case are scheduled at this time.

While the cuts in Central Falls are eye-popping, officials there argue the reductions are still a better outcome than what transpired in Prichard, Ala., where the pension fund ran out and stopped paying benefits altogether. Flanders has also begun charging the city’s retirees premiums for health insurance coverage for the first time.

Decades of poor record-keeping in Central Falls have made the situation worse. The largest benefit cuts increased from 50% to 55% last month after Flanders’ staff discovered errors in the city’s pension documentation.

Flanders has ordered an audit of Central Falls’ files and will ask retirees to certify that the information on record about them is correct, he said in an Aug. 24 letter. Some pensions could be increased if errors are discovered, but they will not be decreased further if employees correct bad information, Flanders said.

Flanders also broached the possibility that more cuts could be coming down the road. “Please be advised that I reserve the right to make future changes to benefits or to conduct investigations into the appropriateness of such benefits, including disability benefits,” he said in the letter.

Related: Central Falls set to file bankruptcy exit plan delayed by Irene (Sept. 1)

Related: Why Central Falls owes its retirees $80 million in benefits (July 19)

(photo: Ted Nesi/WPRI)

12 thoughts on “C. Falls slashes dozens of pensions by 55%; one gets cut $41K

  1. Finally a city in Rhode Island is paying civil servants the appropriate pension. These public sector employees have been overpaid for too long.

  2. You people should get your numbers straight. There is no way Dion, Noury or Sullivan were making that much for pensions. That was their salary while on active duty and includes overtime. If you are trying to make middle class workers who did their job look bad, at least get your facts straight. Also, overtime was never figured into pension payments, it is figured only on base salary.

  3. Who the heck put these numbers together? There is no way Sullivan was getting a 66K pension. If he was getting that for a regular salary he was lucky. Whoever put these numbers together needs to go back to check the information they got.

  4. Well, they figured it was ok to report this garbage without checking the facts, now let’s see if they will make the truth as up front as the lies were. And they wonder why we don’t trust reporters.

  5. Steve and Chuck, the numbers are dead on accurate. And it is a blessing that Mr Flanders is man enough to make the decisions that he must in this situation. Goes to show that he isn’t worried about an election and being extorted by the union for votes… Haha score one for the good guys (conservatives). Wooop wooop no mas liberals

    • Lucky Louie, obviously you have no idea what you’re talking about. Just like whoever provided this informtion to the news, and the person who published this without checking his or her sources. The pensions they say these guys were making are completely inaccurate, by 50% at least. Trust me you’re wrong. Mr. Flanders has tough decision to make, I agree, but I hope they’re not providing these superly false numbers to the press to mis-inform the public. If you know the numbers are dead on accurate then I hope you can show it, because a pay stub doesn’t lie and that shows the “dead on” accurate numbers. Sorry you have to post an opinion on a half truth you were fed that you were gullible enough to believe. Just another example that simple minded people believe anything they hear on the news and take it for Gospel without doing the research.

  6. Amen, Charlie. Based on those figures, the acting Chief in the lowest paid department in the state would be getting about $120,000 a year. Not even close. You could only accrue 65% of your pay after 30 years of service. Talk about lying to the public.

  7. Sure, punish the men and women who worked for a living, why not cut the free money the dregs of society are receiving through social security disability, etc. “I have ADD I get a check every month”….give me a break, it’s time to cut the freebies to the lazy and useless…

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