Bloomberg examines the high stakes of the RI pension lawsuit

Michael McDonald reports for Bloomberg News:

While the court action may take months or years, it’s being closely watched as it may provide guidance in other states where similar legal battles have arisen, said Amy Monahan, who teaches law at the University of Minnesota in Minneapolis. Rhode Island is also unusual because, unlike in California, where court rulings have sided with labor to protect benefits, there is little precedent to guide the outcome, she said.

“Other state courts will watch because they’d love to come up with a way to address this area that makes sense,” Monahan said, calling it “a compelling case.”

“Rhode Island has it all: a poorly funded plan and really widespread changes,” she said. …

The law provided “a dramatic punctuation” to efforts by U.S. state and local governments seeking to control retiree costs as pension-plan losses drained assets, said Ronald Snell, a senior fellow at the National Conference of State Legislatures in Denver. …

“[Raimondo] deserves credit along with others,” said David Walker, president of the Comeback America Initiative, a nonprofit public-policy group in Bridgeport, Connecticut. “She had the courage to campaign on the need for pension reform and to make tough choices, even in the face of significant union opposition.”

Read the rest here. The Newsmakers episode that the article references is online here.

• Related: Study: RI pension bill ‘a good approach’ – and it may be legal (Nov. 4)

(photo: Ted Nesi/WPRI)

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