Skip to main content
MENU
Subscribe
  • Subscribe
  • Account
  • LOGIN
  • Topics
    • Alternatives
    • Consultants
    • Coronavirus
    • Courts
    • Defined Contribution
    • ESG
    • ETFs
    • Hedge Funds
    • Industry Voices
    • Investing
    • Money Management
    • Opinion
    • Partner Content
    • Pension Funds
    • Private Equity
    • Real Estate
    • Russia-Ukraine War
    • SECURE Act 2.0
    • Special Reports
    • White Papers
  • Rankings & Awards
    • 1,000 Largest Retirement Plans
    • Top-Performing Managers
    • Largest Money Managers
    • DC Money Managers
    • DC Record Keepers
    • Largest Hedge Fund Managers
    • World's Largest Retirement Funds
    • Best Places to Work in Money Management
    • Excellence & Innovation Awards
    • Eddy Awards
  • ETFs
    • Latest ETF News
    • Fund Screener
    • Education Center
    • Equities
    • Fixed Income
    • Commodities
    • Actively Managed
    • Alternatives
    • ESG Rated
  • ESG
    • Latest ESG News
    • The Institutional Investor’s Guide to ESG Investing
    • Climate Change: The Inescapable Opportunity
    • Impact Investing
    • 2022 ESG Investing Conference
    • ESG Rated ETFs
  • Defined Contribution
    • Latest DC News
    • DC Money Manager Rankings
    • DC Record Keeper Rankings
    • Innovations in DC
    • Trends in DC: Focus on Retirement Income
    • 2022 Defined Contribution East Conference
    • 2022 DC Investment Lineup Conference
  • Searches & Hires
    • Latest Searches & Hires News
    • Searches & Hires Database
    • RFPs
  • Performance Data
    • P&I Research Center
    • Earnings Tracker
    • Endowment Returns Tracker
    • Corporate Pension Contribution Tracker
    • Pension Fund Returns Tracker
    • Pension Risk Transfer Database
    • Future of Investments Research Series
    • Charts & Infographics
    • Polls
  • Careers
  • Events
    • View All Conferences
    • View All Webinars
    • 2022 Innovation Investing Conference
    • 2022 Defined Contribution East Conference
    • 2022 ESG Investing Conference
    • 2022 DC Investment Lineup Conference
    • 2022 Alternatives Investing Conference
Breadcrumb
  1. Home
  2. COURTS
June 10, 2019 01:00 AM

Rhode Island city's COLA freezes upheld by state Supreme Court

Hazel Bradford
  • Tweet
  • Share
  • Share
  • Email
  • More
    Reprints Print

    Freezes to cost-of-living adjustments imposed on some retired police officers and firefighters by the city of Cranston were upheld by Rhode Island's Supreme Court.

    The opinion, written on June 3 by Chief Justice Paul Suttell in Providence, upholds a 2015 state Superior Court ruling that the city's financial crisis warranted freezing the COLA adjustments to their retirement benefits, despite contractual rights to those benefits.

    In 2013, the Cranston City Council enacted a 10-year freeze on COLA adjustments for employees of the Cranston Police and Fire departments, which Cranston Mayor Allan Fung said was necessary to prevent the $70.6 million Cranston City Police and Fire Department Pension Plan from becoming insolvent. A lawsuit by police and fire retirees challenging the freeze led to a settlement agreement to freeze COLAs every other year for the first 10 years, and then cap them for another 20 years.

    That settlement was challenged by 70 retirees who opted out of the settlement and formed the Cranston Police Retirees Action Committee to sue the city, the mayor and the city council, arguing that the freezes were a breach of contract and that the city had a history of underfunding the pension fund, among other claims.

    After losing the initial round, the plaintiffs appealed, challenging several of the trial judge's pretrial decisions, some findings and conclusions after trial, and the post-trial award of costs in favor of the city. A key argument in their appeal was that the 2013 ordinances violated the contract clause of the U.S. and Rhode Island constitutions.

    The state Superior Court affirmed the judgment in favor of the defendants on all counts and denied the plaintiff's motion for a stay.

    Calling it an "extremely close" case, Mr. Suttell upheld the Superior Court decision "with a decided lack of enthusiasm and only after prolonged research and reflection and hesitation," he said in an order that noted the lower court's "impressively Herculean effort to summarize the complex factual background that the case involves."

    Mr. Suttell said that relevant precedent compelled him to concur because of the city's unanticipated fiscal crisis and because the COLA impairment is temporally limited. "In my heart of hearts, I think that we, as a nation and as a state, have strayed far from what the Contracts Clauses were clearly meant to prohibit, i.e., any law impairing the obligation of contracts," he wrote.

    Mr. Fung called the decision historic, making Cranston "the first government entity in Rhode Island to reform its troubled pension system while withstanding a full legal challenge."

    The "narrowly tailored" reforms will save taxpayers more than $6 million annually and ensure the long-term solvency of the police and fire pension plan, Mr. Fung said in a statement. "As mayor, I have ensured that we fully funded our (annual required contribution) and 100% of our (other postemployment benefits) obligations so that we are doing right by our workers," he said.

    Related Articles
    Strapped state funds take scalpel to COLAs for relief
    Arizona Supreme Court strikes down 2011 pension reform law contribution hike
    Ohio School Employees sued by union over COLA freeze
    Ohio Teachers sued over COLA changes
    Recommended for You
    ONLINE_190109864_AR_0_SLHVICTSVYPI.jpg
    Former Molina Healthcare employees sue NFP Retirement alleging ERISA violations
    SEClogobig-main.jpg
    Appeals court rules against SEC on administrative law judge proceeding
    ONLINE_180709926_AR_0_SPVGDZVTUNPE.jpg
    Barnabas Health settles ERISA complaint for $1.75 million
    Alternatives: Investing Across the Spectrum
    Sponsored Content: Alternatives: Investing Across the Spectrum

    Reader Poll

    May 23, 2022
    SEE MORE POLLS >
    Sponsored
    White Papers
    Crossroads: Politics, Inflation, & Bonds
    Credit Indices: Closing the Fixed Income Evolutionary Gap
    Forever in Style: Benchmarking with the Morningstar® Broad Style Indexes℠
    Q2 2022 Credit Outlook: Carry On
    Leverage does not equal risk
    Is there a mid-cap gap in your DC plan?
    View More
    Sponsored Content
    Partner Content
    The Industrialization of ESG Investment
    For institutional investors, ETFs can make meeting liquidity needs easier
    Gold: the most effective commodity investment
    2021 Investment Outlook | Investing Beyond the Pandemic: A Reset for Portfolios
    Ten ways retirement plan professionals add value to plan sponsors
    Gold: an efficient hedge
    View More
    E-MAIL NEWSLETTERS

    Sign up and get the best of News delivered straight to your email inbox, free of charge. Choose your news – we will deliver.

    Subscribe Today
    May 23, 2022 page one

    Get access to the news, research and analysis of events affecting the retirement and institutional money management businesses from a worldwide network of reporters and editors.

    Subscribe
    Connect With Us
    • RSS
    • Twitter
    • Facebook
    • LinkedIn

    Our Mission

    To consistently deliver news, research and analysis to the executives who manage the flow of funds in the institutional investment market.

    About Us

    Main Office
    685 Third Avenue
    Tenth Floor
    New York, NY 10017-4036

    Chicago Office
    130 E. Randolph St.
    Suite 3200
    Chicago, IL 60601

    Contact Us

    Careers at Crain

    About Pensions & Investments

     

    Advertising
    • Media Kit
    • P&I Content Solutions
    • P&I Careers | Post a Job
    • Reprints & Permissions
    Resources
    • Subscribe
    • Newsletters
    • FAQ
    • P&I Research Center
    • Site map
    • Staff Directory
    Legal
    • Privacy Policy
    • Terms and Conditions
    • Privacy Request
    Pensions & Investments
    Copyright © 1996-2022. Crain Communications, Inc. All Rights Reserved.
    • Topics
      • Alternatives
      • Consultants
      • Coronavirus
      • Courts
      • Defined Contribution
      • ESG
      • ETFs
      • Hedge Funds
      • Industry Voices
      • Investing
      • Money Management
      • Opinion
      • Partner Content
      • Pension Funds
      • Private Equity
      • Real Estate
      • Russia-Ukraine War
      • SECURE Act 2.0
      • Special Reports
      • White Papers
    • Rankings & Awards
      • 1,000 Largest Retirement Plans
      • Top-Performing Managers
      • Largest Money Managers
      • DC Money Managers
      • DC Record Keepers
      • Largest Hedge Fund Managers
      • World's Largest Retirement Funds
      • Best Places to Work in Money Management
      • Excellence & Innovation Awards
      • Eddy Awards
    • ETFs
      • Latest ETF News
      • Fund Screener
      • Education Center
      • Equities
      • Fixed Income
      • Commodities
      • Actively Managed
      • Alternatives
      • ESG Rated
    • ESG
      • Latest ESG News
      • The Institutional Investor’s Guide to ESG Investing
      • Climate Change: The Inescapable Opportunity
      • Impact Investing
      • 2022 ESG Investing Conference
      • ESG Rated ETFs
    • Defined Contribution
      • Latest DC News
      • DC Money Manager Rankings
      • DC Record Keeper Rankings
      • Innovations in DC
      • Trends in DC: Focus on Retirement Income
      • 2022 Defined Contribution East Conference
      • 2022 DC Investment Lineup Conference
    • Searches & Hires
      • Latest Searches & Hires News
      • Searches & Hires Database
      • RFPs
    • Performance Data
      • P&I Research Center
      • Earnings Tracker
      • Endowment Returns Tracker
      • Corporate Pension Contribution Tracker
      • Pension Fund Returns Tracker
      • Pension Risk Transfer Database
      • Future of Investments Research Series
      • Charts & Infographics
      • Polls
    • Careers
    • Events
      • View All Conferences
      • View All Webinars
      • 2022 Innovation Investing Conference
      • 2022 Defined Contribution East Conference
      • 2022 ESG Investing Conference
      • 2022 DC Investment Lineup Conference
      • 2022 Alternatives Investing Conference