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Call for a bid (530) 736-9327 License #879689 Deal is announced in landmark pension case PROVIDENCE, R.I. (AP) — Rhode Island state leaders and union officials announced a deal Friday that would end legal wrangling over a landmark pension over- haul that's been a model for other states seeking to rein in runaway pension costs. The proposed settle- ment must win legislative approval and the endorse- ment of union members and retirees. But if enact- ed, the changes would retain the most significant portions of the 2011 pen- sion overhaul, which raised retirement ages and suspended pension bene- fits to save billions of dol- lars in future costs. ''This is a very good deal for the people in the pension system and the people of Rhode Island,'' said Treasurer Gina Rai- mondo, a Democrat who crafted the original law and is now running for governor largely on her success in bringing the pension system in check. ''I do hope other states fol- low our lead. We have shown that Rhode Islanders can come together and tackle big issues.'' Rhode Island had one of the most troubled pen- sion systems in the nation before lawmakers passed the sweeping changes dur- ing a special legislative session in 2011. The so- called Rhode Island Retirement Security Act was designed to save an estimated $4 billion for the economically troubled state over the next 20 years. But many of the 66,000 state workers, teachers and municipal workers and retirees covered by the state retirement system complained that the changes amounted to bro- ken promises and an unconstitutional change to their benefits. Their legal challenge has been the subject of closed-door set- tlement talks for more than a year. The proposed settle- ment would give retirees a one-time 2 percent pen- sion increase on the first $25,000 of their pension, and then increases of up to 3.5 percent every four years beginning in 2017. The existing law sus- pended the increases for five years. Regular increases will return when the state's retirement fund is 80 percent funded. Cur- rently it's roughly 60 per- cent funded. Also, as part of the deal, employees with 20 years of service can keep their existing pension plan instead of receiving a hybrid plan that combines a pension with a 401(k)- type account. All other workers would receive the hybrid plan, though gov- ernments would con- tribute slightly more to workers with more years of service. Employees would also pay slightly more toward their own retirement than under current law. While workers and retirees won some conces- sions in the settlement, much of the significant portions of the 2011 law would remain. Lynette Labinger, lead counsel for the plaintiffs, said that while unions and retirees didn't get everything they might have wanted in the settlement, they'll receive pension increases far sooner than under current law. It also avoids what could be a risky legal fight. ''It provides certainty,'' Labinger said. ''You don't usually get everything you want.'' The settlement would raise the annual pension costs for the state and its cities and towns. In the fis- cal year beginning July 1, 2015, the state would have to set aside an additional $13 million. Cities and towns would see their retirement bills increase by $11 million. Overall, the changes would raise the state's unfunded pension liability from $4.8 billion to $5 bil- lion. But it would maintain nearly all of the $4 billion in savings created by the 2011 law. While many states have made efforts to rein in pension costs, none have taken the steps Rhode Island did. The pension overhaul was cited as an example during debates in states like California and Illinois that face their own pension problems. Rai- mondo's efforts to pass the law were hailed by The Wall Street Journal and Time magazine. Collectively, states face a $757 billion gap between what they've promised in retirement benefits and what they have set aside to pay for it, based on a study by the Pew Charitable Trusts, and Rhode Island was widely seen as a test case for efforts to rein in pen- sions elsewhere. The settlement now moves into what is likely to be a complicated and time-consuming approval process. Union members and retirees will likely be asked to endorse the settle- ment by mail ballot. The state's retirement board endorsed it Friday, and lawmakers will be asked to approve the deal this year — though it could be May or June before any vote is held. If they reject or modify the settlement proposal, the lawsuit would likely proceed to trial. Lawmakers have criti- cized the closed-door negotiations that yielded the settlement, and Rep. Joseph McNamara, D- Warwick, said he expects lawmakers to closely scru- tinize the deal. ''I'm not going to rub- ber stamp anything,'' McNamara said. ''We spent months on public hearings and studying data for the initial reform act. We're going to have lots of questions about the impact on both the employees and the cities and towns that will have to pay for this.'' Indeed, Cranston Mayor Allan Fung — a Republican candidate for governor — blasted the process behind the settle- ment and said it's going to burden cities and towns that are struggling with deficits and a lagging economy. Rhode Island's unemployment rate is 9.1 percent, the highest in the nation. ''They sold out the tax- payers,'' he said of the state officials involved in the mediation. ''This is a significant amount of money they're asking the cities and towns to pay. And they're just kicking the problem down the road.'' Thousands in dark in Ga., SC WILLISTON, S.C. (AP) — Ben Ziegler frowned grimly as he used borrowed equipment to cut firewood for his home on the third day without power to keep his wife and 14-month- old daughter along with a neighbor family of five warm. ''I got tired of this about five minutes after the lights went out,'' the 33-year-old U.S. Army veteran said at a firewood stand near his Evans, Ga., neighborhood. Despite their weariness, Ziegler and thousands of oth- ers in east Georgia and western and southern South Carolina may be without power for sev- eral more days. The nasty win- ter storm that blew through the South and eventually barreled up the East Coast dumped a tree-splitting, utility-pole- snapping inch of ice on the area and many, including South Carolina Gov. Nikki Haley, compared the damage to the aftermath of a hurricane. ''I didn't know this was going to be in the same realm as Hugo,'' Haley, who toured damaged areas Friday, said of the hurricane that struck in 1989. ''To look at these neigh- borhoods and see the trees down and on houses — to see all of the devastation that's happened to this community — is terrible.'' The same system dumped more than a foot or two of snow on parts of several states and was blamed for more than two dozen deaths, closed schools, snarled air traffic, caused countless crashed and delayed thousands of flower deliveries on Valentine's Day. The longest-lasting effect, however, was power. About 1.2 million utility customers from the South to Northeast lost power at some point during from the South through the Northeast. That dramatically dropped to about 465,000 outages by Friday morning, mostly in South Car- olina and Georgia. The num- bers did keep dropping, but life without electricity after a third day was becoming a hassle. With roads finally thawed out, many in the hardest hit areas were able to finally leave their homes. But there weren't too many places to go. Few stores were open because they didn't have power either. Dollar General stores across the region let people shop by flashlight, but were only taking cash because they had no way of scanning credit cards. Inter- sections became risky games of chicken because traffic lights were out and deputies were elsewhere trying to help clear trees and limbs off roads and checking on older people and the sick. Losing power in a rural area often means losing water, too. Many residents are on wells with pumps that need electrici- ty to operate. Some people had buckets out to catch the melt- ing ice so they could use the water to flush their toilets. To Subscribe Call Today! 527-2151 N EWS D AILY RED BLUFF TEHAMA COUNTY T H E V O I C E O F T E H A M A C O U N T Y S I N C E 1 8 8 5 Web: www.redbluffdailynews.com E-Mail: adverise@redbluffdailynews.com