Testimonies Presented to Pension Working Advisory Group by Chapter 94 Members

Dolores Bresette
My name is Dolores Bresette, and I worked for the state of Rhode Island for 37 years, which is more than half my life. I retired from RI College, where I was an Information Aide. Throughout my career, I paid almost 9% of my biweekly paycheck into the pension system, hoping to secure a comfortable retirement for myself and my family. After confirming that my monthly pension check and cost of living adjustments (COLAs) could meet my family's needs, I decided to retire. However, the 2011 pension legislation, which suspended COLAs, had an unexpected and devastating impact on my retirement income. I thought I had lost $70 per month then, but by 2023, the monthly deficit is now greater. Since then, living costs have increased significantly, while my pension benefits remain stagnant. As a retiree on a fixed income, inflation has eaten into my purchasing power, creating extra stress on my household budget. My late husband and I had carefully planned for our golden years, hoping to help our grandchildren attend college, but the COLA suspension forced us to re-evaluate our plans. I re-entered the workforce. At first, I worked to stay active, but now, my part-time income helps supplement my pension and Social Security benefits. Since 2005, our retirement security has been slowly eroded by the State. Many retirees like me, who faithfully served the State, struggle to keep up with the rising costs of heating our homes, putting gas in our cars, paying for auto and home insurance, and having enough to pay for food and groceries. The 2011 pension reform was the ultimate insult. It was a blow that took money out of our pockets and broke the promise made to us when we started our careers. That’s why many retirees feel frustrated and betrayed. However, I am optimistic and trust the Pension Advisory Working Group will consider the importance of reinstating annual COLAs and that our elected leadership will follow through on the recommendation. Thank you for hearing my story.
Ronald Pepin
This is my story about COLAs, suspended for over 12 years, and how it affected me. I retired from the Department of Labor & Training in June 2008 after 32 years of service, with the promise of a yearly cost-of-living adjustment starting after the third year of retirement. I received just one COLA In 2011. Then, COLAs were suspended. When I retired, based on the calculations, I opted for the middle amount of pension earnings so that my wife could receive half in case something happened to me. A COLA would have allowed my family financial stability so I could wait until age 66 1/2 before collecting my Social Security benefits. But, because of the COLA suspension, I had to collect my Social Security at age 63 to help offset the loss of not receiving cost of living increases. It costs two months of my pension to cover taxes and insurances. This means that I live on ten months of my pension earnings. My Social Security benefits make up for the shortfall. I know that reinstating back COLAs won’t happen. However, I hope this Pension Advisory Working Group will bring about positive changes for us in the future, providing some relief to many public sector retirees like me. Thank you for the opportunity to be heard.
Mary Riley
I worked for the State of Rhode Island for 31 years until I retired from my job at RI College five years ago. Pension "reform," initiated by then-General Treasurer Gina Raimondo, changed how I live in retirement. Due to the 2011 legislation, I had to work an additional four years and could not receive the maximum pension benefit of 60% of my salary. Furthermore, the change in the benefit calculation from averaging the last three years of pay to the final five-year average reduced my pension earnings. The COLA suspension meant my monthly pension check could not keep up with inflation. This was and is a significant financial setback. In summary, I had a long career with the State, during which I planned and saved for my retirement years. The changes imposed by the 2011 legislation forced me and my family to alter how we approached retirement. All the financial planning to prepare for retirement was immediately rendered moot. I hope the Pension Working Advisory Group will recommend solutions to address the injustices rendered to retirees. Thank you for the opportunity to testify.
Donna M. Folcarelli
In 2008, the state had plans to change the rules for retirement, including increasing the retirement age. At age 50, with 31 years of state service, I reluctantly retired. I say reluctantly because I planned to stay in my job until I reached full retirement age. I only needed four more years to receive 80% of my pension. Leaving early meant my pension and health care benefits would remain even if the state made any changes. Before deciding, I went to the state retirement board to speak with a counselor. I was told that at age 50, I should take the Social Security option. According to the counselor, by the time I reach Social Security age, my pension income, plus regular Social Security and annual COLAs, would offset the impact of taking the state’s Social Security option. So, I took the counselor’s advice. I received two annual COLAs, and then the law was changed. Reform eliminated annual COLAs until the pension fund’s unfunded liability decreased. The benchmark became 80% funded. When I turned 62, my pension was reduced because I took the higher benefit when I first retired and had to collect my federal Social benefits. The necessities, food, shelter, and heat prices have increased since 2008. Just “Google” any inflation calculator to find that what $1.00 brought in 2008 now costs $1.43. The formula upon which the current four-year COLA does not help with today’s rising prices. I ask that the Pension Working Group right the injustice and restore annual COLAs or allow a yearly 3% stipend as described in one of the bills introduced in the last session of the General Assembly. Retirees need an increase to keep up with these inflationary times. Thank you very much for the opportunity to tell my story. And thank you to my colleagues at RI Chapter 94 Retirees for who made the effort to speak before the Working Group tonight.
Jamie Reilly
I worked at the pharmacy at MHRH until I retired in 2008. I took the SRA option, knowing I would receive my pension plus the compounded interest until age 62. Back when I retired, taking the SRA made sense to me. I knew that once I reached age 62, the annual COLA would cover any SRA offset. I would be financially comfortable. That scenario didn't play out, for the pension rules changed when the legislation passed. COLAs were put on hold until the pension system became 80% funded. Looking back, that number seems so arbitrary. Of course, how can I not be upset, for after making the carefully thought- out decision to retire, my financial security and retirement life would radically change? Pension reform, hah! Retirees, like me, and the current actives took the hit. Not the State! Just go to the grocery store. Or the gas station. Or the pharmacy to see how the costs of drugs, even over the counter, have skyrocketed since 2008. Making ends meet has become increasingly difficult when my pension benefit, without COLAs, is static while prices for family necessities have increased. I see this when I shop for food. Today's dollar buys about 70% of what it could have bought in 2008. Restoring annual COLAs would help me and the 300 retirees who opted for the SRA. I know the Pension Advisory Group has been tasked with making recommendations. I am here to remind you that the lives of many, including me, have been turned upside down. I urge you to make it right; restoring annual COLAs is a good start. Thank you.
Linda Folcarelli
What’s that saying, “If I knew then what I know now?” I may have remained working for the State. I made retirement decisions based on the pension rules in 2008. I loved my job at the Department of Corrections and Correctional Industries. But by 2008, I had completed 29 1⁄2 years of service with the state, and with changes to our retirement looming, I reluctantly retired to maintain the then-current pension and health care benefits. Before leaving state service, I sought guidance from the Retirement Board and met with a retirement counselor. Considering my age, the counselor advised me to opt for SRA, the Service Retirement Allowance. The SRA, including cost-of-living adjustments (COLAs), would ensure that I receive the full pension amount by the time I reach the Social Security age. I followed the counselor's recommendation and started the retirement process. After receiving two COLAs, the law changed, and COLAs were discontinued until the pension system funding level reached 80%. As I turned 62, my pension benefit was reduced, and I had to start collecting Social Security earlier than planned. Since 2008, the prices of goods and services have increased significantly. The marginal cost of living adjustments we received are not enough to cope with today's escalating prices. Even the fractional COLA that kicks in 2024 does not make up for the price of necessities that retirees need to live and thrive. I understand we can’t return to what was in place in 2008. But retirees do need relief. Therefore, I urge the Pension Advisory Working Group to recommend reinstating the annual cost-of-living adjustment for retirees to help us keep pace with inflation. Thank you for the opportunity to provide testimony.