To the Editor:

Anyone who has read the newspapers or listened to talk radio is aware that the governor’s proposed budget cuts will have an impact on cities and towns throughout the state. Mayor Avedisian would have you believe that it is the governor and the school department who are totally responsible for Warwick’s budget woes. Does his administration share in the blame? Let us explore the facts.

The biggest costs affecting Warwick are pensions and employee benefits. The city had an unfunded pension obligation of $210 million before last year’s stock market freefall. Today it is approaching $270 million. Warwick’s younger generation is now responsible for an additional $60 million of indebtedness.

Keep in mind that unlike 401k plans that are prevalent in private industry where the employee is responsible for their account shortfall now forcing many to work past their planned retirement date, city workers have a defined benefit plan, which is indemnified, i.e. the taxpayers make up the differences in their accounts. Are the taxpayers contributing enough to the city employees’ pensions?

For every $1 a fireman makes, the citizens of Warwick contribute an additional 19 cents toward their retirement. In private industry it is only an extra 3 cents for every dollar they earn. The total benefit package for a fireman adds an additional 60 cents for every dollar they make. In private industry it is an additional 19 cents.

For a fireman making $50,000 per year, the taxpayers contribute an extra $30,000 for benefits. In private industry the person making $50,000 would receive $9,500. Is this why, as the governor points out, the state has the highest cost per capita for fire protection? On top of that the mayor increased in the last few years the amount firemen receive at retirement from 70 to 75 percent of salary. He attempted to increase it to 80 percent but the City Council wouldn’t agree. These increases were all done in spite of the fact police and fire pension plan #1 was $195 million underfunded. Does the mayor agree with the governor that cost of living pension increases should be eliminated in the future?

Now the mayor is proposing to take $500,000 from Warwick’s pension contributions to plug the hole in this year’s budget. Wouldn’t it have been more prudent for the mayor to forgo the bonuses of $161,000 for city workers not using sick time and use that savings to help solidify this year’s budget? The mayor set up a retirement panel years ago to explore changes in Warwick’s pension plans and only a crisis is finally forcing him to consider changes. The mayor has had more than 18 years as an elected official to offer reforms. Why hasn’t he?

The city spends $34 million on health care. This figure includes both the school department and the city. It is 13 percent of the budget. Five years ago I attended a budget hearing where concerned taxpayers implored the mayor to begin assessing a 20 percent co-pay for health care. Today that would mean a family plan would cost a city employee $57 a week. If the city imposed that figure today, we would save close to $7 million a year. What did the mayor do? He agreed to $11-a-week health care co-pay in the firemen contract he personally negotiated. For years all city contracts had the $11 co-pay. What did the mayor give away to get the $11? He agreed to a $300-a-year cap on prescriptions. This benefit is now also in all city contracts at a cost of $700,000 a year. He also agreed to lifetime health care for firemen and their wives at a cost of $4,800 per year per couple at age 65. He also attempted to increase their pension benefits. Is the governor responsible for these budget buster costs? Do you understand why we don’t have the money for Little League programs? Remember the mayor felt just last year that we should continue paying part-time crossing guards health care benefits at a cost of over $14,000 yearly per family. On future contracts, call your city counselors and ask them what exorbitant benefits the mayor has granted. Make sure they don’t rush to judgment but rather give the taxpayers ample time to review the contracts. Ask that the city do a long-term cost analysis. If there are any changes in pension benefits, insist that they be based on an actuarial study that includes 2007 calculations because last year the pension plans lost 26.5 percent. Your financial well-being depends on it.

For years Councilmen Merolla and Solomon have asked why the fire department overtime cost is so high. The mayor has said minimum manning levels make it difficult to control. The governor proposes to eliminate the minimum manning requirement. The mayors of Providence and North Providence enthusiastically embrace this change but the mayor of Warwick has yet to weigh in. Is he for or against it? If implemented, it would save the city hundreds of thousands of dollars.

The city of Warwick does not have a revenue problem, but we do have a spending one. I would ask the mayor to stop wailing and stop blaming everyone but his administration for Warwick’s budget woes. If he would start undoing the lucrative contracts he extended, the mayor would find the money he needs to put Warwick on a sure fiscal footing.

Roger Durand
Warwick