pension-transparency

Center & Representative Nunes Call for Pension Fund Protection

FOR IMMEDIATE RELEASE: October 17, 2016
Political Correctness Should be Banned as Investment Criteria 

Providence, RI — The RI Center for Freedom & Prosperity recommends legislative action to end to the cronyism and overt politics that has caused instability to the retirement-security of public employees and that has exposed taxpayers to further risk. The mismanagement of Rhode Island’s public employee pension fund reached new lows last month when the State announced it was changing its strategy yet again, this time to divest of its “hedge fund” investments.

“Enough of the political correctness and insider cronyism. We call on lawmakers to act now to ensure that sound fiscal guidelines are adhered to,” suggested Mike Stenhouse, CEO for the Center. “The mismanagement and dismal performance of the state pension fund, under General Treasurers Raimondo and Magaziner, could have been avoided if sound investment practices were followed.”

Representative Jared Nunes (D-Dist. 25, Coventry West Warwick) has already expressed interest in submitting related legislation: “In order to protect retirees and taxpayers, it is vital that sound investment strategies are undertaken. Some kind of pension-fund protection act is clearly in order.”

Initial research indicates that a number of states have implemented, or are currently considering, provisions that require specific fiduciary guidelines to making pension fund investment decisions. A Pew Charitable Trusts report to the Committee on Alabama Public Pensions indicates that National Association of State Retirement Administrators (NASRA), suggests that pension fund trustees should adhere to “a robust fiduciary standard” in the execution of their duties, and supports the action of setting strong fiduciary standards into law so that the paramount goal of investment strategies should be the financial security of pension assets.

In recent years, conversely, Rhode Island policy has put retirees and taxpayers at increased exposure, because political correctness appears to have been the primary motivation of making certain investment decisions:

  • Treasurer Raimondo announced a divestment strategy in 2013 from high performing “gun” related investments … for political reasons. (In a similar move the City of Providence divested from eight fossil fuel companies.)
  • Treasurer Raimondo divested in 2014 from the states highest performing hedge fund, Dan Loeb’s Third Point LLC … caving to political pressure from teachers unions
  • Instead Treasurer Raimondo invested in other high-fee hedge funds … some of which were associated with her former investment company
  • Treasurer Magaziner announced in early 2016 that state’s proxy votes would be used to influence investment vendors to diversify their boards … to meet an arbitrary politically-correct standard
  • Treasurer Magaziner announced last month a “back to basics” investment strategy to divest of most hedge fund investments … bowing to political pressure from third-party critics
“Each of these fiscally-irresponsible decisions has led to deteriorating performance of the pension fund. There’s little reason to trust that Treasurer Magaziner’s new back to basics strategy will not continue be overly-politicized,” added Mike Riley, Chairman of the Center, and an investment and pension expert. “It is obvious now that the General Assembly must act to ensure proper fiscal due-diligence is conducted, devoid of political correctness considerations.”

In order to protect the security and stability of state retirement funds, Riley suggests that legislation should include the following goals:

  1. Ensure that all investment decisions are made solely in the best interest of the beneficiaries.
  2. Limit considerations for investment vehicles to measurable economic or fiscal factors only
  3. Ban other non-fiscal considerations, except in the most extreme instances (ie, Iran based companies)
  4. Ensure that investment fees and costs are reasonable in relation to the assets of the retirement system
The Center encourages incumbents and candidates for the General Assembly, prior to the upcoming elections, to make a pledge to voters and retirees to support related legislation in 2017.
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Center Supports Town of Narragansett Single-tier Property Tax Plan

FOR IMMEDIATE RELEASE: October 14, 2016

Narragansett’s Proposed Single-tier Tax Rate a Good First Step

Providence, RI — The RI Center for Freedom and Prosperity supports the proposed single-tier tax rate plan that will be decided at the Narragansett Town Council meeting on Monday, October 17.

The Center applauds the Town’s goal to create one of the best local business climates … in a state that has the worst overall business climate in the nation. The bi-partisan plan would significantly lower the commercial tax rate and slightly raise the residential rate to equal levels.

“If town families are to achieve a better quality of life, it is essential that more and better businesses, that create more and better jobs, have a better business climate in which they can thrive,” said Mike Stenhouse, CEO for the Center. “The positive benefits of this plan clearly outweigh the arguments against it.”

Currently, commercial properties pay up to 150 percent higher than the residential, leaving Narragansett as the only Washington County locality with a split rate.

Not only would a lower commercial rate spur local economic activity, but the single-tiered rate would eliminate the practice of pitting businesses against residential property owners when future tax policy is considered. The concept of tax policy that treats everyone the same, is a fundamental precept of American governance.

The slight increase in residential rates could be directly offset by taking advantage of a discussed “homestead exemption” for year-round, owner-occupied properties; this exemption has already received enabling approval from the General Assembly, and is in the works to be reviewed and decided upon in future Town Council sessions. Further, if the town does realize growth in the commercial business community, this could lead to reduced overall tax rates for everyone.

The plan would be even stronger, according to the Center, if the commercial rate would be lowered to the existing residential rate. This could be accomplished without raising the residential rate by cutting town spending by a few percentage points.
Additional commentary on Narragansett’s single-tier tax plan can be found on The Ocean State Current, the journalism and blog website for the Center.

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Democrats Boycott; East Bay General Assembly Candidate Forum Still on for Tonight

FOR IMMEDIATE RELEASE: October 12, 2016
Candidate Forum to Proceed Despite Democrat Party Boycott

Ken Mendonca and John Pagliarini to Participate
Linda Finn and James Seveney Refuse Invitation

Providence, RI — Apparently 630-WPRO AM radio is not the only boycott instituted by the Rhode Island Democrat Party. Portsmouth Concerned Citizens (PCC), which for many years has successfully conducted fair and nonpartisan successful debates, will move forward tonight with its scheduled Candidate’s Night Forum for the Senate District 11 and House District 72 races. The forum, sponsored by the RI Center for Freedom & Prosperity, will be conducted at 7:00 pm at the Portsmouth Council Chamber on 2200 East Main Road. The moderator for the forum will be Kate Nagle, political reporter and editor for GoLocalProv.com.

Incumbent Senator John Pagliarini (Republican) from District 11 has accepted the invitation, while his challenger, James Seveney (Democrat) has declined.

Vying for the open House District 72 seat, are Ken Mendonca (Republican) who has also accepted, and former Representative Linda Finn (Democrat), who similarly followed the orders of the Portsmouth Democrat party and will not take part in the event.

“It is clear that Mr. Seveny and Ms. Finn are not willing to defend the status quo failures of their party, which have caused our state to suffer from the worst business climate in the nation and the 48th rank in family prosperity,” suggested Mike Stenhouse, CEO for the Center.

The likely reason for the refusal to debate from the two Democrat candidates is a September 18 open letter from Leonard Katzman, Chair of the Portsmouth Democratic Town Committee. In the letter, Mr. Katzman called into question the “legitimacy” of the candidate forums and the “fairness” of the PCC.

Video recordings of the forum events will be submitted to the Public Access Studio for play on Cable Channel 16. The videos will also be posted online on the Center’s debate homepage at www.RIFreedom.org/Debates

The media and the public are welcome to attend and are encouraged to submit questions for the candidates. This is also an opportunity to meet the candidates and express your concerns directly. Coffee and refreshments will be served following each session.

Jobs & Opportunity Index (JOI), August 2016: State and Local Taxes Drag RI Back to 48

With the release of new state and local taxation data from the U.S. Census, Rhode Island fell back to 48th for the August Jobs & Opportunity Index (JOI). The Ocean State’s second-quarter increase in taxes over the first quarter compared with New York’s decrease made the difference, leading Rhode Island to lose ground against the U.S. and New England averages. In all, six of 13 datapoints are new the August report.

In Rhode Island, employment was up 1,275 from the previously recorded number, labor force up 1,770, and RI-based jobs down 100. (Note that these are calculated with pre-revision data for the prior month.) Medicaid enrollment increased by 1,243, while SNAP decreased by 711. As mentioned above, second-quarter state and local taxes were up $179 million from the prior quarter.

The biggest shift in the first chart, showing the six New England states in the national race, is Vermont’s big fall to fifth in the region (from 19th to 44th in the nation), above only Rhode Island. The reason is a large increase in Vermont’s state and local taxes, which were up by a factor of three, suggesting an issue of timing that might reverse for the next quarter. Although not as dramatic, New Hampshire has seen similar fluctuations, and returned to 1st in the nation, from 3rd last month. Thanks to Vermont, Connecticut is now third in New England, which is 33rd in the country (up three slots). Maine slipped a bit, to 20th in the nation, from 17th, while Massachusetts gained two spots, hitting 35th.

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The second chart shows the gap between Rhode Island and New England as well as the United States, which expanded this month. By contrast, Rhode Island’s gap shrunk on the unemployment rate (third chart).

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Results for the three underlying JOI factors were:

  • Job Outlook Factor (measuring optimism that adequate work is available): RI moved forward two slots to 36th place.
  • Freedom Factor (measuring the level of work against reliance on welfare programs): RI remained at 39th.
  • Prosperity Factor (measuring the financial motivation of income versus taxes): RI moved up two spaces to 44th.

Center to Sponsor GA Candidate Debates. Kate Nagle to Moderate. Portsmouth Democrat Controversy?

FOR IMMEDIATE RELEASE: September 21, 2016
Center to Sponsor Two Debates in Partnership with Local Groups

Kate Nagle from GoLocalProv.com to be moderator.
Portsmouth Democrats create controversy so as to not participate?
Other local groups invited to partner with the Center.

Providence, RI — The RI Center for Freedom & Prosperity announced today that it has reached an arrangement with a local group to sponsor two East Bay General Assembly candidate debates on October 12 in Portsmouth.

Portsmouth Concerned Citizens (PCC), which for many years has successfully conducted similar debates, has invited the candidates for Senate District 11 and House District 72 to participate in the 7:00 pm to 10:00 pm event, which will be held at the Portsmouth Council Chamber on 2200 East Main Road. The moderator for the two debates will be Kate Nagle, political reporter and editor for GoLocalProv.com.

Incumbent Senator John Pagliarini (Republican) from District 11 has accepted the invitation, while his challenger, James Seveney (Democrat) has not yet responded.

Vying for the open House District 72 seat, are Ken Mendonca (Republican) who has accepted, and former Representative Linda Finn (Democrat), who also has not yet responded.

As sponsor of the debate, the Center’s role is largely promotional: to raise state and local awareness and to potentially host a post-debate video of the event. The Center has also collaborated with the PCC to develop up to four questions of statewide interest that will be asked of each candidate. All other operations and logistics are the responsibility of the local group, in the PCC case, with all other questions to come from the audience.

Garnering a lead, front page story in today’s Newport Daily News, a likely reason for the lack of response from the two

Democrat candidates is a September 18 open letter from Leonard Katzman, Chair of the Portsmouth Democratic Town Committee. In the letter, Mr. Katzman called into question the “legitimacy” of the candidate forums and the “fairness” of the PCC. Katzman also cast aspersions on the Center by falsely claiming Koch-brother backing and that the Center’s agenda is “antithetical to Democratic Party principles.”

“Our Center has earned the reputation as a nonpartisan and strong advocate for taxpayers: I cannot imagine that Mr. Katzman believes that looking out for taxpayers goes against his Democrat party principles. After all isn’t a debate supposed to be about discussing varying views of government? What are he and his candidates afraid of,” questioned Mike Stenhouse, CEO for the Center. “Further, his mindless attempt to impugn the credibility of our Center through a bogus ploy of guilt-by-association to certain non-donors … is completely false. I call on Mr. Katzman to retract that statement.”

Thanks to the generosity of some of its donors, the Center has the financial capacity to sponsor additional debates. Local, nonpartisan groups interested in conducting their own debates should send an email to info@rifreedom.org.

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The 2016 “Sheeple” Index: Alarming Number of Lawmakers Vote in Lock-step with Leadership

Despite polices that have caused the Ocean State to suffer the 50th ranked business climate, the 48th rank in Family Prosperity, and the 47th rank in Jobs & Opportunity, our new 2016 “Sheeple” index demonstrates that there is scant dissent among Rhode Island lawmakers who vote for such policies.

This index ranks how often state Representatives and Senators voted in lock-step with leadership. Even with the 2016 General Assembly scoring a dismal (-54.1) on the Center’s 2016 Freedom Index, there was little opposition as more than half of all lawmakers voted with the House Speaker or the Senate President over 95% of the time.

The 2016 “Sheeple” index is a collaboration between WatchdogRI.org and our Center.

IMPORTANT DISCLAIMER: Lawmakers who were not present and missed votes are artificially credited in this “sheeple” index as having not voted with leadership. Please refer to the “missed votes” (or Walker) index here to see how many votes any particular lawmaker incurred.

Of the 2016 House’s 489 bills examined, excluding resolutions and solemnizations: 24 Representatives voted at least 98% of the time with the Speaker, with the worst-five “sheeple” offenders are:

  • John DeSimone (99.8%)
  • Ray Johnston, Jr (99.8%)
  • Michael Morin (99.6%)
  • Brian Kennedy (99.39%)
  • Lauren Carson (99.2%).

Of the Senate’s 487 bills, 11 Senators surpassed the 98% sheeple threshold, the five least independent when it came to casting votes in lock-step with the Senate President are:

  • Susan Sosnowski (99.6%)
  • Dominick Ruggerio (99.2%)
  • Erin Lynch (99.2%)
  • Steve Archambault (98.8%)
  • Hanna Gallo (98.6%)

“In a healthy democracy, there should be a rigorous debate of diverse policies. Sadly, and conversely in Rhode Island, it seems that when leadership authorizes bills to move forward, legislators feel compelled to automatically support them,” commented Mike Stenhouse, CEO for the Center. “The statistics in this report present an alarming pattern of elected officials blindly following the leader. Voters this November must decide if this is how they want their government to be run.”

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EXETER top-ranked delegation; NEWPORT last on 2016 Freedom Index

FOR IMMEDIATE RELEASE: September 16, 2016
Only 3 Towns Scored in Positive Territory; 16 Cities & Towns Below General Assembly Average

Providence, RI — Following yesterday’s release of its annual Freedom Index and Legislator Scorecard, the nonpartisan Rhode Island Center for Freedom & Prosperity today published a 2016 ranking of the General Assembly delegations from the Ocean State’s 39 cities and towns. The Exeter delegation of House and Senate lawmakers, based on their individual floor-votes, was the highest ranked in the state, while the Newport delegation ranked lowest.

EXETER’s top-rated score of +19.37 by its delegation, consisting of Representatives Price and Costa, and Senator Morgan, was higher than the General Assembly’s overall score of negative (-54.1). During the 2016 legislative session, the Exeter lawmakers generally voted to advance freedom in the Ocean State.

Sen. Elaine J. Morgan (R) of district 34 in Exeter scored a +23.73 overall on the 2016 Freedom Index, while Rep. Doreen Costa (R) scored a +20.8 and Rep. Justin Price (R) scored a +13.60.

Conversely, NEWPORT’s score of (-68.5) by its delegation of Representatives Carson and Abney, and Senators Paiva Weed and DiPalma. was worst in the state in 2016, reducing the freedom of Rhode Islanders.

Rep. Lauren Carson (D, district 75) scored a (-67.8), while Rep. Marvin Abney (D, district 73) scored a (-67.8), Sen. Teresa Paiva Weed (D, district 13), scored a (-68.4), and Sen. Louis DiPalma (D, district 12) scored a (-71.2).

TOP-3, BOTTOM-5. Joining Exeter as the only 3 towns to achieve a positive score was Richmond and Charleston. In addition to Newport, the bottom five towns were Pawtucket, East Providence, Providence, and Jamestown, all of which are part of the 16 cities and town that scored below the average General Assembly score.

On the main RIFreedom.org/FreedomIndex home page, voters have access to a multitude of data and tools, including links to:

  • Legislator Scorecards for 2016 as well as for the prior 4 years
  • Interactive data from 2012-2016 that can be filtered by a number of criteria including city/town, party, lawmaker, year, category, etc …
  • 38 Studios Scorecard, released last month
  • “Walkers” Index, which tallied missed votes by lawmakers over the past 3 years, released in collaboration with WatchdogRI.org

Later this month, again in collaboration with WatchdogRI.org, the Center also plans to release its first-ever “Sheeple Index“, which rates how often lawmakers vote in lock-step with political leadership.

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VOTER GUIDE: Final Legislator Scorecard & Freedom Index

FOR IMMEDIATE RELEASE: September 15, 2016

Failed Status Quo Exemplified by Continued Deeply Negative Overall General Assembly Scores

However, real-time ratings led to more positive individual scores

Providence, RI — Loaded with information that may be useful to voters this fall, the RI Center for Freedom & Prosperity published today the final report for its annual Freedom Index and Legislator Scorecard, as part of its larger transparency initiative.

Led by Representative Patricia Morgan (R, West Warwick) and Senator Elaine Morgan (R, Exeter) only 11 of 113 lawmakers, on a scale of (-100) to +100, earned positive scores: 10 Republicans and one independent; with nine in the House and two in the Senate.

Overall, however, the General Assembly as a body scored a negative (-54.1), continuing its five-year trend deep in red numbers, meaning Rhode Islanders have less freedom than they did last year.

“It is a result of this failed status quo of increased government intervention in our personal and business lives that we believe is why the Ocean State ranks so poorly in so many national indexes,” commented Mike Stenhouse, CEO for the Center. “It is not acceptable that we rank 50th, with the worst business climate in the nation; 48th on the national Family Prosperity Index (FPI); and 47th on the Center’s Jobs & Opportunity Index (JOI). It’s up to voters to review this data and decide whether or not to hold lawmakers accountable for their voting records this November.”

On the RIFreedom.org/FreedomIndex home page, voters have access to a multitude of data and tools, including links to:

  • Legislator Scorecards for 2016 as well as for the prior 4 years
    Interactive data from 2012-2016 that can be filtered by a number of criteria including city/town, party, lawmaker, year, category, etc ..
  • 38 Studios Scorecard, released last month
  • “Walkers” Index, which tallied missed votes by lawmakers over the past 3 years, released in collaboration with WatchdogRI.org

Among other findings:

  • The Exeter contingent of House and Senate lawmakers was the highest ranked in the state, while the Newport contingent ranked lowest
  • House Republicans were the only major party caucus to score in positive territory (+7), while Senate Democrats were the lowest scoring (-68.8)
  • Overall, Republicans moved significantly higher, while Democrats dropped lower, further widening the partisan gap

Also, as a result of its new 2016 policy to post online real-time bill ranking and lawmaker scores, the Center was successful in proactively influencing future votes as opposed to just a reactive scoring of past votes. This can be evidenced by the fact that a number of lawmakers who followed the Center’s recommendations scored in positive territory in 2016, after years of almost no lawmakers scoring above zero.

Later this month, again in collaboration with WatchdogRI.org, the Center also plans to release its first-ever “Sheeple Index”, which rates how often lawmakers vote in lock-step with political leadership.