Case study: Rhode Island Pension Reform or Dallas Police and Fire Pension Reform

Running Head: RHODE ISLAND POLICE REFORMS 1
Police Reforms: A Case Study of Rhode Island
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Institution
Introduction
The General Assembly of Rhode Island passed a reform on the pension bill in 2011, which suspended adjustments in the cost of living for individuals who have retired an increment in the age of retirement and introduction of a funding system that is hybrid defined. Historically, Rhode Island pension system has been facing underfunding. In 1993, the total present value of employees of the state pension fund was represented by 72% of the total expected state liabilities. More so, the funds of the teachers faced a worse condition as compared to that of the state employees. Although the levels of funding somehow improved in the 1990s, they later faced rapid deterioration after 2000. The General Assembly made mode attempts to improve that situation using activities such as, increasing the minimum age retirement of the state employees. The measure failed to address the issue although it slowed down the rapid decline in stability of the Rhode Island pension fund (Company, 2012).
The treasure of the state appointed an actuarial assessment which was independent from the system since the situation was a threat the finances of the state. From the assessment, it became clear that there existed a pension liability that was unfunded amounting to 6.8 billion dollars. This implied a 50% less system funding relating to the obligations of the pension system. Later, with the collaboration of the governor, treasurer and state legislature leaders, they highlighted the problem and made a reform for the case. They also included various committees in the state and major stakeholders before concluding to the proposed reforms. What remains it an indication that the reforms will be able to meet the savings that were projected under the RIRSA planning. Rhode Island seem to make visible steps in the pension reform so long as the coming leaders do not use the past practices and this a good example that should be emulated by other states (Company, 2012).
History of Rhode Island’s Pension system
In 1936, the Rhode Island introduced a system for employees of the state in order to provide death, disability, and survivor and retirement benefits. Later, the state made an addition to the teachers’ pension plan which was managed with the collaboration of the employees of the state. After four decades, the state introduced two other pension funds that covered the police and the judicial system. Additionally, the state owns a relatively smaller benefit fund for teachers, managed separately from the main retirement system for teachers. Moreover, the state is also the manager of a pension system for municipal employees. Rhode Island has a population of averagely one million with around 150,000 individuals aged over 65 years. It is important to note that most citizens are not state workers and they don’t opt to work for the state. Therefore, it is an indication of lack of attention by citizens towards pension challenges and lack of effort towards their reforms.
The history of mismanagement of pension funds in Rhode Island led to the election a new state treasure...