Pension lies of Raimondo, Magaziner and NEA Bob Walsh exposed ...retirees misled

         The Data shows that Rhode Islander taxpayers and teachers have been fed lies by Gina Raimondo, Bob Walsh and Seth Magaziner. The evidence is overwhelming that Rhode Island pension Assets have been badly mismanaged from 2011 to and through 2018. Both Gina Raimondo and Seth Magaziner have performed in the bottom 20% of their peers managing our money. They also finished in the bottom 5% for low expense ratio. They have spent enormous amounts on Wall Street management fees ,in fact double the rest of the Treasurers in the United States.The evidence is real and documented ,but since the Rhode Island media spoon feeds the spin directly from Raimondo and Magaziner ,without fact checking, you get the Government spin.

    This blog seeks to tell citizens the truth because our Media is incapable of telling the truth. 

       For illustration purposes , I have attached a segment from the State of Virginia CAFR 2017 that expressly states the improvement in Virginians  funding ratio over the last 4 years. 

       Rhode Island funding ratio on the other hand has  DECLINED after reform and during this record bull market from roughly 61% ,after 2011 Raimondo reform to 52% now. Rhode Island Retirees need to see an 80% funded ratio ,as promised by Raimondo, before their suspended Cost of Living Adjustments are reinstated.  Bob Walsh after publicly endorsing  Gina Raimondo for Governor defended this performance effectively ignoring retired teachers. Shameful ,but perfectly legal. Virginia had a very similar Hybrid pension reform and yet. in the last 4 years, Virginia's funded ratio has IMPROVED from 65.4% to 74.5%.

Virginia Dramatically Improved , Rhode Island dramatically deteriorated. Virginia 74.5% funded , Rhode Island 52% funded.

     The Governor and the Treasurer owe Rhode Island citizens a better explanation of their terrible record over the last 8 years. Had Rhode Island performed as well as Virginia retirees, retirees in Rhode Island  would be in reach of reinstated COLAS. Taxpayers would be $ 1.6 billion better off. 

The bad news is the market has had a significant decline and pension funds across the nation are suffering but if Magaziner track record holds true, Rhode Island will do worse than 80% of the nation and could soon be under 50% funded.

   Below is a passage from Virginia's 2017 Comprehensive Annual Report pg8

https://www.varetire.org/pdf/publications/2017-annual-report.pdf

Providence RI last Pension Actuarial valuation 3 years ago - update

Today is November 20,2018. Providence has not yet released its final  pension Plan performance numbers for the month of October 2018. Based on a recording of the meeting on the City website we are expecting a significant loss of at least 4% which wipes out any gains for Fiscal 2019 and Calendar 2018. this is a very concerning development given the stated low funding ratio of 25% ( our estimate is 16%).
   Of particular concern , from a transparency standpoint, is the absence of Actuarial Valuations of the pension plan which were completed every year for 50 years by Buck Consultants who was fired by Mayor Angel Taveras during his minor and ineffective pension reform of 2013-4. After Bucks firing the City hired Segal Company  who ultimately agreed that the City was overstating assets in the pension plan an adjustment was made of approximately $60 million dollars.
    The City of Providence and new Mayor Jorge Elorza openly mocked calls for bankruptcy and funded 2 studies that highlighted enormous structural deficits and huge pension funding issues. At this  point it is more likely that the pension fund becomes solvent than Mayor Elorza moves or asks for State Receivership. Mr Elorza, since 2015 and after  admonition by the Auditor General Dennis Hoyle, has vowed to pay pension contributions on time( within the same fiscal year they are due) The city has never paid pensions contributions on time  the  under previous Mayors David Cicilline, Angel Taveras and now under Jorge Elorza. Mr Elorza ,despite misleading taxpayers and mis-directing pension contributions for other use , was re-elected in a landslide to two more years as Mayor of Providence on November 6th.
    In my candidacy for State Treasurer of Rhode Island , I have been extremely critical of Providence and its woeful accounting and have demanded that Providence undergo an outside forensic Audit of its finances and its Pension plan. I have no confidence that Providence has accounted for pensions correctly nor that they are distributing the proper benefits to the appropriate recipients.
    I twice accused the City of fraud and asked the Rhode Island Attorney  General to investigate. I have also reported my theories to the Securities Exchange Commission and MSRB . Thus far there has been no response from the SEC and AG Peter Kilmartin responded that potential Municipal fraud or Misleading Municipal bond investors were not part of his jurisdiction. Similarly I reported evidence of insider trading in the Infamous RIEDC  38 Studios bonds , Mr.  Kilmartin also told me he would not investigate as it was not in his jurisdiction. (side note  Mr Kilmartin was a senior Democratic legislator when 38 Studios loans were made)

More recently ,it has come to my attention that the city is for the first time no longer posting or paying for an annual actuarial Valuation of the pension plan. The last actuarial valuation posted on its "transparency site" used 2015 numbers. This is intolerable. Citizens should demand the Mayor and Town Council update the Actuarial Valuation of the pension plan.

http://www.providenceri.gov/wp-content/uploads/2018/05/Employee-Retirement-Sys-City-of-Providence-July-1-2016-Actuarial-Valuation.pdf

The City of Providence signed a new 3 year agreement with Segal in October