In Portsmouth: Fierce debate over 'closed' pension plan

Manager’s explanation brings issue ‘out of the closet,’ councilor says

By Jim McGaw
Posted 3/29/23

PORTSMOUTH — After several years of nagging questions over the town’s supposedly closed pension plan, the matter came to head Monday night during a Town Council discussion of the R.I. …

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In Portsmouth: Fierce debate over 'closed' pension plan

Manager’s explanation brings issue ‘out of the closet,’ councilor says


PORTSMOUTH — After several years of nagging questions over the town’s supposedly closed pension plan, the matter came to a head Monday night during a Town Council discussion of the R.I. attorney general’s recent ruling that the council had violated the state Open Meetings Act (OMA).

The question repeatedly raised by council member David Gleason, Portsmouth Concerned Citizens President Larry Fitzmorris, and another resident, Tom Grieb, was this: Were town or school employees added to the town’s defined benefit pension plan after it was closed back in 2012, and when was the decision made to change the plan?

That question was at the crux of an OMA complaint Fitzmorris lodged against the council in July 2022. He alleged the council violated the OMA when it met in executive session on Sept. 14, 2020, to discuss the town’s pension plan “without providing advanced notice to the public of that intended discussion,” according to the Jan. 19 decision by the attorney general’s office.

The AG’s office ruled that the council did indeed violate the OMA, but found no evidence of a “willful or knowing violation.” No fines were imposed on the town, nor were any of the council’s actions declared null and void.

Gleason recently wrote to Town Administrator Richard Rainer, Jr. with a list of questions about the pension plan and the OMA violation, and received a point-by-point response from the manager. He and council member Charles Levesque — neither was on the council in September 2020, when the executive session in question was held — asked that the administrator’s response and a discussion about the OMA complaint be put on Monday’s agenda.

For starters, both council members said they found it odd that the OMA ruling was never officially communicated to council members. Gleason said since he was elected back to the council in November 2022, he’s received notifications about the town’s insurance plan, speeding-related issues, and invited to a Jack Reed talk and more, “but still don’t know why this issue, which seems much more important, was never brought to our attention, let alone discussed,” he wrote to Rainer.

“How an open meetings violation decision is not required by the attorney general to somehow be put on the agenda of whatever municipality was charged doesn’t make any sense to me. It’s an oxymoron,” said Levesque.

He added, however, that he believed the violation was “very much ado about nothing. It really was not very significant and no repercussions came of it.”

In his written response to Gleason, Rainer said “we do not normally inform the council of these types of notices until there is an indication the town will be fined or there will be a finding of injunctive relief,” and in this case, the AG found no “willful or knowing violation.”

Things got somewhat heated when Fitzmorris took the podium and criticized Levesque for downplaying the severity of the OMA violation. The AG’s office rarely fines or punishes a public body for violating the OMA, so one shouldn’t read too much into the fact that the Portsmouth Town Council was also left relatively unscathed by the ruling, he said.

Fitzmorris started to read from the AG’s ruling when he was interrupted several times by Levesque, who pointed out the decision was a public record that was included as backup on the agenda.

“Unless you don’t think the people of the Town of Portsmouth can read, Mr. Fitzmorris, let them read it for themselves. They don’t need your expert opinion on it,” Levesque said.

“Well, we had your opinion, so I’d like to give mine,” responded Fitzmorris, who continued to quote from the AG’s ruling, which stated the council met in executive session to discuss the pension plan. 

“Those are public issues. Those should be discussed in public,” Fitzmorris said, noting that Levesque and Gleason were not on the council in September 2020, “so they are not complicit in this complaint.”

Pension plan questioned

As for the town’s defined benefit pension plan, Fitzmorris and Grieb have continually pressed the council for answers as to whether some employees were placed back on the plan despite it being “closed” more than a decade ago. The council voted in November 2012 to close the defined pension plan, with new hires offered a a 401K plan, and Town Hall management employees’ plans frozen as of July 2014 and placed into a 401K plan.

In his response to Gleason, Rainer said although the plan was closed in 2012 — three years before he was appointed administrator — anyone hired before July 1 of that year was eligible to remain in the plan and should not be considered additions. In October 2014, two Town Hall managers asked to be “unfrozen” at a council meeting, but the council voted not to change the plan. Additionally, the police union’s demand to be returned to the pension plan was “a steadfast ‘no,’” Rainer wrote.

However, in August 2021 Rainer said he learned that a “loophole” had been created by former Finance Director Jim Lathrop for the school department. One school employee, who was terminated that month and paid out a lump sum of her contributions, no longer affects the town’s pension liability. Another school employee was hired in the same month and does increase the liability, Rainer said.

On Monday, Rainer reiterated what he told Gleason: “There’s only one school employee who was admitted to the pension,” he said. “There were no new town employees added to the pension after it was closed.”

“I can only state that everything has to be taken in context of what was going on at the time,” Rainer continued. “When I was informed there was an employee on the school side that the school administration was adding to the pension plan, you can surmise I was rather shocked by that. I was immediately given a memo … that highlighted the fact that there’s a class of school employees that in fact could be added to the defined benefit plan. The Town Council, as the pension board, acted to mitigate potential legal liability to the town and took a vote to remedy that.”

Rainer was hired as town administrator in May 2015. “Not a single change has been made to the pension plan under my authority. I’ve never had that authority, I’ve never exercised that authority and I would never presume I have that authority,” he said, adding that what was done was “appropriate” and done “under council direction.”

‘Learning experience’

Gleason expressed several more concerns regarding the handling of the OMA as well as the pension plan, but said he appreciated Rainer’s response.

“We should use this as a learning experience,” he said. “I’m glad this is out on the table. It’s transparent at this point. But we could consider codifying the pension plan at this point — putting it into an ordinance. This is out of the closet, if you will.”

Town Council President Kevin Aguiar said “the process may not have been perfect, but the process is getting better. I assure you, the pension’s closed.”

Both Fitzmorris and Grieb said they supported Gleason’s idea of codifying the pension plan under a town ordinance. 

The most important thing, Fitzmorris said, “is a full understanding of what the actual cost of this thing is going to be.” He also suggested that the town hold quarterly meetings of the pension committee, with full transparency to the public.

“It’s crystal clear that things were not handled with transparency before this,” said Grieb, who contended that “at least three” school employees were added to the pension plan after it was closed.

“Inadvertently or with malice of forethought … things have not been done properly with the pension,” Grieb said, while calling for a full audit of the pension plan “to assure everything’s hunky dory.”

Council member Leonard Katzman said no action regarding a pension plan ordinance could be taken Monday night since it was not on the agenda.

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Meet our staff
Jim McGaw

A lifelong Portsmouth resident, Jim graduated from Portsmouth High School in 1982 and earned a journalism degree from the University of Rhode Island in 1986. He's worked two different stints at East Bay Newspapers, for a total of 18 years with the company so far. When not running all over town bringing you the news from Portsmouth, Jim listens to lots and lots and lots of music, watches obscure silent films from the '20s and usually has three books going at once. He also loves to cook crazy New Orleans dishes for his wife of 25 years, Michelle, and their two sons, Jake and Max.