Tuesday, March 08, 2016
Russell J. Moore, GoLocal Contributor
It's been five years since the state of Rhode Island enacted its monumental pension reform. Afterwards, there were at least three bull market years. Despite that, the state of Rhode Island's pension fund today finds itself exactly where it was five years ago...
"The significant factors are the level of contributions and calculation of ARC and the cost of benefits. The state is in a negative cash flow condition. If there were zero investment returns the fund would decline, because they are paying out more than they are taking in," said Riley.[Michael Riley, a finance professional from Narragansett who is a partner at Beach Street Financial Services and also writes MINDSETTER columns for GoLocalprov.com]
"Just because they made a return doesn't mean there will be more money in the fund over time..."
That doesn't mean Riley agrees with the management of the Rhode Island pension.
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