The Mayor of Providence, RI, recently proposed overhauling retiree pension benefits as a means of staving off bankruptcy.
According to media reports, proposals included an across-the-board suspension of COLA increases, and asked retirees 65 and older to agree to be shifted to Medicare and to pay 20 percent of their health benefits.
Those changes alone would make up more than the $22.5 million annual budget deficit.
If not agreed to by retirees, the Mayor warned of the bankruptcy in nearby Central Falls, RI where pensions were cut by 55%. Providence could see benefits cut by more than 70% if bankruptcy were to occur.
The city is seeking other remedies for the budget shortfall, including voluntary payments from tax-exempt organizations like Brown University.
Read the original article at Boston.com, or review the terms of the pension reform agreement