What We Have Come To Expect.
Last week we gave kudos to Speaker Mattiello for his concern regarding the recent pension settlement and the potential ramifications it would have on defining future changes to the statute governing the state-run pension plans. But this week, we are appalled at his response to a conflict of interest. Speaker Matteillo rents space to the Cranston Firefighters Union Local 1633, but says he keeps his business interests and his votes in the state legislature separate. If his votes are separate, try telling that to the Coventry fire district residents. Mattiello was the sole sponsor of H 7944, a bill mandating that fire districts fall under the fiscal overseer. The General Assembly voted to step in rather than let the fire district go bankrupt, as its taxpaying residents demanded. If you have followed that multi-year issue, you know that the taxpayers' voice was silenced over and over and over again, in favor of trying to keep the firefighter union afloat. That required the General Assembly to ride in with new legislation that allowed the state's budget commission to take over and Speaker Mattiello was at the helm. Speaker Mattiello also allowed a floor vote and personally voted for H 7776 last year, a bill which bailed out the bankrupt public union pension system in Central Falls, which also included firefighters. Your state tax dollars stretching to cover another city's obligations.
And of course, there are the very controversial firefighter bills in the General Assembly this year (H 5473 and S 533). For those who haven't followed the North Kingstown win against the firefighter's union, here's the quick history. The town wanted to implement a management decision to change the platoon structure, which would change the work schedule for the town's firefighters. Nearly 2/3 of the country utilizes the 3 platoon system and North Kingstown estimated a $2 million savings. The taxpayers of North Kingstown were very happy. Finally, after a couple of years and many thousands of dollars, the town won the right to change the firefighter's schedule. The RI Supreme Court said the town has management responsibility for the fire department. After all, isn't that why we have local elections to begin with? We elect leaders to make management decisions about how our taxpayer dollars are spent. And, if we don't like the result, we elect someone else. It's called accountability.
But, as we explained in a recent Alert, public union members sitting in the House have proposed a bill to reverse that Supreme Court decision and to mandate that the work schedule and platoon structure be included in collective bargaining and therefore be subject to binding arbitration. This bill is nothing more than a 'protect special interest' bill, all at the cost of the taxpayer, and at the cost of democracy. This bill will be where the rubber meets the road with Speaker Mattiello. Clearly, if it passes, it will represent a special interest bill - particularly to Speaker Mattiello's wallet.
On the same subject of conflict of interest, perhaps this very special relationship between the Speaker's wallet and the firefighters' union (along with the annual campaign contributions Mattiello receives from various firefighter unions across the state) is the reason he doesn't think the Ethics Reform bill should take front and center spotlight. We at OSTPA believe this is exactly why Ethics Reform needs to be passed and it needs to be passed today.
Did we mention that the Cranston firefighters want to move their pension plan from the state-run system back to a city-run system? According to a recent GoLocalProv article, that would require approval by the state. Any potential conflict of interest there?
And one last item on the conflict of interest agenda. Speaker Mattiello hired a consultant recently, to provide an analysis to the House on which to make a decision about the PawSox Stadium. The consultant, Andrew Zimbalist, hired at $225 an hour, has worked the last 10 years as a consultant for the Baseball Commissioner's Office. Neither Andrew nor the Speaker views this as a conflict of interest. What is your opinion? Please email the Speaker and let him know how you feel about any or all of these conflicts-of-interest and whether or not you believe the Ethics Reform bill, proposed by Senator Ed O'Neill, should be the first substantial piece of legislation that passes in the 2015 session.
We Are Past the Half-Way Mark.
More than 2/3 of the way through the 2015 session, and there has been no substantial, constructive legislation passed. Take the fraud, waste and abuse in the EBT card. How long has that story been around? Well, turnto10.com had yet another story regarding welfare spending in casinos, liquor stores, bars and
hotels and many times, in other states. Yet Representative Morgan's bills to address EBT fraud and Medicaid fraud sit idly in further study land.
How many years would you expect it to take to study the issue of spending welfare money outside of the state? Why does our General Assembly leadership refuse to implement legislation that is only aimed at ensuring honest use of your tax dollars for those receiving welfare benefits?
The RI Center for Freedom and Prosperity has met with elected leaders to address the issue of Medicaid fraud in the form of eligibility verification of Medicaid recipients, a big problem across the country in the wake of Obama's Medicaid expansion. But RI's own Ken Block prepared a report that identified the same types of issues. Those issues were swept under the rug. We hope that the Center's effort to bring in an outside perspective will serve to light a fire on the issue of all welfare fraud, waste and abuse and lead to legislation to stop the wasteful spending of your money and ours.
What is sad is that our young people are witness to all of this fraud, waste and abuse. A 20 year old Providence College student, residing in Maine, once wrote about the abuses she saw while working in a Maine Walmart. These are the same abuses that are reported in the news in RI year after year. But when a young person witnesses this, doesn't this impact the way they see the world? We need to start changing that in RI, for both the taxpayer and the youth of our state.
Another Blow Dealt to RI's Fragile Image.
When an investment management company rates a state's bonds as "sell", it cannot be seen as a good thing for the expectations of RI's future economy. While the recent article on the decision of Gurtin Fixed Income Management to carry that rating into a second year highlights that firms' perspective of the 38Studios deal, is there any doubt that it also sees no end in sight to our economic troubles?
"We believe the state's other more chronic problems pose a heightened level of credit risk". A demonstrative statement about RI's economy. But more than that, it is a statement about the cumulative problems where elected officials only nibble around the edges - the fraud and abuse in welfare and Medicaid, the ballooning unfunded public pensions and OPEB liabilities, the bloated public salaries, the cost of illegal immigration, the cost of inexplicable projects (as noted in the Valley Breeze article by Tom Ward) like the Narragansett Bay Commission's $815 million sewer project or the DeepWater wind turbine project for $451 million. Maybe it's the fact that we never got to the bottom of the 38Studios debacle, or that former Speaker Fox pled guilty to corruption, both acts helping sustain the claims of corruption and conflicts of interest at the highest levels.
But in the end, perhaps it is the responses to questions directly from our leaders. Like saying that renting space to an organization does not count as a conflict of interest, after previously saying Ethics Reform is not on the table.
Or telling the public to stop equating the PawSox deal with the 38Studios deal when we all know it is very much like the 38Studios deal. While they are different kinds of ventures, no one wanted to touch 38Studios with a 10 foot pole and experts are telling us that those who have touched minor league baseball stadiums with a 10 foot pole have not reaped much in the way of net benefits, certainly not to the tune of $120 plus million. Seems like one glib response after another.
What's Going on at the State House This Week?
Nothing substantive or consequential. Nothing that will help change the course of RI's economic trajectory.
Legislative Hearings 5/12/15 - 5/14/15
TUE, MAY 12
Room 313, rise (4:30pm)
S 54 Exempts fire districts with no tax and/or policy making authority from certain posting requirements of the open meetings act.
Sponsors: Pearson, Felag, Sosnowski and Ottiano
S 624 Creates the joint committee of the repealer for a 5 year term.
Sponsors: Lynch, Lombardi, Jabour, Archambault and Conley
THU, MAY 14
Room 211, rise (4:30 pm)
S 740 Requires state agencies and public corporations establish adequate internal control structure, financial reporting policies and procedures to reduce fraud and errors in state programs.
Sponsors: DiPalma, DaPonte, Ottiano, E. O'Neill and Pichardo
TUE, MAY 12
Room 35, 2:00 pm
- Dept. of Environmental Management
- Coastal Resource Management Council
WED, MAY 13
Room 35, 1:00 pm
- Executive Office of Health and Human Services