Judge Rules in Favor of City in Landmark Cranston Pension Reform Lawsuit

CRANSTON, RI—A Superior Court judge has ruled in favor of the city in a landmark pension reform case that Cranston Mayor Allan W. Fung said Friday was a decision of historic proportions.

Superior Court Judge Sarah Taft-Carter has ruled that the historic locally-administered pension reform deal negotiated between the city and a majority of retired police officers and firefighters in 2013 as lawful, reasonble and necessary.

A number of retirees challenged the plan, choosing to op-out and file suit after forming in 2012. The plan deployed a combination of caps on cost of living increases (COLAs), COLA freezes and reduced COLAs over the next 30 years along with a reamortization of a $300-million unfunded liability to save the plan from collapse. City officials said the plan would save tens of millions.

In a more-than 50-page decision released Friday, Taft-Carter said the injunction sought by the Cranston Police Retirees Action Committee on a contract cause claim "fails as a matter of law" and the group lacked standing to bring a breach of contract claim.

Fung said in a statement that "this is a historic day and I am extremely pleased with this decision, which has been a long time coming. I am proud that we were the first government entity in Rhode Island to reform our troubled pension system and have our actions withstand a legal challenge after trial. This decision saves the troubled pension plan, but more importantly, ensures that we did so without unduly burdening our residents with more taxes or deeper cuts in services."

This story is being updated.