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Rhode Island Pension Move May Inspire Other States, Fitch Says (Bloomberg Businessweek)

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Thirty-three states have pension programs that hold less than 80 percent of the assets needed in order to pay out benefits over the next several decades, Rhode Island among them. Within the week, Governor Lincoln Chaffee is expected to sign a bill approving changes to the Ocean State’s pension plan, which will involve moving to a hybrid defined benefit/defined contribution plan estimated to reduce the state’s unfunded pension obligation by $3 bilion, to $4.3 billion. Changes will take effect in the fiscal year starting July 1, and, according to a report released by Fitch Ratings earlier today, may spur other states to take similar action.