PROVIDENCE, R.I. (AP) - An influential rating agency is praising a proposed settlement in the legal challenge to Rhode Island’s landmark pension overhaul.
Moody’s Investors Service said on Monday that the deal would be a “credit positive” for the state and its cities because it “only modestly” reduces government savings from the 2011 law.
The settlement was announced this month as a way to resolve legal challenges filed by public-sector unions and retirees.
The deal would roll back some of the law’s changes and give retirees modest pension increases. It would increase annual government pension costs, beginning with $24 million more in fiscal year 2016.
Moody’s says the increases are a fraction of the billions of dollars the law will save in future decades.
The settlement must be approved by unions, retirees and state lawmakers.
Please read our comment policy before commenting.