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| 4 | 4 | | |
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| 5 | 5 | | 2025 -- H 5525 |
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| 6 | 6 | | ======== |
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| 7 | 7 | | LC001302 |
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| 8 | 8 | | ======== |
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| 9 | 9 | | S T A T E O F R H O D E I S L A N D |
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| 10 | 10 | | IN GENERAL ASSEMBLY |
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| 11 | 11 | | JANUARY SESSION, A.D. 2025 |
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| 12 | 12 | | ____________ |
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| 13 | 13 | | |
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| 14 | 14 | | A N A C T |
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| 15 | 15 | | RELATING TO PUBLIC OFFICERS AND EMPLOYEES -- TEACHERS' AND STATE |
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| 16 | 16 | | EMPLOYEES RETIREMENT |
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| 17 | 17 | | Introduced By: Representatives Serpa, Ackerman, Read, Noret, Fellela, Donovan, |
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| 18 | 18 | | Caldwell, Azzinaro, Potter, and Corvese |
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| 19 | 19 | | Date Introduced: February 13, 2025 |
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| 20 | 20 | | Referred To: House Finance |
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| 21 | 21 | | |
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| 22 | 22 | | |
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| 23 | 23 | | It is enacted by the General Assembly as follows: |
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| 24 | 24 | | SECTION 1. Section 16-16-40 of the General Laws in Chapter 16-16 entitled "Teachers’ 1 |
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| 25 | 25 | | Retirement [See Title 16 Chapter 97 — The Rhode Island Board of Education Act]" is hereby 2 |
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| 26 | 26 | | amended to read as follows: 3 |
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| 27 | 27 | | 16-16-40. Additional benefits payable to retired teachers. 4 |
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| 28 | 28 | | (a) All teachers and all beneficiaries of teachers receiving any service retirement or 5 |
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| 29 | 29 | | ordinary or accidental disability retirement allowance pursuant to the provisions of this chapter and 6 |
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| 30 | 30 | | chapter 17 of this title, on or before December 31, 1967, shall receive a cost of living retirement 7 |
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| 31 | 31 | | adjustment equal to one and one-half percent (1.5%) per year of the original retirement allowance, 8 |
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| 32 | 32 | | not compounded, for each year the retirement allowance has been in effect. For purposes of 9 |
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| 33 | 33 | | computation credit shall be given for a full calendar year regardless of the effective date of the 10 |
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| 34 | 34 | | retirement allowance. This cost of living retirement adjustment shall be added to the amount of the 11 |
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| 35 | 35 | | service retirement allowance as of January 1, 1970, and payment shall begin as of July 1, 1970. An 12 |
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| 36 | 36 | | additional cost of living retirement adjustment shall be added to the original retirement allowance 13 |
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| 37 | 37 | | equal to three percent (3%) of the original retirement allowance on the first day of January, 1971, 14 |
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| 38 | 38 | | and each year thereafter through December 31, 1980. 15 |
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| 39 | 39 | | (b) All teachers and beneficiaries of teachers receiving any service retirement or ordinary 16 |
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| 40 | 40 | | disability retirement allowance pursuant to the provisions of this title who retired on or after January 17 |
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| 41 | 41 | | 1, 1968, shall, on the first day of January, next following the third (3rd) year on retirement, receive 18 |
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| 42 | 42 | | |
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| 43 | 43 | | |
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| 44 | 44 | | LC001302 - Page 2 of 12 |
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| 45 | 45 | | a cost of living adjustment, in addition to their retirement allowance, an amount equal to three 1 |
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| 46 | 46 | | percent (3%) of the original retirement allowance. In each succeeding year thereafter, on the first 2 |
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| 47 | 47 | | day of January, the retirement allowance shall be increased an additional three percent (3%) of the 3 |
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| 48 | 48 | | original retirement allowance, not compounded, to be continued through December 31, 1980. 4 |
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| 49 | 49 | | (c)(1) Beginning on January 1, 1981, for all teachers and beneficiaries of teachers receiving 5 |
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| 50 | 50 | | any service retirement and all teachers and all beneficiaries of teachers who have completed at least 6 |
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| 51 | 51 | | ten (10) years of contributory service on or before July 1, 2005, pursuant to the provisions of this 7 |
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| 52 | 52 | | chapter, and for all teachers and beneficiaries of teachers who receive a disability retirement 8 |
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| 53 | 53 | | allowance pursuant to §§ 16-16-14 — 16-16-17, the cost of living adjustment shall be computed 9 |
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| 54 | 54 | | and paid at the rate of three percent (3%) of the original retirement allowance or the retirement 10 |
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| 55 | 55 | | allowance as computed in accordance with § 16-16-40.1, compounded annually from the year for 11 |
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| 56 | 56 | | which the cost of living adjustment was determined to be payable by the retirement board pursuant 12 |
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| 57 | 57 | | to the provisions of subsection (a) or (b) of this section. Such cost of living adjustments are available 13 |
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| 58 | 58 | | to teachers who retire before October 1, 2009, or are eligible to retire as of September 30, 2009. 14 |
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| 59 | 59 | | (2) The provisions of this subsection shall be deemed to apply prospectively only and no 15 |
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| 60 | 60 | | retroactive payment shall be made. 16 |
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| 61 | 61 | | (3) The retirement allowance of all teachers and all beneficiaries of teachers who have not 17 |
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| 62 | 62 | | completed at least ten (10) years of contributory service on or before July 1, 2005, or were not 18 |
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| 63 | 63 | | eligible to retire as of September 30, 2009, shall, on the month following the third anniversary date 19 |
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| 64 | 64 | | of the retirement, and on the month following the anniversary date of each succeeding year be 20 |
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| 65 | 65 | | adjusted and computed by multiplying the retirement allowance by three percent (3%) or the 21 |
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| 66 | 66 | | percentage of increase in the Consumer Price Index for All Urban Consumers (CPI-U) as published 22 |
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| 67 | 67 | | by the United States Department of Labor Statistics, determined as of September 30 of the prior 23 |
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| 68 | 68 | | calendar year, whichever is less; the cost of living adjustment shall be compounded annually from 24 |
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| 69 | 69 | | the year for which the cost of living adjustment was determined payable by the retirement board; 25 |
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| 70 | 70 | | provided, that no adjustment shall cause any retirement allowance to be decreased from the 26 |
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| 71 | 71 | | retirement allowance provided immediately before such adjustment. 27 |
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| 72 | 72 | | (d) For teachers not eligible to retire in accordance with this chapter as of September 30, 28 |
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| 73 | 73 | | 2009, and not eligible upon passage of this article, and for their beneficiaries, the cost of living 29 |
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| 74 | 74 | | adjustment described in subsection (c)(3) of this section shall only apply to the first thirty-five 30 |
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| 75 | 75 | | thousand dollars ($35,000) of retirement allowance, indexed annually, and shall commence upon 31 |
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| 76 | 76 | | the third (3rd) anniversary of the date of retirement or when the retiree reaches age sixty-five (65), 32 |
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| 77 | 77 | | whichever is later. The thirty-five thousand dollar ($35,000) limit shall increase annually by the 33 |
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| 78 | 78 | | percentage increase in the Consumer Price Index for All Urban Consumers (CPI-U) as published 34 |
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| 79 | 79 | | |
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| 80 | 80 | | |
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| 81 | 81 | | LC001302 - Page 3 of 12 |
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| 82 | 82 | | by the United States Department of Labor Statistics determined as of September 30 of the prior 1 |
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| 83 | 83 | | calendar year or three percent (3%), whichever is less. The first thirty-five thousand dollars 2 |
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| 84 | 84 | | ($35,000), as indexed, of retirement allowance shall be multiplied by the percentage of increase in 3 |
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| 85 | 85 | | the Consumer Price Index for All Urban Consumers (CPI-U) as published by the United States 4 |
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| 86 | 86 | | Department of Labor Statistics determined as of September 30 of the prior calendar year or three 5 |
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| 87 | 87 | | percent (3%), whichever is less, on the month following the anniversary date of each succeeding 6 |
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| 88 | 88 | | year. For teachers eligible to retire as of September 30, 2009, or eligible upon passage of this article, 7 |
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| 89 | 89 | | and for their beneficiaries, the provisions of this subsection (d) shall not apply. 8 |
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| 90 | 90 | | (e) The provisions of §§ 45-13-7 — 45-13-10 shall not apply to this section. 9 |
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| 91 | 91 | | (f) This subsection (f) shall be effective for the period July 1, 2012, through June 30, 2015. 10 |
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| 92 | 92 | | (1) Notwithstanding the prior paragraphs of this section, and subject to subsection (f)(2) 11 |
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| 93 | 93 | | below, for all present and former teachers, active and retired teachers, and beneficiaries receiving 12 |
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| 94 | 94 | | any retirement, disability or death allowance or benefit of any kind, the annual benefit adjustment 13 |
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| 95 | 95 | | provided in any calendar year under this section shall be equal to (A) multiplied by (B) where (A) 14 |
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| 96 | 96 | | is equal to the percentage determined by subtracting five and one-half percent (5.5%) (the 15 |
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| 97 | 97 | | “subtrahend”) from the Five-Year Average Investment Return of the retirement system determined 16 |
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| 98 | 98 | | as of the last day of the plan year preceding the calendar year in which the adjustment is granted, 17 |
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| 99 | 99 | | said percentage not to exceed four percent (4%) and not to be less than zero percent (0%), and (B) 18 |
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| 100 | 100 | | is equal to the lesser of the teacher’s retirement allowance or the first twenty-five thousand dollars 19 |
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| 101 | 101 | | ($25,000) of retirement allowance, such twenty-five thousand dollars ($25,000) amount to be 20 |
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| 102 | 102 | | indexed annually in the same percentage as determined under (f)(1)(A) above. The “Five-Year 21 |
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| 103 | 103 | | Average Investment Return” shall mean the average of the investment returns of the most recent 22 |
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| 104 | 104 | | five (5) plan years as determined by the retirement board. Subject to subsection (f)(2) below, the 23 |
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| 105 | 105 | | benefit adjustment provided by this subsection (f)(1) shall commence upon the third (3rd) 24 |
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| 106 | 106 | | anniversary of the date of retirement or the date on which the retiree reaches their Social Security 25 |
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| 107 | 107 | | retirement age, whichever is later. In the event the retirement board adjusts the actuarially assumed 26 |
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| 108 | 108 | | rate of return for the system, either upward or downward, the subtrahend shall be adjusted either 27 |
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| 109 | 109 | | upward or downward in the same amount. 28 |
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| 110 | 110 | | (2) Except as provided in subsection (f)(3), the benefit adjustments under this section for 29 |
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| 111 | 111 | | any plan year shall be suspended in their entirety unless the funded ratio of the employees’ 30 |
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| 112 | 112 | | retirement system of Rhode Island, the judicial retirement benefits trust, and the state police 31 |
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| 113 | 113 | | retirement benefits trust, calculated by the system’s actuary on an aggregate basis, exceeds eighty 32 |
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| 114 | 114 | | percent (80%) in which event the benefit adjustment will be reinstated for all teachers for such plan 33 |
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| 115 | 115 | | year. 34 |
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| 116 | 116 | | |
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| 117 | 117 | | |
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| 118 | 118 | | LC001302 - Page 4 of 12 |
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| 119 | 119 | | In determining whether a funding level under this subsection (f)(2) has been achieved, the 1 |
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| 120 | 120 | | actuary shall calculate the funding percentage after taking into account the reinstatement of any 2 |
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| 121 | 121 | | current or future benefit adjustment provided under this section. 3 |
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| 122 | 122 | | (3) Notwithstanding subsection (f)(2), in each fifth plan year commencing after June 30, 4 |
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| 123 | 123 | | 2012, commencing with the plan year ending June 30, 2017, and subsequently at intervals of five 5 |
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| 124 | 124 | | plan years, a benefit adjustment shall be calculated and made in accordance with subsection (f)(1) 6 |
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| 125 | 125 | | above until the funded ratio of the employees’ retirement system of Rhode Island, the judicial 7 |
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| 126 | 126 | | retirement benefits trust, and the state police retirement benefits trust, calculated by the system’s 8 |
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| 127 | 127 | | actuary on an aggregate basis, exceeds eighty percent (80%). 9 |
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| 128 | 128 | | (4) Notwithstanding any other provisions of this chapter, the provisions of this subsection 10 |
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| 129 | 129 | | (f) shall become effective July 1, 2012, and shall apply to any benefit adjustments not granted on 11 |
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| 130 | 130 | | or prior to June 30, 2012. 12 |
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| 131 | 131 | | (g) This subsection (g) shall become effective July 1, 2015. 13 |
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| 132 | 132 | | (1)(A) As soon as administratively reasonable following the enactment into law of this 14 |
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| 133 | 133 | | subsection (g)(1)(A), a one-time benefit adjustment shall be provided to teachers and/or 15 |
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| 134 | 134 | | beneficiaries of teachers who retired on or before June 30, 2012, in the amount of two percent (2%) 16 |
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| 135 | 135 | | of the lesser of either the teacher’s retirement allowance or the first twenty-five thousand dollars 17 |
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| 136 | 136 | | ($25,000) of the teacher’s retirement allowance. This one-time benefit adjustment shall be provided 18 |
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| 137 | 137 | | without regard to the retiree’s age or number of years since retirement. 19 |
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| 138 | 138 | | (B) Notwithstanding the prior subsections of this section, for all present and former 20 |
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| 139 | 139 | | teachers, active and retired teachers, and beneficiaries receiving any retirement, disability, or death 21 |
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| 140 | 140 | | allowance or benefit of any kind, the annual benefit adjustment provided in any calendar year under 22 |
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| 141 | 141 | | this section for adjustments on and after January 1, 2016, and subject to subsection (g)(2) below, 23 |
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| 142 | 142 | | shall be equal to (I) multiplied by (II): 24 |
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| 143 | 143 | | (I) shall equal the sum of fifty percent (50%) of (i) plus fifty percent (50%) of (ii) where: 25 |
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| 144 | 144 | | (i) is equal to the percentage determined by subtracting five and one-half percent (5.5%) 26 |
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| 145 | 145 | | (the “subtrahend”) from the five-year average investment return of the retirement system 27 |
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| 146 | 146 | | determined as of the last day of the plan year preceding the calendar year in which the adjustment 28 |
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| 147 | 147 | | is granted, said percentage not to exceed four percent (4%) and not to be less than zero percent 29 |
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| 148 | 148 | | (0%). The “five-year average investment return” shall mean the average of the investment returns 30 |
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| 149 | 149 | | of the most recent five (5) plan years as determined by the retirement board. In the event the 31 |
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| 150 | 150 | | retirement board adjusts the actuarially assumed rate of return for the system, either upward or 32 |
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| 151 | 151 | | downward, the subtrahend shall be adjusted either upward or downward in the same amount. 33 |
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| 152 | 152 | | (ii) is equal to the lesser of three percent (3%) or the percentage increase in the Consumer 34 |
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| 153 | 153 | | |
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| 154 | 154 | | |
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| 155 | 155 | | LC001302 - Page 5 of 12 |
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| 156 | 156 | | Price Index for All Urban Consumers (CPI-U) as published by the U.S. Department of Labor 1 |
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| 157 | 157 | | Statistics determined as of September 30 of the prior calendar year. 2 |
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| 158 | 158 | | In no event shall the sum of (i) plus (ii) exceed three and one-half percent (3.5%) or be less 3 |
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| 159 | 159 | | than (0%) percent. 4 |
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| 160 | 160 | | (II) is equal to the lesser of either the teacher’s retirement allowance or the first twenty-5 |
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| 161 | 161 | | five thousand eight hundred and fifty-five dollars ($25,855) of retirement allowance, such amount 6 |
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| 162 | 162 | | to be indexed annually in the same percentage as determined under subsection (g)(1)(B)(I) above. 7 |
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| 163 | 163 | | The benefit adjustments provided by this subsection (g)(1)(B) shall be provided to all 8 |
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| 164 | 164 | | retirees entitled to receive a benefit adjustment as of June 30, 2012, under the law then in effect, 9 |
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| 165 | 165 | | and for all other retirees the benefit adjustments shall commence upon the third anniversary of the 10 |
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| 166 | 166 | | date of retirement or the date on which the retiree reaches his or her Social Security retirement age, 11 |
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| 167 | 167 | | whichever is later. 12 |
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| 168 | 168 | | (2) Except for teachers and/or beneficiaries of teachers who retired on or before June 30, 13 |
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| 169 | 169 | | 2012, have been retired for more than three (3) full calendar years, the benefit adjustments under 14 |
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| 170 | 170 | | subsection (g)(1)(B) for any plan year shall be reduced to twenty-five percent (25%) of the benefit 15 |
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| 171 | 171 | | adjustment unless the funded ratio of the employees’ retirement system of Rhode Island, the judicial 16 |
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| 172 | 172 | | retirement benefits trust, and the state police retirement benefits trust, calculated by the system’s 17 |
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| 173 | 173 | | actuary on an aggregate basis, exceeds eighty percent (80%) in which event the benefit adjustment 18 |
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| 174 | 174 | | will be reinstated for all teachers for such plan year. Effective July 1, 2024, the funded ratio of the 19 |
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| 175 | 175 | | employees’ retirement system of Rhode Island, the judicial retirement benefits trust, and the state 20 |
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| 176 | 176 | | police retirement benefits trust, calculated by the system’s actuary on an aggregate basis, of 21 |
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| 177 | 177 | | exceeding eighty percent (80%) for the benefit adjustment to be reinstated for all teachers for such 22 |
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| 178 | 178 | | plan year shall be replaced with seventy-five percent (75%). 23 |
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| 179 | 179 | | In determining whether a funding level under this subsection (g)(2) has been achieved, the 24 |
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| 180 | 180 | | actuary shall calculate the funding percentage after taking into account the reinstatement of any 25 |
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| 181 | 181 | | current or future benefit adjustment provided under this section. 26 |
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| 182 | 182 | | (3) Effective for teachers and/or beneficiaries of teachers who retired after June 30, 2012, 27 |
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| 183 | 183 | | or on or before June 30, 2015, the dollar amount in subsection (g)(1)(B)(II) of twenty-five thousand 28 |
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| 184 | 184 | | eight hundred and fifty-five dollars ($25,855) shall be replaced with thirty-one thousand and 29 |
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| 185 | 185 | | twenty-six dollars ($31,026) until the funded ratio of the employees’ retirement system of Rhode 30 |
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| 186 | 186 | | Island, the judicial retirement benefits trust, and the state police retirement benefits trust, calculated 31 |
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| 187 | 187 | | by the system’s actuary on an aggregate basis, exceeds eighty percent (80%). Effective July 1, 32 |
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| 188 | 188 | | 2024, the funded ratio of the employees’ retirement system of Rhode Island, the judicial retirement 33 |
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| 189 | 189 | | benefits trust, and the state police retirement benefits trust, calculated by the system’s actuary on 34 |
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| 190 | 190 | | |
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| 191 | 191 | | |
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| 192 | 192 | | LC001302 - Page 6 of 12 |
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| 193 | 193 | | an aggregate basis, of exceeding eighty percent (80%) shall be replaced with seventy-five percent 1 |
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| 194 | 194 | | (75%). 2 |
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| 195 | 195 | | (4) Effective for teachers and/or beneficiaries of teachers who have retired on or before 3 |
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| 196 | 196 | | July 1, 2015, a one-time stipend of five hundred dollars ($500) shall be payable within sixty (60) 4 |
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| 197 | 197 | | days following the enactment of the legislation implementing this provision, and a second one-time 5 |
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| 198 | 198 | | stipend of five hundred dollars ($500) in the same month of the following year. These stipends 6 |
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| 199 | 199 | | shall be payable to all retired teachers or beneficiaries receiving a benefit as of the applicable 7 |
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| 200 | 200 | | payment date and shall not be considered cost of living adjustments under the prior provisions of 8 |
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| 201 | 201 | | this section. 9 |
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| 202 | 202 | | SECTION 2. Section 36-10-35 of the General Laws in Chapter 36-10 entitled "Retirement 10 |
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| 203 | 203 | | System — Contributions and Benefits" is hereby amended to read as follows: 11 |
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| 204 | 204 | | 36-10-35. Additional benefits payable to retired employees. 12 |
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| 205 | 205 | | (a) All state employees and all beneficiaries of state employees receiving any service 13 |
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| 206 | 206 | | retirement or ordinary or accidental disability retirement allowance pursuant to the provisions of 14 |
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| 207 | 207 | | this title on or before December 31, 1967, shall receive a cost of living retirement adjustment equal 15 |
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| 208 | 208 | | to one and one-half percent (1.5%) per year of the original retirement allowance, not compounded, 16 |
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| 209 | 209 | | for each calendar year the retirement allowance has been in effect. For the purposes of computation, 17 |
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| 210 | 210 | | credit shall be given for a full calendar year regardless of the effective date of the retirement 18 |
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| 211 | 211 | | allowance. This cost of living adjustment shall be added to the amount of the retirement allowance 19 |
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| 212 | 212 | | as of January 1, 1968, and an additional one and one-half percent (1.5%) shall be added to the 20 |
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| 213 | 213 | | original retirement allowance in each succeeding year during the month of January, and provided 21 |
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| 214 | 214 | | further, that this additional cost of living increase shall be three percent (3%) for the year beginning 22 |
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| 215 | 215 | | January 1, 1971, and each year thereafter, through December 31, 1980. Notwithstanding any of the 23 |
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| 216 | 216 | | above provisions, no employee receiving any service retirement allowance pursuant to the 24 |
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| 217 | 217 | | provisions of this title on or before December 31, 1967, or the employee’s beneficiary, shall receive 25 |
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| 218 | 218 | | any additional benefit hereunder in an amount less than two hundred dollars ($200) per year over 26 |
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| 219 | 219 | | the service retirement allowance where the employee retired prior to January 1, 1958. 27 |
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| 220 | 220 | | (b) All state employees and all beneficiaries of state employees retired on or after January 28 |
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| 221 | 221 | | 1, 1968, who are receiving any service retirement or ordinary or accidental disability retirement 29 |
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| 222 | 222 | | allowance pursuant to the provisions of this title shall, on the first day of January next following 30 |
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| 223 | 223 | | the third anniversary date of the retirement, receive a cost of living retirement adjustment, in 31 |
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| 224 | 224 | | addition to their retirement allowance, in an amount equal to three percent (3%) of the original 32 |
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| 225 | 225 | | retirement allowance. In each succeeding year thereafter through December 31, 1980, during the 33 |
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| 226 | 226 | | month of January, the retirement allowance shall be increased an additional three percent (3%) of 34 |
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| 227 | 227 | | |
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| 228 | 228 | | |
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| 229 | 229 | | LC001302 - Page 7 of 12 |
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| 230 | 230 | | the original retirement allowance, not compounded, to be continued during the lifetime of the 1 |
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| 231 | 231 | | employee or beneficiary. For the purposes of computation, credit shall be given for a full calendar 2 |
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| 232 | 232 | | year regardless of the effective date of the service retirement allowance. 3 |
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| 233 | 233 | | (c)(1) Beginning on January 1, 1981, for all state employees and beneficiaries of the state 4 |
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| 234 | 234 | | employees receiving any service retirement and all state employees, and all beneficiaries of state 5 |
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| 235 | 235 | | employees, who have completed at least ten (10) years of contributory service on or before July 1, 6 |
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| 236 | 236 | | 2005, pursuant to the provisions of this chapter, and for all state employees, and all beneficiaries 7 |
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| 237 | 237 | | of state employees who receive a disability retirement allowance pursuant to §§ 36-10-12 — 36-8 |
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| 238 | 238 | | 10-15, the cost of living adjustment shall be computed and paid at the rate of three percent (3%) of 9 |
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| 239 | 239 | | the original retirement allowance or the retirement allowance as computed in accordance with § 10 |
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| 240 | 240 | | 36-10-35.1, compounded annually from the year for which the cost of living adjustment was 11 |
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| 241 | 241 | | determined to be payable by the retirement board pursuant to the provisions of subsection (a) or (b) 12 |
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| 242 | 242 | | of this section. Such cost of living adjustments are available to members who retire before October 13 |
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| 243 | 243 | | 1, 2009, or are eligible to retire as of September 30, 2009. 14 |
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| 244 | 244 | | (2) The provisions of this subsection shall be deemed to apply prospectively only and no 15 |
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| 245 | 245 | | retroactive payment shall be made. 16 |
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| 246 | 246 | | (3) The retirement allowance of all state employees and all beneficiaries of state employees 17 |
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| 247 | 247 | | who have not completed at least ten (10) years of contributory service on or before July 1, 2005, or 18 |
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| 248 | 248 | | were not eligible to retire as of September 30, 2009, shall, on the month following the third 19 |
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| 249 | 249 | | anniversary date of retirement, and on the month following the anniversary date of each succeeding 20 |
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| 250 | 250 | | year be adjusted and computed by multiplying the retirement allowance by three percent (3%) or 21 |
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| 251 | 251 | | the percentage of increase in the Consumer Price Index for All Urban Consumers (CPI-U) as 22 |
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| 252 | 252 | | published by the United States Department of Labor Statistics determined as of September 30 of 23 |
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| 253 | 253 | | the prior calendar year, whichever is less; the cost of living adjustment shall be compounded 24 |
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| 254 | 254 | | annually from the year for which the cost of living adjustment was determined payable by the 25 |
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| 255 | 255 | | retirement board; provided, that no adjustment shall cause any retirement allowance to be decreased 26 |
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| 256 | 256 | | from the retirement allowance provided immediately before such adjustment. 27 |
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| 257 | 257 | | (d) For state employees not eligible to retire in accordance with this chapter as of 28 |
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| 258 | 258 | | September 30, 2009, and not eligible upon passage of this article, and for their beneficiaries, the 29 |
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| 259 | 259 | | cost of living adjustment described in subsection (c)(3) of this section shall only apply to the first 30 |
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| 260 | 260 | | thirty-five thousand dollars ($35,000) of retirement allowance, indexed annually, and shall 31 |
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| 261 | 261 | | commence upon the third (3rd) anniversary of the date of retirement or when the retiree reaches 32 |
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| 262 | 262 | | age sixty-five (65), whichever is later. The thirty-five thousand dollar ($35,000) limit shall increase 33 |
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| 263 | 263 | | annually by the percentage increase in the Consumer Price Index for All Urban Consumers (CPI-34 |
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| 264 | 264 | | |
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| 265 | 265 | | |
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| 266 | 266 | | LC001302 - Page 8 of 12 |
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| 267 | 267 | | U) as published by the United States Department of Labor Statistics determined as of September 1 |
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| 268 | 268 | | 30 of the prior calendar year or three percent (3%), whichever is less. The first thirty-five thousand 2 |
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| 269 | 269 | | dollars ($35,000) of retirement allowance, as indexed, shall be multiplied by the percentage of 3 |
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| 270 | 270 | | increase in the Consumer Price Index for All Urban Consumers (CPI-U) as published by the United 4 |
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| 271 | 271 | | States Department of Labor Statistics determined as of September 30 of the prior calendar year or 5 |
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| 272 | 272 | | three percent (3%), whichever is less, on the month following the anniversary date of each 6 |
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| 273 | 273 | | succeeding year. For state employees eligible to retire as of September 30, 2009, or eligible upon 7 |
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| 274 | 274 | | passage of this article, and for their beneficiaries, the provisions of this subsection (d) shall not 8 |
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| 275 | 275 | | apply. 9 |
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| 276 | 276 | | (e) All legislators and all beneficiaries of legislators who are receiving a retirement 10 |
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| 277 | 277 | | allowance pursuant to the provisions of § 36-10-9.1 for a period of three (3) or more years, shall, 11 |
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| 278 | 278 | | commencing January 1, 1982, receive a cost of living retirement adjustment, in addition to a 12 |
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| 279 | 279 | | retirement allowance, in an amount equal to three percent (3%) of the original retirement allowance. 13 |
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| 280 | 280 | | In each succeeding year thereafter during the month of January, the retirement allowance shall be 14 |
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| 281 | 281 | | increased an additional three percent (3%) of the original retirement allowance, compounded 15 |
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| 282 | 282 | | annually, to be continued during the lifetime of the legislator or beneficiary. For the purposes of 16 |
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| 283 | 283 | | computation, credit shall be given for a full calendar year regardless of the effective date of the 17 |
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| 284 | 284 | | service retirement allowance. 18 |
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| 285 | 285 | | (f) The provisions of §§ 45-13-7 — 45-13-10 shall not apply to this section. 19 |
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| 286 | 286 | | (g) This subsection (g) shall be effective for the period July 1, 2012, through June 30, 2015. 20 |
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| 287 | 287 | | (1) Notwithstanding the prior paragraphs of this section, and subject to subsection (g)(2) 21 |
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| 288 | 288 | | below, for all present and former employees, active and retired members, and beneficiaries 22 |
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| 289 | 289 | | receiving any retirement, disability or death allowance or benefit of any kind, the annual benefit 23 |
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| 290 | 290 | | adjustment provided in any calendar year under this section shall be equal to (A) multiplied by (B) 24 |
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| 291 | 291 | | where (A) is equal to the percentage determined by subtracting five and one-half percent (5.5%) 25 |
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| 292 | 292 | | (the “subtrahend”) from the Five-Year Average Investment Return of the retirement system 26 |
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| 293 | 293 | | determined as of the last day of the plan year preceding the calendar year in which the adjustment 27 |
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| 294 | 294 | | is granted, said percentage not to exceed four percent (4%) and not to be less than zero percent 28 |
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| 295 | 295 | | (0%), and (B) is equal to the lesser of the member’s retirement allowance or the first twenty-five 29 |
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| 296 | 296 | | thousand dollars ($25,000) of retirement allowance, such twenty-five thousand dollars ($25,000) 30 |
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| 297 | 297 | | amount to be indexed annually in the same percentage as determined under (g)(1)(A) above. The 31 |
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| 298 | 298 | | “Five-Year Average Investment Return” shall mean the average of the investment returns of the 32 |
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| 299 | 299 | | most recent five (5) plan years as determined by the retirement board. Subject to subsection (g)(2) 33 |
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| 300 | 300 | | below, the benefit adjustment provided by this subsection (g)(1) shall commence upon the third 34 |
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| 301 | 301 | | |
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| 302 | 302 | | |
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| 303 | 303 | | LC001302 - Page 9 of 12 |
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| 304 | 304 | | (3rd) anniversary of the date of retirement or the date on which the retiree reaches their Social 1 |
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| 305 | 305 | | Security retirement age, whichever is later. In the event the retirement board adjusts the actuarially 2 |
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| 306 | 306 | | assumed rate of return for the system, either upward or downward, the subtrahend shall be adjusted 3 |
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| 307 | 307 | | either upward or downward in the same amount. 4 |
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| 308 | 308 | | (2) Except as provided in subsection (g)(3), the benefit adjustments under this section for 5 |
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| 309 | 309 | | any plan year shall be suspended in their entirety unless the funded ratio of the employees’ 6 |
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| 310 | 310 | | retirement system of Rhode Island, the judicial retirement benefits trust, and the state police 7 |
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| 311 | 311 | | retirement benefits trust, calculated by the system’s actuary on an aggregate basis, exceeds eighty 8 |
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| 312 | 312 | | percent (80%) in which event the benefit adjustment will be reinstated for all members for such 9 |
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| 313 | 313 | | plan year. 10 |
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| 314 | 314 | | In determining whether a funding level under this subsection (g)(2) has been achieved, the 11 |
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| 315 | 315 | | actuary shall calculate the funding percentage after taking into account the reinstatement of any 12 |
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| 316 | 316 | | current or future benefit adjustment provided under this section. 13 |
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| 317 | 317 | | (3) Notwithstanding subsection (g)(2), in each fifth plan year commencing after June 30, 14 |
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| 318 | 318 | | 2012, commencing with the plan year ending June 30, 2017, and subsequently at intervals of five 15 |
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| 319 | 319 | | plan years, a benefit adjustment shall be calculated and made in accordance with subsection (g)(1) 16 |
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| 320 | 320 | | above until the funded ratio of the employees’ retirement system of Rhode Island, the judicial 17 |
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| 321 | 321 | | retirement benefits trust, and the state police retirement benefits trust, calculated by the system’s 18 |
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| 322 | 322 | | actuary on an aggregate basis, exceeds eighty percent (80%). 19 |
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| 323 | 323 | | (4) Notwithstanding any other provision of this chapter, the provisions of this subsection 20 |
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| 324 | 324 | | (g) shall become effective July 1, 2012, and shall apply to any benefit adjustment not granted on or 21 |
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| 325 | 325 | | prior to June 30, 2012. 22 |
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| 326 | 326 | | (h) This subsection (h) shall become effective July 1, 2015. 23 |
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| 327 | 327 | | (1)(A) As soon as administratively reasonable following the enactment into law of this 24 |
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| 328 | 328 | | subsection (h)(1)(A), a one-time benefit adjustment shall be provided to members and/or 25 |
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| 329 | 329 | | beneficiaries of members who retired on or before June 30, 2012, in the amount of two percent 26 |
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| 330 | 330 | | (2%) of the lesser of either the member’s retirement allowance or the first twenty-five thousand 27 |
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| 331 | 331 | | dollars ($25,000) of the member’s retirement allowance. This one-time benefit adjustment shall be 28 |
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| 332 | 332 | | provided without regard to the retiree’s age or number of years since retirement. 29 |
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| 333 | 333 | | (B) Notwithstanding the prior subsections of this section, for all present and former 30 |
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| 334 | 334 | | employees, active and retired members, and beneficiaries receiving any retirement, disability or 31 |
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| 335 | 335 | | death allowance or benefit of any kind, the annual benefit adjustment provided in any calendar year 32 |
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| 336 | 336 | | under this section for adjustments on and after January 1, 2016, and subject to subsection (h)(2) 33 |
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| 337 | 337 | | below, shall be equal to (I) multiplied by (II): 34 |
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| 338 | 338 | | |
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| 339 | 339 | | |
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| 340 | 340 | | LC001302 - Page 10 of 12 |
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| 341 | 341 | | (I) shall equal the sum of fifty percent (50%) of (i) plus fifty percent (50%) of (ii) where: 1 |
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| 342 | 342 | | (i) is equal to the percentage determined by subtracting five and one-half percent (5.5%) 2 |
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| 343 | 343 | | (the “subtrahend”) from the five-year average investment return of the retirement system 3 |
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| 344 | 344 | | determined as of the last day of the plan year preceding the calendar year in which the adjustment 4 |
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| 345 | 345 | | is granted, said percentage not to exceed four percent (4%) and not to be less than zero percent 5 |
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| 346 | 346 | | (0%). The “five-year average investment return” shall mean the average of the investment returns 6 |
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| 347 | 347 | | of the most recent five (5) plan years as determined by the retirement board. In the event the 7 |
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| 348 | 348 | | retirement board adjusts the actuarially assumed rate of return for the system, either upward or 8 |
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| 349 | 349 | | downward, the subtrahend shall be adjusted either upward or downward in the same amount. 9 |
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| 350 | 350 | | (ii) is equal to the lesser of three percent (3%) or the percentage increase in the Consumer 10 |
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| 351 | 351 | | Price Index for All Urban Consumers (CPI-U) as published by the U.S. Department of Labor 11 |
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| 352 | 352 | | Statistics determined as of September 30 of the prior calendar year. In no event shall the sum of (i) 12 |
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| 353 | 353 | | plus (ii) exceed three and one-half percent (3.5%) or be less than zero percent (0%). 13 |
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| 354 | 354 | | (II) is equal to the lesser of either the member’s retirement allowance or the first twenty-14 |
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| 355 | 355 | | five thousand eight hundred and fifty-five dollars ($25,855) of retirement allowance, such amount 15 |
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| 356 | 356 | | to be indexed annually in the same percentage as determined under subsection (h)(1)(B)(I) above. 16 |
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| 357 | 357 | | The benefit adjustments provided by this subsection (h)(1)(B) shall be provided to all 17 |
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| 358 | 358 | | retirees entitled to receive a benefit adjustment as of June 30, 2012, under the law then in effect, 18 |
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| 359 | 359 | | and for all other retirees the benefit adjustments shall commence upon the third anniversary of the 19 |
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| 360 | 360 | | date of retirement or the date on which the retiree reaches their Social Security retirement age, 20 |
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| 361 | 361 | | whichever is later. 21 |
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| 362 | 362 | | (2) Except for members and/or beneficiaries of members who retired on or before June 30, 22 |
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| 363 | 363 | | 2012, have been retired for more than three (3) full calendar years, the benefit adjustments under 23 |
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| 364 | 364 | | subsection (h)(1)(B) for any plan year shall be reduced to twenty-five percent (25%) of the benefit 24 |
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| 365 | 365 | | adjustment unless the funded ratio of the employees’ retirement system of Rhode Island, the judicial 25 |
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| 366 | 366 | | retirement benefits trust, and the state police retirement benefits trust, calculated by the system’s 26 |
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| 367 | 367 | | actuary on an aggregate basis, exceeds eighty percent (80%) in which event the benefit adjustment 27 |
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| 368 | 368 | | will be reinstated for all members for such plan year. Effective July 1, 2024, the funded ratio of the 28 |
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| 369 | 369 | | employees’ retirement system of Rhode Island, the judicial retirement benefits trust, and the state 29 |
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| 370 | 370 | | police retirement benefits trust, calculated by the system’s actuary on an aggregate basis, of 30 |
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| 371 | 371 | | exceeding eighty percent (80%) for the benefit adjustment to be reinstated for all members for such 31 |
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| 372 | 372 | | plan year shall be replaced with seventy-five percent (75%). 32 |
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| 373 | 373 | | In determining whether a funding level under this subsection (h)(2) has been achieved, the 33 |
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| 374 | 374 | | actuary shall calculate the funding percentage after taking into account the reinstatement of any 34 |
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| 375 | 375 | | |
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| 376 | 376 | | |
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| 377 | 377 | | LC001302 - Page 11 of 12 |
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| 378 | 378 | | current or future benefit adjustment provided under this section. 1 |
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| 379 | 379 | | (3) Effective for members and/or beneficiaries of members who retired after June 30, 2012, 2 |
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| 380 | 380 | | or on or before June 30, 2015, the dollar amount in subsection (h)(1)(B)(II) of twenty-five thousand 3 |
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| 381 | 381 | | eight hundred and fifty-five dollars ($25,855) shall be replaced with thirty-one thousand and 4 |
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| 382 | 382 | | twenty-six dollars ($31,026) until the funded ratio of the employees’ retirement system of Rhode 5 |
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| 383 | 383 | | Island, the judicial retirement benefits trust, and the state police retirement benefits trust, calculated 6 |
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| 384 | 384 | | by the system’s actuary on an aggregate basis, exceeds eighty percent (80%). Effective July 1, 7 |
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| 385 | 385 | | 2024, the funded ratio of the employees’ retirement system of Rhode Island, the judicial retirement 8 |
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| 386 | 386 | | benefits trust, and the state police retirement benefits trust, calculated by the system’s actuary on 9 |
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| 387 | 387 | | an aggregate basis, of exceeding eighty percent (80%) shall be replaced with seventy-five percent 10 |
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| 388 | 388 | | (75%). 11 |
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| 389 | 389 | | (i) Effective for members and/or beneficiaries of members who have retired on or before 12 |
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| 390 | 390 | | July 1, 2015, a one-time stipend of five hundred dollars ($500) shall be payable within sixty (60) 13 |
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| 391 | 391 | | days following the enactment of the legislation implementing this provision, and a second one-time 14 |
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| 392 | 392 | | stipend of five hundred dollars ($500) in the same month of the following year. These stipends 15 |
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| 393 | 393 | | shall be payable to all retired members or beneficiaries receiving a benefit as of the applicable 16 |
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| 394 | 394 | | payment date and shall not be considered cost of living adjustments under the prior provisions of 17 |
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| 395 | 395 | | this section. 18 |
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| 396 | 396 | | SECTION 3. This act shall take effect upon passage. 19 |
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| 397 | 397 | | ======== |
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| 398 | 398 | | LC001302 |
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| 399 | 399 | | ======== |
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| 400 | 400 | | |
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| 401 | 401 | | |
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| 402 | 402 | | LC001302 - Page 12 of 12 |
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| 403 | 403 | | EXPLANATION |
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| 404 | 404 | | BY THE LEGISLATIVE COUNCIL |
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| 405 | 405 | | OF |
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| 406 | 406 | | A N A C T |
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| 407 | 407 | | RELATING TO PUBLIC OFFICERS AND EMPLOYEES -- TEACHERS' AND STATE |
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| 408 | 408 | | EMPLOYEES RETIREMENT |
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| 409 | 409 | | *** |
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| 410 | 410 | | This act would exempt teachers and state employees who have been retired for more than 1 |
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| 411 | 411 | | three (3) full calendar years, from having their retirement benefit adjustment reduced based upon 2 |
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| 412 | 412 | | the funded ratio of the employees' retirement system of Rhode Island. 3 |
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| 413 | 413 | | This act would take effect upon passage. 4 |
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| 414 | 414 | | ======== |
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| 415 | 415 | | LC001302 |
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| 416 | 416 | | ======== |
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