The bill establishes a new procedure for granting annual benefit increases to retirees and beneficiaries of the Employees' Retirement System and the Teachers' Retirement System in Alabama, effective October 1, 2026. It stipulates that no benefit increase will be paid unless it is authorized by a separate legislative act that specifies the amount and eligible classes of retirees. Additionally, the annual cost of the increase must be included and appropriated in the respective State General Fund or Education Trust Fund appropriation acts. If the required funding is not appropriated in a given fiscal year, eligible retirees will not receive the increase, although it may be resumed in subsequent years if included in the appropriation act.

The bill also includes legislative findings that assert any benefit increases provided under this act will not increase the unfunded liability of the retirement systems, and it disregards any accounting standards that may suggest otherwise. Furthermore, it limits the number of increases to one per legislative quadrennium starting November 4, 2026, and clarifies that it does not affect any previous cost-of-living increases or bonuses granted under prior legislation. The act is set to take effect on October 1, 2026.

Statutes affected:
Introduced: 36-27-6, 36-27-7, 36-27-7, 36-27-6, 36-27-7, 36-27-7, 36-27-6, 36-27-7, 36-27-7
Enrolled: 36-27-6, 36-27-7, 36-27-7, 36-27-6, 36-27-7, 36-27-7, 36-27-6, 36-27-7, 36-27-7