The bill reinstates automatic cost-of-living adjustments (COLAs) for retirement benefits of certain members of the Police and Firemen's Retirement System (PFRS) in New Jersey. It amends Section 13 of P.L.1944, c.255 (C.43:16A-13) to enhance the board of trustees' authority to modify benefits, ensuring that such changes do not increase employer contributions and are supported by actuarial certification. The legislation outlines the governance structure of the board, which includes 12 trustees representing active policemen, firemen, retirees, and gubernatorial appointees, and emphasizes their fiduciary duty to members. The bill also establishes the responsibilities of the chief investment officer and mandates annual investment training and an ethics policy aligned with the New Jersey Conflicts of Interest Law.

A significant aspect of the bill is the implementation of automatic COLAs for eligible members who have been retired for at least ten years, with adjustments based on a capped amount for the first year and linked to the Consumer Price Index (CPI) thereafter. The adjustments will not be retroactive and will exclude certain members, such as those hired after the bill's effective date and those with less than 25 years of service. Furthermore, if the Board of Trustees fails to comply with the provisions within six months, the State Treasurer will assume responsibility for implementing the COLAs. The bill also requires the Legislature to appropriate necessary funds from the General Fund to cover the costs of these adjustments, ensuring that local employers are reimbursed, thereby prioritizing the financial security of retired first responders amidst rising inflation.

Statutes affected:
Introduced: 43:16A-13, 43:3B-2