The bill amends the General Laws regarding retirement benefits for teachers and state employees in Rhode Island. It introduces a new cost of living retirement adjustment, with a 1.5% per year increase for those who retired before December 31, 1967, and a 3% increase for those who retired on or after January 1, 1968, with specific conditions for compounding and indexing based on the Consumer Price Index for all Urban Consumers (CPI-U) and the Five-Year Average Investment Return. The bill also specifies that the sections 45-13-7 to 45-13-10 do not apply to this section and that subsection (f) is effective from July 1, 2012, through June 30, 2015. Additionally, a new subsection (h) effective July 1, 2023, provides for a one-time stipend of 3% of the lesser of the member's retirement allowance or $30,000 to members or beneficiaries who retired on or before June 30, 2012, payable from the state's general fund subject to appropriation by the general assembly.

The bill further amends Section 36-10-35 to provide similar cost of living adjustments for retired state employees, with a 1.5% increase for those who retired before December 31, 1967, and a 3% increase for those who retired on or after January 1, 1968. It also introduces a cap on the cost of living adjustment for state employees not eligible to retire by September 30, 2009, limiting it to the first $35,000 of the retirement allowance, indexed annually. Legislators and their beneficiaries are also included, with a 3% compounded annual adjustment after three years of receiving a retirement allowance. A one-time benefit adjustment of 2% is also proposed for members who retired on or before June 30, 2012. The bill includes insertions that specify the effective date of these provisions as July 1, 2023, and conditions for the stipend payment, with the act taking effect upon passage.

Statutes affected:
5316: 16-16-40, 36-10-35