This bill amends Section 36-10-35 of the General Laws to provide additional benefits to retired state employees and beneficiaries. It establishes a cost of living retirement adjustment for state employees and beneficiaries who retired on or before December 31, 1967, and for those who retired on or after January 1, 1968. The adjustment will be a percentage of the original retirement allowance and will be added to the retirement allowance each year in January. The bill also includes provisions for the cost of living adjustment for state employees and beneficiaries who have completed at least ten years of contributory service on or before July 1, 2005, and for those who receive a disability retirement allowance. The adjustment will be computed and paid at a rate of three percent of the original retirement allowance, compounded annually. The bill also includes provisions for the cost of living adjustment for state employees and beneficiaries who have not completed at least ten years of contributory service on or before July 1, 2005, or were not eligible to retire as of September 30, 2009. The adjustment will be computed by multiplying the retirement allowance by three percent or the percentage of increase in the Consumer Price Index for all Urban Consumers, whichever is less. The bill also includes provisions for the cost of living adjustment for state employees not eligible to retire as of September 30, 2009, and their beneficiaries. The adjustment will only apply to the first thirty-five thousand dollars of retirement allowance, indexed annually, and will commence on the third anniversary of retirement or when the retiree reaches age sixty-five, whichever is later. The thirty-five thousand dollar limit will increase annually by the percentage increase in the Consumer Price Index for all Urban Consumers or three percent, whichever is less. The bill also includes provisions for the cost of living adjustment for legislators and their beneficiaries who are receiving a retirement allowance for three or more years. The adjustment will be equal to three percent of the original retirement allowance and will be increased by an additional three percent each year in January, compounded annually, for the lifetime of the legislator or beneficiary. The bill also includes provisions for the annual benefit adjustment for all present and former employees, active and retired members, and beneficiaries receiving any retirement, disability, or death allowance or benefit. The adjustment will be determined based on the Five-Year Average Investment Return of the retirement system and will be equal to the percentage determined by subtracting five and a half percent from the investment return. This adjustment will be effective for the period July 1, 2012, through June 30, 2015.
This bill would provide a three percent annual benefit adjustment (COLA) to all members of the state pension system, to be applied to the first thirty thousand dollars of their retirement allowance, starting on July 1, 2023. However, this adjustment would only be granted if the prior year's investment yield is eight percent or more. This provision would remain in effect until the pension system's funding ratio reaches eighty percent. The bill would take effect immediately upon passage.
Statutes affected: 5523: 36-10-35