The bill amends various sections of the General Laws to adjust retirement benefits for teachers, state employees, and municipal employees. It provides cost of living adjustments (COLAs) for retirees based on different criteria, such as retirement date and the funded ratio of the retirement system. For teachers and state employees who retired before certain dates, the bill outlines a series of annual increases to their retirement allowances, with a new formula for calculating future benefit adjustments tied to investment returns and the Consumer Price Index for Urban Consumers (CPI-U). The bill also introduces a cap on COLAs for certain employees, limiting the adjustment to the first $35,000 of the retirement allowance, indexed annually. Additionally, the bill specifies that benefit adjustments will be suspended unless the funded ratio of the retirement system exceeds 80%, with a provision for a benefit adjustment every fifth plan year until the funded ratio exceeds this threshold. A one-time benefit adjustment of 2% is also provided for members who retired on or before June 30, 2012.

Furthermore, the bill includes a new insertion that grants a one-time allowance of $500 to eligible members of the retirement system or their beneficiaries who retired on or before July 1, 2022. This allowance is to be paid from the state's general fund, subject to appropriation by the general assembly, and is not considered a COLA under the previous provisions. The bill also amends the section pertaining to municipal employees, allowing local legislative bodies to provide automatic adjustment increases to retirement allowances. For municipal employees, the bill details a benefit adjustment formula based on investment returns with a cap and floor, and it stipulates that adjustments will be suspended unless the plan's funded ratio exceeds 80%. The bill also includes a one-time 2% benefit adjustment for certain retirees and outlines contribution requirements from employees and the city or town. The bill will take effect upon passage, with the $500 allowances payable within 60 days of enactment and again in the same month of the following year.

Statutes affected:
6006: 16-16-40, 36-10-35, 45-21-52