The bill amends the General Laws regarding retirement benefits for teachers and state employees in Rhode Island. It introduces a one-time benefit adjustment for teachers who retired on or before June 30, 2012, providing a 2% increase on the lesser of the retirement allowance or the first $25,000 of the allowance. The bill also establishes a formula for annual benefit adjustments based on investment returns and the Consumer Price Index (CPI-U), with a cap of 3.5% and a floor of 0%, contingent on the funded ratio of the retirement system exceeding 80%. It specifies intervals for benefit adjustments and increases the indexed amount for certain retirees, with provisions for adjustments based on the Five-Year Average Investment Return of the retirement system and conditions for benefit adjustments based on the Funded Ratio of the retirement system.

Additionally, the bill includes a new provision effective July 1, 2023, offering a one-time stipend of 3% of the lesser of the retirement allowance or $30,000 to members or beneficiaries, irrespective of age or years since retirement. This stipend is not considered a cost of living adjustment and will be paid from the state's general fund, subject to appropriation by the general assembly. The bill allows for the possibility of providing these stipends in subsequent fiscal years, starting with the fiscal year beginning July 1, 2024. The new legal language inserted into the bill indicates that the stipend will be paid from the state's general fund, subject to appropriation by the general assembly, and the act will take effect upon passage.

Statutes affected:
6295: 16-16-40, 36-10-35