The bill amends the Teachers’ Retirement system laws to extend benefits to spouses, former spouses, and domestic partners of deceased members, who are eligible for benefits at age 60 if they were living with or supported by the member at the time of death. Remarriage or a new domestic partnership disqualifies individuals from receiving benefits. The bill updates minimum monthly benefit amounts based on the deceased member's highest annual salary. It also includes cost-of-living retirement adjustments for retired teachers, with a 1.5% increase per year of the original retirement allowance, and additional adjustments based on the Consumer Price Index for all Urban Consumers (CPI-U) or 3%, whichever is less. The adjustments are compounded annually and have specific provisions for those who retired after January 1, 1968, and those with at least ten years of contributory service before July 1, 2005, or eligible to retire as of September 30, 2009. The bill also outlines a formula for annual benefit adjustments from July 1, 2012, to June 30, 2015, based on the Five-Year Average Investment Return, with a cap of 4% and a floor of 0%, and stipulates that adjustments will be suspended unless the Funded Ratio exceeds 80%.

Effective January 1, 2024, the bill provides a one-time benefit adjustment of 2% for teachers who retired on or before June 30, 2012, and from January 1, 2016, annual benefit adjustments will be based on a new formula involving the Five-Year Average Investment Return and the CPI-U, with a combined cap of 3.5% and a floor of 0%. The adjustment applies to the lesser of the retirement allowance or the first $25,855, indexed annually. If the Funded Ratio is below 80%, the adjustment is reduced to 25% of the calculated amount. The bill includes an insertion for an additional one-time 2% benefit adjustment for the plan year 2025 and increases the dollar amount for benefit adjustments to $31,026 when the Funded Ratio exceeds 80%. Retired teachers or their beneficiaries as of July 1, 2015, will receive a one-time stipend of $500 within 60 days following the enactment and a second stipend of $500 in the same month of the following year. The bill also amends Section 36-10-35 of the General Laws to be effective January 1, 2024, and includes changes to the Rhode Island personal income tax code, such as the treatment of PPP loan forgiveness and modifications for inflation and specific income for taxpayers.

Statutes affected:
7993: 36-10-35, 44-30-12, 45-21-52