The bill amends Section 16-16-40 of the General Laws to enhance retirement benefits for teachers in Rhode Island, particularly focusing on cost of living adjustments (COLAs). It introduces new provisions for COLAs based on retirement dates, establishing a 1.5% annual adjustment for those who retired on or before December 31, 1967, and a 3% adjustment for those who retired after January 1, 1968, starting the January following their third year of retirement. Additionally, it sets a cap on COLAs for teachers not eligible to retire by September 30, 2009, limiting adjustments to the first $35,000 of their retirement allowance, which will be indexed annually. The bill also includes a one-time benefit adjustment of 2% for retirees who retired on or before June 30, 2012, and introduces a temporary provision for benefit adjustments based on the Five-Year Average Investment Return of the retirement system.

Moreover, the bill modifies existing criteria for benefit adjustments, changing the threshold for full adjustments from a funded ratio of 80% to 75%, effective July 1, 2025. It also ensures that retired teachers covered by municipal pension plans receive the same COLA adjustments as those in the state Employees’ Retirement System. The legislation includes a one-time stipend of $500 for retirees who retired on or before July 1, 2015, payable within 60 days of enactment, with a second stipend in the following year. Overall, the bill aims to provide equitable retirement benefits while maintaining the financial health of the retirement systems, with specific insertions and deletions to current law to reflect these changes.

Statutes affected:
1000: 16-16-40, 36-10-35