SECTION 1. Sections 16-16-26 and 16-16-40 of the General Laws in Chapter 16-16 entitled "Teachers’ Retirement [See Title 16 Chapter 97 — The Rhode Island Board of Education Act]" are hereby amended to read as follows:
16-16-26. Spouse’s, former spouse divorced, or domestic partner’s benefits.
(a) Spouse’s, former spouse divorced, and domestic partner’s benefits are payable following the decease of a member as provided in §§ 16-16-25 — 16-16-38.
(b) The spouse, former spouse divorced, or domestic partner shall be entitled to benefits upon attaining the age of sixty (60) years.
(c) The spouse, former spouse divorced, or domestic partner was living with the deceased member at the time of the member’s death. A spouse, former spouse divorced, or domestic partner is deemed to have been living with the deceased member if they were both members of the same household on the date of the deceased member’s death, or the spouse, former spouse divorced, or domestic partner was receiving contributions from the deceased member toward support on that date, or the deceased member had been ordered by a court to contribute to the spouse’s, former spouse divorced, or domestic partner’s support.
(d) Remarriage of the spouse, former spouse divorced, or domestic partner or establishment of a domestic partnership shall render the person ineligible to receive current or future benefits under this section.
(e) The spouse or domestic partner of a member, as defined in this section, shall be entitled to monthly benefits payable in accordance with the following table:
Spouse's or Domestic
Highest Annual Partner's Monthly
Salary Minimum Benefit
$17,000 or less $825 $1,025
$17,001 to $25,000 $963 $1,200
$25,001 to $33,000 $1,100 $1,375
$33,001 to $40,000 $1,238 $1,550
$40,001 and over $1,375 $1,725
(f) The former spouse divorced shall be entitled to monthly benefits, payable in accordance with the table provided in subsection (e) of this section, only if there are no dependent children, parents, or other spouse or domestic partner entitled to benefits.
(g) A yearly adjustment of the base benefit, and a yearly cost-of-living adjustment for spouse’s, former spouse divorced, or domestic partner’s benefits shall be based on the annual social security adjustment.
16-16-40. Additional benefits payable to retired teachers.
(a) All teachers and all beneficiaries of teachers receiving any service retirement or ordinary or accidental disability retirement allowance pursuant to the provisions of this chapter and chapter 17 of this title, on or before December 31, 1967, shall receive a cost of living retirement adjustment equal to one and one-half percent (1.5%) per year of the original retirement allowance, not compounded, for each year the retirement allowance has been in effect. For purposes of computation credit shall be given for a full calendar year regardless of the effective date of the retirement allowance. This cost of living retirement adjustment shall be added to the amount of the service retirement allowance as of January 1, 1970, and payment shall begin as of July 1, 1970. An additional cost of living retirement adjustment shall be added to the original retirement allowance equal to three percent (3%) of the original retirement allowance on the first day of January, 1971, and each year thereafter through December 31, 1980.
(b) All teachers and beneficiaries of teachers receiving any service retirement or ordinary disability retirement allowance pursuant to the provisions of this title who retired on or after January 1, 1968, shall, on the first day of January, next following the third (3rd) year on retirement, receive a cost of living adjustment, in addition to their retirement allowance, an amount equal to three percent (3%) of the original retirement allowance. In each succeeding year thereafter, on the first day of January, the retirement allowance shall be increased an additional three percent (3%) of the original retirement allowance, not compounded, to be continued through December 31, 1980. LC003371 - Page 2 of 25
(c)(1) Beginning on January 1, 1981, for all teachers and beneficiaries of teachers receiving any service retirement and all teachers and all beneficiaries of teachers who have completed at least ten (10) years of contributory service on or before July 1, 2005, pursuant to the provisions of this chapter, and for all teachers and beneficiaries of teachers who receive a disability retirement allowance pursuant to §§ 16-16-14 — 16-16-17, the cost of living adjustment shall be computed and paid at the rate of three percent (3%) of the original retirement allowance or the retirement allowance as computed in accordance with § 16-16-40.1, compounded annually from the year for which the cost of living adjustment was determined to be payable by the retirement board pursuant to the provisions of subsection (a) or (b) of this section. Such cost of living adjustments are available to teachers who retire before October 1, 2009, or are eligible to retire as of September 30, 2009.
(2) The provisions of this subsection shall be deemed to apply prospectively only and no retroactive payment shall be made.
(3) The retirement allowance of all teachers and all beneficiaries of teachers who have not completed at least ten (10) years of contributory service on or before July 1, 2005, or were not eligible to retire as of September 30, 2009, shall, on the month following the third anniversary date of the retirement, and on the month following the anniversary date of each succeeding year be adjusted and computed by multiplying the retirement allowance by three percent (3%) or the percentage of increase in the Consumer Price Index for All Urban Consumers (CPI-U) as published by the United States Department of Labor Statistics, determined as of September 30 of the prior calendar year, whichever is less; the cost of living adjustment shall be compounded annually from the year for which the cost of living adjustment was determined payable by the retirement board; provided, that no adjustment shall cause any retirement allowance to be decreased from the retirement allowance provided immediately before such adjustment.
(d) For teachers not eligible to retire in accordance with this chapter as of September 30, 2009, and not eligible upon passage of this article, and for their beneficiaries, the cost of living adjustment described in subsection (c)(3) of this section shall only apply to the first thirty-five thousand dollars ($35,000) of retirement allowance, indexed annually, and shall commence upon the third (3rd) anniversary of the date of retirement or when the retiree reaches age sixty-five (65), whichever is later. The thirty-five thousand dollar ($35,000) limit shall increase annually by the percentage increase in the Consumer Price Index for All Urban Consumers (CPI-U) as published by the United States Department of Labor Statistics determined as of September 30 of the prior calendar year or three percent (3%), whichever is less. The first thirty-five thousand dollars ($35,000), as indexed, of retirement allowance shall be multiplied by the percentage of increase in the Consumer Price Index for All Urban Consumers (CPI-U) as published by the United States LC003371 - Page 3 of 25 Department of Labor Statistics determined as of September 30 of the prior calendar year or three percent (3%), whichever is less, on the month following the anniversary date of each succeeding year. For teachers eligible to retire as of September 30, 2009, or eligible upon passage of this article, and for their beneficiaries, the provisions of this subsection (d) shall not apply.
(e) The provisions of §§ 45-13-7 — 45-13-10 shall not apply to this section.
(f) This subsection (f) shall be effective for the period July 1, 2012, through June 30, 2015.
(1) Notwithstanding the prior paragraphs of this section, and subject to subsection (f)(2) below, for all present and former teachers, active and retired teachers, and beneficiaries receiving any retirement, disability or death allowance or benefit of any kind, the annual benefit adjustment provided in any calendar year under this section shall be equal to (A) multiplied by (B) where (A) is equal to the percentage determined by subtracting five and one-half percent (5.5%) (the “subtrahend”) from the Five-Year Average Investment Return of the retirement system determined as of the last day of the plan year preceding the calendar year in which the adjustment is granted, said percentage not to exceed four percent (4%) and not to be less than zero percent (0%), and (B) is equal to the lesser of the teacher’s retirement allowance or the first twenty-five thousand dollars ($25,000) of retirement allowance, such twenty-five thousand dollars ($25,000) amount to be indexed annually in the same percentage as determined under (f)(1)(A) above. The “Five-Year Average Investment Return” shall mean the average of the investment returns of the most recent five (5) plan years as determined by the retirement board. Subject to subsection (f)(2) below, the benefit adjustment provided by this subsection (f)(1) shall commence upon the third (3rd) anniversary of the date of retirement or the date on which the retiree reaches their Social Security retirement age, whichever is later. In the event the retirement board adjusts the actuarially assumed rate of return for the system, either upward or downward, the subtrahend shall be adjusted either upward or downward in the same amount.
(2) Except as provided in subsection (f)(3), the benefit adjustments under this section for any plan year shall be suspended in their entirety unless the funded ratio of the employees’ retirement system of Rhode Island, the judicial retirement benefits trust, and the state police retirement benefits trust, calculated by the system’s actuary on an aggregate basis, exceeds eighty percent (80%) in which event the benefit adjustment will be reinstated for all teachers for such plan year.
In determining whether a funding level under this subsection (f)(2) has been achieved, the actuary shall calculate the funding percentage after taking into account the reinstatement of any current or future benefit adjustment provided under this section.
(3) Notwithstanding subsection (f)(2), in each fifth plan year commencing after June 30, LC003371 - Page 4 of 25 2012, commencing with the plan year ending June 30, 2017, and subsequently at intervals of five plan years, a benefit adjustment shall be calculated and made in accordance with subsection (f)(1) above until the funded ratio of the employees’ retirement system of Rhode Island, the judicial retirement benefits trust, and the state police retirement benefits trust, calculated by the system’s actuary on an aggregate basis, exceeds eighty percent (80%).
(4) Notwithstanding any other provisions of this chapter, the provisions of this subsection (f) shall become effective July 1, 2012, and shall apply to any benefit adjustments not granted on or prior to June 30, 2012.
(g) This subsection (g) shall become effective July 1, 2015.
(1)(A) As soon as administratively reasonable following the enactment into law of this subsection (g)(1)(A), a one-time benefit adjustment shall be provided to teachers and/or beneficiaries of teachers who retired on or before June 30, 2012, in the amount of two percent (2%) of the lesser of either the teacher’s retirement allowance or the first twenty-five thousand dollars ($25,000) of the teacher’s retirement allowance. This one-time benefit adjustment shall be provided without regard to the retiree’s age or number of years since retirement.
(B) Notwithstanding the prior subsections of this section, for all present and former teachers, active and retired teachers, and beneficiaries receiving any retirement, disability, or death allowance or benefit of any kind, the annual benefit adjustment provided in any calendar year under this section for adjustments on and after January 1, 2016, and subject to subsection (g)(2) below, shall be equal to (I) multiplied by (II):
(I) shall equal the sum of fifty percent (50%) of (i) plus fifty percent (50%) of (ii) where:
(i) is equal to the percentage determined by subtracting five and one-half percent (5.5%) (the “subtrahend”) from the five-year average investment return of the retirement system determined as of the last day of the plan year preceding the calendar year in which the adjustment is granted, said percentage not to exceed four percent (4%) and not to be less than zero percent (0%). The “five-year average investment return” shall mean the average of the investment returns of the most recent five (5) plan years as determined by the retirement board. In the event the retirement board adjusts the actuarially assumed rate of return for the system, either upward or downward, the subtrahend shall be adjusted either upward or downward in the same amount.
(ii) is equal to the lesser of three percent (3%) or the percentage increase in the Consumer Price Index for All Urban Consumers (CPI-U) as published by the U.S. Department of Labor Statistics determined as of September 30 of the prior calendar year.
In no event shall the sum of (i) plus (ii) exceed three and one-half percent (3.5%) or be less than (0%) percent. LC003371 - Page 5 of 25
(II) is equal to the lesser of either the teacher’s retirement allowance or the first twenty- five thousand eight hundred and fifty-five dollars ($25,855) of retirement allowance, such amount to be indexed annually in the same percentage as determined under subsection (g)(1)(B)(I) above.
The benefit adjustments provided by this subsection (g)(1)(B) shall be provided to all retirees entitled to receive a benefit adjustment as of June 30, 2012, under the law then in effect, and for all other retirees the benefit adjustments shall commence upon the third anniversary of the date of retirement or the date on which the retiree reaches his or her Social Security retirement age, whichever is later.
(2) Except for teachers and/or beneficiaries of teachers who retired on or before June 30, 2012, the benefit adjustments under subsection (g)(1)(B) for any plan year shall be reduced to twenty-five percent (25%) of the benefit adjustment unless the funded ratio of the employees’ retirement system of Rhode Island, the judicial retirement benefits trust, and the state police retirement benefits trust, calculated by the system’s actuary on an aggregate basis, exceeds eighty percent (80%) in which event the benefit adjustment will be reinstated for all teachers for such plan year. Effective July 1, 2024, the funded ratio of the employees’ retirement system of Rhode Island, the judicial retirement benefits trust, and the state police retirement benefits trust, calculated by the system’s actuary on an aggregate basis, of exceeding eighty percent (80%) for the benefit adjustment to be reinstated for all teachers for such plan year shall be replaced with seventy-five percent (75%). For plan year 2026, eligible retirees who retired after July 1, 2012, shall receive a one-time full COLA of two and eighty-nine one hundredths percent (2.89%).
In determining whether a funding level under this subsection (g)(2) has been achieved, the actuary shall calculate the funding percentage after taking into account the reinstatement of any current or future benefit adjustment provided under this section.
(3) Effective for teachers and/or beneficiaries of teachers who retired after June 30, 2012, or on or before June 30, 2015, the dollar amount in subsection (g)(1)(B)(II) of twenty-five thousand eight hundred and fifty-five dollars ($25,855) shall be replaced with thirty-one thousand and twenty-six dollars ($31,026) until the funded ratio of the employees’ retirement system of Rhode Island, the judicial retirement benefits trust, and the state police retirement benefits trust, calculated by the system’s actuary on an aggregate basis, exceeds eighty percent (80%). Effective July 1, 2024, the funded ratio of the employees’ retirement system of Rhode Island, the judicial retirement benefits trust, and the state police retirement benefits trust, calculated by the system’s actuary on an aggregate basis, of exceeding eighty percent (80%) shall be replaced with seventy-five percent (75%).
(4) Effective for teachers and/or beneficiaries of teachers who have retired on or before LC003371 - Page 6 of 25 July 1, 2015, a one-time stipend of five hundred dollars ($500) shall be payable within sixty (60) days following the enactment of the legislation implementing this provision, and a second one-time stipend of five hundred dollars ($500) in the same month of the following year. These stipends shall be payable to all retired teachers or beneficiaries receiving a benefit as of the applicable payment date and shall not be considered cost of living adjustments under the prior provisions of this section.

SECTION 2. Section 36-10-35 of the General Laws in Chapter 36-10 entitled "Retirement System — Contributions and Benefits" is hereby amended to read as follows:
36-10-35. Additional benefits payable to retired employees.
(a) All state employees and all beneficiaries of state employees receiving any service retirement or ordinary or accidental disability retirement allowance pursuant to the provisions of this title on or before December 31, 1967, shall receive a cost of living retirement adjustment equal to one and one-half percent (1.5%) per year of the original retirement allowance, not compounded, for each calendar year the retirement allowance has been in effect. For the purposes of computation, credit shall be given for a full calendar year regardless of the effective date of the retirement allowance. This cost of living adjustment shall be added to the amount of the retirement allowance as of January 1, 1968, and an additional one and one-half percent (1.5%) shall be added to the original retirement allowance in each succeeding year during the month of January, and provided further, that this additional cost of living increase shall be three percent (3%) for the year beginning January 1, 1971, and each year thereafter, through December 31, 1980. Notwithstanding any of the above provisions, no employee receiving any service retirement allowance pursuant to the provisions of this title on or before December 31, 1967, or the employee’s beneficiary, shall receive any additional benefit hereunder in an amount less than two hundred dollars ($200) per year over the service retirement allowance where the employee retired prior to January 1, 1958.
(b) All state employees and all beneficiaries of state employees retired on or after January 1, 1968, who are receiving any service retirement or ordinary or accidental disability retirement allowance pursuant to the provisions of this title shall, on the first day of January next following the third anniversary date of the retirement, receive a cost of living retirement adjustment, in addition to their retirement allowance, in an amount equal to three percent (3%) of the original retirement allowance. In each succeeding year thereafter through December 31, 1980, during the month of January, the retirement allowance shall be increased an additional three percent (3%) of the original retirement allowance, not compounded, to be continued during the lifetime of the employee or beneficiary. For the purposes of computation, credit shall be given for a full calendar year regardless of the effective date of the service retirement allowance. LC003371 - Page 7 of 25
(c)(1) Beginning on January 1, 1981, for all state employees and beneficiaries of the state employees receiving any service retirement and all state employees, and all beneficiaries of state employees, who have completed at least ten (10) years of contributory service on or before July 1, 2005, pursuant to the provisions of this chapter, and for all state employees, and all beneficiaries of state employees who receive a disability retirement allowance pursuant to §§ 36-10-12 — 36- 10-15, the cost of living adjustment shall be computed and paid at the rate of three percent (3%) of the original retirement allowance or the retirement allowance as computed in accordance with § 36-10-35.1, compounded annually from the year for which the cost of living adjustment was determined to be payable by the retirement board pursuant to the provisions of subsection (a) or (b) of this section. Such cost of living adjustments are available to members who retire before October 1, 2009, or are eligible to retire as of September 30, 2009.
(2) The provisions of this subsection shall be deemed to apply prospectively only and no retroactive payment shall be made.
(3) The retirement allowance of all state employees and all beneficiaries of state employees who have not completed at least ten (10) years of contributory service on or before July 1, 2005, or were not eligible to retire as of September 30, 2009, shall, on the month following the third anniversary date of retirement, and on the month following the anniversary date of each succeeding year be adjusted and computed by multiplying the retirement allowance by three percent (3%) or the percentage of increase in the Consumer Price Index for All Urban Consumers (CPI-U) as published by the United States Department of Labor Statistics determined as of September 30 of the prior calendar year, whichever is less; the cost of living adjustment shall be compounded annually from the year for which the cost of living adjustment was determined payable by the retirement board; provided, that no adjustment shall cause any retirement allowance to be decreased from the retirement allowance provided immediately before such adjustment.
(d) For state employees not eligible to retire in accordance with this chapter as of September 30, 2009, and not eligible upon passage of this article, and for their beneficiaries, the cost of living adjustment described in subsection (c)(3) of this section shall only apply to the first thirty-five thousand dollars ($35,000) of retirement allowance, indexed annually, and shall commence upon the third (3rd) anniversary of the date of retirement or when the retiree reaches age sixty-five (65), whichever is later. The thirty-five thousand dollar ($35,000) limit shall increase annually by the percentage increase in the Consumer Price Index for All Urban Consumers (CPI- U) as published by the United States Department of Labor Statistics determined as of September 30 of the prior calendar year or three percent (3%), whichever is less. The first thirty-five thousand dollars ($35,000) of retirement allowance, as indexed, shall be multiplied by the percentage of LC003371 - Page 8 of 25 increase in the Consumer Price Index for All Urban Consumers (CPI-U) as published by the United States Department of Labor Statistics determined as of September 30 of the prior calendar year or three percent (3%), whichever is less, on the month following the anniversary date of each succeeding year. For state employees eligible to retire as of September 30, 2009, or eligible upon passage of this article, and for their beneficiaries, the provisions of this subsection (d) shall not apply.
(e) All legislators and all beneficiaries of legislators who are receiving a retirement allowance pursuant to the provisions of § 36-10-9.1 for a period of three (3) or more years, shall, commencing January 1, 1982, receive a cost of living retirement adjustment, in addition to a retirement allowance, in an amount equal to three percent (3%) of the original retirement allowance. In each succeeding year thereafter during the month of January, the retirement allowance shall be increased an additional three percent (3%) of the original retirement allowance, compounded annually, to be continued during the lifetime of the legislator or beneficiary. For the purposes of computation, credit shall be given for a full calendar year regardless of the effective date of the service retirement allowance.
(f) The provisions of §§ 45-13-7 — 45-13-10 shall not apply to this section.
(g) This subsection (g) shall be effective for the period July 1, 2012, through June 30, 2015.
(1) Notwithstanding the prior paragraphs of this section, and subject to subsection (g)(2) below, for all present and former employees, active and retired members, and beneficiaries receiving any retirement, disability or death allowance or benefit of any kind, the annual benefit adjustment provided in any calendar year under this section shall be equal to (A) multiplied by (B) where (A) is equal to the percentage determined by subtracting five and one-half percent (5.5%) (the “subtrahend”) from the Five-Year Average Investment Return of the retirement system determined as of the last day of the plan year preceding the calendar year in which the adjustment is granted, said percentage not to exceed four percent (4%) and not to be less than zero percent (0%), and (B) is equal to the lesser of the member’s retirement allowance or the first twenty-five thousand dollars ($25,000) of retirement allowance, such twenty-five thousand dollars ($25,000) amount to be indexed annually in the same percentage as determined under (g)(1)(A) above. The “Five-Year Average Investment Return” shall mean the average of the investment returns of the most recent five (5) plan years as determined by the retirement board. Subject to subsection (g)(2) below, the benefit adjustment provided by this subsection (g)(1) shall commence upon the third (3rd) anniversary of the date of retirement or the date on which the retiree reaches their Social Security retirement age, whichever is later. In the event the retirement board adjusts the actuarially assumed rate of return for the system, either upward or downward, the subtrahend shall be adjusted LC003371 - Page 9 of 25 either upward or downward in the same amount.
(2) Except as provided in subsection (g)(3), the benefit adjustments under this section for any plan year shall be suspended in their entirety unless the funded ratio of the employees’ retirement system of Rhode Island, the judicial retirement benefits trust, and the state police retirement benefits trust, calculated by the system’s actuary on an aggregate basis, exceeds eighty percent (80%) in which event the benefit adjustment will be reinstated for all members for such plan year.
In determining whether a funding level under this subsection (g)(2) has been achieved, the actuary shall calculate the funding percentage after taking into account the reinstatement of any current or future benefit adjustment provided under this section.
(3) Notwithstanding subsection (g)(2), in each fifth plan year commencing after June 30, 2012, commencing with the plan year ending June 30, 2017, and subsequently at intervals of five plan years, a benefit adjustment shall be calculated and made in accordance with subsection (g)(1) above until the funded ratio of the employees’ retirement system of Rhode Island, the judicial retirement benefits trust, and the state police retirement benefits trust, calculated by the system’s actuary on an aggregate basis, exceeds eighty percent (80%).
(4) Notwithstanding any other provision of this chapter, the provisions of this subsection (g) shall become effective July 1, 2012, and shall apply to any benefit adjustment not granted on or prior to June 30, 2012.
(h) This subsection (h) shall become effective July 1, 2015.
(1)(A) As soon as administratively reasonable following the enactment into law of this subsection (h)(1)(A), a one-time benefit adjustment shall be provided to members and/or beneficiaries of members who retired on or before June 30, 2012, in the amount of two percent (2%) of the lesser of either the member’s retirement allowance or the first twenty-five thousand dollars ($25,000) of the member’s retirement allowance. This one-time benefit adjustment shall be provided without regard to the retiree’s age or number of years since retirement.
(B) Notwithstanding the prior subsections of this section, for all present and former employees, active and retired members, and beneficiaries receiving any retirement, disability or death allowance or benefit of any kind, the annual benefit adjustment provided in any calendar year under this section for adjustments on and after January 1, 2016, and subject to subsection (h)(2) below, shall be equal to (I) multiplied by (II):
(I) shall equal the sum of fifty percent (50%) of (i) plus fifty percent (50%) of (ii) where:
(i) is equal to the percentage determined by subtracting five and one-half percent (5.5%) (the “subtrahend”) from the five-year average investment return of the retirement system LC003371 - Page 10 of 25 determined as of the last day of the plan year preceding the calendar year in which the adjustment is granted, said percentage not to exceed four percent (4%) and not to be less than zero percent (0%). The “five-year average investment return” shall mean the average of the investment returns of the most recent five (5) plan years as determined by the retirement board. In the event the retirement board adjusts the actuarially assumed rate of return for the system, either upward or downward, the subtrahend shall be adjusted either upward or downward in the same amount.
(ii) is equal to the lesser of three percent (3%) or the percentage increase in the Consumer Price Index for All Urban Consumers (CPI-U) as published by the U.S. Department of Labor Statistics determined as of September 30 of the prior calendar year. In no event shall the sum of (i) plus (ii) exceed three and one-half percent (3.5%) or be less than zero percent (0%).
(II) is equal to the lesser of either the member’s retirement allowance or the first twenty- five thousand eight hundred and fifty-five dollars ($25,855) of retirement allowance, such amount to be indexed annually in the same percentage as determined under subsection (h)(1)(B)(I) above.
The benefit adjustments provided by this subsection (h)(1)(B) shall be provided to all retirees entitled to receive a benefit adjustment as of June 30, 2012, under the law then in effect, and for all other retirees the benefit adjustments shall commence upon the third anniversary of the date of retirement or the date on which the retiree reaches their Social Security retirement age, whichever is later.
(2) Except for members and/or beneficiaries of members who retired on or before June 30, 2012, the benefit adjustments under subsection (h)(1)(B) for any plan year shall be reduced to twenty-five percent (25%) of the benefit adjustment unless the funded ratio of the employees’ retirement system of Rhode Island, the judicial retirement benefits trust, and the state police retirement benefits trust, calculated by the system’s actuary on an aggregate basis, exceeds eighty percent (80%) in which event the benefit adjustment will be reinstated for all members for such plan year. Effective July 1, 2024, the funded ratio of the employees’ retirement system of Rhode Island, the judicial retirement benefits trust, and the state police retirement benefits trust, calculated by the system’s actuary on an aggregate basis, of exceeding eighty percent (80%) for the benefit adjustment to be reinstated for all members for such plan year shall be replaced with seventy-five percent (75%). For plan year 2026, eligible retirees who retired after July 1, 2012, shall receive a one-time full COLA of two and eighty-nine one hundredths percent (2.89%).
In determining whether a funding level under this subsection (h)(2) has been achieved, the actuary shall calculate the funding percentage after taking into account the reinstatement of any current or future benefit adjustment provided under this section.
(3) Effective for members and/or beneficiaries of members who retired after June 30, 2012, LC003371 - Page 11 of 25 or on or before June 30, 2015, the dollar amount in subsection (h)(1)(B)(II) of twenty-five thousand eight hundred and fifty-five dollars ($25,855) shall be replaced with thirty-one thousand and twenty-six dollars ($31,026) until the funded ratio of the employees’ retirement system of Rhode Island, the judicial retirement benefits trust, and the state police retirement benefits trust, calculated by the system’s actuary on an aggregate basis, exceeds eighty percent (80%). Effective July 1, 2024, the funded ratio of the employees’ retirement system of Rhode Island, the judicial retirement benefits trust, and the state police retirement benefits trust, calculated by the system’s actuary on an aggregate basis, of exceeding eighty percent (80%) shall be replaced with seventy-five percent (75%).
(i) Effective for members and/or beneficiaries of members who have retired on or before July 1, 2015, a one-time stipend of five hundred dollars ($500) shall be payable within sixty (60) days following the enactment of the legislation implementing this provision, and a second one-time stipend of five hundred dollars ($500) in the same month of the following year. These stipends shall be payable to all retired members or beneficiaries receiving a benefit as of the applicable payment date and shall not be considered cost of living adjustments under the prior provisions of this section.

SECTION 3. Section 44-30-12 of the General Laws in Chapter 44-30 entitled "Personal Income Tax" is hereby amended to read as follows:
44-30-12. Rhode Island income of a resident individual.
(a) General. The Rhode Island income of a resident individual means the individual’s adjusted gross income for federal income tax purposes, with the modifications specified in this section.
(b) Modifications increasing federal adjusted gross income. There shall be added to federal adjusted gross income:
(1) Interest income on obligations of any state, or its political subdivisions, other than Rhode Island or its political subdivisions;
(2) Interest or dividend income on obligations or securities of any authority, commission, or instrumentality of the United States, but not of Rhode Island or its political subdivisions, to the extent exempted by the laws of the United States from federal income tax but not from state income taxes;
(3) The modification described in § 44-30-25(g);
(4)(i) The amount defined below of a nonqualified withdrawal made from an account in the tuition savings program pursuant to § 16-57-6.1. For purposes of this section, a nonqualified withdrawal is: LC003371 - Page 12 of 25
(A) A transfer or rollover to a qualified tuition program under Section 529 of the Internal Revenue Code, 26 U.S.C. § 529, other than to the tuition savings program referred to in § 16-57- 6.1; and
(B) A withdrawal or distribution that is:
(I) Not applied on a timely basis to pay “qualified higher education expenses” as defined in § 16-57-3(12) of the beneficiary of the account from which the withdrawal is made;
(II) Not made for a reason referred to in § 16-57-6.1(e); or
(III) Not made in other circumstances for which an exclusion from tax made applicable by Section 529 of the Internal Revenue Code, 26 U.S.C. § 529, pertains if the transfer, rollover, withdrawal, or distribution is made within two (2) taxable years following the taxable year for which a contributions modification pursuant to subsection (c)(4) of this section is taken based on contributions to any tuition savings program account by the person who is the participant of the account at the time of the contribution, whether or not the person is the participant of the account at the time of the transfer, rollover, withdrawal, or distribution;
(ii) In the event of a nonqualified withdrawal under subsection (b)(4)(i)(A) or (b)(4)(i)(B) of this section, there shall be added to the federal adjusted gross income of that person for the taxable year of the withdrawal an amount equal to the lesser of:
(A) The amount equal to the nonqualified withdrawal reduced by the sum of any administrative fee or penalty imposed under the tuition savings program in connection with the nonqualified withdrawal plus the earnings portion thereof, if any, includible in computing the person’s federal adjusted gross income for the taxable year; and
(B) The amount of the person’s contribution modification pursuant to subsection (c)(4) of this section for the person’s taxable year of the withdrawal and the two (2) prior taxable years less the amount of any nonqualified withdrawal for the two (2) prior taxable years included in computing the person’s Rhode Island income by application of this subsection for those years. Any amount added to federal adjusted gross income pursuant to this subdivision shall constitute Rhode Island income for residents, nonresidents, and part-year residents;
(5) The modification described in § 44-30-25.1(d)(3)(i);
(6) The amount equal to any unemployment compensation received but not included in federal adjusted gross income;
(7) The amount equal to the deduction allowed for sales tax paid for a purchase of a qualified motor vehicle as defined by the Internal Revenue Code § 164(a)(6);
(8) For any taxable year beginning on or after January 1, 2020, the amount of any Paycheck Protection Program loan forgiven for federal income tax purposes as authorized by the Coronavirus LC003371 - Page 13 of 25 Aid, Relief, and Economic Security Act and/or the Consolidated Appropriations Act, 2021 and/or any other subsequent federal stimulus relief packages enacted by law, to the extent that the amount of the loan forgiven exceeds $250,000, including an individual’s distributive share of the amount of a pass-through entity’s loan forgiveness in excess of $250,000; and
(9) For the taxable year beginning on or before January 1, 2025, the amount of any income, deduction or allowance that would be subject to federal income tax but for the Congressional enactment of the One Big Beautiful Bill Act or any other similar Congressional enactment. The enactment of the One Big Beautiful Bill Act or any other similar Congressional enactment and any Internal Revenue Service changes to forms, regulations, and/or processing which go into effect during the current tax year or within six (6) months of the beginning of the next tax year shall be deemed grounds for the promulgation of emergency rules and regulations under § 42-35-2.10 to effectuate the purpose of preserving the Rhode Island tax base under Rhode Island law with respect to the One Big Beautiful Bill Act or any other similar Congressional enactment.
(c) Modifications reducing federal adjusted gross income. There shall be subtracted from federal adjusted gross income:
(1) Any interest income on obligations of the United States and its possessions to the extent includible in gross income for federal income tax purposes, and any interest or dividend income on obligations, or securities of any authority, commission, or instrumentality of the United States to the extent includible in gross income for federal income tax purposes but exempt from state income taxes under the laws of the United States; provided, that the amount to be subtracted shall in any case be reduced by any interest on indebtedness incurred or continued to purchase or carry obligations or securities the income of which is exempt from Rhode Island personal income tax, to the extent the interest has been deducted in determining federal adjusted gross income or taxable income;
(2) A modification described in § 44-30-25(f) or § 44-30-1.1(c)(1);
(3) The amount of any withdrawal or distribution from the “tuition savings program” referred to in § 16-57-6.1 that is included in federal adjusted gross income, other than a withdrawal or distribution or portion of a withdrawal or distribution that is a nonqualified withdrawal;
(4) Contributions made to an account under the tuition savings program, including the “contributions carryover” pursuant to subsection (c)(4)(iv) of this section, if any, subject to the following limitations, restrictions, and qualifications:
(i) The aggregate subtraction pursuant to this subdivision for any taxable year of the taxpayer shall not exceed five hundred dollars ($500) or one thousand dollars ($1,000) if a joint return; LC003371 - Page 14 of 25
(ii) The following shall not be considered contributions:
(A) Contributions made by any person to an account who is not a participant of the account at the time the contribution is made;
(B) Transfers or rollovers to an account from any other tuition savings program account or from any other “qualified tuition program” under section 529 of the Internal Revenue Code, 26 U.S.C. § 529; or
(C) A change of the beneficiary of the account;
(iii) The subtraction pursuant to this subdivision shall not reduce the taxpayer’s federal adjusted gross income to less than zero (0);
(iv) The contributions carryover to a taxable year for purpose of this subdivision is the excess, if any, of the total amount of contributions actually made by the taxpayer to the tuition savings program for all preceding taxable years for which this subsection is effective over the sum of:
(A) The total of the subtractions under this subdivision allowable to the taxpayer for all such preceding taxable years; and
(B) That part of any remaining contribution carryover at the end of the taxable year which exceeds the amount of any nonqualified withdrawals during the year and the prior two (2) taxable years not included in the addition provided for in this subdivision for those years. Any such part shall be disregarded in computing the contributions carryover for any subsequent taxable year;
(v) For any taxable year for which a contributions carryover is applicable, the taxpayer shall include a computation of the carryover with the taxpayer’s Rhode Island personal income tax return for that year, and if for any taxable year on which the carryover is based the taxpayer filed a joint Rhode Island personal income tax return but filed a return on a basis other than jointly for a subsequent taxable year, the computation shall reflect how the carryover is being allocated between the prior joint filers;
(5) The modification described in § 44-30-25.1(d)(1);
(6) Amounts deemed taxable income to the taxpayer due to payment or provision of insurance benefits to a dependent, including a domestic partner pursuant to chapter 12 of title 36 or other coverage plan;
(7) Modification for organ transplantation.
(i) An individual may subtract up to ten thousand dollars ($10,000) from federal adjusted gross income if the individual, while living, donates one or more of their human organs to another human being for human organ transplantation, except that for purposes of this subsection, “human organ” means all or part of a liver, pancreas, kidney, intestine, lung, or bone marrow. A subtract LC003371 - Page 15 of 25 modification that is claimed hereunder may be claimed in the taxable year in which the human organ transplantation occurs.
(ii) An individual may claim that subtract modification hereunder only once, and the subtract modification may be claimed for only the following unreimbursed expenses that are incurred by the claimant and related to the claimant’s organ donation:
(A) Travel expenses.
(B) Lodging expenses.
(C) Lost wages.
(iii) The subtract modification hereunder may not be claimed by a part-time resident or a nonresident of this state;
(8) Modification for taxable Social Security income.
(i) For tax years beginning on or after January 1, 2016:
(A) For a person who has attained the age used for calculating full or unreduced Social Security retirement benefits who files a return as an unmarried individual, head of household, or married filing separate whose federal adjusted gross income for the taxable year is less than eighty thousand dollars ($80,000); or
(B) A married individual filing jointly or individual filing qualifying widow(er) who has attained the age used for calculating full or unreduced Social Security retirement benefits whose joint federal adjusted gross income for the taxable year is less than one hundred thousand dollars ($100,000), an amount equal to the Social Security benefits includible in federal adjusted gross income.
(ii) Adjustment for inflation. The dollar amount contained in subsections (c)(8)(i)(A) and (c)(8)(i)(B) of this section shall be increased annually by an amount equal to:
(A) Such dollar amount contained in subsections (c)(8)(i)(A) and (c)(8)(i)(B) of this section adjusted for inflation using a base tax year of 2000, multiplied by;
(B) The cost-of-living adjustment with a base year of 2000.
(iii) For the purposes of this section the cost-of-living adjustment for any calendar year is the percentage (if any) by which the consumer price index for the preceding calendar year exceeds the consumer price index for the base year. The consumer price index for any calendar year is the average of the consumer price index as of the close of the twelve-month (12) period ending on August 31, of such calendar year.
(iv) For the purpose of this section the term “consumer price index” means the last consumer price index for all urban consumers published by the department of labor. For the purpose of this section the revision of the consumer price index which is most consistent with the consumer LC003371 - Page 16 of 25 price index for calendar year 1986 shall be used.
(v) If any increase determined under this section is not a multiple of fifty dollars ($50.00), such increase shall be rounded to the next lower multiple of fifty dollars ($50.00). In the case of a married individual filing separate return, if any increase determined under this section is not a multiple of twenty-five dollars ($25.00), such increase shall be rounded to the next lower multiple of twenty-five dollars ($25.00);
(9) Modification of taxable retirement income from certain pension plans or annuities.
(i) For tax years beginning on or after January 1, 2017, until the tax year beginning January 1, 2022, a modification shall be allowed for up to fifteen thousand dollars ($15,000), and for tax years beginning on or after January 1, 2023, until the tax year beginning January 1, 2024, a modification shall be allowed for up to twenty thousand dollars ($20,000), and for tax years beginning on or after January 1, 2025, a modification shall be allowed for up to fifty thousand dollars ($50,000), of taxable pension and/or annuity income that is included in federal adjusted gross income for the taxable year:
(A) For a person who has attained the age used for calculating full or unreduced Social Security retirement benefits who files a return as an unmarried individual, head of household, or married filing separate whose federal adjusted gross income for such taxable year is less than the amount used for the modification contained in subsection (c)(8)(i)(A) of this section an amount not to exceed $15,000 for tax years beginning on or after January 1, 2017, until the tax year beginning January 1, 2022, and an amount not to exceed twenty thousand dollars ($20,000) for tax years beginning on or after January 1, 2023, until the tax year beginning January 1, 2024, and an amount not to exceed fifty thousand dollars ($50,000) for tax years beginning on or after January 1, 2025, of taxable pension and/or annuity income includible in federal adjusted gross income; or
(B) For a married individual filing jointly or individual filing qualifying widow(er) who has attained the age used for calculating full or unreduced Social Security retirement benefits whose joint federal adjusted gross income for such taxable year is less than the amount used for the modification contained in subsection (c)(8)(i)(B) of this section an amount not to exceed $15,000 for tax years beginning on or after January 1, 2017, until the tax year beginning January 1, 2022, and an amount not to exceed twenty thousand dollars ($20,000) for tax years beginning on or after January 1, 2023, until the tax year beginning January 1, 2024, and an amount not to exceed fifty thousand dollars ($50,000) for tax years beginning on or after January 1, 2025, of taxable pension and/or annuity income includible in federal adjusted gross income.
(ii) Adjustment for inflation. The dollar amount contained by reference in subsections LC003371 - Page 17 of 25 (c)(9)(i)(A) and (c)(9)(i)(B) of this section shall be increased annually for tax years beginning on or after January 1, 2018, by an amount equal to:
(A) Such dollar amount contained by reference in subsections (c)(9)(i)(A) and (c)(9)(i)(B) of this section adjusted for inflation using a base tax year of 2000, multiplied by;
(B) The cost-of-living adjustment with a base year of 2000.
(iii) For the purposes of this section, the cost-of-living adjustment for any calendar year is the percentage (if any) by which the consumer price index for the preceding calendar year exceeds the consumer price index for the base year. The consumer price index for any calendar year is the average of the consumer price index as of the close of the twelve-month (12) period ending on August 31, of such calendar year.
(iv) For the purpose of this section, the term “consumer price index” means the last consumer price index for all urban consumers published by the department of labor. For the purpose of this section, the revision of the consumer price index which is most consistent with the consumer price index for calendar year 1986 shall be used.
(v) If any increase determined under this section is not a multiple of fifty dollars ($50.00), such increase shall be rounded to the next lower multiple of fifty dollars ($50.00). In the case of a married individual filing a separate return, if any increase determined under this section is not a multiple of twenty-five dollars ($25.00), such increase shall be rounded to the next lower multiple of twenty-five dollars ($25.00).
(vi) For tax years beginning on or after January 1, 2022, the dollar amount contained by reference in subsection (c)(9)(i)(A) shall be adjusted to equal the dollar amount contained in subsection (c)(8)(i)(A), as adjusted for inflation, and the dollar amount contained by reference in subsection(c)(9)(i)(B) shall be adjusted to equal the dollar amount contained in subsection (c)(8)(i)(B), as adjusted for inflation;
(10) Modification for Rhode Island investment in opportunity zones. For purposes of a taxpayer’s state tax liability, in the case of any investment in a Rhode Island opportunity zone by the taxpayer for at least seven (7) years, a modification to income shall be allowed for the incremental difference between the benefit allowed under 26 U.S.C. § 1400Z-2(b)(2)(B)(iv) and the federal benefit allowed under 26 U.S.C. § 1400Z-2(c);
(11) Modification for military service pensions.
(i) For purposes of a taxpayer’s state tax liability, a modification to income shall be allowed as follows:
(A) For the tax years beginning on January 1, 2023, a taxpayer may subtract from federal adjusted gross income the taxpayer’s military service pension benefits included in federal adjusted LC003371 - Page 18 of 25 gross income;
(ii) As used in this subsection, the term “military service” shall have the same meaning as set forth in 20 C.F.R. § 212.2;
(iii) At no time shall the modification allowed under this subsection alone or in conjunction with subsection (c)(9) exceed the amount of the military service pension received in the tax year for which the modification is claimed;
(12) Any rebate issued to the taxpayer pursuant to § 44-30-103 to the extent included in gross income for federal tax purposes; and
(13) For tax years beginning on or after January 1, 2025, in the case of a taxpayer that is licensed in accordance with chapters 28.6 and/or 28.11 of title 21, the amount equal to any expenditure that is eligible to be claimed as a federal income tax deduction but is disallowed under 26 U.S.C. § 280E; and
(14) The amount received from public pension benefits administered by the Employees Retirement System of Rhode Island.
(d) Modification for Rhode Island fiduciary adjustment. There shall be added to, or subtracted from, federal adjusted gross income (as the case may be) the taxpayer’s share, as beneficiary of an estate or trust, of the Rhode Island fiduciary adjustment determined under § 44- 30-17.
(e) Partners. The amounts of modifications required to be made under this section by a partner, which relate to items of income or deduction of a partnership, shall be determined under § 44-30-15.

SECTION 4. Section 45-21-52 of the General Laws in Chapter 45-21 entitled "Retirement of Municipal Employees" is hereby amended to read as follows:
45-21-52. Automatic increase in service retirement allowance.
(a) The local legislative bodies of the cities and towns may extend to their respective employees automatic adjustment increases in their service retirement allowances, by a resolution accepting any of the plans described in this section:
(1) Plan A. All employees and beneficiaries of those employees receiving a service retirement or disability retirement allowance under the provisions of this chapter on December 31 of the year their city or town accepts this section, receive a cost of living adjustment equal to one and one-half percent (1.5%) per year of the original retirement allowance, not compounded, for each calendar year the retirement allowance has been in effect. This cost of living adjustment is added to the amount of the retirement allowance as of January 1 following acceptance of this provision, and an additional one and one-half percent (1.5%) is added to the original retirement LC003371 - Page 19 of 25 allowance in each succeeding year during the month of January, and provided, further, that this additional cost of living increase is three percent (3%) for the year beginning January 1 of the year the plan is accepted and each succeeding year.
(2) Plan B. All employees and beneficiaries of those employees receiving a retirement allowance under the provisions of this chapter on December 31 of the year their municipality accepts this section, receive a cost of living adjustment equal to three percent (3%) of their original retirement allowance. This adjustment is added to the amount of the retirement allowance as of January 1 following acceptance of this provision, and an additional three percent (3%) of the original retirement allowance, not compounded, is payable in each succeeding year in the month of January.
(3) Plan C. All employees and beneficiaries of those employees who retire on or after January 1 of the year following acceptance of this section, on the first day of January next following the date of the retirement, receive a cost of living adjustment in an amount equal to three percent (3%) of the original retirement allowance.
(b) In each succeeding year in the month of January, the retirement allowance is increased an additional three percent (3%) of the original retirement allowance, not compounded.
(c) This subsection (c) shall be effective for the period July 1, 2012, through June 30, 2015.
(1) Notwithstanding any other subsections of this section, and subject to subsection (c)(2) below, for all present and former employees, active and retired members, and beneficiaries receiving any retirement, disability or death allowance or benefit of any kind by reason of adoption of this section by their employer, the annual benefit adjustment provided in any calendar year under this section shall be equal to (A) multiplied by (B) where (A) is equal to the percentage determined by subtracting five and one-half percent (5.5%) (the “subtrahend”) from the Five-Year Average Investment Return of the retirement system determined as of the last day of the plan year preceding the calendar year in which the adjustment is granted, said percentage not to exceed four percent (4%) and not to be less than zero percent (0%), and (B) is equal to the lesser of the member’s retirement allowance or the first twenty-five thousand dollars ($25,000) of retirement allowance, such twenty-five thousand dollars ($25,000) amount to be indexed annually in the same percentage as determined under (c)(1)(A) above. The “Five-Year Average Investment Return” shall mean the average of the investment returns of the most recent five (5) plan years as determined by the retirement board. Subject to subsection (c)(2) below, the benefit adjustment provided by this subsection (c)(1) shall commence upon the third (3rd) anniversary of the date of retirement or the date on which the retiree reaches their Social Security retirement age, whichever is later; or for municipal police and fire retiring under the provisions of chapter 21.2 of this title, the benefit LC003371 - Page 20 of 25 adjustment provided by this subsection (c)(1) shall commence on the later of the third (3rd) anniversary of the date of retirement or the date on which the retiree reaches age fifty-five (55). In the event the retirement board adjusts the actuarially assumed rate of return for the system, either upward or downward, the subtrahend shall be adjusted either upward or downward in the same amount.
(2) Except as provided in subsection (c)(3) the benefit adjustments provided under this section for any plan year shall be reduced to twenty-five percent (25%) of the benefit adjustment for each municipal plan within the municipal employees’ retirement system unless the municipal plan is determined to be funded at a Funded Ratio equal to or greater than eighty percent (80%) as of the end of the immediately preceding plan year in accordance with the retirement system’s actuarial valuation report as prepared by the system’s actuary, in which event the benefit adjustment will be reinstated for all members for such plan year.
In determining whether a funding level under this subsection (c)(2) has been achieved, the actuary shall calculate the funding percentage after taking into account the reinstatement of any current or future benefit adjustment provided under this section.
(3) Notwithstanding subsection (c)(2), for each municipal plan that has a Funded Ratio of less than eighty percent (80%) as of June 30, 2012, in each fifth plan year commencing after June 30, 2012, commencing with the plan year ending June 30, 2017, and subsequently at intervals of five (5) plan years, a benefit adjustment shall be calculated and made in accordance with subsection (c)(1) above until the municipal plan’s Funded Ratio exceeds eighty percent (80%).
(d) This subsection (d) shall become effective July 1, 2015.
(1)(A) As soon as administratively reasonable following the enactment into law of this subsection (d)(1)(A), a one-time benefit adjustment shall be provided to members and/or beneficiaries of members who retired on or before June 30, 2012, in the amount of two percent (2%) of the lesser of either the employee’s retirement allowance or the first twenty-five thousand dollars ($25,000) of the member’s retirement allowance. This one-time benefit adjustment shall be provided without regard to the retiree’s age or number of years since retirement.
(B) Notwithstanding the prior subsections of this section, for all present and former employees, active and retired employees, and beneficiaries receiving any retirement, disability or death allowance or benefit of any kind by reason of adoption of this section by their employer, the annual benefit adjustment provided in any calendar year under this section for adjustments on and after January 1, 2016, and subject to subsection (d)(2) below, shall be equal to (I) multiplied by (II):
(I) shall equal the sum of fifty percent (50%) of (i) plus fifty percent (50%) of (ii) where: LC003371 - Page 21 of 25
(i) is equal to the percentage determined by subtracting five and one-half percent (5.5%) (the “subtrahend”) from the five-year average investment return of the retirement system determined as of the last day of the plan year preceding the calendar year in which the adjustment is granted, said percentage not to exceed four percent (4%) and not to be less than zero percent (0%). The “five-year average investment return” shall mean the average of the investment returns of the most recent five (5) plan years as determined by the retirement board. In the event the retirement board adjusts the actuarially assumed rate of return for the system, either upward or downward, the subtrahend shall be adjusted either upward or downward in the same amount.
(ii) is equal to the lesser of three percent (3%) or the percentage increase in the Consumer Price Index for All Urban Consumers (CPI-U) as published by the U.S. Department of Labor Statistics determined as of September 30 of the prior calendar year.
In no event shall the sum of (i) plus (ii) exceed three and one-half percent (3.5%) or be less than zero percent (0%).
(II) is equal to the lesser of either the member’s retirement allowance or the first twenty- five thousand eight hundred and fifty-five dollars ($25,855) of retirement allowance, such amount to be indexed annually in the same percentage as determined under (d)(1)(B)(I) above.
The benefit adjustments provided by this subsection (d)(1)(B) shall be provided to all retirees entitled to receive a benefit adjustment as of June 30, 2012, under the law then in effect, and for all other retirees the benefit adjustments shall commence upon the third anniversary of the date of retirement or the date on which the retiree reaches their Social Security retirement age, whichever is later; or for municipal police and fire retiring under the provisions of § 45-21.2- 5(b)(1)(A), the benefit adjustment provided by this subsection (d)(1)(B) shall commence on the later of the third anniversary of the date of retirement or the date on which the retiree reaches age fifty-five (55); or for municipal police and fire retiring under the provisions of § 45-21.2-5(b)(1)(B), the benefit adjustment provided by this subsection (d)(1)(B) shall commence on the later of the third anniversary of the date of retirement or the date on which the retiree reaches age fifty (50).
(2) Except for municipal employees and/or beneficiaries of municipal employees who retired on or before June 30, 2012, the benefit adjustments under subsection (d)(1)(B) for any plan year shall be reduced to twenty-five percent (25%) of the benefit adjustment for each municipal plan within the municipal employees’ retirement system unless the municipal plan is determined to be funded at a funded ratio equal to or greater than eighty percent (80%) as of the end of the immediately preceding plan year in accordance with the retirement system’s actuarial valuation report as prepared by the system’s actuary, in which event the benefit adjustment will be reinstated for all members for such plan year. Effective July 1, 2024, the funded ratio for each municipal plan LC003371 - Page 22 of 25 within the municipal employees’ retirement system, calculated by the system’s actuary, of equal to or greater than eighty percent (80%) for the benefit adjustment to be reinstated for all members for such plan year shall be replaced with seventy-five percent (75%). For plan year 2026, eligible retirees who retired after July 1, 2012, shall receive a one-time full COLA of two and eighty-nine one hundredths percent (2.89%).
In determining whether a funding level under this subsection (d)(2) has been achieved, the actuary shall calculate the funding percentage after taking into account the reinstatement of any current or future benefit adjustment provided under this section.
(3) Effective for members and/or beneficiaries of members who retired after June 30, 2012, or on or before June 30, 2015, the dollar amount in (d)(1)(B)(II) of twenty-five thousand eight hundred and fifty-five dollars ($25,855) shall be replaced with thirty-one thousand and twenty-six dollars ($31,026) until the municipal plan’s funded ratio exceeds eighty percent (80%). Effective July 1, 2024, the funded ratio for each municipal plan within the municipal employees’ retirement system, calculated by the system’s actuary, of exceeding eighty percent (80%) for the benefit adjustment to be reinstated for all members for such plan year shall be replaced with seventy-five percent (75%).
(e) Upon acceptance of any of the plans in this section, each employee shall on January 1 next succeeding the acceptance, contribute by means of salary deductions, pursuant to § 45-21-41, one percent (1%) of the employee’s compensation concurrently with and in addition to contributions otherwise being made to the retirement system.
(f) The city or town shall make any additional contributions to the system, pursuant to the terms of § 45-21-42, for the payment of any benefits provided by this section.
(g) The East Greenwich town council shall be allowed to accept Plan C of subsection (a)(3) of this section for all employees of the town of East Greenwich who either, pursuant to contract negotiations, bargain for Plan C, or who are non-union employees who are provided with Plan C and who shall all collectively be referred to as the “Municipal-COLA Group” and shall be separate from all other employees of the town and school department, union or non-union, who are in the same pension group but have not been granted Plan C benefits. Upon acceptance by the town council, benefits in accordance with this section shall be available to all such employees who retire on or after January 1, 2003.
(h) Effective for members and/or beneficiaries of members who have retired on or before July 1, 2015, and without regard to whether the retired member or beneficiary is receiving a benefit adjustment under this section, a one-time stipend of five hundred dollars ($500) shall be payable within sixty (60) days following the enactment of the legislation implementing this provision, and LC003371 - Page 23 of 25 a second one-time stipend of five hundred dollars ($500) in the same month of the following year. These stipends shall not be considered cost of living adjustments under the prior provisions of this section.

SECTION 5. This act shall take effect upon passage.