2011 -- H 5712

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LC01169

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STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2011

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A N A C T

RELATING TO TOWNS AND CITIES -- RHODE ISLAND INTERLOCAL REGIONAL

SERVICES COMMISSION

     Introduced By: Representatives Brien, Trillo, Martin, Edwards, and Silva

     Date Introduced: March 03, 2011

     Referred To: House Municipal Government

It is enacted by the General Assembly as follows:

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     SECTION 1. Chapter 45-40.1 of the General Laws entitled "Interlocal Contracting and

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Joint Enterprises" is hereby amended by adding thereto the following sections:

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     45-40.1-9. Establishment of commission - Purpose. -- (a) There is hereby authorized,

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created, and established a public corporation of the state having a distinct legal existence from the

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state and not constituting a department of state government to be known as "The Rhode Island

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Interlocal Regional Services Commission," with such powers as are set forth in this chapter, for

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the purposes of operating and administering various municipal operations which encompass two

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(2) or more adjacent municipalities.

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     (b) It is the intent of the general assembly, by the passage of this chapter, to vest in the

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commission all powers, authority, rights, privileges, and titles which may be necessary to enable

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it to accomplish the purposes herein set forth, and this chapter and the powers herein granted shall

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be liberally construed in conformity with those purposes.

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     (c) The commission and its corporate existence shall continue until terminated by law.

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Upon termination of the existence of the commission, all its rights and properties shall pass to and

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be vested in the state, and, in accordance with law, the governor may permit whatever rights and

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properties he or she shall see fit to pass to municipalities located within the district, if the

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municipality or municipalities accept the rights or properties.

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     45-40.1-10. General powers. -- The Rhode Island interlocal regional services

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commission shall have the following powers, together with all powers incidental thereto or

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necessary for the performance of those stated in this chapter:

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     (1) To sue and be sued, complain and defend, in its corporate name.

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     (2) To have a seal which may be altered at pleasure and to use the seal by causing it, or a

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facsimile thereof, to be impressed or affixed or in any other manner reproduced.

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     (3) To purchase, take, receive, lease, or otherwise acquire, own, hold, improve, use, and

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otherwise deal in and with, real or personal property, or any interest therein, wherever situated.

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     (4) To make and execute agreements of lease, construction contracts, operation contracts,

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and all other contracts and instruments necessary or convenient in the exercise of the powers and

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functions of the commission granted by this chapter.

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     (5) To make guarantees and incur or assume liabilities as the commission may deem

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appropriate.

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     (6) To invest and reinvest its funds.

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     (7) To secure the cooperation and assistance of the United States, and any of its agencies,

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and of agencies of this state and its municipalities in the work of the commission.

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     (8) To accept grants, donations, drafts, loans of funds, and contributions in money,

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services, materials, or otherwise, from the United States or any of its agencies, from this state and

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its agencies, or from any other source, and to use or expend those moneys, services, materials, or

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other contributions in carrying out the purposes of this chapter.

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     (9) To make assessments and impose reasonable and just user charges, and to pay for

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such expenses as may be required by law or as may be determined by the commission to be

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necessary for the maintenance and operation of the project.

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     (10) To operate and administer various municipal operations which encompass two (2) or

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more adjacent municipalities. Such operations may include, but shall not be limited to, tax

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collection or assessment activities, public works operations sewer and water treatment and

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distribution systems, police services, library services, and fire and rescue services.

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     (11) To acquire or contract to acquire, from any person, the federal government or the

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state, or any agency of either the federal government or state, by grant, purchase, lease, gift,

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condemnation, or otherwise, or to obtain options for the acquisition of any property, real or

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personal, improved or unimproved, and interests in land less than the fee thereof; and to own,

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hold, clear, improve, develop, and rehabilitate, and to sell, assign, exchange, transfer, convey,

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lease, mortgage, or otherwise dispose of or encumber the property for the purposes of carrying

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out the provisions and intent of this chapter for such consideration as the commission shall

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determine.

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     (12) To elect or appoint officers and agents of the commission, and to define their duties

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and fix their compensation, including authority to employ attorneys, accountants, architectural,

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and engineering consultants, and such other employees or agents as the commission shall deem

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necessary in its judgment.

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     (13) To make and alter bylaws, not inconsistent with this chapter, for the administration

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and regulation of the affairs of the commission, and the bylaws may contain provisions

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indemnifying any person who is or was a director or a member of the commission, in the manner

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and to the extent provided in section 7-1.2-814.

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     (14) To construct, acquire, repair, develop, own, operated, maintain, extend, improve,

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rehabilitate, renovate, equip, and furnish a project and make provision for its management.

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     (15) To prepare or cause to be prepared plans, specifications, designs, and estimates of

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costs of construction, reconstruction, rehabilitations, improvement, alteration, or repair of a

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project, and to modify the same.

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     (16) To issue orders of general or specific applicability to carry out the purposes of the

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project.

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     (17) To have and exercise all powers necessary or convenient to effect its purposes.

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     (18) To impose administrative penalties to the same degree and extent as the Narragansett

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Bay Commission in accordance with the provisions of section 46-25-25.4.

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     (19) To secure certain payments on its revenue bonds and notes, in whole or in part, by

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insurance or by letters or lines of credit or other credit facilities.

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     (20) To enter into agreements, contracts, and other arrangements with the state and any of

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its departments, agencies, boards or commissions relating to the execution or performance of any

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function or purpose of the commission, including, but not limited to, investments, employee

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compensation and employee benefits, and the state and its departments, agencies, boards and

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commissions are hereby authorized to enter into such agreements, contracts and other

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arrangements with the commission, and upon the request of the commission shall enter into such

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agreements, contracts and other arrangements with the commission.

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     45-40.1-11. Composition of commission - Appointment of members. -- (a) The

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commission shall consist of five (5) members. The director of the department of administration or

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designee, the director of the department of revenue or designee, the executive director of the

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Rhode Island league of cities and towns or designee, the president of the Rhode Island city and

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town managers association or designee, and one public member to be appointed by the governor.

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In addition, one additional member shall be appointed from each city or town which is party to a

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joint agreement and those members shall participate and have voting rights on all issues relating

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to agreements affecting their city or town.

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     45-40.1-12. Regional project. -- By resolution of two (2) or more city or town councils,

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the commission shall be authorized to undertake a regional program or project. Existing

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municipal employees in good standing shall have preference in employment by the commission

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and compensation and employee benefits shall be comparable to existing average compensation

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plans for municipal employees throughout the state. It is provided further, however, that

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employees of the commission shall be participants in the municipal employees retirement system

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as authorized by chapters 45-21 and 45-21.1 of the general laws relating to municipal retirement

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and shall not participate in any other employee sponsored retirement plans.

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     SECTION 2. Section 45-21-65 of the General Laws in Chapter 45-21 entitled

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"Retirement of Municipal Employees" is hereby amended to read as follows:

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     45-21-65. Other post-employment benefits -- OPEB trusts. -- (a) Notwithstanding the

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provisions of any general or special law, or the provisions of any municipality's home rule

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charter, to the contrary, for purposes of funding any unfunded liability for other post-employment

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benefits including, but not limited to, health care and dental care benefits hereinafter referred to

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as ("OPEB") in accordance with government accounting standards board statements 43 and 45, a

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municipality, acting by its treasurer or director of finance, upon an approving resolution of the

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city or town council or agency board as applicable, may enter into a trust agreement between the

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municipality and a corporate trustee which shall be a bank or trust company doing business in the

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state, or a corporation established pursuant to chapter 5 of title 45 ("Councils and Governing

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Bodies") of the general laws. This trust agreement shall be in any form deemed proper by the

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treasurer or director of finance of the municipality, and shall be executed by its treasurer or

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director of finance and countersigned by its mayor or president of the town council. It shall be

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lawful for any bank, or trust company, or entity organized pursuant to section 45-5-20.1 doing

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business in the state to act as a depository or trustee under this trust agreement, and to furnish

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indemnification and pledge securities that may be required by any municipality.

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      (b) OPEB trust funds shall be credited with all amounts appropriated or otherwise made

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available by the municipality for the purposes of meeting the current and future OPEB costs

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payable by the municipality. OPEB trust funds shall also be credited with all amounts contributed

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or otherwise made available by employees of the municipality for the purpose of meeting future

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OPEB costs payable by the municipality. Amounts in an OPEB trust fund, including any earnings

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or interest accruing from the investment of these amounts, shall be expended only for the

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payment of the costs payable by the municipality for OPEB or as otherwise permitted by the

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terms of the trust and applicable law. The director of finance or treasurer, as applicable, shall

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invest and reinvest the amounts in the OPEB trust fund not needed for current disbursement in

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any investment permitted for the municipality's pension funds consistent with the prudent person

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rule and investment policies of the municipality, if any.

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      (c) Municipalities are hereby authorized to enter into agreements, trusts, contracts, and

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other arrangements with the state and any of its departments, agencies, boards or commissions

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relating to the execution, management or operation of the OPEB trust funds, including, but not

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limited to, investments, and the state and its departments, agencies, boards and commissions are

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hereby authorized to enter into such agreements, contracts and other arrangements with

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municipalities. Notwithstanding any provisions of any general or special law or principle of

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equity to the contrary, the state shall have no liability to any municipality for entering into such

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agreements. A municipality may employ any qualified bank, trust company, corporation, firm or

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person to advise it on the investment of the OPEB trust fund and may pay from the OPEB trust

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fund for this advice and other services. Procurement for these services shall be subject to the

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procurement procedures and rules governing municipalities in the state.

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      (d) Any OPEB trusts that have been created by municipalities and are in effect on the

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date hereof are hereby ratified and confirmed.

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      (e) Nothing herein shall be construed to exempt OPEB trusts from the Rhode Island

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Access to Public Records Act, RIGL 38-2-1 et seq.

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      (f) A municipality may employ any qualified bank, trust company, corporation, firm or

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person to advise it on the investment of the OPEB trust fund and may pay from the OPEB trust

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fund for this advice and other services. Procurement for these services shall be subject to the

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procurement procedures and rules governing municipalities in the state.

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     (g) Municipalities are also hereby authorized to enter into agreements, trusts, contracts,

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and other arrangements with any corporation created pursuant to chapter 5 of title 45 ("Councils

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and Governing Bodies") of the general laws relating to the execution, management or operation

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of the OPEB trust funds, including, but not limited to, investments, and the corporations

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established pursuant to Rhode Island general laws section 45-5-20.1 are hereby authorized to

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enter into such agreements, contracts and other arrangements with municipalities.

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     SECTION 3. Section 16-2-9.5 of the General Laws in Chapter 16-2 entitled "School

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Committees and Superintendents" is hereby amended to read as follows:

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     16-2-9.5. Other post-employment benefits -- OPEB trusts. -- (a) Notwithstanding the

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provisions of any general or special law, or the provisions of any municipality's home rule

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charter, to the contrary, for purposes of funding any unfunded liability for other post-employment

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benefits including, but not limited to, health care and dental care benefits hereinafter referred to

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as ("OPEB") in accordance with government accounting standards board statements 43 and 45, a

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school district, acting by its business manager or superintendent, upon an approving resolution of

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the school committee or school board as applicable, may enter into a trust agreement between the

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school district and a corporate trustee which shall be a bank or trust company doing business in

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the state, or a corporation established pursuant to chapter 5 of title 45 ("Councils and Governing

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Bodies") of the general laws. This trust agreement shall be in any form deemed proper by the

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business manager or superintendent, and shall be executed by its business manager or

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superintendent and countersigned by the chair of the school committee of the school district. It

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shall be lawful for any bank, or trust company, or entity organized pursuant to section 45-5-20.1

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doing business in the state to act as a depository or trustee under this trust agreement, and to

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furnish indemnification and pledge securities that may be required by any school district.

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      (b) OPEB trust funds shall be credited with all amounts appropriated or otherwise made

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available by the school district for the purposes of meeting the current and future OPEB costs

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payable by the school district. OPEB trust funds shall also be credited with all amounts

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contributed or otherwise made available by employees of the school district for the purpose of

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meeting future OPEB costs payable by the school district. Amounts in an OPEB trust fund,

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including any earnings or interest accruing from the investment of these amounts, shall be

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expended only for the payment of the costs payable by the school district for OPEB or as

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otherwise permitted by the terms of the trust and applicable law. The business manager or

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superintendent, as applicable, shall invest or reinvest the amounts in the OPEB trust fund in any

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investment permitted for the state pension funds consistent with the investment policies of the

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state general treasurer's office.

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      (c) School districts are hereby authorized to enter into agreements, trusts, contracts, and

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other arrangements with the state and any of its departments, agencies, boards or commissions

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relating to the execution, management or operation of the OPEB trust funds, including, but not

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limited to, investments, and the state and its department, agencies, boards and commissions are

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hereby authorized to enter into such agreements, contracts and other arrangements with school

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districts. Notwithstanding any provisions of any general or special law or principle of equity to

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the contrary, the state shall have no liability to any school district for entering into such

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agreements. A school district may employ any qualified bank, trust company, corporation, firm or

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person to advise it on the investment of the OPEB trust fund and may pay from the OPEB trust

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fund for this advice and other services. Procurement for these services shall be subject to the

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procurement procedures and rules governing school districts in state law.

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      (d) Nothing contained herein will prevent any school district from entering into

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agreements with other school districts per section 16-2-9.2 for the purposes of jointly pooling

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their investments or collectively entering into an agreement with a corporate trustee, as defined in

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subsection (a) of this section.

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      (e) Nothing herein shall be construed to exempt OPEB trusts from the Rhode Island

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Access to Public Records Act, RIGL 38-2-1 et seq.

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      (f) A school district may employ any qualified bank, trust company, corporation, firm or

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person to advise it on the investment of the OPEB trust fund and may pay from the OPEB trust

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fund for this advice and other services. Procurement for these services shall be subject to the

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procurement procedures and rules governing school districts and municipalities in the state.

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     (g) School districts are also hereby authorized to enter into agreements, trusts, contracts,

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and other arrangements with any corporation created pursuant to chapter 5 of title 45 ("Councils

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and Governing Bodies") of the general laws relating to execution, management or operation of

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the OPEB trust funds, including, but not limited to, investments, and the corporations established

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pursuant to Rhode Island general laws section 45-5-20.1 are hereby authorized to enter into such

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agreements, contracts and other arrangements with school districts.

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     SECTION 4. Chapter 45-5 of the General Laws entitled "Councils and Governing

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Bodies" is hereby amended by adding thereto the following section:

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     45-5-20.2. Power of city and town councils and regional school districts to jointly

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establish a corporation to manage and operate OPEB trusts. -- (a) Notwithstanding the

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provisions of any general or special law to the contrary, corporations established pursuant to

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Rhode Island general laws section 45-5-20.1 also shall have the power to manage and operate

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such other post-employment benefit (OPEB) trusts as are established pursuant to Rhode Island

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general laws sections 45-21-65 and 16-2-9.5. Such corporations shall have the powers set forth in

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Rhode Island general laws section 45-5-20.1, and shall have such additional powers as are

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necessary to effectuate the purposes of this section.

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     (b) For the purpose of OPEB trusts managed and operated pursuant to this section, the

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corporation shall maintain discrete sub-trust accounts for each of the participating entities setting

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forth the contributions made by each participating entity, the allocated income assigned to each

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participating entity as it may be derived from investments and other revenue sources, the funds

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distributed to each participating entity for use in meeting its OPEB obligations, each entity's

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allocated share of the administrative costs, including investment management fees, for operating

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the OPEB trust, and such other items as the directors of the corporation hereby established shall

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deem proper and necessary. Agreements made pursuant to this section may provide for pooling of

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administrative expenses, including investment management and advisory services, associated

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with the operation of the OPEB trust and sub-trusts.

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     SECTION 5. This act shall take effect upon passage.

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LC01169

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N A C T

RELATING TO TOWNS AND CITIES -- RHODE ISLAND INTERLOCAL REGIONAL

SERVICES COMMISSION

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     This act would establish a public corporation to be known as "The Rhode Island

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Interlocal Regional Services Commission." The purpose of the commission would be to operate

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and administer various municipal operations which encompass two (2) or more adjacent

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municipalities.

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     This act would take effect upon passage.

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LC01169

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