2026 -- H 7500

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LC004876

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2026

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A N   A C T

RELATING TO EDUCATION -- TEACHERS' RETIREMENT

     Introduced By: Representatives Shanley, Bennett, Voas, Stewart, and Casimiro

     Date Introduced: February 04, 2026

     Referred To: House Finance

     It is enacted by the General Assembly as follows:

     SECTION 1. Section 16-16-13 of the General Laws in Chapter 16-16 entitled "Teachers’

Retirement [See Title 16 Chapter 97 — The Rhode Island Board of Education Act]" is hereby

amended to read as follows:

     16-16-13. Amount of service retirement allowance.

     (a)(1)(i) For teachers eligible to retire on or before September 30, 2009, upon retirement

from service under § 16-16-12 a teacher whose membership commenced before July 1, 2005, and

who has completed at least ten (10) years of contributory service on or before July 1, 2005, shall

receive a retirement allowance which shall be determined in accordance with schedule A for service

prior to July 1, 2012.

SCHEDULE A

YEARS OF SERVICE PERCENTAGE ALLOWANCE

1st through 10th inclusive 1.7%

11th through 20th inclusive 1.9%

21st through 34th inclusive 3.0%

35th 2.0%

     (ii) For teachers eligible to retire on or after October 1, 2009, who were not eligible to retire

on or before September 30, 2009, upon retirement for service under § 16-16-12, a teacher whose

membership commenced before July 1, 2005, and who has completed at least ten (10) years of

contributory service on or before July 1, 2005, shall receive a retirement allowance which shall be

determined in accordance with schedule A above for service on before September 30, 2009, and

shall be determined in accordance with schedule B in subsection (a)(2) below for service on or after

October 1, 2009, and prior to July 1, 2012.

     (2) Upon retirement from service under § 16-16-12 a teacher whose membership

commenced after July 1, 2005, or who has not completed at least ten (10) years of contributory

service as of July 1, 2005, shall receive a retirement allowance which shall be determined in

accordance with Schedule B for service prior to July 1, 2012.

SCHEDULE B

YEARS OF SERVICE PERCENTAGE ALLOWANCE

1st through 10th inclusive 1.60%

11th through 20th inclusive 1.80%

21st through 25th inclusive 2.0%

26th through 30th inclusive 2.25%

31st through 37th inclusive 2.50%

38th 2.25%

     (b) The retirement allowance of any teacher whose membership commenced before July 1,

2005, and who has completed at least ten (10) years of contributory service on or before July 1,

2005, shall be in an amount equal to the percentage allowance specified in subsection (a)(1) of the

member’s average highest three (3) consecutive years of compensation multiplied by the number

of years of total service, but in no case to exceed eighty percent (80%) of the compensation, payable

at completion of thirty-five (35) years of service; provided, however, for teachers retiring on or

after October 1, 2009, who were not eligible to retire as of September 30, 2009, the calculation

shall be based on the average highest five (5) consecutive years of compensation; provided,

however for teachers retiring on or after July 1, 2024 2009, the calculation shall be based on the

average highest three (3) consecutive years of compensation; provided, however for teachers

retiring on or after July 1, 2024, the calculation shall be based on the average highest three (3)

consecutive years of compensation.

     The retirement allowance of any teacher whose membership commenced after July 1, 2005,

or who has not completed at least ten (10) years of contributory service as of July 1, 2005, shall be

in an amount equal to the percentage allowance specified in Schedule B of the member’s average

highest three (3) consecutive years of compensation multiplied by the number of years of total

service, but in no case to exceed seventy-five percent (75%) of the compensation, payable at

completion of thirty-eight (38) years of service; provided, however, for teachers retiring on or after

October 1, 2009, who were not eligible to retire as of September 30, 2009, the calculation shall be

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based on the average highest five (5) consecutive years of compensation; provided, however, for

teachers retiring on or after July 1, 2024 2012, the calculation shall be based on the average highest

three (3) consecutive years of compensation; provided, however for teachers retiring on or after

July 1, 2024, the calculation shall be based on the average highest three (3) consecutive years of

compensation.

     Any teacher who has in excess of thirty-five (35) years on or before June 2, 1985, shall not

be entitled to any refund, and any teacher with thirty-five (35) years or more on or after June 2,

1985, shall contribute from July 1, 1985, until their retirement.

     (c) For service prior to July 2012, the retirement allowance of a teacher shall be determined

in accordance with subsections (a)(1) and (a)(2) above. For service on and after July 1, 2012:

     (i) For teachers with fewer than twenty (20) years of total service as of June 30, 2012, a

teacher’s retirement allowance shall be equal to one percent (1%) of the teacher’s average

compensation multiplied by the teacher’s years of total service on and after July 1, 2012; and

     (ii) For teachers with twenty (20) or more years of total service as of June 30, 2012, a

teacher’s retirement allowance shall be equal to one percent (1%) of the teacher’s average

compensation multiplied by the teacher’s years of total service between July 1, 2012, and June 30,

2015, and two percent (2%) of the teacher’s average compensation multiplied by the teacher’s years

of total service on and after July 1, 2015. For purposes of computing a teacher’s total service under

the preceding sentence, service purchases shall be included in total service only with respect to

those service purchases approved prior to June 30, 2012, and those applications for service

purchases received by the retirement system on or before June 30, 2012. In no event shall a

teacher’s retirement allowance exceed the maximum limitations set forth in subsection (b) above.

     SECTION 2. Section 36-8-1 of the General Laws in Chapter 36-8 entitled "Retirement

System — Administration" is hereby amended to read as follows:

     36-8-1. Definition of terms.

     The following words and phrases as used in chapters 8 to 10 of this title unless a different

meaning is plainly required by the context, shall have the following meanings:

     (1) “Accumulated contributions” shall mean the sum of all the amounts deducted from the

compensation of a member and credited to their individual pension account.

     (2) “Active member” shall mean any employee of the state of Rhode Island as defined in

this section for whom the retirement system is currently receiving regular contributions pursuant to

§§ 36-10-1 and 36-10-1.1.

     (3) “Actuarial equivalent” shall mean an allowance or benefit of equal value to any other

allowance or benefit when computed upon the basis of the actuarial tables in use by the system.

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     (4) “Annuity reserve” shall mean the present value of all payments to be made on account

of any annuity, benefit, or retirement allowance granted under the provisions of chapter 10 of this

title computed upon the basis of such mortality tables as shall be adopted from time to time by the

retirement board with regular interest.

     (5)(a) “Average compensation” for members eligible to retire as of September 30, 2009,

shall mean the average of the highest three (3) consecutive years of compensation, within the total

service when the average compensation was the highest. For members eligible to retire on or after

October 1, 2009, “Average compensation” shall mean the average of the highest five (5)

consecutive years of compensation within the total service when the average compensation was the

highest.

     (b) For members eligible to and who retire on or after July 1, 2024 2009, “average

compensation” means the average of the highest three (3) consecutive years of compensation within

the total service when the average compensation was the highest.

     (c) For members who become eligible to retire on or after July 1, 2012, if more than one-

half (½) of the member’s total years of service consist of years of service during which the member

devoted less than thirty (30) business hours per week to the service of the state, but the member’s

average compensation consists of three (3) or more years during which the member devoted more

than thirty (30) business hours per week to the service of the state, such member’s average

compensation shall mean the average of the highest ten (10) consecutive years of compensation

within the total service when the average compensation was the highest; provided however,

effective July 1, 2015, if such member’s average compensation as defined in subsection (a) above

is equal to or less than thirty-five thousand dollars ($35,000), such amount to be indexed annually

in accordance with § 36-10-35(h)(1)(B), such member’s average compensation shall mean the

greater of: (i) The average of the highest ten (10) consecutive years of compensation within the

total service when the average compensation was the highest; or (ii) The member’s average

compensation as defined in subsection (a) above. To protect a member’s accrued benefit on June

30, 2012, under this § 36-8-1(5)(c), in no event shall a member’s average compensation be lower

than the member’s average compensation determined as of June 30, 2012.

     (6) “Beneficiary” shall mean any person in receipt of a pension, an annuity, a retirement

allowance, or other benefit as provided by chapter 10 of this title.

     (7) “Casual employee” shall mean those persons hired for a temporary period, a period of

emergency, or an occasional period.

     (8) “Compensation” as used in chapters 8 — 10 of this title, chapters 16 and 17 of title 16,

and chapter 21 of title 45 shall mean salary or wages earned and paid for the performance of duties

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for covered employment, including regular longevity or incentive plans approved by the board, but

shall not include payments made for overtime or any other reason other than performance of duties,

including but not limited to the types of payments listed below:

     (i) Payments contingent on the employee having terminated or died;

     (ii) Payments made at termination for unused sick leave, vacation leave, or compensatory

time;

     (iii) Payments contingent on the employee terminating employment at a specified time in

the future to secure voluntary retirement or to secure release of an unexpired contract of

employment;

     (iv) Individual salary adjustments which are granted primarily in anticipation of the

employee’s retirement;

     (v) Additional payments for performing temporary or extra duties beyond the normal or

regular work day or work year.

     (9) “Employee” shall mean any officer or employee of the state of Rhode Island whose

business time is devoted exclusively to the services of the state, but shall not include one whose

duties are of a casual or seasonal nature. The retirement board shall determine who are employees

within the meaning of this chapter. The governor of the state, the lieutenant governor, the secretary

of state, the attorney general, the general treasurer, and the members of the general assembly, ex

officio, shall not be deemed to be employees within the meaning of that term unless and until they

elect to become members of the system as provided in § 36-9-6, but in no case shall it deem as an

employee, for the purposes of this chapter, any individual who devotes less than twenty (20)

business hours per week to the service of the state, and who receives less than the equivalent of

minimum wage compensation on an hourly basis for their services, except as provided in § 36-9-

24. Any commissioner of a municipal housing authority or any member of a part-time state,

municipal, or local board, commission, committee, or other public authority shall not be deemed to

be an employee within the meaning of this chapter.

     (10) “Full actuarial costs” or “full actuarial value” shall mean the lump sum payable by a

member claiming service credit for certain employment for which that payment is required which

is determined according to the age of the member and the employee’s annual rate of compensation

at the time the member applies for service credit and which is expressed as a rate percent of the

employee’s annual rate of compensation to be multiplied by the number of years for which the

member claims service credit as prescribed in a schedule adopted by the retirement board from time

to time on the basis of computation by the actuary. Except as provided in §§ 16-16-7.1, 36-5-3, 36-

9-31, 36-10-10.4, 45-21-53, 36-10-8, 45-21-29, 8-3-16(c), 8-8-10.1(c), 42-28-22.1(d), and 28-30-

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18.1(c):

     (i) All service credit purchases requested after June 16, 2009, and prior to July 1, 2012,

shall be at full actuarial value; and

     (ii) All service credit purchases requested after June 30, 2012, shall be at full actuarial

value which shall be determined using the system’s assumed investment rate of return minus one

percent (1%).

     The rules applicable to a service credit purchase shall be the rules of the retirement system

in effect at the time the purchase application is submitted to the retirement system.

     (11) “Funded ratio” shall mean the ratio of the actuarial value of assets to the actuarial

accrued liability consistent with the funding policy of the retirement board as defined in § 36-8-4.

     (12) “Inactive member” shall mean a member who has withdrawn from service as an

employee but who has not received a refund of contributions.

     (13) “Members” shall mean any person included in the membership of the retirement

system as provided in §§ 36-9-1 — 36-9-7.

     (14) “Prior service” shall mean service as a member rendered before July 1, 1936, certified

on the member’s prior service certificate and allowable as provided in § 36-9-28.

     (15) “Regular interest” shall mean interest at the assumed investment rate of return,

compounded annually, as may be prescribed from time to time by the retirement board.

     (16) “Retirement allowance” shall mean annual payments for life made after retirement

under and in accordance with chapters 8 to 10 of this title. All allowances shall be paid in equal

monthly installments beginning as of the effective date thereof; provided, that a smaller pro rata

amount may be paid for part of a month where separation from service occurs during the month in

which the application was filed, and when the allowance ceases before the last day of the month.

     (17) “Retirement board” or “board” shall mean the board provided in § 36-8-3 to administer

the retirement system.

     (18) “Retirement system” shall mean the employees’ retirement system of the state of

Rhode Island as defined in § 36-8-2.

     (19) “Service” shall mean service as an employee of the state of Rhode Island as described

in subdivision (9) of this section.

     (20) “Social Security retirement age” shall mean a member’s full retirement age as

determined in accordance with the federal Old Age, Survivors and Disability Insurance Act, not to

exceed age sixty-seven (67).

     (21) “Total service” shall mean prior service as defined above, plus service rendered as a

member on or after July 1, 1936.

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     SECTION 3. Section 45-21-2 of the General Laws in Chapter 45-21 entitled "Retirement

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

     45-21-2. Definitions.

     The following words and phrases as used in this chapter have the following meanings

unless a different meaning is plainly required by the context:

     (1) “Accumulated contributions” means the sum of all amounts deducted from the

compensation of a member and credited to the member’s individual account in the members’

contribution reserve account.

     (2) “Active member” means any employee of a participating municipality as defined in this

section for whom the retirement system is currently receiving regular contributions pursuant to §

45-21-41, § 45-21-41.1, or § 45-21.2-14.

     (3) “Actuarial reserve” means the present value of all payments to be made on account of

any annuity, retirement allowance, or benefit, computed upon the basis of mortality tables adopted

by the retirement board with regular interest.

     (4) “Beneficiary” means any person in receipt of a retirement allowance, annuity, or other

benefit as provided by this chapter.

     (5) For purposes of this chapter, “domestic partner” shall be defined as a person who, prior

to the decedent’s death, was in an exclusive, intimate, and committed relationship with the

decedent, and who certifies by affidavit that their relationship met the following qualifications:

     (i) Both partners were at least eighteen (18) years of age and were mentally competent to

contract;

     (ii) Neither partner was married to anyone else;

     (iii) Partners were not related by blood to a degree which would prohibit marriage in the

state of Rhode Island;

     (iv) Partners resided together and had resided together for at least one year at the time of

death; and

     (v) Partners were financially interdependent as evidenced by at least two (2) of the

following:

     (A) Domestic partnership agreement or relationship contract;

     (B) Joint mortgage or joint ownership of primary residence;

     (C) Two (2) of: (I) Joint ownership of motor vehicle; (II) Joint checking account; (III) Joint

credit account; (IV) Joint lease; and/or

     (D) The domestic partner had been designated as a beneficiary for the decedent’s will,

retirement contract, or life insurance.

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     (6) “Effective date of participation” means the date on which the provisions of this chapter

have become applicable to a municipality accepting the provisions of the chapter in the manner

stated in § 45-21-4.

     (7) “Employee” means any regular and permanent employee or officer of any municipality,

whose business time at a minimum of twenty (20) hours a week is devoted to the service of the

municipality, including elective officials and officials and employees of city and town housing

authorities. Notwithstanding the previous sentence, the term “employee,” for the purposes of this

chapter, does not include any person whose duties are of a casual or seasonal nature. The retirement

board shall decide who are employees within the meaning of this chapter, but in no case shall it

deem as an employee any individual who annually devotes less than twenty (20) business hours per

week to the service of the municipality and who receives less than the equivalent of minimum wage

compensation on an hourly basis for their services, except as provided in § 45-21-14.1 [repealed].

Casual employees mean those persons hired for an occasional period or a period of emergency to

perform special jobs or functions not necessarily related to the work of regular employees. Any

commissioner of a municipal housing authority, or any member of a part-time state board

commission, committee, or other authority is not deemed to be an employee within the meaning of

this chapter.

     (8)(a) “Final compensation” for members who are eligible to retire on or prior to June 30,

2012, means the average annual compensation, pay, or salary of a member for services rendered

during the period of three (3) consecutive years within the total service of the member when the

average was highest, and as the term average annual compensation is further defined in §  36-8-

1(5)(a). For members eligible to retire on or after July 1, 2012, “final compensation” means the

average of the highest five (5) consecutive years of compensation within the total service when the

final compensation was the highest. For members eligible to and who retire on or after July 1, 2024

2009, “final compensation” means the average of the highest three (3) consecutive years of

compensation within the total service when the final compensation was the highest.

     (b) For members who become eligible to retire on or after July 1, 2012, if more than one

half (½) of the member’s total years of service consist of years of service during which the member

devoted less than thirty (30) business hours per week to the service of the municipality, but the

member’s average compensation consists of three (3) or more years during which the member

devoted more than thirty (30) business hours per week to the service of a municipality, such

member’s average compensation shall mean the average of the highest ten (10) consecutive years

of compensation within the total service when the average compensation was the highest; provided

however, effective July 1, 2015, if such member’s average compensation as defined in subsection

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(a) above is equal to or less than thirty-five thousand dollars ($35,000), such amount to be indexed

annually in accordance with § 45-21-52(d)(1)(B), such member’s average compensation shall mean

the greater of: (i) The average of the highest ten (10) consecutive years of compensation within the

total service when the average compensation was the highest; or (ii) The member’s average

compensation as defined in subsection (a) above. To protect a member’s accrued benefit on June

30, 2012, under this subsection (8)(b), in no event shall a member’s average compensation be lower

than his or her average compensation determined as of June 30, 2012.

     Notwithstanding the preceding provisions, in no event shall a member’s final compensation

be lower than the member’s final compensation determined as of June 30, 2012.

     (9) “Fiscal year” means the period beginning on July 1 in any year and ending on June 30

of the next succeeding year.

     (10) “Full actuarial costs” or “full actuarial value” mean the lump sum payable by a

member claiming service credit for certain employment for which payment is required, which is

determined according to the age of the member and their annual rate of compensation at the time

he or she applies for service credit, and which is expressed as a rate percent of the annual rate of

compensation to be multiplied by the number of years for which the member claims the service

credit, as prescribed in a schedule adopted by the retirement board, from time to time, on the basis

of computation by the actuary. Except as provided in §§ 16-16-7.1, 36-5-3, 36-9-31, 36-10-10.4,

and 45-21-53: (i) All service credit purchases requested after June 16, 2009, and prior to July 1,

2012, shall be at full actuarial value; and (ii) All service credit purchases requested after June 30,

2012, shall be at full actuarial value which shall be determined using the system’s assumed

investment rate of return minus one percent (1%).

     (11) “Governing body” means any and all bodies empowered to appropriate monies for,

and administer the operation of, the units as defined in subdivision (13) of this section.

     (12) “Member” means any person included in the membership of the retirement system as

provided in § 45-21-8.

     (13) “Municipality” means any town or city in the state of Rhode Island, any city or town

housing authority, fire, water, sewer district, regional school district, public building authority as

established by chapter 14 of title 37 [repealed], or any other municipal financed agency to which

the retirement board has approved admission in the retirement system.

     (14) “Participating municipality” means any municipality which has accepted this chapter,

as provided in § 45-21-4.

     (15) “Prior service” means service as a member rendered before the effective date of

participation as defined in this section, certified on the member’s prior service certificate, and

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allowable as provided in § 45-21-15.

     (16) “Regular interest” means interest at the assumed investment rate of return,

compounded annually, as may be prescribed from time to time by the retirement board.

     (17) “Retirement allowance” or “annuity” means the amounts paid to any member of the

municipal employees’ retirement system of the state of Rhode Island, or a survivor of the member,

as provided in this chapter. All retirement allowances or annuities shall be paid in equal monthly

installments for life, unless otherwise specifically provided.

     (18) “Retirement board” or “board” means the state retirement board created by chapter 8

of title 36.

     (19) “Retirement system” means the “municipal employees’ retirement system of the state

of Rhode Island” as defined in § 45-21-32.

     (20) “Service” means service as an employee of a municipality of the state of Rhode Island

as defined in subdivision (7).

     (21) “Total service” means prior service as defined in subdivision (15) plus service

rendered as a member on or after the effective date of participation.

     (22) Any term not specifically defined in this chapter and specifically defined in chapters

8 through 10 of title 36 shall have the same definition as set forth in chapters 8 through 10 of title

36.

     SECTION 4. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO EDUCATION -- TEACHERS' RETIREMENT

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     This act would change the teacher and state employees' retirement benefit calculations'

cutoff date, from July 1, 2024, to July 1, 2009, for all retirement members eligible to and who retire

on or after the new July 1, 2009, cutoff date. The average compensation means the average of the

highest three (3) consecutive years, of compensation, within the total service, when the average

compensation was its highest.

     This act would take effect upon passage.

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