2020 -- S 2064

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LC003438

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2020

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A N   A C T

RELATING TO EDUCATION -- TEACHERS' RETIREMENT

     Introduced By: Senators DiPalma, Sosnowski, Gallo, Conley, and Pearson

     Date Introduced: January 21, 2020

     Referred To: Senate Finance

     It is enacted by the General Assembly as follows:

     SECTION 1. Section 16-16-22 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:

     16-16-22. Contributions to state system. [Effective July 1, 2020.]

     (a) Prior to July 1, 2012, each teacher shall contribute into the system nine and one-half

percent (9.5%) of compensation as his or her share of the cost of annuities, benefits, and

allowances. Effective July 1, 2012, each teacher shall contribute an amount equal to three and

three quarters percent (3.75%) of his or her compensation. Effective July 1, 2015, each teacher

with twenty (20) or more years of total service as of June 30, 2012, shall contribute an amount

equal to eleven percent (11%) of his or her compensation. The employer contribution on behalf of

teacher members of the system shall be in an amount that will pay a rate percent of the

compensation paid to the members, according to the method of financing prescribed in the state

retirement act in chapters 8 -- 10 and 10.3 of title 36. This amount shall be paid forty percent

(40%) by the state and sixty percent (60%) by the city, town, local educational agency, or any

formalized commissioner-approved cooperative service arrangement by whom the teacher

members are employed,; effective July 1, 2021, the amount paid by the state shall be forty-two

percent (42%) and fifty-eight percent (58%) by the city, town or local educational agency;

effective July 1, 2022, the amount paid by the state shall be forty-four percent (44%) and fifty-six

percent (56%) by the city, town or local educational agency; effective July 1, 2023, the amount

paid by the state shall be forty-six percent (46%) and fifty-four percent (54%) by the city, town or

local educational agency; effective July 1, 2024, the amount paid by the state shall be forty-eight

percent (48%) and fifty-two percent (52%) by the city, town or local educational agency;

effective July 1, 2025, the amount paid by the state shall be fifty percent (50%) and fifty percent

(50%) by the city, town or local educational agency; with the exception of teachers who work in

federally funded projects and further with the exception of any supplemental contributions by a

local municipality employer under chapter 10.3 of title 36 which supplemental employer

contributions shall be made wholly by the local municipality. Provided, however, that the rate

percent paid shall be rounded to the nearest hundredth of one percent (.01%).

     (b) The employer contribution on behalf of teacher members of the system who work in

fully or partially federally funded programs shall be prorated in accordance with the share of the

contribution paid from the funds of the federal, city, town, or local educational agency, or any

formalized commissioner-approved cooperative service arrangement by whom the teacher

members are approved.

     (c) In case of the failure of any city, town, or local educational agency, or any formalized

commissioner-approved cooperative service arrangement, to pay to the state retirement system

the amounts due from it under this section within the time prescribed, the general treasurer is

authorized to deduct the amount from any money due the city, town, or local educational agency

from the state.

     (d) The employer's contribution shared by the state shall be paid in the amounts

prescribed in this section for the city, town, or local educational agency and under the same

payment schedule. Notwithstanding any other provisions of this chapter, the city, town, or local

educational agency or any formalized commissioner-approved cooperative service arrangement

shall remit to the general treasurer of the state the local employer's share of the teacher's

retirement on the date contributions are withheld but no later than three (3) business days

following the pay period ending in which contributions were withheld. The amounts that would

have been contributed shall be deposited by the state in a special fund and not used for any

purpose. The general treasurer, upon receipt of the local employer's share, shall effect transfer of

a matching amount of money from the state funds appropriated for this purpose by the general

assembly into the retirement fund.

     Upon reconciliation of the final amount owed to the retirement fund for the employer

share, the state shall ensure that any local education aid reduction assumed for the FY 2010

revised budget in excess of the actual savings is restored to the respective local entities.

     (e) This section is not subject to §§ 45-13-7 through 45-13-10.

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     SECTION 2. 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 gradually increase the state's contribution to the teachers' retirement

system, while reducing the municipal contribution, eventually resulting in the contributions being

shared equally.

     This act would take effect upon passage.

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LC003438

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