Chapter 357
2012 -- S 2036 AS AMENDED
Enacted 06/20/12
A N A C T
RELATING TO
TOWNS AND CITIES -- OTHER POST- EMPLOYMENT BENEFITS
TRUSTS
Introduced By: Senators DiPalma, Sheehan, Bates, Ottiano, and Sosnowski
Date Introduced: January 11, 2012
It is enacted by the
General Assembly as follows:
SECTION 1. Section 45-21-65 of the General Laws in Chapter
45-21 entitled
"Retirement of
Municipal Employees" is hereby amended to read as follows:
45-21-65. Other post-employment benefits -- OPEB trusts. --
(a) Notwithstanding the
provisions of any general or special law, or the provisions of
any municipality's home rule
charter, to the contrary, for purposes of funding any
unfunded liability for other post-employment
benefits including, but not limited to, health care and dental
care benefits hereinafter referred to
as ("OPEB") in accordance with government
accounting standards board statements 43 and 45, a
municipality, acting by its treasurer or director of finance, upon
an approving resolution of the
city or town council or agency board as applicable, may
enter into a trust agreement between the
municipality and a corporate trustee which shall be a bank or
trust company doing business in the
state, or a corporation established pursuant to chapter 5
of title 45 of the general laws. This
trust
agreement shall be in any form deemed proper by the treasurer
or director of finance of the
municipality, and shall be executed by its treasurer or director
of finance and countersigned by its
mayor or president of the town council. It shall be lawful
for any bank or, trust company, or entity
organized pursuant to section 45-5-20.1 doing business in the state to act as a depository or
trustee under this trust agreement, and to furnish indemnification
and pledge securities that may
be required by any municipality.
(b) OPEB trust funds
shall be credited with all amounts appropriated or otherwise made
available by the municipality for the purposes of meeting the
current and future OPEB costs
payable by the municipality. OPEB trust funds shall also be
credited with all amounts contributed
or otherwise made available by employees of the
municipality for the purpose of meeting future
OPEB costs payable by the municipality. Amounts in an
OPEB trust fund, including any earnings
or interest accruing from the investment of these
amounts, shall be expended only for the
payment of the costs payable by the municipality for OPEB or
as otherwise permitted by the
terms of the trust and applicable law. The director of
finance or treasurer, as applicable, shall
invest and reinvest the amounts in the OPEB trust fund not
needed for current disbursement in
any investment permitted for the municipality's pension
funds consistent with the prudent person
rule and investment policies of the municipality, if any.
(c) Municipalities are
hereby authorized to enter into agreements, trusts, contracts, and
other arrangements with the state and any of its
departments, agencies, boards or commissions
relating to the execution, management or operation of the OPEB
trust funds, including, but not
limited to, investments, and the state and its departments,
agencies, boards and commissions are
hereby authorized to enter into such agreements, contracts
and other arrangements with
municipalities. Notwithstanding any provisions of any general or
special law or principle of
equity to the contrary, the state shall have no liability to
any municipality for entering into such
agreements. A municipality may employ any qualified bank,
trust company, corporation, firm or
person to advise it on the investment of the OPEB trust fund
and may pay from the OPEB trust
fund for this advice and other services. Procurement for
these services shall be subject to the
procurement procedures and rules governing municipalities in the
state.
(d) A municipality
may employ any qualified bank, trust company, corporation, firm or
person to advise it on the investment of the OPEB trust fund
and may pay from the OPEB trust
fund for this advice and other services. Procurement for
these services shall be subject to the
procurement procedures and rules governing municipalities in the
state.
(e) Municipalities are
also hereby authorized to enter into agreements, trusts, contracts,
and other arrangements with any corporation established
pursuant to chapter 5 of title 45 of the
general laws relating to the execution management or
operations of OPEB trust funds including,
but not limited to, investments, and the corporations
established pursuant to section 45-5-20.1 of
the general laws are hereby authorized to enter into such
agreements, trusts, contracts or other
arrangements with municipalities.
(d)(f) Any
OPEB trusts that have been created by municipalities and are in effect on the
date hereof are hereby ratified and confirmed.
(e)(g)
Nothing herein shall be construed to exempt OPEB trusts from the
Access to Public Records Act, RIGL
38-2-1 et seq.
SECTION 2. Chapter 45-5 of the General Laws entitled
"Councils and Governing
Bodies" is hereby
amended by adding thereto the following section:
45-5-20.2. Power
of city and town councils and regional school districts to
jointly
establish a corporation to manage and operate OPEB trusts. -- (a) Notwithstanding the
provisions of any general or special law to the contrary,
corporations established pursuant to
section 45-5-20.1 also shall have the power to manage and
operate such other post-employment
benefit OPEB trusts as are established pursuant to section
45-21-65 and section 16-2-9.5. Such
corporations shall have the powers set forth in section 45-5-20.1,
and shall have additional
powers as are necessary to effectuate the purposes of this
section.
(b) For the purpose
of OPEB trusts managed and operated pursuant to this section, the
corporation shall maintain discrete sub-trust accounts for each
of the participating entities setting
forth the contributions made by each participating entity,
the allocated income assigned to each
participating entity as it may be derived from investments and
other revenue sources, the funds
distributed to each participating entity for use in meeting its
OPEB obligations, each entity's
allocated share of the administrative costs, including
investment management fees, for operating
the OPEB trust, and such other items as the directors of
the corporation hereby established shall
deem proper and necessary. Agreements made pursuant to this
section may provide for pooling of
administrative expenses, including investment management and
advisory services, associated
with the operation of the OPEB trust and sub-trusts.
(c) The corporation
shall ensure that a separate audit of OPEB trusts and sub-trusts is
performed annually, copies of which shall be provided to the
participating entities of the OPEB
trust and the auditor general.
SECTION 3. This act shall take effect upon passage.
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LC00051
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