Bill > H5762

This bill modifies the retirement allowance calculations for teachers, state employees, and municipal employees in Rhode Island, introducing a new tiered percentage system for calculating retirement benefits effective July 1, 2025. The bill changes how retirement allowances are calculated based on years of service, creating a more graduated structure where the percentage of compensation increases with longer service periods. Specifically, for 1-20 years of service, employees will receive 1% per year; for 21-30 years, 1.5% per year; for 31-35 years, 2% per year; and for 36-40 years, 3% per year. This represents a shift from previous calculation methods that had different schedules for employees who joined before or after certain dates. The bill applies to three different sections of Rhode Island law covering teachers, state employees, and municipal employees, ensuring a consistent approach across these public sector employee groups. The changes aim to provide a more progressive retirement benefit structure that rewards longer-term public service with incrementally higher percentage payouts. The bill will take effect immediately upon passage, with the new calculation method becoming operative on July 1, 2025.

Budget and Finance

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