(a)  An adequate system of accounts and records is established and maintained for the system that fully reflects the requirements of this chapter. All assets of the system are credited according to the purposes for which they are held in the following designated reserve accounts:

(1) Members’ contribution reserve.

(i)  The amounts contributed by the members are credited to this reserve. An individual account is maintained for each member. Member contributions made pursuant to § 45-21-41.1 are credited to a separate fund within a member’s individual account so that the amounts contributed prior to the effective date for the pickup of member contributions may be distinguished from the amount contributed on or after the date on which the municipality begins to pick up member contributions.

(ii)  Upon the granting of a retirement allowance, the total accumulated contributions of the member concerned are transferred from this reserve to the retirement reserve. Refunds and death benefit payments representing members’ contributions are charged to this reserve.

(2) Employer’s accumulation reserve.

(i)  The amounts contributed by the municipalities for the various purposes of this section are credited to this reserve. Upon the granting of a retirement allowance, annuity, or benefit, an amount representing the excess of the actuarial value over the total contributions of the member is transferred from this reserve to the retirement reserve. That portion of the death benefit provided from municipality contributions is charged to this reserve.

(ii)  Upon request by a municipality, to transfer monies from this reserve to any one or more of the municipality’s other retirement units within the municipal employee retirement system which has unfunded liability, the retirement board shall request a private letter ruling from the Internal Revenue Service and upon receipt of a favorable ruling, shall transfer the funds consistent with the private letter ruling.

(3) Retirement reserve.  Upon the granting of a retirement allowance, the accumulated contributions of the member and an amount representing the excess of the actuarial value of the allowance over the accumulated contributions, are transferred to this reserve from the members’ contribution reserve and the employer’s accumulation reserve, respectively.

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Terms Used In Rhode Island General Laws 45-21-43

  • Accumulated contributions: means the sum of all amounts deducted from the compensation of a member and credited to his or her individual account in the members' contribution reserve account. See Rhode Island General Laws 45-21-2
  • Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
  • board: means the state retirement board created by chapter 8 of Title 36. See Rhode Island General Laws 45-21-2
  • 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. See Rhode Island General Laws 45-21-2
  • Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
  • Member: means any person included in the membership of the retirement system as provided in §?45-21-8. See Rhode Island General Laws 45-21-2
  • 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, or any other municipal financed agency to which the retirement board has approved admission in the retirement system. See Rhode Island General Laws 45-21-2
  • Retirement system: means the "municipal employees' retirement system of the state of Rhode Island" as defined in §?45-21-32. See Rhode Island General Laws 45-21-2
  • Service: means service as an employee of a municipality of the state of Rhode Island as defined in subdivision (7). See Rhode Island General Laws 45-21-2

(b)  All payments on account of any retirement allowance or any benefit to a beneficiary of a member are charged to this reserve.

(c)  Any excess amount in this reserve, over the actuarial liabilities of the reserve, as determined by actuarial valuation, is transferred at the close of each year to the employer’s accumulation reserve to be used to reduce the municipality’s contribution upon a rate redetermination as established by the periodic actuarial valuation provided in this section. Any deficiency in this reserve is removed by a transfer from the employer’s accumulation reserve.

(d)  All income from investments, including gains from investment transactions, is credited to this reserve. All losses on investments are charged to this reserve.

History of Section.
P.L. 1951, ch. 2784, § 14; G.L. 1956, § 45-21-43; R.P.L. 1957, ch. 135, § 5; P.L. 1959, ch. 23, § 7; P.L. 1983, ch. 137, § 5; P.L. 2000, ch. 454, § 1.