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HB 8506

AN ACT RELATING TO TOWNS AND CITIES -- RELATING TO CENTRAL FALLS PENSION PLAN

2026 Regular Session Introduced by Karen Alzate and 2 co-sponsors

Central Falls may align its police and fire pension with the state system, phased from 2026, while keeping local liability and reducing employee contributions to 10%.

06/26/2026 Effective without Governor's signature
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Bill Summary · HB 8506

Summary of Bill HB 8506 (Rhode Island, 2026)

Title

AN ACT RELATING TO TOWNS AND CITIES -- RELATING TO CENTRAL FALLS PENSION PLAN

Purpose and Intent

  • The bill amends the Central Falls pension plan for police and firefighters, focusing on modifying eligibility, structure, and contribution levels in relation to the local pension plan for Central Falls.
  • It sets conditions under which Central Falls may participate in the state-administered retirement framework for certain municipal employees and outlines how the plan would be administered if those conditions are met.

Key Provisions and Changes

  1. Optional Acceptance of Pension Provisions (Central Falls)

    • Central Falls may adopt the provisions of the state retirement chapter (45-21.4) for its police and fire units by a resolution/ordinance, provided labor organizations assent via collective bargaining and ratification by members.
    • A copy of the resolution and assent must be sent to the retirement board, which must also vote to accept the entry of these groups into the system.

  2. Closure to New Members

    • Effective August 31, 2019, the Central Falls municipal pension plan is closed to new members.

  3. Transitional Provisions for Active Members

    • Before July 1, 2026:
      • Active members as of August 31, 2019 continue under the pension ages, restrictions, and benefit accruals tied to the Central Falls plan, as defined by applicable collective bargaining agreements in effect on August 31, 2019.
    • On and after July 1, 2026:
      • Active members as of August 31, 2019 will be subject to pension provisions in the collective bargaining agreements in effect on July 1, 2026.

  4. Disability Benefits

    • Disability determinations for members hired prior to September 1, 2019 follow existing retirement board procedures.
    • If disability retirement is granted, benefits are those provided by the Central Falls pension plan under the 2019 agreements.

  5. Member Contributions

    • From September 1, 2019 through June 30, 2026, active firefighters and police in the Central Falls plan contribute 11.7% of salary.
    • From July 1, 2026 onward (for new or continuing conditions as defined), contributions are 10% of salary.

  6. New Employees Post-2019

    • New hires on or after September 1, 2019 become subject to all provisions of the general retirement system (including disability provisions and benefits) under sections 45-21.2 and related statutes, assuming the bylaws for participation are met.

  7. Funding and Cost Allocation

    • The retirement board bears the cost of evaluating prospective Central Falls membership in the retirement system.
    • The method for calculating the employer contribution rate for the closed Central Falls plan uses an unfunded actuarial accrued liability (UAAL) amortization period as determined by the plan’s actuary, with future gains/losses amortized over twenty-year periods.

  8. Portability and Transfer of Accrued Liabilities

    • If a member leaves Central Falls for employment with another participating municipality not in critical status, the member’s accrued liability may be transferred to the new employer, proportional to the Central Falls plan’s funded status.

  9. Administration and Liability

    • Central Falls remains liable for the cost of funding its employees who are members of the system, with enforcement rights retained by the retirement board under Chapter 21.
    • The Central Falls plan and this section are administered in the same manner as Chapter 21, with conflicts resolved in favor of this section when applicable.

Affected Parties

  • City of Central Falls and its municipal government
  • Police and firefighter members of the Central Falls pension plan (active and, later, post-transition cohorts)
  • Labor organizations representing Central Falls police and fire employees
  • Rhode Island Retirement System (retirement board)
  • Other participating municipalities if members transfer out of Central Falls

Effective Date

  • This act takes effect upon passage.

Significance and Potential Impacts

  • Establishes a framework for Central Falls to integrate or align with broader pension provisions for police and fire personnel, with explicit labor assent requirements.
  • Introduces a controlled path for phasing active Central Falls members into the state framework starting July 1, 2026.
  • Reduces the employee contribution rate for active Central Falls police and firefighters from 11.7% to 10% of salary (as of the transition provisions).
  • Maintains Central Falls’ financial responsibility for funding its retained liabilities and permits strategic transfers to other municipalities under specified conditions.
  • Implications for plan funding, actuarial assumptions, and potential cost shifts depend on future actuarial evaluations and labor agreements.

Compiled from official sources — confirm details with the bill’s official record.

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