H 7566Cities & Towns

Towns and Cities - Retirement of Municipal Employees

This bill allows disabled retired police and firefighters to earn up to five times their former salary while keeping their pension.

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Introduced Feb 6, 2026Committee House Municipal Government & Housing

Plain-English Summary

This legislation amends the rules regarding disability allowances for retired municipal employees, specifically targeting police officers and firefighters who retired under the optional retirement provisions (Chapter 21.2). Currently, if a disability beneficiary returns to work, their combined earnings and disability allowance cannot exceed the current salary of their former position. This bill significantly raises that cap for police and firefighters, allowing their combined income (allowance plus new earnings) to reach up to five times the current salary of the position they held before retiring.

For younger readers

Sometimes, police officers and firefighters get hurt at work and have to retire early. When this happens, they get money called a "pension" to help them live. Before this bill, if they got a new job, there was a limit on how much extra money they could make before their pension was lowered. This new rule says that these police officers and firefighters can now get a new job and earn a lot more money—up to five times what they used to make—without losing their pension payments.

Who & Where It Applies

Impacted groups

Police OfficersFirefightersMunicipal Retirement BoardTaxpayersDisability Annuitants

Impacted communities

All

Constitutional & Fiscal Check

None Likely

Estimated cost

Amount unknown

Estimated revenue

None

Bill Analysis

Both viewpoints

For Progressives

Provides greater financial security and economic stability for injured first responders and their families who have been forced out of their chosen profession due to disability.
Encourages disabled individuals to re-enter the workforce in new capacities without the fear of immediately losing their retirement benefits, promoting active community participation.
Recognizes the rising cost of living by adjusting income caps, ensuring that those relying on disability benefits are not trapped in financial hardship due to inflation.
Creates a massive disparity between police/firefighters and other municipal employees or the general public, reinforcing a system of special privileges for specific groups.
Allows for an exceptionally high income limit (five times the previous salary) while collecting public benefits, which may be viewed as an excessive use of taxpayer-funded safety nets.
Could place an undue financial strain on the municipal retirement system, potentially diverting resources from other essential public services or social programs.

For Conservatives

Removes government-imposed income caps that disincentivize work, encouraging individuals to seek private sector employment and achieve financial independence.
Supports law enforcement and firefighters who have sacrificed their health for public safety, upholding traditional values of honoring those who serve the community.
Reduces the "welfare cliff" effect where earning a marginal dollar results in a loss of benefits, thereby promoting free market participation.
Expands government spending liabilities by allowing generous payouts to continue even when individuals are earning substantial incomes, potentially burdening taxpayers.
Creates a potential moral hazard where the definition of "disability" creates a lucrative pathway to double-dipping, undermining the integrity of the retirement system.
Sets a precedent for special treatment of government employees over private sector workers, who rarely have access to such generous disability-plus-income arrangements.

Votes

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Full Bill Text

Changes to existing Rhode Island law · 6 additions

SECTION 1. Section 45-21-24 of the General Laws in Chapter 45-21 entitled "Retirement of Municipal Employees" is hereby amended to read as follows: 45-21-24. Adjustment of disability allowances on return to work — Discontinuance for refusal to submit to examination.

(a) Should the beneficiary be engaged in a gainful occupation or should the beneficiary be offered service as a result of the placing of his or her name on a list of candidates, the retirement board shall adjust, and from time to time readjust, the amount of his or her disability allowance to an amount which, when added to the amount of compensation then earnable by the beneficiary, shall not exceed the rate of earnable compensation currently in force for the classification that the disability annuitant held prior to retirement. Beneficiaries that retire under the provisions of chapter 21.2 of title 45, shall be entitled to earn an amount that, when added to the amount of compensation then earnable by the beneficiary, shall not exceed five (5) times the rate of earnable compensation currently in force for the classification that the disability annuitant held prior to retirement.

(b) Should any disability annuitant under the minimum age of retirement refuse to submit to a medical examination in any year by a physician or physicians designated by the retirement board, the annuitant’s retirement allowance may be discontinued until the annuitant’s withdrawal of the refusal, and should the annuitant’s refusal continue for one year after a request has been made, all the annuitant’s rights in and to the retirement allowance may be revoked by the retirement board. A disability annuitant, reinstated to active service, shall be reinstated as a member and participate in the benefits of the retirement system to the same extent as any other member.

SECTION 2. This act shall take effect upon passage.