CERTIFIED TRANSLATION 

I, Juan E. Segarra, USCCI #06-067/translator, certify that the foregoing is a true and accurate

translation, to the best of my abilities, of the document in Spanish which I have seen.

ARTICLE 5. CONTRIBUTIONS

(1) By members

(a) Each member shall contribute to the System a certain 

uniform percentage from his or her compensation, established by the Board 

of Trustees which, calculated at a regular interest based on the tables 

adopted by the Board of Trustees, is enough, after the member turns 60, to 

pay for a pension equal to three fourths of one percent (.75%) of the average 

annual compensation during the three consecutive years preceding his or 

her retirement, during which the member earned higher salaries, multiplied 

by the number of years of service as a member; IT IS PROVIDED that said 

contributions shall be adjusted to cover any amendments to the contribution

rates established by the Federal Social Security Act in effect from January 

1, 1955. (April 30, 1983).

(b) The Authority shall deduct said percentage from the 

compensation of each member in each and every payroll. When determining 

the amount of the compensation of a member for the period covered by the 

payroll, the Authority may deem the compensation payable to the member 

on the first day of said period as if it continued throughout the entirety of said 

period, and shall be able to refrain from making deductions for the 

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Exhibit 1 Page 1 of 16
CERTIFIED TRANSLATION 

I, Juan E. Segarra, USCCI #06-067/translator, certify that the foregoing is a true and accurate

translation, to the best of my abilities, of the document in Spanish which I have seen.

compensation during any period shorter that the total period, if the member 

was not paid or was not a member, from the first day of the period covered 

by the payroll. To facilitate said deductions, it may modify the deduction 

corresponding to any member by an amount not to exceed 1/10 of 1 percent

of the annual compensation percentage, based on which said deduction 

shall be made. It is understood that all members have agreed and 

consented to the making of the deductions mentioned in these Regulations, 

and shall provide a receipt for his or her total compensation. Payment of 

the compensation, minus said deductions, shall be a complete exemption 

and release from any claims and complaints for services rendered by said 

member during the period covered by said payment, with the exception of 

his or her claim for benefits to which the same may have a right under these 

Regulations. The amounts deducted from the compensation of members 

shall be paid by the Authority to the Board of Trustees in order to deposit 

them in the fund created by these Regulations.

(c) (As amended on October 24, 1968, May 21, 1969). Starting

January 1, 1955, the Authority shall deduct from the contributions paid by 

each member to the System, the contribution established on the 

compensation of the same by the Federal Social Security Act as

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Exhibit 1 Page 2 of 16
CERTIFIED TRANSLATION 

I, Juan E. Segarra, USCCI #06-067/translator, certify that the foregoing is a true and accurate

translation, to the best of my abilities, of the document in Spanish which I have seen.

in effect on the afore mentioned date. The Authority shall retain said 

contribution in order to pay it to the Secretary of the Puerto Rico Treasury; 

IT IS PROVIDED that, starting July 1, 1969, the deduction herein 

established shall not be applied to any member who chooses benefits under 

the System that are completely supplementary to any benefits payable to 

the same under the Federal Social Security Act, in accordance with 

Paragraph (a) of Section (9) of Article 2.

(d) Starting June 1, 1972, each member shall contribute to the 

System, in addition to the percentage of his or her compensation that has 

been determined in accordance with Subsection (a) Article 5 (1), three 

hundredth of one percent (.03%) of his or her compensation; said additional 

contribution shall be increased, starting July 1, 1973, by one and fourteen 

hundredth [of] percent (1.14%) of the compensation of each member. Said 

additional contribution shall be deducted by the Authority from the 

compensation of each member in the same manner provided for payment of 

the contributions of the member under the provisions of Subsection (b) of 

Article 5 (1).

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Exhibit 1 Page 3 of 16
CERTIFIED TRANSLATION 

I, Juan E. Segarra, USCCI #06-067/translator, certify that the foregoing is a true and accurate

translation, to the best of my abilities, of the document in Spanish which I have seen.

(2) Contributions by the Authority.

(a) (As amended on February 1, 1967, entering into effect on 

January 1, 1967). On a monthly basis, or as frequently as agreed to by the 

Board of Trustees, the Authority shall contribute to the Fund created by 

these Regulations, a percentage of the compensation of all members which 

shall be referred to as a regular contribution, and until determined in 

accordance with Section (2), the Authority shall make another contribution 

which shall be referred to as accrued obligations contribution.

(b) Based on the regular interest and on the mortality and 

service tables adopted by the Board of Trustees immediately after doing 

each valuation during the period on which the accrued obligations 

contribution is payable, the Actuary shall determine the uniform percentage 

of the compensation of all members calculated to be required as 

contributions payable by the Authority to provide the benefits of the System 

to which members are normally entitled, in addition to the contributions 

payable by said members. The percentage so determined shall be referred 

to as the regular contribution percentage. After all of the accrued obligations 

contributions have been paid, the

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Exhibit 1 Page 4 of 16
CERTIFIED TRANSLATION 

I, Juan E. Segarra, USCCI #06-067/translator, certify that the foregoing is a true and accurate

translation, to the best of my abilities, of the document in Spanish which I have seen.

regular contribution percentage shall be determined after each actuarial 

valuation as the compensation percentage of all members and shall be 

obtained by deducting from the total of the obligations of the Retirement 

System for all benefits to active and retired members to be contributed by the 

Authority, the amount of the Funds in cash reserved for said benefits, and 

dividing the remaining amount by one percent of the current value of the future 

compensation of all members.

(c) Immediately after the first valuation from the effective date 

of any amendment to the Regulations of the Retirement System, the Actuary 

shall determine the amount of all obligations of the Retirement System for all 

present and future benefits of active and retired members that is not covered 

by the assets reserved for said benefits, the future contributions to be made 

to the System by active members and the future regular contributions to be 

made by said members. The amount so determined shall be referred to as 

the accrued obligations, and the percentage of payable contribution for said 

accrued obligations shall be referred to as the rate of accrued obligations 

contribution.

(d) The total amount to be paid annually by the Authority shall 

not be lower than the sum of the percentages of the compensation of all

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Exhibit 1 Page 5 of 16
CERTIFIED TRANSLATION 

I, Juan E. Segarra, USCCI #06-067/translator, certify that the foregoing is a true and accurate

translation, to the best of my abilities, of the document in Spanish which I have seen.

members known by the percentage of regular contribution and the 

percentage of accrued obligations contribution; IT IS PROVIDED, however, 

that starting January 1, 1967, the rate of accrued obligations contribution

shall be one and a half percent (1%%) of the total annual compensation of 

the members of the System, payable on a monthly basis, and IT IS ALSO 

PROVIDED that the amount of each annual contribution for accrued 

obligations, starting July 1, 1967, shall not be lower than the payment for the 

previous annual accrued obligation; and IT IS ALSO PROVIDED that the 

joint payment by the Authority must be enough, upon combining it with the 

Retirement System assets, to pay for the benefits to be charged to the 

System during the current year.

(e) Accrued obligations contributions shall be suspended as 

soon as the accrued reserves of the Retirement System are equal to the 

cash value actuarially calculated and approved by the Board of Trustees, 

from the total obligations of the Retirement System for the benefit of active 

and retired members, minus the cash value of future regular contributions, 

based on the percent that is in effect, and the future contributions to be 

received on account, of the persons who are members on that date.

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Exhibit 1 Page 6 of 16
CERTIFIED TRANSLATION 

Amended April 25, 2014

I, Juan E. Segarra, USCCI #06-067/translator, certify that the foregoing is a true and accurate

translation, to the best of my abilities, of the document in Spanish which I have seen.

It is provided that if the cost of the total contribution to be made by the 

Authority is zero (0), the regular contribution, in accordance with the 

Regulations, shall not be less than 5% of the payroll of active members.

(Approved on June 29, 2011, Resolution 2011-032.)

(f) (As amended on August 17, 1956). From January 1, 1955, 

the Authority shall pay to the Secretary of the Puerto Rico Treasury from its 

regular contribution to the Retirement System fund, the contribution 

imposed on it from time to time by the Federal Social Security Act.

(g) The Authority shall contribute all of the necessary [Funds] 

for the administrative expenses of the System. The Board of Trustees may 

authorize payment of the administrative expenses of the System charged to 

the general fund as long as it is beneficial to the System administration, in 

which case the Authority shall cover said expenses in the accrued 

obligations contribution. (Approved on August 17, 2000, Resolution 2000-

035)

ARTICLE 6. MANAGEMENT OF THE SYSTEM

(1) The Board of Trustees shall be responsible for the general 

management of the System and putting into effect the provisions of this 

Regulation. The Board of Trustees composed of eight members one of 

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Exhibit 1 Page 7 of 16
CERTIFIED TRANSLATION 

Amended April 25, 2014

I, Juan E. Segarra, USCCI #06-067/translator, certify that the foregoing is a true and accurate

translation, to the best of my abilities, of the document in Spanish which I have seen.

which shall be the Executive Director of the Authority, who, if absent, may 

be replaced by the Interim Executive Director of the Authority. Three 

members shall be active members of the System elected by the active 

members themselves through an individual vote and under the Authority’s 

supervision, three shall be named by the Board of Governors for the 

Authority and one shall be a System Retiree, elected by retired members 

under the supervision of the Retirement System. The Trustees shall be 

appointed or elected for a term of three years. The Executive Director of the 

Authority shall act as a Trustee while exercising the office of Executive 

Director. Each term of an elected or appointed Trustee shall be understood 

to expire on the anniversary date of the establishment of the system, and all 

appointments or elections, except for those to fill vacancies for unexpired 

terms shall take place on said anniversary dates. Vacancies for unexpired 

terms shall be covered in the same manner in which they were originally 

covered.

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Exhibit 1 Page 8 of 16
CERTIFIED TRANSLATION 

10

Amended April 25, 2014

I, Juan E. Segarra, USCCI #06-067/translator, certify that the foregoing is a true and accurate

translation, to the best of my abilities, of the document in Spanish which I have seen.

(2) The Board of Trustees shall hold ordinary meetings (June 19, 

1987) once a month and shall also hold special meetings as necessary. Six 

Trustees shall constitute a quorum and each Trustee shall have one vote, 

but six accordant votes shall be necessary for any Board decision to be 

valid. A President and a Vice-President shall be elected from among its 

members and a Secretary and a Sub-Secretary shall be appointed who 

need not be Trustees. The Board shall obtain whatever administrative, 

legal, office, medical and actuarial services may be necessary to carry out 

the provisions of the System. (December 23, 1993)

(3) The Board of Trustees shall from time to time adopt whatever 

mortality tables and services may be necessary as a basis for actuarial 

calculations and shall establish the percentages of contributions to the 

System, as provided in Article 5 of this Regulation. To advise the Board in 

adoption of the tables and in the determination of the percentages of 

contributions to be made to the Retirement System, the Board of Trustees 

shall appoint an actuary, who will make annual actuarial valuations and 

who shall recommend to the Board the tables and percentages of 

contributions that he or she considers should be used by the Board. In the 

third year after the date the System is implemented and after that 

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Exhibit 1 Page 9 of 16
CERTIFIED TRANSLATION 

11

Amended April 25, 2014

I, Juan E. Segarra, USCCI #06-067/translator, certify that the foregoing is a true and accurate

translation, to the best of my abilities, of the document in Spanish which I have seen.

at least once every five years, the Board of Trustees shall order actuarial 

research based on the experience acquired regarding the mortality, service 

and compensation of the members and the benefits of the Retirement 

System.

(4) The Board of Trustees shall maintain an accounting system 

showing the transactions of the System, as provided below, and shall, in 

an appropriate manner, maintain information that is necessary for actuarial 

valuations of the capital and obligations of the various accounts of the 

System. Every year, the Board shall present to the Governing Board of the 

Authority a report, certified by an auditor hired by the Board of Trustees, 

showing the transactions carried out during the previous year which shall 

include the assets and values accrued and the last balance sheet showing 

the financial situation of the System through an actuarial valuation of the 

assets and liabilities of the same. The Board of Trustees may, from time to 

time and subject to the limitations of this Regulation, establish rules for the 

management and functioning of the Retirement System. The Board of 

Trustees of the Retirement System shall be the body that determines the 

amount to be paid for any member requesting that services 

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Exhibit 1 Page 10 of 16
CERTIFIED TRANSLATION 

12

Amended April 25, 2014

I, Juan E. Segarra, USCCI #06-067/translator, certify that the foregoing is a true and accurate

translation, to the best of my abilities, of the document in Spanish which I have seen.

rendered be accredited beforehand. The decision of the Board of Trustees, 

regarding any matter or controversy, shall be final within the administrative 

process. With regard to service accreditation cases, the Board shall sign 

the determination of the amount to be paid by the member of the System 

and shall notify the applicant by certified mail return receipt requested, and 

shall file a copy of the determination and proof of notice. If, after conclusion 

of the informal process carried out by the officials of the Retirement System 

to handle any claim by a member or beneficiary entailing an interpretation 

of the provisions of the Regulation of the Retirement System, other than a 

service accreditation, the member or beneficiary does not agree with said 

determination, he or she may, within the term of twenty (20) calendar days 

from the notification, file a written Petition to the Board of Trustees to resolve 

the issue. This letter shall include all of his or her allegations and shall attach 

any evidence that serves to support his or her arguments.

In service accreditation cases, the determination shall give 

notice of the right to request reconsideration through a motion or request 

addressed to the Board of Trustees within a final term of twenty (20) days 

from the date in the entry on the case file. The Board shall consider the

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Exhibit 1 Page 11 of 16
CERTIFIED TRANSLATION 

13

Amended April 25, 2014

I, Juan E. Segarra, USCCI #06-067/translator, certify that the foregoing is a true and accurate

translation, to the best of my abilities, of the document in Spanish which I have seen.

request for reconsideration, in both cases, within fifteen (15) days of its being 

filed. If it is summarily rejected or if no action is taken within the term of 

fifteen (15) days, the term to request judicial review shall commence anew 

as of the time that notice is given of said denial or from the time the fifteen 

(15) days expire, as the case may be. If the Board takes a determination into 

consideration, the term to request judicial review shall commence as of the 

date on which a copy of the notice of the Board’s determination definitively 

resolving the request for reconsideration is entered on the case file. Said 

determination shall be issued and entered on the case file within ninety (90) 

days from the filing of the motion or request for reconsideration. If the Board 

of Trustees accepts the motion for reconsideration but fails to take any 

action with respect to the motion within ninety (90) days of its being filed, it 

shall lose jurisdiction over the motion and the term to request judicial review 

shall commence as of the expiration of said ninety (90) day term, unless the 

Board, for just cause, and within those ninety (90) days, extends the term to 

resolve the matter within a term not to exceed thirty (30) additional days.

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Exhibit 1 Page 12 of 16
CERTIFIED TRANSLATION 

I, Juan E. Segarra, USCCI #06-067/translator, certify that the foregoing is a true and accurate

translation, to the best of my abilities, of the document in Spanish which I have seen.

If the Board concludes or decides that it will not initiate or 

continue an adjudicative proceeding in a particular case, it shall terminate 

the proceeding and notify the moving party, in writing by certified mail return 

receipt requested, of its decision, the grounds for that decision and the 

availability of a request for review.

A party adversely affected by a determination by the Board of 

Trustees, after exhausting the administrative reconsideration procedure 

before the Board, may file a request for judicial review with the competent 

Circuit Court of Appeals within a term of thirty (30) days from the date that 

the copy of the notice of the Board’s final determination is entered on the 

case file. The party shall give notice of the filing of the request for review 

to the Board of Trustees within the term to request such review. Notice may 

be made by mail. (Approved on July 20, 2007, Order 2007-049)

(8) Fiduciary Insurance Policy and Crime Insurance Policy; The 

Board of Trustees shall make arrangements to acquire insurance policies 

for the Trustees and Retirement System officials covering fiduciary and 

criminal liability.

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Exhibit 1 Page 13 of 16
CERTIFIED TRANSLATION 

I, Juan E. Segarra, USCCI #06-067/translator, certify that the foregoing is a true and accurate

translation, to the best of my abilities, of the document in Spanish which I have seen.

(9) Updating of signatures; The Board of Trustees shall designate 

employees authorized to carry out transactions with the assets of the 

System. The Administrator shall ensure that the signatures of 

authorized employees are updated whenever changes arise. 

(Approved on August 31, 2001, Order 2001-038.) ARTICLE

ARTICLE 9. GENERAL PROVISIONS

(1) The establishment of this Retirement System shall not be 

considered nor interpreted as an employment contract nor cause for the 

same, nor shall it affect the Authority’s right to dismiss any employee from 

service. 

(2) The intention of the Authority is to maintain the System so long 

as it continues to carry out the role and purposes for which it was created, 

but the Authority, by means of a recommendation by its Board of Trustees 

and action by the Board of Governors may, for reasons affecting its normal 

development and functioning as a solvent entity, discontinue, suspend or 

reduce its contributions to a level lower than that required in Article 5, in 

which case member contributions may also be discontinued, suspended or 

reduced in the same proportion and for the same period and all benefits 

shall be reduced to amounts such that the contributions made up to that 

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Exhibit 1 Page 14 of 16
CERTIFIED TRANSLATION 

I, Juan E. Segarra, USCCI #06-067/translator, certify that the foregoing is a true and accurate

translation, to the best of my abilities, of the document in Spanish which I have seen.

date, plus the lower future contributions (if any) could provide, in 

accordance with actuarial evaluations. 

(3) The Authority, by means of a recommendation of the Board of 

Trustees and the action of its Board of Governors, based on causes or 

circumstances beyond its control, may terminate the functioning of the 

System at any time. In the event of such termination, all the System’s capital 

shall be used only for the benefit of active members, retired members and 

their beneficiaries under the System, and for no other purpose. Each 

member or person with a right to a pension shall have a right to his or her 

corresponding proportionate share of the total amount of System capital 

according to all the prior contributions made by to the [sic] and by the 

Authority with respect to the benefits to be paid to to the [sic] or on his or her 

account and in the proportion that the System’s obligations in his or her 

account has to the total obligations of the System as determined by the 

Board of Trustees based on actuarial evaluations. The Board of Trustees 

may require said members, or other persons, to withdraw such amounts, in 

the form of immediate or deferred annuities, as the Board may determine 

within its discretion. 

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Exhibit 1 Page 15 of 16
CERTIFIED TRANSLATION 

I, Juan E. Segarra, USCCI #06-067/translator, certify that the foregoing is a true and accurate

translation, to the best of my abilities, of the document in Spanish which I have seen.

(4) Notwithstanding any provision to the contrary established in this 

Regulation, the Board of Governors of the Authority shall have the power 

to, where special circumstances are present, grant a special pension or 

benefit to any employee, whether or not he or she is a member of this 

System, and said pension or benefit shall be paid from the Retirement 

System, PROVIDED THAT, the Authority first pays to the System the 

amount required to cover the amount of said pension or benefit

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