2023 Vermont Statutes › Title 3 - Executive › Chapter 16 - Vermont Employees' Retirement System › § 470. Postretirement adjustments to retirement allowances

§ 470. Postretirement adjustments to retirement allowances
(a) Postretirement adjustments to retirement allowance. Beginning January 1, 2023 and each year thereafter, the retirement allowance of each beneficiary of the System who is in receipt of a retirement allowance and who meets the eligibility criteria set forth in this section shall be adjusted by the amount described in subsection (d) of this section. In no event shall a beneficiary receive a negative adjustment to the beneficiary’s retirement allowance.
(b) Calculation of net percentage increase.
(1) Consumer Price Index; maximum and minimum amounts. Prior to October 1 of each year, a determination shall be made of any increase or decrease, to the nearest one-tenth of a percent, in the Consumer Price Index for the month ending on June 30 of that year to the average of said index for the month ending on June 30 of the previous year. Any increase or decrease in the Consumer Price Index shall be subject to adjustment so as to remain within the following maximum and minimum amounts:
(A) For Group A members, the maximum amount of any increase or decrease used to determine the net percentage increase shall be five percent.
(B) For Group C members who are first eligible for normal retirement or unreduced early retirement on or before June 30, 2022, or who are vested deferred members as of June 30, 2022, the maximum amount of any increase or decrease used to determine the net percentage increase shall be five percent.
(C) For Group C members who are first eligible for normal retirement or unreduced early retirement on or after July 1, 2022, the maximum amount of any increase or decrease used to determine the net percentage increase shall be four percent.
(D) For Group D members, the maximum amount of any increase or decrease used to determine the net percentage increase shall be five percent.
(E) For Group F and Group G members who are first eligible for normal retirement or unreduced early retirement on or before June 30, 2022, or who are vested deferred members as of June 30, 2022, the maximum amount of any increase or decrease used to determine the net percentage increase shall be five percent. In the event that there is an increase or decrease of less than one percent, the net percentage increase shall be assigned a value of one percent and shall not be subject to further adjustment pursuant to subsection (d) of this section.
(F) For Group F and Group G members who are first eligible for normal retirement or unreduced early retirement on or after July 1, 2022, the maximum amount of any increase or decrease used to determine the net percentage increase shall be four percent.
(2) Consumer Price Index; decreases. In the event of a decrease in the Consumer Price Index, there shall be no adjustment to retirement allowances for the subsequent year beginning January 1; provided, however, that:
(A) such decrease shall be applied as an offset against the first subsequent year’s increase of the Consumer Price Index, up to the full amount of such increase; and
(B) to the extent that such decrease is greater than such subsequent year’s increase, such decrease shall be offset in the same manner against two or more years of such increases, for up to but not exceeding five subsequent years of such increases, until fully offset.
(3) Consumer Price Index; increases. In the event of an increase in the Consumer Price Index, and provided there remains an increase following the application of any offset as in subdivision (2) of this subsection, that amount shall be identified as the net percentage increase and used to determine the members’ postretirement adjustment as described herein.
(c) Eligibility for postretirement adjustment. In order for a beneficiary to receive a postretirement adjustment to the beneficiary’s retirement allowance, the beneficiary must meet the following eligibility requirements:
(1) Retired and vested deferred on or before June 30, 2022. For all members who are retired or vested deferred on or before June 30, 2022, other than those Group F members on an early retirement allowance who have not reached normal retirement age, as specified in subdivision (4) of this subsection, the member must be in receipt of a retirement allowance for at least 12 months prior to the January 1 effective date of any postretirement adjustment.
(2) In service on or before June 30, 2022. For all Group A, C, F, and G members who are first eligible for normal retirement or unreduced early retirement on or before June 30, 2022, and for Group D members first appointed or elected on or before June 30, 2022, the member must be in receipt of a retirement allowance for at least 12 months prior to the January 1 effective date of any postretirement adjustment.
(3) In service on or after July 1, 2022. For all Group A, C, F, and G members who are first eligible for normal retirement or unreduced early retirement on or after July 1, 2022, and for Group D members first appointed or elected on or after July 1, 2022, the member must be in receipt of a retirement allowance for at least 24 months prior to the January 1 effective date of any postretirement adjustment.
(4) Special rule for Group F and Group G early retirement. A Group F or Group G member in receipt of an early retirement allowance shall not receive a postretirement adjustment to the member’s retirement allowance until such time as the member has reached normal retirement age, provided the member has also met the other eligibility criteria set forth in this subsection.
(d) Amount of postretirement adjustment. The postretirement adjustment for each member who meets the eligibility criteria set forth in subsection (c) of this section shall be as follows:
(1) the full amount of the net percentage increase calculated in subsection (b) of this section for the following:
(A) Group A and C members, provided that the net increase following the application of any offset as provided in this section equals or exceeds one percent;
(B) Group D members first appointed or elected on or before June 30, 2022, provided that the net increase following the application of any offset as provided in this section equals or exceeds one percent; and
(C) commencing January 1, 2014, any active contributing member of the Group F or Group G plan on or after June 30, 2008, and who retires as a Group F or Group G member on or after July 1, 2008;
(2) one-half of the net percentage increase calculated in subsection (b) of this section for Group F members who retired on or before June 30, 2008;
(3) for Group D members first appointed or elected on or after July 1, 2022, provided that the net increase following the application of any offset as provided in this section equals or exceeds one percent, the full amount of the net percentage increase calculated in subsection (b) of this section for amounts equal to or less than $75,000.00 of annual retirement allowance and one-half the net percentage increase calculated in subsection (b) of this section for amounts $75,000.01 or greater of annual retirement allowance.
(e) Definition. For purposes of this section:
(1) “Consumer Price Index” means the Northeast Region Consumer Price Index for all urban consumers, designated as “CPI-U,” in the northeast region, as published by the U.S. Department of Labor, Bureau of Labor Statistics.
(2) “Vested deferred” means a member who receives a vested deferred allowance payable pursuant to subsection 465(a) of this title.
(f) Deferred vested allowance. No increase shall be made pursuant to this section in a deferred vested allowance payable pursuant to subsection 465(a) of this title prior to its commencement. (Added 1971, No. 231 (Adj. Sess.), § 4; amended 1981, No. 41, § 15; 1989, No. 277 (Adj. Sess.), § 17q; 1991, No. 64, § 3, eff. June 18, 1991; 1997, No. 89 (Adj. Sess.), § 9; 1999, No. 158 (Adj. Sess.), § 12; 2007, No. 116 (Adj. Sess.), § 3; 2009, No. 24, § 3; 2009, No. 139 (Adj. Sess.), §§ 2a, 13(b); 2011, No. 63, § H.1; 2013, No. 22, § 4; 2015, No. 114 (Adj. Sess.), § 3; 2021, No. 114 (Adj. Sess.), § 10, eff. July 1, 2022; 2023, No. 3, § 97, eff. March 20, 2023.)