Redetermination of Allowances During Deflation and Consumer Pricing Indices To Be Considered

PURPOSE: The purpose of this rule is to clarify how retiree allowances will be redetermined pursuant to section 70.655.7–.10 et. seq., RSMo, during periods of deflation and which Consumer Pricing Indices may be considered in making the redetermination. (1) For purposes of calculating the redetermined amount of the allowance as set forth under section 70.655.7–.10 et. seq., RSMo, during periods of deflation, if the annual Consumer Price Index (CPI) is negative, there shall be no actual reduction in the redetermined amount of the retirees’ allowances. However, in the next year in which the annual Consumer Price Index (CPI) is positive, the Board of Trustees may consider the cumulative net increase or decrease in the Consumer Price Index (CPI) inclusive of the negative and positive years when redetermining any amount of the retirees’ allowances. (2) In order to continue the original intent of the use of the Consumer Price Index, as defined by section 70.655.7, RSMo, the Board of Trustees of the Retirement System may also consider the Consumer Price Index for All Urban Consumers (CPI-U), as determined by the United States Department of Labor, when redetermining any amount of the retirees’ allowances. AUTHORITY: section 70.605.21, RSMo 2016.* Original rule filed Nov. 12, 2009, effective May 30, 2010. Amended: Filed May 3, 2019, effective Nov. 30, 2019. *Original authority: 70.605.21, RSMo 1967, amended 1974, 1992, 2000, 2003, 2013.