Actuarial Analysis of the Proposed Settlement Agreement

February 10, 2014 Gina. M. Raimondo General Treasurer State House, Room 202 Providence, RI 02903 Richard A. Licht Director of Administration One Capitol Hill Providence, R.I. 02908 Re: Actuarial Analysis of the Proposed Settlement Agreement As requested, this is our actuarial analysis of the proposed settlement agreement (SA) as a result of the Rhode Island Retirement Security Act of 2011 (Act) which makes changes to all plans administered by the Employees Retirement System of Rhode Island (ERSRI), including: ERSRI State Employees (including Correctional Officers, and Nurses) ERSRI Teachers Municipal Employees Retirement System (MERS), including General Employers and Public Safety Judicial Retirement Benefits Trust (JRBT) State Police Retirement Benefits Trust (SPRBT) This analysis provides information on all of the Plans except for the JRBT and the SPRBT. Analysis on those Plans will be provided at a later time. Summary of Actuarial Impact of the SA The following exhibits provide the actuarial impact of the SA on the unfunded actuarial accrued liability (UAAL) and the FY2016 employer contributions. The contributions for FY2016 include allocations toward defined contribution accounts where applicable. Unfunded Actuarial Accrued Liability ($ in millions) as of June 30, 2013 Group Provisions Mediation Difference ERSRI - State Employees $ 1,879 $ 1,957 $ 78 ERSRI - Teachers 2,666 2,778 112 MERS - General Employees 176 199 23 MERS - Public Safety 101 120 19 Total $ 4,822 $ 5,054 $ 232

Treasurer Gina. M. Raimondo and Director Richard A. Licht February 10, 2014 Page 2 Estimated Employer Contribution Amounts, DB and DC combined ($ in millions) Fiscal Year 2016 Group Projected Payroll Provisions Mediation Difference Pre-RIRSA ERSRI - State Employees 718.3 $ 177.0 $ 184.8 $ 7.8 $ 310.1 ERSRI - Teachers 1,044.7 256.8 270.0 13.2 478.3 MERS - General Employees 249.0 34.2 36.8 2.6 57.9 MERS - Public Safety 96.7 17.7 18.3 0.6 39.3 Total $ 485.7 $ 509.9 $ 24.2 $ 885.6 Contribution estimates based on FY2013 payrolls projected to FY2016 at the 3.75% assumed payroll growth rate For comparative purposes, we have also included an estimate of what the employer contributions would have been had the RIRSA not passed. Summary of Proposed Changes in the SA The SA makes the following changes to all of the plans effective July 1, 2014, except where noted separately. A one-time 2% COLA payable immediately to all applicable retirees on the first $25,000 of pension benefit without the contingency of being 80% funded or the investment return. This does not impact the indexing of the $25,000 for future years. The COLA formula will become 50% of the COLA using the previous 5-year average of investment returns, with a maximum increase of 4%; and 50% of the previous Schedule B COLA, which is the previous year s CPI-U with a maximum increase of 3%. The COLA payment will be contingent on the individual plan being 80% funded. However, every 4 th year, if the COLA has been suspended for three consecutive years, the COLA may occur even if the plan is less than 80% funded. For State Workers, Teachers, and General MERS active members with 20 years of service as of June 30, 2012, they will receive future accruals (post July 1, 2014) at a rate of 2% per year and no longer participate in the defined contribution plan. The members will keep their DC balances as of 6/30/2014. For this accrual, these employees will pay higher member contribution rates beginning July 1, 2014, simultaneously with the increased accruals. For State workers and Teachers, the member contribution rate will be 11% of pay. For General MERS, the member contribution will be 8.25% or 9.25% depending on whether the unit has a COLA provision. For State Workers, Teachers, and General MERS active members with more than 10 years of service (but less than 20 years of service) as of June 30, 2012, there will be an additional employer contribution of 0.25% if the member has between 10 and 15 years of service and 0.50% if the member has between 15 and 20 years of service. For State Workers, Teachers, and General MERS active members who earn less than $35,000 per year, the administrative fee in the defined contribution plan will be waived.

Treasurer Gina. M. Raimondo and Director Richard A. Licht February 10, 2014 Page 3 State Workers, Teachers, and General MERS active members who were active on June 30, 2012 will be eligible to retire with full benefits at the earlier of their current RIRSA date or upon the attainment of age 65 with 30 years of service. For members who will be impacted by the RIRSA part-time anti-spiking rule, if the highest 5- year average calculation is less than the $35,000 cap under RIRSA, the pension will be based on the greater of the following: (1) highest 10 year average earnings, or (2) highest 5-year earnings with an indexed $35,000 cap. The Early retirement reduction for employees who choose to retire before eligible for full unreduced benefits will be based on the following schedule: 9% for year 1, 8% for year 2, 7% for each year thereafter. For Correctional officers active as of June 30, 2012 with fewer than 25 years of service as of that date, the benefit accrual will be 3% per year for years 31-35. For MERS P&F active employees as of June 30, 2012, members can retire with full benefits at the earlier of their current RIRSA retirement age or at the attainment of age 50 with at least 25 years of service. members will pay an additional 2.00% member contribution rate beginning July 1, 2014. For MERS P&F active members (including future hires), members who retire after July 1, 2014 and after attaining age 57 with 30 years of service will have a benefit equal to the greater of their current benefit and one calculated based on a 2.25% multiplier for all years of service. Analysis (Defined Benefit Plan) The results of our analysis are shown on the attached Exhibits S (ERSRI State Employees), T (ERSRI Teachers), and M (MERS). The revised provisions in the SA are reflected in the UAAL, funded ratio, and contribution rates into the defined benefit plan for FY 2016. Readers should keep in mind that any savings shown for Teachers is shared between the State (40%) and the municipal employers (60%). Exhibits S2 and T2 provide 30 year projections of the State and Teacher plans. These projections assume all assumptions are exactly met from FY2014 forward. In the defined benefit exhibits, the payrolls shown for all groups reflect our estimate of future covered payrolls based on projecting the actual FY2013 payrolls. In every case, the actual dollar contributions should be based on actual payrolls and the contribution rates shown. Under Rhode Island General Laws (RIGL) 36-10-2(g), if the State s actuarially determined contribution rate for state employees or for teachers for a fiscal year will be less than in the preceding fiscal year, the Governor is required to include an appropriation to ERSRI in the fiscal year budget equal to 20% of the reduction.

Treasurer Gina. M. Raimondo and Director Richard A. Licht February 10, 2014 Page 4 Budgetary Impact for each Employer Individual employers could have employees across several benefit structures, most commonly Teachers, General MERS, and MERS Public Safety. In addition, the defined contribution component of the SA will impact the budget as an additional cost. In Exhibit B, we have provided a listing of each local employer along with the impact the SA will have on their estimated FY2016 budget. These amounts are based on the actual Fiscal Year 2013 payrolls projected forward at the 3.75% payroll growth rate. Data and Assumptions We prepared our analysis as though the bill would be effective July 1, 2014 and will impact the fiscal year 2016 contribution rates. We assume the fiscal year 2014 and 2015 employer contribution rates would remain unchanged. To prepare these analyses, we used member and financial data supplied by ERSRI as of June 30, 2013. We based the analyses on the actuarial assumptions and methods previously adopted by the Retirement Board. However, in connection with the retirement eligibility analyses, we modified the retirement rates consistent with the proposals. Anyone we would have assumed would retire under the current provisions before the earliest allowable age under the proposal was assumed to retire once eligible. In addition, we assume no members would retire within 1 year of the 57/30 provision and an additional 20% of members would retire immediately upon attaining 57/30. For future benefit adjustments, we assumed the average adjustment would be 2.1% and be provided without suspension for all MERS units because most of these plans will be 80% funded after the legislation passes. For State Employees, Teachers, State Police, and Judges based on projections and the 25-year re-amortization, we project the benefit adjustments will be suspended for approximately 15 years, except for the intermittent adjustment every fourth year. Other General Comments This letter is intended to describe the financial and actuarial effect of the proposed plan changes on ERSRI. Changes in retirement eligibility, for example, could impact the cost of post-retirement medical benefits, but we have not analyzed this effect. Our calculations are based upon assumptions regarding future events, which may or may not materialize. Please bear in mind that actual results could deviate significantly from our projections, depending on actual plan experience. We are not attorneys, and nothing in this letter should be construed as providing legal or tax advice. No statement in this letter is intended to be interpreted as a recommendation in favor of the changes or in opposition to them.

Treasurer Gina. M. Raimondo and Director Richard A. Licht February 10, 2014 Page 5 We certify that the undersigned are members of the American Academy of Actuaries and that we meet the Qualification Standards of the American Academy of Actuaries to render the actuarial opinion contained herein. If you have any questions, or require any additional clarifying information, please do not hesitate to contact either one of the undersigned. Respectfully submitted, Joseph P. Newton, FSA, MAAA, EA Senior Consultant Mark R. Randall, MAAA, EA Executive Vice President Enclosures cc: Mr. Frank Karpinski Mr. Mark Dingley

Exhibit S: State Employees Employees' Retirement System of Rhode Island - State Employees Defined Benefit Contributions Only Based on the June 30, 2013 Actuarial Valuation Provisions Mediation 1.a. Unfunded actuarial accrued liability $ 1,878.8 $ 1,957.0 1.b. Change 78.2 2.a. Funded ratio 56.2% 55.2% 2.b. Change -1.0% FY2016 Contribution Information 3.a. Contribution rate for FY 2016 23.64% 24.87% 3.b. Change 1.23% 4.a. Projected FY 2016 payroll $ 718.3 $ 718.3 4.b. Projected contribution 169.8 178.6 4.c. Change 8.8 $ in millions

Exhibit T: Teachers Employees' Retirement System of Rhode Island - Teachers Defined Benefit Contributions Only Based on the June 30, 2013 Actuarial Valuation Provisions Mediation 1.a. Unfunded actuarial accrued liability $ 2,665.9 $ 2,778.5 1.b. Change 112.5 2.a. Funded ratio 58.1% 57.1% 2.b. Change -1.01% FY2016 Contribution Information 3.a. Contribution rate for FY 2016 23.13% 24.41% 3.b. Change 1.28% 4.a. Projected FY 2016 payroll $ 1,044.7 $ 1,044.7 4.b. Projected contribution 241.6 255.0 4.c. Change 13.4 $ in millions

Exhibit S2: State Employees Projection Results Based on the June 30, 2013 Actuarial Valuation, Mediated Changes State Employees, 22 Year Amortization beginning 7/1/2013, 20 year ladders starting with 2015 valuation Investment Return: 7.50% each year Employer Contributions for Fiscal Year (in Actuarial Accrued Liability at Actuarial Value of Assets at Unfunded Actuarial Accrued Liability at (UAAL, in Employer Contribution Rate Calculated in Actuarial Market Value of Assets at (MVA, in Fiscal Year Employer Compensation for Valuation as of Ending June Market Return for Contribution Rate Fiscal Year (in Funded Ratio at June 30, 30, Fiscal Year for Fiscal Year Millions) Millions) (AAL, in Millions) (AVA, in Millions) Millions) Valuation Millions) (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) Funded Ratio Using MVA at 2013 2014 7.50% 23.05% $ 667.3 $ 153.8 $ 4,368.1 $ 2,411.1 $ 1,957.0 55.2% 24.87% $ 2,346.9 53.7% 2014 2015 7.50% 23.33% 692.4 161.5 4,404.4 2,399.5 2,004.9 54.5% 24.84% 2,356.7 53.5% 2015 2016 7.50% 24.87% 718.3 178.6 4,452.6 2,406.1 2,046.5 54.0% 24.85% 2,384.7 53.6% 2016 2017 7.50% 24.84% 741.1 184.1 4,501.1 2,429.9 2,071.2 54.0% 24.98% 2,429.9 54.0% 2017 2018 7.50% 24.85% 760.4 189.0 4,549.7 2,481.1 2,068.6 54.5% 25.03% 2,481.1 54.5% 2018 2019 7.50% 24.98% 779.6 194.7 4,595.9 2,535.4 2,060.5 55.2% 25.09% 2,535.4 55.2% 2019 2020 7.50% 25.03% 800.4 200.3 4,641.9 2,596.2 2,045.7 55.9% 25.14% 2,596.2 55.9% 2020 2021 7.50% 25.09% 825.7 207.2 4,686.7 2,663.0 2,023.7 56.8% 25.09% 2,663.0 56.8% 2021 2022 7.50% 25.14% 852.2 214.2 4,729.8 2,737.2 1,992.6 57.9% 25.05% 2,737.2 57.9% 2022 2023 7.50% 25.09% 880.3 220.9 4,767.8 2,816.4 1,951.4 59.1% 25.00% 2,816.4 59.1% 2023 2024 7.50% 25.05% 910.9 228.2 4,803.6 2,903.3 1,900.3 60.4% 24.94% 2,903.3 60.4% 2024 2025 7.50% 25.00% 942.0 235.5 4,837.4 2,999.8 1,837.6 62.0% 24.88% 2,999.8 62.0% 2025 2026 7.50% 24.94% 974.4 243.0 4,869.0 3,106.3 1,762.7 63.8% 24.83% 3,106.3 63.8% 2026 2027 7.50% 24.88% 1,008.4 250.9 4,896.6 3,222.4 1,674.2 65.8% 24.79% 3,222.4 65.8% 2027 2028 7.50% 24.83% 1,044.7 259.4 4,920.6 3,349.4 1,571.2 68.1% 24.73% 3,349.4 68.1% 2028 2029 7.50% 24.79% 1,081.8 268.2 4,940.3 3,489.3 1,451.0 70.6% 24.70% 3,489.3 70.6% 2029 2030 7.50% 24.73% 1,122.6 277.6 4,958.8 3,645.3 1,313.5 73.5% 24.63% 3,645.3 73.5% 2030 2031 7.50% 24.70% 1,164.3 287.6 4,977.4 3,820.7 1,156.7 76.8% 24.58% 3,820.7 76.8% 2031 2032 7.50% 24.63% 1,208.6 297.7 4,997.0 4,018.6 978.4 80.4% 24.51% 4,018.6 80.4% 2032 2033 7.50% 24.58% 1,254.8 308.4 5,019.2 4,242.1 777.1 84.5% 24.45% 4,242.1 84.5% 2033 2034 7.50% 24.51% 1,303.0 319.4 5,044.9 4,494.6 550.3 89.1% 3.27% 4,494.6 89.1% 2034 2035 7.50% 24.45% 1,354.1 331.1 5,087.2 4,791.1 296.1 94.2% 2.95% 4,791.1 94.2% 2035 2036 7.50% 3.27% 1,406.6 46.0 5,136.7 5,125.0 11.7 99.8% 2.70% 5,125.0 99.8% 2036 2037 7.50% 2.95% 1,460.3 43.1 5,193.8 5,191.3 2.5 100.0% 2.44% 5,191.3 100.0% 2037 2038 7.50% 2.70% 1,515.9 40.9 5,259.1 5,262.4 (3.3) 100.1% 2.42% 5,262.4 100.1% 2038 2039 7.50% 2.44% 1,573.3 38.4 5,333.0 5,339.3 (6.3) 100.1% 2.39% 5,339.3 100.1% 2039 2040 7.50% 2.42% 1,632.8 39.5 5,416.1 5,421.8 (5.7) 100.1% 2.37% 5,421.8 100.1% 2040 2041 7.50% 2.39% 1,695.0 40.5 5,509.5 5,514.5 (5.0) 100.1% 2.35% 5,514.5 100.1% 2041 2042 7.50% 2.37% 1,758.9 41.7 5,613.7 5,617.8 (4.1) 100.1% 2.34% 5,617.8 100.1% 2042 2043 7.50% 2.35% 1,825.4 42.9 5,729.3 5,732.3 (3.0) 100.1% 2.33% 5,732.3 100.1% 2043 2044 7.50% 2.34% 1,894.1 44.3 5,856.8 5,858.5 (1.7) 100.0% 2.32% 5,858.5 100.0% 2044 2045 7.50% 2.33% 1,965.0 45.8 5,996.8 5,997.2 (0.4) 100.0% 2.32% 5,997.2 100.0%

Exhibit T2: Teachers Projection Results Based on the June 30, 2013 Actuarial Valuation Teachers, 22 Year Amortization beginning 7/1/2013, 20 year ladders starting with 2015 valuation Investment Return: 7.50% each year Employer Contributions for Fiscal Year (in Actuarial Accrued Liability at Actuarial Value of Assets at Unfunded Actuarial Accrued Liability at (UAAL, in Employer Contribution Rate Calculated in Actuarial Market Value of Assets at (MVA, in Fiscal Year Employer Compensation for Valuation as of Ending June Market Return for Contribution Rate Fiscal Year (in Funded Ratio at June 30, 30, Fiscal Year for Fiscal Year Millions) Millions) (AAL, in Millions) (AVA, in Millions) Millions) Valuation Millions) (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) Funded Ratio Using MVA at 2013 2014 7.50% 20.68% $ 970.5 $ 200.7 $ 6,476.2 $ 3,697.8 $ 2,778.5 57.1% 24.41% $ 3,601.8 55.6% 2014 2015 7.50% 22.60% 1,006.9 227.6 6,533.5 3,664.3 2,869.2 56.1% 24.50% 3,600.3 55.1% 2015 2016 7.50% 24.41% 1,044.7 255.0 6,607.8 3,674.4 2,933.4 55.6% 24.55% 3,642.4 55.1% 2016 2017 7.50% 24.50% 1,079.6 264.5 6,687.4 3,716.4 2,971.0 55.6% 24.66% 3,716.4 55.6% 2017 2018 7.50% 24.55% 1,110.5 272.6 6,772.1 3,805.3 2,966.8 56.2% 24.66% 3,805.3 56.2% 2018 2019 7.50% 24.66% 1,140.8 281.3 6,857.5 3,903.8 2,953.7 56.9% 24.69% 3,903.8 56.9% 2019 2020 7.50% 24.66% 1,173.2 289.3 6,947.6 4,017.2 2,930.4 57.8% 24.71% 4,017.2 57.8% 2020 2021 7.50% 24.69% 1,209.5 298.6 7,040.3 4,143.7 2,896.6 58.9% 24.66% 4,143.7 58.9% 2021 2022 7.50% 24.71% 1,247.3 308.2 7,134.7 4,284.7 2,850.0 60.1% 24.61% 4,284.7 60.1% 2022 2023 7.50% 24.66% 1,287.0 317.4 7,226.4 4,436.9 2,789.5 61.4% 24.59% 4,436.9 61.4% 2023 2024 7.50% 24.61% 1,331.0 327.6 7,321.2 4,606.3 2,714.9 62.9% 24.49% 4,606.3 62.9% 2024 2025 7.50% 24.59% 1,370.8 337.1 7,415.3 4,792.1 2,623.2 64.6% 24.49% 4,792.1 64.6% 2025 2026 7.50% 24.49% 1,413.0 346.0 7,508.5 4,995.4 2,513.1 66.5% 24.49% 4,995.4 66.5% 2026 2027 7.50% 24.49% 1,457.5 356.9 7,595.6 5,212.2 2,383.4 68.6% 24.46% 5,212.2 68.6% 2027 2028 7.50% 24.49% 1,502.3 367.9 7,677.9 5,444.7 2,233.2 70.9% 24.48% 5,444.7 70.9% 2028 2029 7.50% 24.46% 1,550.3 379.2 7,757.3 5,696.4 2,060.9 73.4% 24.51% 5,696.4 73.4% 2029 2030 7.50% 24.48% 1,600.5 391.8 7,835.9 5,971.6 1,864.3 76.2% 24.52% 5,971.6 76.2% 2030 2031 7.50% 24.51% 1,652.7 405.1 7,914.4 6,274.3 1,640.1 79.3% 24.54% 6,274.3 79.3% 2031 2032 7.50% 24.52% 1,706.3 418.4 7,993.9 6,608.4 1,385.5 82.7% 24.59% 6,608.4 82.7% 2032 2033 7.50% 24.54% 1,763.4 432.7 8,076.1 6,977.9 1,098.2 86.4% 24.61% 6,977.9 86.4% 2033 2034 7.50% 24.59% 1,821.9 448.0 8,161.8 7,386.8 775.0 90.5% 2.99% 7,386.8 90.5% 2034 2035 7.50% 24.61% 1,879.0 462.4 8,262.1 7,850.6 411.5 95.0% 2.65% 7,850.6 95.0% 2035 2036 7.50% 2.99% 1,941.5 58.0 8,368.7 8,362.1 6.6 99.9% 2.33% 8,362.1 99.9% 2036 2037 7.50% 2.65% 2,004.0 53.1 8,480.8 8,490.0 (9.2) 100.1% 2.03% 8,490.0 100.1% 2037 2038 7.50% 2.33% 2,066.7 48.2 8,597.6 8,618.4 (20.8) 100.2% 1.99% 8,618.4 100.2% 2038 2039 7.50% 2.03% 2,133.2 43.3 8,720.7 8,748.1 (27.4) 100.3% 1.95% 8,748.1 100.3% 2039 2040 7.50% 1.99% 2,199.4 43.8 8,848.6 8,877.7 (29.1) 100.3% 1.90% 8,877.7 100.3% 2040 2041 7.50% 1.95% 2,267.8 44.2 8,980.5 9,011.3 (30.8) 100.3% 1.87% 9,011.3 100.3% 2041 2042 7.50% 1.90% 2,339.0 44.4 9,116.2 9,148.6 (32.4) 100.4% 1.85% 9,148.6 100.4% 2042 2043 7.50% 1.87% 2,411.7 45.1 9,255.2 9,288.7 (33.5) 100.4% 1.83% 9,288.7 100.4% 2043 2044 7.50% 1.85% 2,489.5 46.1 9,398.2 9,432.7 (34.5) 100.4% 1.82% 9,432.7 100.4% 2044 2045 7.50% 1.83% 2,574.6 47.1 9,548.8 9,584.0 (35.2) 100.4% 1.80% 9,584.0 100.4%

Unit Exhibit M: MERS Municipal Employees Retirement System (Defined Benefit Contributions Only) Based on the June 30, 2013 Actuarial Valuation FY2016 Contribution Rate UAAL as of June 30, 2013 Funded Ratio as of June 30, 2013 Mediation Provisions Difference Mediation Provisions Difference Mediation Provisions Difference (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) Bristol 15.96% 14.95% 1.01% 6,067,708 5,636,795 430,913 71.9% 73.4% -1.5% Burrillville 9.56% 8.52% 1.04% 1,154,985 554,123 600,862 95.5% 97.8% -2.3% Central Falls 13.94% 13.62% 0.32% 2,221,204 2,181,562 39,642 68.6% 69.0% -0.4% Charlestown 10.55% 9.86% 0.69% 987,790 885,039 102,751 85.2% 86.5% -1.3% Cranston 11.10% 9.86% 1.24% 9,567,170 6,510,758 3,056,412 92.9% 95.1% -2.2% Cumberland 14.01% 13.64% 0.37% 7,767,896 7,570,813 197,082 73.1% 73.6% -0.5% East Greenwich 6.17% 5.31% 0.87% (881,541) (1,020,549) 139,007 113.3% 115.8% -2.5% East Providence 26.66% 25.19% 1.47% 43,379,129 40,988,292 2,390,836 57.8% 59.1% -1.3% West Greenwich 13.28% 12.36% 0.92% 1,858,802 1,637,978 220,825 81.0% 82.9% -1.9% Foster 12.21% 11.83% 0.38% 621,558 598,266 23,291 83.3% 83.8% -0.5% Glocester 10.54% 9.77% 0.77% 977,269 814,630 162,639 88.4% 90.2% -1.8% Hopkinton 5.32% 4.77% 0.55% (606,503) (684,605) 78,101 115.2% 117.5% -2.3% Jamestown 11.47% 10.69% 0.78% 2,106,730 1,865,123 241,607 83.7% 85.3% -1.6% Johnston 17.29% 16.09% 1.20% 11,510,568 10,502,266 1,008,301 71.8% 73.6% -1.8% Lincoln 12.87% 12.70% 0.17% 632,442 614,059 18,383 69.2% 69.8% -0.6% Middletown 11.63% 10.82% 0.81% 3,880,616 3,492,278 388,339 79.9% 81.5% -1.6% Newport 23.28% 21.86% 1.42% 26,373,725 24,742,841 1,630,885 62.5% 64.0% -1.5% New Shoreham 8.61% 8.01% 0.60% 293,819 184,062 109,757 95.2% 96.9% -1.7% North Kingstown 18.66% 17.44% 1.22% 16,603,123 15,283,876 1,319,247 72.0% 73.6% -1.6% North Providence 7.16% 6.82% 0.34% (644,041) (831,309) 187,268 102.5% 103.2% -0.7% North Smithfield 7.28% 6.44% 0.84% (532,606) (817,519) 284,913 104.2% 106.6% -2.4% Pawtucket 18.28% 16.91% 1.37% 30,281,059 27,549,703 2,731,357 74.1% 75.9% -1.8% Union Fire District 7.93% 7.74% 0.19% 29,296 28,838 458 94.8% 94.9% -0.1% Richmond 10.26% 10.00% 0.26% 394,864 375,570 19,294 81.7% 82.4% -0.7% Scituate 15.80% 14.71% 1.09% 3,156,068 2,888,445 267,623 75.5% 77.1% -1.6% Smithfield 9.31% 8.47% 0.84% 508,318 248,581 259,736 95.8% 97.9% -2.1% South Kingstown 12.24% 11.25% 0.99% 7,210,699 6,072,771 1,137,928 86.6% 88.5% -1.9% Tiverton 3.96% 3.19% 0.77% (1,853,185) (2,058,381) 205,196 118.6% 121.0% -2.4% Warren 13.49% 12.68% 0.81% 2,037,513 1,904,597 132,916 69.4% 70.8% -1.4% Westerly 84.07% 82.86% 1.21% 797,279 786,885 10,394 16.3% 16.5% -0.2%

Unit Exhibit M: MERS Municipal Employees Retirement System (Defined Benefit Contributions Only) Based on the June 30, 2013 Actuarial Valuation FY2016 Contribution Rate UAAL as of June 30, 2013 Funded Ratio as of June 30, 2013 Mediation Provisions Difference Mediation Provisions Difference Mediation Provisions Difference (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) West Greenwich 17.52% 16.50% 1.02% 1,444,601 1,343,766 100,834 61.6% 63.3% -1.7% Woonsocket 11.64% 10.27% 1.37% 5,671,423 4,055,652 1,615,772 91.2% 93.6% -2.4% Chariho School District 11.55% 10.73% 0.82% 3,180,511 2,834,255 346,255 82.7% 84.3% -1.6% Foster/Glocester 12.66% 11.75% 0.91% 1,102,423 945,464 156,959 83.7% 85.7% -2.0% Tiogue Fire & Lighting 0.00% 0.00% 0.00% (19,594) (20,541) 947 177.1% 184.0% -6.9% Narragansett Housing 6.09% 5.71% 0.38% (29,862) (35,849) 5,987 107.2% 108.8% -1.6% Coventry Lighting District 0.00% 0.00% 0.00% (351,944) (366,951) 15,007 142.1% 144.7% -2.6% Hope Valley Fire 3.11% 2.83% 0.28% (112,444) (115,327) 2,883 128.3% 129.2% -0.9% East Greenwich Housing 10.76% 10.22% 0.54% 151,004 130,438 20,566 88.2% 89.7% -1.5% Cranston Housing 8.13% 7.45% 0.68% (298,317) (359,071) 60,754 107.3% 108.9% -1.6% East Providence Housing 12.52% 11.54% 0.98% 447,675 371,527 76,148 85.7% 87.8% -2.1% Pawtucket Housing 0.00% 0.00% 0.00% (3,574,776) (3,737,896) 163,120 139.5% 142.1% -2.6% Cumberland Housing 7.94% 7.36% 0.58% 72,041 45,111 26,929 94.3% 96.4% -2.1% Lincoln Housing 16.79% 15.90% 0.89% 605,403 562,643 42,760 71.6% 73.1% -1.5% Bristol Housing 0.00% 0.00% 0.00% (540,751) (551,093) 10,342 139.4% 140.5% -1.1% Burrillville Housing 8.66% 7.58% 1.08% 62,486 39,895 22,591 93.4% 95.7% -2.3% North Providence Housing 29.08% 27.46% 1.62% 803,321 763,959 39,362 49.7% 50.9% -1.2% East Smithfield Water 3.56% 2.19% 1.37% (103,819) (123,391) 19,572 112.9% 115.7% -2.8% Greenville Water 2.55% 1.96% 0.59% (214,669) (231,592) 16,923 124.7% 127.1% -2.4% Newport Housing 19.64% 18.33% 1.31% 2,594,387 2,386,377 208,011 70.3% 72.0% -1.7% Warren Housing 6.79% 6.03% 0.76% (67,118) (89,883) 22,765 105.7% 107.8% -2.1% Johnston Housing 11.73% 11.52% 0.21% 233,017 223,247 9,770 82.4% 83.0% -0.6% Tiverton Local 2670A 9.47% 8.52% 0.95% 249,089 154,104 94,985 93.5% 95.9% -2.4% Barrington COLA 9.32% 8.48% 0.84% 1,547,739 933,283 614,456 95.1% 97.0% -1.9% Coventry Housing 10.92% 10.79% 0.13% 266,680 257,683 8,998 78.1% 78.7% -0.6% South Kingstown Housing 2.85% 2.59% 0.26% (128,146) (130,584) 2,438 168.9% 171.1% -2.2% N. RI Collaborative Adm. Services 9.79% 8.94% 0.85% 292,053 215,686 76,367 89.9% 92.3% -2.4% West Warwick Housing 10.09% 9.42% 0.67% 191,360 165,220 26,140 89.0% 90.3% -1.3% Smithfield Housing 2.68% 2.26% 0.42% (97,764) (95,497) (2,267) 134.6% 133.6% 1.0% Smithfield COLA 10.62% 9.73% 0.89% 1,604,288 1,329,382 274,906 88.9% 90.6% -1.7%

Unit Exhibit M: MERS Municipal Employees Retirement System (Defined Benefit Contributions Only) Based on the June 30, 2013 Actuarial Valuation FY2016 Contribution Rate UAAL as of June 30, 2013 Funded Ratio as of June 30, 2013 Mediation Provisions Difference Mediation Provisions Difference Mediation Provisions Difference (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) Central Falls Housing 11.85% 11.14% 0.71% 771,131 710,673 60,458 71.4% 73.0% -1.6% Lime Rock Administrative Services 13.80% 13.25% 0.55% 82,907 82,809 98 75.1% 75.1% 0.0% Central Falls Schools 8.85% 8.00% 0.85% 955,237 594,892 360,346 93.3% 95.7% -2.4% Bristol/Warren Schools 18.60% 17.37% 1.23% 6,879,268 6,322,394 556,874 68.7% 70.5% -1.8% Town of E. Greenwich-COLA-NCE 6.17% 5.31% 0.87% (734,760) (1,113,652) 378,892 104.0% 106.2% -2.2% Harrisville Fire District (ADMIN) 8.28% 7.62% 0.66% 7,190 1,054 6,136 98.7% 99.8% -1.1% East Greenwich Fire (ADMIN) 9.64% 8.99% 0.65% 45,922 40,367 5,555 87.0% 88.3% -1.3% Albion Fire District (ADMIN) 0.00% 0.00% 0.00% (7,255) (7,255) (0) 107.3% 107.3% 0.0% General Employee Units Average 13.77% 12.76% 1.02% 198,881,693 176,037,087 22,844,606 81.5% 83.3% -1.8% Johnston Fire 9.24% 9.24% 0.00% 374,963 224,989 149,974 91.6% 94.8% -3.2% Richmond Police 12.37% 12.37% 0.00% 495,502 415,901 79,601 70.4% 74.0% -3.6% Smithfield Police 8.07% 6.93% 1.14% (8,617) (666,243) 657,626 100.1% 106.4% -6.3% Valley Falls Fire 16.65% 16.65% 0.00% 1,065,449 956,834 108,615 74.1% 76.1% -2.0% North Smithfield Voluntary Fire 17.48% 17.15% 0.33% 1,459,856 1,255,793 204,062 80.1% 82.4% -2.3% East Greenwich Fire 27.14% 26.48% 0.66% 6,742,110 6,171,653 570,457 60.3% 62.4% -2.1% East Greenwich Police 28.58% 27.93% 0.65% 5,953,312 5,410,860 542,452 68.1% 70.2% -2.1% North Kingstown Fire 30.92% 30.04% 0.88% 13,047,622 11,947,908 1,099,713 67.4% 69.3% -1.9% North Kingstown Police 26.89% 25.44% 1.45% 8,443,213 7,511,162 932,052 67.5% 70.0% -2.5% North Providence Fire 23.56% 23.56% 0.00% 11,801,520 11,190,487 611,033 70.5% 71.6% -1.1% Barrington Fire (25) 9.53% 9.02% 0.51% 342,791 197,288 145,502 83.4% 89.7% -6.3% Barrington Police 31.25% 29.80% 1.45% 5,166,107 4,709,402 456,705 59.0% 61.2% -2.2% Barrington Fire (20) 93.54% 89.59% 3.95% 2,788,714 2,606,988 181,726 71.9% 73.2% -1.3% Warren Police & Fire 28.60% 27.86% 0.74% 4,683,344 4,313,972 369,372 64.1% 66.0% -1.9% South Kingstown Police 26.22% 24.71% 1.51% 7,426,696 6,484,929 941,767 73.3% 75.9% -2.6% Scituate Police 0.00% 0.00% 0.00% (161,360) (161,797) 437 822.5% 838.9% -16.4% North Smithfield Police 23.81% 21.79% 2.02% 2,860,259 2,440,310 419,949 74.2% 77.1% -2.9% Tiverton Fire 15.54% 14.13% 1.41% 1,974,926 1,478,747 496,179 82.0% 85.9% -3.9% Foster Police 34.08% 32.58% 1.50% 1,415,683 1,277,398 138,285 63.6% 66.0% -2.4% Woonsocket Police 27.61% 26.08% 1.53% 15,376,744 13,632,522 1,744,222 67.4% 70.0% -2.6%

Unit Exhibit M: MERS Municipal Employees Retirement System (Defined Benefit Contributions Only) Based on the June 30, 2013 Actuarial Valuation FY2016 Contribution Rate UAAL as of June 30, 2013 Funded Ratio as of June 30, 2013 Mediation Provisions Difference Mediation Provisions Difference Mediation Provisions Difference (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) Charlestown Police 24.27% 23.45% 0.82% 3,290,967 2,946,724 344,242 69.1% 71.4% -2.3% Hopkinton Police 31.17% 29.40% 1.77% 2,691,421 2,409,193 282,228 65.4% 67.8% -2.4% Glocester Police 18.95% 17.89% 1.06% 1,513,369 1,224,897 288,472 77.0% 80.5% -3.5% West Greenwich Police/Rescue 22.49% 22.45% 0.04% 1,489,124 1,361,350 127,773 67.8% 69.7% -1.9% Burrillville Police 26.57% 25.65% 0.92% 2,805,374 2,475,707 329,667 74.7% 77.0% -2.3% Cumberland Rescue 11.12% 11.12% 0.00% 350,200 162,343 187,858 93.2% 96.7% -3.5% Woonsocket Fire 11.71% 11.28% 0.43% 3,371,185 1,902,954 1,468,231 91.5% 95.0% -3.5% Bristol Fire 24.92% 24.92% 0.00% 79,356 75,600 3,755 75.4% 76.2% -0.8% Cumberland Hill Fire 30.35% 28.57% 1.78% 2,174,386 1,935,830 238,556 63.4% 66.1% -2.7% Bristol Police 6.57% 5.84% 0.73% (450,096) (827,403) 377,307 110.3% 120.7% -10.4% Coventry Fire 21.46% 21.46% 0.00% 2,031,782 1,838,505 193,277 60.0% 62.4% -2.4% South Kingstown EMT 5.64% 5.34% 0.30% (323,338) (456,398) 133,060 111.4% 116.9% -5.5% North Cumberland 21.05% 21.05% 0.00% 1,246,471 1,093,534 152,937 75.8% 78.2% -2.4% Central Coventry Fire 16.52% 16.52% 0.00% 3,310,351 2,881,405 428,946 71.1% 73.9% -2.8% Hopkins Hill Fire 13.92% 13.92% 0.00% 260,552 200,820 59,732 86.9% 89.6% -2.7% Cranston Police 10.64% 9.82% 0.82% 3,099,782 1,128,480 1,971,302 89.6% 95.9% -6.3% Cranston Fire 8.15% 8.15% 0.00% (1,622,590) (2,932,690) 1,310,100 103.8% 107.2% -3.4% Cumberland Fire 23.50% 23.37% 0.13% 1,412,628 1,267,643 144,985 70.4% 72.6% -2.2% Lincoln Rescue 19.40% 18.07% 1.33% 1,569,072 1,319,355 249,718 63.3% 67.3% -4.0% New Shoreham Police 23.45% 23.45% 0.00% 532,383 493,130 39,253 64.5% 66.3% -1.8% Middletown Police & Fire 6.40% 6.40% 0.00% (627,230) (892,073) 264,843 119.7% 130.6% -10.9% Harrisville Fire District 7.87% 7.87% 0.00% (73,125) (91,237) 18,112 107.8% 109.9% -2.1% Albion Fire District 19.61% 17.45% 2.16% 344,620 266,152 78,468 63.1% 68.9% -5.8% Johnston Police 8.98% 8.98% 0.00% 15,473 12,216 3,257 85.3% 88.0% -2.7% Smithfield Fire 10.31% 10.31% 0.00% 39,469 32,979 6,490 93.4% 94.4% -1.0% Police & Fire Units Average 17.70% 17.05% 0.65% 119,780,418 101,228,117 18,552,301 77.0% 79.8% -2.8% All MERS Units Average 14.87% 13.96% 0.91% 318,662,111 277,265,205 41,396,906 80.0% 82.1% -2.1%

Exhibit B: Combined Estimated Budgetary Impact on Local Employers $ in 000s FY2016 Projected Contributions Unit With Mediation Increase from SA Pre-RIRSA Pre-RIRSA less (1) (2) (3) (4) (5) Barrington $ 5,809,194 $ 6,106,311 $ 297,117 $ 10,185,686 $ 4,376,492 Bristol/Warren 6,609,782 6,943,946 334,164 11,420,231 4,810,449 Burrillville 3,445,495 3,642,203 196,708 6,070,817 2,625,322 Central Falls 4,009,779 4,225,417 215,638 7,434,267 3,424,488 Chariho (Charlestown, Richmond, Hopkinton) 5,983,406 6,298,191 314,785 11,480,007 5,496,601 Coventry 7,357,815 7,647,075 289,260 12,725,084 5,367,269 Cranston 18,506,084 19,503,871 997,787 34,903,001 16,396,917 Cumberland 7,169,306 7,442,666 273,360 11,671,666 4,502,360 East Greenwich 4,662,209 4,892,016 229,807 8,690,982 4,028,773 East Providence 10,101,077 10,607,351 506,274 16,285,701 6,184,624 Exeter/ West Greenwich 3,151,535 3,311,158 159,623 5,886,504 2,734,969 Foster/ Glocester 3,579,051 3,753,866 174,815 6,072,739 2,493,688 Jamestown 1,061,961 1,123,519 61,558 1,984,724 922,763 Johnston 5,698,962 5,977,143 278,181 9,515,863 3,816,901 Lincoln 4,943,600 5,170,289 226,689 8,209,213 3,265,613 Little Compton 410,339 429,455 19,116 698,126 287,787 Middletown 4,262,266 4,458,917 196,651 7,550,037 3,287,771 Narragansett 2,190,204 2,288,332 98,128 3,672,579 1,482,375 New Shoreham 528,156 555,773 27,617 976,631 448,475 Newport 6,055,567 6,382,017 326,450 10,045,646 3,990,079 North Kingstown 8,578,304 9,024,437 446,133 16,145,024 7,566,720 North Providence 5,693,219 5,909,835 216,616 9,661,655 3,968,436 North Smithfield 2,477,530 2,630,691 153,161 4,963,900 2,486,370 Northern RI Collaborative 418,639 443,293 24,654 783,284 364,645 Pawtucket 12,136,551 12,849,256 712,705 22,770,758 10,634,207 Portsmouth 2,953,122 3,085,217 132,095 4,941,775 1,988,653 Providence 23,556,705 24,757,571 1,200,866 44,925,532 21,368,827 Scituate 2,238,089 2,349,570 111,481 3,732,967 1,494,878 Smithfield 4,029,214 4,267,765 238,551 7,560,490 3,531,276 South Kingstown 6,919,836 7,329,457 409,621 13,236,649 6,316,813 Tiverton 2,734,956 2,897,400 162,444 4,923,538 2,188,582 Warwick 12,645,715 13,290,364 644,649 24,116,933 11,471,218 West Bay Collaborative Teachers 122,878 129,142 6,264 234,344 111,466 West Warwick 3,752,024 3,944,008 191,984 7,136,884 3,384,860 Westerly 4,543,731 4,745,013 201,282 7,571,977 3,028,246 Woonsocket 9,474,460 10,033,468 559,008 18,501,305 9,026,845 Charter School Teachers 309,474 325,250 15,776 590,205 280,731 Paul Cuffee School 682,348 717,132 34,784 1,301,321 618,973 Kingston Hill Academy, Inc. 128,548 135,101 6,553 245,157 116,609 International School 295,532 310,598 15,066 563,616 268,084 The Compass School 121,089 127,262 6,173 230,931 109,842 The Blackstone Academy 85,235 89,580 4,345 162,554 77,319 Beacon Charter School of Woonsocket 208,432 219,057 10,625 397,505 189,073 *1711 483,096 507,723 24,627 921,324 438,228 *1721 192,940 202,776 9,836 367,961 175,021 *1731 145,497 152,914 7,417 277,480 131,983 *1741 98,908 103,950 5,042 188,629 89,721 *1751 129,183 135,768 6,585 246,368 117,185 Total $ 210,691,043 $ 221,473,115 $ 10,782,072 $ 382,179,571 $ 171,488,528 * Misc Teacher Agency Code