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accordance with State statutory requirements. The ruling found
that the officer received disability payments under a statute in
the nature of a workers' compensation act.
Where administrative rules or regulations have "the force
and effect of law" they will be found to be the equivalent of a
statute for purposes of section 1.104-1(b), Income Tax Regs.,
interpreting section 104(a)(1). As explained in Rutter v.
Commissioner, 760 F.2d 466, 468 (2d Cir. 1985), affg. T.C. Memo.
1984-525:
A regulation, like a statute, is a rule of general
applicability promulgated by a public agency to govern
conduct within the agency's jurisdiction. A labor
contract, unlike a statute, is an agreement between
union and employer, modifiable at any time. * * *
Where the language of a collective bargaining agreement is by
legislative act incorporated by reference into a municipal code,
and by this measure is enacted into law, it meets the statutory
and regulatory requirements described above. Cf. Givens v.
Commissioner, 90 T.C. 1145, 1149-1151 (1988).
The Collective Bargaining Agreement
Petitioners argue that their collective bargaining agreement
is incorporated by reference into the Cranston City Code. They
point to Rhode Island State law, and the City Charter in
conjunction with the City code. We examine first the State law
on which petitioners rely.
The Municipal Police Arbitration Act R.I. Gen. Laws secs.
28-9.2-1 through 28.9.2-16 (1986), establishes for police of the
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