TITLE OF BILL: An act to amend the retirement and social security
law, in relation to participation by public or quasi-public
organizations in the retirement system
PURPOSE: To limit participation by officers and employees of certain
private organizations in the New York State public retirement system.
SUMMARY OF PROVISIONS:
Section 1 of the bill amends section 31 of the retirement and social
security law in relation to participation of new employees of certain
private organizations in the New York State pension system.
Section 2 of the bill amends section 609 of the retirement and social
security law in relation to additional service credit for current
employees of certain private organizations in the New York State
Section 3 is a severability clause.
Section 4 of the bill is the effective date.
JUSTIFICATION: The NYS retirement system is one of the largest in the
nation - with over a million participants and having a value of almost
$160 billion. The system is a benefit to hardworking public employees
and it is a benefit to state and local government in terms of
attracting and retaining qualified employees. As much as the
retirement system is a benefit, it is also a financial burden -
especially to local governments. According to the NYS Office of the
State Comptroller, for the 2011-2012 fiscal year, contributions to the
retirement system from government employers totaled over $4.5 billion.
In recent years, the NYS Legislature has acted responsibly in passing
measures to help control the cost of the state pension system,
particularly for local governments And, although reform measures such
as new pension tiers have been established, there are still other
problems with the pension system that must be fixed. A prime example
of this is the state's law permitting employees of certain private
organizations to participate in the state's public retirement system.
Under current law, officers and employees of private organizations
such as the NYS Association of Counties, the NYS School Boards
Association, the Association of Towns of the State of New York, and
the NYS Conference of Mayors are all eligible to participate in New
York's retirement system. Decades ago, these organizations applied for
(and were granted) this special privilege. Consequently, the state's
public retirement system includes certain private-sector employees
that enjoy a special benefit that other similarly situated private
sector employees do not have. A particularly troubling aspect of this
arrangement is that, in some cases, the officers and employees of
these private organizations are actually registered lobbyists.
Ultimately, the state pensions for these individuals increases costs
for state and local government - costs that are ultimately borne by
New York residents. It is outrageous and unfair to require New York
residents to pay the costs of a public pension for private sector
Another particularly irksome aspect of this situation is that these
groups regularly lobby New York state government officials to reduce
the high costs of pensions for local governments - the very costs that
their officers and employees are contributing to through the special
privilege they are taking advantage of. In fact, the NYS Association
of Counties, The NYS Conference of Mayors and the NYS Schools Boards
Association have all had pension reform on their lobbying agenda.
To be sure, the NYS retirement system is large and costs a lot of
money. There are many, many hard-working public employees that deserve
a public pension -- and a pension system should be maintained for
these individuals. However, the fact that the current system provides
a public pension to private-sector lobbying organizations demands a
fix This bill does just that.
BILL HISTORY: New Bill
FISCAL IMPLICATIONS: This bill will reduce the number of individuals
eligible for the NYS retirement system and will reduce additional
service credit for certain individuals already in the retirement
system. Therefore, pension costs for NYS and for local governments
will be reduced.
EFFECTIVE DATE: Immediately.
S T A T E O F N E W Y O R K
2013-2014 Regular Sessions
I N A S S E M B L Y
October 24, 2013
Introduced by M. of A. RYAN -- read once and referred to the Committee
on Governmental Employees
AN ACT to amend the retirement and social security law, in relation to
participation by public or quasi-public organizations in the retire-
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
1 Section 1. Subdivision a of section 31 of the retirement and social
2 security law, as amended by chapter 379 of the laws of 1989, is amended
3 to read as follows:
4 a. Any public or quasi-public organization created wholly or partly or
5 deriving its powers by the legislature of the state and which organiza-
6 tion employs persons engaged in service to the public or any state agen-
7 cy as defined in section fifty-three-a of the state finance law, or the
8 New York state association of town superintendents of highways, inc. or
9 any school board association, by resolution legally adopted by its
10 governing body and approved by the comptroller, may elect to have its
11 officers and employees become eligible to participate in the retirement
12 system. Acceptance of the officers and employees of such an employer
13 for membership in the retirement system shall be optional with the comp-
14 troller. If he shall approve their participation, such organization,
15 except as specifically provided in this article to the contrary, shall
16 thereafter be treated as a participating employer. Any election made
17 pursuant to this subdivision by a school board association shall be
18 applicable to current employees of such association. NOTWITHSTANDING
19 THE FOREGOING PROVISIONS, ANY OFFICER OR EMPLOYEE OF THE NEW YORK STATE
20 ASSOCIATION OF TOWN SUPERINTENDENTS OF HIGHWAYS, INC., THE NEW YORK
21 STATE SCHOOL BOARDS ASSOCIATION, THE NEW YORK STATE ASSOCIATION OF COUN-
22 TIES, THE ASSOCIATION OF TOWNS OF THE STATE OF NEW YORK, THE NEW YORK
23 CONFERENCE OF MAYORS AND OTHER MUNICIPAL OFFICIALS, OR ANY SCHOOL BOARD
24 ASSOCIATION, FIRST EMPLOYED ON OR AFTER THE EFFECTIVE DATE OF THE CHAP-
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
A. 8212 2
1 TER OF THE LAWS OF TWO THOUSAND FOURTEEN WHICH AMENDED THIS SUBDIVISION,
2 SHALL NOT BE ELIGIBLE TO PARTICIPATE IN THE RETIREMENT SYSTEM.
3 S 2. This act shall take effect immediately.
FISCAL NOTE.--This bill would require that persons first employed by
the following associations on or after the effective date will not be
eligible to membership in the New York State and Local Employees'
The New York state association of town superintendents of highways,
The New York state school board association,
The New York state association counties,
The association of towns of the state of New York,
The New York conference of mayors and other municipal officials, and
Any school board association.
If this bill is enacted, there will be no cost to the retirement
Summary of relevant resources:
The membership data used in measuring the impact of the proposed
change was the same as that used in the March 31, 2013 actuarial valu-
ation. Distributions and other statistics can be found in the 2013
Report of the Actuary and the 2013 Comprehensive Annual Financial Report
when released in the fall of 2013.
The actuarial assumptions and methods used are described in the 2010,
2011, 2012 and 2013 Annual Report to the Comptroller on Actuarial
Assumptions, and the Codes Rules and Regulations of the State of New
York: Audit and Control.
The Market Assets and GASB Disclosures are found in the March 31, 2013
New York State and Local Retirement System Financial Statements and
I am a member of the American Academy of Actuaries and meet the Quali-
fication Standards to render the statement of actuarial opinion
This estimate, dated September 3, 2013, and intended for use only
during the 2014 Legislative Session, is Fiscal Note No. 2014-7, prepared
by the Actuary for the New York State and Local Employees' Retirement