Relates to service retirement benefits for certain members of the New York city employees' retirement system; provides that for New York city uniformed correction/sanitation revised plan members of the New York city employees' retirement system, the service retirement benefit shall not be reduced by the primary social security retirement benefit commencing at age sixty-two.
STATE OF NEW YORK
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5678--A
2023-2024 Regular Sessions
IN ASSEMBLY
March 20, 2023
___________
Introduced by M. of A. PHEFFER AMATO -- read once and referred to the
Committee on Governmental Employees -- recommitted to the Committee on
Governmental Employees in accordance with Assembly Rule 3, sec. 2 --
committee discharged, bill amended, ordered reprinted as amended and
recommitted to said committee
AN ACT to amend the retirement and social security law, in relation to
service retirement benefits for certain members of the New York city
employees' retirement system
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 505 of the retirement and social security law, as
2 amended by chapter 18 of the laws of 2012, is amended to read as
3 follows:
4 § 505. Service retirement benefits; police/fire members, New York city
5 uniformed correction/sanitation revised plan members and investigator
6 revised plan members. a. The normal service retirement benefit for
7 police/fire members, New York city uniformed correction/sanitation
8 revised plan members and investigator revised plan members at normal
9 retirement age shall be a pension equal to fifty percent of final aver-
10 age salary, less fifty percent of the primary social security retirement
11 benefit commencing at age sixty-two, as provided in section five hundred
12 eleven of this article, except that for New York city uniformed
13 correction/sanitation revised plan members of the New York city employ-
14 ees' retirement system, the normal service retirement benefit shall not
15 be reduced by the primary social security retirement benefit commencing
16 at age sixty-two as provided in section five hundred eleven of this
17 article.
18 b. The early service retirement benefit for police/fire members, New
19 York city uniformed correction/sanitation revised plan members and
20 investigator revised plan members shall be a pension equal to two and
21 one-tenths percent of final average salary times years of credited
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD08386-03-4
A. 5678--A 2
1 service at the completion of twenty years of service or upon attainment
2 of age sixty-two, increased by one-third of one percent of final average
3 salary for each month of service in excess of twenty years, but not in
4 excess of fifty percent of final average salary, less fifty percent of
5 the primary social security retirement benefit commencing at age sixty-
6 two as provided in section five hundred eleven of this article,
7 provided, however, that New York city police/fire revised plan members,
8 New York city uniformed correction/sanitation revised plan members and
9 investigator revised plan members shall not be eligible to retire for
10 service prior to the attainment of twenty years of credited service, and
11 provided further that for New York city uniformed correction/sanitation
12 revised plan members of the New York city employees' retirement system,
13 the early service retirement benefit shall not be reduced by the primary
14 social security retirement benefit commencing at age sixty-two as
15 provided in section five hundred eleven of this article.
16 c. A police/fire member, a New York city uniformed
17 correction/sanitation revised plan member or an investigator revised
18 plan member who retires with twenty-two years of credited service or
19 less may become eligible for annual escalation of the service retirement
20 benefit if he elects to have the payment of his benefit commence on the
21 date he would have completed twenty-two years and one month or more of
22 service. In such event, the service retirement benefit shall equal two
23 percent of final average salary for each year of credited service, less
24 fifty percent of the primary social security retirement benefit commenc-
25 ing at age sixty-two as provided in section five hundred eleven of this
26 article, except that for New York city uniformed correction/sanitation
27 revised plan members of the New York city employees' retirement system,
28 the service retirement benefit shall not be reduced by the primary
29 social security retirement benefit commencing at age sixty-two as
30 provided in section five hundred eleven of this article.
31 § 2. Section 511 of the retirement and social security law is amended
32 by adding a new subdivision h to read as follows:
33 h. This section shall not apply to New York city uniformed
34 correction/sanitation revised plan members of the New York city employ-
35 ees' retirement system who receive a service retirement benefit pursuant
36 to section five hundred five of this article or a deferred vested bene-
37 fit pursuant to section five hundred sixteen of this article.
38 § 3. Subdivision c of section 516 of the retirement and social securi-
39 ty law, as amended by chapter 18 of the laws of 2012, is amended to read
40 as follows:
41 c. The deferred vested benefit of police/fire members, New York city
42 police/fire revised plan members, New York city uniformed
43 correction/sanitation revised plan members or investigator revised plan
44 members shall be a pension commencing at early retirement age equal to
45 two and one-tenths percent of final average salary times years of cred-
46 ited service, less fifty percent of the primary social security retire-
47 ment benefit commencing at age sixty-two, as provided in section five
48 hundred eleven of this article, except that for New York city uniformed
49 correction/sanitation revised plan members of the New York city employ-
50 ees' retirement system, the service retirement benefit shall not be
51 reduced by the primary social security retirement benefit commencing at
52 age sixty-two as provided in section five hundred eleven of this
53 article. A police/fire member, a New York city police/fire revised plan
54 member, a New York city uniformed correction/sanitation revised plan
55 member or investigator revised plan member may elect to receive his
56 vested benefit commencing at early retirement age or age fifty-five. If
A. 5678--A 3
1 the vested benefit commences before early retirement age, the benefit
2 shall be reduced by one-fifteenth for each year, if any, that the
3 member's early retirement age is in excess of age sixty, and by one-
4 thirtieth for each additional year by which the vested benefit commences
5 prior to early retirement age. If such vested benefit is deferred until
6 after such member's normal retirement age, the benefit shall be computed
7 and subject to annual escalation in the same manner as provided for an
8 early retirement benefit pursuant to subdivision c of section five
9 hundred five of this article.
10 § 4. This act shall take effect on the sixtieth day after it shall
11 have become a law.
FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
SUMMARY: This proposed legislation would amend Sections of the Retire-
ment and Social Security Law (RSSL) to eliminate the offset equal to 50%
of the primary social security benefit in the service, early service,
and vested retirement benefits for certain Tier 3 Sanitation and
Correction members of NYCERS.
EXPECTED INCREASE (DECREASE) IN EMPLOYER CONTRIBUTIONS
by Fiscal Year for the first 25 years ($ in Millions)
Year NYCERS
2025 32.3
2026 34.3
2027 37.0
2028 40.0
2029 43.2
2030 46.4
2031 49.5
2032 52.1
2033 54.9
2034 57.9
2035 60.7
2036 63.3
2037 65.9
2038 68.6
2039 71.3
2040 73.8
2041 62.5
2042 65.0
2043 67.6
2044 70.4
2045 73.1
2046 75.9
2047 78.6
2048 81.3
2049 84.2
Employer Contribution impact beyond Fiscal Year 2049 is not shown.
Projected contributions include future new hires that may be impacted.
The entire increase in employer contributions will be allocated to New
York City.
EXPECTED INCREASE (DECREASE) IN ACTUARIAL LIABILITIES
as of June 30, 2023 ($ in Millions)
Present Value (PV) NYCERS
PV of Benefits: 366.8
A. 5678--A 4
PV of Employee Contributions: 0.0
PV of Employer Contributions: 366.8
Unfunded Accrued Liabilities: 127.1
AMORTIZATION OF UNFUNDED ACCRUED LIABILITY
NYCERS
Number of Payments: 16
Fiscal Year of Last Payment: 2040
Amortization Payment: 13.9M
Unfunded Accrued Liability increases were amortized over the expected
remaining working lifetime of those impacted by the benefit changes
using level dollar payments.
CENSUS DATA: The estimates presented herein are based on preliminary
census data collected as of June 30, 2023. The census data for the
impacted population is summarized below.
NYCERS
Active Members
- Number Count: 7,415
- Average Age: 39.2
- Average Service: 6.7
- Average Salary: 100,200
Term. Vested Members
- Number Count: 589
- Average Age: 38.7
IMPACT ON MEMBER BENEFITS: Currently, Tier 3 normal service retire-
ment, early service retirement, and vested retirement benefits for Sani-
tation and Correction members in 22-Year Plans are subject to an offset
equal to 50% of the primary social security benefit as defined in RSSL
Section 511 beginning at age 62.
Under the proposed legislation, the offset for such benefits would be
eliminated resulting in an increase in benefits.
ASSUMPTIONS AND METHODS: The estimates presented herein have been
calculated based on the Revised 2021 Actuarial Assumptions and Methods
of the impacted retirement systems. In addition:
* New entrants were assumed to replace exiting members so that total
payroll increases by 3% each year for impacted groups. New entrant demo-
graphics were developed based on data for recent new hires and actuarial
judgement.
RISK AND UNCERTAINTY: The costs presented in this Fiscal Note depend
highly on the actuarial assumptions, methods, and models used, demo-
graphics of the impacted population, and other factors such as invest-
ment, contribution, and other risks. If actual experience deviates from
actuarial assumptions, the actual costs could differ from those
presented herein. Quantifying these risks is beyond the scope of this
Fiscal Note.
This Fiscal Note is intended to measure pension-related impacts and
does not include other potential costs (e.g., administrative and Other
Postemployment Benefits).
This Fiscal Note does not include cost analyses relating to provisions
contained in RSSL Section 500(c).
STATEMENT OF ACTUARIAL OPINION: Marek Tyszkiewicz and Gregory Zelikov-
sky are members of the Society of Actuaries and the American Academy of
Actuaries. We are members of NYCERS but do not believe it impairs our
A. 5678--A 5
objectivity and we meet the Qualification Standards of the American
Academy of Actuaries to render the actuarial opinion contained herein.
To the best of our knowledge, the results contained herein have been
prepared in accordance with generally accepted actuarial principles and
procedures and with the Actuarial Standards of Practice issued by the
Actuarial Standards Board.
FISCAL NOTE IDENTIFICATION: This Fiscal Note 2024-08 dated January 25,
2024 was prepared by the Chief Actuary for the New York City Retirement
Systems and Pension Funds. This estimate is intended for use only during
the 2024 Legislative Session.
