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A07794 Summary:

BILL NOA07794
 
SAME ASSAME AS S05634
 
SPONSORSchiavoni
 
COSPNSR
 
MLTSPNSR
 
Add §31-g, R & SS L
 
Authorizes the participation by free association libraries in the New York state and local employees' retirement system.
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A07794 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          7794
 
                               2025-2026 Regular Sessions
 
                   IN ASSEMBLY
 
                                     April 11, 2025
                                       ___________
 
        Introduced  by  M.  of  A.  SCHIAVONI  --  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 free association libraries in the New York state and
          local employees' retirement system

          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
 
     1    Section 1. The retirement and social security law is amended by adding
     2  a new section 31-g to read as follows:
     3    §  31-g.  Participation  by free association libraries. A free associ-
     4  ation library as defined in  section  two  hundred  fifty-three  of  the
     5  education  law  and  which meets the criteria set forth in this section,
     6  may by resolution adopted as provided in section seven hundred eight  of
     7  the  not-for-profit corporation law by its board of trustees and subject
     8  to the approval of the comptroller, elect to participate in the  retire-
     9  ment  system.  Acceptance of its employees for membership in the retire-
    10  ment system shall be mandatory with the comptroller, who shall determine
    11  the amounts of contribution payable by such library and  its  employees,
    12  shall  resolve  questions  of credit for prior service, and shall in all
    13  other respects assure that such employees share the same  rights,  obli-
    14  gations  and  benefits as other members of the retirement system. A free
    15  association library shall be eligible  to  join  the  retirement  system
    16  under the following conditions:
    17    (a) such library shall be chartered by the state board of regents;
    18    (b)  such  library  shall serve the entire population of its chartered
    19  service area;
    20    (c) the board of trustees of such library  shall  be  elected  by  the
    21  voters of its chartered service area;
    22    (d) such library's budget shall be approved by the voters of its char-
    23  tered service area;
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD07542-02-5

        A. 7794                             2
 
     1    (e)  at  least fifty-one percent of such library's budget shall derive
     2  from public sources; and
     3    (f)  such library shall file the annual report with the comptroller as
     4  required of public libraries by section thirty of the general  municipal
     5  law.
     6    § 2. This act shall take effect immediately.
          FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
          This bill would permit any free association public library which meets
        certain  specific  criteria to elect participation in the New York State
        and Local Employees' Retirement System (NYSLERS).
          If this bill is enacted during the 2025 Legislative  Session,  and  an
        eligible  corporation  elects participation, the future annual cost will
        depend on the retirement plan adopted and the  billable  salary  of  the
        affected employees.
          The  expected  annual contributions of an electing corporation for the
        fiscal year ending March 31, 2026 are as follows:
 
                              Tier         Percent of Payroll
                                 1              12.5 to 25.2
                                 2              11.6 to 23.0
                           3 and 4                      19.3
                                 5                      16.3
                                 6                      12.6

          In addition to the annual contributions discussed above, there will be
        a deficiency cost to the electing corporation which will be payable  for
        a  25-year  period.  This  cost will depend on the age, service, salary,
        plan and tier of the affected employees.
          Internal Revenue Service (IRS) plan qualification  issues:  permitting
        participation  of  non-governmental employees in the NYSLERS could jeop-
        ardize the governmental plan  status  of  the  Retirement  System  ("the
        System") and its exemption from the Employees Retirement Income Security
        Act  (ERISA).  This  development  could  result in the loss of qualified
        status, which would mean the loss of tax  benefits.  This  result  would
        substantially  impair  the  System's  value to the more than one million
        participants.
          Prior to the enactment of this legislation, we recommend that a favor-
        able ruling be obtained from the IRS stating that these provisions would
        not harm the qualification status of the System. It  is  estimated  that
        the  costs  to obtain such a ruling would be $38,000 for the services of
        the IRS, and $1,000 per hour for legal consultants.
          Summary of relevant resources:
          Membership data as of March 31, 2024 was used in measuring the  impact
        of the proposed change, the same data used in the April 1, 2024 actuari-
        al  valuation.  Distributions  and  other statistics can be found in the
        2024 Report of the Actuary and the 2024 Annual  Comprehensive  Financial
        Report.  The actuarial assumptions and methods used are described in the
        2024  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, 2024 New York State and Local Retirement System Financial Statements
        and Supplementary Information.
          This fiscal note does not constitute a legal opinion on the  viability
        of  the  proposed change nor is it intended to serve as a substitute for
        the professional judgment of an attorney.

        A. 7794                             3
 
          This estimate, dated February 24, 2025,  and  intended  for  use  only
        during  the  2025  Legislative  Session,  is Fiscal Note No. 2025-67. As
        Chief Actuary of the New York State  and  Local  Retirement  System,  I,
        Aaron  Schottin  Young,  hereby certify that this analysis complies with
        applicable  Actuarial  Standards  of  Practice  as  well  as the Code of
        Professional Conduct and Qualification Standards for  Actuaries  Issuing
        Statements of Actuarial Opinion of the American Academy of Actuaries, of
        which I am a member.
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