Provides for beneficiaries of the death benefits of an eligible uniformed member of the fire department of the city of New York the ability to elect to receive such benefits in a certain lump-sum amount.
STATE OF NEW YORK
________________________________________________________________________
7899
2025-2026 Regular Sessions
IN ASSEMBLY
April 11, 2025
___________
Introduced by M. of A. PHEFFER AMATO -- read once and referred to the
Committee on Governmental Employees
AN ACT to amend the retirement and social security law, in relation to
death benefits for members of the uniformed force of the fire depart-
ment of the city of New York
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Subdivision b of section 508 of the retirement and social
2 security law, as amended by chapter 476 of the laws of 2018, is amended
3 to read as follows:
4 b. 1. A member of a retirement system subject to the provisions of
5 this article who is a police officer, firefighter, correction officer,
6 investigator revised plan member or sanitation worker and is in a plan
7 which permits immediate retirement upon completion of a specified period
8 of service without regard to age or who is subject to the provisions of
9 section five hundred four or five hundred five of this article, shall
10 upon completion of ninety days of service be covered for financial
11 protection in the event of death in service pursuant to this subdivi-
12 sion.
13 2. Such death benefit shall be equal to three times the member's sala-
14 ry raised to the next highest multiple of one thousand dollars, but in
15 no event shall it exceed three times the maximum salary specified in
16 section one hundred thirty of the civil service law or, in the case of a
17 member of a retirement system other than the New York city employees'
18 retirement system, or in the case of a member of the New York city
19 employees' retirement system who is a New York city uniformed
20 correction/sanitation revised plan member or an investigator revised
21 plan member, the specific limitations specified for age of entrance into
22 service contained in subparagraphs (b), (c), (d), (e) and (f) of para-
23 graph two of subdivision a of this section.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD10891-02-5
A. 7899 2
1 3. (a) Provided further, notwithstanding any other provision of this
2 article to the contrary, where a member is in the uniformed force of the
3 fire department of the city of New York, including all enhanced plan
4 members, and would have been entitled to either a normal service retire-
5 ment benefit or early service retirement benefit at the time of such
6 member's death, as defined in section five hundred five of this article,
7 and where such member's death occurs on or after July first, two thou-
8 sand twenty-five, the beneficiary or beneficiaries may elect to receive,
9 in a lump sum, in lieu of any other lesser benefit, an amount payable
10 which shall be equal to the pension reserve inclusive of the member's
11 contributions plus interest, that would have been established had the
12 member retired on the date of such member's death, or the value of the
13 death benefit, whichever is greater.
14 (b) A member, or on the death of such member, a person nominated by
15 such member to receive their death benefit, may provide, by written
16 designation, duly executed and filed with the administrative head of
17 such retirement system, that such death benefit and the pension reserve
18 inclusive of the member's contributions, shall be paid in the form of an
19 annuity. Such designation shall be filed prior to or within ninety days
20 after the death of the member. The amount of such annuity shall be
21 determined as the actuarial equivalent of such death benefit and reserve
22 on the basis of the age of such beneficiary at the time of the member's
23 death. For purposes of this subdivision, the mortality and interest
24 rates used in determining this annuity shall be the rates in effect on
25 the date of the death of such member.
26 § 2. This act shall take effect immediately.
FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
SUMMARY: This proposed legislation would provide an alternative death
benefit for Tier 3 members of the New York City Fire Pension Fund (FIRE)
who die on or after July 1, 2025.
EXPECTED INCREASE (DECREASE) IN EMPLOYER CONTRIBUTIONS
by Fiscal Year for the first 25 years ($ in Millions)
Year FIRE
2026 0.5
2027 0.5
2028 0.5
2029 0.5
2030 0.6
2031 0.6
2032 0.6
2033 0.7
2034 0.7
2035 0.7
2036 0.8
2037 0.8
2038 0.8
2039 0.9
2040 0.9
2041 0.9
2042 1.0
2043 0.8
2044 0.8
2045 0.8
2046 0.9
2047 0.9
A. 7899 3
2048 0.9
2049 0.9
2050 0.9
Projected contributions include future new hires that may be impacted.
For Fiscal Year 2051 and beyond, the expected increase in normal cost as
a level percent of pay for impacted new entrants is approximately 0.02%.
The increase in employer contributions will be allocated to New York
City.
PRESENT VALUE OF BENEFITS: The Present Value of Benefits is the
discounted expected value of benefits paid to current members if all
assumptions are met, including future service accrual and pay increases.
Future new hires are not included in this present value.
INITIAL INCREASE (DECREASE) IN ACTUARIAL PRESENT VALUES
as of June 30, 2024 ($ in Millions)
Present Value (PV) FIRE
(1) PV of Employer Contributions: 6.0
(2) PV of Employee Contributions: 0.0
Total PV of Benefits (1) + (2): 6.0
UNFUNDED ACCRUED LIABILITY (UAL): Actuarial Accrued Liabilities are
the portion of the Present Value of Benefits allocated to past service.
Changes in UAL were amortized over the expected remaining working life-
time of those impacted using level dollar payments.
AMORTIZATION OF UNFUNDED ACCRUED LIABILITY
FIRE
Increase (Decrease) in UAL: 1.7 M
Number of Payments: 17
Amortization Payment: 0.2 M
CENSUS DATA: The estimates presented herein are based on preliminary
census data collected as of June 30, 2024. The census data for the
impacted population is summarized below.
FIRE
Active Members
- Number Count: 5,572
- Average Age: 34.1
- Average Service: 6.2
- Average Salary: 118,600
IMPACT ON MEMBER BENEFITS: Currently, Tier 3 FIRE members are general-
ly entitled to a lump sum ordinary death benefit equal to three times
salary plus the return of member accumulated contributions.
Under the proposed legislation, the ordinary death benefit for Tier 3
FIRE members who are otherwise eligible to receive an early retirement
or service retirement benefit would be the greater of their current
death benefit or the value of the pension reserve that would have been
established had they retired on the date of their death.
The pension reserve is the actuarial present value of all pension
payments expected to be made had the member retired. This type of lump
sum pension reserve death benefit is sometimes referred to as a Death
Gamble, and is afforded, in a similar form, to Tier 2 FIRE members.
A. 7899 4
The proposed legislation would further allow the ordinary death bene-
fit for Tier 3 FIRE members to be annuitized over the life of the bene-
ficiary, in an actuarially equivalent manner.
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 reflect any chapter
laws that may have been enacted during the current legislative session.
Ordinary death benefits which would be payable in the event of the
death of a non-finalized pensioner are not included in determining the
costs of this Fiscal Note. To the extent that such non-finalized
pensioners benefit from this proposed legislation, the costs disclosed
in this Fiscal Note will be greater.
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
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 2025-37 dated March 31,
2025 was prepared by the Chief Actuary for the New York City Retirement
Systems and Pension Funds and is intended for use only during the 2025
Legislative Session.
