Allows retired employees of the New York state teachers' retirement system who return to active service and suspend their pension benefit to elect to combine their service credit earned prior to retirement with the service credit earned after their restoration to active service, provided they have earned at least two years of service credit since such restoration.
STATE OF NEW YORK
________________________________________________________________________
7462--B
2023-2024 Regular Sessions
IN SENATE
May 30, 2023
___________
Introduced by Sens. RYAN, CHU -- (at request of the New York State
Teachers' Retirement System) -- read twice and ordered printed, and
when printed to be committed to the Committee on Civil Service and
Pensions -- recommitted to the Committee on Civil Service and Pensions
in accordance with Senate Rule 6, sec. 8 -- committee discharged, bill
amended, ordered reprinted as amended and recommitted to said commit-
tee -- reported favorably from said committee and committed to the
Committee on Finance -- committee discharged, bill amended, ordered
reprinted as amended and recommitted to said committee
AN ACT to amend the education law, in relation to allowing retirees of
the New York state teachers' retirement system who suspend their
retirement the option of a benefit recalculation after two years of
service
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Subdivision 11 of section 503 of the education law, as
2 added by chapter 507 of the laws of 1972 and as renumbered by chapter
3 512 of the laws of 1976, is amended to read as follows:
4 11. a. If a retired member, receiving a retirement allowance for other
5 than disability, returns to active public service, except as otherwise
6 provided in sections two hundred eleven or two [hyndred] hundred twelve
7 of the retirement and social security law, and is eligible for member-
8 ship in the retirement system, [he thereupon] such employee shall become
9 a member and [his] their retirement allowance shall be suspended in the
10 same manner as provided in subdivision five of this section [five
11 hundred three of this article. In such event, he shall contribute to the
12 retirement system as if he were a new member]. Upon [his] subsequent
13 retirement [after at least two years of service he] such employee shall:
14 1. Be credited with all member service earned [by him] since [he] they
15 last became a member of the retirement system, and
16 2. Receive a retirement allowance which shall consist of[:
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD11631-03-4
S. 7462--B 2
1 (a) An annuity as provided in subdivision five of section five hundred
2 three of this article plus an annuity which is the actuarial equivalent
3 of any contributions made by him since he last became a member, and
4 (b) The] the pension which [he] such employee was receiving immediate-
5 ly prior to [his] the last restoration to membership as provided in
6 subdivision five of this section [five hundred three of this article],
7 plus a pension based upon the [member] service credit earned [by him]
8 since [he] such employee last became a member. Such latter pension shall
9 be computed as if [he] they were a new member when [he] they rejoined
10 the system pursuant to the provisions of this subdivision.
11 b. Where such member shall have earned at least [five] two years of
12 [member] service credit after restoration to active service, the total
13 service credit to which [he] such member was entitled at the time of
14 [his] the earlier retirement may, at [his] their option, again be cred-
15 ited to [him] them and upon [his] subsequent retirement [he] such member
16 shall be credited in addition for purposes of computation of the pension
17 portion of the retirement allowance with all [member] service credit
18 earned [by him] subsequent to [his] the last restoration to membership.
19 Such total service credit to which [he] such member was entitled at the
20 time of [his] the earlier retirement shall be so credited only in the
21 event that such member returns to the retirement system with regular
22 interest the actuarial equivalent of the amount of the pension [he]
23 received, or in the event that such amount is not so repaid the actuari-
24 al equivalent thereof shall be deducted from [his] such member's subse-
25 quent retirement allowance.
26 c. Notwithstanding the foregoing provisions of this subdivision, a
27 retired member who is receiving a retirement allowance for other than
28 physical disability, and who returns to active public service, may elect
29 not to be restored to membership in the retirement system until [he]
30 such retired member has rendered one year of service following [his]
31 their return to public service. In such event [his] the retirement
32 allowance shall be suspended during such year of service in the same
33 manner as provided in subdivision five of this section [five hundred
34 three of this article]. Upon restoration to membership following
35 completion of such year of service, [his] service in such year shall be
36 deemed to be service while a member for purposes of subdivision b of
37 section five hundred twelve of this article. [He] Such retired member
38 may purchase [member] service credit for such year, which shall be
39 deemed earned [member] service credit. If a retired member receiving a
40 retirement benefit allowance for other than physical disability, returns
41 to active public service, and is then ineligible for membership in the
42 retirement system, the retirement allowance shall be suspended in the
43 same manner as provided in this section.
44 d. Notwithstanding any other provision of this article, a retired
45 member who rejoins the system under the provisions of [paragraphs a or c
46 of] this subdivision shall only be entitled to a death benefit according
47 to the provisions of paragraph two of subdivision b of section five
48 hundred twelve of this article and of no other subdivision thereof and
49 for the purposes of [said] such paragraph two of subdivision b of
50 section five hundred twelve the credited service as a teacher shall be
51 service as a teacher credited since last joining the system.
52 § 2. This act shall take effect on the sixtieth day after it shall
53 have become a law.
FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
This bill would amend subdivision 11 of Section 503 of the Education
Law to allow a retired member of the New York State Teachers' Retirement
S. 7462--B 3
System (NYSTRS), who returns to active service and suspends their
pension benefit, to elect to combine their service credit earned prior
to their retirement with the service credit earned after their restora-
tion to active service, provided they have earned at least two years of
service credit since restoration and they pay back their prior pension
received or have the new benefit reduced for life based upon the actuar-
ial equivalent of the prior pension received. Current law requires five
years of service credit since restoration to combine all service credit
into one pension benefit. State employees and other members of the New
York State and Local Retirement System (NYS&LRS) are eligible to combine
their service credit after earning two years of service credit after
restoration. This bill would make this eligibility the same for teachers
as it is for state employees. This bill would take effect on the sixti-
eth day after it shall become a law.
The annual cost to the employers of members of the New York State
Teachers' Retirement System would be negligible if this bill is enacted.
Member data is from the System's most recent actuarial valuation
files, consisting of data provided by the employers to the Retirement
System. Data distributions and statistics can be found in the System's
Annual Report. System assets are as reported in the System's financial
statements and can also be found in the System's Annual Report. Actuar-
ial assumptions and methods are provided in the System's Actuarial Valu-
ation Report.
The source of this estimate is Fiscal Note 2024-2 dated October 16,
2023 prepared by the Actuary of the New York State Teachers' Retirement
System and is intended for use only during the 2024 Legislation Session.
I, Richard A. Young, am the Chief Actuary for the New York State Teach-
er's Retirement System. I am a member of the American Academy of Actuar-
ies and I met the Qualification Standards of the American Academy of
Actuaries to render the actuarial opinion contained herein.
