STATE OF NEW YORK
________________________________________________________________________
6931--A
2015-2016 Regular Sessions
IN ASSEMBLY
April 10, 2015
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Introduced by M. of A. NOLAN, BUCHWALD, GALEF -- (at request of the New
York State Teachers' Retirement System) -- read once and referred to
the Committee on Education -- recommitted to the Committee on Educa-
tion 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 education law, in relation to a retirement contrib-
ution reserve fund for the purposes of the New York state teachers'
retirement system
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. The education law is amended by adding a new section 3653
2 to read as follows:
3 § 3653. Retirement contribution reserve fund. 1. The board of educa-
4 tion or trustees of a participating employer may, by resolution, estab-
5 lish a retirement contribution reserve fund for the purpose of offset-
6 ting employer contributions to the New York state teachers' retirement
7 system and payable pursuant to this chapter.
8 2. There may be paid into a retirement contribution reserve fund:
9 a. such amounts as may be provided therefor by budgetary appropriation
10 or raised by tax therefor;
11 b. such revenues as are not required by law to be paid into any other
12 fund or account;
13 c. such other funds as may be legally appropriated; and
14 d. notwithstanding any law to the contrary, such amounts as may be
15 transferred from a reserve fund established pursuant to section six-c,
16 six-d, six-e, six-f or six-g of the general municipal law comprised of
17 moneys raised from the same tax base as the moneys in the retirement
18 contribution reserve fund, or a reserve fund established pursuant to
19 section thirty-six hundred fifty-one of this article, provided that any
20 such transfer shall only be made by resolution of the board of education
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD09379-02-6
A. 6931--A 2
1 or trustees of such employer adopted after a public hearing held on at
2 least fifteen days prior published notice in at least one newspaper
3 having general circulation in the school district of the employer.
4 3. For purposes of this section:
5 a. "retirement contribution" shall mean all or any portion of the
6 employer contribution payable by a participating employer to the New
7 York state teachers' retirement system pursuant to article eleven of
8 this chapter; and
9 b. "employer" shall mean the state of New York, the city, the village,
10 school district board or trustee, or other agency of and within the
11 state by which a teacher is paid.
12 4. The moneys in the retirement contribution reserve fund shall be
13 deposited and secured in the manner provided by section ten of the
14 general municipal law. The board of education or trustees, or chief
15 administrative officer or his or her designee thereof if the board or
16 trustees shall delegate such duty to him or her, may invest the moneys
17 in such fund in the manner provided by section eleven of the general
18 municipal law. Any interest earned or capital gain realized on the money
19 so deposited or invested shall accrue to and become part of such fund.
20 5. The board of education or trustees of such employer may, by resol-
21 ution, authorize expenditures from the retirement contribution reserve
22 fund. Except as otherwise provided by law, moneys in a retirement
23 contribution reserve fund may only be expended to offset the employer
24 contributions payable in accordance with article eleven of this chapter.
25 6. The board of education or trustees of such employer may, by resol-
26 ution, authorize the transfer of a portion of the moneys in a retirement
27 contribution reserve fund to a reserve fund of the employer established
28 pursuant to section six-c, six-d, six-e, six-f or six-g of the general
29 municipal law comprised of moneys raised from the same tax base as the
30 moneys in the retirement contribution reserve fund, or a reserve fund
31 established pursuant to section thirty-six hundred fifty-one of this
32 article, provided, that any transfer shall only be made by resolution of
33 the board of education or trustees of such employer adopted after a
34 public hearing held on at least fifteen days prior published notice in
35 at least one newspaper having general circulation in the school district
36 of the employer.
37 7. The chief administrative officer, or his or her designee, of such
38 employer shall account for a retirement contribution reserve fund sepa-
39 rate and apart from all other funds of the employer. Such accounting
40 shall show: the source, date and amount of each sum paid into the fund;
41 the interest earned by such fund, capital gains or losses resulting from
42 the sale of investments of this fund; the order, purpose thereof, date
43 and amount of each payment from this fund; the assets of the fund, indi-
44 cating cash balance and a schedule of investments. The chief administra-
45 tive officer, or his or her designee, within sixty days after the close
46 of each fiscal year, shall furnish a detailed report of the operation
47 and condition of this fund to the board of education or trustees.
48 8. The members of the board of education or trustees of such employer
49 are hereby declared trustees of a retirement contribution reserve fund
50 and shall be subject to all the duties and responsibilities imposed by
51 law on trustees, and such duties and responsibilities may be enforced by
52 the employer, as the case may be, or by any officer or taxpayer thereof.
53 9. No member of the board of education or trustees of such employer
54 shall:
55 a. authorize a withdrawal from a retirement contribution reserve fund
56 for any purpose except as provided in this section; or
A. 6931--A 3
1 b. expend any money withdrawn from such fund for a purpose other than
2 as provided in this section.
3 Any member of the board of education or any trustee who violates the
4 provisions of this subdivision shall be guilty of a misdemeanor.
5 10. The board of education or trustees of such employer may, by resol-
6 ution, determine a retirement contribution reserve fund is no longer
7 needed and may terminate such fund. Such resolution shall transfer any
8 moneys remaining in such fund to one or more reserve funds of the
9 employer as established pursuant to section six-c, six-d, six-e, six-f
10 or six-g of the general municipal law comprised of moneys raised from
11 the same tax base as the moneys in the retirement contribution reserve
12 fund, or one or more reserve funds established pursuant to section thir-
13 ty-six hundred fifty-one of this chapter.
14 § 2. This act shall take effect on the first of July next succeeding
15 the date on which it shall have become a law.
FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
This bill would add a new Section 3653 to the Education Law to permit
the board of education or trustees of a participating employer of the
New York State Teachers' Retirement System (NYSTRS) to establish a
retirement contribution reserve fund for the purpose of offsetting
future required employer contributions. The money that may be paid into
a retirement contribution reserve fund shall consist of amounts provided
for by budgetary appropriation, revenues that are not required by law to
be paid into any other fund or account, such other funds as may be
legally appropriated, and transfers from other reserve funds.
The moneys in the retirement contribution reserve fund shall be depos-
ited and secured in the manner provided by Section 10 of the General
Municipal Law, and may be invested in the manner provided by Section 11
of the General Municipal Law. Any interest earned or capital gain real-
ized shall accrue to and become part of the retirement contribution
reserve fund.
Except as otherwise provided by law, the moneys in the retirement
contribution reserve fund may only be expended to offset required
employer contributions payable in accordance with Article 11 of the
Education Law.
This act shall take effect on the first day of July next succeeding
the date on which it shall have become a law.
It is estimated that there will be no annual cost to the employers of
members of the New York State Teachers' Retirement System if this bill
is enacted.
Employee 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
Comprehensive Annual Financial Report (CAFR). System assets are as
reported in the System's financial statements, and can also be found in
the CAFR. Actuarial assumptions and methods are provided in the
System's Actuarial Valuation Report.
The source of this estimate is Fiscal Note 2016-2 dated October 9,
2015 prepared by the Actuary of the New York State Teachers' Retirement
System and is intended for use only during the 2016 Legislative Session.
I, Richard A. Young, am the Actuary for the New York State Teachers'
Retirement System. I am a member of the American Academy of Actuaries
and I meet the Qualification Standards of the American Academy of Actu-
aries to render the actuarial opinion contained herein.
