Add SS99-t & 99-u, St Fin L; add Art 23 SS1300 - 1304; R & SS L
Establishes a taxpayer abuse sanction to be imposed against the income of a public officer who commits certain felonies related to his or her service as a public officer.
STATE OF NEW YORK
________________________________________________________________________
2333
2011-2012 Regular Sessions
IN SENATE
January 18, 2011
___________
Introduced by Sen. KRUEGER -- read twice and ordered printed, and when
printed to be committed to the Committee on Civil Service and Pensions
AN ACT to amend the retirement and social security law and the state
finance law, in relation to pension forfeiture and taxpayer abuse
sanctions
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 article 23 to read as follows:
3 ARTICLE 23
4 PENSION FORFEITURE FOR PUBLIC CORRUPTION ACT
5 Section 1300. Short title.
6 1301. Definitions.
7 1302. Pension forfeiture.
8 1303. Taxpayer abuse sanction.
9 1304. Miscellaneous.
10 § 1300. Short title. This article shall be known and may be cited as
11 the "pension forfeiture for public corruption act".
12 § 1301. Definitions. The following words and phrases, as used in this
13 article, shall have the following meanings, unless a different meaning
14 is plainly required by the context:
15 1. "Defendant" shall mean a person against whom a forfeiture action is
16 commenced.
17 2. "Designated felony offense" shall mean:
18 (a) any felony offense set forth in the penal law; or
19 (b) a conspiracy to commit any felony offense set forth in the penal
20 law when the commission of any such felony is related to the performance
21 or failure to perform such member or retired member's official duties
22 and responsibilities.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD06940-02-1
S. 2333 2
1 3. "Comptroller" shall mean the comptroller of the state of New York
2 in his or her capacity as administrative head of the New York state and
3 local employees' retirement system and the New York state and local
4 police and fire retirement system.
5 4. "Member" shall mean a member of the New York state and local
6 employees' retirement system, the New York state and local police and
7 fire retirement system, the New York state teachers' retirement system,
8 the New York city employees' retirement system, the New York city teach-
9 ers' retirement system, the New York city police pension fund, the New
10 York city fire department pension fund, the New York city board of
11 education retirement system and any other retirement system of the state
12 or city of New York.
13 5. "Retired member" shall mean a person who is retired from and who is
14 receiving a retirement allowance from a retirement system.
15 6. "Retirement system" shall mean the New York state and local employ-
16 ees' retirement system, the New York state policemen's and firemen's
17 retirement system, the New York state teachers' retirement system, the
18 New York city employees' retirement system, the New York city teachers'
19 retirement system, the New York city police pension fund, the New York
20 city fire department pension fund, the New York city board of education
21 retirement system and any other retirement system of the state or city
22 of New York.
23 7. "Aggrieved party" shall mean any resident taxpayer who is adversely
24 affected by any designated felony offense committed by a member or
25 retired member of any retirement system of the state of New York as
26 defined in subdivision six of this section.
27 § 1302. Pension forfeiture. Notwithstanding any other provision of
28 general, special or local law, rule or regulation to the contrary:
29 1. In the case of a member or retired member who is convicted of any
30 designated felony offense, the commission of which is related to the
31 performance or failure to perform such member or retired member's offi-
32 cial duties and responsibilities, an action may be commenced in the
33 supreme court by the district attorney having jurisdiction over the
34 offense or any aggrieved party, for the forfeiture of all or a portion
35 of those rights and benefits to which such person is or will be entitled
36 as a member or retired member provided that any contributions made by
37 the official to his or her retirement system shall not be subject to
38 forfeiture, but shall be returned to such official. Such action shall
39 be commenced within one year of such conviction. For purposes of this
40 article, a designated felony offense is related to the performance or
41 failure to perform such member or retired member's official duties and
42 responsibilities if it:
43 (a) constituted a material violation of such member or retired
44 member's duties and responsibilities as a public servant; or
45 (b) even though committed outside the scope of such member's official
46 duties or responsibilities, involved actions or conduct by which such
47 member or retired member indicated or conveyed that he or she was acting
48 with the authority of, or under color of the authority of, any govern-
49 mental entity.
50 2. Where the attorney general finds that a member or a retired member
51 has been convicted of a designated felony offense, the commission of
52 which is related to the performance or failure to perform such member or
53 retired member's official duties and responsibilities, an action may be
54 commenced in the supreme court by the attorney general or any aggrieved
55 party, for the forfeiture of all or a portion of those rights and bene-
56 fits to which such person is or will be entitled as a member or retired
S. 2333 3
1 member. Such action shall be commenced within one year of such
2 conviction.
3 3. Prior to the commencement of such action as described in subdivi-
4 sion one or two of this section, the district attorney or the attorney
5 general, as the case may be, shall provide notice to the comptroller
6 stating that he or she has reason to believe that the person convicted
7 committed the felony related to his or her official duties and responsi-
8 bilities. Within twenty days of receipt of such notice, the comptroller
9 shall submit a notice of applicability to the district attorney or the
10 attorney general as the case may be. The notice of applicability shall
11 contain a statement specifying whether the person convicted is or has
12 been a member or retired member of the New York state and local employ-
13 ees' retirement system or the New York state and local police and fire
14 retirement system and shall describe the rights and benefits to which
15 such person is or will be entitled to from such public retirement
16 system.
17 4. Upon motion by the district attorney or the attorney general, as
18 the case may be, made upon commencement of or at any time during the
19 pendency of a forfeiture action, pursuant to the procedure set forth in
20 subdivision one of section sixty-three hundred eleven or section sixty-
21 three hundred thirteen of the civil practice law and rules, the court
22 may issue a temporary restraining order or a preliminary injunction
23 prohibiting the defendant from receiving any rights or benefits from the
24 appropriate retirement system. A preliminary injunction may be granted
25 where the court finds that there is a substantial probability that the
26 district attorney or attorney general will prevail on the issue of
27 forfeiture. No showing of irreparable harm shall be required. The court
28 may not consider on such motion any issues presented to the court which
29 heard the criminal action in which the defendant was convicted or which
30 arise out of such criminal action and may be presented on appeal.
31 5. All defendants in a forfeiture action brought pursuant to this
32 article shall have the right to trial by jury on any issue of fact.
33 6. The burden of proof shall be upon the district attorney or the
34 attorney general, as the case may be, to prove by clear and convincing
35 evidence the facts necessary to establish a claim of pension forfeiture.
36 7. (a) Upon a finding by the court that the defendant has committed a
37 felony in connection with his or her official duties and responsibil-
38 ities, the court shall issue an order to the appropriate retirement
39 system for:
40 (i) the forfeiture or recoupment of all or a portion of the defend-
41 ant's rights and benefits as a member or retired member of such system;
42 (ii) the recoupment of all or a portion of the retirement benefits
43 paid to the defendant; and
44 (iii) the refund to the defendant of any contributions made by the
45 defendant to the retirement system for any period for which the defend-
46 ant's rights and benefits as a member or retired member of such retire-
47 ment system have been ordered forfeited.
48 (b) All orders and findings made by the court pursuant to this section
49 shall be served upon the comptroller.
50 8. Upon a final determination that reverses or vacates the conviction
51 or convictions of a designated offense or offenses, the member or
52 retired member who has forfeited retirement rights and benefits pursuant
53 to this section shall have such rights and benefits retroactively
54 restored upon application to the court with jurisdiction over the
55 forfeiture action, regardless of any temporary restraining order or
56 preliminary injunction which may be outstanding or order which may have
S. 2333 4
1 been issued. Such court, upon finding that such a final determination
2 has occurred, shall issue an order retroactively restoring such rights
3 and benefits, together with such other relief deemed appropriate. As a
4 condition to full restoration of rights and benefits as provided in this
5 subdivision, the member or retired member shall reimburse the retirement
6 system for any contributions that were refunded to the member or retired
7 member pursuant to the provisions of paragraph (a) of subdivision seven
8 of this section.
9 9. Except as otherwise provided by this article, the civil practice
10 law and rules shall govern the procedure in actions commenced under this
11 article, except where the action is regulated by any inconsistent
12 provisions herein. In such actions, the court may not consider any
13 issues presented to the court which heard the criminal action in which
14 the defendant was convicted or which arise out of such criminal action
15 and may be presented on appeal.
16 § 1303. Taxpayer abuse sanction. 1. Upon an order issued pursuant to
17 subdivision seven of section thirteen hundred two of this article, the
18 comptroller shall impose a sanction in accordance with this section.
19 Such sanction shall be imposed for any taxable year during which such
20 member of a public retirement system of the state is eligible to receive
21 a pension benefit and shall be in an amount equal to the amount of any
22 such benefit received during such taxable year.
23 2. Monies received from sanctions imposed pursuant to this section
24 shall:
25 (a) for monies received from sanctions imposed for a conviction of a
26 person who is a member of the New York state teachers' retirement
27 system, the New York city teachers' retirement system or the New York
28 city board of education retirement system, be deposited in the education
29 taxpayer abuse penalty fund established pursuant to section
30 ninety-nine-t of the state finance law and distributed pursuant to the
31 provisions of such section; or
32 (b) for monies received from sanctions imposed for a conviction of a
33 person who is a member of the New York state employees' retirement
34 system, the New York state policemen's and firemen's retirement system,
35 the New York city employees' retirement system, the New York city police
36 pension fund, the New York city fire department pension fund, or any
37 other retirement system of the state or city of New York other than a
38 retirement system set forth in paragraph one of this subdivision, be
39 deposited in the taxpayer abuse penalty fund established pursuant to
40 section ninety-nine-u of the state finance law and distributed pursuant
41 to the provisions of such section.
42 § 1304. Miscellaneous. The remedies provided for in this article are
43 not intended to substitute for, limit or supersede the lawful authority
44 of any public officer, agency or other person to enforce any other right
45 or remedy provided for by law.
46 § 2. The state finance law is amended by adding two new sections 99-t
47 and 99-u to read as follows:
48 § 99-t. Education taxpayer abuse penalty fund. 1. There is hereby
49 established in the joint custody of the commissioner of taxation and
50 finance and the comptroller, a special fund to be known as the "educa-
51 tion taxpayer abuse penalty fund".
52 2. Such fund shall consist of all revenues received by the department
53 of taxation and finance, pursuant to the provisions of section thirteen
54 hundred three of the retirement and social security law and all other
55 moneys appropriated, credited, or transferred thereto from any other
56 fund or source pursuant to law. Nothing contained in this section shall
S. 2333 5
1 prevent the state from receiving grants, gifts or bequests for the
2 purposes of the fund as defined in this section and depositing them into
3 the fund according to law. Any interest received by the comptroller on
4 moneys on deposit in such fund shall be retained in and become part of
5 such fund.
6 3. Moneys in such fund shall be distributed to school districts in the
7 state where persons subject to the provisions of section thirteen
8 hundred three of the retirement and social security law were employed at
9 the time of the commission of the act or acts upon which such conviction
10 was based. The amount of moneys in the fund that shall be distributed to
11 a school district pursuant to this subdivision shall be equal to the
12 dollar amount of the sanction imposed upon such convicted person. Any
13 moneys received by the fund from a source other than a sanction imposed
14 pursuant to the provisions of section thirteen hundred three of the
15 retirement and social security law shall be distributed equally among
16 school districts located in the state.
17 4. Moneys shall be payable from the fund on the audit and warrant of
18 the state comptroller on vouchers approved and certified by the commis-
19 sioner of taxation and finance.
20 5. To the extent practicable, moneys of the fund shall be distributed
21 to school districts at least once annually.
22 § 99-u. Taxpayer abuse penalty fund. 1. There is hereby established in
23 the joint custody of the commissioner of taxation and finance and the
24 comptroller, a special fund to be known as the "taxpayer abuse penalty
25 fund".
26 2. Such fund shall consist of all revenues received by the department
27 of taxation and finance, pursuant to the provisions of section thirteen
28 hundred three of the retirement and social security law and all other
29 moneys appropriated, credited, or transferred thereto from any other
30 fund or source pursuant to law. Nothing contained in this section shall
31 prevent the state from receiving grants, gifts or bequests for the
32 purposes of the fund as defined in this section and depositing them into
33 the fund according to law. Any interest received by the comptroller on
34 moneys on deposit in such fund shall be retained in and become part of
35 such fund.
36 3. Moneys in such fund shall be distributed to political subdivisions
37 within the state where persons subject to the provisions of section
38 thirteen hundred three of the retirement and social security law were
39 employed at the time of the commission of the act or acts upon which
40 such conviction was based or to the state if such person was employed by
41 the state. The amount of moneys in the fund that shall be distributed
42 to a municipality or to the state pursuant to this subdivision shall be
43 equal to the dollar amount of the sanction imposed upon such convicted
44 person. Any moneys received by the fund from a source other than a sanc-
45 tion imposed pursuant to the provisions of section thirteen hundred
46 three of the retirement and social security law shall be distributed
47 equally among municipalities located in the state.
48 4. Moneys shall be payable from the fund on the audit and warrant of
49 the state comptroller on vouchers approved and certified by the commis-
50 sioner of taxation and finance.
51 5. To the extent practicable, moneys of the fund shall be distributed
52 to municipalities at least once annually.
53 § 3. Notwithstanding any provision of law to the contrary, any action
54 or claim brought pursuant to section 1302 of the retirement and social
55 security law, which is barred as of the effective date of this section
56 because the applicable period of limitation has expired is hereby
S. 2333 6
1 revived, and action thereon may be commenced provided that such action
2 is commenced within one year of the effective date of this section.
3 § 4. This act shall take effect immediately and shall apply to taxable
4 years beginning on or after January 1, 2011.
