Relates to rate of regular interest used in the actuarial valuation of liabilities for calculating contributions to the NYC employees' retirement system.
STATE OF NEW YORK
________________________________________________________________________
5918
2009-2010 Regular Sessions
IN SENATE
June 18, 2009
___________
Introduced by Sen. SAVINO -- read twice and ordered printed, and when
printed to be committed to the Committee on Rules
AN ACT to amend the administrative code of the city of New York, in
relation to the rate of regular interest used in the actuarial valu-
ation of liabilities for the purpose of calculating contributions to
the New York city employees' retirement system, the New York city
teachers' retirement system, the police pension fund, subchapter two,
the fire department pension fund, subchapter two and the board of
education retirement system of such city by public employers and other
obligers required to make employer contributions to such retirement
systems, and the crediting of special interest and additional interest
to members of such retirement systems, and the allowance of supplemen-
tary interest on the funds of such retirement systems
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Paragraph 2 of subdivision b of section 13-638.2 of the
2 administrative code of the city of New York, as amended by chapter 152
3 of the laws of 2006, is amended to read as follows:
4 (2) With respect to each retirement system, such rate of interest
5 shall be as hereinafter set forth in this paragraph:
6 First day and
7 last day of
8 Rate of interest fiscal year or
9 per centum per series of fiscal
10 Retirement annum, compounded years for which
11 System annually rate is effective
12 ________________________________________________________________________
13 NYCERS 8% July 1, 2004 to
14 June 30, [2009] 2010
15 NYCTRS 8% July 1, 2004 to
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD14397-01-9
S. 5918 2
1 June 30, [2009] 2010
2 PPF 8% July 1, 2004 to
3 June 30, [2009] 2010
4 FPF 8% July 1, 2004 to
5 June 30, [2009] 2010
6 BERS 8% July 1, 2004 to
7 June 30, [2009] 2010
8 § 2. Paragraph 2 of subdivision f of section 13-638.2 of the adminis-
9 trative code of the city of New York, as amended by chapter 152 of the
10 laws of 2006, is amended to read as follows:
11 (2) Such special interest shall be allowed at the rates and for the
12 periods set forth below in this paragraph:
13 First day and
14 last day of
15 Rate of interest fiscal year or
16 per centum per series of fiscal
17 Retirement annum, compounded years for which
18 System annually rate is effective
19 ________________________________________________________________________
20 NYCERS 1 1/4% July 1, 2004 to
21 June 30, [2009] 2010
22 NYCTRS 1 1/4% July 1, 2004 to
23 June 30, [2009] 2010
24 PPF 1 1/4% July 1, 2004 to
25 June 30, [2009] 2010
26 FPF 1 1/4% July 1, 2004 to
27 June 30, [2009] 2010
28 BERS 1 1/4% July 1, 2004 to
29 June 30, [2009] 2010
30 § 3. Paragraph 2 of subdivision g of section 13-638.2 of the adminis-
31 trative code of the city of New York, as amended by chapter 152 of the
32 laws of 2006, is amended to read as follows:
33 (2) Such additional interest shall be included at the rates and for
34 the periods set forth below in this paragraph:
35 First day and
36 last day of
37 Rate of interest fiscal year or
38 per centum per series of fiscal
39 Retirement annum, compounded years for which
40 System annually rate is effective
41 ________________________________________________________________________
42 NYCERS 1 1/4% July 1, 2004 to
43 June 30, [2009] 2010
44 NYCTRS 1 1/4% July 1, 2004 to
45 June 30, [2009] 2010
46 PPF 1 1/4% July 1, 2004 to
47 June 30, [2009] 2010
48 FPF 1 1/4% July 1, 2004 to
49 June 30, [2009] 2010
50 BERS 1 1/4% July 1, 2004 to
51 June 30, [2009] 2010
S. 5918 3
1 § 4. Paragraph 2 of subdivision i of section 13-638.2 of the adminis-
2 trative code of the city of New York, as amended by chapter 152 of the
3 laws of 2006, is amended to read as follows:
4 (2) Such supplementary interest shall be allowed at the rates and for
5 the periods set forth below in this paragraph:
6 First day and
7 last day of
8 Rate of interest fiscal year or
9 per centum per series of fiscal
10 Retirement annum, compounded years for which
11 System annually rate is effective
12 ________________________________________________________________________
13 NYCERS 1% July 1, 2004 to
14 June 30, [2009] 2010
15 NYCTRS 1% July 1, 2004 to
16 June 30, [2009] 2010
17 PPF 1% July 1, 2004 to
18 June 30, [2009] 2010
19 FPF 1% July 1, 2004 to
20 June 30, [2009] 2010
21 BERS 1% July 1, 2004 to
22 June 30, [2009] 2010
23 § 5. This act shall take effect July 1, 2009, except that if it shall
24 have become a law subsequent to such date, this act shall take effect
25 immediately and shall be deemed to have been in full force and effect on
26 and after July 1, 2009.
FISCAL NOTE.-- PROVISIONS OF PROPOSED LEGISLATION - OVERVIEW:
The enactment of this proposed legislation (referred to hereafter as
"Interest Rate Extender Legislation") would amend Administrative Code of
the City of New York ("ACNY") Section 13-638.2 to continue for Fiscal
Year 2010 for the five actuarially-funded New York City Retirement
Systems ("NYCRS") the following rates that expire on June 30, 2009:
* The 8.25% per annum rate used to credit interest on Tier I and Tier
II member account balances and Increased-Take-Home-Pay ("ITHP")
Reserves, and
* The 8.0% per annum Actuarial Interest Rate ("AIR") assumption used
to compute employer contributions.
The Effective Date for this proposed Interest Rate Extender Legis-
lation would be July 1, 2009.
FINANCIAL IMPACT - EMPLOYER CONTRIBUTIONS: The continuation for Fiscal
Year 2010 of the same 8.25% per annum rate that was used for Fiscal Year
2009 to credit interest on Tier I and Tier II member contributions and
ITHP Reserves would not change the amount or timing of expected employer
contributions.
The continuation for Fiscal Year 2010 of the AIR assumption of 8.0%
per annum that was used to determine employer contributions to the NYCRS
for Fiscal Year 2009 would not change the expected amount or timing of
employer contributions.
Note: The Actuary anticipates developing proposed changes in actuarial
assumptions and methods to be effective for Fiscal Year 2010 or 2011 but
not until late Fiscal Year 2010 or sometime during Fiscal Year 2011.
The financial impact of implementing those proposed changes in actuar-
ial assumptions and methods can be expected to differ from the financial
S. 5918 4
impact determined using the actuarial assumptions and methods continued
from Fiscal Year 2009.
OTHER COSTS: Enactment of this proposed legislation would not be
expected to produce any additional costs.
STATEMENT OF ACTUARIAL OPINION: I, Robert C. North, Jr., am the Chief
Actuary for the New York City Retirement Systems. I am a Fellow of the
Society of Actuaries and a Member of the American Academy of Actuaries.
I meet the Qualification Standards of the American Academy of Actuaries
to render the actuarial opinion contained herein.
FISCAL NOTE IDENTIFICATION: This estimate is intended for use only
during the 2009 Legislative Session. It is Fiscal Note 2009-10, dated
June 9, 2009, prepared by the Chief Actuary for the New York City
Retirement Systems.
