Relates to promotions of detectives; grants detectives of the third grade and detectives of the second grade the same rights in respect to the police pension fund as detectives of a grade higher after a certain period of time.
STATE OF NEW YORK
________________________________________________________________________
6098--B
2017-2018 Regular Sessions
IN SENATE
May 11, 2017
___________
Introduced by Sen. GOLDEN -- read twice and ordered printed, and when
printed to be committed to the Committee on Cities -- committee
discharged, bill amended, ordered reprinted as amended and recommitted
to said committee -- recommitted to the Committee on Cities in accord-
ance with Senate Rule 6, sec. 8 -- committee discharged, bill amended,
ordered reprinted as amended and recommitted to said committee
AN ACT to amend the administrative code of the city of New York, in
relation to promotions of detectives
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 14-114 of the administrative code of the city of
2 New York is amended by adding a new subdivision d to read as follows:
3 d. (1) When a detective of the third grade shall have served in the
4 rank of detective of the third grade for a period of fifteen years, he
5 or she shall have the same rights in respect to the police pension fund
6 as a detective of the third grade detailed to act as detective of the
7 second grade.
8 (2) When a detective of the second grade shall have served in the rank
9 of detective of the second grade for a period of ten years, he or she
10 shall have the same rights in respect to the police pension fund as a
11 detective of the second grade detailed to act as detective of the first
12 grade.
13 § 2. This act shall take effect immediately.
FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
SUMMARY OF BILL: The enactment of this proposed legislation would
amend Administrative Code of the City of New York (ACCNY) Section 14-114
to allow for a Detective 3rd grade of the New York City Police Depart-
ment (NYPD), who has been a Detective 3rd grade for at least 15 years,
to have the same rights in respect to the New York City Police Pension
Fund (POLICE) as a Detective 3rd grade detailed to act as a Detective
2nd grade and to allow for a Detective 2nd grade of the New York City
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD09842-06-8
S. 6098--B 2
Police Department, who has been a Detective 2nd grade for at least 10
years, to have the same rights in respect to POLICE as a Detective 2nd
grade detailed to act as a Detective 1st grade.
IMPACT ON BENEFITS PAYABLE: The proposed legislation would permit
Detectives of 3rd and 2nd grade, who have met certain service require-
ments, to have their pension calculations based on a higher-grade sala-
ry.
A Detective 3rd grade who would benefit under this proposed legis-
lation, if enacted, would receive an increase in their annual pension
benefit of approximately $6,500 per year and a Detective 2nd grade who
would benefit under this proposed legislations, if enacted would receive
an increase in their annual pension benefit of approximately $8,500 per
year, due to the assumed higher salary grade and overtime.
Based on this increase and an estimate of the number of POLICE members
that are expected to be impacted by this change, it is estimated that if
this proposed legislation is enacted, the annual increase in POLICE
pension benefits paid will be approximately $900,000 per year.
Effective date for this proposed legislation: Upon enactment.
FINANCIAL IMPACT - ACTUARIAL PRESENT VALUES (APV): With respect to the
Detectives who would be impacted by this proposed legislation, the
enactment of this proposed legislation would increase the APV of Bene-
fits (APVB) by approximately $11.4 million.
FINANCIAL IMPACT - EMPLOYER CONTRIBUTIONS: In accordance with the
ACCNY Section 13.638.2(k-2), new Unfunded Accrued Liability (UAL)
attributable to benefit changes are to be amortized as determined by the
Actuary but generally over the remaining working lifetime of those
impacted by the benefit changes. Since the number of Detectives 3rd
grade that will retire with 15 or more years in rank or Detectives 2nd
grade that will retire with 10 or more years in rank cannot be known in
advance with credibility, the APVB due to this legislation has been
treated as an actuarial loss at the affected members' retirement. These
actuarial losses were amortized over a 15-year period (14 payments under
the One-Year Lag Methodology) using level dollar payments for the
purpose of this Fiscal Note.
Based on the assumption that the first group of retirees impacted by
this legislation would occur during Fiscal Year 2019 and the estimated
increase in APVB of $11.4 million, the estimated increase in employer
contributions would be approximately $1.4 million beginning in Fiscal
Year 2021. Future years' costs in addition to the aforementioned cost
would depend on the number of retirees that benefit under the legis-
lation amongst other factors.
CENSUS DATA: These estimates are based on data provided by the NYPD
Detectives' Endowment Association which was not audited but was checked
for reasonableness. Below is a summary of the data provided:
* Salary
* Detective 3rd grade - $111,650
* Detective 2nd grade - $124,305
* Detective 1st grade - $141,308
* Detectives 3rd grade who retired with 15+ years in rank - 336
retired over the past 15 years.
* Detectives 2nd grade who retired with 10+ years in rank - 1,399
retired over the past 16 years.
ACTUARIAL ASSUMPTIONS AND METHODS: The additional employer contrib-
utions presented herein have been calculated based on the same actuarial
assumptions and methods in effect for the June 30, 2016 (Lag) actuarial
valuations used to determine the Preliminary Fiscal Year 2018 employer
S. 6098--B 3
contributions of POLICE. Please note these assumptions and methods are
subject to change as this valuation is not considered final until the
end of the Fiscal Year 2018.
For purposes of analyzing the impact of the proposed legislation, it
was assumed that the benefit impacted by the increase in salary would be
a service benefit based on 20 years of service. The ultimate employer
cost for this proposed legislation would be based on the number, ages,
years of service, and salary of those Detectives 3rd grade that will
retire with 15 or more years in rank or Detectives 2nd grade that will
retire with 10 or more years in rank.
STATEMENT OF ACTUARIAL OPINION: I, Sherry S. Chan, am the Chief Actu-
ary for, and independent of, the New York City Retirement Systems and
Pension Funds. I am a Fellow of the Society of Actuaries, an Enrolled
Actuary under the Employee Retirement Income and Security Act of 1974
(ERISA), a Member of the American Academy of Actuaries, and a Fellow of
the Conference of Consulting Actuaries. I meet the Qualification Stand-
ards of the American Academy of Actuaries to render the actuarial opin-
ion contained herein. To the best of my knowledge, the results contained
herein have been prepared in accordance with generally accepted actuari-
al principles and procedures, and with the Actuarial Standards of Prac-
tice issued by the Actuarial Standards Board.
FISCAL NOTE IDENTIFICATION: This Fiscal Note 2018-04, dated February
14, 2018 was prepared by the Chief Actuary for the New York City Police
Pension Fund. This estimate is intended for use only during the 2018
Legislative Session.