STATE OF NEW YORK
________________________________________________________________________
6864--A
2023-2024 Regular Sessions
IN SENATE
May 11, 2023
___________
Introduced by Sens. JACKSON, SANDERS -- 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
AN ACT to amend the retirement and social security law and the education
law, in relation to the retirement contributions of career public
employees
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Subdivision a of section 517 of the retirement and social
2 security law, as amended by chapter 18 of the laws of 2012, the second
3 undesignated paragraph as amended by section 1 of part SS of chapter 56
4 of the laws of 2022, is amended to read as follows:
5 a. Members shall contribute three percent of annual wages to the
6 retirement system in which they have membership, provided that such
7 contributions shall not be required for more than thirty years, for
8 general members, or twenty-five years, for police/fire members, except
9 that beginning April first, two thousand thirteen for members who first
10 become members of the New York state and local employees' retirement
11 system on or after April first, two thousand twelve, the rate at which
12 each such member shall contribute in any current plan year (April first
13 to March thirty-first) shall be determined by reference to the wages of
14 such member in the second plan year (April first to March thirty-first)
15 preceding such current plan year as follows:
16 1. members with wages of forty-five thousand dollars per annum or less
17 shall contribute three per centum of annual wages;
18 2. members with wages greater than forty-five thousand per annum, but
19 not more than fifty-five thousand per annum shall contribute three and
20 one-half per centum of annual wages;
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD10049-07-4
S. 6864--A 2
1 3. members with wages greater than fifty-five thousand per annum, but
2 not more than seventy-five thousand per annum shall contribute four and
3 one-half per centum of annual wages;
4 4. members with wages greater than seventy-five thousand per annum but
5 not more than one hundred thousand per annum shall contribute five and
6 three-quarters per centum of annual wages; and
7 5. members with wages greater than one hundred thousand per annum
8 shall contribute six per centum of annual wages.
9 Notwithstanding the foregoing, during each of the first three plan
10 years (April first to March thirty-first) in which such member has
11 established membership in the New York state and local employees'
12 retirement system, such member shall contribute a percentage of annual
13 wages in accordance with the preceding schedule based upon a projection
14 of annual wages provided by the employer. Notwithstanding the foregoing,
15 when determining the rate at which each such member who became a member
16 of the New York state and local employees' retirement system on or after
17 April first, two thousand twelve shall contribute for any plan year
18 (April first to March thirty-first) between April first, two thousand
19 twenty-two and April first, two thousand twenty-four, such rate shall be
20 determined by reference to employees annual base wages of such member in
21 the second plan year (April first to March thirty-first) preceding such
22 current plan year. Base wages shall include regular pay, shift differen-
23 tial pay, location pay, and any increased hiring rate pay, but shall not
24 include any overtime payments.
25 Notwithstanding the foregoing, on and after the effective date of this
26 paragraph, the rate of contribution for members with ten or more years
27 of membership shall be three per centum of annual wages.
28 The head of each retirement system shall promulgate such regulations
29 as may be necessary and appropriate with respect to the deduction of
30 such contribution from members' wages and for the maintenance of any
31 special fund or funds with respect to amounts so contributed.
32 § 2. Subdivision a of section 613 of the retirement and social securi-
33 ty law, as amended by chapter 10 of the laws of 2000, paragraphs 1 and 2
34 as amended by chapter 510 of the laws of 2015, the second undesignated
35 paragraph of paragraph 1 and the second undesignated paragraph of para-
36 graph 2 as amended by section 2 of part SS of chapter 56 of the laws of
37 2022, is amended to read as follows:
38 a. 1. Except as provided by paragraph two of this subdivision, members
39 shall contribute three percent of annual wages to the retirement system
40 in which they have membership, except that beginning April first, two
41 thousand thirteen for members who first become members of a public
42 retirement system of the state on or after April first, two thousand
43 twelve, the rate at which each such member shall contribute in any
44 current plan year (April first to March thirty-first, except for members
45 of the New York city employees' retirement system, New York city teach-
46 ers' retirement system and New York city board of education retirement
47 system, plan year shall mean January first through December thirty-first
48 commencing with the January first next succeeding the effective date of
49 the chapter of the laws of two thousand fifteen that amended this para-
50 graph) shall be determined by reference to the wages of such member in
51 the second plan year (April first to March thirty-first, except for
52 members of the New York city employees' retirement system, New York city
53 teachers' retirement system and New York city board of education retire-
54 ment system, plan year shall mean January first through December thir-
55 ty-first commencing with the January first next succeeding the effective
S. 6864--A 3
1 date of the chapter of the laws of two thousand fifteen that amended
2 this paragraph) preceding such current plan year as follows:
3 (i) members with wages of forty-five thousand dollars per annum or
4 less shall contribute three per centum of annual wages;
5 (ii) members with wages greater than forty-five thousand per annum,
6 but not more than fifty-five thousand per annum shall contribute three
7 and one-half per centum of annual wages;
8 (iii) members with wages greater than fifty-five thousand per annum,
9 but not more than seventy-five thousand per annum shall contribute four
10 and one-half per centum of annual wages;
11 (iv) members with wages greater than seventy-five thousand per annum
12 but not more than one hundred thousand per annum shall contribute five
13 and three-quarters per centum of annual wages; and
14 (v) members with wages greater than one hundred thousand per annum
15 shall contribute six per centum of annual wages.
16 Notwithstanding the foregoing, during each of the first three plan
17 years (April first to March thirty-first, except for members of New York
18 city employees' retirement system, New York city teachers' retirement
19 system and New York city board of education retirement system, plan year
20 shall mean January first through December thirty-first commencing with
21 the January first next succeeding the effective date of chapter five
22 hundred ten of the laws of two thousand fifteen) in which such member
23 has established membership in a public retirement system of the state,
24 such member shall contribute a percentage of annual wages in accordance
25 with the preceding schedule based upon a projection of annual wages
26 provided by the employer. Notwithstanding the foregoing, when determin-
27 ing the rate at which each such member who became a member of the New
28 York state and local employees' retirement system, New York city employ-
29 ees' retirement system, New York city teachers' retirement system and
30 New York city board of education retirement system, on or after April
31 first, two thousand twelve shall contribute for any plan year (April
32 first to March thirty-first, except for members of the New York city
33 employees' retirement system, New York city teachers' retirement system
34 and New York city board of education retirement system, plan year shall
35 mean January first through December thirty-first commencing with January
36 first next succeeding the effective date of chapter five hundred ten of
37 the laws of two thousand fifteen) between April first, two thousand
38 twenty-two and April first, two thousand twenty-four, such rate shall be
39 determined by reference to employees annual base wages of such member in
40 the second plan year (April first to March thirty-first) preceding such
41 current plan year. Base wages shall include regular pay, shift differen-
42 tial pay, location pay, and any increased hiring rate pay, but shall not
43 include any overtime payments or compensation earned for extracurricular
44 programs or any other pensionable earnings paid in addition to the annu-
45 al base wages.
46 Notwithstanding the foregoing, on and after the effective date of this
47 paragraph, the rate of contribution for members with ten or more years
48 of membership shall be three per centum of annual wages.
49 The head of each retirement system shall promulgate such regulations
50 as may be necessary and appropriate with respect to the deduction of
51 such contribution from members' wages and for the maintenance of any
52 special fund or funds with respect to amounts so contributed.
53 2. A member of the New York city employees' retirement system who is
54 eligible to be a participant in the twenty-five-year and age fifty-five
55 retirement program, as defined by paragraph five of subdivision a of
56 section six hundred four-b of this article shall contribute two percent
S. 6864--A 4
1 of annual wages to such system effective on the starting date of the
2 elimination of additional member contributions, as defined in an
3 election made pursuant to paragraph ten of subdivision e of section six
4 hundred four-b of this article, except that beginning April first, two
5 thousand thirteen for members who first become members of the New York
6 city employees' retirement system on or after April first, two thousand
7 twelve, the rate at which each such member shall contribute in any
8 current plan year (April first to March thirty-first, provided, however,
9 that plan year shall mean January first through December thirty-first
10 commencing with the January first next succeeding the effective date of
11 the chapter of the laws of two thousand fifteen that amended this para-
12 graph) shall be determined by reference to the wages of such member in
13 the second plan year (April first to March thirty-first, provided,
14 however, that plan year shall mean January first through December thir-
15 ty-first commencing with the January first next succeeding the effective
16 date of the chapter of the laws of two thousand fifteen that amended
17 this paragraph) preceding such current plan year as follows:
18 (i) members with wages of forty-five thousand dollars per annum or
19 less shall contribute three per centum of annual wages;
20 (ii) members with wages greater than forty-five thousand per annum,
21 but not more than fifty-five thousand per annum shall contribute three
22 and one-half per centum of annual wages;
23 (iii) members with wages greater than fifty-five thousand per annum,
24 but not more than seventy-five thousand per annum shall contribute four
25 and one-half per centum of annual wages;
26 (iv) members with wages greater than seventy-five thousand per annum
27 but not more than one hundred thousand per annum shall contribute five
28 and three-quarters per centum of annual wages; and
29 (v) members with wages greater than one hundred thousand per annum
30 shall contribute six per centum of annual wages.
31 Notwithstanding the foregoing, during each of the first three plan
32 years (April first to March thirty-first, provided, however, that plan
33 year shall mean January first through December thirty-first commencing
34 with the January first next succeeding the effective date of chapter
35 five hundred ten of the laws of two thousand fifteen) in which such
36 member has established membership in the New York city employees'
37 retirement system, such member shall contribute a percentage of annual
38 wages in accordance with the preceding schedule based upon a projection
39 of annual wages provided by the employer. Notwithstanding the foregoing,
40 when determining the rate at which each such member who became a member
41 of, New York city employees' retirement system, on or after April first,
42 two thousand twelve shall contribute for any plan year (April first to
43 March thirty-first, provided, however, that plan year shall mean January
44 first through December thirty-first commencing with the January first
45 next succeeding the effective date of chapter five hundred ten of the
46 laws of two thousand fifteen) between April first, two thousand twenty-
47 two and April first, two thousand twenty-four, such rate shall be deter-
48 mined by reference to employees annual base wages of such member in the
49 second plan year (April first to March thirty-first) preceding such
50 current plan year. Base wages shall include regular pay, shift differen-
51 tial pay, location pay, and any increased hiring rate pay, but shall not
52 include any overtime payments.
53 Notwithstanding the foregoing, on and after the effective date of this
54 paragraph, the rate of contribution for members with ten or more years
55 of membership shall be three per centum of annual wages.
S. 6864--A 5
1 § 3. Subdivisions f and g of section 613 of the retirement and social
2 security law, as amended by chapter 18 of the laws of 2012, the second
3 undesignated paragraph of subdivision f and the second undesignated
4 paragraph of subdivision g as amended by section 2 of part SS of chap-
5 ter 56 of the laws of 2022, are amended to read as follows:
6 f. Anything in subdivision a of this section to the contrary notwith-
7 standing a member employed as a uniformed court officer or peace officer
8 in the unified court system who first joins the New York state and local
9 employees' retirement system on or after January first, two thousand ten
10 shall contribute four percent of annual wages to the New York state and
11 local employees' retirement system, except that beginning April first,
12 two thousand thirteen for members who first become members of the New
13 York state and local employees' retirement system on or after April
14 first, two thousand twelve, the rate at which each such member shall
15 contribute in any current plan year (April first to March thirty-first)
16 shall be determined by reference to the wages of such member in the
17 second plan year (April first to March thirty-first) preceding such
18 current plan year as follows:
19 1. members with wages of forty-five thousand dollars per annum or less
20 shall contribute three per centum of annual wages;
21 2. members with wages greater than forty-five thousand per annum, but
22 not more than fifty-five thousand per annum shall contribute three and
23 one-half per centum of annual wages;
24 3. members with wages greater than fifty-five thousand per annum, but
25 not more than seventy-five thousand per annum shall contribute four and
26 one-half per centum of annual wages;
27 4. members with wages greater than seventy-five thousand per annum but
28 not more than one hundred thousand per annum shall contribute five and
29 three-quarters per centum of annual wages; and
30 5. members with wages greater than one hundred thousand per annum
31 shall contribute six per centum of annual wages.
32 Notwithstanding the foregoing, during each of the first three plan
33 years (April first to March thirty-first) in which such member has
34 established membership in the New York state and local employees'
35 retirement system, such member shall contribute a percentage of annual
36 wages in accordance with the preceding schedule based upon a projection
37 of annual wages provided by the employer. Notwithstanding the foregoing,
38 when determining the rate at which each such member who became a member
39 of the New York state and local employees' retirement system on or after
40 April first, two thousand twelve shall contribute for any plan year
41 (April first to March thirty-first) between April first, two thousand
42 twenty-two and April first, two thousand twenty-four, such rate shall be
43 determined by reference to employees annual base wages of such member in
44 the second plan year (April first to March thirty-first) preceding such
45 current plan year. Base wages shall include regular pay, shift differen-
46 tial pay, location pay, and any increased hiring rate pay, but shall not
47 include any overtime payments.
48 Notwithstanding the foregoing, on and after the effective date of this
49 paragraph, the rate of contribution for members with ten or more years
50 of membership shall be three per centum of annual wages.
51 The head of the New York state and local employees' retirement system
52 shall promulgate such regulations as may be necessary and appropriate
53 with respect to the deduction of such contribution from members' wages
54 and for the maintenance of any special fund or funds with respect to
55 amounts so contributed.
S. 6864--A 6
1 g. Members who first join the New York state teachers' retirement
2 system on or after January first, two thousand ten shall contribute
3 three and one-half percent of annual wages to the New York state teach-
4 ers' retirement system, except that beginning April first, two thousand
5 thirteen for members who first become members of the New York state
6 teachers' retirement system on or after April first, two thousand
7 twelve, the rate at which each such member shall contribute in any
8 current plan year (July first to June thirtieth) shall be determined by
9 reference to the wages of such member in the second plan year (July
10 first to June thirtieth) preceding such current plan year as follows:
11 1. members with wages of forty-five thousand dollars per annum or less
12 shall contribute three per centum of annual wages;
13 2. members with wages greater than forty-five thousand per annum, but
14 not more than fifty-five thousand per annum shall contribute three and
15 one-half per centum of annual wages;
16 3. members with wages greater than fifty-five thousand per annum, but
17 not more than seventy-five thousand per annum shall contribute four and
18 one-half per centum of annual wages;
19 4. members with wages greater than seventy-five thousand per annum but
20 not more than one hundred thousand per annum shall contribute five and
21 three-quarters per centum of annual wages; and
22 5. members with wages greater than one hundred thousand per annum
23 shall contribute six per centum of annual wages.
24 Notwithstanding the foregoing, during each of the first three plan
25 years (July first to June thirtieth) in which such member has estab-
26 lished membership in the New York state teachers' retirement system,
27 such member shall contribute a percentage of annual wages in accordance
28 with the preceding schedule based upon a projection of annual wages
29 provided by the employer. Notwithstanding the foregoing, when determin-
30 ing the contribution rate at which a member of the New York state teach-
31 ers' retirement system with a date of membership on or after April
32 first, two thousand twelve shall contribute for plan years (July first
33 to June thirtieth) between July first, two thousand twenty-two and July
34 first, two thousand twenty-four, such rate shall be determined by refer-
35 ence to the member's annual base wages in the second plan year (July
36 first to June thirtieth) preceding such current plan year. Annual base
37 wages shall not include compensation earned for extracurricular programs
38 or any other pensionable earnings paid in addition to the annual base
39 wages.
40 Notwithstanding the foregoing, on and after the effective date of this
41 paragraph, the rate of contribution for members with ten or more years
42 of membership shall be three per centum of annual wages.
43 The head of the New York state teachers' retirement system shall
44 promulgate such regulations as may be necessary and appropriate with
45 respect to the deduction of such contribution from members' wages and
46 for the maintenance of any special fund or funds with respect to amounts
47 so contributed.
48 § 4. Section 1204 of the retirement and social security law, as
49 amended by chapter 18 of the laws of 2012, the second undesignated
50 paragraph as amended by section 3 of part SS of chapter 56 of the laws
51 of 2022, is amended to read as follows:
52 § 1204. Member contributions. Members who are subject to the
53 provisions of this article shall contribute three percent of annual
54 wages to the retirement system in which they have membership, except
55 that beginning April first, two thousand thirteen for members who first
56 become members of the New York state and local police and fire retire-
S. 6864--A 7
1 ment system on or after April first, two thousand twelve, the rate at
2 which each such member shall contribute in any current plan year (April
3 first to March thirty-first) shall be determined by reference to the
4 wages of such member in the second plan year (April first to March thir-
5 ty-first) preceding such current plan year as follows:
6 a. members with wages of forty-five thousand dollars per annum or less
7 shall contribute three per centum of annual wages;
8 b. members with wages greater than forty-five thousand per annum, but
9 not more than fifty-five thousand per annum shall contribute three and
10 one-half per centum of annual wages;
11 c. members with wages greater than fifty-five thousand per annum, but
12 not more than seventy-five thousand per annum shall contribute four and
13 one-half per centum of annual wages;
14 d. members with wages greater than seventy-five thousand per annum but
15 not more than one hundred thousand per annum shall contribute five and
16 three-quarters per centum of annual wages; and
17 e. members with wages greater than one hundred thousand per annum
18 shall contribute six per centum of annual wages.
19 Notwithstanding the foregoing, during each of the first three plan
20 years (April first to March thirty-first) in which such member has
21 established membership in the New York state and local police and fire
22 retirement system, such member shall contribute a percentage of annual
23 wages in accordance with the preceding schedule based upon a projection
24 of annual wages provided by the employer. Notwithstanding the foregoing,
25 when determining the rate at which each such member who became a member
26 of the New York state and local police and fire retirement system on or
27 after April first, two thousand twelve shall contribute for any plan
28 year (April first to March thirty-first) between April first, two thou-
29 sand twenty-two and April first, two thousand twenty-four, such rate
30 shall be determined by reference to employees annual base wages of such
31 member in the second plan year (April first to March thirty-first)
32 preceding such current plan year. Base wages shall include regular pay,
33 shift differential pay, location pay, and any increased hiring rate pay,
34 but shall not include any overtime payments. Effective April first, two
35 thousand twelve, all members subject to the provisions of this article
36 shall not be required to make member contributions on annual wages
37 excluded from the calculation of final average salary pursuant to
38 section twelve hundred three of this article. Nothing in this section,
39 however, shall be construed or deemed to allow members to receive a
40 refund of any member contributions on such wages paid prior to April
41 first, two thousand twelve.
42 Notwithstanding the foregoing, on and after the effective date of this
43 paragraph, the rate of contribution for members with ten or more years
44 of membership shall be three per centum of annual wages.
45 Members who are enrolled in a retirement plan that limits the amount
46 of creditable service a member can accrue shall not be required to make
47 contributions pursuant to this section after accruing the maximum amount
48 of service credit allowed by the retirement plan in which they are
49 enrolled. The state comptroller shall promulgate such regulations as may
50 be necessary and appropriate with respect to the deduction of such
51 contribution from members' wages and for the maintenance of any special
52 fund or funds with respect to amounts so contributed. In no way shall
53 the member contributions made pursuant to this section be used to
54 provide for pension increases or annuities of any kind.
55 § 5. Subdivision 2 of section 182 of the education law, as amended by
56 chapter 18 of the laws of 2012, is amended to read as follows:
S. 6864--A 8
1 2. Employee contributions. In the case of any electing employee,
2 contributions at the rate of three per centum of [his] the state salary
3 of such employee shall be deducted by the state comptroller as the
4 employee contribution, provided however, that such employee contribution
5 shall be made by the state in accordance with subdivision one of this
6 section during such period as (a) either section seventy-a of the
7 retirement and social security law or section five hundred twenty-eight
8 of this title provides that the contribution of each member of the New
9 York state employees' retirement system or the New York state teachers'
10 retirement system in the employ of the state shall be reduced by at
11 least eight per centum of [his] such employee's compensation, or (b)
12 employee contributions to either such system are no longer required by
13 reason of such system becoming noncontributory for state employees.
14 Notwithstanding any other law to the contrary, beginning April first,
15 two thousand thirteen any electing employee appointed on or after April
16 first, two thousand twelve, the rate at which each such employee shall
17 contribute in any current plan year (January first to December thirty-
18 first) shall be determined by reference to the wages of such member in
19 the second plan year (January first to December thirty-first) preceding
20 such current plan year as follows:
21 (a) members with wages of forty-five thousand dollars per annum or
22 less shall contribute three per centum of annual wages;
23 (b) members with wages greater than forty-five thousand per annum, but
24 not more than fifty-five thousand per annum shall contribute three and
25 one-half per centum of annual wages;
26 (c) members with wages greater than fifty-five thousand per annum, but
27 not more than seventy-five thousand per annum shall contribute four and
28 one-half per centum of annual wages;
29 (d) members with wages greater than seventy-five thousand per annum
30 but not more than one hundred thousand per annum shall contribute five
31 and three-quarters per centum of annual wages; and
32 (e) members with wages greater than one hundred thousand per annum
33 shall contribute six per centum of annual wages.
34 Notwithstanding the foregoing, during each of the first three plan
35 years (January first to December thirty-first) in which such member has
36 established membership in the Education Department Optional Retirement
37 Program, such employee shall contribute a percent of annual wages in
38 accordance with the preceding schedule based upon a projection of annual
39 wages provided by the employer.
40 Notwithstanding the foregoing, on and after the effective date of this
41 paragraph, the rate of contribution for members with ten or more years
42 of membership shall be three per centum of annual wages.
43 § 6. Paragraph (d) of subdivision 2 of section 392 of the education
44 law, as added by chapter 18 of the laws of 2012, is amended to read as
45 follows:
46 (d) Notwithstanding any other law to the contrary, beginning April
47 first, two thousand thirteen any electing employee appointed on or after
48 April first, two thousand twelve, the rate at which each such employee
49 shall contribute in any current plan year (January first to December
50 thirty-first) shall be determined by reference to the wages of such
51 member in the second plan year (January first to December thirty-first)
52 preceding such current plan year as follows:
53 (i) members with wages of forty-five thousand dollars per annum or
54 less shall contribute three per centum of annual wages;
S. 6864--A 9
1 (ii) members with wages greater than forty-five thousand per annum,
2 but not more than fifty-five thousand per annum shall contribute three
3 and one-half per centum of annual wages;
4 (iii) members with wages greater than fifty-five thousand per annum,
5 but not more than seventy-five thousand per annum shall contribute four
6 and one-half per centum of annual wages;
7 (iv) members with wages greater than seventy-five thousand per annum
8 but not more than one hundred thousand per annum shall contribute five
9 and three-quarters per centum of annual wages; and
10 (v) members with wages greater than one hundred thousand per annum
11 shall contribute six per centum of annual wages.
12 Notwithstanding the foregoing, during each of the first three plan
13 years (January first to December thirty-first) in which such member has
14 established membership in the State University Optional Retirement
15 Program, such employee shall contribute a percent of annual wages in
16 accordance with the preceding schedule based upon a projection of annual
17 wages provided by the employer.
18 Notwithstanding the foregoing, on and after the effective date of this
19 paragraph, the rate of contribution for members with ten or more years
20 of membership shall be three per centum of annual wages.
21 § 7. Paragraph (d) of subdivision 2 of section 6252 of the education
22 law, as added by chapter 18 of the laws of 2012, is amended to read as
23 follows:
24 (d) Notwithstanding any other law to the contrary, beginning April
25 first, two thousand thirteen any electing employee appointed on or after
26 April first, two thousand twelve, the rate at which each such employee
27 shall contribute in any current plan year (January first to December
28 thirty-first) shall be determined by reference to the wages of such
29 member in the second plan year (January first to December thirty-first)
30 preceding such current plan year as follows:
31 (1) members with wages of forty-five thousand dollars per annum or
32 less shall contribute three per centum of annual wages;
33 (2) members with wages greater than forty-five thousand per annum, but
34 not more than fifty-five thousand per annum shall contribute three and
35 one-half per centum of annual wages;
36 (3) members with wages greater than fifty-five thousand per annum, but
37 not more than seventy-five thousand per annum shall contribute four and
38 one-half per centum of annual wages;
39 (4) members with wages greater than seventy-five thousand per annum
40 but not more than one hundred thousand per annum shall contribute five
41 and three-quarters per centum of annual wages; and
42 (5) members with wages greater than one hundred thousand per annum
43 shall contribute six per centum of annual wages.
44 Notwithstanding the foregoing, during each of the first three plan
45 years (January first to December thirty-first) in which such member has
46 established membership in the Board of Higher Education Optional Retire-
47 ment Program, such employee shall contribute a percent of annual wages
48 in accordance with the preceding schedule based upon a projection of
49 annual wages provided by the employer.
50 Notwithstanding the foregoing, on and after the effective date of this
51 paragraph, the rate of contribution for members with ten or more years
52 of membership shall be three per centum of annual wages.
53 § 8. Notwithstanding any other provision of law to the contrary, none
54 of the provisions of this act shall be subject to section 25 of the
55 retirement and social security law.
S. 6864--A 10
1 § 9. No employee contributions made by a member of a public retire-
2 ment system prior to the effective date of this act shall be refunded as
3 a result of this act becoming a law.
4 § 10. This act shall take effect April 1, 2024.
FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
This bill would decrease the member contribution rate to three (3)
percent for Tier 5 uniformed court officers and peace officers in the
unified court system (UCPO) and all Tier 6 members of the New York State
and Local Retirement System (NYSLRS) with ten or more years of member-
ship, effective April 1, 2024. The current member contribution rate for
a Tier 5 UCPO is four (4) percent, regardless of membership tenure. The
current member contribution rate for Tier 6 members is variable, depend-
ing on annual compensation, between three (3) percent and six (6)
percent, regardless of membership tenure. There will be no refund of
member contributions.
It is anticipated that this proposal will not become law until after
the effective date of April 1, 2024, in which case member contribution
rates will need to be revised retroactively. This will result in signif-
icant administrative costs to the NYSLRS and its more than 3,000 partic-
ipating employers.
Insofar as this bill affects the New York State and Local Employees'
Retirement System (NYSLERS), the increased costs would be shared by the
State of New York and the local participating employers in the NYSLERS.
If this bill were enacted during the 2024 Legislative Session, the
increase in the present value of future costs would be approximately
$2.73 billion.
Increase in Increase in
NYSLERS Present Value of Required
Future Costs Contributions
Tiers 1 - 5 $0.003 billion $0.42 billion
Tier 6 $2.73 billion $2.31 billion
Total $2.73 billion $2.73 billion
In the NYSLERS, this benefit improvement will be funded by (1) billing
a past service cost to all participating employers to cover retrospec-
tive benefit increases and (2) increasing the Tier 5 UCPO and Tier 6
billing rates charged annually to cover prospective benefit increases,
as follows:
(1) To fund retrospective costs, we anticipate an increase in the
billing rates charged annually to all participating employers by approx-
imately 0.3% of salary, beginning with the fiscal year ending March 31,
2026.
(2) To fund prospective costs, there would be a further increase in
the annual billing rate for any Tier 5 UCPO by 0.4% of salary (for a
0.7% total annual rate increase) and further increase the annual billing
rates for all Tier 6 members in the NYSLERS by 1.2% of salary (for a
1.5% total annual rate increase) beginning with the fiscal year ending
March 31, 2026. This permanent annual cost will vary in subsequent bill-
ing cycles with changes in the billing rate and salary of the affected
members.
Insofar as this bill affects the New York State and Local Police and
Fire Retirement System (NYSLPFRS), the increased costs would be shared
by the State of New York and the local participating employers in the
NYSLPFRS. If this bill were enacted during the 2024 Legislative Session,
S. 6864--A 11
the increase in the present value of future costs would be approximately
$555 million.
Increase in Increase in
NYSLPFRS Present Value of Required
Future Costs Contributions
Tiers 1 - 5 $0 $45 million
Tier 6 $555 million $510 million
Total $555 million $555 million
In the NYSLPFRS, this benefit improvement will be funded by (1) bill-
ing a past service cost to all participating employers to cover retro-
spective benefit increases and (2) increasing the Tier 6 billing rates
charged annually to cover prospective benefit increases, as follows:
(1) To fund retrospective costs, we anticipate an increase in the
billing rates charged annually to all participating employers by approx-
imately 0.2% of salary, beginning with the fiscal year ending March 31,
2026.
(2) To fund prospective costs, there would be a further increase in
the annual billing rate for all Tier 6 members in the NYSLPFRS by 1.6%
of salary (for a 1.8% total annual rate increase) beginning with the
fiscal year ending March 31, 2026. This permanent annual cost will vary
in subsequent billing cycles with changes in the billing rate and salary
of the affected members.
These estimated costs are based on 265,829 Tier 5 UCPO and Tier 6
members with annual salary of approximately $12 billion in the NYSLERS
and 16,538 Tier 6 members with annual salary of approximately $1.5
billion in the NYSLPFRS, as of March 31, 2023.
Summary of relevant resources:
Membership data as of March 31, 2023 was used in measuring the impact
of the proposed change, the same data used in the April 1, 2023 actuari-
al valuation. Distributions and other statistics can be found in the
2023 Report of the Actuary and the 2023 Annual Comprehensive Financial
Report.
The actuarial assumptions and methods used are described in the 2023
Annual Report to the Comptroller on Actuarial Assumptions, and the
Codes, Rules and Regulations of the State of New York: Audit and
Control.
The Market Assets and GASB Disclosures are found in the March 31, 2023
New York State and Local Retirement System Financial Statements and
Supplementary Information.
I am a member of the American Academy of Actuaries and meet the Quali-
fication Standards to render the actuarial opinion contained herein.
This fiscal note does not constitute a legal opinion on the viability
of the proposed change nor is it intended to serve as a substitute for
the professional judgment of an attorney.
This estimate, dated March 1, 2024, and intended for use only during
the 2024 Legislative Session, is Fiscal Note No. 2024-95, prepared by
the Actuary for the New York State and Local Retirement System.
FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
As it relates to the New York State Teachers' Retirement System, this
bill would amend Section 613 of the Retirement and Social Security Law
to reduce the required employee contribution rate for Tier 5 and 6
members who have attained ten or more years of membership to a flat 3.0%
of salary, payable over the remainder of their careers. Currently, Tier
S. 6864--A 12
5 members are required to contribute at a rate of 3.5% of salary, and
Tier 6 members are required to contribute between 3.0% and 6.0% of sala-
ry, according to a salary-based schedule. No contributions made before
the effective date of this bill would be refunded. This change would be
effective on April 1, 2024.
The annual cost to the employers of members of the New York State
Teachers' Retirement System for this benefit is estimated to be $134.9
million or 0.70% of payroll if this bill is enacted.
The System's "new entrant rate", a hypothetical employer contribution
rate that would occur if we started a new Retirement System without any
assets, is equal to 5.31% of pay under the current Tier 6 benefit struc-
ture. This can be thought of as the long-term expected employer cost of
Tier 6, based on current actuarial assumptions. For the proposed change
to the Tier 6 benefit structure under this bill, this new entrant rate
is estimated to increase to 6.26% of pay, an increase of 0.95% of pay.
Member data is from the System's most recent actuarial valuation files
as of June 30, 2023, consisting of data provided by the employers to the
Retirement System. The most recent data distributions and statistics can
be found in the System's Annual Report for fiscal year ended June 30,
2023. System assets are as reported in the System's financial statements
and can also be found in the System's Annual Report. Actuarial assump-
tions and methods are provided in the System's Actuarial Valuation
Report as of June 30, 2023.
The source of this estimate is Fiscal Note 2024-27 dated March 15,
2024 prepared by the Office of the Actuary of the New York State Teach-
ers' Retirement System and is intended for use only during the 2024
Legislative Session. I, Richard A. Young, am the Chief Actuary for the
New York State Teachers' Retirement System. I am a member of the Ameri-
can Academy of Actuaries and I meet the Qualification Standards of the
American Academy of Actuaries to render the actuarial opinion contained
herein.
FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
SUMMARY: This proposed legislation, as it relates to the New York City
Retirement Systems and Pension Funds (NYCRS) would reduce the Basic
Member Contribution rate to 3% upon attaining 10 years of service for
Tier 6 members of NYCERS, TRS, and BERS.
EXPECTED INCREASE (DECREASE) IN EMPLOYER CONTRIBUTIONS
by Fiscal Year for the first 25 years ($ in Millions)
Year NYCERS TRS BERS TOTAL
2025 129.2 123.1 12.1 264.4
2026 138.3 129.6 12.8 280.7
2027 147.9 136.7 13.5 298.1
2028 157.9 144.3 14.3 316.5
2029 168.2 152.6 15.2 336.0
2030 178.9 161.5 16.0 356.4
2031 189.7 171.1 16.9 377.7
2032 200.7 181.3 17.9 399.9
2033 212.0 192.2 18.9 423.1
2034 223.6 204.0 19.9 447.5
2035 235.4 216.6 21.0 473.0
2036 247.3 229.9 22.1 499.3
2037 259.4 243.9 23.2 526.5
2038 271.7 258.7 19.4 549.8
2039 284.1 274.3 20.5 578.9
S. 6864--A 13
2040 248.2 290.5 21.7 560.4
2041 260.7 307.1 22.9 590.7
2042 273.3 324.0 24.1 621.4
2043 286.0 340.7 25.3 652.0
2044 298.7 311.6 26.5 636.8
2045 311.5 327.9 27.7 667.1
2046 324.2 343.8 29.0 697.0
2047 337.1 359.3 30.2 726.6
2048 349.9 374.4 31.5 755.8
2049 362.8 389.0 32.7 784.5
Employer Contribution impact beyond Fiscal Year 2049 is not shown.
Projected contributions include future new hires that may be impacted.
The initial increase in employer contributions of $264.4 million is
estimated to be $191.2 million for New York City and $73.2 million for
the other obligors of NYCRS.
INITIAL INCREASE (DECREASE) IN ACTUARIAL LIABILITIES
as of June 30, 2023 ($ in Millions)
Present Value (PV) NYCERS TRS BERS
PV of Benefits: (97) (118) (9)
PV of Employee Contributions: (1,547) (1,871) (136)
PV of Employer Contributions: 1,450 1,753 127
Unfunded Accrued Liabilities: 427 457 40
AMORTIZATION OF UNFUNDED ACCRUED LIABILITY
NYCERS TRS BERS
Number of Payments: 15 19 13
Fiscal Year of Last Payment: 2039 2043 2037
Amortization Payment: 48.5 M 45.7 M 5.0 M
Unfunded Accrued Liability increases were amortized over the expected
remaining working lifetime of those impacted by the benefit changes
using level dollar payments.
CENSUS DATA: The estimates presented herein are based on preliminary
census data collected as of June 30, 2023. The census data for the
impacted population is summarized below.
NYCERS TRS BERS
Active Members
- Number Count: 85,203 60,663 12,932
- Average Age: 42.4 38.1 46.9
- Average Service: 4.4 5.0 4.0
- Average Salary: 78,900 80,000 56,200
IMPACT ON MEMBER CONTRIBUTIONS: Currently, Tier 6 members of NYCERS,
TRS, and BERS are required to make Basic Member Contributions (BMC)
ranging from 3% to 6% depending on the members' applicable annual wages.
Under the proposed legislation, the required BMC would be a flat 3%
upon attaining 10 years of service, effective April 1, 2024. The
required BMCs prior to attaining 10 years of service would remain
unchanged.
ASSUMPTIONS AND METHODS: The estimates presented herein have been
calculated based on the Revised 2021 Actuarial Assumptions and Methods
of the impacted retirement systems. In addition:
* New entrants were assumed to replace exiting members so that total
payroll increases by 3% each year for impacted groups. New entrant demo-
S. 6864--A 14
graphics were developed based on data for recent new hires and actuarial
judgement.
RISK AND UNCERTAINTY: The costs presented in this Fiscal Note depend
highly on the actuarial assumptions, methods, and models used, demo-
graphics of the impacted population, and other factors such as invest-
ment, contribution, and other risks. If actual experience deviates from
actuarial assumptions, the actual costs could differ from those
presented herein. Quantifying these risks is beyond the scope of this
Fiscal Note.
This Fiscal Note is intended to measure pension-related impacts and
does not include other potential costs (e.g., administrative and Other
Postemployment Benefits).
STATEMENT OF ACTUARIAL OPINION: Marek Tyszkiewicz and Gregory Zelikov-
sky are members of the Society of Actuaries and the American Academy of
Actuaries. We are members of NYCERS but do not believe it impairs our
objectivity and we meet the Qualification Standards of the American
Academy of Actuaries to render the actuarial opinion contained herein.
To the best of our knowledge, the results contained herein have been
prepared in accordance with generally accepted actuarial principles and
procedures and with the Actuarial Standards of Practice issued by the
Actuarial Standards Board.
FISCAL NOTE IDENTIFICATION: This Fiscal Note 2024-20 dated March 6,
2024 was prepared by the Chief Actuary for the New York City Retirement
Systems and Pension Funds. This estimate is intended for use only during
the 2024 Legislative Session.
