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S08070 Summary:

S08070 Actions:

S08070 Committee Votes:

S08070 Floor Votes:

S08070 Text:

 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          8070
 
                    IN SENATE
 
                                     March 26, 2018
                                       ___________
 
        Introduced  by  Sen.  GOLDEN -- read twice and ordered printed, and when
          printed to be committed to the Committee on Civil Service and Pensions
 
        AN ACT granting  retroactive  membership  in  the  teachers'  retirement
          system to Margaret Russo
 
          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:

     1    Section 1. Notwithstanding any other law  to  the  contrary,  Margaret
     2  Russo, who was employed as a part-time employee with the Brooklyn public
     3  library  with a start date of January 1, 1970 until May 1971, and who is
     4  currently a member of the teachers' retirement system of the city of New
     5  York, who through no fault of her own did not become  a  member  of  the
     6  teachers'  retirement  system of the city of New York on January 1, 1970
     7  when first employed by the Brooklyn public library shall  be  deemed  to
     8  have been a member of the teachers' retirement system of the city of New
     9  York on such date.
    10    §  2.  No contributions made to the teachers' retirement system of the
    11  city of New York by Margaret Russo shall be returned or refunded to  her
    12  pursuant to this act.
    13    § 3. This act shall take effect immediately.
          FISCAL NOTE. -- Pursuant to Legislative Law, Section 50:
          SUMMARY  OF  BILL: The proposed legislation would deem Margaret Russo,
        an active Tier 4 member of the New York City Teachers' Retirement System
        (TRS), to be a Tier 1 member with a Membership Date of January 1, 1970.
          Effective Date: Upon enactment.
          BACKGROUND - GENERAL: Ms. Russo is currently a Tier 4 TRS member  with
        a Membership Date of October 1, 1995.
          If the proposed legislation is passed, Ms. Russo would be reclassified
        as a Tier 1 member as if she had joined a public retirement system with-
        in  the  state  upon  her  commencement  of employment with the Brooklyn
        Public Library on January 1, 1970.
          FINANCIAL IMPACT - ACTUARIAL PRESENT VALUES: The  estimated  financial
        impact  of  this  proposal  has  been calculated based on the difference
        between the actuarial present value of (1) the Tier 1 benefits Ms. Russo
        would be expected to receive if this proposed legislation  were  enacted
        (including  two  years of additional service credit under Chapter 126 of
        the Laws of 2000) and (2) the Tier 4 benefits that Ms. Russo is current-
        ly expected to receive.
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD09917-04-8
        S. 8070                             2
 
          Because Tier 1 TRS members are generally permitted to take an actuari-
        al reduction of their retirement allowance to account  for  deficits  in
        member  contributions,  for  purposes  of this fiscal note it is assumed
        that Ms.  Russo would not pay any owed  member  contributions  resulting
        from  the reclassification. Based on the actuarial assumptions and meth-
        ods described herein, as well as  the  application  of  Tier  1  benefit
        calculation provisions, it is estimated that Ms. Russo's Actuarial Pres-
        ent Value of Benefits (APVB) and Actuarial Accrued Liability (AAL) would
        increase  by  approximately  $178,000  and $161,000, respectively, as of
        June 30, 2017.
          FINANCIAL IMPACT - ANNUAL EMPLOYER CONTRIBUTIONS: In  accordance  with
        the  Administrative  Code  of  the  City  of  New  York  (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.
          For  this  proposed legislation, the increase in the UAL was amortized
        over Ms. Russo's expected remaining working lifetime of three years (two
        payments under the  One-Year  Lag  Methodology),  which  results  in  an
        increase in employer contributions of approximately $98,000 per year.
          CONTRIBUTION  TIMING:  If enacted during the 2018 Legislative Session,
        the Tier shift of Ms. Russo would likely first be reflected in the  June
        30,  2018  census  data. In accordance with the One-Year Lag Methodology
        used to determine  employer  contributions,  the  increase  in  employer
        contributions would first be reflected in Fiscal Year 2020.
          OTHER  COSTS:  Not measured in this Fiscal Note are any administrative
        costs associated with implementing this proposed legislation.
          CENSUS DATA: Census data used for the calculations presented herein is
        the census data collected for the June 30, 2017 (Lag) valuation of  TRS.
        As of June 30, 2017 Ms. Russo had 24 years of service, was approximately
        age 66, and had a salary of approximately $145,000.
          ACTUARIAL  ASSUMPTIONS  AND  METHODS:  The  additional  APVB, UAL, and
        employer contributions 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 contributions of TRS except that the actuarial method
        includes a change in the application of the Entry Age Normal cost  meth-
        od.  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.
          STATEMENT  OF ACTUARIAL OPINION: I, Sherry S. Chan, am the Chief Actu-
        ary for, and independent of, the New York City  Retirement  Systems  and
        Pensions  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 2018-08 dated March 23,
        2018, was prepared by the Chief Actuary for the New York City  Teachers'
        Retirement  System.  This  estimate  is intended for use only during the
        2018 Legislative Session.