Affords certain police/fire members who are members of the fire department pension fund to continue in service past normal retirement age with an additional pension benefit for each year of additional service; provides an additional amount computed at the rate of one-fortieth of his or her final salary for each year of such additional service.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A7698A
SPONSOR: Pheffer Amato TITLE OF BILL:
An act to amend the retirement and social security law, in relation to
affording certain police/fire members who are members of the fire
department pension fund to continue in service past normal retirement
age with an additional pension benefit for each year of additional
service
PURPOSE:
Affords certain police/fire members who are members of the fire depart-
ment pension fund to continue in service past normal retirement age with
an additional pension benefit for each year of additional service
SUMMARY OF PROVISIONS:
Section one of the bill creates a new section of retirement and social
security law, 503-a, which allows for any police or fire member of the
NYFD Pension fund, upon serving past retirement age there shall be added
pension credit which shall be computed at a rate of 1/40 of his or her
salary for each year of such additional service.
Section two of the bill provides that this act shall take effect imme-
diately.
EXISTING LAW:
All correction officers, including correction officers employed by New
York City, are considered to be peace officers under current law.
JUSTIFICATION:
As we face a serious retention and hiring problem in our public sector.
As we work to fix that, we need to thank and protect the brave men and
women who risk their lives to protect us, even after they have the
option to retire. This bill would grant 1/40 of the final salary of a
fire or police member in the New York City Fire Department Pension Fund
to their pension after he or she has reached the eligible age for
retirement.
FISCAL IMPLICATIONS:
Please See Fiscal Note.
EFFECTIVE DATE:
This act shall take effect immediately.
STATE OF NEW YORK
________________________________________________________________________
7698--A
2023-2024 Regular Sessions
IN ASSEMBLY
June 6, 2023
___________
Introduced by M. of A. PHEFFER AMATO -- read once and referred to the
Committee on Governmental Employees -- recommitted to the Committee on
Governmental Employees in accordance with Assembly Rule 3, sec. 2 --
committee discharged, bill amended, ordered reprinted as amended and
recommitted to said committee
AN ACT to amend the retirement and social security law, in relation to
affording certain police/fire members who are members of the fire
department pension fund to continue in service past normal retirement
age with an additional pension benefit for each year of additional
service
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 section 503-a to read as follows:
3 § 503-a. Extra pension service credits. Notwithstanding any provision
4 of law to the contrary, a police/fire member who is a member of the New
5 York city fire department pension fund may continue in service past the
6 date that he or she attains normal retirement age. In such event and
7 upon his or her retirement for any cause whatsoever, there shall be
8 added to his or her annual pension to which he or she shall upon his or
9 her retirement be entitled an additional amount computed at the rate of
10 one-fortieth of his or her final salary for each year of such additional
11 service.
12 § 2. This act shall take effect immediately.
FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
SUMMARY: This proposed legislation would provide Tier 3 members of the
New York City Fire Pension Fund (FIRE) an additional 1/40th of "final
salary" benefit for each year of credited service beyond 22 years of
service.
EXPECTED INCREASE (DECREASE) IN EMPLOYER CONTRIBUTIONS
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD10130-03-4
A. 7698--A 2
by Fiscal Year for the first 25 years ($ in Millions)
Year FIRE
2025 42.6
2026 46.3
2027 50.0
2028 53.9
2029 58.1
2030 62.5
2031 67.1
2032 71.9
2033 76.8
2034 81.9
2035 87.2
2036 92.6
2037 98.0
2038 103.6
2039 109.1
2040 114.7
2041 120.2
2042 125.7
2043 116.8
2044 122.2
2045 127.4
2046 132.5
2047 137.6
2048 142.4
2049 147.2
Employer Contribution impact beyond Fiscal Year 2049 is not shown.
Projected contributions include future new hires that may be impacted.
The entire increase in employer contributions will be allocated to New
York City.
INITIAL INCREASE (DECREASE) IN ACTUARIAL LIABILITIES
as of June 30, 2023 ($ in Millions)
Present Value (PV) FIRE
PV of Benefits: 627.2
PV of Employee Contributions: 0.8
PV of Employer Contributions: 626.4
Unfunded Accrued Liabilities: 138.9
AMORTIZATION OF UNFUNDED ACCRUED LIABILITY
FIRE
Number of Payments: 18
Fiscal Year of Last Payment: 2042
Amortization Payment: 14.3 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.
FIRE
Active Members
A. 7698--A 3
- Number Count: 5,030
- Average Age: 33.5
- Average Service: 5.5
- Average Salary: 112,400
IMPACT ON MEMBER BENEFITS: This proposed legislation would increase
the annual pension for members who retire for service, ordinary disabil-
ity, or accidental disability by 1/40th of Final Salary for each addi-
tional year of credited service, or fraction thereof, exceeding 22
years. For the purposes of this Fiscal Note, Final Salary has been
interpreted as the member's pensionable earnings in their final 12
months of service.
This benefit would be subject to the applicable Cost-of-Living Adjust-
ment or Escalation adjustments.
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:
* The probability of Tier 3 members working beyond 22 years of service
was increased to recognize the impact the proposed legislation would
have on retirement behavior.
* New entrants were assumed to replace exiting members so that total
payroll increases by 3% each year for impacted groups. New entrant demo-
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).
This Fiscal Note does not include cost analyses relating to provisions
contained in Retirement and Social Security Law Section 500(c).
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 2024-43 dated April 9,
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.
