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A06858 Summary:

COSPNSREichenstein, Brabenec, DeStefano, Barron, Byrne, Byrnes, Colton, Griffin
Amd §70, R & SS L
Authorizes the beneficiaries of a member of the state and local employees' retirement system who dies after filing a retirement application to choose pension benefits rather than a death benefit.
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A06858 Text:

                STATE OF NEW YORK
                               2021-2022 Regular Sessions
                   IN ASSEMBLY
                                     April 12, 2021
        Introduced  by  M.  of  A.  ZEBROWSKI, EICHENSTEIN, BRABENEC, DeSTEFANO,
          BYRNE, BYRNES -- read once and referred to the  Committee  on  Govern-
          mental  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
          authorizing the beneficiaries of a  member  of  the  state  and  local
          employees'  retirement system who die after filing a retirement appli-
          cation to choose pension benefits rather than a death benefit
          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 70 of the retirement and social
     2  security law, as amended by chapter 375 of the laws of 2011, is  amended
     3  to read as follows:
     4    a. Any member may retire if he or she shall have attained at least the
     5  minimum retirement age while in service as a member, or while in federal
     6  service,  or in the service of the United Nations or other international
     7  organizations of which the United  States  is  a  member,  as  a  member
     8  continued pursuant to paragraph one of subdivision f of section forty of
     9  this article, or while entitled to make application for a vested retire-
    10  ment  allowance  pursuant to section seventy-six of this title. Any such
    11  member desiring to retire shall execute and file with the comptroller an
    12  application for retirement, which shall specify the  effective  date  of
    13  his  or  her  retirement,  which shall be not less than fifteen nor more
    14  than ninety days subsequent to such date of filing. An  application  for
    15  service retirement, filed hereunder in accordance with the provisions of
    16  subdivision  c  of  section sixty-two or subdivision f of section sixty-
    17  three of this  article,  shall  be  processed  in  the  regular  manner,
    18  provided  that  if  the application filed simultaneously therewith under
    19  either of such subdivisions is granted,  then  and  in  that  event  the
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.

        A. 6858--A                          2
     1  retirement  allowance  granted in accordance with the provisions of this
     2  section shall  be  appropriately  adjusted.  Notwithstanding  any  other
     3  provision  of  law, for any member who is eligible to retire and who has
     4  died  while  in  active  service,  and  who has filed an application for
     5  service retirement less than thirty days prior to  death,  the  member's
     6  active  beneficiary shall have the option to choose the death benefit or
     7  if such member filed an option election form prior to death, the benefit
     8  elected by the member on such form, in which case  the  member  will  be
     9  deemed to have retired the day prior to death.
    10    §  2. Notwithstanding any other provision of law to the contrary, none
    11  of the provisions of this act shall be subject  to  section  25  of  the
    12  retirement and social security law.
    13    §  3.  This  act  shall take effect immediately and shall be deemed to
    14  have been in full force and effect on and after January 1, 2017.
          FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
          This bill would allow a deceased member's active death beneficiary the
        option to make effective the service retirement and option election form
        filed by the member, resulting in payment of  a  survivor's  benefit  in
        lieu  of  the  member's  active death benefit, provided the member is 1)
        eligible to retire (on the day before the date of death), 2) has died in
        active service, 3) has filed an application for service retirement  less
        than  thirty  days  prior  to death, and 4) has filed an option election
        form prior to death. The date used for  the  deemed  service  retirement
        will  be  the  day  prior  to the member's death. This bill will include
        deaths which occurred on or after January 1, 2017.
          If this bill is enacted during the 2022 legislative session, the  cost
        will  depend  upon the deceased member's age, service, salary, plan, and
        the optional form selected by the member on  the  option  election  form
        filed   with   the  New  York  State  and  Local  Employees’  Retirement
        System(NYSLERS).  For standard options, there will be an estimated addi-
        tional cost of up to five (5) times the salary  of  a  deceased  member.
        This cost assumes that the post-retirement death benefit will be payable
        on  behalf  of  eligible  members  when  the  service retirement form is
        selected but not when the active death benefit form is selected.
          The number of members and beneficiaries who could be affected by  this
        legislation  cannot  be  readily  determined,  but  it is estimated that
        approximately 450 beneficiaries could benefit from this  provision  each
        year. Those costs arising would be shared and spread by the State of New
        York and the participating employers in NYSLERS.
          In  addition  to  the  per  person  costs  stated above, there will be
        significant administrative costs to implement  the  provisions  of  this
          Summary of relevant resources:
          Membership  data as of March 31, 2021 was used in measuring the impact
        of the proposed change, the same data used in the April 1, 2021 actuari-
        al valuation.  Distributions and other statistics can be  found  in  the
        2021  Report  of the Actuary and the 2021 Comprehensive Annual Financial
          The actuarial assumptions and methods used are described in  the  2020
        and  2021 Annual Report to the Comptroller on Actuarial Assumptions, and
        the Codes, Rules and Regulations of the State of  New  York:  Audit  and
          The Market Assets and GASB Disclosures are found in the March 31, 2021
        New  York  State  and  Local  Retirement System Financial Statements and
        Supplementary Information.

        A. 6858--A                          3
          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 11, 2022, and intended for use only during
        the 2022 Legislative Session, is Fiscal Note No.  2022-83,  prepared  by
        the Actuary for the New York State and Local Retirement System.
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