S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  7781

                       2013-2014 Regular Sessions

                          I N  A S S E M B L Y

                              June 4, 2013
                               ___________

Introduced  by  M.  of  A.  MAGNARELLI  -- read once and referred to the
  Committee on Governmental Employees

AN ACT to amend the retirement and social security law, in  relation  to
  military service credit

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. Paragraph (a) of subdivision  2  of  section  1000  of  the
retirement  and social security law, as added by chapter 548 of the laws
of 2000, is amended to read as follows:
  (a) hostilities participated in by the military forces of  the  United
States  in  Lebanon, from the [first] TWENTY-FIRST day of [June] AUGUST,
nineteen hundred [eighty-three] EIGHTY-TWO to the first day of December,
nineteen hundred eighty-seven, as established by receipt  of  the  armed
forces  expeditionary medal, the navy expeditionary medal, or the marine
corps expeditionary medal;
  S 2. This act shall take effect immediately.
  FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
  This bill would extend the benefits of Chapter 548, Laws  of  2000  to
members  of public retirement systems in New York State who rendered any
military  service  during  the  period  of  conflict  in  Lebanon   from
8/20/82-12/1/87.  Currently, the period is defined to be 6/1/83-12/1/87.
The total service credit granted for  any  military  service  shall  not
exceed three (3) years. Members must have at least five years of credit-
ed  service  (not including military service). Tier 1-5 members would be
required to make a payment of three percent of their most recent compen-
sation per year of additional service credit granted by this bill.  Tier
6 members would be required to make a payment of six  percent  of  their
most recent compensation per year of additional service credit.
  If this bill is enacted, insofar as this proposal affects the New York
State and Local Employees' Retirement System (ERS), it is estimated that
the  past service cost will average approximately 12% (9% for Tier 5) of

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD01487-03-3
              

A. 7781                             2

an affected members' compensation for each year  of  additional  service
credit that is purchased.
  Insofar  as  this proposal affects the New York State and Local Police
and Fire Retirement System (PFRS), it is estimated that the past service
cost will average approximately 17% (14% for  Tier  6)  of  an  affected
members'  compensation  for  each  year  of  additional  service that is
purchased.
  The exact number of current members as  well  as  future  members  who
could be affected by this legislation cannot be readily determined.
  ERS Costs: Pursuant to Section 25 of the Retirement and Social Securi-
ty  Law,  the  increased cost to the New York State and Local Employees'
Retirement System would be borne entirely by the State of New  York  and
would  require  an  itemized appropriation sufficient to pay the cost of
the provision. Since a member can apply for this service credit  at  any
time  prior to retirement, a precise cost can't be determined until each
member, as well as future members, applies for the service credit. Every
year a cost will be determined (and billed to the state) based on  those
benefiting from this provision.
  PFRS  Costs:  These costs would be shared by the State of New York and
the participating employers in the PFRS.
  Summary of relevant resources:
  Data: March 31, 2012 Actuarial Year End  File  with  distributions  of
membership  and  other  statistics  displayed  in the 2012 Report of the
Actuary and 2012 Comprehensive Annual Financial Report.
  Assumptions and Methods: 2010, 2011 and  2012  Annual  Report  to  the
Comptroller on Actuarial Assumptions, Codes Rules and Regulations of the
State of New York: Audit and Control.
  Market  Assets and GASB Disclosures: March 31, 2012 New York State and
Local Retirement System Financial Statements and Supplementary  Informa-
tion.
  Valuations  of Benefit Liabilities and Actuarial Assets: summarized in
the 2012 Actuarial Valuations report.
  I am a member of the American Academy of Actuaries and meet the Quali-
fication Standards to render the actuarial opinion contained herein.
  This estimate, dated January 18, 2013 and intended for use only during
the 2013 Legislative Session, is Fiscal Note No.  2013-51,  prepared  by
the  Actuary  for  the  New  York  State and Local Employees' Retirement
System and the New York State  and  Local  Police  and  Fire  Retirement
System.
  FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
  This  bill would amend subdivision 2 of Section 1000 of the Retirement
and Social Security Law by revising the  starting  date  of  hostilities
participated  in  by the military forces of the United States in Lebanon
from June 1, 1983 to August 21,  1982  for  military  service  crediting
purposes.
  It is not possible to determine the total annual cost to the employers
of  members  of the New York State Teachers' Retirement System since the
total amount of service credit which would be claimed  under  this  bill
cannot  be  estimated.  However, the cost to the employers of members of
the New York State  Teachers'  Retirement  System  is  estimated  to  be
$21,400  per  year of service credited for Tier 1 and 2 members, $18,300
per year of service credited for Tier 3 and 4 members, $16,600 per  year
of  service  credited for Tier 5 members and $10,700 per year of service
credited for Tier 6 members if this bill is enacted.
  The source of this estimate is Fiscal Note 2013-10 dated February  20,
2013  prepared by the Actuary of the New York State Teachers' Retirement

A. 7781                             3

System and is intended for use only during the 2013 Legislative Session.
I, Richard A. Young, am the Actuary for the  New  York  State  Teachers'
Retirement  System.  I  am a member of the American Academy of Actuaries
and  I meet the Qualification Standards of the American Academy of Actu-
aries to render the actuarial opinion contained herein.
  FISCAL NOTE.-- Pursuant to Legislative Law, Section 50:
  PROVISIONS OF PROPOSED LEGISLATION:  The  proposed  legislation  would
amend Retirement and Social Security Law ("RSSL") section 1000 paragraph
(a)  of  subdivision  2  to  change  the  beginning  date of the Lebanon
conflict from June 1, 1983 to August 20, 1982 to match the dates  recog-
nized  by the Federal Government. This would allow any member of the New
York City Retirement Systems ("NYCRS") who had military  service  during
the  hostilities  participated  in  by the military forces of the United
States in Lebanon between August 20, 1982 and May 31, 1983 the  opportu-
nity  to obtain service credit for that period of time if other require-
ments to obtain military service credit are met.
  The Effective Date of the proposed legislation would be  the  date  of
enactment.
  The  Actuary  has  presumed  that retirees as of the enactment of this
proposed legislation would not be eligible to purchase additional  mili-
ary service provided by this proposed legislation.
  IMPACT ON BENEFITS: For purposes of the respective NYCRS, each year of
military  service  credit  purchased  would  apply  toward providing the
member with a year of   benefit accrual  under  the  particular  benefit
formula covering the member.
  The   NYCRS  include:  New  York  City  Employees'  Retirement  System
("NYCERS"), New York City Teachers' Retirement  System  ("NYCTRS"),  New
York  City  Board of Education Retirement System ("BERS"), New York City
Police Pension Fund ("POLICE") and New York Fire Department Pension Fund
("FIRE").
  In certain circumstances, the member also may be entitled  to  utilize
such  military  service  as  qualifying  service for benefit eligibility
purposes.
  For purposes of this Fiscal Note, it has been assumed that members who
purchase military service in accordance with this  proposed  legislation
would  generally  be  entitled to count such service for benefit accrual
purposes and for the purpose of qualifying for benefits.
  MEMBERS IMPACTED: Insofar as this proposed legislation relates to  the
NYCRS,  the  number  of  members who could potentially benefit from this
proposed legislation cannot be readily determined.
  For illustrative purposes only, a table is  included  in  this  Fiscal
Note  presenting the estimated financial impact per member assuming that
the affected member purchases service credit for the entire  August  20,
1982 to May 31, 1983 period.
  FINANCIAL IMPACT - OVERVIEW: With respect to an individual member, the
additional  cost  of  this  proposed  legislation  would  depend  on the
member's length of service not  including  the  military  service  being
purchased,  the  years  of military service being purchased, age, salary
history and Plan in which the member participates.
  With respect to employers participating in  the  NYCRS,  the  ultimate
employer  cost  of  this proposed legislation would be determined by the
increase in benefits to be paid, the impact of certain benefits commenc-
ing earlier, shorter working lifetimes  and  the  reduction  in  certain
future member contributions.
  FINANCIAL IMPACT - ACTUARIAL PRESENT VALUES: With respect to the NYCRS
and  based  on  the census data and assumptions herein, the enactment of

A. 7781                             4

this proposed legislation would increase  the  Actuarial  Present  Value
("APV")  of  benefits  ("APVB")  by  approximately  $12,500  for NYCERS,
$12,300 for NYCTRS, $6,900 for BERS, $20,800 for POLICE and $24,000  for
FIRE per year of service credit purchased as of June 30, 2012.
  In  addition,  with  respect  to  the  NYCRS, the APV of future member
contributions (primarily attributable to the payments by members of 3.0%
of salary per year of military  service  purchased)  would  increase  by
approximately  $2,000  for  NYCERS,  $2,100 for NYCTRS, $1,100 for BERS,
$3,000 for POLICE and  $3,200  for  FIRE  per  year  of  service  credit
purchased as of June 30, 2012.
  Consequently, with respect to the NYCRS, the APV of net future employ-
er  contributions  would  increase  by approximately $10,500 for NYCERS,
$10,200 for NYCTRS, $5,800 for BERS, $17,800 for POLICE and $20,800  for
FIRE per year of service credit purchased as of June 30, 2012.
  FINANCIAL  IMPACT  -  ADDITIONAL  EMPLOYER  COSTS:  Enactment  of this
proposed legislation would increase employer costs, where  such  amounts
depend on the number of members affected and upon the amount of military
service  being  credited  as well as other characteristics including the
age, salary history and Plan in which the member participates.
  With respect to the NYCRS, based on the  Actuary's  actuarial  assump-
tions  and  methods in effect as of June 30, 2012, the enactment of this
proposed legislation is estimated to increase annual employer  costs  by
approximately  $1,200  for  NYCERS,  $1,200  for  NYCTRS, $700 for BERS,
$2,100 for POLICE and  $2,500  for  FIRE  per  year  of  service  credit
purchased.
  The  real  cost of the enactment of this proposed legislation would be
the additional benefits paid.
  FINANCIAL IMPACT - ADDITIONAL EMPLOYER CONTRIBUTIONS: With respect  to
the  NYCRS,  increases  in employer contributions would depend upon when
the members purchase the military  service  permitted  by  the  proposed
legislation  and  such  service  is credited to their records, but would
ultimately be comparable to the increases in employer costs.
  FINANCIAL IMPACT - SUMMARY: The following table summarizes  the  esti-
mated  financial impact of this proposed legislation on the NYCRS assum-
ing one member in each System is eligible and purchases service for  the
period from August 20, 1982 to May 31, 1983:

        Estimated Financial Impact to Allow Members of the NYCRS
               To Purchase Certain Military Service Credit
                           as of June 30, 2012

                   (Assumes One Member in Each System
                Purchases 0.778 Years{1} of Service Each)

                              ($ Thousands)

                                                           Estimated
                                      Additional          Additional
                  Additional        APV of Future           Annual
Retirement          APV of             Employer            Employer
  System           Benefits         Contributions {2}      Costs {3}

NYCERS              $9.76               $8.20                $0.97
NYCTRS               9.58                7.91                 0.94
BERS                 5.36                4.50                 0.53

A. 7781                             5

POLICE              16.19               13.82                 1.64
FIRE                18.70               16.19                 1.92

  {1}  .778  years represents the length of time from August 20, 1982 to
May 31, 1983.
  {2} Equals increase in APVB minus increase in  APV  of  future  member
contributions
  {3}  Estimated Additional Annual Employer Costs are determined without
regard to the funded status of the Retirement Systems and represent  the
best  estimates  of the ultimate annual financial burden of the proposed
legislation and assume  that  any  additional  APV  of  Future  Employer
Contributions,  as they arise, are amortized as actuarial losses over 15
years (14 payments). Estimated Additional Annual Employer  Contributions
would ultimately approximate estimated Additional Annual Employer Costs.
  If  enacted  during the 2013 Legislative Session and if these affected
members and their amount of military service being credited were identi-
fied on or before June 30, 2014,  this  proposed  legislation  would  be
expected to increase employer contributions, if any, to the NYCRS begin-
ning Fiscal Year 2016.
  OTHER  COSTS:  The enactment of this proposed legislation would result
in some administrative expenses for the NYCRS and costs for Other  Post-
Employment Benefits ("OPEB").
  CENSUS DATA: The census data used for estimates of APV of benefits and
employer  contributions presented herein are the active members included
in the June 30, 2012 (Lag) actuarial valuations of NYCERS, NYCTRS, BERS,
POLICE and FIRE used to  determine  the  Preliminary  Fiscal  Year  2014
employer contributions.
  ACTUARIAL  ASSUMPTIONS AND METHODS: The additional APV of benefits and
employer contributions presented herein have been estimated as  of  June
30,  2012  on  a  hypothetical basis for illustrative purposes with each
eligible member purchasing 0.778 years of military service.
  As benefiting from the provisions  of  this  proposed  legislation  is
dependent  upon  actions  by  Plan members and the timing and amounts of
military service to be purchased are unknown, the financial impact would
likely be realized upon receipt by the Actuary of updated service credit
information.
  Consequently, changes in employer contributions  have  been  estimated
assuming  the increase in the APV of Future Employer Contributions would
be financed over a time period comparable to  that  used  for  actuarial
losses  under  the Entry Age Actuarial Cost Method. Using this approach,
the Additional APV of Future Employer Contributions would  be  amortized
over  a  closed 15-year period (14 payments under One-Year Lag Methodol-
ogy) using level dollar payments.
  ECONOMIC VALUES OF BENEFITS: The actuarial assumptions used to  deter-
mine  the financial impact of the proposed legislation discussed in this
Fiscal Note are those appropriate for budgetary models  and  determining
annual employer contributions to the NYRCS.
  However,  the  economic  assumptions  that  are  used  for determining
employer contributions do not develop risk-adjusted, economic values  of
benefits.   Such risk-adjusted, economic values of benefits would likely
differ significantly from those developed by the budgetary models.
  STATEMENT OF ACTUARIAL OPINION: I, Robert C. North, Jr., am the  Chief
Actuary  for  the New York City Retirement Systems. I am a Fellow of the
Society of Actuaries and a Member of the American Academy of  Actuaries.
I  meet the Qualification Standards of the American Academy of Actuaries
to render the actuarial opinion contained herein.

A. 7781                             6

  FISCAL NOTE IDENTIFICATION: This estimate is  intended  for  use  only
during  the  2013  Legislative Session. It is Fiscal Note 2013-12, dated
May 29, 2013 prepared by the Chief Actuary of the New York City  Retire-
ment Systems.

                            
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                 7781--A

                       2013-2014 Regular Sessions

                          I N  A S S E M B L Y

                              June 4, 2013
                               ___________

Introduced  by  M. of A. MAGNARELLI, BENEDETTO -- read once and referred
  to the Committee on Governmental Employees  --  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
  military service credit

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. Paragraph (a) of subdivision  2  of  section  1000  of  the
retirement  and social security law, as added by chapter 548 of the laws
of 2000, is amended to read as follows:
  (a) hostilities participated in by the military forces of  the  United
States  in  Lebanon, from the [first] TWENTY-FIRST day of [June] AUGUST,
nineteen hundred [eighty-three] EIGHTY-TWO to the first day of December,
nineteen hundred eighty-seven, as established by receipt  of  the  armed
forces  expeditionary medal, the navy expeditionary medal, or the marine
corps expeditionary medal;
  S 2. Notwithstanding any other provision of law to the contrary,  none
of  the  provisions  of  this  act shall be subject to section 25 of the
retirement and social security law.
  S 3. This act shall take effect immediately.
  FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
  This bill would extend the benefits of Chapter 548, Laws  of  2000  to
members  of public retirement systems in New York State who rendered any
military  service  during  the  period  of  conflict  in  Lebanon   from
8/20/82-12/1/87.  Currently, the period is defined to be 6/1/83-12/1/87.
The total service credit granted for  any  military  service  shall  not
exceed three (3) years. Members must have at least five years of credit-
ed  service  (not including military service). Tier 1-5 members would be
required to make a payment of three percent of their most recent compen-
sation per year of additional service credit granted by this bill.  Tier

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD01487-04-3
              

A. 7781--A                          2

6 members would be required to make a payment of six  percent  of  their
most recent compensation per year of additional service credit.
  If this bill is enacted, insofar as this proposal affects the New York
State and Local Employees' Retirement System (ERS), it is estimated that
the  past service cost will average approximately 12% (9% for Tier 5) of
an affected members' compensation for each year  of  additional  service
credit that is purchased.
  Insofar  as  this proposal affects the New York State and Local Police
and Fire Retirement System (PFRS), it is estimated that the past service
cost will average approximately 17% (14% for  Tier  6)  of  an  affected
members'  compensation  for  each  year  of  additional  service that is
purchased.
  The exact number of current members as  well  as  future  members  who
could be affected by this legislation cannot be readily determined.
  ERS Costs: Pursuant to Section 25 of the Retirement and Social Securi-
ty  Law,  the  increased cost to the New York State and Local Employees'
Retirement System would be borne entirely by the State of New  York  and
would  require  an  itemized appropriation sufficient to pay the cost of
the provision. Since a member can apply for this service credit  at  any
time  prior to retirement, a precise cost can't be determined until each
member, as well as future members, applies for the service credit. Every
year a cost will be determined (and billed to the state) based on  those
benefiting from this provision.
  PFRS  Costs:  These costs would be shared by the State of New York and
the participating employers in the PFRS.
  Summary of relevant resources:
  Data: March 31, 2012 Actuarial Year End  File  with  distributions  of
membership  and  other  statistics  displayed  in the 2012 Report of the
Actuary and 2012 Comprehensive Annual Financial Report.
  Assumptions and Methods: 2010, 2011 and  2012  Annual  Report  to  the
Comptroller on Actuarial Assumptions, Codes Rules and Regulations of the
State of New York: Audit and Control.
  Market  Assets and GASB Disclosures: March 31, 2012 New York State and
Local Retirement System Financial Statements and Supplementary  Informa-
tion.
  Valuations  of Benefit Liabilities and Actuarial Assets: summarized in
the 2012 Actuarial Valuations report.
  I am a member of the American Academy of Actuaries and meet the Quali-
fication Standards to render the actuarial opinion contained herein.
  This estimate, dated January 18, 2013 and intended for use only during
the 2013 Legislative Session, is Fiscal Note No.  2013-51,  prepared  by
the  Actuary  for  the  New  York  State and Local Employees' Retirement
System and the New York State  and  Local  Police  and  Fire  Retirement
System.
  FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
  This  bill would amend subdivision 2 of Section 1000 of the Retirement
and Social Security Law by revising the  starting  date  of  hostilities
participated  in  by the military forces of the United States in Lebanon
from June 1, 1983 to August 21,  1982  for  military  service  crediting
purposes.
  It is not possible to determine the total annual cost to the employers
of  members  of the New York State Teachers' Retirement System since the
total amount of service credit which would be claimed  under  this  bill
cannot  be  estimated.  However, the cost to the employers of members of
the New York State  Teachers'  Retirement  System  is  estimated  to  be
$21,400  per  year of service credited for Tier 1 and 2 members, $18,300

A. 7781--A                          3

per year of service credited for Tier 3 and 4 members, $16,600 per  year
of  service  credited for Tier 5 members and $10,700 per year of service
credited for Tier 6 members if this bill is enacted.
  The  source of this estimate is Fiscal Note 2013-10 dated February 20,
2013 prepared by the Actuary of the New York State Teachers'  Retirement
System and is intended for use only during the 2013 Legislative Session.
I,  Richard  A.  Young,  am the Actuary for the New York State Teachers'
Retirement System. I am a member of the American  Academy  of  Actuaries
and  I meet the Qualification Standards of the American Academy of Actu-
aries to render the actuarial opinion contained herein.
  FISCAL NOTE.-- Pursuant to Legislative Law, Section 50:
  PROVISIONS OF PROPOSED LEGISLATION:  The  proposed  legislation  would
amend Retirement and Social Security Law ("RSSL") section 1000 paragraph
(a)  of  subdivision  2  to  change  the  beginning  date of the Lebanon
conflict from June 1, 1983 to August 20, 1982 to match the dates  recog-
nized  by the Federal Government. This would allow any member of the New
York City Retirement Systems ("NYCRS") who had military  service  during
the  hostilities  participated  in  by the military forces of the United
States in Lebanon between August 20, 1982 and May 31, 1983 the  opportu-
nity  to obtain service credit for that period of time if other require-
ments to obtain military service credit are met.
  The Effective Date of the proposed legislation would be  the  date  of
enactment.
  The  Actuary  has  presumed  that retirees as of the enactment of this
proposed legislation would not be eligible to purchase additional  mili-
ary service provided by this proposed legislation.
  IMPACT ON BENEFITS: For purposes of the respective NYCRS, each year of
military  service  credit  purchased  would  apply  toward providing the
member with a year of   benefit accrual  under  the  particular  benefit
formula covering the member.
  The   NYCRS  include:  New  York  City  Employees'  Retirement  System
("NYCERS"), New York City Teachers' Retirement  System  ("NYCTRS"),  New
York  City  Board of Education Retirement System ("BERS"), New York City
Police Pension Fund ("POLICE") and New York Fire Department Pension Fund
("FIRE").
  In certain circumstances, the member also may be entitled  to  utilize
such  military  service  as  qualifying  service for benefit eligibility
purposes.
  For purposes of this Fiscal Note, it has been assumed that members who
purchase military service in accordance with this  proposed  legislation
would  generally  be  entitled to count such service for benefit accrual
purposes and for the purpose of qualifying for benefits.
  MEMBERS IMPACTED: Insofar as this proposed legislation relates to  the
NYCRS,  the  number  of  members who could potentially benefit from this
proposed legislation cannot be readily determined.
  For illustrative purposes only, a table is  included  in  this  Fiscal
Note  presenting the estimated financial impact per member assuming that
the affected member purchases service credit for the entire  August  20,
1982 to May 31, 1983 period.
  FINANCIAL IMPACT - OVERVIEW: With respect to an individual member, the
additional  cost  of  this  proposed  legislation  would  depend  on the
member's length of service not  including  the  military  service  being
purchased,  the  years  of military service being purchased, age, salary
history and Plan in which the member participates.
  With respect to employers participating in  the  NYCRS,  the  ultimate
employer  cost  of  this proposed legislation would be determined by the

A. 7781--A                          4

increase in benefits to be paid, the impact of certain benefits commenc-
ing earlier, shorter working lifetimes  and  the  reduction  in  certain
future member contributions.
  FINANCIAL IMPACT - ACTUARIAL PRESENT VALUES: With respect to the NYCRS
and  based  on  the census data and assumptions herein, the enactment of
this proposed legislation would increase  the  Actuarial  Present  Value
("APV")  of  benefits  ("APVB")  by  approximately  $12,500  for NYCERS,
$12,300 for NYCTRS, $6,900 for BERS, $20,800 for POLICE and $24,000  for
FIRE per year of service credit purchased as of June 30, 2012.
  In  addition,  with  respect  to  the  NYCRS, the APV of future member
contributions (primarily attributable to the payments by members of 3.0%
of salary per year of military  service  purchased)  would  increase  by
approximately  $2,000  for  NYCERS,  $2,100 for NYCTRS, $1,100 for BERS,
$3,000 for POLICE and  $3,200  for  FIRE  per  year  of  service  credit
purchased as of June 30, 2012.
  Consequently, with respect to the NYCRS, the APV of net future employ-
er  contributions  would  increase  by approximately $10,500 for NYCERS,
$10,200 for NYCTRS, $5,800 for BERS, $17,800 for POLICE and $20,800  for
FIRE per year of service credit purchased as of June 30, 2012.
  FINANCIAL  IMPACT  -  ADDITIONAL  EMPLOYER  COSTS:  Enactment  of this
proposed legislation would increase employer costs, where  such  amounts
depend on the number of members affected and upon the amount of military
service  being  credited  as well as other characteristics including the
age, salary history and Plan in which the member participates.
  With respect to the NYCRS, based on the  Actuary's  actuarial  assump-
tions  and  methods in effect as of June 30, 2012, the enactment of this
proposed legislation is estimated to increase annual employer  costs  by
approximately  $1,200  for  NYCERS,  $1,200  for  NYCTRS, $700 for BERS,
$2,100 for POLICE and  $2,500  for  FIRE  per  year  of  service  credit
purchased.
  The  real  cost of the enactment of this proposed legislation would be
the additional benefits paid.
  FINANCIAL IMPACT - ADDITIONAL EMPLOYER CONTRIBUTIONS: With respect  to
the  NYCRS,  increases  in employer contributions would depend upon when
the members purchase the military  service  permitted  by  the  proposed
legislation  and  such  service  is credited to their records, but would
ultimately be comparable to the increases in employer costs.
  FINANCIAL IMPACT - SUMMARY: The following table summarizes  the  esti-
mated  financial impact of this proposed legislation on the NYCRS assum-
ing one member in each System is eligible and purchases service for  the
period from August 20, 1982 to May 31, 1983:

        Estimated Financial Impact to Allow Members of the NYCRS
               To Purchase Certain Military Service Credit
                           as of June 30, 2012

                   (Assumes One Member in Each System
                Purchases 0.778 Years{1} of Service Each)

                              ($ Thousands)

                                                           Estimated
                                      Additional          Additional
                  Additional        APV of Future           Annual
Retirement          APV of             Employer            Employer
  System           Benefits         Contributions {2}      Costs {3}

A. 7781--A                          5

NYCERS              $9.76               $8.20                $0.97
NYCTRS               9.58                7.91                 0.94
BERS                 5.36                4.50                 0.53
POLICE              16.19               13.82                 1.64
FIRE                18.70               16.19                 1.92

  {1}  .778  years represents the length of time from August 20, 1982 to
May 31, 1983.
  {2} Equals increase in APVB minus increase in  APV  of  future  member
contributions
  {3}  Estimated Additional Annual Employer Costs are determined without
regard to the funded status of the Retirement Systems and represent  the
best  estimates  of the ultimate annual financial burden of the proposed
legislation and assume  that  any  additional  APV  of  Future  Employer
Contributions,  as they arise, are amortized as actuarial losses over 15
years (14 payments). Estimated Additional Annual Employer  Contributions
would ultimately approximate estimated Additional Annual Employer Costs.
  If  enacted  during the 2013 Legislative Session and if these affected
members and their amount of military service being credited were identi-
fied on or before June 30, 2014,  this  proposed  legislation  would  be
expected to increase employer contributions, if any, to the NYCRS begin-
ning Fiscal Year 2016.
  OTHER  COSTS:  The enactment of this proposed legislation would result
in some administrative expenses for the NYCRS and costs for Other  Post-
Employment Benefits ("OPEB").
  CENSUS DATA: The census data used for estimates of APV of benefits and
employer  contributions presented herein are the active members included
in the June 30, 2012 (Lag) actuarial valuations of NYCERS, NYCTRS, BERS,
POLICE and FIRE used to  determine  the  Preliminary  Fiscal  Year  2014
employer contributions.
  ACTUARIAL  ASSUMPTIONS AND METHODS: The additional APV of benefits and
employer contributions presented herein have been estimated as  of  June
30,  2012  on  a  hypothetical basis for illustrative purposes with each
eligible member purchasing 0.778 years of military service.
  As benefiting from the provisions  of  this  proposed  legislation  is
dependent  upon  actions  by  Plan members and the timing and amounts of
military service to be purchased are unknown, the financial impact would
likely be realized upon receipt by the Actuary of updated service credit
information.
  Consequently, changes in employer contributions  have  been  estimated
assuming  the increase in the APV of Future Employer Contributions would
be financed over a time period comparable to  that  used  for  actuarial
losses  under  the Entry Age Actuarial Cost Method. Using this approach,
the Additional APV of Future Employer Contributions would  be  amortized
over  a  closed 15-year period (14 payments under One-Year Lag Methodol-
ogy) using level dollar payments.
  ECONOMIC VALUES OF BENEFITS: The actuarial assumptions used to  deter-
mine  the financial impact of the proposed legislation discussed in this
Fiscal Note are those appropriate for budgetary models  and  determining
annual employer contributions to the NYRCS.
  However,  the  economic  assumptions  that  are  used  for determining
employer contributions do not develop risk-adjusted, economic values  of
benefits.   Such risk-adjusted, economic values of benefits would likely
differ significantly from those developed by the budgetary models.
  STATEMENT OF ACTUARIAL OPINION: I, Robert C. North, Jr., am the  Chief
Actuary  for  the New York City Retirement Systems. I am a Fellow of the

A. 7781--A                          6

Society of Actuaries and a Member of the American Academy of  Actuaries.
I  meet the Qualification Standards of the American Academy of Actuaries
to render the actuarial opinion contained herein.
  FISCAL  NOTE  IDENTIFICATION:  This  estimate is intended for use only
during the 2013 Legislative Session. It is Fiscal  Note  2013-12,  dated
May  29, 2013 prepared by the Chief Actuary of the New York City Retire-
ment Systems.

                            
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                 7781--B

                       2013-2014 Regular Sessions

                          I N  A S S E M B L Y

                              June 4, 2013
                               ___________

Introduced  by  M. of A. MAGNARELLI, BENEDETTO -- read once and referred
  to the Committee on Governmental Employees  --  committee  discharged,
  bill  amended,  ordered  reprinted  as amended and recommitted to said
  committee -- reported and referred to the Committee on Ways and  Means
  --  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
  military service credit

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. Paragraph (a) of subdivision  2  of  section  1000  of  the
retirement  and social security law, as added by chapter 548 of the laws
of 2000, is amended to read as follows:
  (a) hostilities participated in by the military forces of  the  United
States  in  Lebanon, from the [first] TWENTY-FIRST day of [June] AUGUST,
nineteen hundred [eighty-three] EIGHTY-TWO to the first day of December,
nineteen hundred eighty-seven, as established by receipt  of  the  armed
forces  expeditionary medal, the navy expeditionary medal, or the marine
corps expeditionary medal;
  S 2. Notwithstanding any other provision of law to the contrary,  none
of  the  provisions  of  this  act shall be subject to section 25 of the
retirement and social security law.
  S 3. This act shall take effect immediately.
  FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
  This bill would extend the benefits of Chapter 548, Laws  of  2000  to
members  of public retirement systems in New York State who rendered any
military  service  during  the  period  of  conflict  in  Lebanon   from
8/20/82-12/1/87.  Currently, the period is defined to be 6/1/83-12/1/87.
The total service credit granted for  any  military  service  shall  not
exceed three (3) years. Members must have at least five years of credit-
ed  service  (not including military service). Tier 1-5 members would be

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD01487-05-3
              

A. 7781--B                          2

required to make a payment of three percent of their most recent compen-
sation per year of additional service credit granted by this bill.  Tier
6  members  would  be required to make a payment of six percent of their
most recent compensation per year of additional service credit.
  If this bill is enacted, insofar as this proposal affects the New York
State and Local Employees' Retirement System (ERS), it is estimated that
the  past service cost will average approximately 12% (9% for Tier 6) of
an affected members' compensation for each year  of  additional  service
credit that is purchased.
  Insofar  as  this proposal affects the New York State and Local Police
and Fire Retirement system (PFRS), it is estimated that the past service
cost will average approximately 17% (14% for  Tier  6)  of  an  affected
members'  compensation  for  each  year  of  additional  service that is
purchased.
  The exact number of current members as  well  as  future  members  who
could be affected by this legislation cannot be readily determined.
  ERS  Costs:  These  costs would be shared by the State of New York and
the participating employers in the ERS.
  PFRS Costs: These costs would be shared by the State of New  York  and
the participating employers in the PFRS.
  Summary of relevant resources:
  Data:  March  31,  2012  Actuarial Year End File with distributions of
membership and other statistics displayed in  the  2012  Report  of  the
Actuary and 2012 Comprehensive Annual Financial Report.
  Assumptions  and  Methods:  2010,  2011  and 2012 Annual Report to the
Comptroller on Actuarial Assumptions, Codes Rules and Regulations of the
State of New York: Audit and Control.
  Market Assets and GASB Disclosures: March 31, 2012 New York State  and
Local  Retirement System Financial Statements and Supplementary Informa-
tion.
  Valuations of Benefit Liabilities and Actuarial Assets: summarized  in
the 2012 Actuarial Valuations report.
  I am a member of the American Academy of Actuaries and meet the Quali-
fication Standards to render the actuarial opinion contained herein.
  This  estimate,  dated  June 11, 2013 and intended for use only during
the 2013 Legislative Session, is Fiscal Note No. 2013-161,  prepared  by
the  Actuary  for  the  New  York  State and Local Employees' Retirement
System and the New York State  and  Local  Police  and  Fire  Retirement
System.
  FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
  This  bill would amend subdivision 2 of Section 1000 of the Retirement
and Social Security Law by revising the  starting  date  of  hostilities
participated  in  by the military forces of the United States in Lebanon
from June 1, 1983 to August 21,  1982  for  military  service  crediting
purposes.
  It is not possible to determine the total annual cost to the employers
of  members  of the New York State Teachers' Retirement System since the
total amount of service credit which would be claimed  under  this  bill
cannot  be  estimated.  However, the cost to the employers of members of
the New York State  Teachers'  Retirement  System  is  estimated  to  be
$21,400  per  year of service credited for Tier 1 and 2 members, $18,300
per year of service credited for Tier 3 and 4 members, $16,600 per  year
of  service  credited for Tier 5 members and $10,700 per year of service
credited for Tier 6 members if this bill is enacted.
  The source of this estimate is Fiscal Note 2013-10 dated February  20,
2013  prepared by the Actuary of the New York State Teachers' Retirement

A. 7781--B                          3

System and is intended for use only during the 2013 Legislative Session.
I, Richard A. Young, am the Actuary for the  New  York  State  Teachers'
Retirement  System.  I  am a member of the American Academy of Actuaries
and  I meet the Qualification Standards of the American Academy of Actu-
aries to render the actuarial opinion contained herein.
  FISCAL NOTE.-- Pursuant to Legislative Law, Section 50:
  PROVISIONS OF PROPOSED LEGISLATION:  The  proposed  legislation  would
amend Retirement and Social Security Law ("RSSL") section 1000 paragraph
(a)  of  subdivision  2  to  change  the  beginning  date of the Lebanon
conflict from June 1, 1983 to August 20, 1982 to match the dates  recog-
nized  by the Federal Government. This would allow any member of the New
York City Retirement Systems ("NYCRS") who had military  service  during
the  hostilities  participated  in  by the military forces of the United
States in Lebanon between August 20, 1982 and May 31, 1983 the  opportu-
nity  to obtain service credit for that period of time if other require-
ments to obtain military service credit are met.
  The Effective Date of the proposed legislation would be  the  date  of
enactment.
  The  Actuary  has  presumed  that retirees as of the enactment of this
proposed legislation would not be eligible to purchase additional  mili-
ary service provided by this proposed legislation.
  IMPACT ON BENEFITS: For purposes of the respective NYCRS, each year of
military  service  credit  purchased  would  apply  toward providing the
member with a year of   benefit accrual  under  the  particular  benefit
formula covering the member.
  The   NYCRS  include:  New  York  City  Employees'  Retirement  System
("NYCERS"), New York City Teachers' Retirement  System  ("NYCTRS"),  New
York  City  Board of Education Retirement System ("BERS"), New York City
Police Pension Fund ("POLICE") and New York Fire Department Pension Fund
("FIRE").
  In certain circumstances, the member also may be entitled  to  utilize
such  military  service  as  qualifying  service for benefit eligibility
purposes.
  For purposes of this Fiscal Note, it has been assumed that members who
purchase military service in accordance with this  proposed  legislation
would  generally  be  entitled to count such service for benefit accrual
purposes and for the purpose of qualifying for benefits.
  MEMBERS IMPACTED: Insofar as this proposed legislation relates to  the
NYCRS,  the  number  of  members who could potentially benefit from this
proposed legislation cannot be readily determined.
  For illustrative purposes only, a table is  included  in  this  Fiscal
Note  presenting the estimated financial impact per member assuming that
the affected member purchases service credit for the entire  August  20,
1982 to May 31, 1983 period.
  FINANCIAL IMPACT - OVERVIEW: With respect to an individual member, the
additional  cost  of  this  proposed  legislation  would  depend  on the
member's length of service not  including  the  military  service  being
purchased,  the  years  of military service being purchased, age, salary
history and Plan in which the member participates.
  With respect to employers participating in  the  NYCRS,  the  ultimate
employer  cost  of  this proposed legislation would be determined by the
increase in benefits to be paid, the impact of certain benefits commenc-
ing earlier, shorter working lifetimes  and  the  reduction  in  certain
future member contributions.
  FINANCIAL IMPACT - ACTUARIAL PRESENT VALUES: With respect to the NYCRS
and  based  on  the census data and assumptions herein, the enactment of

A. 7781--B                          4

this proposed legislation would increase  the  Actuarial  Present  Value
("APV")  of  benefits  ("APVB")  by  approximately  $12,500  for NYCERS,
$12,300 for NYCTRS, $6,900 for BERS, $20,800 for POLICE and $24,000  for
FIRE per year of service credit purchased as of June 30, 2012.
  In  addition,  with  respect  to  the  NYCRS, the APV of future member
contributions (primarily attributable to the payments by members of 3.0%
of salary per year of military  service  purchased)  would  increase  by
approximately  $2,000  for  NYCERS,  $2,100 for NYCTRS, $1,100 for BERS,
$3,000 for POLICE and  $3,200  for  FIRE  per  year  of  service  credit
purchased as of June 30, 2012.
  Consequently, with respect to the NYCRS, the APV of net future employ-
er  contributions  would  increase  by approximately $10,500 for NYCERS,
$10,200 for NYCTRS, $5,800 for BERS, $17,800 for POLICE and $20,800  for
FIRE per year of service credit purchased as of June 30, 2012.
  FINANCIAL  IMPACT  -  ADDITIONAL  EMPLOYER  COSTS:  Enactment  of this
proposed legislation would increase employer costs, where  such  amounts
depend on the number of members affected and upon the amount of military
service  being  credited  as well as other characteristics including the
age, salary history and Plan in which the member participates.
  With respect to the NYCRS, based on the  Actuary's  actuarial  assump-
tions  and  methods in effect as of June 30, 2012, the enactment of this
proposed legislation is estimated to increase annual employer  costs  by
approximately  $1,200  for  NYCERS,  $1,200  for  NYCTRS, $700 for BERS,
$2,100 for POLICE and  $2,500  for  FIRE  per  year  of  service  credit
purchased.
  The  real  cost of the enactment of this proposed legislation would be
the additional benefits paid.
  FINANCIAL IMPACT - ADDITIONAL EMPLOYER CONTRIBUTIONS: With respect  to
the  NYCRS,  increases  in employer contributions would depend upon when
the members purchase the military  service  permitted  by  the  proposed
legislation  and  such  service  is credited to their records, but would
ultimately be comparable to the increases in employer costs.
  FINANCIAL IMPACT - SUMMARY: The following table summarizes  the  esti-
mated  financial impact of this proposed legislation on the NYCRS assum-
ing one member in each System is eligible and purchases service for  the
period from August 20, 1982 to May 31, 1983:

        Estimated Financial Impact to Allow Members of the NYCRS
               To Purchase Certain Military Service Credit
                           as of June 30, 2012

                   (Assumes One Member in Each System
                Purchases 0.778 Years{1} of Service Each)

                              ($ Thousands)

                                                           Estimated
                                      Additional          Additional
                  Additional        APV of Future           Annual
Retirement          APV of             Employer            Employer
  System           Benefits         Contributions {2}      Costs {3}

NYCERS              $9.76               $8.20                $0.97
NYCTRS               9.58                7.91                 0.94
BERS                 5.36                4.50                 0.53

A. 7781--B                          5

POLICE              16.19               13.82                 1.64
FIRE                18.70               16.19                 1.92

  {1}  .778  years represents the length of time from August 20, 1982 to
May 31, 1983.
  {2} Equals increase in APVB minus increase in  APV  of  future  member
contributions
  {3}  Estimated Additional Annual Employer Costs are determined without
regard to the funded status of the Retirement Systems and represent  the
best  estimates  of the ultimate annual financial burden of the proposed
legislation and assume  that  any  additional  APV  of  Future  Employer
Contributions,  as they arise, are amortized as actuarial losses over 15
years (14 payments). Estimated Additional Annual Employer  Contributions
would ultimately approximate estimated Additional Annual Employer Costs.
  If  enacted  during the 2013 Legislative Session and if these affected
members and their amount of military service being credited were identi-
fied on or before June 30, 2014,  this  proposed  legislation  would  be
expected to increase employer contributions, if any, to the NYCRS begin-
ning Fiscal Year 2016.
  OTHER  COSTS:  The enactment of this proposed legislation would result
in some administrative expenses for the NYCRS and costs for Other  Post-
Employment Benefits ("OPEB").
  CENSUS DATA: The census data used for estimates of APV of benefits and
employer  contributions presented herein are the active members included
in the June 30, 2012 (Lag) actuarial valuations of NYCERS, NYCTRS, BERS,
POLICE and FIRE used to  determine  the  Preliminary  Fiscal  Year  2014
employer contributions.
  ACTUARIAL  ASSUMPTIONS AND METHODS: The additional APV of benefits and
employer contributions presented herein have been estimated as  of  June
30,  2012  on  a  hypothetical basis for illustrative purposes with each
eligible member purchasing 0.778 years of military service.
  As benefiting from the provisions  of  this  proposed  legislation  is
dependent  upon  actions  by  Plan members and the timing and amounts of
military service to be purchased are unknown, the financial impact would
likely be realized upon receipt by the Actuary of updated service credit
information.
  Consequently, changes in employer contributions  have  been  estimated
assuming  the increase in the APV of Future Employer Contributions would
be financed over a time period comparable to  that  used  for  actuarial
losses  under  the Entry Age Actuarial Cost Method. Using this approach,
the Additional APV of Future Employer Contributions would  be  amortized
over  a  closed 15-year period (14 payments under One-Year Lag Methodol-
ogy) using level dollar payments.
  ECONOMIC VALUES OF BENEFITS: The actuarial assumptions used to  deter-
mine  the financial impact of the proposed legislation discussed in this
Fiscal Note are those appropriate for budgetary models  and  determining
annual employer contributions to the NYRCS.
  However,  the  economic  assumptions  that  are  used  for determining
employer contributions do not develop risk-adjusted, economic values  of
benefits.   Such risk-adjusted, economic values of benefits would likely
differ significantly from those developed by the budgetary models.
  STATEMENT OF ACTUARIAL OPINION: I, Robert C. North, Jr., am the  Chief
Actuary  for  the New York City Retirement Systems. I am a Fellow of the
Society of Actuaries and a Member of the American Academy of  Actuaries.
I  meet the Qualification Standards of the American Academy of Actuaries
to render the actuarial opinion contained herein.

A. 7781--B                          6

  FISCAL NOTE IDENTIFICATION: This estimate is  intended  for  use  only
during  the  2013  Legislative Session. It is Fiscal Note 2013-12, dated
May 29, 2013 prepared by the Chief Actuary of the New York City  Retire-
ment Systems.