senate Bill S5162B

Amended

Allows a change in retirement options for certain retired members with the consent of the nominated survivor beneficiary

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Bill Status


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor
view actions

actions

  • 13 / May / 2013
    • REFERRED TO CIVIL SERVICE AND PENSIONS
  • 30 / May / 2013
    • AMEND AND RECOMMIT TO CIVIL SERVICE AND PENSIONS
  • 30 / May / 2013
    • PRINT NUMBER 5162A
  • 06 / Jun / 2013
    • AMEND AND RECOMMIT TO CIVIL SERVICE AND PENSIONS
  • 06 / Jun / 2013
    • PRINT NUMBER 5162B
  • 18 / Jun / 2013
    • COMMITTEE DISCHARGED AND COMMITTED TO RULES
  • 18 / Jun / 2013
    • ORDERED TO THIRD READING CAL.1450
  • 18 / Jun / 2013
    • PASSED SENATE
  • 18 / Jun / 2013
    • DELIVERED TO ASSEMBLY
  • 18 / Jun / 2013
    • REFERRED TO GOVERNMENTAL EMPLOYEES
  • 08 / Jan / 2014
    • DIED IN ASSEMBLY
  • 08 / Jan / 2014
    • RETURNED TO SENATE
  • 08 / Jan / 2014
    • REFERRED TO CIVIL SERVICE AND PENSIONS
  • 05 / May / 2014
    • AMEND (T) AND RECOMMIT TO CIVIL SERVICE AND PENSIONS
  • 05 / May / 2014
    • PRINT NUMBER 5162C
  • 19 / May / 2014
    • 1ST REPORT CAL.789
  • 20 / May / 2014
    • 2ND REPORT CAL.
  • 21 / May / 2014
    • ADVANCED TO THIRD READING
  • 02 / Jun / 2014
    • PASSED SENATE
  • 02 / Jun / 2014
    • DELIVERED TO ASSEMBLY
  • 02 / Jun / 2014
    • REFERRED TO GOVERNMENTAL EMPLOYEES

Summary

Allows a change in retirement options for certain retired members of the New York state teachers' retirement system or the New York city teachers' retirement system with the consent of the nominated survivor beneficiary.

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Bill Details

Versions:
S5162
S5162A
S5162B
S5162C
Legislative Cycle:
2013-2014
Current Committee:
Law Section:
Retirement and Social Security Law
Laws Affected:
Amd §§514 & 610, R & SS L; amd §539, Ed L

Sponsor Memo

BILL NUMBER:S5162B

TITLE OF BILL: An act to amend the retirement and social security law
and the education law, in relation to permitting certain retired
members of the New York State Teachers' Retirement System or the New
York City Teachers' Retirement System to change their retirement
options with the consent of the nominated survivor beneficiary

PURPOSE: Allows a change in the retirement options for retired members
of the New York State Teachers' Retirement System (NYSTRS) or the New
York City Teachers' Retirement System (NYCTRS) with the consent of the
nominated survivor beneficiary.

SUMMARY OF PROVISIONS:

§ 1 - amends § 514 of the Retirement and Social Security Law by adding
a new subdivision e to provide for the option of post-retirement
beneficiary changes with nominated survivors consent for members of
NYCTRS.

§ 2 amends § 610 of the Retirement and Social Security Law by adding a
new subdivision g to provide for the option of post-retirement
beneficiary changes with nominated survivors consent for members of
NYCTRS.

§ 3 - amends § 539 of the Education Law by adding a new subdivision 8
to provide for the option of post-retirement beneficiary changes with
nominated survivors consent for members of NYSTRS.

§ 4 - This legislation shall take effect on June 30, 2013, except that
if this act shall take effect after this date it shall be deemed to
have been in full force and effect on or after June 30, 2013.

EXISTING LAW: Under NYC Administrative Code 13-565 (c) - Tier I and
Tier II retired members of NYCTRS are provided this option with
consent of the nominated beneficiary. This bill would expand this
option to retirees in all tiers of NYCTRS and NYSTRS with the same
nominated beneficiary consent.

JUSTIFICATION: Since divorce has become fairly commonplace with
nearly 50 percent of all marriages ending in divorce -the concept of
an unchangeable option of providing a lifelong benefit to the spouse
of a member of a retirement system is no longer suitable.

Current law is punitive in nature for any retiree whose marriages
dissolve after retirement options have been chosen. Requiring that a
divorced spouse continue to pay toward the maintenance of a spouse
that may agree to give up this compensation is an unnecessary drain on
resources of the member of the retirement system.

Much the same way both parties are allowed to agree to legally end
their marriage, these same adults should be given the option to
reverse this retirement decision as their marital situation changes.

For the aforementioned reasons and in light of the fact that this
option already being permitted to certain members of the NYCTRS this
option should be expanded to all members of NYCTRS and NYSTRS.


LEGISLATIVE HISTORY: New Legislation for the 2012 Session - S.7610 -
referred to Civil Service and Pensions with no further action.

FISCAL IMPLICATIONS: NYCTRS -To the extent that the probabilities of
survival of the retiree and the beneficiary designated under the
optional form of benefit have not changes significantly since such
optional form of benefit was instituted, then the enactment of this
proposed legislation is expected to result in little or no change in
the Actuarial Present Value of Benefits or in employer costs. It will
result in some administrative expenses for NYCTRS.

NYSTRS - The annual cost to the employers of members of the NYSTRS for
this benefit is estimated to be very low, likely less than $200,000
per year.

EFFECTIVE DATE: This legislation shall take effect on June 30, 2013,
except that if this act shall take effect after this date it shall be
deemed to have been in full force and effect on or after June 30,
2013.

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

                                 5162--B

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                              May 13, 2013
                               ___________

Introduced  by  Sen.  SAVINO -- read twice and ordered printed, and when
  printed to be committed to the Committee on Civil Service and Pensions
  -- committee discharged, bill amended, ordered  reprinted  as  amended
  and  recommitted  to  said  committee  --  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 permitting certain retired members of the New York
  State  Teachers'  Retirement  System  or  the  New York City Teachers'
  Retirement System to change their retirement options with the  consent
  of the nominated survivor beneficiary

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

  Section 1. Section 514 of the retirement and social  security  law  is
amended by adding a new subdivision e to read as follows:
  E.  NOTWITHSTANDING ANY OTHER PROVISION OF LAW, WHERE A RETIRED MEMBER
OF THE NEW YORK CITY TEACHERS' RETIREMENT SYSTEM HAS  NOMINATED  HIS  OR
HER  SPOUSE  AS  THE  SURVIVOR BENEFICIARY UNDER OPTION ONE, TWO OR FIVE
PROVIDED FOR IN SUBDIVISION A OF THIS SECTION, AND SUCH PERSON SO  NOMI-
NATED  CEASES  BY  CAUSES OTHER THAN DEATH TO BE HIS OR HER SPOUSE OR IS
SEPARATED FROM HIM OR HER, OR IF SUCH OPTION  WAS  SELECTED  IN  CONTEM-
PLATION  OF  MARRIAGE WHICH HAS NOT TAKEN PLACE, THEN THE BOARD OF TRUS-
TEES OF SUCH RETIREMENT SYSTEM SHALL HAVE THE AUTHORITY  TO  PERMIT  THE
CHANGE  OF  SUCH  OPTION  TO  THE  MAXIMUM BENEFIT THAT IS THE ACTUARIAL
EQUIVALENT BY AND WITH THE CONSENT OF ALL PARTIES.
  S 2. Section 610 of the retirement and social security law is  amended
by adding a new subdivision g to read as follows:
  G.  NOTWITHSTANDING ANY OTHER PROVISION OF LAW, WHERE A RETIRED MEMBER
OF THE NEW YORK CITY TEACHERS' RETIREMENT SYSTEM HAS  NOMINATED  HIS  OR
HER  SPOUSE  AS  THE  SURVIVOR BENEFICIARY UNDER OPTION ONE, TWO OR FIVE
PROVIDED FOR IN SUBDIVISION A OF THIS SECTION, AND SUCH PERSON SO  NOMI-

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD10230-07-3

S. 5162--B                          2

NATED  CEASES  BY  CAUSES OTHER THAN DEATH TO BE HIS OR HER SPOUSE OR IS
SEPARATED FROM HIM OR HER, OR IF SUCH OPTION  WAS  SELECTED  IN  CONTEM-
PLATION  OF  MARRIAGE WHICH HAS NOT TAKEN PLACE, THEN THE BOARD OF TRUS-
TEES  OF  SUCH  RETIREMENT SYSTEM SHALL HAVE THE AUTHORITY TO PERMIT THE
CHANGE OF SUCH OPTION TO THE  MAXIMUM  BENEFIT  THAT  IS  THE  ACTUARIAL
EQUIVALENT BY AND WITH THE CONSENT OF ALL PARTIES.
  S  3.  Section  539  of  the  education law is amended by adding a new
subdivision 8 to read as follows:
  8. NOTWITHSTANDING ANY OTHER PROVISION OF LAW, A  RETIREE  SUBJECT  TO
THIS ARTICLE OR ARTICLE FOURTEEN OR FIFTEEN OF THE RETIREMENT AND SOCIAL
SECURITY  LAW  WHO  AT  RETIREMENT  HAD  DULY SELECTED AN OPTION FORM OF
RETIREMENT PROVIDING FOR THE PAYMENT OF A  LESSER  RETIREMENT  ALLOWANCE
OVER  THE LIFE OF THE RETIREE WITH THE PROVISION THAT UPON THE RETIREE'S
DEATH ALL OR A PORTION OF SUCH ALLOWANCE SHALL BE CONTINUED FOR THE LIFE
OF AND PAID TO A BENEFICIARY DULY NOMINATED BY THE  RETIREE  AT  RETIRE-
MENT, SHALL BE PERMITTED TO RESCIND SUCH SELECTION WITHIN ONE YEAR AFTER
SUCH  BENEFICIARY  HAS  CEASED TO BE THE RETIREE'S SPOUSE BY REASON OF A
FINAL JUDGMENT OR DECREE OF DIVORCE  ISSUED  BY  A  COURT  OF  COMPETENT
JURISDICTION.  IN ORDER TO RESCIND SUCH SELECTION, THE RETIREE AND BENE-
FICIARY MUST EACH FILE A WRITTEN CONSENT TO SUCH CHANGE WITH THE  SYSTEM
ON  A  FORM PRESCRIBED BY THE SYSTEM. UPON SATISFACTORILY RECEIVING SUCH
JUDGMENT OR DECREE OF DIVORCE AND SUCH CONSENTS, ANY AND ALL OBLIGATIONS
OF THE SYSTEM TO THE BENEFICIARY UNDER THE  RETIREE'S  OPTION  SELECTION
SHALL BE TOTALLY DISCHARGED AND THE RETIREE SHALL THEREAFTER BE PAID FOR
THE  REMAINDER  OF  SUCH  RETIREE'S LIFE THE MAXIMUM SINGLE LIFE BENEFIT
WHICH WOULD HAVE BEEN PAYABLE, HAD THE RETIREE MADE NO OPTION  SELECTION
AT  THE  TIME OF RETIREMENT. THE RETIREMENT BOARD IS AUTHORIZED TO ADOPT
SUCH RULES AND REGULATIONS AS MAY BE NECESSARY TO IMPLEMENT THIS  SUBDI-
VISION.
  S  4.  This  act  shall take effect immediately and shall be deemed to
have been in full force and effect on or after June 30, 2013.
  FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
  This proposed legislation would amend Retirement and  Social  Security
Law  ("RSSL") Sections 514 and 610 to allow certain Tier III and Tier IV
retirees of the New York City Teachers' Retirement  System  ("TRS")  the
opportunity to change certain optional forms of benefit after retirement
similar  to  the provisions set forth in Administrative Code of the City
of New York ("ACNY") Section 565(c).
  ACNY Section 565(c) covers only Tier I and Tier II members of TRS.
  In addition, for purposes of this Fiscal Note, the  references  herein
to Tier IV include those TRS members whose dates of membership are on or
after April 1, 2013 (a.k.a., Tier VI members).
  Specifically,  this  proposed  legislation  would permit a Tier III or
Tier IV retiree of TRS who has nominated his or her spouse as the survi-
vor beneficiary to change, under certain optional forms of  benefit  and
with the consent of his or her spouse and the TRS Retirement Board, from
the  optional  form  of benefit originally chosen to the maximum benefit
that is the actuarial equivalent, if such person:
  (1) ceases by causes other than death to be his or her spouse, or
  (2) is separated from him or her, or
  (3) if such option was selected in contemplation of marriage which has
not taken place.
  The Effective Date of the proposed legislation would be  the  date  of
enactment.
  FINANCIAL  IMPACT  -  ACTUARIAL PRESENT VALUE OF BENEFITS AND EMPLOYER
CONTRIBUTIONS: To the extent that the probabilities of survival  of  the

S. 5162--B                          3

retiree  and the beneficiary designated under the optional form of bene-
fit have not changed significantly since such optional form  of  benefit
was  instituted,  then  the  enactment  of  this proposed legislation is
expected to result in little or no change in the Actuarial Present Value
of  Benefits,  Employer  Normal  Cost,  Actuarial  Accrued  Liability or
employer contributions to TRS.
  OTHER COSTS: The enactment of this proposed legislation  would  result
in some administrative expenses for TRS.
  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  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 No. 2013-03,
dated February 28, 2013 prepared by the Chief Actuary of  the  New  York
City Teachers' Retirement System.
  FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
  This  bill  would  amend  Section  539 of the Education Law to allow a
retired member  of  the  New  York  State  Teachers'  Retirement  System
(NYSTRS)  who  has  selected an optional form of retirement benefit that
provides that upon the retired member's death, all, or a percentage  of,
such  retirement  benefit shall be continued for the life of a benefici-
ary, to rescind the selection of such option within one year after  such
beneficiary  ceases  to  be  the  retired member's spouse by reason of a
final judgment or decree of divorce. In order to rescind  such  optional
form of retirement benefit, the retired member and beneficiary must each
file  a  written  consent  with respect to such change with NYSTRS. Upon
NYSTRS' receipt of the judgment or decree of  divorce  and  the  written
consents,  the  retired  member  would  receive  the maximum single-life
retirement benefit for the remainder of his or her lifetime,  as  if  no
option  had  been  selected  at  retirement.  Any and all obligations of
NYSTRS to the beneficiary under the option selection shall be considered
fully discharged. This bill shall apply to retirement  benefits  payable
on or after June 30, 2013.
  The  annual  cost  to  the  employers of members of the New York State
Teachers' Retirement System for this benefit is  estimated  to  be  very
low,  likely  less  than  $200,000 per year. Allowing retired members to
change the terms of their option after retirement creates the  potential
for anti-selection however.
  The  source  of  this  estimate is Fiscal Note 2013-18 dated April 23,
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.

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