S T A T E O F N E W Y O R K
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9364--A
I N A S S E M B L Y
February 22, 2012
___________
Introduced by M. of A. ABBATE -- (at request of the New York State
Teachers' Retirement System) -- read once and referred to the Commit-
tee 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
clarifying the maximum salary which may be used to calculate the ordi-
nary death benefit of members of the public retirement systems of the
state
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Subdivision c of section 448 of the retirement and social
security law, as amended by chapter 510 of the laws of 1974, is amended
to read as follows:
c. For the purpose of this section, salary shall be the regular
compensation earned during the member's last twelve months of service in
full pay status as a member or, if he OR SHE had not completed twelve
months of service prior to the date of death, but was subject to the
provisions of subdivision b of this section, the compensation he OR SHE
would have earned had he OR SHE worked for the twelve months prior to
such date; provided, however, for the purpose of this section salary
shall exclude any form of termination pay (which shall include any
compensation in anticipation of retirement), or any lump sum payment for
deferred compensation sick leave, or accumulated vacation credit or any
other payment for time not worked (other than compensation received
while on sick leave or authorized leave of absence) and in no event
shall it exceed the maximum salary specified in section one hundred
thirty of the civil service law, AS ADDED BY PART B OF CHAPTER TEN OF
THE LAWS OF TWO THOUSAND EIGHT, OR THE MAXIMUM SALARY SPECIFIED IN
SECTION ONE HUNDRED THIRTY OF THE CIVIL SERVICE LAW, AS HEREAFTER
AMENDED, WHICHEVER IS GREATER.
S 2. Subdivision c of section 508 of the retirement and social securi-
ty law, as added by chapter 617 of the laws of 1986, is amended to read
as follows:
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD14738-02-2
A. 9364--A 2
c. For the purpose of this section, salary shall be the regular
compensation earned during the member's last twelve months of service in
full pay status as a member or, if he OR SHE had not completed twelve
months of service prior to the date of death, but was subject to the
provisions of subdivision b of this section, the compensation he OR SHE
would have earned had he OR SHE worked for the twelve months prior to
such date; provided, however, for the purpose of this section salary
shall exclude any form of termination pay (which shall include any
compensation in anticipation of retirement), or any lump sum payment for
deferred compensation sick leave, or accumulated vacation credit or any
other payment for time not worked (other than compensation received
while on sick leave or authorized leave of absence) and in no event
shall it exceed the maximum salary specified in section one hundred
thirty of the civil service law, AS ADDED BY PART B OF CHAPTER TEN OF
THE LAWS OF TWO THOUSAND EIGHT, OR THE MAXIMUM SALARY SPECIFIED IN
SECTION ONE HUNDRED THIRTY OF THE CIVIL SERVICE LAW, AS HEREAFTER
AMENDED, WHICHEVER IS GREATER.
S 3. Subdivision c of section 606 of the retirement and social securi-
ty law, as added by chapter 617 of the laws of 1986, is amended to read
as follows:
c. For the purpose of this section, salary shall be the regular
compensation earned during the member's last twelve months of service in
full pay status as a member or, if he OR SHE had not completed twelve
months of service prior to the date of death, but was subject to the
provisions of subdivision b of this section, the compensation he OR SHE
would have earned had he OR SHE worked for the twelve months prior to
such date; provided, however, for the purpose of this section salary
shall exclude any form of termination pay (which shall include any
compensation in anticipation of retirement), or any lump sum payment for
deferred compensation sick leave, or accumulated vacation credit or any
other payment for time not worked (other than compensation received
while on sick leave or authorized leave of absence) and in no event
shall it exceed the maximum salary specified in section one hundred
thirty of the civil service law, AS ADDED BY PART B OF CHAPTER TEN OF
THE LAWS OF TWO THOUSAND EIGHT, OR THE MAXIMUM SALARY SPECIFIED IN
SECTION ONE HUNDRED THIRTY OF THE CIVIL SERVICE LAW, AS HEREAFTER
AMENDED, WHICHEVER IS GREATER.
S 4. This act shall take effect immediately and shall be deemed to
have been in full force and effect on and after April 1, 2011.
FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
This bill would amend Sections 448, 508 and 606 of the Retirement and
Social Security Law to clarify the maximum salary used to calculate the
paragraph 2 death benefit for Tier 2, 3, 4 and 5 members of the New York
State Teachers' Retirement System. The maximum salary used to calculate
the paragraph 2 death benefit shall not be less than the maximum salary
specified in Section 130 of the Civil Service Law, as it was added by
part B of Chapter 10 of the Laws of 2008, or the maximum salary speci-
fied in Section 130 of the Civil Service Law, as thereafter amended,
whichever is greater. Chapter 491 of the Laws of 2011 slightly lowered
the salary limit for death benefit calculation purposes, yet the current
limit is constitutionally protected for current members.
The annual cost to the employers of members of the New York State
Teachers' Retirement System is estimated to be negligible if this bill
is enacted.
The source of this estimate is Revised Fiscal Note 2012-4 dated Janu-
ary 19, 2012 prepared by the Actuary of the New York State Teachers'
A. 9364--A 3
Retirement System and is intended for use only during the 2012 Legisla-
tive 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 Actuaries to render the actuarial opinion contained herein.
FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
This bill would clarify the maximum salary used for ordinary death
benefit calculations for Tiers 2, 3, 4 and 5 members of public retire-
ment systems. The maximum salary used to calculate the ordinary death
benefit would be the greater of the maximum salary specified in section
130 of the Civil Service Law (as added by part B of chapter 10 of the
Laws of 2008) and the maximum salary specified in section 130 of the
Civil Service Law as hereafter amended. This bill would ensure that no
members who first join a retirement system on or after the effective
date of Chapter 491 of the Laws of 2011 would receive a reduced ordinary
death benefit due to the provisions of that enactment.
If this bill is enacted, insofar as this bill affects the New York
State and Local Employees' Retirement System and the New York State and
Local Police and Fire Retirement System, the cost would be negligible.
Summary of relevant resources:
Data: March 31, 2011 Actuarial Year End File with distributions of
membership and other statistics displayed in the 2011 Report of the
Actuary and 2011 Comprehensive Annual Financial Report.
Assumptions and Methods: 2010 and 2011 Annual Report to the Comp-
troller on Actuarial Assumptions, Codes Rules and Regulations of the
State of New York: Audit and Control.
Market Assets and GASB Disclosures: March 31, 2011 New York State and
Local Retirement System Financial Statements and Supplementary Informa-
tion.
Valuations of Benefit Liabilities and Actuarial Assets: summarized in
the 2011 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 February 8, 2012, and intended for use only
during the 2012 Legislative Session, is Fiscal Note No. 2012-83 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.