Senate Bill S4114A

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

                                 4114--A

                       2011-2012 Regular Sessions

                            I N  S E N A T E

                             March 18, 2011
                               ___________

Introduced  by  Sen.  GOLDEN -- read twice and ordered printed, and when
  printed to be committed to the Committee on Civil Service and Pensions
  -- recommitted to the Committee  on  Civil  Service  and  Pensions  in
  accordance  with  Senate  Rule 6, sec. 8 -- committee discharged, bill
  amended, ordered reprinted as amended and recommitted to said  commit-
  tee

AN ACT in relation to service credit for certain members of the New York
  city employees' retirement system

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

  Section 1. Notwithstanding any other provision of law to the contrary,
Ms. Linda Bores, Ms. Lisa Bosse and Ms. Catherine Littlefield members of
the New York city employee's retirement system and employees of the  New
York city health and hospitals corporation at Coney Island Hospital, who
were previously employed by University Group Medical Associates at Coney
Island  Hospital,  shall  be  eligible  for  credit for service at Coney
Island Hospital while employed by University Group  Medical  Associates,
provided  that  each  such  member files a claim for part or all of such
service with the retirement system within 90 days of the effective  date
of  this  act  and  contributes to the retirement system an amount which
such member would have contributed during  such  period,  together  with
interest  thereon,  and  further  provided that no additional credit for
service shall be given for any periods of service already purchased. The
amount contributed shall be pursuant to regulations adopted by the board
of trustees of the retirement system.
  S 2. This act shall take effect immediately.
  FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
  PROVISIONS OF PROPOSED LEGISLATION -  OVERVIEW:  The  proposed  legis-
lation  would  permit  Linda Bores, Lisa Bosse and Catherine Littlefield
("Eligible Members"), who are members of the New  York  City  Employees'
Retirement System ("NYCERS") employed by the Health and Hospitals Corpo-

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09344-05-2
              

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ration  ("HHC") at Coney Island Hospital who were previously employed by
University Group Medical Associates ("UGMA") at Coney  Island  Hospital,
to  be  eligible  for  credit for service at Coney Island Hospital while
employed by UGMA ("Eligible Service").
  The  Effective  Date  of the proposed legislation would be the date of
enactment.
  IMPACT ON MEMBER CONTRIBUTIONS: The Eligible Members currently partic-
ipate in the Tier IV Age Fifty-Seven Retirement Program for certain  New
York City members ("57/5 Plan").
  Under the proposed legislation, each Eligible Member would be required
to pay Basic Member Contributions ("BMC") and Additional Member Contrib-
utions ("AMC") including accrued interest at a rate of 5.0% per annum in
order to purchase Eligible Service.
  The method of payment, including the amount of periodic deduction from
payroll  and  the  time  period needed to purchase the Eligible Service,
would be prescribed by the Executive Director and approved by the  Board
of Trustees of NYCERS.
  IMPACT ON BENEFITS: The proposed legislation, if enacted, would permit
the  Eligible  Members  to  acquire  service  credit  for their Eligible
Service and would increase their expected benefits payable from NYCERS.
  FINANCIAL IMPACT - ACTUARIAL PRESENT VALUES: Based  on  the  actuarial
assumptions and methods described herein, the enactment of this proposed
legislation  would  increase  the  Actuarial  Present  Value of Benefits
("APVB") of NYCERS by approximately $760,000 as of June 30, 2010.
  In addition, the Actuarial Present  Value  ("APV")  of  future  member
contributions  would  decrease  by  approximately $40,000 as of June 30,
2010. The member contributions to buy back the prior service would equal
approximately $370,000 measured as of June 30, 2010.
  Consequently, the APV  of  net  future  employer  contributions  would
increase by approximately $430,000 as of June 30, 2010.
  FINANCIAL IMPACT - ANNUAL EMPLOYER COSTS: Based on the Actuary's actu-
arial  assumptions and methods in effect on June 30, 2010, the enactment
of this proposed legislation would increase first year  annual  employer
costs to NYCERS by approximately $60,000.
  FINANCIAL  IMPACT - EMPLOYER CONTRIBUTIONS: If enacted during the 2012
Legislative Session on or before June 30, 2012, and  if  these  Eligible
Members  elect to purchase Eligible Service, that Eligible Service would
likely first be reflected in the June 30, 2012 census data.  In  accord-
ance  with  the  One-Year  Lag  methodology  used  to determine employer
contributions, increased employer contributions would be consistent with
the increased employer costs and would be  determined  for  Fiscal  Year
2014.
  If enacted during the 2012 Legislative Session after June 30, 2012 and
on  or  before  June 30, 2013, increased employer contributions would be
determined for Fiscal Year 2015.
  CENSUS DATA: The census data used for the results presented herein was
the active data used in the June 30, 2010 (Lag) actuarial  valuation  of
NYCERS  used to determine Preliminary Fiscal Year 2012 employer contrib-
utions, supplemented by additional information provided by the  Eligible
Members.
  This  supplemental  information  indicates  that  the Eligible Members
would be  eligible  to  purchase  approximately  48  years  of  Eligible
Service.
  ACTUARIAL  ASSUMPTIONS  AND  METHODS:  The  APVB, APV of future member
contributions, APV of  future  salaries,  employer  costs  and  employer
contributions shown herein have been determined using estimated benefits

S. 4114--A                          3

and the applicable actuarial assumptions and methods currently in effect
for the June 30, 2010 (Lag) actuarial valuation of NYCERS.
  POTENTIAL  CHANGES IN ACTUARIAL ASSUMPTIONS AND METHODS: The impact of
enactment of the proposed legislation provided in this Fiscal  Note  has
been based on the continued use of the current actuarial assumptions and
methods.
  However,  the  Actuary  is currently in the process of proposing a new
package of actuarial assumptions and  methods  for  use  in  determining
employer  contributions to NYCERS for Fiscal Year 2012 and after, as the
current actuarial assumptions no longer  represent  the  Actuary's  best
estimates.
  It  it  anticipated that the proposed new package of actuarial assump-
tions and methods would likely result in a greater increase in APVB than
the amount determined under the current actuarial assumptions and  meth-
ods.    Annual employer costs and contributions would increase similarly
assuming that the prior service obligation associated with this increase
in APVB were amortized over a period comparable to that  required  under
the current actuarial methodology.
  Hence, the estimated financial impact of proposed legislation incorpo-
rating  the new package of actuarial assumptions and methods is expected
to differ from the financial impact computed using the actuarial assump-
tions and methods continued from Fiscal Year 2011.
  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 NYCERS.
  However, the economic assumptions (current and proposed) 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 of the American Academy of Actuar-
ies to render the actuarial opinion contained herein.
  FISCAL  NOTE  IDENTIFICATION:  This  estimate is intended for use only
during the 2012 Legislative Session. It is Fiscal  Note  2012-01,  dated
January  12,  2012,  prepared by the Chief Actuary for the New York City
Employees' Retirement System.