senate Bill S5354

2013-2014 Legislative Session

Creates other post-employment benefit reserve funds; repealer

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Archive: Last Bill Status - In Committee


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

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Assembly Actions - Lowercase
Senate Actions - UPPERCASE
Jan 08, 2014 referred to local government
May 16, 2013 referred to local government

S5354 - Bill Details

See Assembly Version of this Bill:
A6436
Current Committee:
Law Section:
General Municipal Law
Laws Affected:
Add §6-t, rpld §6-p subs 10 & 11, Gen Muni L; amd §1950, Ed L

S5354 - Bill Texts

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Creates other post-employment benefit reserve funds; defines terms.

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BILL NUMBER:S5354

TITLE OF BILL: An act to amend the general municipal law and the
education law, in relation to the creation and funding of other
post-employment benefit reserve funds; and to repeal certain
provisions of the general municipal law relating thereto

PURPOSE: This bill authorizes boards of cooperative educational
services (BOCES) to establish other-post employment benefit (OPEB)
reserve funds.

SUMMARY OF PROVISIONS:

Section 1: Adds a new section 6-t to the general municipal law for the
establishment of other post-employment benefit (OPEB) reserve funds.

Section 2: Provides the authority for the transfer of funds into the
other post-employment benefit reserve fund.

Section 3: Repeals subdivisions 10 and 11 of section 6-p of the
general municipal law.

Section 4: Amends paragraph b of subdivision 5 of section 1950 of the
education law.

Section 5: Sets forth an immediate effective date.

EXISTING LAW: None.

JUSTIFICATION: Despite the large and increasing costs that BOCES
continue to incur each year related to employee other post-employment
benefits, they do not have the legal authority to set-aside funds for
these purposes. As a result, BOCES continue to accrue very
significant long-term financial liabilities that may reach hundreds of
millions of dollars. However, there is no statutory mechanism for
BOCES to responsibly save funds to meet these long-term costs. Recent
estimates for the cost of these long-term liabilities for
municipalities, public authorities, and school districts reach nearly
5250 billion. This bill is limited to providing the authority to BOCES
to plan for and address the looming financial liabilities of other
post-employment benefits by establishing a reserve fund.

LEGISLATIVE HISTORY: New bill.

FISCAL IMPLICATIONS: None to the state.

EFFECTIVE DATE: Immediately.

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

                                  5354

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                              May 16, 2013
                               ___________

Introduced  by Sen. FLANAGAN -- read twice and ordered printed, and when
  printed to be committed to the Committee on Local Government

AN ACT to amend the general municipal law  and  the  education  law,  in
  relation  to the creation and funding of other post-employment benefit
  reserve funds; and to repeal certain provisions of the general munici-
  pal law relating thereto

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

  Section  1.  The  general  municipal  law  is  amended by adding a new
section 6-t to read as follows:
  S 6-T. OTHER POST-EMPLOYMENT BENEFIT RESERVE FUNDS. 1. AS USED IN THIS
SECTION,
  (A) "MUNICIPAL CORPORATION" MEANS A SCHOOL DISTRICT (EXCEPT  A  SCHOOL
DISTRICT IN A CITY WITH A POPULATION OF ONE HUNDRED TWENTY-FIVE THOUSAND
OR MORE) OR A BOARD OF COOPERATIVE EDUCATIONAL SERVICES.
  (B)  "OTHER  POST-EMPLOYMENT  BENEFIT"  MEANS ANY BENEFIT OTHER THAN A
PENSION BENEFIT THAT A MUNICIPAL CORPORATION IS OBLIGATED  BY  CONTRACT,
LOCAL  LAW,  OR  STATUTE  TO  PAY  TO, OR ON BEHALF OF, AN INDIVIDUAL ON
ACCOUNT OF THAT INDIVIDUAL'S PRIOR EMPLOYMENT BY  THE  MUNICIPAL  CORPO-
RATION, INCLUDING POST-EMPLOYMENT HEALTHCARE BENEFITS, REGARDLESS OF THE
TYPE OF PLAN THAT PROVIDES THEM, BUT EXCLUDING TERMINATION BENEFITS SUCH
AS THOSE DESCRIBED IN SECTION SIX-P OF THIS ARTICLE.
  (C) "PARTICIPATING EMPLOYER" MEANS A PARTICIPATING EMPLOYER AS DEFINED
IN  SUBDIVISION TWENTY OF SECTION TWO OF THE RETIREMENT AND SOCIAL SECU-
RITY LAW OR IN SUBDIVISION TWENTY OF SECTION THREE HUNDRED TWO  OF  SUCH
LAW.
  2.  THE  GOVERNING  BOARD OF ANY MUNICIPAL CORPORATION WHICH IS ALSO A
PARTICIPATING EMPLOYER MAY ESTABLISH BY RESOLUTION A  RESERVE  FUND  FOR
THE PURPOSE OF FINANCING OTHER POST-EMPLOYMENT BENEFITS.
  3.  THERE  MAY  BE  PAID INTO AN OTHER POST-EMPLOYMENT BENEFIT RESERVE
FUND:

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09633-02-3

S. 5354                             2

  (A) SUCH AMOUNTS AS MAY BE PROVIDED THEREFOR  BY  BUDGETARY  APPROPRI-
ATION OR RAISED BY TAX THEREFOR;
  (B) SUCH REVENUES AS ARE NOT REQUIRED BY LAW TO BE PAID INTO ANY OTHER
FUND OR ACCOUNT;
  (C) SUCH OTHER FUNDS AS MAY BE LEGALLY APPROPRIATED; AND
  (D)  NOTWITHSTANDING  ANY  LAW TO THE CONTRARY, SUCH AMOUNTS AS MAY BE
TRANSFERRED FROM A RESERVE FUND ESTABLISHED PURSUANT TO  SECTION  SIX-C,
SIX-D,  SIX-E,  SIX-F,  SIX-G,  SIX-M,  SIX-N,  OR SIX-P OF THIS ARTICLE
COMPRISED OF MONEYS RAISED FROM THE SAME TAX BASE AS THE MONEYS  IN  THE
OTHER  POST-EMPLOYMENT  BENEFIT  RESERVE  FUND, OR A RESERVE FUND ESTAB-
LISHED PURSUANT TO SECTION THIRTY-SIX HUNDRED FIFTY-ONE OF THE EDUCATION
LAW, PROVIDED, THAT ANY SUCH TRANSFER SHALL ONLY BE MADE  BY  RESOLUTION
OF  THE  GOVERNING  BOARD  OF SUCH MUNICIPAL CORPORATION ADOPTED AFTER A
PUBLIC HEARING HELD ON AT LEAST FIFTEEN DAYS PRIOR PUBLISHED  NOTICE  IN
THE  OFFICIAL NEWSPAPER OF THE MUNICIPAL CORPORATION  OR, IF THE MUNICI-
PAL CORPORATION DOES NOT HAVE AN OFFICIAL NEWSPAPER,  IN  AT  LEAST  ONE
NEWSPAPER HAVING GENERAL CIRCULATION IN THE MUNICIPAL CORPORATION.
  4. THE MONEYS IN ANOTHER POST-EMPLOYMENT BENEFIT RESERVE FUND SHALL BE
DEPOSITED  AND  SECURED  IN  THE  MANNER PROVIDED BY SECTION TEN OF THIS
ARTICLE, THE GOVERNING BOARD OF SUCH MUNICIPAL CORPORATION, OR THE CHIEF
FISCAL OFFICER THEREOF IF THE GOVERNING BOARD SHALL DELEGATE  SUCH  DUTY
TO HIM OR HER, MAY INVEST THE MONEYS IN SUCH FUND IN THE MANNER PROVIDED
BY  SECTION  ELEVEN OF THIS ARTICLE, ANY INTEREST EARNED OR CAPITAL GAIN
REALIZED ON THE MONEY SO DEPOSITED  OR  INVESTED  SHALL  ACCRUE  TO  AND
BECOME PART OF SUCH FUND.
  5. THE GOVERNING BOARD OF SUCH MUNICIPAL CORPORATION BY RESOLUTION MAY
AUTHORIZE EXPENDITURES FROM ANOTHER POST-EMPLOYMENT BENEFIT RESERVE FUND
EXCEPT  AS  OTHERWISE PROVIDED BY LAW, MONEYS IN ANOTHER POST-EMPLOYMENT
BENEFIT RESERVE FUND MAY ONLY BE EXPENDED TO FINANCE OTHER  POST-EMPLOY-
MENT BENEFITS.
  6. THE GOVERNING BOARD OF SUCH MUNICIPAL CORPORATION BY RESOLUTION MAY
AUTHORIZE  THE  TRANSFER  OF A PORTION OF THE MONEYS IN ANOTHER POST-EM-
PLOYMENT BENEFIT RESERVE FUND TO A RESERVE FUND OF THE MUNICIPAL  CORPO-
RATION  ESTABLISHED  PURSUANT  TO  SECTION  SIX-C,  SIX-D, SIX-E, SIX-F,
SIX-G, SIX-M, SIX-N, OR SIX-P OF THIS ARTICLE COMPRISED OF MONEYS RAISED
FROM THE SAME TAX BASE AS THE  MONEYS  IN  THE  RETIREMENT  CONTRIBUTION
RESERVE  FUNDS,  OR A RESERVE FUND ESTABLISHED PURSUANT TO SECTION THIR-
TY-SIX HUNDRED FIFTY-ONE OF THE EDUCATION LAW, PROVIDED, THAT  ANY  SUCH
TRANSFER SHALL ONLY BE MADE BY RESOLUTION OF THE GOVERNING BOARD OF SUCH
MUNICIPAL  CORPORATION  ADOPTED  AFTER A PUBLIC HEARING HELD ON AT LEAST
FIFTEEN DAYS PRIOR PUBLISHED NOTICE IN THE  OFFICIAL  NEWSPAPER  OF  THE
MUNICIPAL  CORPORATION OR, IF THE MUNICIPAL CORPORATION DOES NOT HAVE AN
OFFICIAL NEWSPAPER, IN AT LEAST ONE NEWSPAPER HAVING GENERAL CIRCULATION
IN THE MUNICIPAL CORPORATION.
  7. THE CHIEF  FISCAL  OFFICER  OF  SUCH  MUNICIPAL  CORPORATION  SHALL
ACCOUNT  FOR  ANOTHER  POST-EMPLOYMENT BENEFIT RESERVE FUND SEPARATE AND
APART FROM ALL OTHER FUNDS OF THE MUNICIPAL CORPORATION SUCH  ACCOUNTING
SHALL  SHOW: THE SOURCE, DATE AND AMOUNT OF EACH SUM PAID INTO THE FUND;
THE INTEREST EARNED BY SUCH FUND; CAPITAL GAINS OR LOSSES RESULTING FROM
THE SALE OF INVESTMENTS OF THIS FUND; THE ORDER, PURPOSE  THEREOF,  DATE
AND AMOUNT OF EACH PAYMENT FROM SUCH FUND; THE ASSETS OF THE FUND, INDI-
CATING CASH BALANCE AND A SCHEDULE OF INVESTMENTS.
  THE  CHIEF FISCAL OFFICER, WITHIN SIXTY DAYS OF THE END OF EACH FISCAL
YEAR, SHALL FURNISH A DETAILED REPORT OF THE OPERATION AND CONDITION  OF
THIS FUND TO THE GOVERNING BOARD.

S. 5354                             3

  8.  NO  MEMBER  OF  THE  GOVERNING BOARD OF SUCH MUNICIPAL CORPORATION
SHALL:
  (A)  AUTHORIZE  A  WITHDRAWAL  FROM  AN  OTHER POST-EMPLOYMENT BENEFIT
RESERVE FUND FOR ANY PURPOSE EXCEPT AS PROVIDED IN THIS SECTION; OR
  (B) EXPEND ANY MONEY WITHDRAWN FROM SUCH FUND FOR A PURPOSE OTHER THAN
AS PROVIDED IN THIS SECTION.
  9. THE GOVERNING BOARD OF SUCH MUNICIPAL CORPORATION BY RESOLUTION MAY
DETERMINE THAT AN OTHER POST-EMPLOYMENT BENEFIT RESERVE FUND IS NO LONG-
ER NEEDED AND TERMINATE THE FUND. SUCH  RESOLUTION  SHALL  TRANSFER  ANY
MONEYS REMAINING IN SUCH FUND TO ONE OR MORE RESERVE FUNDS OF THE MUNIC-
IPAL  CORPORATION  ESTABLISHED  PURSUANT TO SECTION SIX-C, SIX-D, SIX-E,
SIX-F, SIX-I, SIX-M, SIX-N, OR SIX-P OF THIS ARTICLE COMPRISED OF MONEYS
RAISED FROM THE SAME TAX BASE AS THE MONEYS IN THE OTHER POST-EMPLOYMENT
BENEFIT RESERVE FUND, OR ONE OR MORE RESERVE FUNDS ESTABLISHED  PURSUANT
TO SECTION THIRTY-SIX HUNDRED FIFTY-ONE OF THE EDUCATION LAW.
  S  2.  Notwithstanding  any other provision of law, within 180 days of
the effective date of this act, a municipal corporation  may  by  resol-
ution  transfer  into  an  other  post-employment  benefits reserve fund
created in accordance with section 6-t of the general municipal law  any
funds previously committed or assigned by that municipal corporation for
the  purpose  of  paying  other  post-employment  benefits as defined in
section 6-t of the general municipal law, regardless of how those  funds
have been designated.
  S  3.  Subdivisions  10 and 11 of section 6-p of the general municipal
law are REPEALED.
  S 4. Paragraph b of subdivision 5 of section  1950  of  the  education
law,  as  amended by section 80-a of part A of chapter 58 of the laws of
2011, is amended to read as follows:
  b. The cost of services herein referred to shall be the  amount  allo-
cated  to  each  component  school  district by the board of cooperative
educational services to defray expenses of such board, except that  that
part of the salary paid any teacher, supervisor or other employee of the
board  of  cooperative educational services which is in excess of thirty
thousand dollars shall not be such an approved expense, and except  also
that  administrative  and clerical expenses shall not exceed ten percent
of the total expenses for  purposes  of  this  computation.  Any  gifts,
donations  or  interest  earned  by the board of cooperative educational
services or on behalf of the board of cooperative  educational  services
by  the dormitory authority or any other source shall not be deducted in
determining the cost of services  allocated  to  each  component  school
district. [Any payments made to a component school district by the board
of  cooperative  educational  services pursuant to subdivision eleven of
section six-p of the general municipal law attributable to  an  approved
cost  of service computed pursuant to this subdivision shall be deducted
from the cost of services allocated to such component school  district.]
The  expense  of  transportation  provided  by  the board of cooperative
educational services pursuant to paragraph q of subdivision four of this
section shall be eligible for aid apportioned  pursuant  to  subdivision
seven  of section thirty-six hundred two of this chapter and no board of
cooperative educational services  transportation  expense  shall  be  an
approved cost of services for the computation of aid under this subdivi-
sion. Transportation expense pursuant to paragraph q of subdivision four
of  this section shall be included in the computation of the ten percent
limitation on administrative and clerical expenses.
  S 5. This act shall take effect immediately.

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