S T A T E   O F   N E W   Y O R K
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                                  7326

                       2015-2016 Regular Sessions

                          I N  A S S E M B L Y

                               May 6, 2015
                               ___________

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

AN  ACT authorizing Robert Cosenza to apply for Tier II pension benefits
  in 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,
Robert  Cosenza,  who  joined  the  New  York city employees' retirement
system as a Tier II, Plan C member on April 24, 1974 and then left  city
service  on  October 23, 2000, who for reasons not ascribable to his own
negligence, failed to timely file the appropriate form to withdraw  from
Plan C and enter Plan D to become eligible for a vested retirement plan,
shall  be  deemed  to  have  timely  filed  his withdrawal form and have
entered Plan D, if on or before December  31,  2015  he  shall  file  an
application  therefor  with  the  New  York  city  employees' retirement
system.
  S 2. This act shall take effect immediately.
  FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
  PROVISIONS OF PROPOSED LEGISLATION:  The  proposed  legislation  would
authorize  the  New York City Employees' Retirement System ("NYCERS") to
accept an application from Robert Cosenza to switch  from  the  Modified
Career Pension Plan ("Plan C") to the Modified 55-Year Increased Service
Fractional Plan ("Plan D").
  BACKGROUND: Mr. Cosenza became a Tier II member of NYCERS on April 24,
1974 and elected to participate in NYCERS Plan C.
  Administrative  Code  of  the City of New York ("ACNY") Section 13-173
provides that an individual must be a member of Plan D at  the  time  of
discontinuance  from  city-service  in order to be eligible for a vested
benefit under Plan D. Since Mr. Cosenza never filed the appropriate form
to withdraw from Plan C and switch to Plan D, he is not eligible  for  a
vested  benefit and he is only eligible to receive a return of his accu-

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD08435-02-5
              

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mulated member contributions which have been paid  to  him  in  a  check
dated March 22, 2007.
  The proposed legislation, if enacted, would authorize NYCERS to accept
an application from Mr. Cosenza on or before December 31, 2015 to switch
from  Plan  C  to  Plan  D  as if it had been filed prior to his date of
resignation.
  The Effective Date of the proposed legislation would be  the  Date  of
Enactment.
  FINANCIAL  IMPACT  - ACTUARIAL PRESENT VALUES: The estimated financial
impact has been calculated as the sum of (1)  the  prospective  benefits
plus  (2)  the  retroactive  benefits  Mr. Cosenza would receive if this
proposed legislation were enacted.
  If the legislation were to be enacted, Mr. Cosenza would  be  entitled
to  a  pension  of approximately $21,000 per year beginning September 7,
2014 (age 62) under the maximum payout option. If the  legislation  were
not enacted, Mr. Cosenza would only be entitled to a refund of his accu-
mulated member contributions which he has already received.
  Based  on  the actuarial assumptions and methods described herein, the
enactment of this proposed  legislation  would  increase  the  Actuarial
Present  Value  ("APV")  of Benefits ("APVB") and the Unfunded Actuarial
Accrued Liability ("UAAL") of NYCERS by  approximately  $250,000  as  of
June 30, 2015, calculated as (1) plus (2);
  (1) APV of future pension payments beginning July 2015 of approximate-
ly $233,000.
  (2)  Accumulated  value of retroactive pension payments from September
2014 through June 2015 of approximately $17,000.
  FINANCIAL IMPACT - ANNUAL EMPLOYER CONTRIBUTIONS AND  ANNUAL  EMPLOYER
COSTS:  In  accordance  with Section 13.638.2(k-2) of the Administrative
Code of the City of New York ("ACNY"), new UAAL attributable to  benefit
changes  are  to be amortized as determined by the Actuary but generally
over the remaining working lifetime of those  impacted  by  the  benefit
changes.
  For  this  proposed legislation, Mr. Cosenza is inactive and therefore
the entire increase in UAAL as of June 30, 2015 of $250,000 based on the
Actuary's current actuarial assumptions and methods should be recognized
in the first year for contribution purposes.
  The increase in employer costs would be comparable to the increase  in
employer contributions.
  CONTRIBUTION  TIMING:  If  enacted during the 2015 Legislative Session
and if his application for switching to Plan D were filed on  or  before
June  30,  2015,  his  status  as a Plan D Retiree would likely first be
reflected in the June 30, 2015 census data. In accordance 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 2017.
  If enacted during the 2015 Legislative Session, and if his application
for switching to Plan D were filed after June 30, 2015 but on or  before
June  30,  2016,  his  status  as a Plan D Retiree would likely first be
reflected in the June  30,  2016  census  data  and  increased  employer
contributions would be determined for Fiscal Year 2018.
  ACTUARIAL  ASSUMPTIONS  AND  METHODS:  The  additional  APVB  and UAAL
presented herein have been calculated based on the actuarial assumptions
and methods in effect for the June 30, 2013 (Lag)  actuarial  valuations
used to determine Fiscal Year 2015 employer contributions of NYCERS.
  ECONOMIC  VALUES OF BENEFITS: The actuarial assumptions used to deter-
mine the financial impact of the proposed legislation discussed in  this

A. 7326                             3

Fiscal  Note  are those appropriate for budgetary models and determining
annual employer contributions to NYCERS.
  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 Acting
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 Actuar-
ies. I meet the Qualification Standards of the American Academy of Actu-
aries to render the actuarial opinion contained herein.
  FISCAL NOTE IDENTIFICATION: This estimate is  intended  for  use  only
during  the  2015  Legislative Session. It is Fiscal Note 2015-22, dated
April 22, 2015 prepared by the Acting Chief Actuary  for  the  New  York
City Employees' Retirement System.