Assembly Bill A7900A

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  7900--A
 
                        2017-2018 Regular Sessions
 
                           I N  A S S E M B L Y
 
                               May 18, 2017
                                ___________
 
 Introduced by M. of A. ABBATE -- read once and referred to the Committee
   on  Governmental  Employees -- recommitted to the Committee on Govern-
   mental Employees in accordance with Assembly Rule 3, sec. 2 -- commit-
   tee discharged, bill amended, ordered reprinted as amended and  recom-
   mitted to said committee

 AN  ACT  to  amend  the  administrative code of the city of New York, in
   relation to the pensionable earnings of first grade police officers
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  Section  14-111 of the administrative code of the city of
 New York is amended by adding two new subdivisions c and d  to  read  as
 follows:
   C.  WHEN A FIRST GRADE POLICE OFFICER SHALL HAVE SERVED IN THE RANK OF
 POLICE OFFICER FOR A PERIOD OF TWENTY-FIVE YEARS, HE OR SHE  SHALL  HAVE
 THE  SAME RIGHTS IN RESPECT TO THE POLICE PENSION FUND AS A POLICE OFFI-
 CER DESIGNATED TO ACT AS DETECTIVE OF THE THIRD  GRADE  WHO  SHALL  HAVE
 SERVED AS SUCH FOR A PERIOD OF TIME AGGREGATING TWO YEARS AT THE HIGHEST
 SALARY RATE FOR A DETECTIVE OF THE THIRD GRADE.
   D.  WHEN A FIRST GRADE POLICE OFFICER SHALL HAVE SERVED IN THE RANK OF
 POLICE OFFICER FOR A PERIOD OF THIRTY YEARS, HE OR SHE  SHALL  HAVE  THE
 SAME  RIGHTS  IN  RESPECT  TO  THE POLICE PENSION FUND AS A SERGEANT WHO
 SHALL HAVE SERVED AS SUCH FOR A PERIOD OF TIME AGGREGATING TWO YEARS  AT
 THE HIGHEST SALARY RATE FOR A SERGEANT.
   § 2. This act shall take effect immediately.
   FISCAL NOTE.-- Pursuant to Legislative Law, Section 50:
   We  have  estimated  the  impact  of  the FAS Bill, a copy of which is
 attached, on the projected employer contributions of the New  York  City
 Police  Pension  Fund. A brief summary of the new provisions is outlined
 below:
   * When a first grade police officer achieves 25 years of service, s/he
 shall be entitled to the same base pay for the  purpose  of  pensionable
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD08490-04-8

 A. 7900--A                          2
 
 earnings  as  a detective of the third grade who served in such position
 for a period of 2 years at the highest pay rate for that position.
   * When a first grade police officer achieves 30 years of service, s/he
 shall  be  entitled  to the same base pay for the purpose of pensionable
 earnings as a sergeant who served in such position for  a  period  of  2
 years at the highest pay rate for that position.
   The  table  below  summarizes the additional contributions that result
 from this bill by year.

      (in millions)
 ________________________________________
        Year              Annual Cost
 ________________________________________
        2018                 15.9
        2019                 16.7
        2020                 17.2
        2021                 17.6
        2022                 18.0
 
 Assumptions and Methods
   While it is possible that  over  time,  these  plan  provisions  could
 influence  retirement  behavior, we are unable to accurately predict the
 specific behavior,  and  therefore  have  measured  the  cost  of  these
 provisions assuming no change to the retirement rates.
   Specific  to  this  bill,  we made the following assumptions about the
 pensionable pay increases at the 25 and 30 year of service levels, based
 on information from the applicable police contracts and  pay  applicable
 to 2017:
   * Increase at 25 Years of Service is $92,183/$85,292.
   * Increase at 30 Years of Service is $106,175/$85,292.
   These  increases  are  applied to the prior 2 years of pay (for Tier 3
 and Tier 6) once the service level is achieved.
   All other assumptions used to  illustrate  the  expected  contribution
 impact  are  consistent  with our current understanding of the actuarial
 assumptions employed by the New York City Office of the Actuary.
   This assessment was made for the purpose of estimating the cost impact
 of this proposed legislation. Use of the results for other purposes  may
 not  be  applicable  and produce significantly different results. Future
 actuarial measurements may differ significantly from the  current  meas-
 urements  presented  in  this letter for a variety of reasons including:
 changes in applicable laws,  changes  in  plan  provisions,  changes  in
 assumptions, or plan experience differing from expectations.
   The  undersigned  is familiar with the immediate and long-term aspects
 of pension calculations and meets the  Qualification  Standards  of  the
 American Academy of Actuaries necessary to render the actuarial opinions
 contained herein.