S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   8789
 
                             I N  S E N A T E
 
                               May 18, 2018
                                ___________
 
 Introduced  by  Sen.  AKSHAR -- read twice and ordered printed, and when
   printed to be committed to the Committee on Civil Service and Pensions
 
 AN ACT to amend the retirement and social security law, in  relation  to
   the  calculation  of  past  service credit for members in the title of
   deputy sheriff transferring between  the  New  York  state  and  local
   employees'  retirement  system  to the New York state and local police
   and fire retirement system
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  Section  43  of the retirement and social security law is
 amended by adding a new subdivision m to read as follows:
   M. 1. NOTWITHSTANDING ANY OTHER LAW, RULE OR REGULATION TO THE CONTRA-
 RY, ANY MEMBER IN THE TITLE OF DEPUTY SHERIFF TRANSFERRING FROM THE  NEW
 YORK  STATE AND LOCAL EMPLOYEES' RETIREMENT SYSTEM TO THE NEW YORK STATE
 AND LOCAL POLICE AND FIRE RETIREMENT SYSTEM AFTER THE EFFECTIVE DATE  OF
 THIS  SUBDIVISION AND ANY MEMBER PREVIOUSLY IN THE TITLE OF DEPUTY SHER-
 IFF HAVING MADE SUCH TRANSFER SHALL BE ENTITLED TO  A  DETERMINATION  OF
 THE  AMOUNT OF SERVICE CREDIT THAT IS ELIGIBLE ON A TWENTY YEAR OR TWEN-
 TY-FIVE YEAR RETIREMENT PLAN IF, WITHIN ONE YEAR OF THE DATE ON WHICH HE
 OR SHE FIRST BECAME A MEMBER OF THE NEW YORK STATE AND LOCAL POLICE  AND
 FIRE  RETIREMENT SYSTEM OR WITHIN ONE YEAR OF THE EFFECTIVE DATE OF THIS
 SUBDIVISION, SUCH MEMBER ELECTS TO DO SO.  IF  THE  MEMBER  SUBSEQUENTLY
 TRANSFERS  BACK  TO  THE  NEW YORK STATE AND LOCAL EMPLOYEES' RETIREMENT
 SYSTEM, THE FULL AMOUNT OF SERVICE CREDIT EARNED WHILE IN THE  TITLE  OF
 DEPUTY SHERIFF SHALL BE TRANSFERRED BACK TO THE NEW YORK STATE AND LOCAL
 EMPLOYEES' RETIREMENT SYSTEM.
   2.  THE  CALCULATION OF THE AMOUNT OF SUCH SERVICE CREDIT FOR A MEMBER
 WILL BE DETERMINED BY MULTIPLYING THE ELIGIBLE SERVICE CREDITED  IN  THE
 NEW  YORK  STATE AND LOCAL EMPLOYEES' RETIREMENT SYSTEM PLAN BY A SALARY
 MULTIPLIER, REFLECTING THE RATE OF SALARY IN  THE  NEW  YORK  STATE  AND
 LOCAL  EMPLOYEES'  RETIREMENT SYSTEM PLAN RELATIVE TO THE RATE OF SALARY
 IN THE NEW YORK STATE AND LOCAL POLICE AND FIRE RETIREMENT SYSTEM  PLAN,
 AND  A BILLING RATE MULTIPLIER, REFLECTING THE ACTUARIAL LONG-TERM AVER-
 AGE BILLING RATE IN THE NEW YORK STATE AND LOCAL  EMPLOYEES'  RETIREMENT
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
              

                       [ ] is old law to be omitted.
                                                            LBD15447-03-8

 S. 8789                             2
 
 SYSTEM  PLAN RELATIVE TO THE ACTUARIAL LONG-TERM AVERAGE BILLING RATE IN
 THE NEW YORK STATE AND LOCAL POLICE AND FIRE RETIREMENT SYSTEM PLAN. THE
 DETERMINATION OF THE SALARY MULTIPLIER AND BILLING RATE MULTIPLIER  WILL
 BE  DETERMINED BY THE ACTUARY OF THE NEW YORK STATE AND LOCAL EMPLOYEES'
 RETIREMENT SYSTEM AND THE NEW YORK  STATE  AND  LOCAL  POLICE  AND  FIRE
 RETIREMENT  SYSTEM. THE AMOUNT OF SUCH SERVICE CREDITED TO THE MEMBER IN
 THE NEW YORK STATE AND LOCAL POLICE  AND  FIRE  RETIREMENT  SYSTEM  PLAN
 SHALL NOT EXCEED THE AMOUNT OF SERVICE CREDITED TO THE MEMBER IN THE NEW
 YORK STATE AND LOCAL EMPLOYEES' RETIREMENT SYSTEM PLAN.
   §  2. Section 343 of the retirement and social security law is amended
 by adding a new subdivision i to read as follows:
   I. 1. NOTWITHSTANDING ANY OTHER LAW, RULE OR REGULATION TO THE CONTRA-
 RY, ANY MEMBER IN THE TITLE OF DEPUTY SHERIFF TRANSFERRING FROM THE  NEW
 YORK  STATE AND LOCAL EMPLOYEES' RETIREMENT SYSTEM TO THE NEW YORK STATE
 AND LOCAL POLICE AND FIRE RETIREMENT SYSTEM AFTER THE EFFECTIVE DATE  OF
 THIS  SUBDIVISION AND ANY MEMBER PREVIOUSLY IN THE TITLE OF DEPUTY SHER-
 IFF HAVING MADE SUCH TRANSFER SHALL BE ENTITLED TO  A  DETERMINATION  OF
 THE  AMOUNT OF SERVICE CREDIT THAT IS ELIGIBLE ON A TWENTY YEAR OR TWEN-
 TY-FIVE YEAR RETIREMENT PLAN IF, WITHIN ONE YEAR OF THE DATE ON WHICH HE
 OR SHE FIRST BECAME A MEMBER OF THE NEW YORK STATE AND LOCAL POLICE  AND
 FIRE  RETIREMENT SYSTEM OR WITHIN ONE YEAR OF THE EFFECTIVE DATE OF THIS
 SUBDIVISION, SUCH MEMBER ELECTS TO DO SO.  IF  THE  MEMBER  SUBSEQUENTLY
 TRANSFERS  BACK  TO  THE  NEW YORK STATE AND LOCAL EMPLOYEES' RETIREMENT
 SYSTEM, THE FULL AMOUNT OF SERVICE CREDIT EARNED WHILE IN THE  TITLE  OF
 DEPUTY  SHERIFF  SHALL  BE  TRANSFERRED BACK TO NEW YORK STATE AND LOCAL
 EMPLOYEES' RETIREMENT SYSTEM.
   2. THE CALCULATION OF THE AMOUNT OF SUCH SERVICE CREDIT FOR  A  MEMBER
 WILL  BE  DETERMINED BY MULTIPLYING THE ELIGIBLE SERVICE CREDITED IN THE
 NEW YORK STATE AND LOCAL EMPLOYEES' RETIREMENT SYSTEM PLAN BY  A  SALARY
 MULTIPLIER,  REFLECTING  THE  RATE  OF  SALARY IN THE NEW YORK STATE AND
 LOCAL EMPLOYEES' RETIREMENT SYSTEM PLAN RELATIVE TO THE RATE  OF  SALARY
 IN  THE NEW YORK STATE AND LOCAL POLICE AND FIRE RETIREMENT SYSTEM PLAN,
 AND A BILLING RATE MULTIPLIER, REFLECTING THE ACTUARIAL LONG-TERM  AVER-
 AGE  BILLING  RATE IN THE NEW YORK STATE AND LOCAL EMPLOYEES' RETIREMENT
 SYSTEM PLAN RELATIVE TO THE ACTUARIAL LONG-TERM AVERAGE BILLING RATE  IN
 THE NEW YORK STATE AND LOCAL POLICE AND FIRE RETIREMENT SYSTEM PLAN. THE
 DETERMINATION  OF THE SALARY MULTIPLIER AND BILLING RATE MULTIPLIER WILL
 BE DETERMINED BY THE ACTUARY OF THE NEW YORK STATE AND LOCAL  EMPLOYEES'
 RETIREMENT  SYSTEM  AND  THE  NEW  YORK  STATE AND LOCAL POLICE AND FIRE
 RETIREMENT SYSTEM. THE AMOUNT OF SUCH SERVICE CREDITED TO THE MEMBER  IN
 THE  NEW  YORK  STATE  AND  LOCAL POLICE AND FIRE RETIREMENT SYSTEM PLAN
 SHALL NOT EXCEED THE AMOUNT OF SERVICE CREDITED TO THE MEMBER IN THE NEW
 YORK STATE AND LOCAL EMPLOYEES' RETIREMENT SYSTEM PLAN.
   3. IF THE MEMBER SUBSEQUENTLY RETIRES ON AN AGE BASED RETIREMENT  PLAN
 IN  THE  NEW  YORK  STATE  AND  LOCAL  POLICE AND FIRE RETIREMENT SYSTEM
 INSTEAD OF A TWENTY YEAR OR TWENTY-FIVE YEAR PLAN, THE  FULL  AMOUNT  OF
 SERVICE  CREDIT  EARNED  WHILE  IN  THE TITLE OF DEPUTY SHERIFF SHALL BE
 GRANTED.
   4. NO MEMBER WHO RECEIVES SERVICE CREDIT PURSUANT TO THIS  SUBDIVISION
 SHALL  BE  ELIGIBLE  TO  RECEIVE  ADDITIONAL  SERVICE CREDIT PURSUANT TO
 SUBDIVISION B OF SECTION THREE HUNDRED EIGHTY FOUR-E OF THIS ARTICLE  IF
 HIS OR HER EMPLOYER HAS ELECTED TO PROVIDE SUCH SERVICE CREDIT.
   §  3. This act shall take effect on the sixtieth day after an internal
 revenue service ruling stating that the transfer and crediting of deputy
 sheriff service credit from the New  York  state  and  local  employees'
 retirement  system  into  the  New  York state and local police and fire

 S. 8789                             3
 
 retirement system special retirement plan by this act is  allowable  and
 does  not  jeopardize such retirement system's tax-qualified status, and
 shall remain in full force and effect only as long as such  transfer  is
 authorized  pursuant  to  the  provisions  of the internal revenue code;
 provided, that the state comptroller shall notify the  legislative  bill
 drafting  commission  upon  the  occurrence  of such ruling and upon any
 change in the provisions of the  internal  revenue  code  affecting  the
 provisions  of  this  act  in  order that the commission may maintain an
 accurate and timely effective data base of the official text of the laws
 of the state of New York in furtherance of effecting the  provisions  of
 section  44  of the legislative law and section 70-b of the public offi-
 cers law.
   FISCAL NOTE.-- Pursuant to Legislative Law, section 50:
   This bill will expand the definition of credible service under 20-year
 and 25-year plans (special plans) in the New York State and Local Police
 and Fire Retirement System (PFRS) to include service  credit  earned  in
 the  New  York  State  and  Local Employees' Retirement System (ERS) for
 those individuals previously employed in the title of Deputy Sheriff. To
 be eligible for the service credit, an individual must be  a  member  of
 PFRS and elect to transfer the ERS service credit to the PFRS plan with-
 in 12 months of first joining PFRS, or within 12 months of the effective
 date  of  the  bill,  whichever  is  later. The amount of service credit
 granted in the PFRS special plan will be calculated by  The  Actuary  of
 the  New York State and Local Retirement Systems (NYLSRS), not to exceed
 the service credited under the ERS plan.
   Internal Revenue Service (IRS)  plan  qualification  issues:  granting
 service  credit  towards  retirement  in  a 20 year plan in the New York
 State and Local Police and Fire Retirement System (PFRS) for  employment
 that  was  not  rendered  in  the  PFRS  could jeopardize the Retirement
 System's governmental plan  status  and  its  exemption  from  Employees
 Retirement Income Security Act (ERISA). This development could result in
 the loss of qualified status, which would mean the loss of tax benefits.
 This  result  would  substantially impair the System's value to our more
 than one million participants.
   This legislation will not become  effective  until  NYLSRS  obtains  a
 favorable  ruling  from  the IRS stating that these provisions would not
 harm the qualification status of the System. Further, the provisions  of
 this  legislation  will  only continue in full force and effect while so
 authorized by the IRS. It is estimated  that  the  costs  to  obtain  an
 initial  ruling  would  be $28,000 for the services of the IRS, and $800
 per hour for legal consultants.
   In addition to the costs to obtain a ruling for the IRS stated  above,
 if  this bill is enacted, there will be an administrative cost to imple-
 ment the provisions of this legislation.
   All costs will be shared and spread by the participating employers  in
 PFRS.
   Summary of relevant resources:
   The  membership  data  used  in  measuring  the impact of the proposed
 change was the same as that used in the March 31, 2017  actuarial  valu-
 ation.    Distributions  and  other  statistics can be found in the 2017
 Report of the  Actuary  and  the  2017  Comprehensive  Annual  Financial
 Report.
   The  actuarial assumptions and methods used are described in the 2015,
 2016, and 2017 Annual Report to the  Comptroller  on  Actuarial  Assump-
 tions,  and  the  Codes  Rules and Regulations of the State of New York:
 Audit and Control.

 S. 8789                             4
 
   The Market Assets and GASB Disclosures are found in the March 31, 2017
 New York State and Local  Retirement  System  Financial  Statements  and
 Supplementary Information.
   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  May 10, 2018, and intended for use only during
 the 2018 Legislative Session, is Fiscal Note No.  2018-99,  prepared  by
 the Actuary for the New York State and Local Retirement System.