S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   6591
 
                        2017-2018 Regular Sessions
 
                             I N  S E N A T E
 
                               June 6, 2017
                                ___________
 
 Introduced  by  Sen.  DILAN  -- read twice and ordered printed, and when
   printed to be committed to the Committee on Rules
 
 AN ACT to amend the retirement and social security law, in  relation  to
   allowing  members  of  the New York city transit authority twenty-five
   year and age fifty-five retirement plan to purchase credit  for  prior
   service

   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Subdivision e of section 604-b of the retirement and social
 security law is amended by adding a new paragraph 11 to read as follows:
   11. NOTWITHSTANDING ANY PROVISION OF LAW, RULE OR  REGULATION  TO  THE
 CONTRARY, ANY MEMBER WHO IS A CURRENT MEMBER OF THE NEW YORK CITY TRANS-
 IT AUTHORITY TWENTY-FIVE YEAR AND AGE FIFTY-FIVE RETIREMENT PLAN AUTHOR-
 IZED IN THIS SECTION:
   (I)  WHOSE  NAME  WAS INCLUDED ON A PREFERRED ELIGIBLE LIST DURING ANY
 PERIOD OCCURRING ON OR AFTER MAY ELEVENTH, TWO THOUSAND TEN  AND  ON  OR
 PRIOR TO JULY TWENTY-FIFTH, TWO THOUSAND TWELVE, BY REASON OF THE ABOLI-
 TION  OF  A  POSITION  HELD BY HIM OR HER WITH THE NEW YORK CITY TRANSIT
 AUTHORITY; AND
   (II) WHO WAS A MEMBER OR FORMER MEMBER AT THE TIME  WHEN  HIS  OR  HER
 NAME WAS PLACED ON SUCH LIST;
 SHALL  BE  PERMITTED  TO  CONTRIBUTE TO SUCH RETIREMENT PLAN, THE AMOUNT
 WHICH HE OR SHE WOULD HAVE CONTRIBUTED TO SUCH SYSTEM FOR  THE  DURATION
 OF TIME HIS OR HER NAME WAS INCLUDED ON SUCH LIST, TOGETHER WITH REGULAR
 INTEREST  ON  SUCH  AMOUNT,  AND  THE  LENGTH OF CREDITED TIME FOR WHICH
 CONTRIBUTIONS ARE MADE PURSUANT TO THIS PARAGRAPH SHALL BE  CREDITED  AS
 ALLOWABLE  SERVICE  IN THE TRANSIT AUTHORITY PLAN UNDER THIS SECTION FOR
 ALL PURPOSES, INCLUDING ELIGIBILITY FOR BENEFITS.
   § 2. This act shall take effect immediately.
   FISCAL NOTE.--PROVISIONS OF PROPOSED LEGISLATION: The proposed  legis-
 lation  would  amend  Retirement  and Social Security Law (RSSL) Section
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD10265-02-7

 S. 6591                             2
 
 604-b to permit eligible New  York  City  Employees'  Retirement  System
 (NYCERS)  members  in  the  Tier  4  or  Tier 6 Twenty-Five Year and Age
 Fifty-Five Retirement  Program  for  New  York  City  Transit  Authority
 Members  (Transit  25/55  Plan)  to  purchase  certain furlough time for
 Allowable Service credit in the Plan.
   The Effective Date of the proposed legislation would be  the  date  of
 enactment.
   To be eligible to purchase furlough time, an individual must:
   * be a current NYCERS Transit 25/55 Plan member,
   *  have been on a preferred eligible list anytime on and after May 11,
 2010 to July 25, 2012, inclusive, because of the abolition of his or her
 position by the Transit Authority, and
   * have been a member or former member of the Transit 25/55 Plan at the
 time his or her name was placed on such list.
   In order to receive Allowable Service  credit  in  the  Transit  25/55
 Plan,  an  eligible  member  must  make  any applicable contributions to
 NYCERS, with interest, for the period of  eligible  furlough  time.  The
 period  of purchased furlough time shall be considered Allowable Service
 in the Transit Authority for all purposes in  the  Transit  25/55  Plan,
 including eligibility for and calculation of benefits.
   For  purposes of this Fiscal Note, it is assumed that eligible Transit
 25/55 Plan Members who purchase applicable furlough time would be ineli-
 gible to receive service credit in any public retirement  system  within
 the State including NYCERS, for the same period of time.
   FINANCIAL  IMPACT  -  ACTUARIAL PRESENT VALUES: With respect to NYCERS
 and 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) by approximately $1,180,000. In
 addition , there would be a decrease  in  the  APV  of  Future  Employee
 Contributions  of  $6,000, resulting in an increase in the APV of Future
 Employer Contributions of $1,186,000.
   FINANCIAL IMPACT - ANNUAL EMPLOYER  CONTRIBUTIONS:In  accordance  with
 the  Administrative  Code  of  the  City  of  New  York  (ACNY)  Section
 13.638.2(k-2), new UAAL attributable to benefit changes are to be  amor-
 tized  as  determined  by  the  Actuary but generally over the remaining
 working lifetime of those impacted by the benefit changes.  As  of  June
 30,  2016,  the  remaining  working  lifetime  of  the transit Authority
 members that would be impacted by the proposed legislation  is  approxi-
 mately 13 years.
   With  respect to NYCERS based on the actuarial assumptions and methods
 used in the Preliminary June 30, 2016 valuations of NYCERS,  the  enact-
 ment  of  this  proposed  legislation  would  increase  annual  employer
 contributions by approximately $160,000 per  year  beginning  in  Fiscal
 Year 2019.
   OTHER  COSTS:  Not measured in this Fiscal Note are the initial, addi-
 tional administrative costs of NYCERS and other New York  City  agencies
 to implement the proposed legislation.
   CENSUS  DATA:  The  starting  census  data  used  for the calculations
 presented herein is the census data used in  the  Preliminary  June  30,
 2016  (Lag) actuarial valuation of NYCERS. This data was supplemented by
 additional service data provided by NYCERS  for  156  Transit  Authority
 employees  who  would  benefit under the proposed legislation. These 156
 members had an average age of approximately  46.7,  average  service  of
 approximately  10.3  years  (11.1  years  after  reflecting  purchase of
 furlough time if the proposed legislation is enacted),  and  an  average
 salary of approximately $68,000.

 S. 6591                             3
 
   ACTUARIAL  ASSUMPTIONS  AND  METHODS: The additional employer contrib-
 utions presented herein have been  calculated  based  on  the  actuarial
 assumptions  and  methods  used to determine the Preliminary Fiscal Year
 2018 employer contributions of NYCERS.
   Employer  contributions  under current methodology have been estimated
 assuming the additional APVB would be  financed  through  future  normal
 contributions  including an amortization of the new UAAL attributable to
 this proposed legislation over a 13-year period (12 payments  under  the
 One-Year Lag Methodology).
   STATEMENT  OF ACTUARIAL OPINION: I, Sherry S. Chan, am the Chief Actu-
 ary for, and independent of, the New York City Pension Funds and Retire-
 ment Systems. I am a Fellow of the Society of Actuaries, a Fellow of the
 Conference of Consulting Actuaries and a Member of the American  Academy
 of Actuaries. I meet the Qualification Standards of the American Academy
 of Actuaries to render the actuarial opinion contained herein.
   FISCAL  NOTE  IDENTIFICATION:  This  Fiscal  Note 2017-15 dated May 9,
 2017, was prepared by the Chief Actuary for the New York City Employees'
 Retirement System. This estimate is intended for  use  only  during  the
 2017 Legislative Session.