S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   10712
 
                           I N  A S S E M B L Y
 
                               July 1, 2020
                                ___________
 
 Introduced  by  COMMITTEE ON RULES -- (at request of M. of A. Abbate) --
   read once and referred to the Committee on Governmental Employees
 
 AN ACT to amend the administrative code of the  city  of  New  York,  in
   relation  to  certain lung disabilities incurred by members of the New
   York city transit authority in certain cases

   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1. The administrative code of the city of New York is amended
 by adding a new section 13-168.1 to read as follows:
   § 13-168.1 TRANSIT AUTHORITY MEMBERS; PRESUMPTION IN CERTAIN DISEASES.
 NOTWITHSTANDING ANY PROVISION OF THIS CHAPTER OR OF ANY GENERAL, SPECIAL
 OR LOCAL LAW TO THE CONTRARY, AND FOR THE PURPOSES OF THIS CHAPTER,  ANY
 CONDITION  OF  IMPAIRMENT  OF  HEALTH  CAUSED  BY  DISEASES OF THE LUNG,
 RESULTING IN TOTAL OR PARTIAL DISABILITY OR DEATH TO A MEMBER OF THE NEW
 YORK CITY TRANSIT AUTHORITY, OR A MEMBER OF ITS SUBSIDIARY  CORPORATION,
 AS  DEFINED  IN SECTION TWELVE HUNDRED THREE-A OF THE PUBLIC AUTHORITIES
 LAW, WHERE SUCH MEMBER SUCCESSFULLY PASSED  A  PHYSICAL  EXAMINATION  ON
 ENTRY  INTO SUCH SERVICE OR SUBSEQUENT THERETO, WHICH EXAMINATION FAILED
 TO REVEAL ANY EVIDENCE OF SUCH CONDITION, SHALL BE PRESUMPTIVE  EVIDENCE
 THAT IT WAS INCURRED IN THE PERFORMANCE AND DISCHARGE OF DUTY.
   § 2. This act shall take effect immediately.
   FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
   SUMMARY OF BILL: This proposed legislation would amend the Administra-
 tive  Code of the City of New York (ACCNY) to add a new Section 13-168.1
 to provide a statutory presumption to Tier 1 and Tier 2 members  of  the
 New  York  City  Employees'  Retirement  System (NYCERS) who are Transit
 Authority  employees,  and  who  become  physically  incapacitated   for
 performance of duty, or die, due to lung disease.
   In  determining  whether qualifying lung disease was caused by employ-
 ment for the Transit Authority, the diagnosis of  lung  disease,  absent
 evidence  of  such condition upon examination at hire, would be presump-
 tive evidence that such disability or death was incurred in the perform-
 ance and discharge of duty. The proposed legislation does not provide  a
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD03331-04-0

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 mechanism  for rebutting such presumption with competent evidence to the
 contrary.
   Effective Date: Upon enactment.
   FINANCIAL  IMPACT  -  OVERVIEW: There is no data available to estimate
 the number of members who might develop and become disabled  by  or  die
 from  lung  disease,  and  potentially benefit from this proposed legis-
 lation.  Therefore, the estimated financial impact has  been  calculated
 on  a  per  event  basis  equal  to the increase in the Present Value of
 Future Benefits (PVFB) for an average affected member who  is  diagnosed
 with  lung disease as the result of the enactment of the proposed legis-
 lation and who would benefit from the proposed legislation.
   In determining the increase in the PVFB, it has been assumed that 100%
 of the members who would retire with lung disease would  have  continued
 working  and  eventually retired for service if the proposed legislation
 were not passed. The increase in PVFB does  not  include  any  cost  for
 additional  death  benefits  since  the ordinary death benefit for these
 members is more valuable than  the  accidental  death  benefit  in  most
 cases.
   With  respect  to  an  individual  member, the additional cost of this
 proposed legislation varies greatly.
   FINANCIAL IMPACT - PRESENT VALUES: Based on the census  data  and  the
 actuarial  assumptions  and  methods  described herein, the enactment of
 this proposed legislation would increase the PVFB by an  amount  ranging
 from  $6,700 to $131,100 if one of the 12 members who could benefit from
 the proposed legislation develops a qualifying lung disease. The average
 increase in PVFB for the 12 members who could benefit from the  proposed
 legislation is approximately $60,100.
   FINANCIAL  IMPACT  -  ANNUAL EMPLOYER CONTRIBUTIONS: Enactment of this
 proposed legislation would increase employer contributions,  where  such
 amount  would  depend on the number of members affected as well as other
 characteristics including the age, years of service, and salary  history
 of each member.
   As  there  is  no  data  currently available to estimate the number of
 members who might be diagnosed with disabling lung disease,  the  finan-
 cial  impact  would  be  recognized  at the time of event. Consequently,
 changes in employer contributions have been estimated assuming that  the
 increase in the PVFB will be financed over the same time period used for
 actuarial  losses in accordance with Section 13-638.2(k-2) of the ACCNY.
 Using this approach, the additional  PVFB  would  be  amortized  over  a
 closed  15-year  period (14 payments under the One-Year Lag Methodology)
 using level dollar payments.
   Based on the Actuary's actuarial assumptions and methods in effect  as
 of  June  30,  2019, the enactment of this proposed legislation is esti-
 mated to increase annual employer contributions  by  an  amount  ranging
 from $800 to $15,500 if one of the 12 members who could benefit from the
 proposed  legislation  develops  a  qualifying lung disease. The average
 increase in annual employer contributions for the 12 members  who  could
 benefit  from  the  proposed  legislation  is approximately $7,100. With
 respect to the timing, increases in employer contributions would  depend
 upon  when  members  would  retire  due  to lung disease but, generally,
 increased employer contributions will first occur the second fiscal year
 following approval of the accident disability retirement.
   CENSUS DATA: The estimates presented herein are based  on  the  census
 data  used in the Preliminary June 30, 2019 (Lag) actuarial valuation of
 NYCERS to determine the Preliminary Fiscal Year 2021  employer  contrib-
 utions.

 A. 10712                            3
 
   There  are 12 active Tier 1 and Tier 2 Transit Authority employees who
 participate in NYCERS as of June 30, 2019 who could potentially  benefit
 from the proposed legislation. These 12 active Tier 1 and Tier 2 Transit
 Authority  members had an average age of approximately 71.6 years, aver-
 age  service  of  approximately  38.1  years,  and  an average salary of
 approximately $93,600. This group consisted of eight Tier 1 members, and
 four Tier 2 members.
   ACTUARIAL ASSUMPTIONS AND METHODS: The changes in the PVFB and  annual
 employer  contributions  presented  herein have been calculated based on
 the actuarial assumptions and methods in effect for the  June  30,  2019
 (Lag) actuarial valuations used to determine the Preliminary Fiscal Year
 2021 employer contributions of NYCERS.
   RISK  AND  UNCERTAINTY: The costs presented in this Fiscal Note depend
 highly on the realization of the actuarial assumptions used, as well  as
 certain  demographic  characteristics  of  NYCERS  and  other  exogenous
 factors such as investment, contribution, and  other  risks.  If  actual
 experience  deviates  from actuarial assumptions, the actual costs could
 differ from those presented herein. Costs  are  also  dependent  on  the
 actuarial  methods used, and therefore different actuarial methods could
 produce different results. Quantifying these risks is beyond  the  scope
 of this Fiscal Note.
   Not measured in this Fiscal Note are the following:
     *  The  initial, additional administrative costs of NYCERS and other
     New York City agencies to implement the proposed legislation.
     * The impact of this proposed legislation  on  Other  Postemployment
     Benefit (OPEB) costs.
   STATEMENT  OF ACTUARIAL OPINION: I, Sherry S. Chan, am the Chief Actu-
 ary for, and independent of, the New York City  Retirement  Systems  and
 Pension  Funds.  I  am a Fellow of the Society of Actuaries, an Enrolled
 Actuary under the Employee Retirement Income and Security Act of 1974, a
 Member of the American Academy of Actuaries, and a Fellow of the Confer-
 ence of Consulting Actuaries. I meet the Qualification Standards of  the
 American  Academy of Actuaries to render the actuarial opinion contained
 herein. To the best of my knowledge, the results contained  herein  have
 been prepared in accordance with generally accepted actuarial principles
 and  procedures  and  with the Actuarial Standards of Practice issued by
 the Actuarial Standards Board.
   FISCAL NOTE IDENTIFICATION: This Fiscal Note 2020-32 dated  April  28,
 2020  was prepared by the Chief Actuary for the New York City Employees'
 Retirement System. This estimate is intended for  use  only  during  the
 2020 Legislative Session.