S T A T E O F N E W Y O R K
________________________________________________________________________
5062
2019-2020 Regular Sessions
I N A S S E M B L Y
February 7, 2019
___________
Introduced by M. of A. ABBATE -- read once and referred to the Committee
on Governmental Employees
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
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD05171-02-9
A. 5062 2
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.
§ 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.
A. 5062 3
§ 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
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 creditable 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 within 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 Actu-
ary 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 bene-
fits. 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 from 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, 2018 actuarial valu-
ation. Distributions and other statistics can be found in the 2018
Report of the Actuary and the 2018 Comprehensive Annual Financial
Report.
A. 5062 4
The actuarial assumptions and methods used are described in the 2015,
2016, 2017 and 2018 Annual Report to the Comptroller on Actuarial
Assumptions, and the Codes, Rules and Regulations of the State of New
York: Audit and Control.
The Market Assets and GASB Disclosures are found in the March 31, 2018
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 fiscal note does not constitute a legal opinion on the viability
of the proposed change nor is it intended to serve as a substitute for
the professional judgment of an attorney.
This estimate, dated January 10, 2019, and intended for use only
during the 2019 Legislative Session, is Fiscal Note No. 2019-23,
prepared by the Actuary for the New York State and Local Retirement
System.