S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  5246--A
     Cal. No. 847
 
                        2019-2020 Regular Sessions
 
                             I N  S E N A T E
 
                              April 18, 2019
                                ___________
 
 Introduced  by  Sens.  GOUNARDES,  LIU,  ORTT  -- read twice and ordered
   printed, and when printed to be committed to the Committee  on  Cities
   -- reported favorably from said committee, ordered to first and second
   report,  ordered  to  a  third reading, amended and ordered reprinted,
   retaining its place in the order of third reading
 
 AN ACT to amend the general municipal law, in relation  to  disabilities
   of certain retired firefighters caused by cancer
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Section 207-kk of the general municipal law,  as amended by
 chapter 531 of the laws of 2003, is amended to read as follows:
   § 207-kk. Disabilities of firefighters in  certain  cities  caused  by
 cancer.  Notwithstanding  any  other  provisions  of this chapter to the
 contrary, any condition of impairment of health caused by (i) any condi-
 tion  of  cancer  affecting  the  lymphatic,  digestive,  hematological,
 urinary, neurological, breast, reproductive, or prostate systems or (ii)
 melanoma  resulting  in  total  or partial disability or death to a paid
 member of a fire department in a city with a population of  one  million
 or  more,  OR ANY RETIRED MEMBER OF SUCH DEPARTMENT WHO HAS BEEN RETIRED
 FOR FIVE OR LESS YEARS, who successfully passed a  physical  examination
 on  entry  into the service of such department, 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 unless the
 contrary be proved by competent evidence. The provisions of this section
 shall  remain  in  full force and effect [to and including the thirtieth
 day of June, two thousand five] PURSUANT TO SECTION FOUR HUNDRED  EIGHTY
 OF THE RETIREMENT AND SOCIAL SECURITY LAW.
   §  2.  The  board  of  trustees  of  the New York City fire department
 pension fund shall take appropriate administrative action  to  implement
 the intent of section one of this act.
   § 3. This act shall take effect immediately.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
              

                       [ ] is old law to be omitted.
                                                            LBD11238-02-9

 S. 5246--A                          2
 
   FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
   SUMMARY OF BILL: This proposed legislation would amend General Munici-
 pal Law (GML) Section 207-kk to allow retirees of the New York City Fire
 Pension Fund (FIRE) who become disabled from an enumerated cancer within
 five years of retirement use of the Cancer Bill presumptions.
   Effective Date: Upon enactment.
   BACKGROUND:  Currently,  the  Cancer  Bill presumption only applies to
 active members of FIRE. The presumption is that the enumerated disabling
 cancer resulted from an accident on the  job,  but  the  presumption  of
 causation  can  be rebutted by evidence to the contrary. If the presump-
 tion is not rebutted by the Medical Board, the member is  granted  acci-
 dental disability benefits.
   FINANCIAL IMPACT - PRESENT VALUES: There is no data available to esti-
 mate  the  number  of  members  who might develop and become disabled by
 cancer within five years of retirement,  and  potentially  benefit  from
 this proposed legislation. Therefore, the estimated financial impact has
 been  calculated on a per-event basis equal to the increase in the Pres-
 ent Value of Future Benefits (PVFB) for an average member who  is  diag-
 nosed  with cancer as the result of the enactment of the proposed legis-
 lation.
   With respect to an individual member,  the  additional  cost  of  this
 proposed legislation could vary greatly depending on the member's length
 of service, age, and salary history.
   Based  on  the  census  data and the actuarial assumptions and methods
 described herein, the  enactment  of  this  proposed  legislation  would
 increase the PVFB by approximately $420,000, on average, for each occur-
 rence of cancer within five years of retirement.
   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 the member.
   As  there  is  no  data  currently available to estimate the number of
 members who might  be diagnosed with cancer within five years of retire-
 ment, the financial 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 a time
 period used under the current amortization period for actuarial  losses.
 Using  this  approach,  the  additional  PVFB  would be amortized over a
 closed 15-year period (14 payments under the  One-Year  Lag  Methodology
 (OYLM) using level dollar payments.
   Based  on the Actuary's actuarial assumptions and methods in effect as
 of June 30, 2018, the enactment of this proposed  legislation  is  esti-
 mated to increase annual employer contributions by approximately $50,000
 for  each Accidental Disability Retirement (ADR) reclassification due to
 cancer within five years of retirement.  With  respect  to  the  timing,
 increases in employer contributions would depend upon when members would
 be  reclassified,  but  generally, increased employer contributions will
 first occur the second fiscal year following approval of the ADR.
   OTHER COSTS: Not measured in this Fiscal Note are the following:
   * The initial, additional administrative costs of FIRE and  other  New
 York City agencies to implement the proposed legislation.
   *  The  impact  of  this  proposed legislation on Other Postemployment
 Benefit (OPEB) costs.
   * The cost of any potential Special  Accidental  Death  Benefits  paid
 pursuant to GML Section 208-f.

 S. 5246--A                          3

   *  The  potential  Line-of-Duty  Death  benefits paid to beneficiaries
 should the member die within five years of retirement.
   CENSUS  DATA:  The  estimates presented herein are based on the census
 data used in the Preliminary June 30, 2018 (Lag) actuarial valuation  of
 FIRE  to  determine  the  Preliminary Fiscal Year 2020 employer contrib-
 utions.
   There are 103 FIRE members who retired for service during Fiscal  Year
 2018  with  an average age of approximately 56 years, average service of
 approximately  29  years,  average  annual  pension   of   approximately
 $123,500,  plus a Variable Supplements Fund (VSF) payment of $12,000 per
 year.
   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,  2018
 (Lag) actuarial valuations used to determine the Preliminary Fiscal Year
 2020  employer  contributions  of  FIRE.  Also, based on the analysis of
 World Trade Center disabilities from 2001 to 2017, it was estimated that
 the ADR benefits are approximately 40% greater than the service  retire-
 ment benefits.
   RISK  AND  UNCERTAINTY: The costs presented in this Fiscal Note depend
 highly on the actuarial assumptions and methods used and are subject  to
 change  based  on  the realization of potential investment, demographic,
 contribution, and other risks. If actual experience deviates from  actu-
 arial  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.
   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 2019-29 dated May 31,
 2019 was prepared by the Chief  Actuary  for  the  New  York  City  Fire
 Pension  Fund.  This  estimate  is intended for use only during the 2019
 Legislative Session.