S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  5660--A
 
                        2019-2020 Regular Sessions
 
                             I N  S E N A T E
 
                               May 10, 2019
                                ___________
 
 Introduced by Sen. GOUNARDES -- read twice and ordered printed, and when
   printed to be committed to the Committee on Civil Service and Pensions
   --  recommitted  to  the  Committee  on  Civil Service and Pensions in
   accordance with Senate Rule 6, sec. 8 --  committee  discharged,  bill
   amended,  ordered reprinted as amended and recommitted to said commit-
   tee
 
 AN ACT to amend the retirement and social security law, in  relation  to
   calculating certain pensions
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Subdivision a of section 504 of the retirement  and  social
 security  law,  as amended by chapter 18 of the laws of 2012, is amended
 to read as follows:
   a. The service  retirement  benefit  for  general  members  at  normal
 retirement  age with twenty or more years of credited service shall be a
 pension equal to one-fiftieth of final average  salary  times  years  of
 credited  service,  not in excess of thirty years, less fifty percent of
 the primary social security retirement benefit as  provided  in  section
 five  hundred eleven of this article. The service retirement benefit for
 general members at normal retirement age with twenty or  more  years  of
 service who first become members of the New York state and local employ-
 ees'  retirement  system on or after April first, two thousand twelve at
 normal retirement age shall be a pension equal to the  sum  of  [thirty-
 five] FORTY per centum and one-fiftieth of final average salary for each
 year  of service in excess of twenty, but not in excess of thirty, times
 final average salary times years of credited service.
   § 2. Subdivision b-1 of section 604 of the retirement and social secu-
 rity law, as added by chapter 18 of the laws of 2012, is amended to read
 as follows:
   b-1. Notwithstanding any other provision of law to the  contrary,  the
 service  retirement  benefit  for  members  with twenty or more years of

  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD06130-06-0

 S. 5660--A                          2
 
 credit service who first become a member of a public  retirement  system
 of  the state on or after April first, two thousand twelve at age sixty-
 three shall be a pension equal to the sum  of  [thirty-five]  FORTY  per
 centum and one-fiftieth of final average salary for each year of service
 in  excess  of twenty times final average salary times years of credited
 service. In no  event  shall  any  retirement  benefit  payable  without
 optional modification be less than the actuarially equivalent annuitized
 value  of  the  member's contributions accumulated with interest at five
 percent per annum compounded annually to the date of retirement.
   § 3. Subdivision d of section 516 of the retirement and social securi-
 ty law, as amended by chapter 18 of the laws of 2012, is amended to read
 as follows:
   d. The deferred vested benefit of general  members  in  the  uniformed
 correction  force of the New York city department of correction, who are
 not entitled to a deferred vested benefit under subdivision d of section
 five hundred four-a of this article or under subdivision  d  of  section
 five  hundred  four-b  of this article or under subdivision d of section
 five hundred four-d of this  article,  or  of  general  members  in  the
 uniformed  personnel  in  institutions  under  the  jurisdiction  of the
 department of corrections  and  community  supervision,  as  defined  in
 subdivision  i  of  section  eighty-nine of this chapter, with twenty or
 more years of credited service shall be a pension commencing  at  normal
 retirement age equal to one-fiftieth of final average salary times years
 of  credited  service, not in excess of thirty years, or for members who
 first become members of the New York state and local employees'  retire-
 ment  system  on  or  after  April first, two thousand twelve, a pension
 equal to the sum of [thirty-five] FORTY per centum and  one-fiftieth  of
 final  average  salary for each year of service in excess of twenty, but
 not in excess of thirty, times final average salary times years of cred-
 ited service. The deferred vested benefit  of  general  members  in  the
 uniformed   correction   force  of  the  New  York  city  department  of
 correction, who are not entitled to  a  deferred  vested  benefit  under
 subdivision  d  of  section five hundred four-a of this article or under
 subdivision d of section five hundred four-b of this  article  or  under
 subdivision  d  of  section  five  hundred four-d of this article, or of
 general members in the uniformed personnel in institutions under  juris-
 diction  of  the department of corrections and community supervision, as
 defined in subdivision i of section eighty-nine of  this  chapter,  with
 less than twenty years of credited service shall be a pension commencing
 at  normal  retirement age equal to one-sixtieth of final average salary
 times years of credited service. Such deferred  vested  benefit  may  be
 paid in the form of an early service retirement benefit, or may be post-
 poned until after normal retirement age, in which event the benefit will
 be  subject  to  reduction or escalation as provided in subdivision c of
 section five hundred four of this article.
   § 4. Section 1312 of the retirement and social security law, as  added
 by chapter 18 of the laws of 2012, is amended to read as follows:
   §  1312.  Benefit  enhancements.  Notwithstanding any other law to the
 contrary, eligible employees  shall  be  permitted  to  retire,  without
 penalty,  upon  reaching  age fifty-seven and completing at least thirty
 years of credited service. Employees retiring pursuant to  this  section
 shall  receive  a  pension  allowance  equal to the sum of [thirty-five]
 FORTY per centum and one-fiftieth of final average salary for each  year
 of service in excess of twenty times final average salary times years of
 credited service.

 S. 5660--A                          3

   §  5. Notwithstanding any other provision of law to the contrary, none
 of the provisions of this act shall be subject  to  section  25  of  the
 retirement and social security law.
   § 6. This act shall take effect immediately.
   FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
   This  bill  will  change  the benefit fraction for a Tier 6 member for
 service greater than 20 years to 40% of FAS plus 2% per year of  service
 greater than 20. Currently the benefit for service greater than 20 years
 is 35% of FAS plus 2% per year of service greater than 20.
   Insofar  as  this bill affects the New York State and Local Employees'
 Retirement System (NYSLERS), if this legislation is enacted  during  the
 2020  legislative  session, we anticipate that there will be an increase
 in the annual contributions of the state of New York and all participat-
 ing employers in the NYSLERS approximately 0.8% of the  compensation  of
 each affected Tier 6 member.
   In addition to the annual contributions discussed above, there will be
 a  past service cost of approximately $213 million which would be shared
 by the State of New York and all of the participating employers  in  the
 NYSLERS.  The  estimated  first  year  cost would be approximately $10.5
 million to the State of New York and approximately $15.1 million to  the
 participating employers in the NYSLERS.
   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, 2019  actuarial  valu-
 ation.    Distributions  and  other  statistics can be found in the 2019
 Report of the  Actuary  and  the  2019  Comprehensive  Annual  Financial
 Report.
   The  actuarial assumptions and methods used are described in the 2015,
 2016, 2017, 2018 and 2019 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, 2019
 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 March 23, 2020, and intended for use only during
 the 2020 Legislative Session, is Fiscal Note No.  2020-76,  prepared  by
 the Actuary for the New York State and Local Retirement System.