S T A T E O F N E W Y O R K
I N S E N A T E
March 23, 2020
Introduced by Sen. HARCKHAM -- read twice and ordered printed, and when
printed to be committed to the Committee on Civil Service and Pensions
AN ACT to amend the retirement and social security law, in relation to
the retiree earnings cap for health care officials and workers during
a declared public health related state of emergency
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Section 212 of the retirement and social security law is
amended by adding a new subdivision 4 to read as follows:
4. NOTWITHSTANDING THE EARNING LIMITATIONS FOR RETIRED PERSONS SET
FORTH IN THIS SECTION, STATE AND LOCAL GOVERNMENTS MAY HIRE RETIRED
PUBLIC HEALTH OFFICIALS AND WORKERS AT ANY REASONABLE EARNING LEVEL IN
TIMES OF A DECLARED PUBLIC HEALTH RELATED STATE OF EMERGENCY DECLARED BY
THE GOVERNOR, PROVIDED THAT SUCH RETIREES HIRED DURING SUCH STATE OF
EMERGENCY ARE HIRED AND CONTINUE TO BE EMPLOYED FOR THE PURPOSE OF
§ 2. This act shall take effect immediately.
FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
This bill would exempt from the earnings limitations set forth in
Section 212 of the Retirement and Social Security Law (RSSL) any retired
public health officials and workers rehired at any reasonable earning
level in times of a declared public health related state of emergency
declared by the Governor, provided that such retirees hired during such
state of emergency are hired and continue to be employed for the purpose
of combatting COVID-19.
Insofar as this bill affects the New York State and Local Retirement
System (NYSLRS), if this legislation is enacted during the 2020 legisla-
tive session, we expect there would be negligible additional annual
costs. However, if large numbers of retirees are hired into positions
with lucrative earning levels over long periods of time, there could be
additional annual costs which would be shared by the state of New York
and all of the participating employers in the NYSLRS.
Summary of relevant resources:
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
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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
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
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 16, 2020, and intended for use only during
the 2020 Legislative Session, is Fiscal Note No. 2020-98, prepared by
the Actuary for the New York State and Local Retirement System.
FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
SUMMARY OF BILL: This proposed legislation, as it relates to the New
York City Pension Funds and Retirement Systems (NYCRS), would amend
Retirement and Social Security Law (RSSL) Section 212 to remove the
earnings limit of certain NYCRS retirees who have returned to employment
in Public Service during a declared public health related state of emer-
Effective Date: Upon enactment.
IMPACT ON PENSION PAYMENTS: Retirees who return to Public Service and
elect to be covered under the provisions of RSSL Section 212 are permit-
ted to earn an amount not exceeding a specific dollar limit in a calen-
dar year without loss, suspension, or diminution of their retirement
allowances. Once this dollar limit is reached, the retiree's pension is
suspended for the remainder of that calendar year. Generally, there are
no earnings limitations in, or following, the calendar year in which the
retiree attains age 65.
Currently, the dollar limitation in effect for Calendar Year 2020 and
thereafter is $35,000.
Under the proposed legislation, if enacted, the RSSL Section 212 post-
retirement Public Service earnings limitation would be removed for
retired health care workers hired during a declared public heath related
state of emergency who are hired for the purpose of combatting such
public health crises.
For illustrative purposes only, the table below presents the estimated
additional retirement allowances paid if RSSL Section 212 post-retire-
ment earnings limitation were removed for various sample combinations of
post-retirement annual earnings and annual retirement allowance amounts
for those retirees who are currently employed in post-retirement public
employment and are subject to post-retirement earnings limits.
Annual Retirement Annual Post-Retirement Earnings in Calendar Year
Allowance $40,000 $50,000 $60,000
$30,000 $3,800 $9,000 $12,500
$40,000 $5,000 $12,000 $16,700
$50,000 $6,300 $15,000 $20,800
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$60,000 $7,500 $18,000 $25,000
$70,000 $8,800 $21,000 $29,200
FINANCIAL IMPACT - ANNUAL EMPLOYER CONTRIBUTIONS: In accordance with
Section 13-638.2(k-2) of the Administrative Code of the City of New York
(ACCNY), new Unfunded Accrued Liability attributable to benefit changes
are to be amortized as determined by the Actuary, but are generally
amortized over the remaining working lifetime of those impacted by the
benefit changes. However, since changes in the applicable retirement
allowances paid to NYCRS retirees under this proposed legislation are
not known in advance, the increase in pension payments due to this
legislation would be treated as an actuarial loss. These actuarial loss-
es would be amortized over a 15-year period (14 payments under the One-
Year Lag Methodology (OYLM)) using level dollar payments.
The number of NYCRS retirees who could potentially be impacted by this
proposed legislation cannot be readily determined. Actual costs would
depend on factors such as, but not limited to, the number of retirees
that benefit under the legislation and the amount of their earnings and
Note, however, that to the extent that the proposed legislation
results in the rehiring of retirees who would not have otherwise
returned to post-employment public service absent the legislation, the
legislation is anticipated to create no additional pension cost, and may
mitigate cost that would have been realized from additional pensionable
wages paid to existing NYCRS members and/or additional new hires.
CONTRIBUTION TIMING: For the purposes of this Fiscal Note, it is
assumed that the changes in the annual employer contributions would be
reflected for the first time in the June 30, 2020 actuarial valuations
of the NYCRS. In accordance with the OYLM used to determine employer
contributions, the increase in employer contributions would first be
reflected in Fiscal Year 2022.
CENSUS DATA: For purposes of analyzing the impact of the proposed
legislation, illustrative examples with various salary and retirement
allowance amounts have been provided above.
ACTUARIAL ASSUMPTIONS AND METHODS: The changes in the annual employer
contributions presented herein have been calculated based on the actuar-
ial assumptions and methods in effect for the June 30, 2019 (Lag) actu-
arial valuations used to determine the Preliminary Fiscal Year 2021
employer contributions of NYCRS.
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 NYCRS 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 meth-
ods used, and therefore different actuarial methods could produce
different results. Quantifying these risks is beyond the scope of this
Not measured in this Fiscal Note are the following:
* The initial, additional administrative costs of NYCRS 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
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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 2020-13 dated March 16,
2020 was prepared by the Chief Actuary for the New York City Retirement
Systems and Pension Funds. This estimate is intended for use only during
the 2020 Legislative Session.