S T A T E O F N E W Y O R K
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10610
I N A S S E M B L Y
July 6, 2022
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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 retirement and social security law, in relation to
enacting the "police and fire employees retention act"
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Short title. This act shall be known and may be cited as
the "police and fire employees retention act".
§ 2. Legislative findings. Over the past several years, increased
workloads on our police and fire employees throughout the state has
resulted in a large reduction in personnel resources due to retirement
and separation from service. The loss of talented and experienced
personnel in these important job titles further results in a structural
deficit of experienced trainers for our next generation of dedicated
police and fire personnel actively entering their public service lives.
This legislation seeks to induce talented and experienced personnel to
remain in service to the public while allowing their pension payments to
be deferred during a specific period of time while they continue employ-
ment.
§ 3. The retirement and social security law is amended by adding a new
section 381-c to read as follows:
§ 381-C. DEFERRED RETIREMENT OPTION PLAN PAYABLE TO MEMBERS OF
OPTIONAL TWENTY-YEAR RETIREMENT PLAN. A PARTICIPATING EMPLOYER WHICH HAS
ELECTED OR WHICH ELECTS, PURSUANT TO SECTION THREE HUNDRED EIGHTY-ONE
AND ANY SECTIONS UNDER THIS ARTICLE, WHO PARTICIPATES IN A TWENTY-YEAR
RETIREMENT PLAN SHALL PROVIDE FOR A DEFERRED RETIREMENT OPTION PLAN.
A. DEFERRED RETIREMENT OPTION PLAN, (HEREINAFTER REFERRED TO AS
"DROP"), IS A RETIREMENT PLAN UNDER WHICH AN ELIGIBLE MEMBER MAY ELECT
TO PARTICIPATE, DEFERRING RECEIPT OF RETIREMENT BENEFITS WHILE CONTINU-
ING EMPLOYMENT. FOR THE PURPOSES OF THIS SECTION, AN "ELIGIBLE MEMBER"
IS ANY MEMBER OR OFFICER EMPLOYED BY THE STATE, LOCAL, MUNICIPAL, COUN-
TY, VILLAGE, AUTHORITY OR DIVISION WITHIN THE STATE. DURING THE PERIOD
OF CONTINUED EMPLOYMENT, THE ELIGIBLE MEMBER'S MONTHLY RETIREMENT BENE-
FIT SHALL BE DEFERRED AND HELD BY THE RETIREMENT SYSTEM ON BEHALF OF THE
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD15442-01-2
A. 10610 2
MEMBER PLUS INTEREST AT AN EFFECTIVE RATE OF ONE AND ONE-HALF PERCENT
FOR THE SPECIFIC PERIOD OF PARTICIPATION IN DROP AS PROVIDED IN SUBDIVI-
SION C OF THIS SECTION. UPON COMPLETION OF THE DROP PERIOD, THE ELIGIBLE
MEMBER SHALL RECEIVE THE TOTAL AMOUNT OF RETIREMENT BENEFITS DEFERRED
UNDER DROP WITHOUT OPTIONAL MODIFICATION AS PERMITTED BY SUBDIVISIONS D
AND E OF THIS SECTION AND SHALL BEGIN TO RECEIVE THE PREVIOUSLY DETER-
MINED NORMAL SERVICE RETIREMENT BENEFIT WITH OPTIONAL MODIFICATION AS
FURTHER PROVIDED IN SUBDIVISION D OF THIS SECTION.
B. ANY ELIGIBLE MEMBER WHO IS CURRENTLY EMPLOYED PURSUANT TO SECTION
THREE HUNDRED EIGHTY-ONE AND ANY OR ALL SUBDIVISIONS THEREUNDER AND
QUALIFIES TO RETIRE PURSUANT TO SECTION THREE HUNDRED EIGHTY-ONE OF THIS
TITLE BY REASON OF COMPLETING TWENTY YEARS OF CREDITABLE SERVICE MAY
ELECT TO PARTICIPATE IN DROP.
C. SUCH ELECTION MUST BE ON A FORM SUPPLIED BY THE RETIREMENT SYSTEM
AND MAY BE FOR ANY PERIOD OF TIME NOT LESS THAN TWELVE MONTHS OR MORE
THAN SIXTY MONTHS DURATION. ANY MEMBER WHO ELECTS TO PARTICIPATE IN DROP
IS CONSIDERED RETIRED ON THE DAY FOLLOWING THE EXPIRATION OF THE DROP
PERIOD. PROVIDED, HOWEVER, THAT ALL LOANS AND EXCESS CONTRIBUTIONS MUST
BE RESOLVED BY THE DATE OF ENTRY INTO DROP AND NO ADDITIONAL LOANS OR
EXCESS CONTRIBUTIONS SHALL BE PERMITTED AFTER THE DATE OF ENTRY INTO
DROP. UPON EXPIRATION OF THE TIME PERIOD SELECTED BY THE ELIGIBLE
MEMBER, SUCH MEMBER'S PARTICIPATION IN DROP SHALL TERMINATE.
D. (1) EFFECTIVE WITH THE DATE OF PARTICIPATION IN DROP, THE ELIGIBLE
MEMBER'S NORMAL SERVICE RETIREMENT BENEFIT SHALL BE CALCULATED, USING
CREDITABLE SERVICE AND FINAL AVERAGE SALARY AS IF THE EFFECTIVE DATE OF
RETIREMENT WAS THE DATE OF ENTRY INTO DROP. THE AMOUNT DEFERRED PURSUANT
TO DROP SHALL BE CALCULATED BASED UPON THE ELIGIBLE MEMBER'S ZERO OPTION
RETIREMENT ALLOWANCE UNTIL SUCH MEMBER HAS OBTAINED THE APPLICABLE MAXI-
MUM SERVICE RETIREMENT LIMIT BASED UPON YEARS OF SERVICE. ANY ADDITIONAL
PARTICIPATION IN DROP AFTER A MEMBER HAS OBTAINED THE MAXIMUM SERVICE
RETIREMENT LIMIT BASED UPON YEARS OF SERVICE SHALL BE CALCULATED BASED
UPON SIXTY PERCENT OF THE MEMBER'S FULL ANNUAL RETIREMENT ALLOWANCE. IN
ADDITION, FOR THE PURPOSES OF THIS SECTION, THE ANNUAL RETIREMENT ALLOW-
ANCE FOR ANY MEMBER ELECTING DROP SHALL BE CALCULATED USING A THREE-YEAR
FINAL AVERAGE SALARY AS DEFINED ELSEWHERE IN THIS ARTICLE. THE ELIGIBLE
MEMBER SHALL, HOWEVER, ELECT HIS OR HER OPTIONAL RETIREMENT BENEFIT AT
THE COMPLETION OF THE DROP PERIOD.
(2) IF THE ELIGIBLE MEMBER DIES PRIOR TO COMPLETION OF THE PERIOD OF
PARTICIPATION IN DROP, THE ELIGIBLE MEMBER SHALL BE TREATED AS IF SUCH
DROP ELECTION DID NOT EXIST. IN LIEU OF THE DROP PAYMENT, A DEATH BENE-
FIT SHALL BE PAYABLE CONSISTENT WITH THE TERMS OF THIS CHAPTER AND ALL
SALARY AND SERVICE REPORTED FOR SUCH ELIGIBLE MEMBER DURING THE DROP
PERIOD SHALL BE CONSIDERED IN CALCULATING THE ELIGIBLE MEMBER'S DEATH
BENEFIT.
(3) IF THE ELIGIBLE MEMBER IS APPROVED FOR DISABILITY BENEFITS
PROVIDED IN THIS CHAPTER DURING THE DROP PERIOD, THE ELIGIBLE MEMBER
SHALL BE TREATED AS IF THE DROP ELECTION DID NOT EXIST. IN LIEU OF THE
DROP PAYMENT, A DISABILITY RETIREMENT BENEFIT SHALL BE PAYABLE CONSIST-
ENT WITH THE TERMS OF THIS CHAPTER AND ALL SALARY AND SERVICE REPORTED
FOR SUCH ELIGIBLE MEMBER DURING THE DROP PERIOD SHALL BE CONSIDERED IN
CALCULATING THE ELIGIBLE MEMBER'S DISABILITY RETIREMENT BENEFIT.
(4) IF AN ELIGIBLE MEMBER OTHERWISE FAILS TO COMPLETE HIS OR HER PERI-
OD OF SERVICE AS ELECTED PURSUANT TO SUBDIVISION C OF THIS SECTION, THE
ELIGIBLE MEMBER SHALL BE TREATED AS IF SUCH DROP ELECTION DID NOT EXIST.
IN LIEU OF THE DROP PAYMENT, THE NORMAL SERVICE RETIREMENT BENEFIT SHALL
BE PAYABLE CONSISTENT WITH THE TERMS OF THIS CHAPTER AND ALL SALARY AND
A. 10610 3
SERVICE REPORTED FOR SUCH ELIGIBLE MEMBER DURING THE DROP PERIOD SHALL
BE CONSIDERED IN CALCULATING THE ELIGIBLE MEMBER'S SERVICE RETIREMENT
BENEFIT.
(5) IF AN ELIGIBLE MEMBER REMAINS EMPLOYED AFTER HIS OR HER PARTIC-
IPATION IN DROP IS TERMINATED, SUCH MEMBER SHALL FORFEIT ALL DROP BENE-
FITS AND CONTINUE EMPLOYMENT AS IF SUCH DROP ELECTION DID NOT EXIST.
SUCH MEMBER SHALL THEN BE ELIGIBLE TO ELECT DROP CONSISTENT WITH THE
TERMS OF THIS SECTION.
(6) IF AN ELIGIBLE MEMBER IS APPROVED FOR DISABILITY BENEFITS AFTER
BENEFITS PAYABLE PURSUANT TO DROP HAVE BEEN PAID, THE ELIGIBLE MEMBER
MAY ELECT TO RECEIVE THE DISABILITY BENEFITS IN LIEU OF DROP BENEFITS,
BUT SUCH DISABILITY BENEFITS MUST BE ACTUARIALLY ADJUSTED FOR ANY BENE-
FITS PAID UNDER DROP.
E. AT THE CONCLUSION OF THE MEMBER'S PARTICIPATION IN DROP, THE
RETIREMENT SYSTEM SHALL PAY THE DEFERRED SERVICE RETIREMENT BENEFITS IN
ONE OF THE FOLLOWING METHODS AS ELECTED BY THE MEMBER:
(1) ALL ACCRUED DROP BENEFITS, PLUS INTEREST, LESS WITHHOLDING AS
REQUIRED BY THE INTERNAL REVENUE SERVICE, SHALL BE PAID TO THE DROP
PARTICIPANT OR ELIGIBLE BENEFICIARY OR AS OTHERWISE DETERMINED BY OPERA-
TION OF LAW;
(2) ALL ACCRUED DROP BENEFITS, PLUS INTEREST, SHALL BE PAID FROM THE
RETIREMENT SYSTEM TO A CUSTODIAN OF THE ELIGIBLE RETIREMENT PLAN OR
OTHER ELIGIBLE PLAN OR ACCOUNT AS PROVIDED PURSUANT TO THE INTERNAL
REVENUE CODE AS DIRECTED BY THE MEMBER OR ELIGIBLE BENEFICIARY;
(3) A PORTION OF THE DROP BENEFITS SHALL BE PAID TO THE DROP PARTIC-
IPANT OR ELIGIBLE BENEFICIARY, LESS WITHHOLDING REQUIRED BY THE INTERNAL
REVENUE SERVICE AND THE REMAINING DROP BENEFITS MAY BE ROLLED OVER AS
OTHERWISE PERMITTED BY THE INTERNAL REVENUE CODE. FOR PURPOSES OF THIS
SUBDIVISION, THE TERM "ELIGIBLE BENEFICIARY" IS ONE WHO QUALIFIES TO
ROLLOVER BENEFITS FROM A QUALIFIED BENEFIT PLAN OR ACCOUNT AS PROVIDED
BY THE INTERNAL REVENUE CODE.
THE FORMS OF PAYMENT PROVIDED BY THIS SUBDIVISION MUST COMPLY WITH THE
MINIMUM DISTRIBUTION REQUIREMENTS OF THE INTERNAL REVENUE CODE.
F. THE COMPTROLLER SHALL PRESCRIBE SUCH REGULATIONS AS MAY BE REQUIRED
FOR THE EFFECTIVE ADMINISTRATION AND IMPLEMENTATION OF THE PROVISIONS OF
THIS SECTION.
§ 4. This act shall take effect immediately.