The New York State Senate

 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   6980
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                               May 20, 2021
                                ___________
 
 Introduced by Sen. GOUNARDES -- 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
   authorizing police/fire members of the New York city  fire  department
   pension fund to obtain credit for service as an EMT member

   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Paragraph 2 of subdivision c of section 513 of the  retire-
 ment  and  social  security  law, as added by chapter 890 of the laws of
 1976, is amended to read as follows:
   2. A (I) police/fire member shall be eligible  to  obtain  credit  for
 service  with  a public employer described in paragraph one only if such
 service, if rendered prior to July first, nineteen  hundred  seventy-six
 by  a police/fire member who was subject to article eleven of this chap-
 ter, would have been eligible for credit in the  police/fire  retirement
 system or plan involved.
   (II)  NOTWITHSTANDING  ANY  OTHER  PROVISION OF LAW TO THE CONTRARY, A
 MEMBER OF THE NEW YORK CITY FIRE DEPARTMENT PENSION FUND SUBJECT TO THIS
 ARTICLE SHALL BE ELIGIBLE TO OBTAIN CREDIT FOR ANY PERIOD  OF  ALLOWABLE
 SERVICE  RENDERED AS AN EMT MEMBER, AS SUCH TERM IS DEFINED IN PARAGRAPH
 ONE OF SUBDIVISION A OF SECTION SIX  HUNDRED  FOUR-E  OF  THIS  CHAPTER,
 WHICH  IMMEDIATELY  PRECEDES  SERVICE IN THE UNIFORMED FORCE OF THE FIRE
 DEPARTMENT AND SUCH SERVICE SHALL BE DEEMED TO  BE  IN  SERVICE  OF  THE
 UNIFORMED  FORCE  OF THE FIRE DEPARTMENT FOR PURPOSES OF ELIGIBILITY FOR
 BENEFITS AND TO DETERMINE THE AMOUNT OF BENEFITS UNDER THE NEW YORK CITY
 FIRE DEPARTMENT PENSION FUND, PROVIDED THAT SUCH MEMBER PAYS  OR  TRANS-
 FERS  INTO  THE  NEW  YORK  CITY FIRE DEPARTMENT PENSION FUND ALL MEMBER
 CONTRIBUTIONS SET FORTH IN SECTION FIVE HUNDRED SEVENTEEN OF THIS  ARTI-
 CLE PLUS INTEREST, AT A RATE OF FIVE PERCENT PER ANNUM. FOR A MEMBER WHO
 TRANSFERS  SUCH  CONTRIBUTIONS FROM THE NEW YORK CITY EMPLOYEES' RETIRE-
 MENT SYSTEM TO THE NEW YORK CITY FIRE DEPARTMENT PENSION FUND OR  FOR  A
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.

                                                            LBD07873-02-1

 S. 6980                             2
 
 MEMBER  WHO  WITHDRAWS SUCH CONTRIBUTIONS FROM THE NEW YORK CITY EMPLOY-
 EES' RETIREMENT SYSTEM, SUCH MEMBER'S MEMBERSHIP IN THE  NEW  YORK  CITY
 EMPLOYEES'  RETIREMENT  SYSTEM  SHALL  CEASE UPON SUCH TRANSFER OR WITH-
 DRAWAL AND SUCH MEMBER SHALL RETAIN NO CREDITED SERVICE IN SUCH SYSTEM.
   (III)  THE  PROVISIONS  OF THIS PARAGRAPH SHALL APPLY TO A MEMBER WITH
 TEN OR MORE YEARS OF CREDITED SERVICE IN THE NEW  YORK  CITY  EMPLOYEES'
 RETIREMENT SYSTEM, NOTWITHSTANDING THE PROVISIONS OF SECTION SIX HUNDRED
 THIRTEEN OF THIS CHAPTER OR ANY OTHER PROVISION OF LAW TO THE CONTRARY.
   § 2. This act shall take effect immediately.

 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  6980--A
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                               May 20, 2021
                                ___________
 
 Introduced by Sen. GOUNARDES -- read twice and ordered printed, and when
   printed to be committed to the Committee on Civil Service and Pensions
   --  committee  discharged,  bill amended, ordered reprinted as amended
   and recommitted to said committee
 
 AN ACT to amend the retirement and social security law, in  relation  to
   authorizing  police/fire  members of the New York city fire department
   pension fund to obtain credit for service as an EMT member
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1. Paragraph 2 of subdivision c of section 513 of the retire-
 ment and social security law, as added by chapter 890  of  the  laws  of
 1976, is amended to read as follows:
   2.  A  (I)  police/fire  member shall be eligible to obtain credit for
 service with a public employer described in paragraph one only  if  such
 service,  if  rendered prior to July first, nineteen hundred seventy-six
 by a police/fire member who was subject to article eleven of this  chap-
 ter,  would  have been eligible for credit in the police/fire retirement
 system or plan involved.
   (II) NOTWITHSTANDING ANY OTHER PROVISION OF LAW  TO  THE  CONTRARY,  A
 MEMBER OF THE NEW YORK CITY FIRE DEPARTMENT PENSION FUND SUBJECT TO THIS
 ARTICLE  SHALL  BE ELIGIBLE TO OBTAIN CREDIT FOR ANY PERIOD OF ALLOWABLE
 SERVICE RENDERED AS AN EMT MEMBER, AS SUCH TERM IS DEFINED IN  PARAGRAPH
 ONE  OF  SUBDIVISION  A  OF  SECTION SIX HUNDRED FOUR-E OF THIS CHAPTER,
 WHICH IMMEDIATELY PRECEDES SERVICE IN THE UNIFORMED FORCE  OF  THE  FIRE
 DEPARTMENT  AND  SUCH  SERVICE  SHALL  BE DEEMED TO BE IN SERVICE OF THE
 UNIFORMED FORCE OF THE FIRE DEPARTMENT FOR PURPOSES OF  ELIGIBILITY  FOR
 BENEFITS AND TO DETERMINE THE AMOUNT OF BENEFITS UNDER THE NEW YORK CITY
 FIRE  DEPARTMENT  PENSION FUND, PROVIDED THAT SUCH MEMBER PAYS OR TRANS-
 FERS INTO THE NEW YORK CITY FIRE  DEPARTMENT  PENSION  FUND  ALL  MEMBER
 CONTRIBUTIONS  SET FORTH IN SECTION FIVE HUNDRED SEVENTEEN OF THIS ARTI-
 CLE PLUS INTEREST, AT A RATE OF FIVE PERCENT PER ANNUM. FOR A MEMBER WHO
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.

                                                            LBD07873-03-1

 S. 6980--A                          2
 
 TRANSFERS SUCH CONTRIBUTIONS FROM THE NEW YORK CITY  EMPLOYEES'  RETIRE-
 MENT  SYSTEM  TO THE NEW YORK CITY FIRE DEPARTMENT PENSION FUND OR FOR A
 MEMBER WHO WITHDRAWS SUCH CONTRIBUTIONS FROM THE NEW YORK  CITY  EMPLOY-
 EES'  RETIREMENT  SYSTEM,  SUCH MEMBER'S MEMBERSHIP IN THE NEW YORK CITY
 EMPLOYEES' RETIREMENT SYSTEM SHALL CEASE UPON  SUCH  TRANSFER  OR  WITH-
 DRAWAL AND SUCH MEMBER SHALL RETAIN NO CREDITED SERVICE IN SUCH SYSTEM.
   (III)  THE  PROVISIONS  OF THIS PARAGRAPH SHALL APPLY TO A MEMBER WITH
 TEN OR MORE YEARS OF CREDITED SERVICE IN THE NEW  YORK  CITY  EMPLOYEES'
 RETIREMENT SYSTEM, NOTWITHSTANDING THE PROVISIONS OF SECTION SIX HUNDRED
 THIRTEEN OF THIS CHAPTER OR ANY OTHER PROVISION OF LAW TO THE CONTRARY.
   § 2. This act shall take effect immediately.
   FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
   SUMMARY  OF  BILL:  This  enactment  of this proposed legislation (see
 Appendix) would amend subdivision c of section 513 of the Retirement and
 Social Security Law (RSSL) to allow New  York  City  Fire  Pension  Fund
 (FIRE)  members subject to Article 14 (Tier 3, Tier 3 Modified, and Tier
 3 Enhanced) to obtain service credit for service rendered as an emergen-
 cy medical technician (EMT) with the New York City Employee's Retirement
 System (NYCERS) that immediately precedes service in FIRE.  If  properly
 transferred  or  purchased,  such  service  shall  be  deemed to be FIRE
 service for purposes of determining the eligibility for benefits and for
 determining benefit amounts.
   Effective Date: Upon enactment.
   BACKGROUND: Currently, the purchase or transfer of service rendered as
 a NYCERS EMT member does not provide an  additional  service  retirement
 benefit for FIRE members subject to Article 14.
   IMPACT  ON  BENEFITS:  Under  the  proposed legislation, eligible FIRE
 members would be able to purchase or transfer service earned as  an  EMT
 member  and  have  that  service  count  for purposes of determining the
 eligibility for benefits and for determining benefit  amounts  in  FIRE.
 Upon  attaining  eligible  service  credit  with  FIRE, the member would
 relinquish prior membership and applicable benefits with NYCERS.
   IMPACT ON PAYABILITY: Including EMT service towards eligibility  would
 increase and/or accelerate the payability date of benefits.
   MEMBER  CONTRIBUTIONS:  Eligible  FIRE  members with EMT service imme-
 diately preceding their FIRE service would have to pay, via purchase  or
 transfer  from  NYCERS, applicable Article 14 member contributions, plus
 5.0% annual interest for such purchased or transferred  service.  Member
 contributions  made as a NYCERS EMT member that exceed the amount needed
 for the applicable Article 14 contributions with interest would, if  not
 otherwise  utilized for a separate vested benefit, be refunded with 5.0%
 annual interest.
   FINANCIAL IMPACT - PRESENT VALUES: Based on the census  data  and  the
 actuarial  assumptions  and  methods  described herein, the enactment of
 this proposed legislation would increase the  Present  Value  of  Future
 Benefits  (PVFB) by approximately $13.4 million and decrease the Present
 Value of member contributions of approximately  $0.7  million.  The  net
 result  is  an increase in the Present Value of future employer contrib-
 utions of approximately $14.1 million.
   Under the Entry Age Normal cost method used to determine the  employer
 contributions  to  FIRE,  there  would  be  an  increase in the Unfunded
 Accrued Liability (UAL) of  approximately  $31.0  million  offset  by  a
 decrease  in  the  Present Value of future employer Normal Cost of $16.9
 million.
   FINANCIAL IMPACT - ANNUAL EMPLOYER CONTRIBUTIONS: In  accordance  with
 Administrative   Code   of   the   City  of  New  York  (ACCNY)  Section

 S. 6980--A                          3
 
 13-638.2(k-2), new UAL attributable to benefit changes are to  be  amor-
 tized  as  determined  by  the  Actuary but generally over the remaining
 working lifetime of those impacted by the benefit changes.  As  of  June
 30,  2020,  the  remaining  working  lifetime of the current FIRE Tier 3
 members potentially eligible to purchase EMT service is approximately 21
 years.
   For the purposes of this Fiscal Note, the increase in  UAL  was  amor-
 tized  over a 21-year period (20 payments under the One-Year Lag Method-
 ology (OYLM)) using level dollar payments.  This  payment  offset  by  a
 decrease  in  the  Normal Cost results in an increase in annual employer
 contributions of approximately $2.9 million each year. The average annu-
 al employer cost per member included in this fiscal note is approximate-
 ly $2,400 per year.
   CENSUS DATA: The estimates presented herein are based  on  the  census
 data  used  in  the  June  30, 2020 (Lag) actuarial valuation of FIRE to
 determine the Preliminary Fiscal Year 2022 employer contributions.
   There are an estimated 1,203 active FIRE Tier 3 members as of June 30,
 2020 who could potentially benefit  from  the  proposed  legislation  by
 purchasing  service earned as an EMT member. These active members had an
 average age of approximately 30.5 years, average service of approximate-
 ly 3.6 years (before purchasing any additional service), and an  average
 salary  of approximately $81,800. On average, the 1,203 active FIRE Tier
 3 members would be able to purchase 2.9 years of service  earned  as  an
 EMT  member  with  an  estimated  purchase cost of $7,700 per former EMT
 member as of June 30, 2020.
   ACTUARIAL ASSUMPTIONS AND METHODS: The changes in the Present Value of
 future  employer  contributions  and   annual   employer   contributions
 presented herein have been calculated based on the actuarial assumptions
 and  methods  in effect for the June 30, 2019 (Lag) actuarial valuations
 used to determine the Preliminary Fiscal  Year  2021  employer  contrib-
 utions of FIRE.
   The  Actuary  is proposing a set of changes for use beginning with the
 June 30, 2019 (Lag) actuarial valuations of FIRE to determine the  Final
 Fiscal  Year  2021 Employer Contributions (2021 A&M). If the 2021 A&M is
 enacted, it is estimated that it would produce PVFB and annual  employer
 contribution results that are within 1% of the results shown above.
   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 FIRE 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
 Fiscal Note.
   Not measured in this Fiscal Note are the following:
   *  The  employer  costs  for  service  purchased by future FIRE Tier 3
 members for service earned as an EMT member. However,  as  noted  above,
 the average annual employer cost per member included in this fiscal note
 is approximately $2,400 per year.
   *  The  initial,  additional  administrative  costs  to  implement the
 proposed legislation.
   * The impact of this  proposed  legislation  on  Other  Postemployment
 Benefit 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

 S. 6980--A                          4
 
 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 2021-49 dated June 10,
 2021 was prepared by the Chief  Actuary  for  the  New  York  City  Fire
 Pension  Fund.  This  estimate  is intended for use only during the 2021
 Legislative Session.