Senate Bill S9115

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   9115
 
                             I N  S E N A T E
 
                               May 10, 2022
                                ___________
 
 Introduced by Sens. MAYER, AKSHAR -- 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  calculation  of  past  service credit for members in the title of
   deputy sheriff transferring between  the  New  York  state  and  local
   employees'  retirement  system  to the New York state and local police
   and fire retirement system
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  Section  43  of the retirement and social security law is
 amended by adding a new subdivision m to read as follows:
   M. 1. NOTWITHSTANDING ANY OTHER LAW, RULE OR REGULATION TO THE CONTRA-
 RY, ANY MEMBER IN THE TITLE OF DEPUTY SHERIFF TRANSFERRING FROM THE  NEW
 YORK  STATE AND LOCAL EMPLOYEES' RETIREMENT SYSTEM TO THE NEW YORK STATE
 AND LOCAL POLICE AND FIRE RETIREMENT SYSTEM AFTER THE EFFECTIVE DATE  OF
 THIS  SUBDIVISION AND ANY MEMBER PREVIOUSLY IN THE TITLE OF DEPUTY SHER-
 IFF HAVING MADE SUCH TRANSFER SHALL BE ENTITLED TO  A  DETERMINATION  OF
 THE  AMOUNT OF SERVICE CREDIT THAT IS ELIGIBLE ON A TWENTY YEAR OR TWEN-
 TY-FIVE YEAR RETIREMENT PLAN IF, WITHIN ONE YEAR OF THE DATE ON WHICH HE
 OR SHE FIRST BECAME A MEMBER OF THE NEW YORK STATE AND LOCAL POLICE  AND
 FIRE  RETIREMENT SYSTEM OR WITHIN ONE YEAR OF THE EFFECTIVE DATE OF THIS
 SUBDIVISION, SUCH MEMBER ELECTS TO DO SO.  IF  THE  MEMBER  SUBSEQUENTLY
 TRANSFERS  BACK  TO  THE  NEW YORK STATE AND LOCAL EMPLOYEES' RETIREMENT
 SYSTEM, THE FULL AMOUNT OF SERVICE CREDIT EARNED WHILE IN THE  TITLE  OF
 DEPUTY SHERIFF SHALL BE TRANSFERRED BACK TO THE NEW YORK STATE AND LOCAL
 EMPLOYEES' RETIREMENT SYSTEM.
   2.  THE  CALCULATION OF THE AMOUNT OF SUCH SERVICE CREDIT FOR A MEMBER
 WILL BE DETERMINED BY MULTIPLYING THE ELIGIBLE SERVICE CREDITED  IN  THE
 NEW  YORK  STATE AND LOCAL EMPLOYEES' RETIREMENT SYSTEM PLAN BY A SALARY
 MULTIPLIER, REFLECTING THE RATE OF SALARY IN  THE  NEW  YORK  STATE  AND
 LOCAL  EMPLOYEES'  RETIREMENT SYSTEM PLAN RELATIVE TO THE RATE OF SALARY
 IN THE NEW YORK STATE AND LOCAL POLICE AND FIRE RETIREMENT SYSTEM  PLAN,
 AND  A BILLING RATE MULTIPLIER, REFLECTING THE ACTUARIAL LONG-TERM AVER-
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD04164-06-2
 S. 9115                             2

 AGE BILLING RATE IN THE NEW YORK STATE AND LOCAL  EMPLOYEES'  RETIREMENT
 SYSTEM  PLAN RELATIVE TO THE ACTUARIAL LONG-TERM AVERAGE BILLING RATE IN
 THE NEW YORK STATE AND LOCAL POLICE AND FIRE RETIREMENT SYSTEM PLAN. THE
 DETERMINATION  OF THE SALARY MULTIPLIER AND BILLING RATE MULTIPLIER WILL
 BE DETERMINED BY THE ACTUARY OF THE NEW YORK STATE AND LOCAL  EMPLOYEES'
 RETIREMENT  SYSTEM  AND  THE  NEW  YORK  STATE AND LOCAL POLICE AND FIRE
 RETIREMENT SYSTEM. THE AMOUNT OF SUCH SERVICE CREDITED TO THE MEMBER  IN
 THE  NEW  YORK  STATE  AND  LOCAL POLICE AND FIRE RETIREMENT SYSTEM PLAN
 SHALL NOT EXCEED THE AMOUNT OF SERVICE CREDITED TO THE MEMBER IN THE NEW
 YORK STATE AND LOCAL EMPLOYEES' RETIREMENT SYSTEM PLAN.
   § 2. Section 343 of the retirement and social security law is  amended
 by adding a new subdivision i to read as follows:
   I. 1. NOTWITHSTANDING ANY OTHER LAW, RULE OR REGULATION TO THE CONTRA-
 RY,  ANY MEMBER IN THE TITLE OF DEPUTY SHERIFF TRANSFERRING FROM THE NEW
 YORK STATE AND LOCAL EMPLOYEES' RETIREMENT SYSTEM TO THE NEW YORK  STATE
 AND  LOCAL POLICE AND FIRE RETIREMENT SYSTEM AFTER THE EFFECTIVE DATE OF
 THIS SUBDIVISION AND ANY MEMBER PREVIOUSLY IN THE TITLE OF DEPUTY  SHER-
 IFF  HAVING  MADE  SUCH TRANSFER SHALL BE ENTITLED TO A DETERMINATION OF
 THE AMOUNT OF SERVICE CREDIT THAT IS ELIGIBLE ON A TWENTY YEAR OR  TWEN-
 TY-FIVE YEAR RETIREMENT PLAN IF, WITHIN ONE YEAR OF THE DATE ON WHICH HE
 OR  SHE FIRST BECAME A MEMBER OF THE NEW YORK STATE AND LOCAL POLICE AND
 FIRE RETIREMENT SYSTEM OR WITHIN ONE YEAR OF THE EFFECTIVE DATE OF  THIS
 SUBDIVISION,  SUCH  MEMBER  ELECTS  TO DO SO. IF THE MEMBER SUBSEQUENTLY
 TRANSFERS BACK TO THE NEW YORK STATE  AND  LOCAL  EMPLOYEES'  RETIREMENT
 SYSTEM,  THE  FULL AMOUNT OF SERVICE CREDIT EARNED WHILE IN THE TITLE OF
 DEPUTY SHERIFF SHALL BE TRANSFERRED BACK TO NEW  YORK  STATE  AND  LOCAL
 EMPLOYEES' RETIREMENT SYSTEM.
   2.  THE  CALCULATION OF THE AMOUNT OF SUCH SERVICE CREDIT FOR A MEMBER
 WILL BE DETERMINED BY MULTIPLYING THE ELIGIBLE SERVICE CREDITED  IN  THE
 NEW  YORK  STATE AND LOCAL EMPLOYEES' RETIREMENT SYSTEM PLAN BY A SALARY
 MULTIPLIER, REFLECTING THE RATE OF SALARY IN  THE  NEW  YORK  STATE  AND
 LOCAL  EMPLOYEES'  RETIREMENT SYSTEM PLAN RELATIVE TO THE RATE OF SALARY
 IN THE NEW YORK STATE AND LOCAL POLICE AND FIRE RETIREMENT SYSTEM  PLAN,
 AND  A BILLING RATE MULTIPLIER, REFLECTING THE ACTUARIAL LONG-TERM AVER-
 AGE BILLING RATE IN THE NEW YORK STATE AND LOCAL  EMPLOYEES'  RETIREMENT
 SYSTEM  PLAN RELATIVE TO THE ACTUARIAL LONG-TERM AVERAGE BILLING RATE IN
 THE NEW YORK STATE AND LOCAL POLICE AND FIRE RETIREMENT SYSTEM PLAN. THE
 DETERMINATION OF THE SALARY MULTIPLIER AND BILLING RATE MULTIPLIER  WILL
 BE  DETERMINED BY THE ACTUARY OF THE NEW YORK STATE AND LOCAL EMPLOYEES'
 RETIREMENT SYSTEM AND THE NEW YORK  STATE  AND  LOCAL  POLICE  AND  FIRE
 RETIREMENT  SYSTEM. THE AMOUNT OF SUCH SERVICE CREDITED TO THE MEMBER IN
 THE NEW YORK STATE AND LOCAL POLICE  AND  FIRE  RETIREMENT  SYSTEM  PLAN
 SHALL NOT EXCEED THE AMOUNT OF SERVICE CREDITED TO THE MEMBER IN THE NEW
 YORK STATE AND LOCAL EMPLOYEES' RETIREMENT SYSTEM PLAN.
   3.  IF THE MEMBER SUBSEQUENTLY RETIRES ON AN AGE BASED RETIREMENT PLAN
 IN THE NEW YORK STATE  AND  LOCAL  POLICE  AND  FIRE  RETIREMENT  SYSTEM
 INSTEAD  OF  A  TWENTY YEAR OR TWENTY-FIVE YEAR PLAN, THE FULL AMOUNT OF
 SERVICE CREDIT EARNED WHILE IN THE TITLE  OF  DEPUTY  SHERIFF  SHALL  BE
 GRANTED.
   4.  NO MEMBER WHO RECEIVES SERVICE CREDIT PURSUANT TO THIS SUBDIVISION
 SHALL BE ELIGIBLE TO  RECEIVE  ADDITIONAL  SERVICE  CREDIT  PURSUANT  TO
 SUBDIVISION  B OF SECTION THREE HUNDRED EIGHTY FOUR-E OF THIS ARTICLE IF
 HIS OR HER EMPLOYER HAS ELECTED TO PROVIDE SUCH SERVICE CREDIT.
   § 3. This act shall take effect on the sixtieth day after an  internal
 revenue service ruling stating that the transfer and crediting of deputy
 sheriff  service  credit  from  the  New York state and local employees'
 S. 9115                             3
 
 retirement system into the New York state  and  local  police  and  fire
 retirement  system  special retirement plan by this act is allowable and
 does not jeopardize such retirement system's tax-qualified  status,  and
 shall  remain  in full force and effect only as long as such transfer is
 authorized pursuant to the provisions  of  the  internal  revenue  code;
 provided,  that  the state comptroller shall notify the legislative bill
 drafting commission upon the occurrence of  such  ruling  and  upon  any
 change  in  the  provisions  of  the internal revenue code affecting the
 provisions of this act in order that  the  commission  may  maintain  an
 accurate and timely effective data base of the official text of the laws
 of  the  state of New York in furtherance of effecting the provisions of
 section 44 of the legislative law and section 70-b of the  public  offi-
 cers law.
   FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
   This  bill  would  expand  the  definition of creditable service under
 20-year and 25-year plans (special plans) in  the  New  York  State  and
 Local Police and Fire Retirement System (PFRS) to include service credit
 earned  in  the  New  York  State and Local Employees' Retirement System
 (ERS) for those individuals previously employed in the title  of  Deputy
 Sheriff.  To be eligible for the service credit, an individual must be a
 member of PFRS and elect to transfer the ERS service credit to the  PFRS
 plan  within 12 months of first joining PFRS, or within 12 months of the
 effective date of the bill, whichever is later. The  amount  of  service
 credit  granted in the PFRS special plan will be calculated by the Actu-
 ary of the New York State and Local Retirement System (NYLSRS),  not  to
 exceed the service credited under the ERS plan.
   Internal  Revenue  Service  (IRS)  plan qualification issues: granting
 service credit towards retirement in a 20-year  plan  in  the  PFRS  for
 employment  that  was  not  rendered  in  the  PFRS could jeopardize the
 Retirement System's governmental plan  status  and  its  exemption  from
 Employees Retirement Income Security Act (ERISA). This development could
 result in the loss of qualified status, which would mean the loss of tax
 benefits.  This  result would substantially impair the System's value to
 our more than one million participants.
   This legislation will not become  effective  until  NYLSRS  obtains  a
 favorable  ruling  from  the IRS stating that these provisions would not
 harm the qualification status of the System. Further, the provisions  of
 this  legislation  will  only continue in full force and effect while so
 authorized by the IRS. It is estimated  that  the  costs  to  obtain  an
 initial  ruling  would  be $28,000 for the services of the IRS, and $800
 per hour for legal consultants.
   In addition to the costs to obtain a ruling from the IRS stated above,
 if this bill is enacted, there will be an administrative cost to  imple-
 ment the provisions of this legislation.
   All  costs  will  be  shared  by  the State of New York and all of the
 participating employers in the PFRS.
   Summary of relevant resources:
   Membership data as of March 31, 2021 was used in measuring the  impact
 of the proposed change, the same data used in the April 1, 2021 actuari-
 al  valuation.  Distributions  and  other statistics can be found in the
 2021 Report of the Actuary and the 2021 Comprehensive  Annual  Financial
 Report.
   The  actuarial  assumptions and methods used are described in the 2020
 and 2021 Annual Report to the Comptroller on Actuarial Assumptions,  and
 the  Codes,  Rules  and  Regulations of the State of New York: Audit and
 Control.
 S. 9115                             4
 
   The Market Assets and GASB Disclosures are found in the March 31, 2021
 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  February  18,  2022, and intended for use only
 during the  2022  Legislative  Session,  is  Fiscal  Note  No.  2022-60,
 prepared  by  the  Actuary  for  the New York State and Local Retirement
 System.