The New York State Senate

 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  4233--A
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                             February 3, 2021
                                ___________
 
 Introduced  by  Sens.  GOUNARDES,  GAUGHRAN,  KENNEDY  -- 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 and  the  general
   municipal  law,  in relation to disability retirement benefits for the
   presumption of Parkinson's Disease for paid firefighters
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. The retirement and social security law is amended by adding
 a new section 363-ff to read as follows:
   §  363-FF.  FIREFIGHTER  CERTAIN  IMPAIRMENTS  OF HEALTH; PRESUMPTION.
 NOTWITHSTANDING ANY OTHER PROVISIONS OF THIS CHAPTER  TO  THE  CONTRARY,
 ANY  CONDITION  OF  IMPAIRMENT  OF HEALTH CAUSED BY PARKINSON'S DISEASE,
 RESULTING IN TOTAL OR PARTIAL DISABILITY OR DEATH TO A PAID FIREFIGHTER,
 WHO SUCCESSFULLY PASSED A PHYSICAL EXAMINATION ON ENTRY INTO FIREFIGHTER
 SERVICE, WHICH EXAMINATION FAILED TO REVEAL ANY EVIDENCE OF SUCH  CONDI-
 TION,  SHALL BE PRESUMPTIVE EVIDENCE THAT, UNLESS THE CONTRARY BE PROVEN
 BY COMPETENT EVIDENCE, SUCH DISABILITY OR DEATH (A) WAS  CAUSED  BY  THE
 NATURAL  AND  PROXIMATE  RESULT OF AN ACCIDENT, NOT CAUSED BY SUCH FIRE-
 FIGHTER'S OWN WILLFUL NEGLIGENCE, AND (B) WAS SUSTAINED IN THE  PERFORM-
 ANCE AND DISCHARGE OF DUTY.
   §  2.  The  general  municipal  law is amended by adding a new section
 207-kkk to read as follows:
   § 207-KKK. DISABILITIES OF FIREFIGHTERS IN CERTAIN  CITIES  CAUSED  BY
 PARKINSON'S DISEASE.  NOTWITHSTANDING ANY OTHER PROVISIONS OF THIS CHAP-
 TER  TO  THE  CONTRARY,  ANY CONDITION OF IMPAIRMENT OF HEALTH CAUSED BY
 PARKINSON'S DISEASE RESULTING IN TOTAL OR PARTIAL DISABILITY OR DEATH TO
 A PAID MEMBER OF A FIRE DEPARTMENT IN A CITY WITH A  POPULATION  OF  ONE
 MILLION  OR  MORE, OR ANY RETIRED MEMBER OF SUCH DEPARTMENT WHO HAS BEEN
 RETIRED FOR TWO OR LESS YEARS, WHO SUCCESSFULLY PASSED A PHYSICAL  EXAM-
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.

                                                            LBD06247-03-1

 S. 4233--A                          2
 
 INATION  ON ENTRY INTO THE SERVICE OF SUCH DEPARTMENT, WHICH EXAMINATION
 FAILED TO REVEAL ANY EVIDENCE OF SUCH CONDITION,  SHALL  BE  PRESUMPTIVE
 EVIDENCE  THAT  IT WAS INCURRED IN THE PERFORMANCE AND DISCHARGE OF DUTY
 UNLESS THE CONTRARY BE PROVED BY COMPETENT EVIDENCE.
   §  3.  The  board  of  trustees  of  the New York city fire department
 pension fund shall take appropriate administrative action  to  implement
 the intent of section two of this act.
   § 4. This act shall take effect immediately.
   FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
   This  bill  would amend both the General Municipal Law and the Retire-
 ment and Social Security Law to provide firefighters with a  presumption
 that  any  disability  or  death  resulting  from  impairments of health
 related to Parkinson's Disease are the result of an  accident  sustained
 in  the performance of duty, unless the contrary can be proven by compe-
 tent evidence.
   Insofar as it will affect the New York State and Local Police and Fire
 Retirement System (PFRS), if this bill is enacted it would lead to  more
 disabilities  and  deaths  being classified as "accidental". The cost of
 the revised benefit will depend upon the applicant's age, service, sala-
 ry, plan and benefit type otherwise payable.
 
 Benefit without   None     Ordinary      POD        Service   Death
 enactment:                Disability   Disability
 Cost for revised  9 times   5 times    2.5 times    2 times   11 times
 benefit:          salary    salary     salary       salary    salary
 
   However, we  anticipate  that  few  additional  accidental  disability
 retirements  and death benefits will be granted, and thus, the resulting
 costs are expected to be negligible. All costs will  be  shared  by  the
 State of New York and the participating employers in the PFRS.
   Summary of relevant resources:
   Membership  data as of March 31, 2020 was used in measuring the impact
 of the proposed change, the same data used in the April 1, 2020 actuari-
 al valuation. Distributions and other statistics can  be  found  in  the
 2020  Report  of the Actuary and the 2020 Comprehensive Annual Financial
 Report.
   The actuarial assumptions and methods used are described in  the  2020
 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, 2020
 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 January 14,  2021,  and  intended  for  use  only
 during  the  2021  Legislative  Session,  is  Fiscal  Note  No. 2021-22,
 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 Fire Pension Fund (FIRE) would amend the General Municipal Law
 (GML) to add a new Section 207-kkk to provide a statutory presumption to

 S. 4233--A                          3
 
 certain FIRE members and retirees who  become  physically  incapacitated
 for performance of duty, or die, while so employed, or within 2 years of
 their respective date of retirement, due to Parkinson's Disease.
   A  qualifying  FIRE member or retiree who dies or suffers from a disa-
 bility due to Parkinson's Disease, absent  evidence  of  such  condition
 upon  physical  examination at hire, would be provided with a rebuttable
 presumption that such disability was incurred  in  the  performance  and
 discharge  of  duty.  The  presumption of causation could be rebutted by
 competent evidence to the contrary.
   Effective Date: Upon enactment.
   FINANCIAL IMPACT - OVERVIEW: There is no data  available  to  estimate
 the  number of members or eligible retirees who might develop and become
 disabled or die due to Parkinson's Disease, and potentially benefit from
 this proposed legislation.   Therefore, the estimated  financial  impact
 has  been  calculated  on a per event basis equal to the increase in the
 Present Value of Future Benefits (PVFB) for an average  affected  member
 who is diagnosed with Parkinson's Disease as the result of the enactment
 of  the  proposed  legislation  and  who would benefit from the proposed
 legislation.
   In determining the increase in the PVFB, it has been assumed that 100%
 of the members who would retire with Parkinson's  Disease  would  retire
 under  ordinary  disability if the proposed legislation were not passed.
 Due to the progressive nature of Parkinson's Disease,  the  increase  in
 PVFB does not include any cost for additional death benefits.
   With  respect  to  an individual member or eligible retiree, the addi-
 tional cost of this proposed legislation varies greatly.
   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 PVFB by an  amount  ranging
 from $189,600 to $1,391,200 if an eligible firefighter who could benefit
 from  the proposed legislation develops Parkinson's Disease. The average
 increase in PVFB for a single eligible member who could benefit from the
 proposed legislation is approximately $613,900.
   FINANCIAL IMPACT - ANNUAL EMPLOYER CONTRIBUTIONS:  Enactment  of  this
 proposed  legislation  would increase employer contributions, where such
 amount would depend on the number of members affected as well  as  other
 characteristics  including the age, years of service, and salary of each
 member.
   As there is no data currently available  to  estimate  the  number  of
 members  who  might be diagnosed with Parkinson's Disease, the financial
 impact would be recognized at the time of event.  Consequently,  changes
 in employer contributions have been estimated assuming that the increase
 in the PVFB will be financed over a time period used for actuarial loss-
 es  in  accordance  with  Section 13-638.2(k-2) of the ACCNY. Using this
 approach, the additional PVFB would be amortized over a  closed  15-year
 period  (14  payments  under  the  One-Year Lag Methodology) using level
 dollar payments.
   Based on the Actuary's actuarial assumptions and methods in effect for
 the June 30, 2019 (Lag)  actuarial  valuations  used  to  determine  the
 Preliminary  Fiscal  Year 2021 employer contribution of FIRE, the enact-
 ment of this  proposed  legislation  is  estimated  to  increase  annual
 employer  contributions by an amount ranging from $22,400 to $164,600 if
 a qualifying member develops Parkinson's Disease. The  average  increase
 in  annual  employer contributions for a single member who could benefit
 from the proposed legislation is approximately $72,600.  With respect to
 the timing, increases in employer contributions would depend  upon  when

 S. 4233--A                          4
 
 members  begin  to  receive  an  accidental  benefit  due to Parkinson's
 Disease but, generally,  increased  employer  contributions  will  first
 occur the second fiscal year following approval of the accident disabil-
 ity retirement.
   CENSUS DATA: For purposes of this Fiscal Note, it was assumed that the
 census data had the same age, gender, and service characteristics as the
 census  data used in the Preliminary June 30, 2019 (Lag) actuarial valu-
 ation of FIRE to determine the Preliminary  Fiscal  Year  2021  employer
 contribution.  Active  members' salaries and balances have been adjusted
 to reflect estimated salary increases from June 30,  2019  to  June  30,
 2020.
   There  are  11,244  active  FIRE members as of June 30, 2019 who could
 potentially benefit from the proposed legislation. These active  members
 had  an  average  age  of  approximately  40.5 years, average service of
 approximately  13.8  years,  and  an  average  salary  of  approximately
 $118,900.
   There  are  245  retired FIRE members who retired between July 1, 2017
 and June 30, 2019 who were receiving a pension benefit, other than Acci-
 dental Disability or Accidental Death, as of June  30,  2019  and  could
 potentially benefit from the proposed legislation. These retired members
 had  an  average  age of approximately 56.5 years and an average pension
 benefit of approximately $108,400.
   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 contribution
 of FIRE.
   The Actuary is proposing a set of changes for use in the June 30, 2019
 (Lag) actuarial valuations of NYCRS 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  increases  in  the Present Value of
 Employer  Contributions  and  annual  employer  contributions  that  are
 approximately 2% larger than 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  initial,  additional  administrative  costs  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
 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

 S. 4233--A                          5
 
 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 2021-12 dated March 25,
 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.