A. 6156 2
A NEW YORK CITY ELIGIBLE MEMBER IN ACTIVE SERVICE ON THE ENACTMENT DATE
OF THE AGE FIFTY-FIVE IMPROVED BENEFIT RETIREMENT PROGRAM WHO IS AN
ACTIVE OR RETIRED EMPLOYEE OF THE COUNCIL OF THE CITY OF NEW YORK MAY
ELECT TO PARTICIPATE IN THE AGE FIFTY-FIVE IMPROVED BENEFIT RETIREMENT
PROGRAM AT ANY TIME SUBSEQUENT TO THE ENACTMENT DATE OF SUCH PROGRAM.
6. Notwithstanding any other provision of law to the contrary, any
person who is eligible to elect to become a participant in the age
fifty-five improved benefit retirement program pursuant to paragraph one
or two of this subdivision for the full ninety-day period provided for
in such applicable paragraph, and who fails to timely file a duly
executed application for such participation with the appropriate retire-
ment system, shall not thereafter be eligible to become a participant in
such program. THE PROVISIONS OF THIS PARAGRAPH SHALL NOT BAR PARTIC-
IPATION IN SUCH PROGRAM, HOWEVER, BY A NEW YORK CITY ELIGIBLE MEMBER IN
ACTIVE SERVICE ON THE ENACTMENT DATE OF THE AGE FIFTY-FIVE IMPROVED
BENEFIT RETIREMENT PROGRAM WHO IS AN ACTIVE OR RETIRED EMPLOYEE OF THE
COUNCIL OF THE CITY OF NEW YORK.
§ 3. Paragraph 1 of subdivision c of section 445-d of the retirement
and social security law, as added by chapter 96 of the laws of 1995, is
amended to read as follows:
1. Non-physically taxing service retirement. Notwithstanding any other
provision of law to the contrary, a participant in the age fifty-five
improved benefit retirement program:
(i) who is otherwise eligible to retire for service with immediate
payability of a retirement allowance pursuant to section 13-162 of the
administrative code or section thirty of the BERS rules and regulations;
and
(ii) who has completed twenty-five or more years of credited CPP qual-
ifying service; and
(iii) who has attained age fifty-five; and
(iv) who, subject to the provisions of paragraph ten of subdivision d
of this section, has paid, before the effective date of retirement, all
additional member contributions and interest (if any) required by para-
graphs one, four, five and six of subdivision d of this section, OR, FOR
A NEW YORK CITY ELIGIBLE MEMBER IN ACTIVE SERVICE ON THE ENACTMENT DATE
OF THE AGE FIFTY-FIVE IMPROVED BENEFIT RETIREMENT PROGRAM WHO IS AN
ACTIVE OR RETIRED EMPLOYEE OF THE COUNCIL OF THE CITY OF NEW YORK, WHO
HAS PAID ALL ADDITIONAL MEMBER CONTRIBUTIONS PURSUANT TO PARAGRAPH FIVE
OF SUBDIVISION D OF THIS SECTION; and
(v) who shall be a participant in the age fifty-five improved benefit
retirement program in active service at the time so specified for his or
her retirement; shall, subject to the provisions of paragraph ten of
subdivision d of this section, be permitted to retire with a minimum
retirement age of fifty-five, and the benefit reduction provisions set
forth in subdivision a of section four hundred forty-two of this article
shall not be applied to the calculation of such participant's retirement
benefit.
FOR A NEW YORK CITY ELIGIBLE MEMBER IN ACTIVE SERVICE ON THE ENACTMENT
DATE OF THE AGE FIFTY-FIVE IMPROVED BENEFIT RETIREMENT PROGRAM WHO IS A
RETIRED EMPLOYEE OF THE COUNCIL OF THE CITY OF NEW YORK, HOWEVER, THERE
SHALL BE NO REQUIREMENT OF ACTIVE SERVICE AT THE TIME OF FILING FOR
RETIREMENT PROVIDED THAT SUCH EMPLOYEE HAS MET THE OTHER REQUIREMENTS OF
THIS PARAGRAPH.
§ 4. Subdivision a of section 604-c of the retirement and social secu-
rity law, as added by chapter 96 of the laws of 1995, is amended by
adding two new paragraphs 14 and 15 to read as follows:
A. 6156 3
14. "ACTIVE OR RETIRED EMPLOYEE OF THE COUNCIL OF THE CITY OF NEW
YORK" SHALL MEAN ALL DULY SWORN MEMBERS OF THE NEW YORK CITY COUNCIL AS
WELL AS ALL SALARIED EMPLOYEES WHO COMPRISE THE STAFF OF THE CITY COUN-
CIL ON A FULL-TIME OR PART-TIME BASIS WHO ARE EITHER IN ACTIVE SERVICE
ON THE EFFECTIVE DATE OF THIS PARAGRAPH OR WHO RETIRED FROM SUCH
SERVICE.
15. "RETIRED EMPLOYEE OF THE COUNCIL OF THE CITY OF NEW YORK" SHALL
MEAN ALL DULY SWORN MEMBERS OF THE NEW YORK CITY COUNCIL AS WELL AS ALL
SALARIED EMPLOYEES WHO COMPRISE THE STAFF OF THE CITY COUNCIL ON A FULL-
TIME OR PART-TIME BASIS WHO ARE RETIRED FROM ACTIVE SERVICE.
§ 5. Paragraphs 1 and 7 of subdivision b of section 604-c of the
retirement and social security law, as added by chapter 96 of the laws
of 1995, are amended to read as follows:
1. Subject to the provisions of paragraphs five, six and seven of this
subdivision, any person who is employed in a New York city eligible
position on the enactment date of the twenty-five-year early retirement
program, and who is a New York city eligible member in active service on
such enactment date, may elect to become a participant in the twenty-
five-year early retirement program by filing, within ninety days after
the enactment date of the twenty-five-year early retirement program, a
duly executed application for such participation with the retirement
system of which such person is a member, provided he or she is a New
York city eligible member in active service on the date such application
is filed. NOTWITHSTANDING THIS PROVISION, A NEW YORK CITY ELIGIBLE
MEMBER IN ACTIVE SERVICE ON THE ENACTMENT DATE OF THE TWENTY-FIVE-YEAR
EARLY RETIREMENT PROGRAM WHO IS AN ACTIVE OR RETIRED EMPLOYEE OF THE
COUNCIL OF THE CITY OF NEW YORK MAY ELECT TO PARTICIPATE IN THE TWENTY-
FIVE-YEAR EARLY RETIREMENT PROGRAM AT ANY TIME SUBSEQUENT TO THE ENACT-
MENT DATE OF SUCH PROGRAM.
7. Notwithstanding any other provision of law to the contrary, any
person who is eligible to elect to become a participant in the twenty-
five-year early retirement program pursuant to paragraph one or two of
this subdivision for the full ninety-day period provided for in such
applicable subparagraph, and who fails to timely file a duly executed
application for such participation with the appropriate retirement
system, shall not thereafter be eligible to become a participant in such
program. THE PROVISIONS OF THIS PARAGRAPH SHALL NOT BAR PARTICIPATION IN
SUCH PROGRAM, HOWEVER, BY A NEW YORK CITY ELIGIBLE MEMBER IN ACTIVE
SERVICE ON THE ENACTMENT DATE OF THE TWENTY-FIVE-YEAR EARLY RETIREMENT
PROGRAM WHO IS AN ACTIVE OR RETIRED EMPLOYEE OF THE COUNCIL OF THE CITY
OF NEW YORK.
§ 6. Paragraph 1 of subdivision c of section 604-c of the retirement
and social security law, as added by chapter 96 of the laws of 1995,
is amended to read as follows:
1. Non-physically taxing service retirement. A participant in the
twenty-five year early retirement program:
(i) who has completed twenty-five or more years of credited service;
and
(ii) who has attained age fifty-five; and
(iii) who, subject to the provisions of paragraph ten of subdivision d
of this section, has paid, before the effective date of retirement, all
additional member contributions and interest (if any) required by para-
graphs one, four, five and six of subdivision d of this section, OR, FOR
A NEW YORK CITY ELIGIBLE MEMBER IN ACTIVE SERVICE ON THE ENACTMENT DATE
OF THE TWENTY-FIVE-YEAR EARLY RETIREMENT PROGRAM WHO IS AN ACTIVE OR
RETIRED EMPLOYEE OF THE COUNCIL OF THE CITY OF NEW YORK, WHO HAS PAID
A. 6156 4
ALL ADDITIONAL MEMBER CONTRIBUTIONS PURSUANT TO PARAGRAPH FIVE OF SUBDI-
VISION D OF THIS SECTION; and
(iv) who files with the retirement system of which he or she is a
member an application for service retirement setting forth at what time
he or she desires to be retired, OR, FOR A NEW YORK CITY ELIGIBLE MEMBER
IN ACTIVE SERVICE ON THE ENACTMENT DATE OF THE TWENTY-FIVE-YEAR EARLY
RETIREMENT PROGRAM WHO IS A RETIRED EMPLOYEE OF THE COUNCIL OF THE CITY
OF NEW YORK, WHO FILES AN APPLICATION FOR PARTICIPATION IN THE RETIRE-
MENT PLAN DESCRIBED BY THIS SECTION; and
(v) who shall be a participant in the twenty-five-year early retire-
ment program in active service at the time so specified for his or her
retirement; shall be retired pursuant to the provisions of this para-
graph affording early service retirement.
FOR A NEW YORK CITY ELIGIBLE MEMBER IN ACTIVE SERVICE ON THE ENACTMENT
DATE OF THE TWENTY-FIVE-YEAR EARLY RETIREMENT PROGRAM WHO IS A RETIRED
EMPLOYEE OF THE COUNCIL OF THE CITY OF NEW YORK, HOWEVER, THERE SHALL BE
NO REQUIREMENT OF ACTIVE SERVICE AT THE TIME OF FILING FOR RETIREMENT
PROVIDED THAT SUCH EMPLOYEE HAS MET THE OTHER REQUIREMENTS OF THIS PARA-
GRAPH.
§ 7. Notwithstanding any other provision of law to the contrary, none
of the provisions of this act shall be subject to the appropriation
requirement of section 25 of the retirement and social security law.
§ 8. This act shall take effect on the ninetieth day after it shall
have become a law. The board of trustees of the New York city employees'
retirement system shall prescribe rules or regulations before the effec-
tive date of this act to provide that any New York city eligible member
in active service on the enactment date of the age fifty-five improved
benefit retirement program or the twenty-five-year early retirement
program who is an active or retired employee of the council of the city
of New York, as defined in sections 445-d and 604-c of the retirement
and social security law, shall be given an application to join the age
fifty-five improved benefit retirement program or the twenty-five-year
early retirement program, as applicable and as established by such
sections, if such member is made newly eligible by this act.
FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
SUMMARY OF BILL: This proposed legislation would amend provisions of
the Retirement and Social Security Law (RSSL) to reopen the 55/25 Plans
for active or retired Tier 2 and Tier 4 City Council employees who were
New York City Employees' Retirement System (NYCERS) members and employed
in such position as of June 28, 1995.
Effective Date: The 90th day after enactment.
BACKGROUND: Tier 2 or Tier 4 members who were employed in an Eligible
Position on June 28, 1995 had an option, pursuant to Chapter 96 of the
Laws of 1995, to join the 55/25 Plans by filing an election form with
NYCERS within 90 days. Eligible Members who failed to elect the 55/25
Plans, or other plans enacted by Chapter 96, generally participate in a
Basic 62/5 Plan.
Under the proposed legislation, active and retired members who were
City Council employees on June 28, 1995 would be allowed to join the
55/25 Plans at any time after the Effective Date of the proposed legis-
lation. Such members would be required to pay any additional member
contributions required by the 55/25 Plans.
IMPACT ON PAYABILITY: Currently, members in a Basic 62/5 Plan can
begin collecting an unreduced pension at age 62 with at least five years
of service, or as early as age 55 with benefit reductions depending on
their age of retirement. Electing the 55/25 Plans would allow such
A. 6156 5
members to begin collecting an unreduced pension, assuming at least 25
years of service, at age 55.
Members who have already retired with at least 25 years of service at
retirement but whose benefit was reduced due to their age at retirement,
would be able to elect to join the 55/25 Plans and have their benefits
recalculated. They would also receive a retroactive payment equal to the
difference between their current benefit and revised benefit as of their
retirement date.
MEMBER CONTRIBUTIONS: Members of the 55/25 Plans are required to make,
in addition to the Basic Member Contributions (BMCs) of 3%, Additional
Member Contributions (AMCs) ranging from 1.85% to 4.35% (depending on
the dates of service rendered) until the attainment of 25 or 30 years of
credited service, depending on Tier. Active and retired members who
join the Plans through this legislation will be required to contribute
any AMCs, with interest, they would have had to make had they joined the
plans in 1995. It has been assumed that interest on such AMCs would
cease accruing on the earlier of the date of payment or retirement date.
FINANCIAL IMPACT - PRESENT VALUES: Based on the anticipated group of
members electing to join the 55/25 Plans and the actuarial assumptions
and methods described herein, the enactment of this proposed legislation
would result in an increase in the present value of future employer
contributions of approximately $536,000.
This net increase is a result of an increase in the Present Value of
Future Benefits (PVFB) of approximately $1.6 million and an increase in
the present value of member contributions of approximately $1.1 million
which includes the required retroactive AMCs.
Under the Entry Age Normal cost method used to determine the employer
contributions to NYCERS, there would be an increase in the Unfunded
Accrued Liability (UAL) of approximately $884,000 offset by a decrease
in the present value of future employer Normal Cost of approximately
$348,000.
FINANCIAL IMPACT - ANNUAL EMPLOYER CONTRIBUTIONS: The enactment of
this proposed legislation would result in an increase in annual employer
contributions over the next five years of approximately $359,000 in the
first year and $167,000 in years two through five.
New UAL attributable to benefit changes are generally amortized over
the remaining working lifetime of those impacted by the benefit changes.
The remaining working lifetime for active members of this group is
approximately six years and the increase in UAL for actives was there-
fore amortized over a six-year period (five payments under the One-Year
Lag Methodology) using level dollar payments.
For members who would benefit that are retired, and therefore have no
remaining working lifetime, the entire increase in UAL would be recog-
nized immediately.
CENSUS DATA: The estimates presented herein are based on the census
data used in the June 30, 2022 actuarial valuation of NYCERS to deter-
mine the Preliminary Fiscal Year 2024 employer contributions.
The 16 NYCERS City Council members assumed to elect the 55/25 Plans as
of June 30, 2022 include 13 active members and three retirees. The
active members had an average age of approximately 53.9 years, average
service of approximately 30.6 years, and an average salary of approxi-
mately $109,200. The three retired members had an average age of approx-
imately 65.7 years, and an average annual benefit of approximately
$43,400.
A. 6156 6
ACTUARIAL ASSUMPTIONS AND METHODS: The estimates presented herein have
been calculated based on the actuarial assumptions and methods used for
the Preliminary Fiscal Year 2024 employer contributions of NYCERS.
To determine the impact of the elective nature of the proposed legis-
lation, a subgroup of NYCERS City Council members was developed based on
who is assumed to benefit actuarially by comparing the net present value
of future employer costs of each member's benefit under their current
plan and under the 55/25 Plan.
For the purposes of this Fiscal Note, it is assumed that the changes
would be reflected for the first time in the June 30, 2022 actuarial
valuation of NYCERS used to determine employer contributions for Fiscal
Year 2024.
RISK AND UNCERTAINTY: The costs presented in this Fiscal Note depend
highly on the realization of the actuarial assumptions used, demograph-
ics of the impacted population and other factors such as investment,
contribution, and other risks. If actual experience deviates from actu-
arial assumptions, the actual costs could differ from those presented
herein.
Costs are also dependent on the actuarial methods 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 costs.
STATEMENT OF ACTUARIAL OPINION: I, Marek Tyszkiewicz, am the Chief
Actuary for, and independent of, the New York City Retirement Systems
and Pension Funds. I am an Associate of the Society of Actuaries and a
Member of the American Academy of Actuaries. I am a member of NYCERS but
do not believe it impairs my objectivity and 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 2023-10 dated March 14,
2023 was prepared by the Chief Actuary for the New York City Employees'
Retirement System. This estimate is intended for use only during the
2023 Legislative Session.