S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   6651
 
                        2023-2024 Regular Sessions
 
                           I N  A S S E M B L Y
 
                              April 25, 2023
                                ___________
 
 Introduced  by  M.  of A. PHEFFER AMATO -- read once and referred to the
   Committee on Governmental Employees
 
 AN ACT to amend the retirement and social security law, in  relation  to
   additional  member  contributions  for  certain  members under the age
   fifty-seven retirement program

   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  Paragraph  1  of  subdivision  f  of section 604-d of the
 retirement and social security law is amended by adding a  new  subpara-
 graph (iv) to read as follows:
   (IV) NOTWITHSTANDING THE PROVISIONS OF SUBPARAGRAPH (II) OF THIS PARA-
 GRAPH,  A PARTICIPANT HOLDING THE TITLE OF CARPENTER, SUPERVISOR CARPEN-
 TER, SHIP CARPENTER, SUPERVISOR  SHIP  CARPENTER,  RIGGER,  DOCKBUILDER,
 SUPERVISOR  DOCKBUILDER  AND  GENERAL  SUPERVISOR  DOCKBUILDER  WHO IS A
 PARTICIPANT IN THE AGE FIFTY-SEVEN RETIREMENT PROGRAM AND WHOSE AGE  AND
 ALLOWABLE  SERVICE ARE SUCH THAT HE OR SHE COULD NOT POSSIBLY BE ABLE TO
 ACCUMULATE AT LEAST TWENTY-FIVE YEARS OF SERVICE BY THE TIME HE  OR  SHE
 REACHES  AGE  FIFTY-SEVEN,  SHALL NOT BE REQUIRED TO MAKE THE ADDITIONAL
 MEMBER CONTRIBUTION PURSUANT TO SUBPARAGRAPH  (II)  OF  THIS  PARAGRAPH.
 ANY  PARTICIPANT  IN THE TITLES LISTED IN THIS SUBPARAGRAPH WHO HAS MADE
 ADDITIONAL MEMBER CONTRIBUTIONS PURSUANT TO SUBPARAGRAPH  (II)  OF  THIS
 PARAGRAPH  PRIOR TO THE EFFECTIVE DATE OF THE CHAPTER OF THE LAWS OF TWO
 THOUSAND TWENTY-THREE THAT  ADDED  THIS  SUBPARAGRAPH  SHALL  RECEIVE  A
 REFUND  OF  THE  EMPLOYEE  PORTION  OF  SUCH CONTRIBUTIONS PLUS INTEREST
 PROVIDED THAT THEIR AGE AND ALLOWABLE SERVICE ARE SUCH THAT  HE  OR  SHE
 COULD  NOT  POSSIBLY BE ABLE TO ACCUMULATE AT LEAST TWENTY-FIVE YEARS OF
 SERVICE BY THE TIME HE OR SHE REACHES AGE FIFTY-SEVEN.
   § 2. This act shall take effect immediately.
   FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
   SUMMARY OF BILL:  This  proposed  legislation  would  amend  New  York
 Retirement  and  Social  Security  Law  (RSSL)  Section  604-d to exempt
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD08433-02-3
              

 A. 6651                             2
 
 certain Tier 4 carpenter titles from the physically  taxing  provisions,
 which permit retirement at age 50 (with 25 years of credited service).
   Participants  in  Eligible  Carpenter Titles who started in the Age 57
 Retirement Program (57/5 Plan), but will not reach 25 years of  credited
 service  in  a physically taxing title by age 57, would be ineligible to
 take advantage of the early  retirement  provisions  of  the  physically
 taxing title.
   Under  the  proposed  legislation,  these  members would no longer pay
 physically taxing  Additional  Member  Contributions  (AMCs)  and  would
 receive an immediate refund of the employee portion (i.e., 50%) of their
 physically taxing AMCs plus interest.
   Eligible  Carpenter  Titles  are  participants  in  the  New York City
 Employees' Retirement System (NYCERS) or the Board of Education  Retire-
 ment  System  of  the  City  of New York (BERS) in the physically taxing
 titles of carpenter, supervisor carpenter,  ship  carpenter,  supervisor
 ship carpenter, rigger, dockbuilder, supervisor dockbuilder, and general
 supervisor dockbuilder.
   Participants  would  remain  responsible  for  applicable basic member
 contributions and applicable non-physically taxing  AMCs  for  continued
 57/5 Plan participation.
   Effective Date: Upon enactment.
   FINANCIAL  IMPACT - PRESENT VALUES: Based on census data and the actu-
 arial assumptions and methods described herein, the  enactment  of  this
 proposed legislation would result in an increase in the present value of
 future  employer contributions for NYCERS and BERS of approximately $4.8
 million.
   Under the Entry Age Normal cost method used to determine the  employer
 contributions  to  NYCERS  and  BERS,  there would be an increase in the
 Unfunded Accrued Liability (UAL) of approximately $2.2  million  and  an
 increase in the Present Value of Future Employer Normal Cost of approxi-
 mately $2.6 million. These results are summarized in the table below:

   Change in ($ Thousands):                NYCERS     BERS     Total
   Actuarial Value of Assets (AVA)         $(5,234)  $ (89)    $(5,323)
   Accrued Liability (AL)                  $(3,093)  $ (44)    $(3,137)
   Unfunded Accrued Liability (AL - AVA)   $ 2,141   $  45     $ 2,186
   Present Value of Future
   Employer Normal Cost                    $ 2,535   $  61     $ 2,596
 
   FINANCIAL  IMPACT  -  ANNUAL  EMPLOYER CONTRIBUTIONS: The enactment of
 this proposed legislation would result in an initial increase in  annual
 employer  contributions of approximately $860,000 for NYCERS and $17,000
 for BERS which is the result of an increase in the Normal Cost in  addi-
 tion  to  the UAL payment. The initial increase in the employer contrib-
 utions is estimated to be $378,000 for New York City  and  $499,000  for
 the non-New York City obligors.
   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 this  group  is  approximately  seven
 years  for  NYCERS  and eight years for BERS and the increase in UAL was
 therefore amortized over a seven-year period (six payments)  for  NYCERS
 and  over  an eight-year period (seven payments) for BERS under the One-
 Year Lag Methodology using level dollar payments.
   CENSUS DATA: The estimates presented herein are based  on  the  census
 data used in the June 30, 2022 actuarial valuation of NYCERS and BERS to
 determine the Preliminary Fiscal Year 2024 employer contributions.
 A. 6651                             3
 
                            NYCERS           BERS        NYCERS & BERS
   Count                      205              5              210
   Average Age            57.7 years      58.4 years      57.7 years
   Average Service        15.8 years      16.6 years      15.8 years
   Average Salary          $109,100        $105,200        $109,000
 
   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  and
 BERS.
   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  and BERS 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.
   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 to estimate the costs here-
 in,  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 2023-14 dated  March  27,
 2023  was prepared by the Chief Actuary for the New York City Employees'
 Retirement System and the Board of Education Retirement  System  of  the
 City of New York. This estimate is intended for use only during the 2023
 Legislative Session.