S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   7714
 
                        2023-2024 Regular Sessions
 
                           I N  A S S E M B L Y
 
                               June 6, 2023
                                ___________
 
 Introduced  by  M.  of A. PHEFFER AMATO -- read once and referred to the
   Committee on Governmental Employees
 
 AN ACT to amend the administrative code of the  city  of  New  York,  in
   relation to promotions of detectives
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:

   Section 1. Section 14-114 of the administrative code of  the  city  of
 New York is amended by adding a new subdivision d to read as follows:
   D.  (1)  WHEN  A DETECTIVE OF THE THIRD GRADE SHALL HAVE SERVED IN THE
 RANK OF DETECTIVE OF THE THIRD GRADE FOR A PERIOD OF FIFTEEN  YEARS,  HE
 OR  SHE SHALL HAVE THE SAME RIGHTS IN RESPECT TO THE POLICE PENSION FUND
 AS A DETECTIVE OF THE THIRD GRADE DETAILED TO ACT AS  DETECTIVE  OF  THE
 SECOND GRADE.
   (2) WHEN A DETECTIVE OF THE SECOND GRADE SHALL HAVE SERVED IN THE RANK
 OF  DETECTIVE  OF  THE SECOND GRADE FOR A PERIOD OF TEN YEARS, HE OR SHE
 SHALL HAVE THE SAME RIGHTS IN RESPECT TO THE POLICE PENSION  FUND  AS  A
 DETECTIVE  OF THE SECOND GRADE DETAILED TO ACT AS DETECTIVE OF THE FIRST
 GRADE.
   § 2. This act shall take effect immediately.
   FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
   SUMMARY OF BILL: This proposed legislation would amend  Administrative
 Code  of  the  City  of New York Section 14-114 to allow for a Detective
 Third grade of the New York City Police Department (NYPD), who has  been
 a  Detective  Third grade for at least 15 years, to have the same rights
 in respect to the New York City Police Pension Fund (POLICE) as a Detec-
 tive Third grade detailed to act as a  Detective  Second  grade  and  to
 allow  for  a Detective Second grade of the New York City Police Depart-
 ment, who has been a Detective Second grade for at least  10  years,  to
 have  the  same  rights in respect to POLICE as a Detective Second grade
 detailed to act as a Detective First grade.
   Effective Date: Upon enactment.

  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD08615-02-3
              

 A. 7714                             2
 
   IMPACT ON BENEFITS: The proposed legislation would  permit  Detectives
 of  the  Third  and  Second grade, who have met certain service require-
 ments, to have their pension calculations based on a higher-grade  sala-
 ry.
   A  Detective  Third grade who would benefit under this proposed legis-
 lation, if enacted, would receive an increase in  their  annual  pension
 benefit  of  approximately  $8,600 per year and a Detective Second grade
 who would benefit under this proposed  legislation,  if  enacted,  would
 receive  an  increase  in  their annual pension benefit of approximately
 $11,500 per year, due to the assumed higher salary grade  and  overtime,
 and assuming a service retirement benefit with 20 years of service.
   Based on this increase and an estimate of the number of POLICE members
 that are expected to be impacted by this change, it is estimated that if
 this  proposed  legislation  is  enacted,  the annual increase in POLICE
 pension benefits paid will be approximately $1.3 million per year.
   With respect to an individual member, the impact on  benefits  due  to
 this  proposed  legislation could vary greatly depending on the member's
 age, years of service, retirement cause, and Tier.
   FINANCIAL IMPACT - PRESENT VALUES: Based on the actuarial  assumptions
 and methods described herein, the enactment of this proposed legislation
 would  increase  the Present Value of Future Benefits (PVFB) by approxi-
 mately $16.3 million every year.
   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 history
 of the member. Future years' costs would depend on the number  of  reti-
 rees who benefit under the legislation amongst other factors.
   The  estimate  of  the  increase  in annual employer contribitions for
 Fiscal Years 2025 through 2029, assuming  a  homogenous  population  and
 consistent retirement pattern, is shown in the table below.
 
                Fiscal         Increase in
                Year           Employer Contributions
                               ($ Millions)
 
                2025           $ 1.9
                2026           $ 3.8
                2027           $ 5.8
                2028           $ 7.7
                2029           $ 9.6
 
   Since the number of Detectives Third grade that will retire with 15 or
 more  years  in rank or Detectives Second grade that will retire with 10
 or more years in rank cannot be known in advance with  credibility,  the
 increase in PVFB due to this legislation has been treated as an actuari-
 al  loss  and  was  amortized  over a closed 15-year period (14 payments
 under the One-Year Lag Methodology) using level dollar payments.
   CENSUS DATA: These estimates are based on data provided  by  the  NYPD
 Detectives'  Endowment Association which was not audited but was checked
 for reasonableness. Below is a summary of the data provided:
   * Salary (excluding overtime and outstanding wage contract increases)
   * Detective Third grade - $114,999
   * Detective Second grade - $128,034
   * Detective First grade - $145,548
 A. 7714                             3
 
   * Detectives Third grade who retired with 15+  years  in  rank  -  522
 retired over the past 19 years.
   *  Detectives  Second grade who retired with 10+ years in rank - 1,783
 retired over the past 20 years.
   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 POLICE.
   For  the  purposes of this Fiscal Note, it is assumed that the changes
 would be reflected for the first time in the  June  30,  2023  actuarial
 valuation  of POLICE used to determine employer contributions for Fiscal
 Year 2025.
   The salaries for Detectives  provided  for  this  analysis  have  been
 adjusted  by  12.55% for assumed salary increases prior to June 30, 2022
 consistent with contract settlements and assumptions of pattern bargain-
 ing.
   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 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 2023-63 dated May 31,
 2023 was prepared by the Chief Actuary for  the  New  York  City  Police
 Pension  Fund.  This  estimate  is intended for use only during the 2023
 Legislative Session.