NY State Senate Bill 2023-S8465

Senate Bill S8465

2023-2024 Legislative Session

Relates to limiting participation by certain public or quasi-public organizations in the retirement system

download bill text pdf

Current Bill Status - In Senate Committee Civil Service And Pensions Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Feb 01, 2024	referred to civil service and pensions

2023-S8465 (ACTIVE) - Details

Current Committee:: Senate Civil Service And Pensions
Law Section:: Retirement and Social Security Law
Laws Affected:: Amd §§31 & 609, R & SS L

2023-S8465 (ACTIVE) - Summary

Relates to limiting participation by certain public or quasi-public organizations in the retirement system.

2023-S8465 (ACTIVE) - Sponsor Memo

                                 
BILL NUMBER: S8465

SPONSOR: SKOUFIS
 
TITLE OF BILL:

An act to amend the retirement and social security law, in relation to
participation by public or quasi-public organizations in the retirement
system

 
PURPOSE:

To amend the retirement and social security law, specifying eligibility
and service credit restrictions for certain organizations' employees.

 
SUMMARY OF PROVISIONS:

Section 1: Amends Subdivision a of section 31 of the retirement and
social security law, as amended by chapter 379 of the laws of 1989.
Allows any public or quasi-public organization to have their officers
and employees become eligible to participate in the retirement system.
However any officer or employee of the New York state association of
town superintendents of highways, inc., the New York state school boards

association, the New York state association of counties, the association
of towns of the state of New York, the New York conference of mayors and
other municipal officials, or any school board association, is not
eligible to participate in the retirement system if they are first
employed after the effective date of this bill.

Section 2: amends Section 609 of the retirement and social security law
by adding a new subdivision i.

Section 3: provides a severability clause.

Section 4: sets the effective date.

 
JUSTIFICATION:

The NYS retirement system is one of the largest in the nation - with
over a million participants and having a value of almost $160 billion.
The system is a benefit to hardworking public employees and it is a
benefit to state and local government in terms of attracting and retain-
ing qualified employees. As much as the retirement system is a benefit,
it is also a financial burden especially to local governments.

In recent years, the NYS Legislature has acted responsibly in passing
measures to help control the cost of the state pension system, partic-
ularly for local governments. And, although reform measures such as new
pension tiers have been established, there are still other problems with
the pension system that must be fixed. A prime example of this is the
state's law permitting employees of certain private organizations to
participate in the state's public retirement system.

Under current law, officers and employees of private organizations such
as the NYS Association of Counties, the NYS School Boards Association,
the Association of Towns of the State of New York, and the NYS Confer-
ence of Mayors are all eligible to participate in New York's retirement
system. Decades ago, these organizations applied for (and were granted)
this special privilege. Consequently, the state's public retirement
system includes certain private-sector employees that enjoy a special
benefit that other similarly situated private sector employees do not
have. A particularly troubling aspect of this arrangement is that, in
some cases, the officers and employees of these private organizations
are actually registered lobbyists. Ultimately, the state pensions for
these individuals increases costs for state and local government - costs
that are ultimately borne by New York residents. It is outrageous and
unfair to require New York residents to pay the costs of a public
pension for private sector lobbying organizations.

Another particularly irksome aspect of this situation is that these
groups regularly lobby New York state government officials to reduce the
high costs of pensions for local governments - the very costs that their
officers and employees are contributing to through the special privilege
they are taking advantage of. In fact, the NYS Association of Counties,
The NYS Conference of Mayors and the NYS Schools Boards Association have
all had pension reform on their lobbying agenda. To be sure, the NYS
retirement system is large and costs a lot of money.

There are many, many hard-working public employees that deserve a public
pension - and a pension system should be maintained for these individ-
uals. However, the fact that the current system provides a public
pension to private-sector lobbying organizations demands a fix. This
bill does just that.

 
LEGISLATIVE HISTORY:

New Bill

 
FISCAL IMPLICATIONS:

This bill will reduce the number of individuals eligible for the NYS
retirement system and will therefore reduce pension costs for NYS and
for local governments.

 
EFFECTIVE DATE:
This act shall take effect immediately.

2023-S8465 (ACTIVE) - Bill Text download pdf

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   8465
 
                             I N  S E N A T E
 
                             February 1, 2024
                                ___________
 
 Introduced  by  Sen. SKOUFIS -- 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
   participation  by  public or quasi-public organizations in the retire-
   ment system
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  Subdivision  a of section 31 of the retirement and social
 security law, as amended by chapter 379 of the laws of 1989, is  amended
 to read as follows:
   a. Any public or quasi-public organization created wholly or partly or
 deriving  its powers by the legislature of the state and which organiza-
 tion employs persons engaged in service to the public or any state agen-
 cy as defined in section fifty-three-a of the state finance law, or  the
 New  York state association of town superintendents of highways, inc. or
 any school board association,  by  resolution  legally  adopted  by  its
 governing  body  and  approved by the comptroller, may elect to have its
 officers and employees become eligible to participate in the  retirement
 system.    Acceptance  of the officers and employees of such an employer
 for membership in the retirement system shall be optional with the comp-
 troller. If he shall approve  their  participation,  such  organization,
 except  as  specifically provided in this article to the contrary, shall
 thereafter be treated as a participating  employer.  Any  election  made
 pursuant  to  this  subdivision  by  a school board association shall be
 applicable to current employees of such  association.    NOTWITHSTANDING
 THE  FOREGOING PROVISIONS, ANY OFFICER OR EMPLOYEE OF THE NEW YORK STATE
 ASSOCIATION OF TOWN SUPERINTENDENTS OF  HIGHWAYS,  INC.,  THE  NEW  YORK
 STATE SCHOOL BOARDS ASSOCIATION, THE NEW YORK STATE ASSOCIATION OF COUN-
 TIES,  THE  ASSOCIATION  OF TOWNS OF THE STATE OF NEW YORK, THE NEW YORK
 CONFERENCE OF MAYORS AND OTHER MUNICIPAL OFFICIALS, OR ANY SCHOOL  BOARD
 ASSOCIATION,  FIRST EMPLOYED ON OR AFTER THE EFFECTIVE DATE OF THE CHAP-
 TER OF THE LAWS OF TWO THOUSAND TWENTY-FOUR WHICH AMENDED THIS  SUBDIVI-
 SION, SHALL NOT BE ELIGIBLE TO PARTICIPATE AND/OR RECEIVE SERVICE CREDIT
 IN THE RETIREMENT SYSTEM BASED ON SUCH EMPLOYMENT.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.

                                                            LBD13944-02-4
 S. 8465                             2
 
   §  2. Section 609 of the retirement and social security law is amended
 by adding a new subdivision i to read as follows:
    I.  NOTWITHSTANDING  ANY OTHER PROVISION OF THIS SECTION OR ANY OTHER
 LAW, RULE OR REGULATION, AN OFFICER OR EMPLOYEE OF THE  NEW  YORK  STATE
 ASSOCIATION  OF  TOWN  SUPERINTENDENTS  OF  HIGHWAYS, INC., THE NEW YORK
 STATE SCHOOL BOARDS ASSOCIATION, THE NEW YORK STATE ASSOCIATION OF COUN-
 TIES, THE ASSOCIATION OF TOWNS OF THE STATE OF NEW YORK,  THE  NEW  YORK
 CONFERENCE  OF MAYORS AND OTHER MUNICIPAL OFFICIALS, OR ANY SCHOOL BOARD
 ASSOCIATION, SHALL NOT RECEIVE SERVICE CREDIT FOR EMPLOYMENT  WITH  SUCH
 ORGANIZATION ON OR AFTER THE EFFECTIVE DATE OF THIS SUBDIVISION.
   § 3. Severability clause. If any clause, sentence, paragraph, subdivi-
 sion,  section  or  part  of  this act shall be adjudged by any court of
 competent jurisdiction to be invalid, such judgment  shall  not  affect,
 impair,  or  invalidate  the remainder thereof, but shall be confined in
 its operation to the clause, sentence, paragraph,  subdivision,  section
 or part thereof directly involved in the controversy in which such judg-
 ment shall have been rendered. It is hereby declared to be the intent of
 the  legislature  that  this  act  would  have been enacted even if such
 invalid provisions had not been included herein.
   § 4. This act shall take effect immediately.
   FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
   This bill would deny eligibility for membership in the New York  State
 and  Local  Employees'  Retirement  System  (NYSLERS)  to  persons first
 employed by the following organizations on or after the effective date:
   1. The New York State Association of Town Superintendents of Highways,
 Inc.,
   2. The New York State School Boards Association,
   3. The New York State Association of Counties,
   4. The Association of Towns of the State of New York,
   5. The New York Conference of Mayors and  Other  Municipal  Officials,
 and
   6. any school board association.
   Further,   this  legislation  would  disallow  future  service  credit
 accruals for employment rendered on and  after  the  effective  date  by
 current  members  of  the NYSLERS employed by such organizations. There-
 fore, if enacted into law, this bill is likely to face a  constitutional
 challenge  based  upon the guarantee that a member's benefits may not be
 diminished.
   If this bill is enacted into  law,  there  will  be  no  cost  to  the
 NYSLERS.
   Summary of relevant resources:
   Membership  data as of March 31, 2023 was used in measuring the impact
 of the proposed change, the same data used in the April 1, 2023 actuari-
 al valuation. Distributions and other statistics can  be  found  in  the
 2023  Report  of the Actuary and the 2023 Annual Comprehensive Financial
 Report.
   The actuarial assumptions and methods used are described in  the  2023
 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, 2023
 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.
 S. 8465                             3
 
   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  25,  2024,  and intended for use only
 during the  2024  Legislative  Session,  is  Fiscal  Note  No.  2024-76,
 prepared  by  the  Actuary  for  the New York State and Local Retirement
 System.

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