S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  8720--A
 
                        2025-2026 Regular Sessions
 
                           I N  A S S E M B L Y
 
                               June 2, 2025
                                ___________
 
 Introduced  by  M.  of A. STIRPE, STECK -- read once and referred to the
   Committee on Governmental  Employees  --  committee  discharged,  bill
   amended,  ordered reprinted as amended and recommitted to said commit-
   tee
 
 AN ACT to amend the retirement and social security law, in  relation  to
   increasing the earning limitations for retired persons in positions of
   public service
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Section 212 of the retirement and social  security  law  is
 amended by adding a new subdivision 2-a to read as follows:
   2-A.  NOTWITHSTANDING  THE  PROVISIONS  OF  SUBDIVISION  TWO  OF  THIS
 SECTION, THE EARNINGS LIMITATION FOR RETIRED PERSONS IN  A  POSITION  OF
 PUBLIC  SERVICE  SHALL  BE  INCREASED TO FIFTY THOUSAND DOLLARS FROM THE
 YEAR TWO THOUSAND TWENTY-FIVE AND THEREAFTER.
   § 2. This act shall take effect immediately.
   FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
   This bill would allow a retired person from the  New  York  State  and
 Local  Retirement System who returns to public employment with an annual
 salary of $50,000 or less to continue to receive their  full  retirement
 benefit.  Currently, the salary limit is $35,000.
   Insofar  as  this bill affects the New York State and Local Employees'
 Retirement System (NYSLERS), if this bill were enacted during  the  2025
 Legislative  Session,  the  direct  cost incurred would be the retiree's
 pension benefit paid while post-retirement earnings are between  $35,000
 and  $50,000 each calendar year. The pension benefit expected to be paid
 by NYSLERS during that 2.5-month period is estimated to  be  $9,000  per
 person.
   In addition to the direct cost quoted above, there would be additional
 costs  in  the  form  of lost employer contributions due to non-billable
 post-retirement earnings, which are estimated to be $2,250 per person.

  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD03695-05-5
              

 A. 8720--A                          2
 
   In NYSLERS, pursuant to Section 25 of the Retirement and Social  Secu-
 rity  Law,  the  increased costs would be borne entirely by the State of
 New York and would require an itemized appropriation sufficient  to  pay
 the  cost  of  the  provision. For each retiree rehired pursuant to this
 proposal, an annual cost of $11,250 is expected.
   Insofar  as  this bill affects the New York State and Local Police and
 Fire Retirement System (NYSLPFRS), if this bill were enacted during  the
 2025  Legislative  Session,  the  direct  cost  incurred  would  be  the
 retiree's  pension  benefit  paid  while  post-retirement  earnings  are
 between  $35,000  and  $50,000  each  calendar year. The pension benefit
 expected to be paid by NYSLPFRS during that 1-month period is  estimated
 to be $7,500 per person.
   In addition to the direct cost quoted above, there would be additional
 costs  in  the  form  of lost employer contributions due to non-billable
 post-retirement earnings, which are estimated to be $4,500 per person.
   All costs will be shared by the State of New York and all  participat-
 ing  employers  in  NYSLPFRS  and spread over future billing cycles. For
 each retiree rehired pursuant  to  this  proposal,  an  annual  cost  of
 $12,000 is expected.
   In addition to the direct costs quoted above, insofar as this proposal
 disrupts  the usual pattern and timing of employee turnover (that is, if
 members retire earlier than assumed and participating employers  hire  a
 retiree  instead  of  a  new billable member), shifts in member behavior
 could generate losses that increase the average billing rate in  20-year
 and 25-year service-based plans from 33.7% to 43.3%. In age-based plans,
 average  billing  rates  could  increase from 16.5% to 19.9%. The actual
 increase in billing rates will depend upon member and employer  utiliza-
 tion, with the rates above representing an upper maximum.
   Because  this  proposal  exclusively  benefits retirees, the increased
 costs are primarily attributable to retirees from  Tiers  1-4.  Approxi-
 mately  half  the  contributions  required to fund this proposal will be
 collected on salary reported for current members of Tier 6.
   Summary of relevant resources:
   Membership data as of March 31, 2024 was used in measuring the  impact
 of the proposed change, the same data used in the April 1, 2024 actuari-
 al  valuation.  Distributions  and  other statistics can be found in the
 2024 Report of the Actuary and the 2024 Annual  Comprehensive  Financial
 Report.  The actuarial assumptions and methods used are described in the
 2024  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, 2024 New York State and Local Retirement System Financial Statements
 and Supplementary Information.
   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 March 12, 2025, and intended for use only  during
 the 2025 Legislative Session, is Fiscal Note No. 2025-71. As Chief Actu-
 ary of the New York State and Local Retirement System, I, Aaron Schottin
 Young,  hereby certify that this analysis complies with applicable Actu-
 arial Standards of Practice as well as the Code of Professional  Conduct
 and Qualification Standards for Actuaries Issuing Statements of Actuari-
 al Opinion of the American Academy of Actuaries, of which I am a member.
   FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
   This  bill  would  add  a  new  subdivision  2-a to Section 212 of the
 Retirement and Social Security Law to  increase  the  earnings-after-re-
 A. 8720--A                          3
 
 tirement limitation to $50,000 for retired members who return to work in
 positions  of  public  employment for calendar year 2025 and thereafter.
 Currently this earnings limitation is  $35,000.  There  is  no  earnings
 limitation for retirees age 65 and above.
   It  is  expected  that  this increase in the earnings-after-retirement
 limit could have an  impact  on  the  Retirement  System's  patterns  of
 retirement  resulting  in some members retiring earlier than they other-
 wise would have. Earlier retirement generally increases plan costs since
 members will be receiving their benefits for a longer period. If retire-
 ment patterns shift more than expected, there will be additional costs.
   The annual cost to the employers of members  of  the  New  York  State
 Teachers'  Retirement  System  for this benefit is estimated to be $91.2
 million or 0.45% of payroll if this bill is enacted.
   Member data is from the System's most recent actuarial valuation files
 as of June 30, 2024, consisting of data provided by the employers to the
 Retirement System. The most recent data distributions and statistics can
 be found in the System's Annual Report for fiscal year  ended  June  30,
 2024. System assets are as reported in the System's financial statements
 and  can  also be found in the System's Annual Report. Actuarial assump-
 tions and methods will be provided in the System's  Actuarial  Valuation
 Report  as  of  June  30, 2024. The retirement assumption which has been
 modified from this report to reflect earlier patterns of retirement.
   The source of this estimate is Fiscal Note 2025-24 dated May 29,  2025
 prepared  by  the  Office of the Actuary of the New York State Teachers'
 Retirement System and is intended for use only during the 2025  Legisla-
 tive Session. I, Richard A. Young, am the Chief Actuary for the New York
 State Teachers' Retirement System. I am a member of the American Academy
 of  Actuaries  and  I  meet  the Qualification Standards of the American
 Academy of Actuaries to render the actuarial opinion contained herein.
   FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
   SUMMARY: This proposed legislation would increase the $35,000  Retire-
 ment  and  Social Security Law (RSSL) Section 212 post-retirement public
 employment earnings limit to $50,000 for calendar  year  2025  and  each
 year thereafter for certain New York City Retirement Systems and Pension
 Funds (NYCRS) retirees who return to public service.
 
         ILLUSTRATION - ADDITIONAL RETIREMENT ALLOWANCE TO BE PAID
   Annual             Annual Post-Retirement Earnings in Calendar Year
 Retirement
  Allowance    $40,000    $50,000     $60,000      $70,000     $80,000
   $30,000       $3,750     $9,000      $7,500       $6,429      $5,625
   $40,000       $5,000    $12,000     $10,000       $8,571      $7,500
   $50,000       $6,250    $15,000     $12,500      $10,714      $9,375
   $60,000       $7,500    $18,000     $15,000      $12,857     $11,250
   $70,000       $8,750    $21,000     $17,500      $15,000     $13,125
   $80,000      $10,000    $24,000     $20,000      $17,143     $15,000
   $90,000      $11,250    $27,000     $22,500      $19,286     $16,875
  $100,000      $12,500    $30,000     $25,000      $21,429     $18,750
 
   The resulting increases in employer contributions will be allocated to
 New York City and other applicable obligors of NYCRS.
   CENSUS  DATA: The number of retirees who will return to public service
 in the future is unknown  and  the  portion  of  the  pension  allowance
 suspended  is highly dependent on their salary earned. The results above
 illustrate the additional pension amount that would be paid  under  this
 A. 8720--A                          4
 
 legislation  given  a  retiree's  post-retirement  earnings  and pension
 allowance.
   The  preliminary  census  data  collected  as of June 30, 2024 for the
 potentially impacted service retiree population is summarized below.
 
                        NYCERS      TRS      BERS     POLICE     FIRE
   Receiving Members
   - Number Count:      21,977    10,531     2,157    24,530     1,243
   - Average Age:         60.1      61.0      61.8      56.4      56.5
   - Average Benefit:   45,300    57,200    18,800    71,800    96,600
 
   IMPACT ON PENSION PAYMENTS: Retirees below age 65 who return to public
 service and elect to be covered under the provisions of RSSL Section 212
 are permitted to earn an amount not exceeding a specific dollar limit in
 each calendar year. Once this dollar limit  is  reached,  the  retiree's
 retirement  allowance  is  suspended  for the remainder of that calendar
 year. The amount of the retirement  allowance  suspended  is  contingent
 upon  both  individual  post-retirement  earnings  and annual retirement
 allowances.
   Currently, the  post-retirement  earnings  limitation  in  effect  for
 calendar  year  2020  and  each  year  thereafter  is $35,000. Under the
 proposed legislation, the post-retirement earnings limitation  would  be
 increased to $50,000 for calendar year 2025 and each year thereafter.
   ASSUMPTIONS  AND  METHODS:  For  illustrative purposes only, the table
 above presents  the  estimated  additional  retirement  allowances  paid
 (i.e., those benefits that would not be subject to suspension) for vari-
 ous  sample  combinations  of post-retirement annual earnings and annual
 retirement allowance amounts.
   RISK AND UNCERTAINTY: The costs presented in this Fiscal  Note  depend
 highly  on  the  actuarial  assumptions, methods, and models used, demo-
 graphics of the impacted population, and other factors such  as  invest-
 ment,  contribution, and other risks. If actual experience deviates from
 actuarial  assumptions,  the  actual  costs  could  differ  from   those
 presented  herein.  Quantifying  these risks is beyond the scope of this
 Fiscal Note.
   This Fiscal Note is intended to measure  pension-related  impacts  and
 does  not  include other potential costs (e.g., administrative and Other
 Postemployment Benefits).  This Fiscal Note does not reflect any chapter
 laws that may have been enacted during the current legislative session.
   STATEMENT OF ACTUARIAL OPINION: Marek Tyszkiewicz and Gregory Zelikov-
 sky are members of the Society of Actuaries and the American Academy  of
 Actuaries.  We  are members of NYCERS, but do not believe it impairs our
 objectivity, and we meet the Qualification  Standards  of  the  American
 Academy  of  Actuaries to render the actuarial opinion contained herein.
 To the best of our 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 2025-77 dated June 6,
 2025 was prepared by the Chief Actuary for the New York City  Retirement
 Systems  and  Pension Funds and is intended for use only during the 2025
 Legislative Session.