Bill Text: NY A03636 | 2013-2014 | General Assembly | Introduced
Bill Title: Authorizes the state and certain local governments to establish other post employment benefits (OPEB) trusts; establishes the other post employment benefits (OPEB) investment fund.
Spectrum: Partisan Bill (Democrat 2-0)
Status: (Introduced - Dead) 2014-01-08 - referred to governmental employees [A03636 Detail]
Download: New_York-2013-A03636-Introduced.html
S T A T E O F N E W Y O R K ________________________________________________________________________ 3636 2013-2014 Regular Sessions I N A S S E M B L Y January 28, 2013 ___________ Introduced by M. of A. ABBATE -- (at request of the State Comptroller) -- read once and referred to the Committee on Governmental Employees AN ACT to amend the state finance law, the civil service law and the general municipal law, in relation to authorizing the state and certain local governments to establish other post employment benefits (OPEB) trusts and establishing the other post employment benefits (OPEB) investment fund THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: 1 Section 1. The state finance law is amended by adding a new section 2 97-llll to read as follows: 3 S 97-LLLL. OTHER POST EMPLOYMENT BENEFITS ("OPEB") INVESTMENT FUND. 1. 4 THERE IS HEREBY ESTABLISHED IN THE SOLE CUSTODY OF THE STATE COMPTROLLER 5 A SPECIAL INVESTMENT FUND TO BE KNOWN AS THE OTHER POST EMPLOYMENT BENE- 6 FITS INVESTMENT FUND. 7 2. FOR PURPOSES OF THIS SECTION: 8 (A) "FUND" SHALL MEAN THE OTHER POST EMPLOYMENT BENEFITS INVESTMENT 9 FUND CREATED BY THIS SECTION; 10 (B) "COMPTROLLER" SHALL MEAN THE STATE COMPTROLLER; 11 (C) "STATE" SHALL MEAN THE STATE OF NEW YORK; 12 (D) "LOCAL GOVERNMENT" SHALL HAVE THE SAME MEANING AS SET FORTH IN 13 PARAGRAPH (A) OF SUBDIVISION ONE OF SECTION SIX-T OF THE GENERAL MUNICI- 14 PAL LAW; 15 (E) "OTHER PUBLIC CORPORATION" SHALL MEAN ANY PUBLIC CORPORATION OTHER 16 THAN A LOCAL GOVERNMENT THAT IS AUTHORIZED TO ESTABLISH AN IRREVOCABLE 17 TRUST; AND 18 (F) "PARTICIPATING TRUSTEE" SHALL MEAN THE TRUSTEE FOR THE STATE, AND 19 THE TRUSTEE FOR ANY LOCAL GOVERNMENT OR ANY OTHER PUBLIC CORPORATION 20 THAT INVESTS MONEYS IN THE FUND PURSUANT TO THIS SECTION. 21 3. THE FUND SHALL CONSIST OF ALL MONEYS PAID TO THE COMPTROLLER BY THE 22 STATE PURSUANT TO SECTION ONE HUNDRED SIXTY-NINE OF THE CIVIL SERVICE EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD04651-02-3 A. 3636 2 1 LAW, BY LOCAL GOVERNMENTS PURSUANT TO SECTION SIX-T OF THE GENERAL 2 MUNICIPAL LAW AND BY ANY OTHER PUBLIC CORPORATION THAT ESTABLISHES AN 3 OTHER POST EMPLOYMENT BENEFITS TRUST. THE MONEYS IN THE FUND SHALL NOT 4 BE WITHIN THE STATE TREASURY, AND SHALL NOT BE DEEMED TO BE STATE FUNDS 5 FOR ANY PURPOSE. NOTWITHSTANDING THE PROVISIONS OF SECTION FOUR OF THIS 6 CHAPTER, OR ANY OTHER PROVISION OF LAW, MONEYS MAY BE DISBURSED FROM THE 7 FUND FOR ANY AUTHORIZED PURPOSE WITHOUT APPROPRIATION. 8 4. NOTWITHSTANDING ANY OTHER PROVISION OF LAW, THE MONEYS IN THE FUND 9 MAY BE INVESTED BY THE COMPTROLLER IN ACCORDANCE WITH THE INVESTMENT 10 OPTIONS SELECTED PURSUANT TO THE WRITTEN INVESTMENT POLICY DEVELOPED BY 11 EACH PARTICIPATING TRUSTEE IN ANY INVESTMENTS IN COMPLIANCE WITH THE 12 FOLLOWING STANDARDS: 13 (A) THE COMPTROLLER SHALL EXERCISE SUCH JUDGMENT, CARE, SKILL, 14 PRUDENCE AND DILIGENCE UNDER THE CIRCUMSTANCES THEN PREVAILING THAT A 15 KNOWLEDGEABLE AND PRUDENT INVESTOR ACTING IN A LIKE CAPACITY AND FAMIL- 16 IAR WITH SUCH MATTERS WOULD USE IN THE CONDUCT OF AN ENTERPRISE OF A 17 LIKE CHARACTER AND WITH LIKE AIMS; AND 18 (B) THE COMPTROLLER SHALL PRUDENTLY DIVERSIFY THE INVESTMENT OF THE 19 FUND'S PORTFOLIO AMONG INVESTMENT TYPES AND WITHIN INVESTMENT TYPES IN A 20 MANNER CONSISTENT WITH THE FOREGOING UNLESS UNDER THE CIRCUMSTANCES IT 21 IS CLEARLY PRUDENT NOT TO DO SO. 22 5. THE COMPTROLLER SHALL MAINTAIN A SEPARATE ACCOUNT FOR EACH PARTIC- 23 IPATING TRUSTEE. HOWEVER, MONEYS OF PARTICIPATING TRUSTEES MAY BE 24 COMMINGLED FOR THE COMPTROLLER'S INVESTMENT PURPOSES, PROVIDED THAT THE 25 MONEY OF EACH PARTICIPATING TRUSTEE SHALL BE SEPARATELY ACCOUNTED FOR. 26 6. THE COMPTROLLER SHALL, WITHIN HIS OR HER DISCRETION, ESTABLISH 27 SUB-FUNDS AND INVEST SUCH SUB-FUNDS SEPARATELY TO PROVIDE PARTICIPATING 28 TRUSTEES WITH A NUMBER OF OPTIONS TO MEET VARIOUS INVESTMENT OBJECTIVES. 29 SUCH OPTIONS SHALL REFLECT VARYING LEVELS OF RISK FOR SUCH INVESTMENT. 30 INVESTMENT EARNINGS SHALL BE PRORATED AMONG PARTICIPATING TRUSTEES IN 31 EACH SUB-FUND IN PROPORTION TO THE AMOUNT OF INVESTMENTS HELD BY PARTIC- 32 IPATING TRUSTEES. 33 7. THE COMPTROLLER MAY HIRE SUCH OFFICERS AND EMPLOYEES AND CONTRACT 34 WITH SUCH ADVISORS AND AGENTS AS THE COMPTROLLER DEEMS NECESSARY FOR THE 35 MANAGEMENT AND INVESTMENT OF MONEYS IN THE FUND. ANY OFFICERS AND 36 EMPLOYEES EMPLOYED BY THE COMPTROLLER FOR THE MANAGEMENT AND INVESTMENT 37 OF MONEYS IN THE FUND SHALL BE OFFICERS AND EMPLOYEES OF THE COMP- 38 TROLLER, PROVIDED, HOWEVER, THAT ANY COSTS ASSOCIATED WITH THE EMPLOY- 39 MENT OF SUCH OFFICERS AND EMPLOYEES AND ANY ADVISORS OR AGENTS SHALL BE 40 CHARGED AGAINST THE FUND. SUCH CHARGES SHALL BE INCLUDED IN THE ADMINIS- 41 TRATIVE FEE CHARGED TO PARTICIPATING TRUSTEES IN THE FUND. 42 8. THE COMPTROLLER SHALL ENTER INTO AN AGREEMENT WITH EACH PARTICIPAT- 43 ING TRUSTEE. EACH SUCH AGREEMENT SHALL INCLUDE, BUT NOT BE LIMITED TO, 44 THE FOLLOWING TERMS: 45 (A) A STATEMENT THAT THE COMPTROLLER SHALL BE UNDER NO OBLIGATION TO 46 REVIEW OR VERIFY THE ESTIMATED COSTS OF BENEFITS TO BE FUNDED WITH MONEY 47 CONTRIBUTED TO THE FUND; 48 (B) A PROVISION THAT THE PARTICIPATING TRUSTEE SHALL DETERMINE THE 49 AMOUNTS OF MONEY TO BE CONTRIBUTED TO THE FUND AND DESIGNATE THE 50 SUB-FUNDS IN WHICH THE MONEYS SHALL BE INVESTED. THE COMPTROLLER SHALL 51 ACCEPT SUCH AMOUNTS AND HIS OR HER ONLY RESPONSIBILITY SHALL BE TO 52 INVEST THE MONEYS IN THE SUB-FUNDS DIRECTED BY THE PARTICIPATING TRUSTEE 53 AND TO REPORT THE CONTRIBUTIONS, WITHDRAWALS, BALANCES AND EARNINGS, TO 54 THE PARTICIPATING TRUSTEE ON A REGULAR BASIS TO BE SET FORTH IN THE 55 AGREEMENT, BUT NO LESS FREQUENTLY THAN ANNUALLY; A. 3636 3 1 (C) A STATEMENT THAT IT SHALL BE THE RESPONSIBILITY OF THE PARTICIPAT- 2 ING TRUSTEE TO DETERMINE COSTS ELIGIBLE TO BE FUNDED FROM MONEYS IN THE 3 FUND AND THE COMPTROLLER'S ONLY OBLIGATION SHALL BE TO MAKE PAYMENTS ON 4 THE DATES AND IN THE AMOUNTS REQUESTED BY THE PARTICIPATING TRUSTEE; 5 (D) A REQUIREMENT THAT THE PARTICIPATING TRUSTEE SHALL ANNUALLY, ON A 6 DATE PROVIDED IN THE AGREEMENT, PROVIDE THE COMPTROLLER WITH A SCHEDULE 7 OR AMENDED SCHEDULE OF MONEYS EXPECTED TO BE CONTRIBUTED TO THE FUND AND 8 WITHDRAWALS EXPECTED TO BE MADE FROM ITS ACCOUNT. SUCH SCHEDULE SHALL BE 9 BINDING ON THE PARTICIPATING TRUSTEE; 10 (E) A PROVISION THAT THE MONEY IN THE FUND SHALL BE PAID TO THE 11 PARTICIPATING TRUSTEE OR ITS DESIGNEE UPON REQUISITION AS PROVIDED IN 12 THE AGREEMENT; 13 (F) A PROVISION FOR THE ASSESSMENT OF ADMINISTRATIVE COSTS, INVESTMENT 14 FEES AND OTHER CHARGES, INCLUDING ANY PENALTIES TO BE IMPOSED FOR EARLY 15 OR EXCESSIVE WITHDRAWALS, AND FOR THE DEDUCTION OF SUCH FEES AND CHARGES 16 FROM INVESTMENT EARNINGS; 17 (G) A STATEMENT BY THE PARTICIPATING TRUSTEE RELATING TO ITS CONSIDER- 18 ATION OF THE RISKS INVOLVED IN THE INVESTMENT SUB-FUNDS TO WHICH IT IS 19 ALLOCATING ITS MONEYS AND ITS UNDERSTANDING OF ITS RESPONSIBILITY FOR 20 ANY LOSSES RESULTING FROM SUCH RISKS; 21 (H) A STATEMENT THAT NEITHER THE COMPTROLLER NOR ANY OFFICER, EMPLOY- 22 EE, AGENT OR ADVISOR OF THE COMPTROLLER SHALL BE LIABLE FOR ANY LOSS OR 23 EXPENSE SUFFERED BY THE FUND IN THE ABSENCE OF BAD FAITH, WILLFUL 24 MISCONDUCT OR INTENTIONAL WRONGDOING; AND 25 (I) A PROVISION FOR THE TERMINATION OF THE PARTICIPATING TRUSTEE'S 26 INCLUSION IN THE FUND, INCLUDING THE DISPOSITION AND/OR TRANSFER OF 27 ACCUMULATED ASSETS. 28 S 2. The civil service law is amended by adding a new section 169 to 29 read as follows: 30 S 169. OTHER POST EMPLOYMENT BENEFITS ("OPEB") TRUST. 1. FOR PURPOSES 31 OF THIS SECTION: 32 (A) "PRESIDENT" SHALL MEAN THE PRESIDENT OF THE CIVIL SERVICE COMMIS- 33 SION AS HEAD OF THE DEPARTMENT OF CIVIL SERVICE; 34 (B) "STATE" SHALL MEAN THE STATE OF NEW YORK; 35 (C) "FUND" SHALL MEAN THE OTHER POST EMPLOYMENT BENEFITS INVESTMENT 36 FUND CREATED BY SECTION NINETY-SEVEN-LLLL OF THE STATE FINANCE LAW; AND 37 (D) "OTHER POST EMPLOYMENT BENEFITS" SHALL MEAN BENEFITS, EXCEPT 38 PENSIONS OR OTHER BENEFITS FUNDED THROUGH A PUBLIC RETIREMENT SYSTEM, 39 PROVIDED OR TO BE PROVIDED BY THE STATE AS COMPENSATION, WHETHER PURSU- 40 ANT TO STATUTE, CONTRACT OR OTHER LAWFUL AUTHORITY, TO ITS CURRENT OR 41 FORMER OFFICERS OR EMPLOYEES, OR THEIR FAMILIES OR BENEFICIARIES, AFTER 42 SERVICE TO THE STATE HAS ENDED, INCLUDING, BUT NOT LIMITED TO, HEALTH 43 CARE BENEFITS. THE TERM "OTHER POST EMPLOYMENT BENEFITS" SHALL NOT 44 INCLUDE CASH PAYMENTS FOR THE MONETARY VALUE OF SICK LEAVE, VACATION OR 45 OTHER SIMILAR ACCRUALS, RETIREMENT INCENTIVE OR SEPARATION PAYMENTS, OR 46 BENEFITS PROVIDED PURSUANT TO THE CONSOLIDATED OMNIBUS BUDGET RECONCIL- 47 IATION ACT OF 1985 (PUBLIC LAW 99-272), AS AMENDED. 48 2. THE PRESIDENT MAY ESTABLISH A TRUST IN HIS OR HER CUSTODY FOR THE 49 PURPOSE OF ACCUMULATING ASSETS TO FUND THE COST OF PROVIDING OTHER POST 50 EMPLOYMENT BENEFITS. CONTRIBUTIONS TO SUCH TRUST MAY BE MADE BY STATE 51 APPROPRIATION. 52 3. THE PRESIDENT IS HEREBY DECLARED TO BE THE TRUSTEE OF THE TRUST 53 ESTABLISHED PURSUANT TO THIS SECTION. AS TRUSTEE THE PRESIDENT SHALL BE 54 RESPONSIBLE FOR THE OPERATION AND MANAGEMENT OF THE TRUST, INCLUDING THE 55 INVESTMENT OF TRUST ASSETS, AND SHALL BE SUBJECT TO ALL THE DUTIES AND A. 3636 4 1 RESPONSIBILITIES IMPOSED BY LAW ON TRUSTEES, EXCEPT TO THE EXTENT INCON- 2 SISTENT WITH THIS SECTION. 3 4. CONTRIBUTIONS TO THE TRUST, AND ANY INTEREST OR OTHER INCOME OR 4 EARNINGS ON CONTRIBUTIONS, SHALL BE IRREVOCABLE BEFORE ALL LIABILITIES 5 OF THE STATE GOVERNMENT FOR OTHER POST EMPLOYMENT BENEFITS HAVE BEEN 6 SATISFIED AND SHALL BE SOLELY DEDICATED TO, AND USED SOLELY FOR, PROVID- 7 ING OTHER POST EMPLOYMENT BENEFITS AND PAYING APPROPRIATE AND REASONABLE 8 EXPENSES OF ADMINISTERING THE TRUST. NO ASSETS, INCOME, EARNINGS OR 9 DISTRIBUTIONS OF THE TRUST SHALL BE SUBJECT TO ANY CLAIM OF CREDITORS OF 10 THE STATE, OR TO ASSIGNMENT OR EXECUTION, ATTACHMENT OR ANY OTHER CLAIM 11 ENFORCEMENT PROCESS INITIATED BY OR ON BEHALF OF SUCH CREDITORS. EXCEPT 12 AS OTHERWISE PROVIDED IN SUBDIVISION NINE OF THIS SECTION, THE PRESIDENT 13 SHALL NOT BE RESPONSIBLE FOR THE ADEQUACY OF THE ASSETS OF THE TRUST TO 14 MEET ANY OTHER POST EMPLOYMENT BENEFIT. THE PRESIDENT SHALL NOT BE 15 RESPONSIBLE FOR TAKING ANY ACTION TO ENFORCE THE PAYMENT OF ANY APPRO- 16 PRIATION INTO THE TRUST. THE TRUST MAY BE TERMINATED ONLY WHEN ALL 17 LIABILITIES OF THE STATE FOR OTHER POST EMPLOYMENT BENEFITS HAVE BEEN 18 SATISFIED AND THERE IS NO PRESENT OR FUTURE OBLIGATION, CONTINGENT OR 19 OTHERWISE, OF THE STATE TO PROVIDE SUCH OTHER POST EMPLOYMENT BENEFITS. 20 UPON SUCH TERMINATION, ANY REMAINING TRUST ASSETS, AFTER ANY PROPER 21 EXPENSES OF THE TRUST HAVE BEEN PAID, SHALL REVERT TO THE STATE. 22 5. WITHDRAWALS FROM THE TRUST SHALL BE MADE FOR THE SOLE PURPOSE OF 23 PROVIDING FUNDS FOR THE COSTS OF OTHER POST EMPLOYMENT BENEFITS CURRENT- 24 LY DUE AND PAYABLE BY THE STATE. 25 6. THE PRESIDENT MAY CONTRACT TO OBTAIN SERVICES NECESSARY FOR THE 26 MANAGEMENT AND OPERATION OF THE TRUST, INCLUDING THE PROFESSIONAL 27 SERVICES NECESSARY TO CARRY OUT HIS OR HER RESPONSIBILITIES AS TRUSTEE. 28 CONTRACTS FOR SUCH SERVICES SHALL BE LET PURSUANT TO THE PROVISIONS OF 29 THE STATE FINANCE LAW APPLICABLE TO STATE CONTRACTS. 30 7. THE PRESIDENT SHALL MANAGE THE ASSETS OF THE TRUST IN A CAREFUL AND 31 PRUDENT MANNER. THE PRESIDENT MAY INVEST ASSETS OF THE TRUST ONLY BY 32 PAYMENT TO THE FUND IN ACCORDANCE WITH SECTION NINETY-SEVEN-LLLL OF THE 33 STATE FINANCE LAW. ANY INTEREST OR OTHER INCOME OR EARNINGS RESULTING 34 FROM THE INVESTMENT OF ASSETS OF THE TRUST SHALL ACCRUE TO AND BECOME 35 PART OF THE ASSETS OF THE TRUST. 36 8. THE PRESIDENT SHALL DEVELOP, IN CONSULTATION WITH THE STATE HEALTH 37 INSURANCE COUNCIL, A WRITTEN INVESTMENT POLICY FOR SELECTING AMONG THE 38 INVESTMENT OPTIONS OFFERED BY THE STATE COMPTROLLER PURSUANT TO SECTION 39 NINETY-SEVEN-LLLL OF THE STATE FINANCE LAW SO THAT THE COMPTROLLER MAY 40 BE ABLE TO INVEST FUND MONIES IN ACCORDANCE WITH SUCH POLICY. SUCH 41 POLICY SHALL INCLUDE A STATEMENT OF INVESTMENT OBJECTIVES ADDRESSING, IN 42 THE FOLLOWING ORDER OF PRIORITY, THE ABILITY TO TIMELY MEET DISBURSEMENT 43 REQUESTS WITHOUT FORCED SALE OF ASSETS, SAFETY OF PRINCIPAL AND ATTAIN- 44 MENT OF MARKET RATES OF RETURN. 45 9. NEITHER THE STATE NOR THE PRESIDENT SHALL BE LIABLE FOR ANY LOSS OR 46 EXPENSE SUFFERED BY THE TRUST IN THE ABSENCE OF BAD FAITH, WILLFUL 47 MISCONDUCT OR INTENTIONAL WRONGDOING. THE PRESIDENT SHALL BE CONSIDERED 48 TO BE ACTING AS AN OFFICER OF THE STATE FOR PURPOSES OF SECTION SEVEN- 49 TEEN OF THE PUBLIC OFFICERS LAW, PROVIDED, HOWEVER, THAT THE COSTS OF 50 ANY DEFENSE OR INDEMNIFICATION OF THE PRESIDENT ARISING FROM THE EXER- 51 CISE OF THE FUNCTIONS OF TRUSTEE SHALL BE PAYABLE FROM THE ASSETS OF THE 52 TRUST. 53 10. THE PRESIDENT SHALL PREPARE OR CAUSE TO BE PREPARED AN ANNUAL 54 FINANCIAL REPORT OF ASSETS, LIABILITIES, REVENUES AND EXPENSES OF THE 55 TRUST IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES. THE 56 PRESIDENT SHALL CAUSE THE ACTIVITIES UNDERTAKEN IN CONNECTION WITH THE A. 3636 5 1 TRUST, INCLUDING THE ANNUAL FINANCIAL REPORT, TO BE AUDITED ANNUALLY, IN 2 ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS, BY AN INDEPENDENT 3 CERTIFIED PUBLIC ACCOUNTANT ENGAGED IN A MANNER CONSISTENT WITH THE 4 APPLICABLE PROVISIONS OF THE STATE FINANCE LAW. THE AUDIT SHALL BE 5 COMPLETED WITHIN ONE HUNDRED TWENTY DAYS FROM THE CLOSE OF THE STATE'S 6 FISCAL YEAR. A COPY OF THE ANNUAL FINANCIAL REPORT AND THE REPORT OF 7 SUCH AUDIT SHALL BE PROVIDED TO THE GOVERNOR, THE STATE COMPTROLLER AND 8 THE CHAIRS OF THE LEGISLATIVE FISCAL COMMITTEES. 9 11. NOTHING CONTAINED IN THIS SECTION SHALL BE INTERPRETED OR 10 CONSTRUED TO: 11 (A) CREATE ANY OBLIGATION IN, IMPOSE ANY OBLIGATION ON, OR ALTER ANY 12 OBLIGATION OF THE STATE TO PROVIDE OTHER POST EMPLOYMENT BENEFITS; 13 (B) LIMIT OR RESTRICT THE AUTHORITY OF THE STATE TO MODIFY OR ELIMI- 14 NATE OTHER POST EMPLOYMENT BENEFITS; 15 (C) ASSURE OR DENY OTHER POST EMPLOYMENT BENEFITS; OR 16 (D) REQUIRE THE STATE TO FUND ITS LIABILITY FOR OTHER POST EMPLOYMENT 17 BENEFITS. 18 S 3. The general municipal law is amended by adding a new section 6-t 19 to read as follows: 20 S 6-T. OTHER POST EMPLOYMENT BENEFITS (OPEB) TRUST. 1. FOR PURPOSES OF 21 THIS SECTION: 22 (A) "LOCAL GOVERNMENT" SHALL MEAN A MUNICIPAL CORPORATION, SCHOOL 23 DISTRICT, BOARD OF COOPERATIVE EDUCATIONAL SERVICES, DISTRICT CORPO- 24 RATION, SPECIAL IMPROVEMENT DISTRICT GOVERNED BY A SEPARATE BOARD OF 25 COMMISSIONERS, COMMUNITY COLLEGE OR PUBLIC LIBRARY THAT PROVIDES OTHER 26 POST EMPLOYMENT BENEFITS. 27 (B) "OTHER POST EMPLOYMENT BENEFITS" SHALL MEAN BENEFITS, EXCEPT 28 PENSIONS OR OTHER BENEFITS FUNDED THROUGH A PUBLIC RETIREMENT SYSTEM, 29 PROVIDED OR TO BE PROVIDED AS COMPENSATION BY THE LOCAL GOVERNMENT, 30 WHETHER PURSUANT TO STATE STATUTE, LOCAL ENACTMENT, CONTRACT OR OTHER 31 LAWFUL AUTHORITY, TO ITS FORMER OR CURRENT OFFICERS OR EMPLOYEES, OR 32 THEIR FAMILIES OR BENEFICIARIES, AFTER SERVICE TO THE LOCAL GOVERNMENT 33 HAS ENDED, INCLUDING, BUT NOT LIMITED TO, HEALTH CARE BENEFITS. THE TERM 34 "OTHER POST EMPLOYMENT BENEFITS" SHALL NOT INCLUDE CASH PAYMENTS FOR THE 35 MONETARY VALUE OF SICK LEAVE, VACATION OR OTHER SIMILAR ACCRUALS, 36 RETIREMENT INCENTIVE OR SEPARATION PAYMENTS, OR BENEFITS PROVIDED PURSU- 37 ANT TO THE CONSOLIDATED OMNIBUS BUDGET RECONCILIATION ACT OF 1985 38 (PUBLIC LAW 99-272), AS AMENDED. 39 2. THE GOVERNING BODY OF A LOCAL GOVERNMENT, BY RESOLUTION, MAY ESTAB- 40 LISH A TRUST IN THE CUSTODY OF THE CHIEF FISCAL OFFICER OF THE LOCAL 41 GOVERNMENT, FOR THE PURPOSE OF ACCUMULATING ASSETS TO FUND THE COST TO 42 THE LOCAL GOVERNMENT OF PROVIDING OTHER POST EMPLOYMENT BENEFITS. 43 CONTRIBUTIONS TO SUCH TRUST MAY BE MADE BY THE LOCAL GOVERNMENT BY BUDG- 44 ETARY APPROPRIATION OR TRANSFER IN ACCORDANCE WITH THE PROVISIONS OF 45 SUBDIVISION NINE OF SECTION SIX-P OF THIS ARTICLE. 46 3. THE GOVERNING BOARD OF THE LOCAL GOVERNMENT IS HEREBY DECLARED TO 47 BE THE TRUSTEE OF ANY TRUST ESTABLISHED PURSUANT TO THIS SECTION, 48 PROVIDED, HOWEVER, THAT THE GOVERNING BOARD, BY RESOLUTION, MAY DESIG- 49 NATE THE CHIEF FISCAL OFFICER OF THE LOCAL GOVERNMENT AS TRUSTEE, 50 SUBJECT TO ACCEPTANCE OF SUCH POSITION BY THE CHIEF FISCAL OFFICER AND, 51 IN THE CASE OF A CITY WITH A POPULATION OF ONE MILLION OR MORE, THE CITY 52 COMPTROLLER SHALL BE THE TRUSTEE. THE TRUSTEE SHALL BE RESPONSIBLE FOR 53 THE OPERATION AND MANAGEMENT OF THE TRUST, INCLUDING THE DEPOSIT AND 54 SECURING OF TRUST ASSETS IN THE SAME MANNER AS PROVIDED IN SECTION TEN 55 OF THIS ARTICLE, AND THE INVESTMENT OF TRUST ASSETS, AND SHALL BE 56 SUBJECT TO ALL THE DUTIES AND RESPONSIBILITIES IMPOSED BY LAW ON TRUS- A. 3636 6 1 TEES, EXCEPT TO THE EXTENT INCONSISTENT WITH THIS SECTION. THE TRUSTEE 2 SHALL EXECUTE AND FILE WITH THE CLERK OF THE LOCAL GOVERNMENT AN APPRO- 3 PRIATE UNDERTAKING, SEPARATE FROM AND IN ADDITION TO ANY OTHER UNDERTAK- 4 ING REQUIRED OF THE TRUSTEE IN ANY OTHER CAPACITY, IN AN AMOUNT SUFFI- 5 CIENT TO COVER TRUST ASSETS. IN LIEU THEREOF, SUCH COVERAGE MAY BE 6 INCLUDED IN A BLANKET UNDERTAKING IN ACCORDANCE WITH SECTION ELEVEN OF 7 THE PUBLIC OFFICERS LAW. THE COST OF THE UNDERTAKING SHALL BE CONSID- 8 ERED TO BE A REASONABLE EXPENSE OF ADMINISTERING THE TRUST. 9 4. CONTRIBUTIONS TO THE TRUST, AND ANY INTEREST OR OTHER INCOME OR 10 EARNINGS ON CONTRIBUTIONS, SHALL BE IRREVOCABLE BEFORE ALL LIABILITIES 11 OF THE LOCAL GOVERNMENT FOR OTHER POST EMPLOYMENT BENEFITS HAVE BEEN 12 SATISFIED, AND SHALL BE SOLELY DEDICATED TO, AND USED SOLELY FOR, 13 PROVIDING OTHER POST EMPLOYMENT BENEFITS AND PAYING APPROPRIATE AND 14 REASONABLE EXPENSES OF ADMINISTERING THE TRUST. NO ASSETS, INCOME, EARN- 15 INGS OR DISTRIBUTIONS OF THE TRUST SHALL BE SUBJECT TO ANY CLAIM OF 16 CREDITORS OF THE LOCAL GOVERNMENT OR OF ANY PERSON OR ENTITY ADMINISTER- 17 ING A PLAN FOR THE PROVISION OF OTHER POST EMPLOYMENT BENEFITS OR TO 18 ASSIGNMENT OR EXECUTION, ATTACHMENT OR ANY OTHER CLAIM ENFORCEMENT PROC- 19 ESS INITIATED BY OR ON BEHALF OF SUCH CREDITORS. EXCEPT AS OTHERWISE 20 PROVIDED IN SUBDIVISION SEVEN OF THIS SECTION, THE TRUSTEE SHALL NOT BE 21 RESPONSIBLE FOR THE ADEQUACY OF THE ASSETS OF THE TRUST TO MEET ANY 22 OTHER POST EMPLOYMENT BENEFIT. THE TRUSTEE SHALL NOT BE RESPONSIBLE FOR 23 TAKING ANY ACTION TO ENFORCE THE PAYMENT OF ANY APPROPRIATION INTO THE 24 TRUST. THE ASSETS OF THE TRUST, INCLUDING ALL INTEREST OR OTHER INCOME 25 OR EARNINGS ON CONTRIBUTIONS TO THE TRUST, SHALL BE EXEMPT FROM ALL 26 STATE AND LOCAL TAXES. THE TRUST MAY BE TERMINATED ONLY WHEN ALL 27 LIABILITIES OF THE LOCAL GOVERNMENT FOR OTHER POST EMPLOYMENT BENEFITS 28 HAVE BEEN SATISFIED AND THERE IS NO PRESENT OR FUTURE OBLIGATION, 29 CONTINGENT OR OTHERWISE, OF THE LOCAL GOVERNMENT TO PROVIDE SUCH OTHER 30 POST EMPLOYMENT BENEFITS. UPON SUCH TERMINATION, ANY REMAINING TRUST 31 ASSETS, AFTER ANY PROPER EXPENSES OF THE TRUST HAVE BEEN PAID, SHALL 32 REVERT TO THE LOCAL GOVERNMENT TO BE PAID INTO ONE OR MORE RESERVE 33 FUNDS, DULY ESTABLISHED PURSUANT TO THIS ARTICLE OR OTHER STATE STATUTE, 34 IN SUCH AMOUNTS AS DETERMINED BY THE GOVERNING BOARD OF THE LOCAL 35 GOVERNMENT. 36 5. DISBURSEMENTS FROM THE TRUST SHALL BE MADE ONLY UPON A DULY AUTHOR- 37 IZED REQUEST PURSUANT TO RESOLUTION OF THE GOVERNING BOARD OF THE LOCAL 38 GOVERNMENT STATING THE AMOUNT OF THE REQUESTED DISBURSEMENT AND DETER- 39 MINING THAT THE DISBURSEMENT IS FOR THE SOLE PURPOSE OF PROVIDING FUNDS 40 FOR THE COSTS OF OTHER POST EMPLOYMENT BENEFITS CURRENTLY DUE AND PAYA- 41 BLE BY THE LOCAL GOVERNMENT. 42 6. THE TRUSTEE SHALL INVEST THE ASSETS OF THE TRUST IN THE OTHER POST 43 EMPLOYMENT BENEFITS INVESTMENT FUND IN THE CUSTODY OF THE STATE COMP- 44 TROLLER, IN ACCORDANCE WITH SECTION NINETY-SEVEN-LLLL OF THE STATE 45 FINANCE LAW. ANY INTEREST OR OTHER INCOME OR EARNINGS RESULTING FROM THE 46 INVESTMENT OF ASSETS OF THE TRUST SHALL ACCRUE TO AND BECOME PART OF THE 47 ASSETS OF THE TRUST. THE TRUSTEE SHALL DEVELOP A WRITTEN INVESTMENT 48 POLICY FOR SELECTING AMONG THE INVESTMENT OPTIONS OFFERED BY THE STATE 49 COMPTROLLER PURSUANT TO SECTION NINETY-SEVEN-LLLL OF THE STATE FINANCE 50 LAW WHICH, AT A MINIMUM, SHALL INCLUDE A STATEMENT OF INVESTMENT OBJEC- 51 TIVES ADDRESSING, IN THE FOLLOWING ORDER OF PRIORITY, COMPLIANCE WITH 52 ALL LEGAL REQUIREMENTS, THE ABILITY TO TIMELY MEET DISBURSEMENT REQUESTS 53 WITHOUT FORCED SALE OF ASSETS, SAFETY OF PRINCIPAL AND ATTAINMENT OF 54 MARKET RATES OF RETURN. 55 7. NEITHER THE LOCAL GOVERNMENT NOR THE TRUSTEE SHALL BE LIABLE FOR 56 ANY LOSS OR EXPENSE SUFFERED BY THE TRUST IN THE ABSENCE OF BAD FAITH, A. 3636 7 1 WILLFUL MISCONDUCT OR INTENTIONAL WRONGDOING. THE TRUSTEE SHALL BE 2 CONSIDERED TO BE AN EMPLOYEE OF THE LOCAL GOVERNMENT FOR PURPOSES OF 3 SECTION EIGHTEEN OF THE PUBLIC OFFICERS LAW, PROVIDED, HOWEVER, THAT THE 4 COSTS OF ANY DEFENSE OR INDEMNIFICATION OF THE TRUSTEE ARISING FROM THE 5 EXERCISE OF THE FUNCTIONS OF TRUSTEE SHALL BE PAYABLE FROM THE ASSETS OF 6 THE TRUST. 7 8. THE TRUSTEE SHALL PREPARE OR CAUSE TO BE PREPARED AN ANNUAL FINAN- 8 CIAL REPORT OF ASSETS, LIABILITIES, REVENUES AND EXPENSES OF THE TRUST 9 IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES. THE TRUSTEE 10 SHALL CAUSE THE ACTIVITIES UNDERTAKEN IN CONNECTION WITH THE TRUST, 11 INCLUDING THE ANNUAL FINANCIAL REPORT, TO BE AUDITED ANNUALLY, EITHER 12 SEPARATELY OR AS PART OF THE OVERALL AUDIT OF THE REPORTING ENTITY, IN 13 ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS, BY AN INDEPENDENT 14 CERTIFIED PUBLIC ACCOUNTANT ENGAGED IN A MANNER CONSISTENT WITH THE 15 PROCUREMENT POLICIES AND PROCEDURES ADOPTED BY THE LOCAL GOVERNMENT 16 PURSUANT TO SECTION ONE HUNDRED FOUR-B OF THIS CHAPTER AND SHALL BE 17 SUBJECT TO A REQUEST FOR PROPOSALS PROCESS AT LEAST EVERY FIVE YEARS. 18 THE AUDIT SHALL BE COMPLETED WITHIN ONE HUNDRED TWENTY DAYS FROM THE 19 CLOSE OF THE FISCAL YEAR OF THE LOCAL GOVERNMENT. A COPY OF THE ANNUAL 20 FINANCIAL REPORT AND THE REPORT OF SUCH AUDIT SHALL BE PROVIDED TO THE 21 STATE COMPTROLLER, THE TRUSTEE AND THE GOVERNING BOARD OF THE LOCAL 22 GOVERNMENT AND SHALL BE PUBLICLY AVAILABLE AND POSTED ON THE WEBSITE OF 23 THE LOCAL GOVERNMENT, IF SUCH A WEBSITE IS MAINTAINED. 24 9. THE STATE COMPTROLLER MAY MAKE, AMEND AND REPEAL SUCH RULES AND 25 REGULATIONS AS THE STATE COMPTROLLER MAY DEEM APPROPRIATE FOR THE PROPER 26 OPERATION AND MANAGEMENT OF TRUSTS ESTABLISHED PURSUANT TO THIS SECTION. 27 10. NOTHING CONTAINED IN THIS SECTION SHALL BE INTERPRETED OR 28 CONSTRUED TO: 29 (A) CREATE ANY OBLIGATION IN, IMPOSE ANY OBLIGATION ON, OR ALTER ANY 30 OBLIGATION OF ANY LOCAL GOVERNMENT TO PROVIDE OTHER POST EMPLOYMENT 31 BENEFITS; 32 (B) LIMIT OR RESTRICT THE AUTHORITY OF A LOCAL GOVERNMENT TO MODIFY OR 33 ELIMINATE OTHER POST EMPLOYMENT BENEFITS; 34 (C) ASSURE OR DENY OTHER POST EMPLOYMENT BENEFITS; OR 35 (D) REQUIRE ANY LOCAL GOVERNMENT TO FUND ITS LIABILITY FOR OTHER POST 36 EMPLOYMENT BENEFITS. 37 S 4. Subdivision 9 of section 6-p of the general municipal law, as 38 added by chapter 518 of the laws of 1996, is amended to read as follows: 39 9. If, after the establishment of such fund, the municipality deter- 40 mines that such fund is no longer needed, the moneys remaining in such 41 fund may be transferred to any other reserve fund OR ANY OTHER POST 42 EMPLOYMENT BENEFITS TRUST of the municipal corporation authorized by 43 this chapter that is comprised of moneys which were raised on the same 44 tax base as the moneys in the reserve fund established under this 45 section or TO A RESERVE FUND ESTABLISHED PURSUANT TO section thirty-six 46 hundred fifty-one of the education law, only to the extent that the 47 moneys in this fund shall exceed the sum sufficient to pay all liabil- 48 ities incurred or accrued against it. Prior to the discontinuance of 49 such fund, the fiscal and legal officers of such municipal corporation 50 shall certify to the governing board thereof the amount that may be 51 necessary to retain in such fund to satisfy all liabilities incurred or 52 accrued against it and such sum shall be retained in the fund for 53 payment of such amounts or until later certified that such funds are no 54 longer needed. 55 S 5. The provisions of section 6-t of the general municipal law, as 56 added by section three of this act, shall not affect the validity of the A. 3636 8 1 establishment or implementation of the New York City Retiree Health 2 Benefit Trust, established June 12, 2006 by the City of New York as 3 Grantor, and neither the operation nor any amendment of such trust shall 4 be subject to the provisions of such section. The establishment of such 5 trust and its operation in accordance with its terms is hereby ratified 6 and approved. 7 S 6. This act shall take effect immediately.