Bill Text: NY A05231 | 2023-2024 | General Assembly | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

---

Bill Title: Relates to the calculation of past service credit for members in the title of deputy sheriff who provided police protection or correction officer service transferring between the New York state and local employees' retirement system to the New York state and local police and fire retirement system.

Spectrum: Slight Partisan Bill (Democrat 5-3)

Status: (Introduced) 2024-04-30 - print number 5231b [A05231 Detail]

Download: New_York-2023-A05231-Amended.html

---

                STATE OF NEW YORK
        ________________________________________________________________________

                                         5231--A

                               2023-2024 Regular Sessions

                   IN ASSEMBLY

                                      March 7, 2023
                                       ___________

        Introduced  by  M.  of  A.  PHEFFER AMATO,  LUNSFORD, WOERNER, McDONALD,
          DURSO, BRABENEC, SLATER, SANTABARBARA -- read once and referred to the
          Committee on Governmental Employees -- recommitted to the Committee on
          Governmental Employees in accordance with Assembly Rule 3, sec.  2  --
          committee  discharged,  bill amended, ordered reprinted as amended and
          recommitted to said committee

        AN ACT to amend the retirement and social security law, in  relation  to
          the  calculation  of  past  service credit for members in the title of
          deputy sheriff transferring between  the  New  York  state  and  local
          employees'  retirement  system  to the New York state and local police
          and fire retirement system

          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:

     1    Section  1.  Section  43  of the retirement and social security law is
     2  amended by adding a new subdivision m to read as follows:
     3    m. 1. Notwithstanding any other law, rule or regulation to the contra-
     4  ry, any member in the title of deputy sheriff transferring from the  New
     5  York  state and local employees' retirement system to the New York state
     6  and local police and fire retirement system after the effective date  of
     7  this  subdivision and any member previously in the title of deputy sher-
     8  iff having made such transfer shall be entitled to  a  determination  of
     9  the  amount of service credit that is eligible on a twenty year or twen-
    10  ty-five year retirement plan if, within one year of the date on which he
    11  or she first became a member of the New York state and local police  and
    12  fire  retirement system or within one year of the effective date of this
    13  subdivision, such member elects to do so.  If  the  member  subsequently
    14  transfers  back  to  the  New York state and local employees' retirement
    15  system, the full amount of service credit earned while in the  title  of
    16  deputy sheriff shall be transferred back to the New York state and local
    17  employees' retirement system.

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD07037-03-4
        A. 5231--A                          2

     1    2.  The  calculation of the amount of such service credit for a member
     2  will be determined by multiplying the eligible service credited  in  the
     3  New  York  state and local employees' retirement system plan by a salary
     4  multiplier, reflecting the rate of salary in  the  New  York  state  and
     5  local  employees'  retirement system plan relative to the rate of salary
     6  in the New York state and local police and fire retirement system  plan,
     7  and  a billing rate multiplier, reflecting the actuarial long-term aver-
     8  age billing rate in the New York state and local  employees'  retirement
     9  system  plan relative to the actuarial long-term average billing rate in
    10  the New York state and local police and fire retirement system plan. The
    11  determination of the salary multiplier and billing rate multiplier  will
    12  be  determined by the actuary of the New York state and local employees'
    13  retirement system and the New York  state  and  local  police  and  fire
    14  retirement  system. The amount of such service credited to the member in
    15  the New York state and local police  and  fire  retirement  system  plan
    16  shall not exceed the amount of service credited to the member in the New
    17  York state and local employees' retirement system plan.
    18    §  2. Section 343 of the retirement and social security law is amended
    19  by adding a new subdivision i to read as follows:
    20    i. 1. Notwithstanding any other law, rule or regulation to the contra-
    21  ry, any member in the title of deputy sheriff transferring from the  New
    22  York  state and local employees' retirement system to the New York state
    23  and local police and fire retirement system after the effective date  of
    24  this  subdivision and any member previously in the title of deputy sher-
    25  iff having made such transfer shall be entitled to  a  determination  of
    26  the  amount of service credit that is eligible on a twenty year or twen-
    27  ty-five year retirement plan if, within one year of the date on which he
    28  or she first became a member of the New York state and local police  and
    29  fire  retirement system or within one year of the effective date of this
    30  subdivision, such member elects to do so.  If  the  member  subsequently
    31  transfers  back  to  the  New York state and local employees' retirement
    32  system, the full amount of service credit earned while in the  title  of
    33  deputy  sheriff  shall  be  transferred back to New York state and local
    34  employees' retirement system.
    35    2. The calculation of the amount of such service credit for  a  member
    36  will  be  determined by multiplying the eligible service credited in the
    37  New York state and local employees' retirement system plan by  a  salary
    38  multiplier,  reflecting  the  rate  of  salary in the New York state and
    39  local employees' retirement system plan relative to the rate  of  salary
    40  in  the New York state and local police and fire retirement system plan,
    41  and a billing rate multiplier, reflecting the actuarial long-term  aver-
    42  age  billing  rate in the New York state and local employees' retirement
    43  system plan relative to the actuarial long-term average billing rate  in
    44  the New York state and local police and fire retirement system plan. The
    45  determination  of the salary multiplier and billing rate multiplier will
    46  be determined by the actuary of the New York state and local  employees'
    47  retirement  system  and  the  New  York  state and local police and fire
    48  retirement system. The amount of such service credited to the member  in
    49  the  New  York  state  and  local police and fire retirement system plan
    50  shall not exceed the amount of service credited to the member in the New
    51  York state and local employees' retirement system plan.
    52    3. If the member subsequently retires on an age based retirement  plan
    53  in  the  New  York  state  and  local  police and fire retirement system
    54  instead of a twenty year or twenty-five year plan, the  full  amount  of
    55  service  credit  earned  while  in  the title of deputy sheriff shall be
    56  granted.
        A. 5231--A                          3

     1    4. No member who receives service credit pursuant to this  subdivision
     2  shall  be  eligible  to  receive  additional  service credit pursuant to
     3  subdivision b of section three hundred eighty four-e of this article  if
     4  his or her employer has elected to provide such service credit.
     5    §  3. This act shall take effect on the sixtieth day after an internal
     6  revenue service ruling stating that the transfer and crediting of deputy
     7  sheriff service credit from the New  York  state  and  local  employees'
     8  retirement  system  into  the  New  York state and local police and fire
     9  retirement system special retirement plan by this act is  allowable  and
    10  does  not  jeopardize such retirement system's tax-qualified status, and
    11  shall remain in full force and effect only as long as such  transfer  is
    12  authorized  pursuant  to  the  provisions  of the internal revenue code;
    13  provided, that the state comptroller shall notify the  legislative  bill
    14  drafting  commission  upon  the  occurrence  of such ruling and upon any
    15  change in the provisions of the  internal  revenue  code  affecting  the
    16  provisions  of  this  act  in  order that the commission may maintain an
    17  accurate and timely effective data base of the official text of the laws
    18  of the state of New York in furtherance of effecting the  provisions  of
    19  section  44  of the legislative law and section 70-b of the public offi-
    20  cers law.
          FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
          This bill would expand the  definition  of  creditable  service  under
        twenty-year and twenty-five-year retirement plans (special plans) in the
        New York State and Local Police and Fire Retirement System (NYSLPFRS) to
        include service credit earned in the New York State and Local Employees'
        Retirement System (NYSLERS) for those individuals previously employed in
        the  title  of  Deputy  Sheriff.  To be eligible an individual must be a
        member of the NYSLPFRS and elect to transfer the NYSLERS service  credit
        to  the  NYSLPFRS special plan within twelve months of first joining the
        NYSLPFRS, or within twelve months of the effective date  of  this  bill,
        whichever is later. The amount of service credit granted in the NYSLPFRS
        special plan will be calculated by the Actuary of the New York State and
        Local  Retirement  System and will not exceed the service credited under
        the NYSLERS plan.
          Insofar as this bill affects the NYSLPFRS, if enacted during the  2024
        Legislative  Session,  it  is  estimated that the past service cost will
        average approximately 21 percent of an  affected  member's  compensation
        for each year of additional service credit that is granted.
          Internal  Revenue  Service  (IRS)  plan qualification issues: granting
        service credit towards retirement in a twenty-year plan in the  NYSLPFRS
        for  employment  that  was not rendered in the NYSLPFRS could jeopardize
        the governmental plan status of the Retirement System ("the System") and
        its exemption from the Employees Retirement Income Security Act (ERISA).
        This development could result in the loss  of  qualified  status,  which
        would  mean  the  loss  of tax benefits. This result would substantially
        impair the System's value to our more than one million participants.
          This legislation will not become effective until the System obtains  a
        favorable  ruling  from  the IRS stating that these provisions would not
        harm the qualification status of the System. Further, the provisions  of
        this  legislation  will  only  continue  in  full force and effect while
        authorized by the IRS. It is estimated that the costs to obtain  such  a
        ruling would be $38,000 for the services of the IRS, and $1,000 per hour
        for legal consultants.
          In addition to the costs to obtain a ruling from the IRS stated above,
        if  this bill is enacted, there will be an administrative cost to imple-
        ment the provisions of this legislation.
        A. 5231--A                          4

          All costs will be shared by the  State  of  New  York  and  the  local
        participating employers in the NYSLPFRS.
          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.
          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 February 15, 2024,  and  intended  for  use  only
        during  the  2024  Legislative  Session,  is  Fiscal  Note  No. 2024-32,
        prepared by the Actuary for the New  York  State  and  Local  Retirement
        System.