Bill Text: NY A07449 | 2019-2020 | General Assembly | Amended


Bill Title: Establishes an age 55/25 temporary retirement incentive for certain public employees who are members of the teachers' retirement system.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Introduced) 2020-05-28 - print number 7449a [A07449 Detail]

Download: New_York-2019-A07449-Amended.html



                STATE OF NEW YORK
        ________________________________________________________________________

                                         7449--A

                               2019-2020 Regular Sessions

                   IN ASSEMBLY

                                       May 3, 2019
                                       ___________

        Introduced  by M. of A. RAMOS -- read once and referred to the Committee
          on Governmental Employees -- recommitted to the Committee  on  Govern-
          mental Employees in accordance with Assembly Rule 3, sec. 2 -- commit-
          tee  discharged, bill amended, ordered reprinted as amended and recom-
          mitted to said committee

        AN ACT to provide a temporary retirement incentive for  certain  members
          of the New York state teachers' retirement system

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

     1    Section 1. This act enacts into law  components  of  legislation  that
     2  would  establish an age 55/25 temporary retirement incentive for certain
     3  public employees.
     4    § 2. Legislative findings. The legislature finds and declares that the
     5  retirement benefit for certain public employees who are above age 55 and
     6  with 25 years of service provided for in this act is intended only to be
     7  temporary in nature for employees who are eligible to receive and quali-
     8  fy for the applicable benefit during the applicable time periods  speci-
     9  fied  in  this  act.  Further, nothing in this act shall be construed to
    10  create an expectation of a future or continuing retirement  benefit  for
    11  any  public  employee who is not eligible to receive and qualify for the
    12  retirement benefits herein during the applicable time periods.
    13    § 3. Definitions. As used in this  act,  unless  the  context  clearly
    14  requires otherwise:
    15    (a)  "Retirement system" means the New York state teachers' retirement
    16  system.
    17    (b) "Teachers' retirement system" means the New York  state  teachers'
    18  retirement system.
    19    (c)  "Educational  employer" means a participating employer which is a
    20  school district, a board of cooperative educational  services,  a  voca-
    21  tional education and extension board, an institution for the instruction
    22  of the deaf and of the blind as enumerated in section 4201 of the educa-

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD07621-06-0

        A. 7449--A                          2

     1  tion law, or a school district as enumerated in section 1 of chapter 566
     2  of the laws of 1967, as amended.
     3    (d)  "Eligible  employee" means a person who is a member of the teach-
     4  ers' retirement system, who is an employee of an  educational  employer,
     5  who holds a position represented by the recognized collective bargaining
     6  units affiliated with the New York state united teachers employee organ-
     7  ization  as  certified  by his or her employer, and who has attained the
     8  age of 55 and has at least 25 years of creditable service in the retire-
     9  ment system.  For the purposes of this act, the term "eligible employee"
    10  shall be deemed to include building level administrators, including, but
    11  not limited to, principals and assistant principals.
    12    (e) "Active service" means service while being paid  on  the  payroll,
    13  provided  that  (i)  a  leave of absence with pay shall be deemed active
    14  service; (ii) other approved leave without  pay  not  to  exceed  twelve
    15  weeks  from  March  1,  2020 and the commencement of the designated open
    16  period; and (iii) the period of time subsequent to the June 2020  school
    17  term  and  on or before August 31, 2020 for a teacher (or other employee
    18  as defined in this act, employed on a school-year basis) who  is  other-
    19  wise in active service on the effective date of this act shall be deemed
    20  active service.
    21    (f)  "Open  period"  means  the period beginning with the commencement
    22  date as defined in subdivision (g) of this section and shall be 60  days
    23  in  length.  For  educational employers who make election after June 30,
    24  2020, the open period shall begin immediately after such  election,  and
    25  shall  not extend beyond August 31, 2020. For the purposes of retirement
    26  pursuant to this act, a service retirement  application  must  be  filed
    27  with  the  appropriate  retirement system not less than 14 days prior to
    28  the effective date of retirement to become effective, unless  a  shorter
    29  time period is permitted under law.
    30    (g)  "Commencement  date"  means  the first day the retirement benefit
    31  mandated by this act shall be made available, which shall mean a date or
    32  dates on or after the effective date of this act to be determined by the
    33  educational employer which elects to  participate  pursuant  to  section
    34  four of this act, but no sooner than June 30, 2020.
    35    §  4.  On  or after June 30, 2020 an educational employer may elect to
    36  provide its employees the retirement incentive authorized by this act by
    37  the adoption of a resolution of its  governing  body.  A  copy  of  such
    38  resolution  shall  be  filed with the appropriate retirement system. The
    39  resolution shall be accompanied by the affidavit  of  the  school  board
    40  president or trustee or other comparable official certifying the validi-
    41  ty of such resolution.
    42    § 5. Notwithstanding any other provision of law, any eligible employee
    43  serving in an eligible title who (a) has been continuously in the active
    44  service of an educational employer who has elected to participate in the
    45  retirement  incentive  provided  in section six of this act, pursuant to
    46  section four of this act, from March 1, 2020  to  the  date  immediately
    47  prior  to the commencement date of the applicable open period, (b) files
    48  an application for service retirement that is effective during the  open
    49  period, and (c) is otherwise eligible for a service retirement as of the
    50  effective  date  of  the application for retirement shall be entitled to
    51  the retirement benefit provided in section six of this act.
    52    § 6. Notwithstanding any other provision of law, any eligible employee
    53  who is: (a) a member of the teachers' retirement system, and  (b)  enti-
    54  tled  to  retirement  benefits  pursuant to section five of this act may
    55  retire during the open period  without  the  reduction  of  his  or  her
    56  retirement  benefit  that would otherwise be imposed by article 11 or 15

        A. 7449--A                          3

     1  of the retirement and social security law if he or she has attained  the
     2  age  of  55  and  has  completed at least 25 or more years of creditable
     3  service. An eligible employee who is covered by the provisions of  arti-
     4  cle  11  or  15  of  the retirement and social security law shall retire
     5  under the provisions of article 11 or 15 of the  retirement  and  social
     6  security law.
     7    §  7.  The  pension  benefit costs of section six of this act shall be
     8  paid by employers as provided  by  applicable  law  for  the  retirement
     9  system  covered  by  this  act  over  a  period not to exceed five years
    10  commencing in the state fiscal year ending March 31, 2022.
    11    § 8. Notwithstanding any other provision of law, this act  shall  have
    12  no  impact  on  retirement incentives, options or inducements offered as
    13  part of a contractual agreement between  an  eligible  employee  and  an
    14  educational  employer  which were negotiated prior to the effective date
    15  of this act.
    16    § 9. Severability clause.  If any clause, sentence, paragraph,  subdi-
    17  vision,  section  or  part of this act shall be adjudged by any court of
    18  competent jurisdiction to be invalid, such judgment  shall  not  affect,
    19  impair,  or  invalidate  the remainder thereof, but shall be confined in
    20  its operation to the clause, sentence, paragraph,  subdivision,  section
    21  or part thereof directly involved in the controversy in which such judg-
    22  ment shall have been rendered. It is hereby declared to be the intent of
    23  the  legislature  that  this  act  would  have been enacted even if such
    24  invalid provisions had not been included herein.
    25    § 10. This act shall take effect immediately.
        FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
          This bill would provide a temporary retirement incentive to members of
        the New York State Teachers' Retirement System during fiscal year  2020-
        2021.  This incentive would permit eligible members to retire without an
        early  retirement  reduction  upon attainment of at least age 55 with 25
        years of service.  Currently 30 years of service are required  in  order
        to  retire  without reduction for Tiers 2, 3, 4 and 5 members. Currently
        Tier 6 members are required to attain age 63 in order to retire  without
        reduction  regardless  of  the number of years of service they have.  In
        order to receive this benefit, a member of an employer who  has  elected
        to  participate  must  retire  during the designated 60-day open period,
        beginning on or after June 30, 2020 and not  extend  beyond  August  31,
        2020. In order to be eligible, a member must be an employee of an educa-
        tional employer and hold a position represented by one of the recognized
        collective  bargaining  units  affiliated with the New York State United
        Teachers (NYSUT) as certified by  his  or  her  employer.  In  order  to
        participate  in this retirement incentive, the educational employer must
        be a school district, a board of  cooperative  educational  services,  a
        vocational  education  and  extension  board,  an  institution  for  the
        instruction of the deaf and of the blind as enumerated in  Section  4201
        of  the Education Law or a school district as enumerated in Section 1 of
        Chapter 566 of the Laws of 1967.   Employers who  elect  to  participate
        would  pay  the  cost  of  the retirement incentive over a period not to
        exceed five years, beginning in the state fiscal year ending  March  31,
        2022.
          The  estimated  increase  in the present value of benefits due to this
        temporary retirement incentive is approximately $220 million. The annual
        cost, over a five-year period, to the participating employers of members
        of the New York State Teachers' Retirement System for  this  benefit  is
        estimated  to  be  $58.8  million  or  .34%  of  payroll if this bill is
        enacted.

        A. 7449--A                          4

          Member data is from  the  System's  most  recent  actuarial  valuation
        files,  consisting  of  data provided by the employers to the Retirement
        System.  Data distributions and statistics can be found in the  System's
        Comprehensive  Annual  Financial  Report  (CAFR).  System  assets are as
        reported  in the System's financial statements, and can also be found in
        the CAFR. Actuarial assumptions and methods are provided in the System's
        Actuarial Valuation Report.
          The source of this estimate is Fiscal Note 2020-25 dated May 19,  2020
        prepared  by  the  Actuary  of  the  New York State Teachers' Retirement
        System and is intended for use only during the 2020 Legislative Session.
        I, Richard A. Young, am the 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  Actu-
        aries to render the actuarial opinion contained herein.
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