Bill Text: NY S02679 | 2023-2024 | General Assembly | Introduced

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

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Bill Title: Authorizes and empowers the College Retirement Equities Fund (CREF) to merge with the Teachers Insurance and Annuity Association (TIAA) with CREF ceasing to be a corporate entity and TIAA as the surviving entity.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Passed) 2023-06-30 - SIGNED CHAP.171 [S02679 Detail]

Download: New_York-2023-S02679-Introduced.html

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                STATE OF NEW YORK
        ________________________________________________________________________

                                          2679

                               2023-2024 Regular Sessions

                    IN SENATE

                                    January 24, 2023
                                       ___________

        Introduced  by  Sen. BRESLIN -- read twice and ordered printed, and when
          printed to be committed to the Committee on Insurance

        AN ACT in relation to authorizing and empowering CREF  to  combine  with
          TIAA,  with  TIAA  continuing  in  existence  as  the surviving entity
          following such combination and with CREF ceasing  to  be  a  corporate
          entity;  and  to  repeal  chapter 124 of the laws of 1952, relating to
          incorporating the college retirement equities fund for the benefit  of
          the teaching profession

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

     1    Section 1. Chapter 124 of the laws of 1952, relating to  incorporating
     2  the  college  retirement  equities  fund for the benefit of the teaching
     3  profession, is REPEALED.
     4    § 2. Definitions. For purposes of this act the following  terms  shall
     5  have the following meanings:
     6    (a)  "CREF"  shall  mean  the College Retirement Equities Fund, formed
     7  pursuant to chapter 124 of the laws of 1952 as a companion  organization
     8  to TIAA for the issuance of variable annuity contracts;
     9    (b) "CREF Board of Governors" shall mean the individuals designated as
    10  governors  of CREF, pursuant to chapter 124 of the laws of 1952, who are
    11  the sole members of CREF;
    12    (c) "Plan of Combination" shall mean the agreement and plan of  combi-
    13  nation  of  TIAA  and  CREF  adopted and approved in accordance with the
    14  provisions of this act;
    15    (d) "Superintendent" shall mean the superintendent  of  the  New  York
    16  state department of financial services;
    17    (e)  "TIAA"  shall mean the Teachers Insurance and Annuity Association
    18  of America, an insurance company formed pursuant  to  the  laws  of  New
    19  York;

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD07358-01-3
        S. 2679                             2

     1    (f) "TIAA Board of Governors" shall mean the corporation formed pursu-
     2  ant  to  chapter 880 of the laws of 1937, which is the sole owner of the
     3  issued and outstanding stock of TIAA; and
     4    (g)  "TIAA  Separate  Account" shall mean the separate account of TIAA
     5  created in connection with the Plan of Combination.
     6    § 3. (a) Subject to the provisions of this act and the terms set forth
     7  in the Plan of Combination, CREF is hereby authorized and  empowered  to
     8  combine  with  TIAA,  with TIAA continuing in existence as the surviving
     9  entity following such combination and with CREF ceasing to be  a  corpo-
    10  rate  entity. TIAA shall continue to be an insurance company established
    11  pursuant to the laws of the state of New York. The TIAA Separate Account
    12  shall be subject to the insurance laws of the state  of  New  York,  and
    13  neither the combination nor any transactions contemplated by the Plan of
    14  Combination  shall  subject  TIAA,  as the surviving entity, or the TIAA
    15  Separate Account, to the not-for-profit corporation law. The TIAA  Board
    16  of Governors shall remain subject to the not-for-profit corporation law.
    17    (b)  Such  combination  shall be deemed a merger under the laws of the
    18  state of New York, including any laws applicable to insurance  companies
    19  or  not-for-profit  corporations, and shall be approved by not less than
    20  two-thirds of the individual governors of the CREF Board of Governors as
    21  the sole members of CREF, and not less than two-thirds of the individual
    22  members of the TIAA Board of Governors as the sole shareholder of  TIAA.
    23  Thereafter,  the  Plan  of  Combination shall be submitted to the Super-
    24  intendent for approval.  Following the receipt of all  necessary  corpo-
    25  rate  and  regulatory approvals, including authorization by the TIAA and
    26  CREF Boards of Governors and TIAA and CREF boards of trustees, a  certi-
    27  fied  copy  of  the  Plan of Combination with the approval of the Super-
    28  intendent endorsed thereon shall be filed in the office of the clerk  of
    29  New  York  County,  and  upon  such  filing the combination shall become
    30  effective.
    31    § 4. (a) At the effective time of and pursuant to the Plan of Combina-
    32  tion, all assets and liabilities of CREF including causes of action  and
    33  defenses  thereto, shall vest by operation of law in TIAA, and all vari-
    34  able annuity contracts and certificates issued by CREF and in  force  at
    35  the effective time of the combination, shall be and become TIAA variable
    36  annuity  contracts  and  certificates  as  of  the effective time of the
    37  combination; provided, however, that at the effective time of the combi-
    38  nation (i) without further act or deed, the assets  and  liabilities  of
    39  CREF  relating to the outstanding variable annuity contracts and certif-
    40  icates of CREF shall immediately be assets and liabilities of and  allo-
    41  cated  to the TIAA Separate Account without such assets becoming general
    42  account assets of TIAA; and (ii) each investment account of  CREF  imme-
    43  diately  prior  to  the combination shall comprise an investment sub-ac-
    44  count of the TIAA Separate Account, with the assets and  liabilities  of
    45  each  such  investment  account vesting immediately and directly in that
    46  investment sub-account.
    47    (b) At the effective time, TIAA shall assume the  obligations  of  the
    48  CREF  contracts  and certificates, and all holders of CREF contracts and
    49  certificates shall be notified of the combination.
    50    (c) At all times, the assets of the TIAA Separate Account, and of each
    51  investment sub-account, shall be  segregated  from  the  assets  of  the
    52  general  account of TIAA and any other TIAA separate account and invest-
    53  ment sub-account. That portion  of  the  assets  of  the  TIAA  Separate
    54  Account,  and of each investment sub-account, not exceeding the reserves
    55  and other contract liabilities with respect to the TIAA Separate Account
    56  and each investment sub-account, shall not be  chargeable  with  liabil-
        S. 2679                             3

     1  ities  arising  out of any other business of TIAA. The income, gains and
     2  losses, whether or not realized, from assets allocated to the TIAA Sepa-
     3  rate Account, and each investment sub-account, shall be credited  to  or
     4  charged  against  the  TIAA Separate Account and each investment sub-ac-
     5  count without regard to other income, gains or losses of TIAA.
     6    § 5. This act shall take effect immediately, provided,  however,  that
     7  section  one  of this act shall take effect at the effective time of the
     8  combination of TIAA and CREF pursuant to this act, and provided further,
     9  that the Superintendent of the New York state  department  of  financial
    10  services  shall notify the legislative bill drafting commission upon the
    11  occurrence of such effective time in order that the commission may main-
    12  tain an accurate and timely database of the official text of the laws of
    13  the State of New York in furtherance of effectuating the  provisions  of
    14  section  44  of the legislative law and section 70-b of the public offi-
    15  cers law.