Bill Text: NY S05182 | 2023-2024 | General Assembly | Introduced

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

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Bill Title: Provides that a member of the New York state teachers' retirement system or the New York city teachers' retirement system, and certain members of the New York state and local employees' retirement system who are employed by teaching institutions, shall be entitled to obtain credit for up to 5 years of service rendered as a teacher employed by a private elementary or secondary school or by a private college in New York state.

Spectrum: Partisan Bill (Republican 3-0)

Status: (Introduced) 2024-04-24 - PRINT NUMBER 5182A [S05182 Detail]

Download: New_York-2023-S05182-Introduced.html

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                STATE OF NEW YORK
        ________________________________________________________________________

                                          5182

                               2023-2024 Regular Sessions

                    IN SENATE

                                    February 24, 2023
                                       ___________

        Introduced  by  Sens. GRIFFO, HELMING -- read twice and ordered printed,
          and when printed to be committed to the Committee on Civil Service and
          Pensions

        AN ACT to authorize members of the New York  state  and  New  York  city
          teachers'  retirement systems and the New York state and local employ-
          ees' retirement system to claim retirement credit for certain  private
          school teaching service

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

     1    Section 1. Notwithstanding any other provision of law, a member of the
     2  New York state teachers' retirement system or the New York  city  teach-
     3  ers'  retirement  system,  or any member of the New York state and local
     4  employees' retirement system who is employed by  a  school  district,  a
     5  board  of  cooperative  educational services, a vocational education and
     6  extension board, an institution for the  instruction  of  the  deaf  and
     7  blind  as  enumerated  in  section 4201 of the education law or a school
     8  district as enumerated in section 1 of chapter 566 of the laws of  1967,
     9  or  who is employed by the state of New York as an institutional teacher
    10  as defined by section 136 of the civil service law, shall be entitled to
    11  obtain credit for up to five years of  service  rendered  as  a  teacher
    12  employed by a private elementary or secondary school within the state of
    13  New  York  chartered by or registered with the board of regents, or in a
    14  private college within the state of New York authorized by the board  of
    15  regents  to  grant degrees, which would constitute service as a teacher,
    16  had it been performed within New York state for an employer  subject  to
    17  the applicable provisions of law governing such retirement system.
    18    § 2. The crediting of service pursuant to this act shall be in accord-
    19  ance  with such rules and regulations as shall be adopted by the retire-
    20  ment board of the  New  York  state  teachers'  retirement  system,  the
    21  retirement board of the New York city teachers' retirement system or the
    22  state  comptroller,  as  appropriate, provided that such rules and regu-

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD05522-02-3
        S. 5182                             2

     1  lations shall be substantially equivalent to the rules  and  regulations
     2  otherwise applicable for the crediting of service pursuant to applicable
     3  provisions  of  law  governing each such retirement system, and provided
     4  further  that  if such provisions have not expired such member makes the
     5  applicable payments required pursuant to the provisions of sections  517
     6  and  613, and paragraph 2 of subdivision b of section 609 of the retire-
     7  ment and social security law.
     8    § 3. The service credit granted pursuant to this act shall  constitute
     9  service  for  the  purpose  of  both  computing the pension payable upon
    10  retirement for service and in determining the total  length  of  service
    11  credited  for  the purpose of eligibility for a service retirement bene-
    12  fit, but shall not be used in computing final average  salary.  Provided
    13  further,  no  such credit shall be allowed for any service for which the
    14  person is receiving a benefit or will be entitled to receive  a  benefit
    15  at any future time from any other public or private retirement system or
    16  plan in this state, any other state or from the federal government.
    17    §  4. This act shall take effect June 30, 2023. Effective immediately,
    18  the addition, amendment and/or repeal of any rule or  regulation  neces-
    19  sary  for  the  implementation  of  this  act  on its effective date are
    20  authorized to be made and completed on or before such effective date.
          FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
          This bill would allow members of the New York State and Local  Employ-
        ees'  Retirement System (NYSLERS) who are currently employed by a school
        district, a board of  cooperative  educational  services,  a  vocational
        education  and extension board, an institution for the deaf and blind or
        as an institutional teacher to receive up to five years of service cred-
        it in the NYSLERS for employment as a teacher in private schools in  New
        York  State.  However,  credit  will not be provided for any service for
        which the member is receiving a benefit or will be entitled to receive a
        benefit at any future time from any other public or  private  retirement
        system  or  plan  in New York State, any other state or from the federal
        government.
          The additional service credit granted  pursuant  to  this  bill  shall
        constitute service credit for the purpose of computing the pension paya-
        ble  upon  retirement  and  shall be used to determine eligibility for a
        service benefit. For certain members, contributions will be required  to
        obtain such additional service credit. Each such member will be required
        to make a payment of 3% (6% for Tier 6) of current compensation per year
        of additional service credit granted pursuant to this bill.
          Insofar  as  this  bill affects the NYSLERS, pursuant to Section 25 of
        the Retirement and Social Security 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. If this  bill
        were  enacted  during the 2023 legislative session, it is estimated that
        the past service cost will average approximately 18% (15% for Tier 6) of
        an affected member's compensation for each year  of  additional  service
        credit that is purchased.
          The  exact  number  of  current  members as well as future members who
        could be affected by this legislation cannot be readily determined.
          Internal Revenue Service (IRS)  plan  qualification  issues:  granting
        service  credit  for  employment  rendered  to any organization that may
        potentially be considered a non-governmental or private  employer,  such
        as  certain  types  of  educational institutions described in this bill,
        could jeopardize the Retirement System's governmental  plan  status  and
        its  exemption  from ERISA. This development could result in the loss of
        qualified status, which would mean the loss of tax benefits. This result
        S. 5182                             3

        would substantially impair the Retirement System's  value  to  our  more
        than one million participants.
          Prior to the enactment of this legislation, we recommend that a favor-
        able ruling be obtained from the IRS stating that these provisions would
        not  harm the qualification status of the Retirement System. It is esti-
        mated 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.
          Summary of relevant resources:
          Membership  data as of March 31, 2022 was used in measuring the impact
        of the proposed change, the same data used in the April 1, 2022 actuari-
        al valuation. Distributions and other statistics can  be  found  in  the
        2022  Report  of the Actuary and the 2022 Annual Comprehensive Financial
        Report.
          The actuarial assumptions and methods used are described in the  2020,
        2021,  and  2022  Annual  Report to the Comptroller on Actuarial Assump-
        tions, 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, 2022
        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 17, 2023,  and  intended  for  use  only
        during  the  2023  Legislative  Session,  is  Fiscal  Note  No. 2023-71,
        prepared by the Actuary for the New  York  State  and  Local  Retirement
        System.