Bill Text: NY S05809 | 2023-2024 | General Assembly | Amended
Bill Title: Relates to providing cost-of-living adjustments; increases benefits from fifty to one hundred percent.
Spectrum: Moderate Partisan Bill (Democrat 4-1)
Status: (Introduced) 2024-02-09 - PRINT NUMBER 5809C [S05809 Detail]
Download: New_York-2023-S05809-Amended.html
STATE OF NEW YORK ________________________________________________________________________ 5809--C 2023-2024 Regular Sessions IN SENATE March 16, 2023 ___________ Introduced by Sens. GOUNARDES, ADDABBO, HARCKHAM, THOMAS, WEIK -- read twice and ordered printed, and when printed to be committed to the Committee on Civil Service and Pensions -- committee discharged, bill amended, ordered reprinted as amended and recommitted to said commit- tee -- committee discharged, bill amended, ordered reprinted as amended and recommitted to said committee -- recommitted to the Committee on Civil Service and Pensions in accordance with Senate Rule 6, sec. 8 -- committee discharged, bill amended, ordered reprinted as amended and recommitted to said committee AN ACT to amend the retirement and social security law, the education law and the administrative code of the city of New York, in relation to providing cost-of-living adjustments The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Subdivision g of section 78-a of the retirement and social 2 security law, as added by chapter 125 of the laws of 2000, is amended to 3 read as follows: 4 g. Notwithstanding any other provision of law, effective the first day 5 of September, two thousand twenty-five, the surviving spouse of a 6 deceased retired member who retired under an option which provides that 7 benefits are to be continued for life to the surviving spouse after the 8 death of the retired member, shall be entitled to receive benefits 9 pursuant to this section. Said benefits shall be [fifty] one hundred 10 percent of the monthly benefits which the pensioner would be receiving 11 pursuant to this section if living, and shall commence (i) with a 12 payment for the month of September, two thousand twenty-five, or (ii) 13 the month following the death of the deceased retired member, whichever 14 is later. 15 § 2. Subdivision g of section 378-a of the retirement and social secu- 16 rity law, as added by chapter 125 of the laws of 2000, is amended to 17 read as follows: EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD08560-12-4S. 5809--C 2 1 g. Notwithstanding any other provision of law, effective the first day 2 of September, two thousand twenty-five, the surviving spouse of a 3 deceased retired member who retired under an option which provides that 4 benefits are to be continued for life to the surviving spouse after the 5 death of the retired member, shall be entitled to receive benefits 6 pursuant to this section. Said benefits shall be [fifty] one hundred 7 percent of the monthly benefits which the pensioner would be receiving 8 pursuant to this section if living, and shall commence (i) with a 9 payment for the month of September, two thousand twenty-five, or (ii) 10 the month following the death of the deceased retired member, whichever 11 is later. 12 § 3. Subdivision g of section 532-a of the education law, as added by 13 chapter 125 of the laws of 2000, is amended to read as follows: 14 g. Notwithstanding any other provision of law, effective the first day 15 of September, two thousand twenty-five, the surviving spouse of a 16 deceased retired member who retired under an option which provides that 17 benefits are to be continued for life to the surviving spouse after the 18 death of the retired member, shall be entitled to receive benefits 19 pursuant to this section. Said benefits shall be [fifty] one hundred 20 percent of the monthly benefits which the pensioner would be receiving 21 pursuant to this section if living, and shall commence (i) with a 22 payment for the month of September, two thousand twenty-five, or (ii) 23 the month following the death of the deceased retired member, whichever 24 is later. 25 § 4. Subdivision g of section 13-696 of the administrative code of the 26 city of New York, as added by chapter 125 of the laws of 2000, is 27 amended to read as follows: 28 g. Notwithstanding any other provision of law, effective the first day 29 of September, two thousand twenty-five, the surviving spouse of a 30 deceased retired member of the New York city employees' retirement 31 system, the New York city teachers' retirement system, the New York city 32 police pension fund, the New York city fire department pension fund or 33 the New York city board of education retirement system who retired under 34 an option which provides that benefits are to be continued for life to 35 the surviving spouse after the death of the member, shall be entitled to 36 receive a benefit pursuant to this section. Said benefit shall be 37 [fifty] one hundred percent of the monthly benefit which the pensioner 38 would be receiving if living, and shall commence (i) with a payment for 39 the month of September, two thousand twenty-five, or (ii) the month 40 following the death of the deceased retired member, whichever is later. 41 § 5. This act shall take effect immediately. FISCAL NOTE.--Pursuant to Legislative Law, Section 50: This bill would provide an increase in the defined benefit cost-of- living adjustment (COLA) for New York public retirement systems. Start- ing with a payment in September 2025, the cost-of-living benefit payable to a surviving spouse who is eligible for COLA will be increased from fifty percent to one hundred percent of the benefit that the pensioner would have received. Insofar as this bill affects the New York State and Local Employees' Retirement System (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 suffi- cient to pay the cost of the provision. If this bill were enacted during the 2024 Legislative Session, the increase in the present value of bene- fits would be approximately $1.7 billion.S. 5809--C 3 In the NYSLERS, this benefit improvement will be funded by (1) billing a past service cost to cover retrospective benefit increases and (2) increasing the billing rates charged annually to cover prospective bene- fit increases, as follows: (1) To fund retrospective costs, the State of New York will be required to pay $1.82 billion (including interest) as of March 1, 2025. (2) To fund prospective costs, the annual contribution required of all participating employers in NYSLERS is 0.03% of billable salary, or approximately $4.4 million to the State of New York and approximately $6.6 million to the local participating employers. This permanent annu- al cost will vary in subsequent billing cycles with changes in the bill- ing rate and salary of the affected members. Insofar as this bill affects the New York State and Local Police and Fire Retirement System (NYSLPFRS), the increased costs would be shared by the State of New York and the local participating employers in the NYSLPFRS. If this bill were enacted during the 2024 Legislative Session, the increase in the present value of benefits would be approximately $180 million. NYSLPFRS Increase in present Increase in required value benefits contributions Tiers 1-5 $173 million $86 million Tier 6 $7 million $94 million Total $180 million $180 million In the NYSLPFRS, this benefit improvement will be funded by increasing the billing rates charged annually to cover both retrospective and prospective benefit increases. The annual contribution required of all participating employers in NYSLPFRS is 0.4% of billable salary, or approximately $3.4 million to the State of New York and approximately $14 million to the local participating employers. This permanent annual cost will vary in subsequent billing cycles with changes in the billing rate and salary of the affected members. 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 January 26, 2024, and intended for use only during the 2024 Legislative Session, is Fiscal Note No. 2024-45, prepared by the Actuary for the New York State and Local Retirement System. FISCAL NOTE.--Pursuant to Legislative Law, Section 50:S. 5809--C 4 As it relates to the New York State Teachers' Retirement System, this bill would amend subdivision g of Section 532-a of the Education Law to increase the cost-of-living adjustment (COLA) benefit to surviving spouse beneficiaries of deceased retirees who elected an option which provides a lifetime benefit to their surviving spouse. The COLA survivor benefit would be equal to 100% of the monthly benefit which the retiree would be receiving if alive. The current COLA survivor benefit is equal to 50% of the benefit the retiree would be receiving if alive. This increase in spousal survivor benefit would also be applicable to the "catch-up" supplementation provided under subdivision f to eligible retirees who retired before January 1, 1997. This benefit improvement would be effective in September of 2025. The annual cost to the employers of members of NYSTRS for this benefit is estimated to be $42.0 million or 0.22% of payroll if this bill is enacted. Member data is from the System's most recent actuarial valuation files as of June 30, 2023, consisting of data provided by the employers to the Retirement System. The most recent data distributions and statistics can be found in the System's Annual Report for fiscal year ended June 30, 2023. System assets are as reported in the System's financial statements and can also be found in the System's Annual Report. Actuarial assump- tions and methods are provided in the System's Actuarial Valuation Report as of June 30, 2023. The source of this estimate is Fiscal Note 2024-8 dated February 2, 2024 prepared by the Office of the Actuary of the New York State Teach- ers' Retirement System and is intended for use only during the 2024 Legislative Session. I, Richard A. Young, am the Chief Actuary for the New York State Teachers' Retirement System. I am a member of the Ameri- can Academy of Actuaries and I meet the Qualification Standards of the American Academy of Actuaries to render the actuarial opinion contained herein.
