STATE OF NEW YORK
________________________________________________________________________
6481--A
2023-2024 Regular Sessions
IN SENATE
April 24, 2023
___________
Introduced by Sens. SKOUFIS, ADDABBO, CHU, WEBER -- read twice and
ordered printed, and when printed to be committed to the Committee on
Civil Service and Pensions -- 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, in relation to
service retirement benefits for members of the New York city police
pension fund
The People of the State of New York, represented in Senate and Assem-
bly, do enact as follows:
1 Section 1. Section 505 of the retirement and social security law, as
2 amended by chapter 18 of the laws of 2012, is amended to read as
3 follows:
4 § 505. Service retirement benefits; police/fire members, New York city
5 uniformed correction/sanitation revised plan members and investigator
6 revised plan members. a. The normal service retirement benefit for
7 police/fire members, New York city uniformed correction/sanitation
8 revised plan members and investigator revised plan members at normal
9 retirement age shall be a pension equal to fifty percent of final aver-
10 age salary, less fifty percent of the primary social security retirement
11 benefit commencing at age sixty-two, as provided in section five hundred
12 eleven of this article, except that for members of the New York city
13 police pension fund, the normal service retirement benefit shall not be
14 reduced by the primary social security retirement benefit commencing at
15 age sixty-two as provided in section five hundred eleven of this
16 article.
17 b. The early service retirement benefit for police/fire members, New
18 York city uniformed correction/sanitation revised plan members and
19 investigator revised plan members shall be a pension equal to two and
20 one-tenths percent of final average salary times years of credited
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD08526-04-4
S. 6481--A 2
1 service at the completion of twenty years of service or upon attainment
2 of age sixty-two, increased by one-third of one percent of final average
3 salary for each month of service in excess of twenty years, but not in
4 excess of fifty percent of final average salary, less fifty percent of
5 the primary social security retirement benefit commencing at age sixty-
6 two as provided in section five hundred eleven of this article,
7 provided, however, that New York city police/fire revised plan members,
8 New York city uniformed correction/sanitation revised plan members and
9 investigator revised plan members shall not be eligible to retire for
10 service prior to the attainment of twenty years of credited service, and
11 provided further that for members of the New York city police pension
12 fund, the early service retirement benefit shall not be reduced by the
13 primary social security retirement benefit commencing at age sixty-two
14 as provided in section five hundred eleven of this article.
15 c. A police/fire member, a New York city uniformed
16 correction/sanitation revised plan member or an investigator revised
17 plan member who retires with twenty-two years of credited service or
18 less may become eligible for annual escalation of the service retirement
19 benefit if he elects to have the payment of his benefit commence on the
20 date he would have completed twenty-two years and one month or more of
21 service. In such event, the service retirement benefit shall equal two
22 percent of final average salary for each year of credited service, less
23 fifty percent of the primary social security retirement benefit commenc-
24 ing at age sixty-two as provided in section five hundred eleven of this
25 article, except that for members of the New York city police pension
26 fund, the service retirement benefit shall not be reduced by the primary
27 social security retirement benefit commencing at age sixty-two as
28 provided in section five hundred eleven of this article.
29 § 2. Section 511 of the retirement and social security law is amended
30 by adding a new subdivision h to read as follows:
31 h. This section shall not apply to members of the New York city police
32 pension fund who receive a service retirement benefit pursuant to
33 section five hundred five of this article or a deferred vested benefit
34 pursuant to section five hundred sixteen of this article.
35 § 3. Subdivision c of section 516 of the retirement and social securi-
36 ty law, as amended by chapter 18 of the laws of 2012, is amended to read
37 as follows:
38 c. The deferred vested benefit of police/fire members, New York city
39 police/fire revised plan members, New York city uniformed
40 correction/sanitation revised plan members or investigator revised plan
41 members shall be a pension commencing at early retirement age equal to
42 two and one-tenths percent of final average salary times years of cred-
43 ited service, less fifty percent of the primary social security retire-
44 ment benefit commencing at age sixty-two, as provided in section five
45 hundred eleven of this article, except that for members of the New York
46 city police pension fund, the service retirement benefit shall not be
47 reduced by the primary social security retirement benefit commencing at
48 age sixty-two as provided in section five hundred eleven of this
49 article. A police/fire member, a New York city police/fire revised plan
50 member, a New York city uniformed correction/sanitation revised plan
51 member or investigator revised plan member may elect to receive his
52 vested benefit commencing at early retirement age or age fifty-five. If
53 the vested benefit commences before early retirement age, the benefit
54 shall be reduced by one-fifteenth for each year, if any, that the
55 member's early retirement age is in excess of age sixty, and by one-
56 thirtieth for each additional year by which the vested benefit commences
S. 6481--A 3
1 prior to early retirement age. If such vested benefit is deferred until
2 after such member's normal retirement age, the benefit shall be computed
3 and subject to annual escalation in the same manner as provided for an
4 early retirement benefit pursuant to subdivision c of section five
5 hundred five of this article.
6 § 4. This act shall take effect on the sixtieth day after it shall
7 have become a law.
FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
SUMMARY: This proposed legislation would amend Sections of the Retire-
ment and Social Security Law (RSSL) to eliminate the offset equal to 50%
of the primary social security benefit in the service, early service,
and vested retirement benefits for Tier 3 members of the New York City
Police Pension Fund (POLICE).
EXPECTED INCREASE (DECREASE) IN EMPLOYER CONTRIBUTIONS
by Fiscal Year for the first 25 years ($ in Millions)
Year POLICE
2025 62.1
2026 66.6
2027 72.4
2028 78.7
2029 84.9
2030 91.5
2031 97.7
2032 103.0
2033 108.2
2034 113.2
2035 118.0
2036 122.8
2037 127.5
2038 132.4
2039 137.2
2040 142.1
2041 122.3
2042 127.3
2043 132.6
2044 138.1
2045 143.5
2046 149.0
2047 154.6
2048 160.6
2049 166.8
Employer Contribution impact beyond Fiscal Year 2049 is not shown.
Projected contributions include future new hires that may be impacted.
The entire increase in employer contributions will be allocated to New
York City.
EXPECTED INCREASE (DECREASE) IN ACTUARIAL LIABILITIES
as of June 30, 2023 ($ in Millions)
Present Value (PV) POLICE
PV of Benefits: 788.6
PV of Employee Contributions: 0.0
PV of Employer Contributions: 788.6
Unfunded Accrued Liabilities: 226.2
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AMORTIZATION OF UNFUNDED ACCRUED LIABILITY
POLICE
Number of Payments: 16
Fiscal Year of Last Payment: 2040
Amortization Payment: 24.8 M
Unfunded Accrued Liability increases were amortized over the expected
remaining working lifetime of those impacted by the benefit changes
using level dollar payments.
CENSUS DATA: The estimates presented herein are based on preliminary
census data collected as of June 30, 2023. The census data for the
impacted population is summarized below.
POLICE
Active Members
- Number Count: 20,176
- Average Age: 32.8
- Average Service: 6.1
- Average Salary: 107,600
Term. Vested Members
- Number Count: 924
- Average Age: 34.7
IMPACT ON MEMBER BENEFITS: Currently, Tier 3 normal service retire-
ment, early service retirement, and vested retirement benefits are
subject to an offset equal to 50% of the primary social security benefit
as defined in RSSL Section 511 beginning at age 62.
Under the proposed legislation, the offset for such benefits would be
eliminated for POLICE members, resulting in an increase in benefits.
ASSUMPTIONS AND METHODS: The estimates presented herein have been
calculated based on the Revised 2021 Actuarial Assumptions and Methods
of the impacted retirement systems. In addition:
* New entrants were assumed to replace exiting members so that total
payroll increases by 3% each year for impacted groups. New entrant demo-
graphics were developed based on data for recent new hires and actuarial
judgement.
RISK AND UNCERTAINTY: The costs presented in this Fiscal Note depend
highly on the actuarial assumptions, methods, and models used, demo-
graphics of the impacted population and other factors such as invest-
ment, contribution, and other risks. If actual experience deviates from
actuarial assumptions, the actual costs could differ from those
presented herein. Quantifying these risks is beyond the scope of this
Fiscal Note.
This Fiscal Note is intended to measure pension-related impacts and
does not include other potential costs (e.g., administrative and Other
Postemployment Benefits).
This Fiscal Note does not include cost analyses relating to provisions
contained in RSSL Section 500(c).
STATEMENT OF ACTUARIAL OPINION: Marek Tyszkiewicz and Gregory Zelikov-
sky are members of the Society of Actuaries and the American Academy of
Actuaries. We are members of NYCERS but do not believe it impairs our
objectivity and we meet the Qualification Standards of the American
Academy of Actuaries to render the actuarial opinion contained herein.
To the best of our knowledge, the results contained herein have been
prepared in accordance with generally accepted actuarial principles and
S. 6481--A 5
procedures and with the Actuarial Standards of Practice issued by the
Actuarial Standards Board.
FISCAL NOTE IDENTIFICATION: This Fiscal Note 2024-04 dated January 22,
2024 was prepared by the Chief Actuary for the New York City Retirement
Systems and Pension Funds. This estimate is intended for use only during
the 2024 Legislative Session.