Bill Text: NY S06835 | 2021-2022 | General Assembly | Amended
Bill Title: Increases the base benefit amount for computation of pension cost-of-living adjustments.
Spectrum: Slight Partisan Bill (Democrat 4-2)
Status: (Introduced - Dead) 2022-06-13 - PRINT NUMBER 6835C [S06835 Detail]
Download: New_York-2021-S06835-Amended.html
STATE OF NEW YORK ________________________________________________________________________ 6835--C 2021-2022 Regular Sessions IN SENATE May 19, 2021 ___________ Introduced by Sens. GOUNARDES, BRISPORT, KAMINSKY, MARTUCCI, PALUMBO, SKOUFIS -- 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 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 -- committee discharged, bill amended, ordered reprinted as amended and recommitted to said committee AN ACT to amend the retirement and social security law and the education law, in relation to increasing the base benefit amount for computation of pension 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. Subdivisions c and d of section 78-a of the retirement and 2 social security law, as added by chapter 125 of the laws of 2000, are 3 amended to read as follows: 4 c. Said cost-of-living adjustment shall be computed on a base benefit 5 amount not to exceed eighteen thousand dollars of the annual retirement 6 allowance defined in subdivision b of this section, except that effec- 7 tive on the first day of September, two thousand twenty-three, the cost- 8 of-living adjustment shall be computed on a base benefit amount not to 9 exceed twenty-one thousand dollars of the annual retirement allowance 10 defined in subdivision b of this section. 11 d. The percentage referred to in this section shall be determined 12 annually by reference to the consumer price index (all urban consumers, 13 CPI-U, U.S. city average, all items, 1982-84=100), published by the 14 United States bureau of labor statistics, for each applicable calendar 15 year. Said percentage shall equal fifty percent of the annual inflation, 16 as determined from the increase in the consumer price index in the one 17 year period ending on the March thirty-first prior to the cost-of-living EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD11429-08-2S. 6835--C 2 1 adjustment effective on the ensuing September first. Said percentage 2 shall then be rounded up to the next higher one-tenth of one percent and 3 shall not exceed three percent nor be less than one percent, except 4 that, commencing the first day of September, two thousand twenty-three, 5 the cost-of-living adjustments paid between the first day of September, 6 two thousand one and the first day of September, two thousand twenty-one 7 shall equal one hundred percent of the annual inflation, as determined 8 from the increase in the consumer price index in the one year period 9 ending on the March thirty-first prior to the cost-of-living adjustment 10 effective on the ensuing September first. Said percentage shall then be 11 rounded up to the next higher one-tenth of one percent and shall not 12 exceed three percent nor be less than one percent. 13 § 2. Subdivisions c and d of section 378-a of the retirement and 14 social security law, as added by chapter 125 of the laws of 2000, are 15 amended to read as follows: 16 c. Said cost-of-living adjustment shall be computed on a base benefit 17 amount not to exceed eighteen thousand dollars of the annual retirement 18 allowance defined in subdivision b of this section, except that, effec- 19 tive on the first day of September, two thousand twenty-three, the cost- 20 of-living adjustment shall be computed on a base benefit amount not to 21 exceed twenty-one thousand dollars of the annual retirement allowance 22 defined in subdivision b of this section. 23 d. The percentage referred to in this section shall be determined 24 annually by reference to the consumer price index (all urban consumers, 25 CPI-U, U.S. city average, all items, 1982-84=100), published by the 26 United States bureau of labor statistics, for each applicable calendar 27 year. Said percentage shall equal fifty percent of the annual inflation, 28 as determined from the increase in the consumer price index in the one 29 year period ending on the March thirty-first prior to the cost-of-living 30 adjustment effective on the ensuing September first. Said percentage 31 shall then be rounded up to the next higher one-tenth of one percent and 32 shall not exceed three percent nor be less than one percent, except 33 that, commencing the first day of September, two thousand twenty-three, 34 the cost-of-living adjustments paid between the first day of September, 35 two thousand one and the first day of September, two thousand twenty-one 36 shall equal one hundred percent of the annual inflation, as determined 37 from the increase in the consumer price index in the one year period 38 ending on the March thirty-first prior to the cost-of-living adjustment 39 effective on the ensuing September first. Said percentage shall then be 40 rounded up to the next higher one-tenth of one percent and shall not 41 exceed three percent nor be less than one percent. 42 § 3. Subdivisions c and d of section 532-a of the education law, as 43 added by chapter 125 of the laws of 2000, are amended to read as 44 follows: 45 c. Said cost-of-living adjustment shall be computed on a base benefit 46 amount not to exceed eighteen thousand dollars of the annual retirement 47 allowance defined in subdivision b of this section, except that effec- 48 tive on the first day of September, two thousand twenty-three, the cost- 49 of-living adjustment shall be computed on a base benefit amount not to 50 exceed twenty-one thousand dollars of the annual retirement allowance 51 defined in subdivision b of this section. 52 d. The percentage referred to in this section shall be determined 53 annually by reference to the consumer price index (all urban consumers, 54 CPI-U, U.S. city average, all items, 1982-84=100), published by the 55 United States bureau of labor statistics, for each applicable calendar 56 year. Said percentage shall equal fifty percent of the annual inflation,S. 6835--C 3 1 as determined from the increase in the consumer price index in the one 2 year period ending on the March thirty-first prior to the cost-of-living 3 adjustment effective on the ensuing September first. Said percentage 4 shall then be rounded up to the next higher one-tenth of one percent and 5 shall not exceed three percent nor be less than one percent, except 6 that, commencing the first day of September, two thousand twenty-three, 7 the cost-of-living adjustments paid between the first day of September, 8 two thousand one and the first day of September, two thousand twenty-one 9 shall equal one hundred percent of the annual inflation, as determined 10 from the increase in the consumer price index in the one year period 11 ending on the March thirty-first prior to the cost-of-living adjustment 12 effective on the ensuing September first. Said percentage shall then be 13 rounded up to the next higher one-tenth of one percent and shall not 14 exceed three percent nor be less than one percent. 15 § 4. Notwithstanding any other provision of law to the contrary, none 16 of the provisions of this act shall be subject to section 25 of the 17 retirement and social security law. 18 § 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 the New York State and Local Retirement System and the New York State Teachers' Retirement System. Starting with a payment in September 2023, the annual cost of living adjustment will be computed on a base benefit amount not to exceed $21,000. Addi- tionally, the COLA payments made from 2001 to 2021 will be recomputed as one hundred percent of the annual inflation, increased from the fifty percent of the annual inflation that was used in the calculation for the COLA payments over that period. Insofar as this bill affects the New York State and Local Employees' Retirement System (NYSLERS), the increased costs would be shared by the State of New York and the participating employers in the NYSLERS. If this bill were enacted during the 2022 legislative session, the increase in the present value of benefits would be approximately $2.26 billion. The estimated first year cost would be approximately $103 million to the State of New York and approximately $146 million to the participating employers in the NYSLERS. 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 participating employers in the NYSLPFRS. If this bill were enacted during the 2022 legislative session, the increase in the present value of benefits would be approximately $268 million. The estimated first year cost would be approximately $5.51 million to the State of New York and approximately $21.2 million to the participating employers in the NYSLPFRS. In addition to the costs discussed above, implementing the provisions of this legislation would generate administrative costs. Summary of relevant resources: Membership data as of March 31, 2021 was used in measuring the impact of the proposed change, the same data used in the April 1, 2021 actuari- al valuation. Distributions and other statistics can be found in the 2021 Report of the Actuary and the 2021 Comprehensive Annual Financial Report. The actuarial assumptions and methods used are described in the 2020 and 2021 Annual Report to the Comptroller on Actuarial Assumptions, and the Codes, Rules and Regulations of the State of New York: Audit and Control.S. 6835--C 4 The Market Assets and GASB Disclosures are found in the March 31, 2021 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 May 27, 2022, and intended for use only during the 2022 Legislative Session, is Fiscal Note No. 2022-155, prepared by the Actuary for the New York State and Local Retirement System.