S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  8220

                            I N  S E N A T E

                            December 19, 2016
                               ___________

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

AN ACT relating to granting Tier I status to  Cynthia  Falletta  in  the
  Teachers'  Retirement System of the City of New York with a membership
  date of June 1, 1972

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1. Notwithstanding any inconsistent provision of law, Cynthia
Falletta, a member of the Teachers' Retirement System of the City of New
York (TRSNYC) with Tier IV status, who was employed by the City  Univer-
sity of New York from June 1, 1972 until April 8, 1976 and from June 22,
1976  to  October  28,  1976, and was a member of the Board of Education
Retirement System from December 12, 1990  until  February  28,  1994  at
which  point  she  became a member of the Teachers' Retirement System of
the City of New York, and who for reasons  not  ascribable  to  her  own
negligence  was  retroactively enrolled as a Tier IV member, shall, upon
submission of an application filed with the Board of Trustees of  TRSNYC
on  or  before the thirty-first day of December next succeeding the date
on which this act shall have become a law, be reclassified as a  Tier  I
member with June 1, 1972 as her date of membership and shall be entitled
to every right, benefit and privilege which would have been available to
her  in accordance with Tier I status, and the City of New York shall be
responsible for all costs to provide  the  Tier  I  benefit  to  Cynthia
Falletta,  provided,  however that Cynthia Falletta shall be responsible
for contributing the required member contributions for  Tier  I  member-
ship.
  S 2. This act shall take effect immediately.
  FISCAL NOTE. -- Pursuant to Legislative Law, Section 50:
  PROVISIONS  OF  PROPOSED  LEGISLATION:  The proposed legislation would
permit Cynthia Falletta, a retired Tier 4 member of the  New  York  City
Teachers'  Retirement  System  (TRS), to elect, by filing an application
with the Board of Trustees of TRS within the end of the calendar year in
which the proposed legislation is passed, to be reclassified as a Tier 1

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD13729-05-6
              

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member and have her retirement allowance  recalculated  and  paid  under
Tier 1 (Plan A) benefit calculation provisions.
  The  Effective  Date  of the proposed legislation would be the Date of
Enactment.
  BACKGROUND - GENERAL: Ms. Falletta retired as a Tier 4 TRS  member  on
October  18, 2012. She currently receives an annual retirement allowance
of $48,243.
  If the proposed legislation is passed, Ms. Falletta would be reclassi-
fied as a Tier 1 retired member and her retirement  allowance  would  be
recalculated  as if she had joined a public retirement system within the
state upon her commencement of part-time employment as a college assist-
ant with the City University of New York in 1972. The additional cost to
fund the increased retirement allowance  associated  with  the  proposed
legislation would fall upon the City of New York.
  Because Tier 1 TRS members are generally permitted to take an actuari-
al  reduction  of  their retirement allowance to account for deficits in
member contributions, for purposes of this fiscal  note  it  is  assumed
that  Ms. Falletta would not pay any owed member contributions resulting
from the reclassification. Based on this assumption and  application  of
other  Tier  1  benefit calculation provisions, it is estimated that Ms.
Falletta's annual retirement allowance would increase to  $64,822.  This
annual  increase  would  apply prospectively as well as retroactively to
Ms. Falletta's October 18, 2012 date of retirement.
  FINANCIAL IMPACT - ACTUARIAL PRESENT VALUES: The  estimated  financial
impact  of  this  proposal  has  been calculated based on the difference
between the actuarial present value of  (1)  the  Tier  1  benefits  Ms.
Falletta would receive if this proposed legislation were enacted (retro-
active  to October 18, 2012 retirement date) and (2) the Tier 4 benefits
that are currently being paid to Ms. Falletta.
  Based on the actuarial assumptions and methods described  herein,  the
enactment  of  this  proposed  legislation  would increase the Actuarial
Present Value of Benefits (APVB)  and  the  Unfunded  Actuarial  Accrued
Liability (UAAL) of TRS by approximately $259,000 as of June 30, 2016.
  FINANCIAL  IMPACT  - ANNUAL EMPLOYER CONTRIBUTIONS: In accordance with
Section 13-638.2(k-2) of the Administrative Code  of  the  City  of  New
York,  the  amortization  schedule  for new UAAL attributable to benefit
changes is determined by the Actuary but is  generally  calculated  over
the remaining working lifetime of those impacted by the benefit changes.
  Since  Ms.  Falletta  is  retired and collecting a pension, the entire
increase in UAAL of $259,000 based on the  Actuary's  actuarial  assump-
tions  and methods in effect on June 30, 2015 would be recognized in the
first year.
  CONTRIBUTION TIMING: If  enacted  during  the  2016  Legislative,  the
retirement  allowance  payable  to  Ms.  Falletta  would likely first be
reflected in the June 30, 2017 census data. In accordance with the  One-
Year  Lag  methodology  used  to  determine  employer contributions, the
increase in employer contributions would first be reflected  for  Fiscal
Year 2019.
  OTHER  COSTS:  This  Fiscal Note does not measure administrative costs
associated with implementing this proposed legislation.
  ACTUARIAL ASSUMPTIONS AND METHODS: Additional APVB, UAAL and  employer
contributions  presented  herein  have  been  calculated  based  on  the
Actuary's actuarial assumptions and methods in effect for  the  Prelimi-
nary  June  30,  2015  (Lag)  actuarial  valuation used to determine the
Preliminary Fiscal Year 2017 employer contributions of TRS.

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  STATEMENT OF ACTUARIAL OPINION: I, Sherry S. Chan, am the Chief  Actu-
ary for, and independent of, the New York City Pension Funds and Retire-
ment Systems. I am a Fellow of the Society of Actuaries, a Fellow of the
Conference  of Consulting Actuaries and a Member of the American Academy
of Actuaries. I meet the Qualification Standards of the American Academy
of Actuaries to render the actuarial opinion contained herein.
  FISCAL  NOTE IDENTIFICATION: This Fiscal Note 2016-39 dated October 5,
2016, was prepared by the Chief Actuary for the New York City  Teachers'
Retirement  System.  This  estimate  is intended for use only during the
2016 Legislative Session.