S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   7117
 
                        2019-2020 Regular Sessions
 
                           I N  A S S E M B L Y
 
                               April 9, 2019
                                ___________
 
 Introduced  by  M.  of  A.  ABBATE  -- (at request of the New York State
   Teachers' Retirement System) -- read once and referred to the  Commit-
   tee on Governmental Employees
 
 AN  ACT  to amend the retirement and social security law, in relation to
   the maximum amount certain members of the  New  York  state  teachers'
   retirement  system  may borrow against retirement contributions and to
   making technical corrections thereto
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Subdivision a of section 517-b of the retirement and social
 security law, as added by chapter 919 of the laws of 1990, is amended to
 read as follows:
   a.  1. A member of a teachers' retirement system in active service who
 has credit for at least one year of member service may borrow,  no  more
 than  once  during  each  twelve-month  period,  an amount not exceeding
 seventy-five percent of the total contributions made pursuant to section
 five hundred seventeen of this article (including interest  credited  at
 the  rate  set  forth in subdivision c of section five hundred seventeen
 compounded annually) and not less than one thousand dollars.
   2. A MEMBER OF THE NEW YORK  STATE  TEACHERS'  RETIREMENT  SYSTEM  WHO
 FIRST  JOINS  SUCH SYSTEM ON OR AFTER JULY FIRST, TWO THOUSAND TWENTY IN
 ACTIVE SERVICE AND WHO HAS CREDIT  FOR  AT  LEAST  ONE  YEAR  OF  MEMBER
 SERVICE  MAY  BORROW, NO MORE THAN ONCE DURING EACH TWELVE-MONTH PERIOD,
 AN AMOUNT, NOT LESS THAN ONE THOUSAND DOLLARS AND WHICH WOULD NOT  CAUSE
 THE  BALANCE  OWED  PURSUANT  TO  THIS  SECTION,  INCLUDING  ANY AMOUNTS
 BORROWED THEN OUTSTANDING TO EXCEED (I) FIFTY PERCENT  OF  THE  MEMBER'S
 TOTAL  CONTRIBUTIONS  MADE PURSUANT TO SECTION FIVE HUNDRED SEVENTEEN OF
 THIS ARTICLE (INCLUDING INTEREST CREDITED  AT  THE  RATE  SET  FORTH  IN
 SUBDIVISION  C OF THIS SECTION COMPOUNDED ANNUALLY); OR (II) FIFTY THOU-
 SAND DOLLARS, WHICHEVER IS LESS.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD09733-01-9
              

 A. 7117                             2
 
   § 2. Subdivision a of section 613-a of the retirement and social secu-
 rity law, as added by chapter 919 of the laws of  1990,  is  amended  to
 read as follows:
   a.  1. A member of a teachers' retirement system in active service who
 has credit for at least one year of member service may borrow,  no  more
 than  once  during  each  twelve-month  period,  an amount not exceeding
 seventy-five percent of the total contributions made pursuant to section
 six hundred thirteen of this article (including interest credited at the
 rate set  forth  in  subdivision  c  of  section  six  hundred  thirteen
 compounded annually) and not less than one thousand dollars.
   2.  A  MEMBER  OF  THE  NEW YORK STATE TEACHERS' RETIREMENT SYSTEM WHO
 FIRST JOINS SUCH SYSTEM ON OR AFTER JULY FIRST, TWO THOUSAND  TWENTY  IN
 ACTIVE  SERVICE  AND  WHO  HAS  CREDIT  FOR  AT LEAST ONE YEAR OF MEMBER
 SERVICE MAY BORROW, NO MORE THAN ONCE DURING EACH  TWELVE-MONTH  PERIOD,
 AN  AMOUNT, NOT LESS THAN ONE THOUSAND DOLLARS AND WHICH WOULD NOT CAUSE
 THE BALANCE  OWED  PURSUANT  TO  THIS  SECTION,  INCLUDING  ANY  AMOUNTS
 BORROWED  THEN  OUTSTANDING, TO EXCEED (I) FIFTY PERCENT OF THE MEMBER'S
 TOTAL CONTRIBUTIONS MADE PURSUANT TO SECTION  SIX  HUNDRED  THIRTEEN  OF
 THIS  ARTICLE  (INCLUDING  INTEREST  CREDITED  AT  THE RATE SET FORTH IN
 SUBDIVISION C OF THIS SECTION COMPOUNDED ANNUALLY); OR (II) FIFTY  THOU-
 SAND DOLLARS, WHICHEVER IS LESS.
   §  3.  Paragraph 2 of subdivision b of section 613-b of the retirement
 and social security law, as added by chapter 303 of the laws of 2017, is
 amended to read as follows:
   2. A member of the New York  state  and  local  employees'  retirement
 system  who first joins such system on or after January first, two thou-
 sand eighteen in active service who has credit for at least one year  of
 member  service  may  borrow, no more than once during each twelve month
 period, an amount, not less than one thousand dollars  and  which  would
 not  cause  the  balance  owed  pursuant  to this section, including any
 amounts borrowed then outstanding, to exceed (i) fifty  percent  of  the
 member's total contributions made pursuant to section [five] SIX hundred
 [seventeen] THIRTEEN of this [chapter] ARTICLE (including interest cred-
 ited  at  the rate set forth in subdivision c of such section [five] SIX
 hundred [seventeen] THIRTEEN compounded annually); or (ii)  fifty  thou-
 sand dollars, whichever is less.
   §  4.  Paragraph  2 of subdivision a of section 1207 of the retirement
 and social security law, as added by chapter 303 of the laws of 2017, is
 amended to read as follows:
   2. A member who first joins such system on or after January first, two
 thousand eighteen in active service who has credit for at least one year
 of member service may borrow, no more than once during each twelve month
 period, an amount, not less than one thousand dollars  and  which  would
 not  cause  the  balance  owed  pursuant  to this section, including any
 amounts borrowed then outstanding, to exceed (i) fifty  percent  of  the
 member's  total  contributions  made  pursuant  to section [five] TWELVE
 hundred [seventeen] FOUR of this [chapter] ARTICLE  (including  interest
 credited  at  the rate set forth in subdivision c of [such] THIS section
 [five hundred seventeen] compounded annually); or  (ii)  fifty  thousand
 dollars, whichever is less.
   §  5.  This act shall take effect immediately; provided, however, that
 sections three and four this act shall be deemed to have  been  in  full
 force and effect on and after September 12, 2017.
   FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
   This  bill  would amend Section 517-b and Section 613-a of the Retire-
 ment and Social Security Law to limit the amount of a loan that  can  be

 A. 7117                             3
 
 taken  by  members of the New York State Teachers' Retirement System who
 first join such system on or  after  July  1,  2020.  The  loan  amount,
 including  the  balances  of any outstanding loans, may not exceed fifty
 percent  of  the members' total contributions made including interest or
 fifty thousand dollars, whichever is less. The current limit  is  seven-
 ty-five  percent  of the total member contributions plus interest. Addi-
 tionally, a member must have one year of service to be eligible to  take
 a  loan,  the  loan amount may not be less than one thousand dollars and
 such member may borrow no more than once in a twelve-month period.
   It is estimated that there will be no annual cost to the employers  of
 members  of  the New York State Teachers' Retirement System if this bill
 is enacted.
   Member data is from  the  System's  most  recent  actuarial  valuation
 files,  consisting  of  data provided by the employers to the Retirement
 System.  Data distributions and statistics can be found in the  System's
 Comprehensive  Annual  Financial  Report  (CAFR).  System  assets are as
 reported in the System's financial statements, and can also be found  in
 the CAFR. Actuarial assumptions and methods are provided in the System's
 Actuarial Valuation Report.
   The  source  of  this  estimate is Fiscal Note 2019-3 dated October 5,
 2018 prepared by the Actuary of the New York State Teachers'  Retirement
 System and is intended for use only during the 2019 Legislative Session.
 I,  Richard  A.  Young,  am the Actuary for the New York State Teachers'
 Retirement System. I am a member of the American  Academy  of  Actuaries
 and  I meet the Qualification Standards of the American Academy of Actu-
 aries to render the actuarial opinion contained herein.