S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   10610
 
                           I N  A S S E M B L Y
 
                               July 6, 2022
                                ___________
 
 Introduced  by  COMMITTEE ON RULES -- (at request of M. of A. Abbate) --
   read once and referred to the Committee on Governmental Employees
 
 AN ACT to amend the retirement and social security law, in  relation  to
   enacting the "police and fire employees retention act"
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:

   Section 1. Short title. This act shall be known and may  be  cited  as
 the "police and fire employees retention act".
   §  2.  Legislative  findings.  Over  the past several years, increased
 workloads on our police and fire  employees  throughout  the  state  has
 resulted  in  a large reduction in personnel resources due to retirement
 and separation from  service.  The  loss  of  talented  and  experienced
 personnel  in these important job titles further results in a structural
 deficit of experienced trainers for our  next  generation  of  dedicated
 police  and fire personnel actively entering their public service lives.
 This legislation seeks to induce talented and experienced  personnel  to
 remain in service to the public while allowing their pension payments to
 be deferred during a specific period of time while they continue employ-
 ment.
   § 3. The retirement and social security law is amended by adding a new
 section 381-c to read as follows:
   §  381-C.  DEFERRED  RETIREMENT  OPTION  PLAN  PAYABLE  TO  MEMBERS OF
 OPTIONAL TWENTY-YEAR RETIREMENT PLAN. A PARTICIPATING EMPLOYER WHICH HAS
 ELECTED OR WHICH ELECTS, PURSUANT TO SECTION  THREE  HUNDRED  EIGHTY-ONE
 AND  ANY  SECTIONS UNDER THIS ARTICLE, WHO PARTICIPATES IN A TWENTY-YEAR
 RETIREMENT PLAN SHALL PROVIDE FOR A DEFERRED RETIREMENT OPTION PLAN.
   A. DEFERRED  RETIREMENT  OPTION  PLAN,  (HEREINAFTER  REFERRED  TO  AS
 "DROP"),  IS  A RETIREMENT PLAN UNDER WHICH AN ELIGIBLE MEMBER MAY ELECT
 TO PARTICIPATE, DEFERRING RECEIPT OF RETIREMENT BENEFITS WHILE  CONTINU-
 ING  EMPLOYMENT.  FOR THE PURPOSES OF THIS SECTION, AN "ELIGIBLE MEMBER"
 IS ANY MEMBER OR OFFICER EMPLOYED BY THE STATE, LOCAL, MUNICIPAL,  COUN-
 TY,  VILLAGE,  AUTHORITY OR DIVISION WITHIN THE STATE. DURING THE PERIOD
 OF CONTINUED EMPLOYMENT, THE ELIGIBLE MEMBER'S MONTHLY RETIREMENT  BENE-
 FIT SHALL BE DEFERRED AND HELD BY THE RETIREMENT SYSTEM ON BEHALF OF THE
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD15442-01-2
 A. 10610                            2
 
 MEMBER  PLUS  INTEREST  AT AN EFFECTIVE RATE OF ONE AND ONE-HALF PERCENT
 FOR THE SPECIFIC PERIOD OF PARTICIPATION IN DROP AS PROVIDED IN SUBDIVI-
 SION C OF THIS SECTION. UPON COMPLETION OF THE DROP PERIOD, THE ELIGIBLE
 MEMBER  SHALL  RECEIVE  THE TOTAL AMOUNT OF RETIREMENT BENEFITS DEFERRED
 UNDER DROP WITHOUT OPTIONAL MODIFICATION AS PERMITTED BY SUBDIVISIONS  D
 AND  E  OF THIS SECTION AND SHALL BEGIN TO RECEIVE THE PREVIOUSLY DETER-
 MINED NORMAL SERVICE RETIREMENT BENEFIT WITH  OPTIONAL  MODIFICATION  AS
 FURTHER PROVIDED IN SUBDIVISION D OF THIS SECTION.
   B.  ANY  ELIGIBLE MEMBER WHO IS CURRENTLY EMPLOYED PURSUANT TO SECTION
 THREE HUNDRED EIGHTY-ONE AND ANY  OR  ALL  SUBDIVISIONS  THEREUNDER  AND
 QUALIFIES TO RETIRE PURSUANT TO SECTION THREE HUNDRED EIGHTY-ONE OF THIS
 TITLE  BY  REASON  OF  COMPLETING TWENTY YEARS OF CREDITABLE SERVICE MAY
 ELECT TO PARTICIPATE IN DROP.
   C. SUCH ELECTION MUST BE ON A FORM SUPPLIED BY THE  RETIREMENT  SYSTEM
 AND  MAY  BE  FOR ANY PERIOD OF TIME NOT LESS THAN TWELVE MONTHS OR MORE
 THAN SIXTY MONTHS DURATION. ANY MEMBER WHO ELECTS TO PARTICIPATE IN DROP
 IS CONSIDERED RETIRED ON THE DAY FOLLOWING THE EXPIRATION  OF  THE  DROP
 PERIOD.  PROVIDED, HOWEVER, THAT ALL LOANS AND EXCESS CONTRIBUTIONS MUST
 BE RESOLVED BY THE DATE OF ENTRY INTO DROP AND NO  ADDITIONAL  LOANS  OR
 EXCESS  CONTRIBUTIONS  SHALL  BE  PERMITTED AFTER THE DATE OF ENTRY INTO
 DROP. UPON EXPIRATION OF  THE  TIME  PERIOD  SELECTED  BY  THE  ELIGIBLE
 MEMBER, SUCH MEMBER'S PARTICIPATION IN DROP SHALL TERMINATE.
   D.  (1) EFFECTIVE WITH THE DATE OF PARTICIPATION IN DROP, THE ELIGIBLE
 MEMBER'S NORMAL SERVICE RETIREMENT BENEFIT SHALL  BE  CALCULATED,  USING
 CREDITABLE  SERVICE AND FINAL AVERAGE SALARY AS IF THE EFFECTIVE DATE OF
 RETIREMENT WAS THE DATE OF ENTRY INTO DROP. THE AMOUNT DEFERRED PURSUANT
 TO DROP SHALL BE CALCULATED BASED UPON THE ELIGIBLE MEMBER'S ZERO OPTION
 RETIREMENT ALLOWANCE UNTIL SUCH MEMBER HAS OBTAINED THE APPLICABLE MAXI-
 MUM SERVICE RETIREMENT LIMIT BASED UPON YEARS OF SERVICE. ANY ADDITIONAL
 PARTICIPATION IN DROP AFTER A MEMBER HAS OBTAINED  THE  MAXIMUM  SERVICE
 RETIREMENT  LIMIT  BASED UPON YEARS OF SERVICE SHALL BE CALCULATED BASED
 UPON SIXTY PERCENT OF THE MEMBER'S FULL ANNUAL RETIREMENT ALLOWANCE.  IN
 ADDITION, FOR THE PURPOSES OF THIS SECTION, THE ANNUAL RETIREMENT ALLOW-
 ANCE FOR ANY MEMBER ELECTING DROP SHALL BE CALCULATED USING A THREE-YEAR
 FINAL  AVERAGE SALARY AS DEFINED ELSEWHERE IN THIS ARTICLE. THE ELIGIBLE
 MEMBER SHALL, HOWEVER, ELECT HIS OR HER OPTIONAL RETIREMENT  BENEFIT  AT
 THE COMPLETION OF THE DROP PERIOD.
   (2)  IF  THE ELIGIBLE MEMBER DIES PRIOR TO COMPLETION OF THE PERIOD OF
 PARTICIPATION IN DROP, THE ELIGIBLE MEMBER SHALL BE TREATED AS  IF  SUCH
 DROP  ELECTION DID NOT EXIST. IN LIEU OF THE DROP PAYMENT, A DEATH BENE-
 FIT SHALL BE PAYABLE CONSISTENT WITH THE TERMS OF THIS CHAPTER  AND  ALL
 SALARY  AND  SERVICE  REPORTED  FOR SUCH ELIGIBLE MEMBER DURING THE DROP
 PERIOD SHALL BE CONSIDERED IN CALCULATING THE  ELIGIBLE  MEMBER'S  DEATH
 BENEFIT.
   (3)  IF  THE  ELIGIBLE  MEMBER  IS  APPROVED  FOR  DISABILITY BENEFITS
 PROVIDED IN THIS CHAPTER DURING THE DROP  PERIOD,  THE  ELIGIBLE  MEMBER
 SHALL  BE  TREATED AS IF THE DROP ELECTION DID NOT EXIST. IN LIEU OF THE
 DROP PAYMENT, A DISABILITY RETIREMENT BENEFIT SHALL BE PAYABLE  CONSIST-
 ENT  WITH  THE TERMS OF THIS CHAPTER AND ALL SALARY AND SERVICE REPORTED
 FOR SUCH ELIGIBLE MEMBER DURING THE DROP PERIOD SHALL BE  CONSIDERED  IN
 CALCULATING THE ELIGIBLE MEMBER'S DISABILITY RETIREMENT BENEFIT.
   (4) IF AN ELIGIBLE MEMBER OTHERWISE FAILS TO COMPLETE HIS OR HER PERI-
 OD  OF SERVICE AS ELECTED PURSUANT TO SUBDIVISION C OF THIS SECTION, THE
 ELIGIBLE MEMBER SHALL BE TREATED AS IF SUCH DROP ELECTION DID NOT EXIST.
 IN LIEU OF THE DROP PAYMENT, THE NORMAL SERVICE RETIREMENT BENEFIT SHALL
 BE PAYABLE CONSISTENT WITH THE TERMS OF THIS CHAPTER AND ALL SALARY  AND
 A. 10610                            3
 
 SERVICE  REPORTED  FOR SUCH ELIGIBLE MEMBER DURING THE DROP PERIOD SHALL
 BE CONSIDERED IN CALCULATING THE ELIGIBLE  MEMBER'S  SERVICE  RETIREMENT
 BENEFIT.
   (5)  IF  AN  ELIGIBLE MEMBER REMAINS EMPLOYED AFTER HIS OR HER PARTIC-
 IPATION IN DROP IS TERMINATED, SUCH MEMBER SHALL FORFEIT ALL DROP  BENE-
 FITS  AND  CONTINUE  EMPLOYMENT  AS IF SUCH DROP ELECTION DID NOT EXIST.
 SUCH MEMBER SHALL THEN BE ELIGIBLE TO ELECT  DROP  CONSISTENT  WITH  THE
 TERMS OF THIS SECTION.
   (6)  IF  AN  ELIGIBLE MEMBER IS APPROVED FOR DISABILITY BENEFITS AFTER
 BENEFITS PAYABLE PURSUANT TO DROP HAVE BEEN PAID,  THE  ELIGIBLE  MEMBER
 MAY  ELECT  TO RECEIVE THE DISABILITY BENEFITS IN LIEU OF DROP BENEFITS,
 BUT SUCH DISABILITY BENEFITS MUST BE ACTUARIALLY ADJUSTED FOR ANY  BENE-
 FITS PAID UNDER DROP.
   E.  AT  THE  CONCLUSION  OF  THE  MEMBER'S  PARTICIPATION IN DROP, THE
 RETIREMENT SYSTEM SHALL PAY THE DEFERRED SERVICE RETIREMENT BENEFITS  IN
 ONE OF THE FOLLOWING METHODS AS ELECTED BY THE MEMBER:
   (1)  ALL  ACCRUED  DROP  BENEFITS,  PLUS INTEREST, LESS WITHHOLDING AS
 REQUIRED BY THE INTERNAL REVENUE SERVICE, SHALL  BE  PAID  TO  THE  DROP
 PARTICIPANT OR ELIGIBLE BENEFICIARY OR AS OTHERWISE DETERMINED BY OPERA-
 TION OF LAW;
   (2)  ALL  ACCRUED DROP BENEFITS, PLUS INTEREST, SHALL BE PAID FROM THE
 RETIREMENT SYSTEM TO A CUSTODIAN OF  THE  ELIGIBLE  RETIREMENT  PLAN  OR
 OTHER  ELIGIBLE  PLAN  OR  ACCOUNT  AS PROVIDED PURSUANT TO THE INTERNAL
 REVENUE CODE AS DIRECTED BY THE MEMBER OR ELIGIBLE BENEFICIARY;
   (3) A PORTION OF THE DROP BENEFITS SHALL BE PAID TO THE  DROP  PARTIC-
 IPANT OR ELIGIBLE BENEFICIARY, LESS WITHHOLDING REQUIRED BY THE INTERNAL
 REVENUE  SERVICE  AND  THE REMAINING DROP BENEFITS MAY BE ROLLED OVER AS
 OTHERWISE PERMITTED BY THE INTERNAL REVENUE CODE. FOR PURPOSES  OF  THIS
 SUBDIVISION,  THE  TERM  "ELIGIBLE  BENEFICIARY" IS ONE WHO QUALIFIES TO
 ROLLOVER BENEFITS FROM A QUALIFIED BENEFIT PLAN OR ACCOUNT  AS  PROVIDED
 BY THE INTERNAL REVENUE CODE.
   THE FORMS OF PAYMENT PROVIDED BY THIS SUBDIVISION MUST COMPLY WITH THE
 MINIMUM DISTRIBUTION REQUIREMENTS OF THE INTERNAL REVENUE CODE.
   F. THE COMPTROLLER SHALL PRESCRIBE SUCH REGULATIONS AS MAY BE REQUIRED
 FOR THE EFFECTIVE ADMINISTRATION AND IMPLEMENTATION OF THE PROVISIONS OF
 THIS SECTION.
   § 4. This act shall take effect immediately.