S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   9991
 
                           I N  A S S E M B L Y
 
                              April 29, 2022
                                ___________
 
 Introduced by M. of A. ABBATE -- read once and referred to the Committee
   on Governmental Employees
 
 AN  ACT  to  amend  the  administrative code of the city of New York, in
   relation to promotions of lieutenants
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:

   Section  1.  Section  14-114 of the administrative code of the city of
 New York is amended by adding a new subdivision d to read as follows:
   D. WHEN A LIEUTENANT SHALL HAVE SERVED IN THE RANK OF LIEUTENANT FOR A
 PERIOD OF FIFTEEN YEARS, HE OR SHE SHALL HAVE THE SAME RIGHTS IN RESPECT
 TO THE POLICE PENSION FUND AS A LIEUTENANT DETAILED TO ACT AS LIEUTENANT
 COMMANDER DETECTIVE SQUAD OR LIEUTENANT SPECIAL ASSIGNMENT.
   § 2. This act shall take effect immediately.
   FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
   SUMMARY OF BILL: This proposed legislation would amend  Administrative
 Code of the City of New York (ACCNY) Section 14-114 to allow for a Lieu-
 tenant  of  the  New  York City Police Department (NYPD), who has been a
 Lieutenant for at least 15 years, to have the same rights in respect  to
 the  New York City Police Pension Fund (POLICE) as a Lieutenant detailed
 to act as a Lieutenant Commander Detective Squad or  Lieutenant  Special
 Assignment.
   Effective Date: Upon enactment.
   IMPACT ON BENEFITS: The proposed legislation would permit Lieutenants,
 who have served in the rank of Lieutenant for at least 15 years, to have
 their pension calculations based on a higher-grade salary.
   A  Lieutenant,  assuming a service retirement benefit with 20 years of
 service (15 of which was in the title of a Lieutenant), who would  bene-
 fit  under  this  proposed  legislation,  if  enacted,  would receive an
 increase in their annual pension benefit,  due  to  the  assumed  higher
 salary grade and overtime, of approximately $8,000 per year.
   Based on this increase and an estimate of the number of POLICE members
 that are expected to be impacted by this change, it is estimated that if
 this  proposed  legislation  is  enacted,  the annual increase in POLICE
 pension benefits paid will be approximately $215,000 per year.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD09981-02-2
 A. 9991                             2
 
   With respect to an individual member, the impact on  benefits  due  to
 this  proposed  legislation could vary greatly depending on the member's
 age, years of service, retirement cause, and Tier.
   FINANCIAL  IMPACT - PRESENT VALUES: Based on the actuarial assumptions
 and methods described herein, the enactment of this proposed legislation
 would increase the Present Value of Future Benefits (PVFB)  by  approxi-
 mately $2.8 million.
   FINANCIAL  IMPACT  - ANNUAL EMPLOYER CONTRIBUTIONS: In accordance with
 ACCNY  Section  13-638.2(k-2),  new  Unfunded  Accrued  Liability  (UAL)
 attributable to benefit changes are to be amortized as determined by the
 Actuary  but  generally  over  the  remaining  working lifetime of those
 impacted by the benefit changes. Since the  number  of  Lieutenants  who
 will  retire  with  15  or more years in rank cannot be known in advance
 with credibility, the PVFB due to this legislation has been  treated  as
 an actuarial loss at the affected members' retirement.
   For  the  purposes  of this Fiscal Note, the increase in UAL was amor-
 tized over  a  15-year  period  (14  payments  under  the  One-Year  Lag
 Methodology(OYLM))  using  level  dollar  payments.  This  results in an
 increase in annual employer contributions of approximately $326,000 each
 year.
   CONTRIBUTION TIMING: For the purposes  of  this  Fiscal  Note,  it  is
 assumed  that  the changes in the PVFB and annual employer contributions
 would be reflected for the first time in the Final June 30, 2022 actuar-
 ial valuation of POLICE. In accordance with the OYLM used  to  determine
 employer  contributions,  the  increase  in employer contributions would
 first be reflected in Fiscal Year 2024. Future years' costs in  addition
 to  the  aforementioned cost would depend on the number of retirees that
 benefit under the legislation amongst other factors.
   CENSUS DATA: These estimates are based on data provided  by  the  NYPD
 Lieutenants Benevolent Association which was not audited but was checked
 for reasonableness.  Below is a summary of the data provided:
 
   * Salary (excluding overtime)

      o Lieutenant - $135,511
      o Lieutenant  Commander  of  Detective Squad and Lieutenant Special
         Assignment - $149,067
 
   * Lieutenants who retired with 15+ years in rank  -  62  retired  from
 January 1, 2020 through January 1, 2022.
 
   ACTUARIAL  ASSUMPTIONS AND METHODS: The changes in the PVFB and annual
 employer contributions presented herein have been  calculated  based  on
 the actuarial assumptions and methods in effect for the Preliminary June
 30,  2021  (Lag)  actuarial valuations used to determine the Preliminary
 Fiscal Year 2023 employer contributions of POLICE.
   RISK AND UNCERTAINTY: The costs presented in this Fiscal  Note  depend
 highly  on the realization of the actuarial assumptions used, as well as
 certain demographic characteristics of  the  Plan  and  other  exogenous
 factors  such  as  investment,  contribution, and other risks. If actual
 experience deviates from actuarial assumptions, the actual  costs  could
 differ  from  those  presented  herein.  Costs are also dependent on the
 actuarial methods used, and therefore different actuarial methods  could
 produce  different results.  Quantifying these risks is beyond the scope
 of this Fiscal Note.
   Not measured in this Fiscal Note are the following:
 A. 9991                             3
 
      * The initial, additional administrative costs of POLICE and  other
 New York City agencies to implement the proposed legislation.
      *  The  impact of this proposed legislation on Other Postemployment
 Benefit (OPEB) costs.
 
   STATEMENT OF ACTUARIAL OPINION: I, Michael J. Samet,  am  the  Interim
 Chief  Actuary  for,  and  independent  of, the New York City Retirement
 Systems and Pension Funds. I am a Fellow of the Society of 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. To the  best  of  my  knowledge,  the  results
 contained  herein  have  been  prepared  in  accordance  with  generally
 accepted actuarial principles and  procedures  and  with  the  Actuarial
 Standards of Practice issued by the Actuarial Standards Board.
   FISCAL  NOTE  IDENTIFICATION: This Fiscal Note 2022-33 dated April 22,
 2022 was prepared by the Interim Chief Actuary for  the  New  York  City
 Police  Pension  Fund. This estimate is intended for use only during the
 2022 Legislative Session.