S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   5767
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                              March 18, 2021
                                ___________
 
 Introduced  by  Sen.  SAVINO -- read twice and ordered printed, and when
   printed to be committed to the Committee on Civil Service and Pensions
 
 AN ACT to amend the administrative code of the  city  of  New  York,  in
   relation  to  extending  the benefits of the variable supplements fund
   for transit police members of the New York city employees'  retirement
   system
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1.  Paragraph (c) of subdivision 1 of section  13-191  of  the
 administrative  code  of the city of New York, as amended by chapter 577
 of the laws of 1992, is amended to read as follows:
   (c) "Beneficiary". Any person who receives a retirement  allowance  by
 reason  of  having  retired,  on  or after [July first, nineteen hundred
 eighty-seven] OCTOBER FIRST, NINETEEN HUNDRED  SIXTY-EIGHT  for  service
 (with  credit  for  twenty  or  more years of service toward the minimum
 period) as a transit police officer; provided, that no person who held a
 rank or position as a transit police superior  officer,  as  defined  in
 subdivision eighty-four of section 13-101 of this title who, on or after
 May  first,  nineteen  hundred ninety-two, subsequently became a transit
 police officer shall be considered a beneficiary unless such person  (1)
 subsequently  performed  at  least  three  years of service as a transit
 police officer  or  (2)  returned  to  service,  from  the  position  of
 sergeant,  as  a transit police officer during the eighteen month proba-
 tionary period, or such other probationary period as may  be  applicable
 or  (3) returned to service as a transit police officer during the three
 year period specified in paragraph (e) of  subdivision  one  of  section
 seventy-five  of  the civil service law, or (4) returned to service as a
 transit police officer as the result of a hearing conducted pursuant  to
 applicable law.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD10053-02-1

              

 S. 5767                             2
 
   § 2.  Paragraph (b) of subdivision 1 of section 13-192 of the adminis-
 trative  code  of the city of New York, as amended by chapter 720 of the
 laws of 1994, is amended to read as follows:
   (b)  "Beneficiary".  Any person who receives a retirement allowance by
 reason of having retired, on or  after  [July  first,  nineteen  hundred
 eighty-seven,]  OCTOBER FIRST, NINETEEN HUNDRED SIXTY-EIGHT, for service
 (with credit for twenty or more years  of  service  toward  the  minimum
 period)  as  a  transit  police  member and as a transit police superior
 officer; provided, however, that where a person who held or holds a rank
 or position as a transit police superior officer, subsequently and on or
 after May first, nineteen hundred ninety-two became or becomes a transit
 police officer, and while a transit police officer, retired  or  retires
 for service under such circumstances that he or she would have qualified
 as  a  beneficiary  under the provisions of paragraph (c) of subdivision
 one of section 13-191 of this title (other than  the  proviso  thereof),
 but  did  not  or does not qualify as a beneficiary under such paragraph
 (c) because he or she was or is disqualified by the terms of such provi-
 so, such retiree shall nevertheless be deemed to be a beneficiary  under
 the provisions of this section.
   § 3. This act shall take effect immediately.
   FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
   SUMMARY OF BILL: This proposed legislation would amend Sections 13-191
 and  13-192  of the Administrative Code of the City of New York (ACCNY),
 both enacted by Chapter 844 of the Laws of 1987, to extend the eligibil-
 ity provisions providing for the payment of Transit Police Officers' and
 Transit Police Superior Officers' Variable Supplements Funds (VSF) bene-
 fits to certain retirees.
   Specifically, this proposed legislation would provide for payments  to
 former  New  York City Employees' Retirement System (NYCERS) members who
 are retired for service from the  New  York  City  Transit  Police  (TP)
 between  October  1,  1968 and June 30, 1987 (Prior Retirees) with 20 or
 more years of service. These benefits would be paid from  the  following
 VSFs (referred to hereafter as the Impacted VSFs):
   *  Transit Police Officers' Variable Supplements Fund (TPOVSF), and
   *  Transit   Police   Superior  Officers'  Variable  Supplements  Fund
 (TPSOVSF).
   Effective Date: Upon enactment.
   IMPACT ON BENEFITS - VSF PAYMENTS: Each of the Impacted VSFs currently
 provides supplemental non-pension benefits to former NYCERS members  who
 retired  for  service  on  or after July 1, 1987 from TP with 20 or more
 years of service.
   The amount of VSF benefits paid  is  currently  $12,000  per  Calendar
 Year.
   These VSF benefits are payable on an annual basis around December 15th
 to  eligible  former  NYCERS  members  for their lifetimes. There are no
 optional forms of payment. Upon the death of  the  NYCERS  retiree,  VSF
 payments cease.
   If  the  proposed  legislation  were to be enacted, all Prior Retirees
 would become immediately eligible for VSF benefits on the December  15th
 subsequent to the Effective Date and for each year thereafter.
   For  the  purposes  of  this Fiscal Note, the Actuary has assumed that
 benefits payable under this proposed legislation  are  prospective  only
 (i.e. there would be no retroactive payments for VSF benefits due before
 the Effective Date for such Prior Retirees).
   FINANCIAL  IMPACT  -  PRESENT VALUES: Based on the census data and the
 actuarial assumptions and methods noted herein,  the  enactment  of  the

 S. 5767                             3
 
 proposed legislation would increase the Present Value of Future Benefits
 (PVFB)  of  the  Impacted VSFs by approximately $27.8 million as of June
 30, 2020.
   There  are  no  active  TP members of NYCERS and therefore there is no
 mechanism in place for funding the TP VSFs since the VSFs' funding allo-
 cation method normally would be based on the ratio of active  TP  member
 salaries  to salaries of all active members in NYCERS. As a consequence,
 a transfer from NYCERS to the Impacted VSFs would be necessary  to  fund
 the additional VSF benefit obligations.
   FINANCIAL  IMPACT - EMPLOYER CONTRIBUTIONS: In accordance with Section
 13-638.2(k-2) of the  Administrative  Code  of  the  City  of  New  York
 (ACCNY),  new  Unfunded  Accrued Liability (UAL) attributable to benefit
 changes are to be amortized as determined by the Actuary, but are gener-
 ally amortized over the remaining working lifetime of those impacted  by
 the benefit changes.
   For  the  purposes of this Fiscal Note, since those that would benefit
 are retired, and therefore  have  no  remaining  working  lifetime,  the
 entire  increase  in  UAL (or PVFB) of $27.8 million would be recognized
 immediately.
   CONTRIBUTION TIMING: For the purposes  of  this  Fiscal  Note,  it  is
 assumed  that  the  first  VSF benefit payment would be made in December
 2021 and therefore, changes in the PVFB, and UAL would be reflected  for
 the  first  time  in the June 30, 2020 actuarial valuation of NYCERS. In
 accordance with the One-Year Lag Methodology (OYLM)  used  to  determine
 employer  contributions, the increase in employer contributions would be
 reflected in Fiscal Year 2022.
   CENSUS DATA: The estimates presented herein are based  on  the  census
 data  used in the Preliminary June 30, 2020 (Lag) actuarial valuation of
 NYCERS to determine the Preliminary Fiscal Year 2022  employer  contrib-
 utions.
   The  393  Prior  Retirees  as  of  June 30, 2020 had an average age of
 approximately 79.6 years.
   ACTUARIAL ASSUMPTIONS AND METHODS: The changes in  the  PVFB  and  UAL
 presented herein have been calculated based on the actuarial assumptions
 and  methods  in effect for the June 30, 2019 (Lag) actuarial valuations
 used to determine the Preliminary Fiscal  Year  2021  employer  contrib-
 utions of NYCERS.
   The Actuary is proposing a set of changes for use in the June 30, 2019
 (Lag)  actuarial  valuations of NYCRS to determine the Final Fiscal Year
 2021 Employer Contributions (2021 A&M). If the 2021 A&M is enacted it is
 estimated that it would produce an increase in the PVB and UAL  that  is
 approximately 1% less than the results shown above.
   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  NYCERS  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 initial, additional adminis-
 trative costs of NYCERS and other New York City  agencies  to  implement
 the proposed legislation.
   STATEMENT  OF ACTUARIAL OPINION: I, Sherry S. Chan, am the Chief Actu-
 ary for, and independent of, the New York City  Retirement  Systems  and

 S. 5767                             4
 
 Pension  Funds.  I  am a Fellow of the Society of Actuaries, an Enrolled
 Actuary under the Employee Retirement Income and Security Act of 1974, a
 Member of the American Academy of Actuaries, and a Fellow of the Confer-
 ence  of Consulting 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 2021-08 dated March 8,
 2021, was prepared by the Chief Actuary for the New York City Employees'
 Retirement System. This estimate is intended for  use  only  during  the
 2021 Legislative Session.