S T A T E O F N E W Y O R K
________________________________________________________________________
5467
2023-2024 Regular Sessions
I N S E N A T E
March 6, 2023
___________
Introduced by Sens. GOUNARDES, KENNEDY -- read twice and ordered print-
ed, and when printed to be committed to the Committee on Civil Service
and Pensions
AN ACT to amend the retirement and social security law, in relation to
primary social security retirement benefits for police/fire members
who are members of the New York city fire department pension fund
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Section 505 of the retirement and social security law, as
amended by chapter 18 of the laws of 2012, is amended to read as
follows:
§ 505. Service retirement benefits; police/fire members, New York city
uniformed correction/sanitation revised plan members and investigator
revised plan members. a. The normal service retirement benefit for
police/fire members, New York city uniformed correction/sanitation
revised plan members and investigator revised plan members at normal
retirement age shall be a pension equal to fifty percent of final aver-
age salary, less fifty percent of the primary social security retirement
benefit commencing at age sixty-two, as provided in section five hundred
eleven of this article, PROVIDED, HOWEVER, THAT THE COMPUTATION OF THE
NORMAL SERVICE RETIREMENT BENEFIT OF MEMBERS OF THE NEW YORK CITY FIRE
DEPARTMENT PENSION FUND, SHALL NOT BE REDUCED BY THE PRIMARY SOCIAL
SECURITY RETIREMENT BENEFIT COMMENCING AT AGE SIXTY-TWO AS PROVIDED IN
SECTION FIVE HUNDRED ELEVEN OF THIS ARTICLE.
b. The early service retirement benefit for police/fire members, New
York city uniformed correction/sanitation revised plan members and
investigator revised plan members shall be a pension equal to two and
one-tenths percent of final average salary times years of credited
service at the completion of twenty years of service or upon attainment
of age sixty-two, increased by one-third of one percent of final average
salary for each month of service in excess of twenty years, but not in
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD07867-02-3
S. 5467 2
excess of fifty percent of final average salary, less fifty percent of
the primary social security retirement benefit commencing at age sixty-
two as provided in section five hundred eleven of this article,
provided, however, that New York city police/fire revised plan members,
New York city uniformed correction/sanitation revised plan members and
investigator revised plan members shall not be eligible to retire for
service prior to the attainment of twenty years of credited service, AND
PROVIDED FURTHER THAT THE EARLY SERVICE RETIREMENT BENEFIT OF MEMBERS OF
THE NEW YORK CITY FIRE DEPARTMENT PENSION FUND SHALL NOT BE REDUCED BY
THE PRIMARY SOCIAL SECURITY RETIREMENT BENEFIT COMMENCING AT AGE SIXTY-
TWO AS PROVIDED BY SECTION FIVE HUNDRED ELEVEN OF THIS ARTICLE.
c. A police/fire member, a New York city uniformed
correction/sanitation revised plan member or an investigator revised
plan member who retires with twenty-two years of credited service or
less may become eligible for annual escalation of the service retirement
benefit if he OR SHE elects to have the payment of his OR HER benefit
commence on the date he OR SHE would have completed twenty-two years and
one month or more of service. In such event, the service retirement
benefit shall equal two percent of final average salary for each year of
credited service, less fifty percent of the primary social security
retirement benefit commencing at age sixty-two as provided in section
five hundred eleven of this article, PROVIDED, HOWEVER, THAT THE SERVICE
RETIREMENT BENEFIT OF MEMBERS OF THE NEW YORK CITY FIRE DEPARTMENT
PENSION FUND SHALL NOT BE REDUCED BY THE PRIMARY SOCIAL SECURITY RETIRE-
MENT BENEFIT COMMENCING AT AGE SIXTY-TWO AS PROVIDED BY SECTION FIVE
HUNDRED ELEVEN OF THIS ARTICLE.
§ 2. Section 511 of the retirement and social security law is amended
by adding a new subdivision h to read as follows:
H. NOTWITHSTANDING ANY PROVISION OF LAW TO THE CONTRARY, THIS SECTION
SHALL NOT APPLY TO MEMBERS OF THE NEW YORK CITY FIRE DEPARTMENT PENSION
FUND WHO RECEIVE A SERVICE RETIREMENT BENEFIT PURSUANT TO SECTION FIVE
HUNDRED FIVE OF THIS ARTICLE OR A DEFERRED VESTED BENEFIT PURSUANT TO
SECTION FIVE HUNDRED SIXTEEN OF THIS ARTICLE.
§ 3. Subdivision c of section 516 of the retirement and social securi-
ty law, as amended by chapter 18 of the laws of 2012, is amended to read
as follows:
c. The deferred vested benefit of police/fire members, New York city
police/fire revised plan members, New York city uniformed
correction/sanitation revised plan members or investigator revised plan
members shall be a pension commencing at early retirement age equal to
two and one-tenths percent of final average salary times years of cred-
ited service, less fifty percent of the primary social security retire-
ment benefit commencing at age sixty-two, as provided in section five
hundred eleven of this article, PROVIDED HOWEVER THAT THE DEFERRED VEST-
ED BENEFIT OF MEMBERS OF THE NEW YORK CITY FIRE DEPARTMENT PENSION FUND
AND REVISED PLAN MEMBERS WHO ARE MEMBERS OF THE NEW YORK CITY FIRE
DEPARTMENT PENSION FUND SHALL NOT BE REDUCED BY THE PRIMARY SOCIAL SECU-
RITY RETIREMENT BENEFIT COMMENCING AT AGE SIXTY-TWO AS PROVIDED BY
SECTION FIVE HUNDRED ELEVEN OF THIS ARTICLE. A police/fire member, a New
York city police/fire revised plan member, a New York city uniformed
correction/sanitation revised plan member or investigator revised plan
member may elect to receive his OR HER vested benefit commencing at
early retirement age or age fifty-five. If the vested benefit commences
before early retirement age, the benefit shall be reduced by one-fif-
teenth for each year, if any, that the member's early retirement age is
in excess of age sixty, and by one-thirtieth for each additional year by
S. 5467 3
which the vested benefit commences prior to early retirement age. If
such vested benefit is deferred until after such member's normal retire-
ment age, the benefit shall be computed and subject to annual escalation
in the same manner as provided for an early retirement benefit pursuant
to subdivision c of section five hundred five of this article.
§ 4. Notwithstanding the provisions of section 13-379 of the adminis-
trative code of the city of New York, the provisions of this act shall
apply to chapter three of title thirteen of the administrative code of
the city of New York.
§ 5. This act shall take effect immediately.
FISCAL NOTE.-Pursuant to Legislative Law, Section 50:
SUMMARY OF BILL: This proposed legislation would amend Sections 505,
511, and 516 of the Retirement and Social Security Law (RSSL) to elimi-
nate the offset equal to 50% of the primary social security benefit in
the service, early service, and vested retirement benefits for Tier 3
original, modified, and enhanced plan members of the New York City Fire
Pension Fund (FIRE).
Effective Date: Upon enactment.
IMPACT ON BENEFITS: Currently, the Tier 3 normal service retirement,
early service retirement, and vested retirement benefits are subject to
an offset equal to 50% of the primary social security benefit as defined
in RSSL Section 511 beginning at age 62. Under the proposed legis-
lation, the offset for such benefits would be eliminated resulting in an
increase in benefits.
FINANCIAL IMPACT: Based on the census data and the actuarial assump-
tions and methods described herein, the enactment of this proposed
legislation would result in an initial increase in the Present Value of
Future Benefits (PVFB) and the present value of future employer contrib-
utions of approximately $94.4 million.
The financial impact will increase as the impacted populations
increase over time. The estimate of the increase in annual employer
contributions for Fiscal Years 2024 through 2028 are shown in the table
below.
Fiscal Increase in Employer
Year Contributions
($ Millions)
2024 $6.4
2025 $7.1
2026 $7.9
2027 $8.6
2028 $9.3
New Unfunded Accrued Liability (UAL) attributable to benefit changes
are generally amortized over the remaining working lifetime of those
impacted by the benefit changes. The remaining working lifetime for this
group is approximately 19 years and the increase in UAL was therefore
amortized over a 19-year period (18 payments under the One-Year Lag
Methodology) using level dollar payments.
CENSUS DATA: The estimates presented herein are based on the census
data to be used in the June 30, 2022 actuarial valuation of FIRE to
determine the Preliminary Fiscal Year 2024 employer contributions.
The 4,469 active FIRE Tier 3 members as of June 30, 2022 had an aver-
age age of approximately 32.9 years, average service of approximately
5.2 years, and an average salary of approximately $106,300.
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ACTUARIAL ASSUMPTIONS AND METHODS: The estimates presented herein have
been calculated based on the actuarial assumptions and methods to be
used for the Preliminary Fiscal Year 2024 employer contributions of
FIRE. New entrants were projected to replace the members expected to
leave the active population to maintain a steady-state population. New
entrant demographics were developed based on data for recent new hires
and actuarial judgement.
For the purposes of this Fiscal Note, it is assumed that the changes
would be reflected for the first time in the June 30, 2022 actuarial
valuation of FIRE used to determine employer contributions for Fiscal
Year 2024.
RISK AND UNCERTAINTY: The costs presented in this Fiscal Note depend
highly on the realization of the actuarial assumptions used, demograph-
ics of the impacted population and other factors such as investment,
contribution, and other risks. If actual experience deviates from actu-
arial 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:
* The initial, additional administrative costs to implement the
proposed legislation.
* Pension costs for future members of FIRE hired on or after 7/1/2026.
* Cost analyses relating to provisions contained in RSSL Section
500(c).
STATEMENT OF ACTUARIAL OPINION: I, Marek Tyszkiewicz, am the Chief
Actuary for, and independent of, the New York City Retirement Systems
and Pension Funds. I am an Associate 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 2023-02 dated February
24, 2023 was prepared by the Chief Actuary for the New York City Fire
Pension Fund. This estimate is intended for use only during the 2023
Legislative Session.
