S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   7113
 
                        2025-2026 Regular Sessions
 
                             I N  S E N A T E
 
                               April 1, 2025
                                ___________
 
 Introduced  by  Sen. JACKSON -- read twice and ordered printed, 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
   death  benefits for members of the uniformed force of the fire depart-
   ment of the city of New York

   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  Subdivision b of section 508 of the retirement and social
 security law, as amended by chapter 476 of the laws of 2018, is  amended
 to read as follows:
   b.  1.  A  member  of a retirement system subject to the provisions of
 this article who is a police officer, firefighter,  correction  officer,
 investigator  revised  plan member or sanitation worker and is in a plan
 which permits immediate retirement upon completion of a specified period
 of service without regard to age or who is subject to the provisions  of
 section  five  hundred  four or five hundred five of this article, shall
 upon completion of ninety days  of  service  be  covered  for  financial
 protection  in  the  event of death in service pursuant to this subdivi-
 sion.
   2. Such death benefit shall be equal to three times the member's sala-
 ry raised to the next highest multiple of one thousand dollars,  but  in
 no  event  shall  it  exceed three times the maximum salary specified in
 section one hundred thirty of the civil service law or, in the case of a
 member of a retirement system other than the New  York  city  employees'
 retirement  system,  or  in  the  case  of a member of the New York city
 employees'  retirement  system  who  is  a  New  York   city   uniformed
 correction/sanitation  revised  plan  member  or an investigator revised
 plan member, the specific limitations specified for age of entrance into
 service contained in subparagraphs (b), (c), (d), (e) and (f)  of  para-
 graph two of subdivision a of this section.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD10891-02-5
 S. 7113                             2
              

 
   3.  (A)  PROVIDED FURTHER, NOTWITHSTANDING ANY OTHER PROVISION OF THIS
 ARTICLE TO THE CONTRARY, WHERE A MEMBER IS IN THE UNIFORMED FORCE OF THE
 FIRE DEPARTMENT OF THE CITY OF NEW YORK,  INCLUDING  ALL  ENHANCED  PLAN
 MEMBERS, AND WOULD HAVE BEEN ENTITLED TO EITHER A NORMAL SERVICE RETIRE-
 MENT  BENEFIT  OR  EARLY  SERVICE RETIREMENT BENEFIT AT THE TIME OF SUCH
 MEMBER'S DEATH, AS DEFINED IN SECTION FIVE HUNDRED FIVE OF THIS ARTICLE,
 AND WHERE SUCH MEMBER'S DEATH OCCURS ON OR AFTER JULY FIRST,  TWO  THOU-
 SAND TWENTY-FIVE, THE BENEFICIARY OR BENEFICIARIES MAY ELECT TO RECEIVE,
 IN  A  LUMP  SUM, IN LIEU OF ANY OTHER LESSER BENEFIT, AN AMOUNT PAYABLE
 WHICH SHALL BE EQUAL TO THE PENSION RESERVE INCLUSIVE  OF  THE  MEMBER'S
 CONTRIBUTIONS  PLUS  INTEREST,  THAT WOULD HAVE BEEN ESTABLISHED HAD THE
 MEMBER RETIRED ON THE DATE OF SUCH MEMBER'S DEATH, OR THE VALUE  OF  THE
 DEATH BENEFIT, WHICHEVER IS GREATER.
   (B)    A MEMBER, OR ON THE DEATH OF SUCH MEMBER, A PERSON NOMINATED BY
 SUCH MEMBER TO RECEIVE THEIR DEATH  BENEFIT,  MAY  PROVIDE,  BY  WRITTEN
 DESIGNATION,  DULY  EXECUTED  AND  FILED WITH THE ADMINISTRATIVE HEAD OF
 SUCH RETIREMENT SYSTEM, THAT SUCH DEATH BENEFIT AND THE PENSION  RESERVE
 INCLUSIVE OF THE MEMBER'S CONTRIBUTIONS, SHALL BE PAID IN THE FORM OF AN
 ANNUITY.  SUCH DESIGNATION SHALL BE FILED PRIOR TO OR WITHIN NINETY DAYS
 AFTER  THE  DEATH  OF  THE MEMBER.   THE AMOUNT OF SUCH ANNUITY SHALL BE
 DETERMINED AS THE ACTUARIAL EQUIVALENT OF SUCH DEATH BENEFIT AND RESERVE
 ON THE BASIS OF THE AGE OF SUCH BENEFICIARY AT THE TIME OF THE  MEMBER'S
 DEATH.    FOR  PURPOSES  OF THIS SUBDIVISION, THE MORTALITY AND INTEREST
 RATES USED IN DETERMINING THIS ANNUITY SHALL BE THE RATES IN  EFFECT  ON
 THE DATE OF THE DEATH OF SUCH MEMBER.
   § 2. This act shall take effect immediately.
   FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
   SUMMARY:  This proposed legislation would provide an alternative death
 benefit for Tier 3 members of the New York City Fire Pension Fund (FIRE)
 who die on or after July 1, 2025.

          EXPECTED INCREASE (DECREASE) IN EMPLOYER CONTRIBUTIONS
           by Fiscal Year for the first 25 years ($ in Millions)
                     Year      FIRE
                     2026      0.5
                     2027      0.5
                     2028      0.5
                     2029      0.5
                     2030      0.6
                     2031      0.6
                     2032      0.6
                     2033      0.7
                     2034      0.7
                     2035      0.7
                     2036      0.8
                     2037      0.8
                     2038      0.8
                     2039      0.9
                     2040      0.9
                     2041      0.9
                     2042      1.0
                     2043      0.8
                     2044      0.8
                     2045      0.8
                     2046      0.9
                     2047      0.9
 S. 7113                             3
 
                     2048      0.9
                     2049      0.9
                     2050      0.9
  Projected contributions include future new hires that may be impacted.
 For Fiscal Year 2051 and beyond, the expected increase in normal cost as
 a level percent of pay for impacted new entrants is approximately 0.02%.
 
 The  increase  in  employer  contributions will be allocated to New York
 City.
   PRESENT VALUE OF BENEFITS:  The  Present  Value  of  Benefits  is  the
 discounted  expected  value  of  benefits paid to current members if all
 assumptions are met, including future service accrual and pay increases.
 Future new hires are not included in this present value.

          INITIAL INCREASE (DECREASE) IN ACTUARIAL PRESENT VALUES
                    as of June 30, 2024 ($ in Millions)
 
                        Present Value (PV)                 FIRE
                         (1) PV of Employer Contributions:  6.0
                         (2) PV of Employee Contributions:  0.0
                         Total PV of Benefits (1) + (2):    6.0
 
   UNFUNDED ACCRUED LIABILITY (UAL): Actuarial  Accrued  Liabilities  are
 the  portion of the Present Value of Benefits allocated to past service.
 Changes in UAL were amortized over the expected remaining working  life-
 time of those impacted using level dollar payments.
 
                AMORTIZATION OF UNFUNDED ACCRUED LIABILITY
 
                                                 FIRE
              Increase (Decrease) in UAL:        1.7 M
              Number of Payments:                17
              Amortization Payment:              0.2 M
 
   CENSUS  DATA:  The estimates presented herein are based on preliminary
 census data collected as of June 30,  2024.  The  census  data  for  the
 impacted population is summarized below.
 
                                                 FIRE
              Active Members
              - Number Count:                    5,572
              - Average Age:                     34.1
              - Average Service:                 6.2
              - Average Salary:                  118,600
   IMPACT ON MEMBER BENEFITS: Currently, Tier 3 FIRE members are general-
 ly  entitled  to  a lump sum ordinary death benefit equal to three times
 salary plus the return of member accumulated contributions.
   Under the proposed legislation, the ordinary death benefit for Tier  3
 FIRE  members  who are otherwise eligible to receive an early retirement
 or service retirement benefit would be  the  greater  of  their  current
 death  benefit  or the value of the pension reserve that would have been
 established had they retired on the date of their death.
   The pension reserve is the actuarial  present  value  of  all  pension
 payments  expected  to be made had the member retired. This type of lump
 sum pension reserve death benefit is sometimes referred to  as  a  Death
 Gamble, and is afforded, in a similar form, to Tier 2 FIRE members.
 S. 7113                             4
 
   The  proposed legislation would further allow the ordinary death bene-
 fit for Tier 3 FIRE members to be annuitized over the life of the  bene-
 ficiary, in an actuarially equivalent manner.
   ASSUMPTIONS  AND  METHODS:  The  estimates  presented herein have been
 calculated based on the Revised 2021 Actuarial Assumptions  and  Methods
 of the impacted retirement systems. In addition:
   *  New  entrants were assumed to replace exiting members so that total
 payroll increases by 3% each year for impacted groups. New entrant demo-
 graphics were developed based on data for recent new hires and actuarial
 judgement.
   RISK AND UNCERTAINTY: The costs presented in this Fiscal  Note  depend
 highly  on  the  actuarial  assumptions, methods, and models used, demo-
 graphics of the impacted population, and other factors such  as  invest-
 ment,  contribution, and other risks. If actual experience deviates from
 actuarial  assumptions,  the  actual  costs  could  differ  from   those
 presented  herein.  Quantifying  these risks is beyond the scope of this
 Fiscal Note.
   This Fiscal Note is intended to measure  pension-related  impacts  and
 does  not  include other potential costs (e.g., administrative and Other
 Postemployment Benefits). This Fiscal Note does not reflect any  chapter
 laws that may have been enacted during the current legislative session.
   Ordinary  death  benefits  which  would be payable in the event of the
 death of a non-finalized pensioner are not included in  determining  the
 costs  of  this  Fiscal  Note.  To  the  extent  that such non-finalized
 pensioners benefit from this proposed legislation, the  costs  disclosed
 in this Fiscal Note will be greater.
   STATEMENT OF ACTUARIAL OPINION: Marek Tyszkiewicz and Gregory Zelikov-
 sky  are members of the Society of Actuaries and the American Academy of
 Actuaries. We are members of NYCERS but do not believe  it  impairs  our
 objectivity,  and  we  meet  the Qualification Standards of the American
 Academy of Actuaries to render the actuarial opinion  contained  herein.
 To  the  best  of  our 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 2025-37 dated  March  31,
 2025  was prepared by the Chief Actuary for the New York City Retirement
 Systems and Pension Funds and is intended for use only during  the  2025
 Legislative Session.