Bill Text: NY A10003 | 2015-2016 | General Assembly | Amended

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Bill Title: Eliminates restrictions upon transferring between public retirement systems.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2016-06-16 - substituted by s7386a [A10003 Detail]

Download: New_York-2015-A10003-Amended.html

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                STATE OF NEW YORK
        ________________________________________________________________________
                                        10003--A
                   IN ASSEMBLY
                                       May 4, 2016
                                       ___________
        Introduced by M. of A. ABBATE -- read once and referred to the Committee
          on  Governmental  Employees  --  committee  discharged,  bill amended,
          ordered reprinted as amended and recommitted to said committee
        AN ACT to amend the retirement and social security law, in  relation  to
          the  transfer  of  members  between  public retirement systems; and to
          repeal subdivisions g and i of section 43 of such law relating thereto
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
     1    Section  1.  Subdivisions  b and d of section 43 of the retirement and
     2  social security law, subdivision b as amended by chapter 724 of the laws
     3  of 1959 and subdivision d as amended by chapter 905 of the laws of 1971,
     4  are amended to read as follows:
     5    b. In order to effect such a transfer, a member must  give  notice  to
     6  the administrative head of the retirement system of which he or she is a
     7  member,  prior  to his or her withdrawal therefrom, of his or her inten-
     8  tion to enter such other retirement system [within one year. In the case
     9  of a person who has withdrawn from a  retirement  system  and  has  been
    10  entitled  to  at  least  thirty  years  of  total service credit in such
    11  system, however, such notice may be given within three  years  from  the
    12  time  of such withdrawal.  In the case of a person who was a member of a
    13  retirement system, and who while under such status becomes a  member  of
    14  such  second  retirement  system, and who has not withdrawn his contrib-
    15  utions to the first  such  retirement  system,  any  provisions  of  law
    16  notwithstanding,  such  notice may be given on or before June thirtieth,
    17  nineteen hundred fifty-nine]. A person so transferring from one  retire-
    18  ment  system  to  another  shall  be deemed to have been a member of the
    19  system to which he or she has transferred during the  entire  period  of
    20  membership service credited to him or her in the system from which he or
    21  she  has  transferred.  Such transferee, however, shall not receive more
    22  than three per cent interest on his or her contributions and accumulated
    23  contributions unless he or she has continuously been a member in  either
    24  the system from which or to which he or she is transferring since a date
    25  prior  to  July  first,  nineteen hundred forty-three. This shall not be
    26  construed to prevent a change in the interest rate to such member if the
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD15108-05-6
        A. 10003--A                         2
     1  interest rate payable to other members of the system to which he or  she
     2  has  transferred  is changed. Any member who heretofore transferred from
     3  one retirement system to another shall, commencing  with  the  effective
     4  date  of  [this  act] chapter nine hundred three of the laws of nineteen
     5  hundred fifty-seven, be entitled to  the  same  rights,  privileges  and
     6  benefits,  and shall be subject to the same obligations, as a transferee
     7  who [hereafter] thereafter transfers. He or she shall receive no  credit
     8  for  prior  service,  except as hereinafter provided. He or she shall be
     9  permitted to deposit in the second retirement system the total amount of
    10  his contributions withdrawn from the first retirement system. [Upon such
    11  deposit within one year or within three years,  or  on  or  before  June
    12  thirtieth,  nineteen  hundred  fifty-nine, as the case may be, he or the
    13  administrative head of the system to which he desires to transfer, shall
    14  request the administrative head of the first retirement system to trans-
    15  fer to the second retirement system a credit on account of  his  member-
    16  ship in such system.]
    17    d.  Such  reserve  shall  be  transferred from the appropriate fund or
    18  funds of the first system to the appropriate fund or funds of the second
    19  system [within one year from the date of the request for a  transfer  of
    20  credit]. Such member, thereupon, shall be given such status and credited
    21  with  such  service in the second retirement system as he was allowed in
    22  the first retirement system. Such contributor, notwithstanding any other
    23  provision of law, shall on  retirement  [after  three  years  of  member
    24  service  in the second retirement system] be entitled to a pension based
    25  on salary earned during member service [in either retirement system, or]
    26  in both retirement systems together, [whichever may produce the  greater
    27  pension] pursuant to the statutory requirements of the second retirement
    28  system.  [No  such contributor, however, shall be entitled on retirement
    29  within three years of the date of his transfer, to a greater  or  lesser
    30  pension for such service rendered before his transfer than he would have
    31  received  had  he  remained  under  the  pension provisions of the first
    32  retirement system.]
    33    § 2. Subdivisions g and i of section 43 of the retirement  and  social
    34  security law are REPEALED.
    35    § 3. This act shall take effect immediately.
          FISCAL NOTE.--Pursuant to Legislative Law Section 50:
          PROVISIONS  OF  PROPOSED  LEGISLATION: This proposed legislation would
        amend subdivisions b and d of Section 43 of the  Retirement  and  Social
        Security  Law (RSSL) to simplify the administration of transfers between
        the retirement systems within New York State. The  proposed  legislation
        would  also  repeal  subdivisions  g  and i of Section 43 of the RSSL to
        simplify the statute  by  removing  outdated  language  that  no  longer
        affects members of any of the retirement systems.
          The  effective  date  of the proposed legislation would be the date of
        enactment.
          IMPACT ON BENEFITS: The proposed change to subdivision b of Section 43
        of the RSSL would eliminate the one-year time limit for members to  give
        notice  of  their  intent  to  transfer  between retirement systems. The
        proposed change to subdivision d of Section 43 of the RSSL would  elimi-
        nate  the  requirement that a transferee acquire at least three years of
        service in the second retirement system in order to have  their  pension
        calculated  using  service  credit  and  salary  history as if they were
        always in the second retirement system.
          FINANCIAL IMPACT: The number of members expected  to  be  impacted  by
        this  proposed legislation cannot be readily determined.  However, based
        on the small number of members who would  have  been  affected  by  this
        A. 10003--A                         3
        change  in  the past, enactment of this proposed legislation is expected
        to result in an increase in  employer  contributions  of  no  more  than
        $25,000  per  year, in total, to the New York City Employees' Retirement
        System,  the  New York City Teachers' Retirement System and the New York
        City Board of Education Retirement System.
          FINANCIAL IMPACT - ADMINISTRATIVE  EXPENSES:  The  enactment  of  this
        legislation  is expected to serve to alleviate administrative burdens by
        reducing multiple transfers by members  who  change  employment  several
        times.
          STATEMENT  OF ACTUARIAL OPINION: I, Sherry S. Chan, am the Chief Actu-
        ary for the New York City Retirement Systems. I am an Associate  of  the
        Society of Actuaries, a Fellow of the Conference of Consulting Actuaries
        and a Member of the American Academy of Actuaries. I meet the Qualifica-
        tion  Standards of the American Academy of Actuaries to render the actu-
        arial opinion contained herein.
          FISCAL NOTE IDENTIFICATION: This estimate is  intended  for  use  only
        during  the  2016  Legislative Session. It is Fiscal Note 2016-16, dated
        April 5, 2016 prepared by the  Chief  Actuary  for  the  New  York  City
        Employees'  Retirement  System,  the  New York City Teachers' Retirement
        System and the New York City Board of Education Retirement System.
          FISCAL NOTE.--Pursuant to Legislative Law Section 50:
          This bill will remove the one year time  limit  for  members  to  give
        notice  of their intent to transfer between public retirement systems in
        New York State. In addition this bill will remove the  requirement  that
        the  transferee  attain  at  least  three years of service credit in the
        second system in order to have their pension  calculated  using  service
        credit  and  salary history as if they were always in the second system.
        Lastly, this bill repeals subdivisions g and i  of  Section  43  of  the
        Retirement  and Social Security Law that no longer affect members of the
        retirement system.
          If this legislation is enacted during the 2016 legislative session, we
        estimate that the annual cost will be negligible.
          Summary of relevant resources:
          The membership data used in  measuring  the  impact  of  the  proposed
        change  was  the same as that used in the March 31, 2015 actuarial valu-
        ation. Distributions and other statistics  can  be  found  in  the  2015
        Report  of  the  Actuary  and  the  2015  Comprehensive Annual Financial
        Report.
          The actuarial assumptions and methods used are described in  the  2015
        Annual Report to the Comptroller on Actuarial Assumptions, and the Codes
        Rules and Regulations of the State of New York: Audit and Control.
          The Market Assets and GASB Disclosures are found in the March 31, 2015
        New  York  State  and  Local  Retirement System Financial Statements and
        Supplementary Information.
          I am a member of the American Academy of Actuaries and meet the Quali-
        fication Standards to render the actuarial opinion contained herein.
          This estimate, dated June 7, 2016, and intended for  use  only  during
        the  2016  Legislative Session, is Fiscal Note No. 2016-113, prepared by
        the Actuary for the New York State and Local Retirement System.
          FISCAL NOTE.--Pursuant to Legislative Law Section 50:
          This bill would amend Section 43 of the Retirement and Social Security
        Law to remove the one year time limit for  members  to  give  notice  of
        their  intent  to  transfer  between retirement systems. This bill would
        also remove the restriction on a member who transfers  that  he/she  may
        not  retire  within  three  years  and receive a greater benefit for the
        service rendered before transfer than he/she would have  received  under
        A. 10003--A                         4
        the prior retirement system. Additionally, this bill would repeal subdi-
        visions g and i of Section 43.
          The  annual  cost  to  the  employers of members of the New York State
        Teachers' Retirement System is estimated to be negligible if  this  bill
        is enacted.
          Employee  data  is  from  the System's most recent actuarial valuation
        files, consisting of data provided by the employers  to  the  Retirement
        System.  Data  distributions and statistics can be found in the System's
        Comprehensive Annual Financial  Report  (CAFR).  System  assets  are  as
        reported  in the System's financial statements, and can also be found in
        the CAFR. Actuarial assumptions and methods are provided in the System's
        Actuarial Valuation Report.
          The source of this estimate is Fiscal Note 2016-27 dated June 9,  2016
        prepared  by  the  Actuary  of  the  New York State Teachers' Retirement
        System and is intended for use only during the 2016 Legislative Session.
        I, Richard A. Young, am the Actuary for the  New  York  State  Teachers'
        Retirement  System.  I  am a member of the American Academy of Actuaries
        and I meet the Qualification Standards of the American Academy of  Actu-
        aries to render the actuarial opinion contained herein.