STATE OF NEW YORK
________________________________________________________________________
10712
IN ASSEMBLY
July 1, 2020
___________
Introduced by COMMITTEE ON RULES -- (at request of 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 certain lung disabilities incurred by members of the New
York city transit authority in certain cases
The People of the State of New York, represented in Senate and Assem-
bly, do enact as follows:
1 Section 1. The administrative code of the city of New York is amended
2 by adding a new section 13-168.1 to read as follows:
3 § 13-168.1 Transit authority members; presumption in certain diseases.
4 Notwithstanding any provision of this chapter or of any general, special
5 or local law to the contrary, and for the purposes of this chapter, any
6 condition of impairment of health caused by diseases of the lung,
7 resulting in total or partial disability or death to a member of the New
8 York city transit authority, or a member of its subsidiary corporation,
9 as defined in section twelve hundred three-a of the public authorities
10 law, where such member successfully passed a physical examination on
11 entry into such service or subsequent thereto, which examination failed
12 to reveal any evidence of such condition, shall be presumptive evidence
13 that it was incurred in the performance and discharge of duty.
14 § 2. This act shall take effect immediately.
FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
SUMMARY OF BILL: This proposed legislation would amend the Administra-
tive Code of the City of New York (ACCNY) to add a new Section 13-168.1
to provide a statutory presumption to Tier 1 and Tier 2 members of the
New York City Employees' Retirement System (NYCERS) who are Transit
Authority employees, and who become physically incapacitated for
performance of duty, or die, due to lung disease.
In determining whether qualifying lung disease was caused by employ-
ment for the Transit Authority, the diagnosis of lung disease, absent
evidence of such condition upon examination at hire, would be presump-
tive evidence that such disability or death was incurred in the perform-
ance and discharge of duty. The proposed legislation does not provide a
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD03331-04-0
A. 10712 2
mechanism for rebutting such presumption with competent evidence to the
contrary.
Effective Date: Upon enactment.
FINANCIAL IMPACT - OVERVIEW: There is no data available to estimate
the number of members who might develop and become disabled by or die
from lung disease, and potentially benefit from this proposed legis-
lation. Therefore, the estimated financial impact has been calculated
on a per event basis equal to the increase in the Present Value of
Future Benefits (PVFB) for an average affected member who is diagnosed
with lung disease as the result of the enactment of the proposed legis-
lation and who would benefit from the proposed legislation.
In determining the increase in the PVFB, it has been assumed that 100%
of the members who would retire with lung disease would have continued
working and eventually retired for service if the proposed legislation
were not passed. The increase in PVFB does not include any cost for
additional death benefits since the ordinary death benefit for these
members is more valuable than the accidental death benefit in most
cases.
With respect to an individual member, the additional cost of this
proposed legislation varies greatly.
FINANCIAL IMPACT - PRESENT VALUES: Based on the census data and the
actuarial assumptions and methods described herein, the enactment of
this proposed legislation would increase the PVFB by an amount ranging
from $6,700 to $131,100 if one of the 12 members who could benefit from
the proposed legislation develops a qualifying lung disease. The average
increase in PVFB for the 12 members who could benefit from the proposed
legislation is approximately $60,100.
FINANCIAL IMPACT - ANNUAL EMPLOYER CONTRIBUTIONS: Enactment of this
proposed legislation would increase employer contributions, where such
amount would depend on the number of members affected as well as other
characteristics including the age, years of service, and salary history
of each member.
As there is no data currently available to estimate the number of
members who might be diagnosed with disabling lung disease, the finan-
cial impact would be recognized at the time of event. Consequently,
changes in employer contributions have been estimated assuming that the
increase in the PVFB will be financed over the same time period used for
actuarial losses in accordance with Section 13-638.2(k-2) of the ACCNY.
Using this approach, the additional PVFB would be amortized over a
closed 15-year period (14 payments under the One-Year Lag Methodology)
using level dollar payments.
Based on the Actuary's actuarial assumptions and methods in effect as
of June 30, 2019, the enactment of this proposed legislation is esti-
mated to increase annual employer contributions by an amount ranging
from $800 to $15,500 if one of the 12 members who could benefit from the
proposed legislation develops a qualifying lung disease. The average
increase in annual employer contributions for the 12 members who could
benefit from the proposed legislation is approximately $7,100. With
respect to the timing, increases in employer contributions would depend
upon when members would retire due to lung disease but, generally,
increased employer contributions will first occur the second fiscal year
following approval of the accident disability retirement.
CENSUS DATA: The estimates presented herein are based on the census
data used in the Preliminary June 30, 2019 (Lag) actuarial valuation of
NYCERS to determine the Preliminary Fiscal Year 2021 employer contrib-
utions.
A. 10712 3
There are 12 active Tier 1 and Tier 2 Transit Authority employees who
participate in NYCERS as of June 30, 2019 who could potentially benefit
from the proposed legislation. These 12 active Tier 1 and Tier 2 Transit
Authority members had an average age of approximately 71.6 years, aver-
age service of approximately 38.1 years, and an average salary of
approximately $93,600. This group consisted of eight Tier 1 members, and
four Tier 2 members.
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 June 30, 2019
(Lag) actuarial valuations used to determine the Preliminary Fiscal Year
2021 employer contributions of NYCERS.
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 following:
* The initial, additional administrative costs of NYCERS 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, Sherry S. Chan, am the Chief Actu-
ary for, and independent of, the New York City Retirement Systems and
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 2020-32 dated April 28,
2020 was prepared by the Chief Actuary for the New York City Employees'
Retirement System. This estimate is intended for use only during the
2020 Legislative Session.