S08126 Summary:

BILL NOS08126
 
SAME ASSAME AS A10204-A
 
SPONSORHARCKHAM
 
COSPNSRHOYLMAN, KRUEGER, METZGER
 
MLTSPNSR
 
Amd 212, R & SS L
 
Relates to the retiree earnings cap for health care officials and workers during a declared public health related state of emergency declared by the governor.
Go to top    

S08126 Actions:

BILL NOS08126
 
03/23/2020REFERRED TO CIVIL SERVICE AND PENSIONS
Go to top

S08126 Committee Votes:

Go to top

S08126 Floor Votes:

There are no votes for this bill in this legislative session.
Go to top

S08126 Memo:

Memo not available
Go to top

S08126 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          8126
 
                    IN SENATE
 
                                     March 23, 2020
                                       ___________
 
        Introduced  by Sen. HARCKHAM -- 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
          the  retiree earnings cap for health care officials and workers during
          a declared public health related state of emergency

          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
 
     1    Section  1.  Section  212 of the retirement and social security law is
     2  amended by adding a new subdivision 4 to read as follows:
     3    4. Notwithstanding the earning limitations  for  retired  persons  set
     4  forth  in  this  section,  state  and local governments may hire retired
     5  public health officials and workers at any reasonable earning  level  in
     6  times of a declared public health related state of emergency declared by
     7  the  governor,  provided  that  such retirees hired during such state of
     8  emergency are hired and continue to  be  employed  for  the  purpose  of
     9  combatting COVID-19.
    10    § 2. This act shall take effect immediately.
          FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
          This  bill  would  exempt  from  the earnings limitations set forth in
        Section 212 of the Retirement and Social Security Law (RSSL) any retired
        public health officials and workers rehired at  any  reasonable  earning
        level  in  times  of a declared public health related state of emergency
        declared by the Governor, provided that such retirees hired during  such
        state of emergency are hired and continue to be employed for the purpose
        of combatting COVID-19.
          Insofar  as  this bill affects the New York State and Local Retirement
        System (NYSLRS), if this legislation is enacted during the 2020 legisla-
        tive session, we expect there  would  be  negligible  additional  annual
        costs.    However, if large numbers of retirees are hired into positions
        with lucrative earning levels over long periods of time, there could  be
        additional  annual  costs which would be shared by the state of New York
        and all of the participating employers in the NYSLRS.
          Summary of relevant resources:
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD15822-05-0

        S. 8126                             2
 
          The membership data used in  measuring  the  impact  of  the  proposed
        change  was  the same as that used in the March 31, 2019 actuarial valu-
        ation.  Distributions and other statistics can  be  found  in  the  2019
        Report  of  the  Actuary  and  the  2019  Comprehensive Annual Financial
        Report.
          The  actuarial assumptions and methods used are described in the 2015,
        2016, 2017, 2018, and 2019 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, 2019
        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 fiscal note does not constitute a legal opinion on the  viability
        of  the  proposed change nor is it intended to serve as a substitute for
        the professional judgment of an attorney.
          This estimate, dated March 16, 2020, and intended for use only  during
        the  2020  Legislative  Session, is Fiscal Note No. 2020-98, prepared by
        the Actuary for the New York State and Local Retirement System.
          FISCAL NOTE.--Pursuant to Legislative Law, Section 50:
          SUMMARY OF BILL: This proposed legislation, as it relates to  the  New
        York  City  Pension  Funds  and  Retirement Systems (NYCRS), would amend
        Retirement and Social Security Law (RSSL)  Section  212  to  remove  the
        earnings limit of certain NYCRS retirees who have returned to employment
        in Public Service during a declared public health related state of emer-
        gency.
          Effective Date: Upon enactment.
          IMPACT  ON PENSION PAYMENTS: Retirees who return to Public Service and
        elect to be covered under the provisions of RSSL Section 212 are permit-
        ted to earn an amount not exceeding a specific dollar limit in a  calen-
        dar  year  without  loss,  suspension, or diminution of their retirement
        allowances. Once this dollar limit is reached, the retiree's pension  is
        suspended  for the remainder of that calendar year. Generally, there are
        no earnings limitations in, or following, the calendar year in which the
        retiree attains age 65.
          Currently, the dollar limitation in effect for Calendar Year 2020  and
        thereafter is $35,000.
          Under the proposed legislation, if enacted, the RSSL Section 212 post-
        retirement  Public  Service  earnings  limitation  would  be removed for
        retired health care workers hired during a declared public heath related
        state of emergency who are hired for  the  purpose  of  combatting  such
        public health crises.
          For illustrative purposes only, the table below presents the estimated
        additional  retirement  allowances paid if RSSL Section 212 post-retire-
        ment earnings limitation were removed for various sample combinations of
        post-retirement annual earnings and annual retirement allowance  amounts
        for  those retirees who are currently employed in post-retirement public
        employment and are subject to post-retirement earnings limits.
 
        Annual Retirement        Annual Post-Retirement Earnings in Calendar Year
        Allowance                     $40,000        $50,000        $60,000
        $30,000                       $3,800          $9,000        $12,500
        $40,000                       $5,000         $12,000        $16,700
        $50,000                       $6,300         $15,000        $20,800

        S. 8126                             3
 
        $60,000                       $7,500         $18,000        $25,000
        $70,000                       $8,800         $21,000        $29,200
 
          FINANCIAL  IMPACT  - ANNUAL 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 attributable to benefit  changes
        are  to  be  amortized  as  determined by the Actuary, but are generally
        amortized over the remaining working lifetime of those impacted  by  the
        benefit  changes.  However,  since  changes in the applicable retirement
        allowances paid to NYCRS retirees under this  proposed  legislation  are
        not  known  in  advance,  the  increase  in pension payments due to this
        legislation would be treated as an actuarial loss. These actuarial loss-
        es would be amortized over a 15-year period (14 payments under the  One-
        Year Lag Methodology (OYLM)) using level dollar payments.
          The number of NYCRS retirees who could potentially be impacted by this
        proposed  legislation  cannot  be readily determined. Actual costs would
        depend on factors such as, but not limited to, the  number  of  retirees
        that  benefit under the legislation and the amount of their earnings and
        retirement allowances.
          Note, however, that  to  the  extent  that  the  proposed  legislation
        results  in  the  rehiring  of  retirees  who  would  not have otherwise
        returned to post-employment public service absent the  legislation,  the
        legislation is anticipated to create no additional pension cost, and may
        mitigate  cost that would have been realized from additional pensionable
        wages paid to existing NYCRS members and/or additional new hires.
          CONTRIBUTION TIMING: For the purposes  of  this  Fiscal  Note,  it  is
        assumed  that  the changes in the annual employer contributions would be
        reflected for the first time in the June 30, 2020  actuarial  valuations
        of  the  NYCRS.  In  accordance with the OYLM used to determine employer
        contributions, the increase in employer  contributions  would  first  be
        reflected in Fiscal Year 2022.
          CENSUS  DATA:  For  purposes  of  analyzing the impact of the proposed
        legislation, illustrative examples with various  salary  and  retirement
        allowance amounts have been provided above.
          ACTUARIAL  ASSUMPTIONS AND METHODS: The changes in the annual employer
        contributions presented herein have been calculated based on the actuar-
        ial assumptions and methods in effect for the June 30, 2019 (Lag)  actu-
        arial  valuations  used  to  determine  the Preliminary Fiscal Year 2021
        employer contributions of NYCRS.
          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 NYCRS 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  meth-
        ods  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 NYCRS 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

        S. 8126                             4

        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 2020-13 dated  March  16,
        2020  was prepared by the Chief Actuary for the New York City Retirement
        Systems and Pension Funds. This estimate is intended for use only during
        the 2020 Legislative Session.
Go to top