STATE OF NEW YORK ________________________________________________________________________ 10352 IN ASSEMBLY April 16, 2018 ___________ Introduced by M. of A. ABBATE -- read once and referred to the Committee on Governmental Employees AN ACT to amend the retirement and social security law, the education law and the administrative code of the city of New York, in relation to providing cost-of-living adjustments The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Subdivision f of section 78-a of the retirement and social 2 security law, as added by chapter 125 of the laws of 2000, is amended to 3 read as follows: 4 f. Commencing September first, two thousand, all retired members who 5 have retired prior to the calendar year nineteen hundred ninety-seven 6 and who meet the eligibility criteria set forth in subdivision a of this 7 section shall be paid an adjusted benefit in monthly installments on the 8 basis provided for in this subdivision. Said adjusted benefit shall be 9 equal to a percentage of the change in consumer price index (all urban 10 consumers, CPI-U, U.S. city average, all items, 1982-84=100), published 11 by the United States bureau of labor statistics, measured from the year 12 of retirement through calendar year nineteen hundred ninety-seven 13 according to the following schedule: 14 Year of retirement Percentage 15 1968 through 1996 50% 16 1966 and 1967 55% 17 1965 60% 18 1964 65% 19 1963 70% 20 1962 80% 21 1961 90% 22 prior to 1961 100% 23 Said adjusted benefit shall be computed on a base benefit amount not to 24 exceed eighteen thousand dollars of the retirement allowance otherwise 25 payable, computed without optional modification. Any benefit received EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD11292-06-8A. 10352 2 1 pursuant to this subdivision shall be in lieu of any benefit received 2 pursuant to section seventy-eight of this title. 3 Commencing September first, two thousand eighteen, all retired members 4 who have retired prior to the calendar year nineteen hundred ninety-sev- 5 en and who meet the eligibility criteria set forth in subdivision a of 6 this section shall be paid an adjusted benefit in monthly installments 7 on the basis provided for in this subdivision. Said adjusted benefit 8 shall be equal to a percentage of the change in consumer price index 9 (all urban consumers, CPI-U, U.S. city average, all items, 1982-84=100), 10 published by the United States bureau of labor statistics, measured from 11 the year of retirement through calendar year nineteen hundred ninety- 12 seven according to the following schedule: 13 Year of retirement Percentage 14 1973 through 1996 50% 15 1971 and 1972 55% 16 1970 60% 17 1969 65% 18 1968 70% 19 1967 80% 20 1966 90% 21 prior to 1966 100% 22 Said adjusted benefit commencing September first, two thousand eighteen, 23 shall be computed on the base benefit amount of the retirement allowance 24 otherwise payable, computed without optional modification, set forth 25 herein above. Any benefit received pursuant to this subdivision shall be 26 in lieu of any benefit received pursuant to section seventy-eight of 27 this title. 28 § 2. Subdivision f of section 378-a of the retirement and social secu- 29 rity law, as added by chapter 125 of the laws of 2000, is amended to 30 read as follows: 31 f. Commencing September first, two thousand, all retired members who 32 have retired prior to the calendar year nineteen hundred ninety-seven 33 and who meet the eligibility criteria set forth in subdivision a of this 34 section shall be paid an adjusted benefit in monthly installments on the 35 basis provided for in this subdivision. Said adjusted benefit shall be 36 equal to a percentage of the change in consumer price index (all urban 37 consumers, CPI-U, U.S. city average, all items, 1982-84=100), published 38 by the United States bureau of labor statistics, measured from the year 39 of retirement through calendar year nineteen hundred ninety-seven 40 according to the following schedule: 41 Year of retirement Percentage 42 1968 through 1996 50% 43 1966 and 1967 55% 44 1965 60% 45 1964 65% 46 1963 70% 47 1962 80% 48 1961 90% 49 prior to 1961 100% 50 Said adjusted benefit shall be computed on a base benefit amount not to 51 exceed eighteen thousand dollars of the retirement allowance otherwise 52 payable, computed without optional modification. Any benefit received 53 pursuant to this subdivision shall be in lieu of any benefit received 54 pursuant to section three hundred seventy-eight of this title.A. 10352 3 1 Commencing September first, two thousand eighteen, all retired members 2 who have retired prior to the calendar year nineteen hundred ninety-sev- 3 en and who meet the eligibility criteria set forth in subdivision a of 4 this section shall be paid an adjusted benefit in monthly installments 5 on the basis provided for in this subdivision. Said adjusted benefit 6 shall be equal to a percentage of the change in consumer price index 7 (all urban consumers, CPI-U, U.S. city average, all items, 1982-84=100), 8 published by the United States bureau of labor statistics, measured from 9 the year of retirement through calendar year nineteen hundred ninety- 10 seven according to the following schedule: 11 Year of retirement Percentage 12 1973 through 1996 50% 13 1971 and 1972 55% 14 1970 60% 15 1969 65% 16 1968 70% 17 1967 80% 18 1966 90% 19 prior to 1966 100% 20 Said adjusted benefit commencing September first, two thousand eighteen, 21 shall be computed on the base benefit amount of the retirement allowance 22 otherwise payable, computed without optional modification, set forth 23 herein above. Any benefit received pursuant to this subdivision shall be 24 in lieu of any benefit received pursuant to section three hundred seven- 25 ty-eight of this title. 26 § 3. Subdivision f of section 532-a of the education law, as added by 27 chapter 125 of the laws of 2000, is amended to read as follows: 28 f. Commencing September first, two thousand, all retired members who 29 have retired prior to the calendar year nineteen hundred ninety-seven 30 and who meet the eligibility criteria set forth in subdivision a of this 31 section shall be paid an adjusted benefit in monthly installments on the 32 basis provided for in this subdivision. Said adjusted benefit shall be 33 equal to a percentage of the change in consumer price index (all urban 34 consumers, CPI-U, U.S. city average, all items, 1982-84=100), published 35 by the United States bureau of labor statistics, measured from the year 36 of retirement through calendar year nineteen hundred ninety-seven 37 according to the following schedule: 38 Year of retirement Percentage 39 1968 through 1996 50% 40 1966 and 1967 55% 41 1965 60% 42 1964 65% 43 1963 70% 44 1962 80% 45 1961 90% 46 prior to 1961 100% 47 Said adjusted benefit shall be computed on a base benefit amount not to 48 exceed eighteen thousand dollars of the retirement allowance otherwise 49 payable, computed without optional modification excluding any annuity 50 derived from voluntary contributions made by members, except those made 51 pursuant to elections under subdivision one of section five hundred 52 eleven-a or paragraph c of subdivision three of section five hundred 53 sixteen of this article. Any benefits received pursuant to this subdivi- 54 sion shall be in lieu of any benefits received pursuant to section five 55 hundred thirty-two of this article, unless such benefits are in excessA. 10352 4 1 of those provided by this section, in which case such benefits shall be 2 paid by the retirement system pursuant to such provision. 3 Commencing September first, two thousand eighteen, all retired members 4 who have retired prior to the calendar year nineteen hundred ninety-sev- 5 en and who meet the eligibility criteria set forth in subdivision a of 6 this section shall be paid an adjusted benefit in monthly installments 7 on the basis provided for in this subdivision. Said adjusted benefit 8 shall be equal to a percentage of the change in consumer price index 9 (all urban consumers, CPI-U, U.S. city average, all items, 1982-84=100), 10 published by the United States bureau of labor statistics, measured from 11 the year of retirement through calendar year nineteen hundred ninety- 12 seven according to the following schedule: 13 Year of retirement Percentage 14 1973 through 1996 50% 15 1971 and 1972 55% 16 1970 60% 17 1969 65% 18 1968 70% 19 1967 80% 20 1966 90% 21 prior to 1966 100% 22 Said adjusted benefit, commencing September first, two thousand eigh- 23 teen, shall be computed on the base benefit amount of the retirement 24 allowance otherwise payable, computed without optional modification, set 25 forth herein above. Any benefit received pursuant to this subdivision 26 shall be in lieu of any benefit received pursuant to section five 27 hundred thirty-two of this article. 28 § 4. Subdivision f of section 13-696 of the administrative code of the 29 city of New York, as added by chapter 125 of the laws of 2000, is 30 amended to read as follows: 31 f. Commencing September first, two thousand, all retired members who 32 have retired prior to the calendar year nineteen hundred ninety-seven 33 and who meet the eligibility criteria set forth in subdivision a of this 34 section shall be paid an adjusted benefit in monthly installments on the 35 basis provided for in this subdivision. Said adjusted benefit shall be 36 equal to a percentage of the change in consumer price index (all urban 37 consumers, CPI-U, U.S. city average, all items, 1982-84=100), published 38 by the United States bureau of labor statistics, measured from the year 39 of retirement through calendar year nineteen hundred ninety-seven 40 according to the following schedule: 41 Year of retirement Percentage 42 1968 through 1996 50% 43 1966 and 1967 55% 44 1965 60% 45 1964 65% 46 1963 70% 47 1962 80% 48 1961 90% 49 prior to 1961 100% 50 Said adjusted benefit shall be computed on a base benefit amount not to 51 exceed eighteen thousand dollars of the annual fixed retirement allow- 52 ance otherwise payable, computed without optional modification. Any 53 benefit received pursuant to this subdivision shall be in lieu of any 54 benefit received pursuant to chapter three hundred ninety of the laws ofA. 10352 5 1 nineteen hundred ninety-eight, and any preceding provision of law 2 providing for supplementation. 3 Commencing September first, two thousand eighteen, all retired members 4 who have retired prior to the calendar year nineteen hundred ninety-sev- 5 en and who meet the eligibility criteria set forth in subdivision a of 6 this section shall be paid an adjusted benefit in monthly installments 7 on the basis provided for in this subdivision. Said adjusted benefit 8 shall be equal to a percentage of the change in consumer price index 9 (all urban consumers, CPI-U, U.S. city average, all items, 1982-84=100), 10 published by the United States bureau of labor statistics, measured from 11 the year of retirement through calendar year nineteen hundred ninety- 12 seven according to the following schedule: 13 Year of retirement Percentage 14 1973 through 1996 50% 15 1971 and 1972 55% 16 1970 60% 17 1969 65% 18 1968 70% 19 1967 80% 20 1966 90% 21 prior to 1966 100% 22 Said adjusted benefit, commencing September first, two thousand eigh- 23 teen, shall be computed on the base benefit amount of the retirement 24 allowance otherwise payable, computed without optional modification, set 25 forth herein above. Any benefit received pursuant to this subdivision 26 shall be in lieu of any benefit received pursuant to section 13-695 of 27 this article. 28 § 5. This act shall take effect immediately. FISCAL NOTE.--Pursuant to Legislative Law, Section 50: This bill would provide an increase in the defined benefit cost-of- living adjustment (COLA) for New York public retirement systems. Start- ing with a payment in September 2018, additional payments will be made for those members who retired after 1960 and prior to 1973. Insofar as this bill affects the New York State and Local Employees' Retirement System, pursuant to Section 25 of the Retirement and Social Security Law, the increased costs would be borne entirely by the State of New York and would require an itemized appropriation sufficient to pay the cost of the provision. If this bill were enacted, the increase in the present value of benefits would be approximately $483,000. Insofar as this bill affects the New York State and Local Police and Fire Retirement System (PFRS), the increased costs would be shared by the State of New York and the participating employers in the PFRS. If this bill were enacted, the increase in the present value of benefits would be approximately $1.09 million. The estimated first year cost would be approximately $25,600 to the State of New York and approximate- ly $105,000 to the participating employers in the PFRS. 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, 2017 actuarial valu- ation. Distributions and other statistics can be found in the 2017 Report of the Actuary and the 2017 Comprehensive Annual Financial Report. The actuarial assumptions and methods used are described in the 2015, 2016, and 2017 Annual Report to the Comptroller on Actuarial Assump- tions, and the Codes Rules and Regulations of the State of New York: Audit and Control.A. 10352 6 The Market Assets and GASB Disclosures are found in the March 31, 2017 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 January 25, 2018, and intended for use only during the 2018 Legislative Session, is Fiscal Note No. 2018-38, 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 subdivision f of Section 532-a of the Education Law to provide an increase in supplementation for retired members who meet the eligibility requirements set forth in subdivision a of Section 532-a and who retired during the calendar years 1961 through 1972, inclusive. Benefit increases are based on the first $18,000 of the maxi- mum annual benefit without optional modification and would be effective in September 2018. 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. Member 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 2018-14 dated March 20, 2018 prepared by the Actuary of the New York State Teachers' Retirement System and is intended for use only during the 2018 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.