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History
- Substituted by A8933
- Ordered to third reading cal.705
- Referred to rules
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Relates to rate of regular interest used in the actuarial valuation of liabilities for calculating contributions to the NY city employee's retirement system
Signed by Governor · Sponsor Peter Abbate
Full text
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Sponsor's memo
Title of bill
An act to amend the administrative code of the city of New York, in relation to the rate of regular interest used in the actuarial valuation of liabilities for the purpose of calculating contributions to the New York city employees' retirement system, the New York city teachers' retirement system, the police pension fund, subchapter two, the fire department pension fund, subchapter two and the board of education retirement system of such city by public employers and other obligers required to make employer contributions to such retirement systems, and the crediting of special interest and additional interest to members of such retirement systems, and the allowance of supplementary interest on the funds of such retirement systems
Summary of provisions
This bill would extend for the one-year period ending on June 30, 2010 the current 8% per annum statutory rate of interest used by the Chief Actuary for the New York City Employees' Retirement System, Teachers' Retirement System, Board of Education Retirement System, Police Pension Fund and Fire Department Pension Fund ("City retirement systems") in valuing retirement system liabilities for the purpose of computing the amount of employer contributions to those systems. The bill also would extend for that same period the current rates of supplementary interest, special interest and additional interest which govern the amount of interest to be paid into certain constituent funds of the City retirement systems, and the amount of interest to be credited on accumulated member contributions and increased-take-home-pay reserves of tier 1 and 2 members of those retirement systems. The current valuation rate of interest, as well as the current rates of supplementary, special and additional interest, were enacted by Chapter 152 of the Laws of 2006 for the five-year period ending on June 30, 2009.
Reasons for support
The City pension laws currently provide with respect to the valuation rate of interest that (1) such rate for the period after June 30, 2009 shall be the rate prescribed by an enactment of the State Legislature; and (2) the board of trustees of each of the City retirement systems shall submit to designated New York State and New York City officials, including the Governor, the Mayor and the leaders of the Legislature, its recommendation as to what such rate should be after June 30, 2009. Similar statutory provisions apply with respect to the rates of supplementary interest, special interest and additional interest.
Read the full memo (727 words)
The Chief Actuary of the City retirement systems will be presenting to the retirement system boards of trustees his recommendations for (1) the valuation rate of interest for the five-year period ending on June 30, 2014; and (2) proposed changes in actuarial tables used in calculating employer contributions. Those recommendations are based in part on the Chief Actuary's examination of the actuarial experience and investment experience of the retirement systems, his study of general inflation trends and an experience study prepared by a firm of actuarial consultants. The Actuary has advised the boards of trustees that there will not be sufficient time before the close of the current session of the State Legislature to formulate recommendations, and have those recommendations approved and transmitted to the concerned State and local legislative and executive officials.
Therefore, the City of New York recommends to the Legislature that this bill providing for a one-year extension of the current valuation rate of interest and the accompanying rates of supplementary, special and additional interest be enacted. Such one-year extension would give all concerned officials an opportunity to determine the most suitable rates for a five-year period and arrive at the result which will best serve the retirement systems and the public interest. It should be noted that the Legislature enacted similar one-year extensions of such interest rates for the City retirement systems in 1990, 1995, 2004 and 2005.
Legislative history
See Chapter 878 of the Laws of 1990, Chapter 642 of the Laws of 1995, Chapter 133 of the Laws of 2004 and Chapter 133 of the Laws of 2005.
Fiscal impact
Since this bill would continue the existing valuation rate of interest and the existing rates of special, additional and supplementary interest, its enactment would not result in any cost to the City of New York or other participating employers.
Accordingly, the Mayor urges the earliest possible favorable consideration of this proposal by the Legislature.
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