Relates to certain members who re-enter public service

Summary of provisions

This bill amends subdivisions 2 and 4 of section 645 of the retirement and social security law.

Justification

This bill gives New York State the opportunity to correct a long-stand- ing inequity at a moderate cost. In 1998, the Governor signed a law reinstating New York State and City active teachers to their original pension system tier membership. In 1999, pursuant to 55944, the Governor signed a law expanding the reinstatement to all active public employees. In the Governor's press release, he affirmed the importance of righting the inequity done to thousands of public employees who were forced opt of their jobs and pension plan due to pregnancy and family care giving responsibilities. Each member who was reinstated forfeited any claim to a return of the contributions they had made to the retirement systems while they were members of lesser tiers. However, reinstated members were. refunded the amounts that they had paid to the retirements systems for prior service credit purchases. This bill pertains to a very limit- ed and definable number of retirement system members. Public employees before 1973 were assured by pension system representatives that they could leave and return to work without effect on their benefits. For example, a New York State teacher who left teaching, generally for reasons related to the female work pattern i.e. childbirth and attending to small children, stayed out beyond the "break in service" period, and returned to find themselves in a lesser pension plan. Had they been properly informed, they could have taught as little as twenty days in anyone year within the five year period and remained in Tier I when they returned to full time teaching. The average teacher lost between $9,000 and $1,000 per year in pension benefits and the right to retire at age 55 instead of 52 without penalty. It is unlikely that any members of the police and fire pension systems will be eligible because so few women were members in the 1960s and early 70s. As to the New York City Teach- ers pension plan, the vast majority of teachers that left for care giving responsibilities were protected by the generous New York City maternity rules.

Legislative history

2009/10 A.7219 Died Gov't Employees, S.3634 Died Civil Service 2007/08 A.9524 Died Gov't Employees, S.4447 Passed Senate 2005/06 A.5131 Died Gov't Employees, S.3518 Passed Senate 2003/04 A.5392 Died Gov't Employees, S.3039 Died Rules 2001/02 A.2903 Died Gov't Employees, S.2172 Died Civil Service & Pensions 1999/00 A.10911 Died Gov't Employees, S.6127 Died Civil Service & Pensions

Fiscal implications

FISCAL NOTE #2012-143 - PURSUANT TO LEGISLATIVE LAW, SECTION 50: This bill would allow certain living retirees of New York public retirement systems who retired prior to December 16, 1999 and who previously were members of a New York Public retirement system to be deemed to have become members of the systems from which they retired as of the original date of such previous ceased membership. Tier 3 and 4 retirees of the New York State and Local Employees' Retirement System or the New York State Teachers' Retirement System who become Tier I or 2 retirees and who have already purchased their previous service would receive a refund of these contributions. No benefits will be deemed to have accrued prior to the effective date of this act.

If this bill is enacted, insofar as this bill affects the New York State and Local Employees' Retirement System (NYS&LERS), approximately 1,484 retirees of the NYS&LERS will be affected. The estimated additional annual increase in contributions would be approximately $15.9 million. This cost will be shared by the State of New York and all participating employers in the NYS&LERS.

Insofar as this bill would affect employers in the New York State and Local Police and Fire Retirement System (NYS&LPERS), the estimated additional costs would be negligible.

In addition there will be cost for retirees who had a previous ceased membership with a public employee retirement system other than the NYS&LERS or the NYS&LPFRS. These costs would depend upon the number of retirees affected and upon each retiree's age, salary, credited service, plan coverage and tier. The number of retirees with such previous ceased membership with another public retirement system cannot be readily determined. These additional costs would be shared by the State of New York and all participating employers in their respective systems.

This estimate, dated May 24, 2012 and intended for use only during the, 2012 Legislative Session is Fiscal Note No. 2012-143, prepared by the Actuary for the NYS&LERS and the NYS&LPFRS.

Fiscal note - pursuant to legislative law, section 50

This bill would amend subdivisions 2 and 4 of section 645 of the Retirement and Social.

Security Law to extend the tier reinstatement provisions to any retiree of a public retirement system. The retiree must be alive as of the effective date of the bill in order to be eligible; This bill only applies to payments made on or after the effective date of this act.

The annual cost to the employers of members of the New York State Teachers' Retirement System for this benefit is estimated to be $7.0 million or .0515 of payroll if this bill is enacted.

The source of this estimate is Fiscal Note 2011-42 dated May 4, 2011 prepared by the Actuary of the New York State Teachers' Retirement System and is intended for use only during the 2011 legislative session.

Effective date

This act shall take effect immediately but shall only apply to persons alive as of the effective date of this act and shall Apply to payments made on or after the effective date of this act; and provided further, that any retirees qualifying under this act shall have their retirement allowance recalculated from July 1, 2012 or the date of reinstatement, whichever is later.