Authorizes John H. Di Veglio, Jr. to apply for service credit for a period of time during which he received long-term disability benefits prior to returning to employment

BILL NUMBER:S5788

Title of bill

An act in relation to authorizing John H. Di Veglio, Jr. to apply for service credit for a period of time during which he received long-term disability benefits prior to returning to his employment with the New York city school construction authority

Purpose or general idea of bill

To allow John H. Di Veglio, Jr. to purchase service credit for the period of time he was on long-term disability leave from the New York City School Construction Authority.

Summary of specific provisions

Section 1. Allows John H. Di Veglio, Jr. to purchase service credit for the period he received long-term disability benefits, beginning in February 2001 through October 3, 2004 He will be able to apply for the service credit with the New York City Board of Education Retirement System (BERS) after he pays the member cost based on the rate of pay as of his last day of employment prior to his date of disability.

Justification

In August 2000, and through no negligence of his own, John H. Di Veglio, suffered a serious workplace injury while employed with the NYC School Construction Authority (SCA), which resulted in his permanent confinement to a wheelchair. After exhausting all Leave balances and living off of Worker's Compensation, he commenced Long Term Disability benefits provided though the NYC Management Benefits Fund in February 2001, He remained on Long Term Disability until October 3, 2004, at which time he returned to full-time employment at the SCA despite the physical challenges posed by his injuries. This bill would allow Mr. Di Veglio, Jr the option to purchase service credit for the period of time he spent on Long Term Disability.

Prior legislative history

New bill

Fiscal implications

With respect to BERS, and assuming Mr. Di Veglio purchases expeditiously the service credits permitted under this proposed legislation, then the enactment of this proposed legislation would result in an increase in the Actuarial Present Value of Benefits ("APVB") by approximately $74,700 as of June 30, 2013.

The member contributions to buy back the prior service would be approximately $17,500 as of June 30, 2013.. After reflecting the member contributions of $17,500 required to buy back the service and the increase in the Actuarial Present Value of Future Normal Costs of approximately $1,300, the net increase in Actuarial Present Value ("APV") of future employer contributions would be approximately $57,200 and the net increase in Unfunded Actuarial Accrued Liability ("UAAL") would be approximately $55,900 as of June 30, 2013.

With respect to BERS, the enactment of the proposed legislation would increase employer costs in each of the first two years that the change is recognized by approximately $33,000. Subsequent to the first two years, the enactment of the proposed legislation would increase annual employer costs each year until his ultimate assumed retirement age of 70 by the increase in the Normal Cost due to the legislation which has been estimated to be approximately $1,000 per year. It is expected that that the SCA would pay the increased employer contributions.

If enacted after June 30, 2013 but prior to finalization of Fiscal Year 2015 employer contributions (I.E. on or before approximately April 2014), increased employer contributions to BERS would begin Fiscal Year 2015 If enacted after the finalization of Fiscal Year 2015 employer contributions, increased employer contributions to BERS would begin Fiscal Year 2016 or later, depending upon the date of enactment.

Effective date

This act shall take effect immediately.