What's happening
This bill changes how retirement loan balances affect survivor and retirement benefits, basing reductions on amortization schedules set by the comptroller.
Why it matters
Shifts benefit reduction calculations from a static “actuarial equivalent” to a dynamic amortization schedule,. meaning reductions in survivor and retirement benefits will now be more closely tied to the actual loan balance, interest rate, and estimated benefit duration at the time of repayment, potentially making reductions more precise and individualized.
Gives the comptroller explicit authority and responsibility. to set and update the amortization schedules and actuarial methods used to determine how outstanding retirement loans impact benefits, possibly leading to more regular adjustments in line with economic and demographic changes.
May impact members differently based on timing and repayment progress,. as reductions to benefits will continue only until the loan (with interest) is considered repaid under the new schedule, potentially reducing the long-term impact for those who pay down loans faster or take smaller loans.
Could affect survivor benefits more transparently and predictably,. as survivors will see benefit reductions calculated using the same updated, standardized schedules, possibly making it easier to understand and plan for the impact of outstanding retirement loans in estate and survivor planning.
Albany, before your first meeting.
Every bill that moved yesterday, summarized in a sentence and ranked by impact. The Albany Scorecard follows on Sundays.
Free. Unsubscribe in one click. Want alerts on specific bills? Create an account.
Who cares
Headline styles
Change Retirement Loan Deductions
Plain English, a few words. Used as the page title.
Sponsors
History
- Held for consideration in governmental employees
- Referred to governmental employees
- Referred to governmental employees
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
2068
2017-2018 Regular Sessions
IN ASSEMBLY
January 17, 2017
Introduced by M. of A. MONTESANO, RAIA, PALUMBO, FINCH, DiPIETRO -- Multi-Sponsored by -- M. of A. ARROYO, CROUCH, GIGLIO, PALMESANO, RA -- read once and referred to the Committee on Governmental Employees
AN ACT to amend the retirement and social security law, in relation to the management of retirement loans
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Subdivisions e and f of section 50 of the retirement and social security law, subdivision e as amended by chapter 705 of the laws of 1964, are amended to read as follows:
e. The borrowing member's [anuuity] annuity savings account shall not be reduced by the loan obtained but a subsidiary record shall be maintained reflecting the outstanding balance on such loan, as well as the allocation of the payroll deductions to principal and interest. Upon the member's withdrawal of his accumulated contributions or retirement, the balance due on his loan shall be deducted from the amount to his credit at such time in the annuity savings fund. Upon the death of the member [prior to the loan being fully insured, that portion thereof which is uninsured, shall similarly be deducted from the amount to his credit at the time of his death in the annuity savings fund] the corresponding survivor's benefit will be decreased in an amount prescribed by the comptroller based upon an amortization schedule calculated using the amount of principal outstanding, interest rate and estimated length of benefit payment as prescribed by actuarial techniques prescribed by the comptroller, until such time that all outstanding principal and interest amounts have been satisfactorily repaid.
f. In the case of any benefit wherein the amount of pension will be determined, in part, by the amount of annuity, such annuity shall be computed upon the basis of accumulated contributions as if there were no loan or no additional contributions. The resulting retirement allowance shall then be reduced by [the actuarial equivalent of the present value
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD06077-01-7
A. 2068 2
of any oustanding loan] an amount prescribed by the comptroller based upon an amortization schedule calculated using the amount of principal outstanding, interest rate and estimated length of benefit payment as prescribed by actuarial techniques prescribed by the comptroller, until such time that all outstanding principal and interest amounts have been satisfactorily repaid.
§ 2. This act shall take effect immediately.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.