Make Retirement Mandatory for Aides

Section 1. Paragraph (a) of subdivision 7 of section 13-501 of the administrative code of the city of New York, as amended by chapter 650 of the laws of 1990, is amended to read as follows:

(a) "Teacher" shall mean the superintendent of schools, the associate superintendents, the assistant superintendents, the director and the assistant director of the divisions of reference and research, the director and the assistant directors of the bureau of compulsory education, school census and child welfare, attendance teachers and specially certificated attendance officers who are first employed by the New York city board of education on or after September first, nineteen hundred sixty-eight, attendance teachers and specially certificated attendance officers who were members of the New York city board of education retirement system and who, on or before December thirty-first, nineteen hundred sixty-nine, gave notice to said board of education retirement system of their intention to transfer to the New York city teachers' retirement system, the director of attendance, assistant director of attendance, chief attendance officer, division supervising attendance officers and district supervising attendance officers of the bureau of compulsory education, school census and child welfare, supervisors of school social workers who are first employed by the New York city board of education on or after September first, nineteen hundred sixty-nine or who were members of the New York city board of education retirement system and who on or before December thirty-first, nineteen hundred seventy, gave notice to the said board of education retirement system of their intention to transfer to the New York city teachers' retirement system, the members of the board of examiners, the directors and the

EXPLANATION--Matter in italics (underscored) is new; matter in brackets

[ ] is old law to be omitted.

LBD06635-03-9

A. 7874--A 2

assistant directors of special branches, the supervisor and assistant supervisors of lectures, all principals, vice-principals, assistants-toprincipals, heads of departments, and all regular and special teachers of the public day schools of the city, and all employees of the board of education appointed to regular positions in the service of the public schools at annual salaries and whose appointments were made or shall be made from eligible lists prepared as the result of examinations held by the board of examiners or from hiring lists established by the chancellor of the board of education, as the case may be, and all employees employed by the board of education in the titles of teacher aide, educational assistant, educational associate, auxiliary trainer[,] or bilingual professional assistant[, family worker, family assistant, family associate, parent program assistant, who file an application for membership in the retirement association on a form supplied by the retirement board].

§ 2. This act shall take effect immediately.

FISCAL NOTE.--Pursuant to Legislative Law, Section 50:

SUMMARY OF BILL: This proposed legislation would amend paragraph (a)

of subdivision 7 of Section 13-501 of the Administrative Code of the

City of New York to eliminate the requirement that certain titles file

an application to become members of the New York City Teachers' Retire-

ment System (TRS).

Under current law, individuals in the title of teacher aide, educa-

tional assistant, educational associate, auxiliary trainer, bilingual

professional assistant, family worker, family assistant, family associ-

ate, and parent program assistant (collectively, paraprofessionals) have

the option of joining TRS by filing an application for membership.

The proposed legislation would make TRS membership for paraprofession-

als mandatory.

Effective Date: Upon enactment.

FINANCIAL IMPACT - ANNUAL EMPLOYER CONTRIBUTIONS: If enacted into law,

the ultimate employer cost for this proposed legislation would be based

on the number, ages, years of service, and salary of those paraprofes-

sionals that would otherwise not have elected to become members of TRS.

Based on these assumptions and other actuarial assumptions, data, and

methods described herein, the enactment of this proposed legislation

would increase annual employer contributions as follows:

Paraprofessional Estimated First Year

Count Annual Employer

Contribution ($ Millions)

Estimate of Paraprofessionals

who would be mandated into

TRS and otherwise would not

have joined 3,100 $9.0

Estimate of Paraprofessionals

whose membership is being

accelerated into TRS 2,500 6.7

Total 5,600 $15.7

These employer contribution amounts are representative of the annual

employer contribution amounts for each future year if paraprofessional

member participation numbers and demographic characteristics do not

significantly change.

OTHER COSTS: Not measured in this Fiscal Note are the following:

A. 7874--A 3

* The initial, additional administrative costs of TRS and other New

York City agencies to implement the proposed legislation.

* The impact of this proposed legislation on Other Postemployment

Benefit (OPEB) costs.

* The cost of potential Tax-Deferred Annuity (TDA) plan participation

and benefits.

CONTRIBUTION TIMING: For the purposes of this Fiscal Note, it is

assumed that the changes in the annual employer contributions would be

reflected for the first time in the June 30, 2019 actuarial valuation of

TRS. In accordance with the One-Year Lag Methodology (OYLM) used to

determine employer contributions, the increase in employer contributions

would first be reflected in Fiscal Year 2021.

CENSUS DATA: In order to estimate the costs associated with this

group, census data of approximately 5,600 paraprofessionals who are not

currently members of TRS was provided by the United Federation of Teach-

ers and was reviewed. Based on this data and the population of parapro-

fessionals who have already joined TRS, it was estimated that approxi-

mately 3,100 paraprofessionals, who would not have otherwise joined TRS,

would be mandated into TRS membership if this proposed legislation is

enacted. The remaining 2,500 paraprofessionals were assumed to have

become members of TRS at some point in their careers even absent the

proposed legislation.

These paraprofessionals had an average age of approximately 36.8

years, and an average salary of approximately $32,300 as of June 30,

2018.

ACTUARIAL ASSUMPTIONS AND METHODS: The additional employer contrib-

utions presented herein have been calculated based on the same actuarial

assumptions and methods in effect for the June 30, 2018 (Lag) actuarial

valuation used to determine the Preliminary Fiscal Year 2020 employer

contributions of TRS with an additional graded participation rate that

decreases as an individual's years of service increases.

RISK AND UNCERTAINTY: The costs presented in this Fiscal Note depend

highly on the actuarial assumptions and methods used and are subject to

change based on the realization of potential investment, demographic,

contribution, and other risks. If actual experience deviates from actu-

arial assumptions, the actual costs could differ from those presented

herein. Costs are also dependent on the actuarial methods used, and

therefore different actuarial methods could produce different results.

Quantifying these risks is beyond the scope of this Fiscal Note.

STATEMENT OF ACTUARIAL OPINION: I, Sherry S. Chan, am the Chief Actu-

ary for, and independent of, the New York City Retirement Systems and

Pension Funds. I am a Fellow of the Society of Actuaries, an Enrolled

Actuary under the Employee Retirement Income and Security Act of 1974, a

Member of the American Academy of Actuaries, and a Fellow of the Confer-

ence of Consulting Actuaries. I meet the Qualification Standards of the

American Academy of Actuaries to render the actuarial opinion contained

herein. To the best of my knowledge, the results contained herein have

been prepared in accordance with generally accepted actuarial principles

and procedures and with the Actuarial Standards of Practice issued by

the Actuarial Standards Board.

FISCAL NOTE IDENTIFICATION: This Fiscal Note 2019-17 dated May 14,

2019 was prepared by the Chief Actuary for the New York City Teachers'

Retirement System. This estimate is intended for use only during the

2019 Legislative Session.