Allow Rivera Pension Upgrade

Section 1. Notwithstanding the provisions of any general or special law, rule or regulation to the contrary, Mark Rivera who was previously employed by the New York City police department as a police officer and was a Tier 3 member of the Police Pension Fund at the time of his death on March 21, 2015 shall be eligible to apply for membership in Enhanced Tier 3, if within one year from the effective date of this act, Abigail Rivera, the widow of Mark Rivera, shall file with the retirement system an application for membership Enhanced Tier 3 of the Police Pension Fund, and Abigail Rivera may also file for any retirement options or death benefits that would have been available to Mark Rivera if he had been a member of Enhanced Tier 3 on the date of his death. Any amounts paid by the police pension fund to Mark Rivera, his estate or Abigail Rivera prior to the filing of the application for benefits pursuant to this act shall be deducted from the benefit payable thereafter.

§ 2. All costs pursuant to this act shall be borne by the City of New York.

§ 3. This act shall take effect immediately.

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

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

[ ] is old law to be omitted.

LBD03809-04-0

S. 6010--B 2

SUMMARY OF BILL: This proposed legislation would permit Ms. Rivera,

within one year of the effective date, to posthumously elect the Tier 3

Enhanced Plan on behalf of Police Officer Mark Rivera, her deceased

husband, and to apply for any benefits applicable to such Plan.

Effective Date: Upon enactment.

BACKGROUND: Officer Rivera died as a Tier 3 Revised member of the New

York City Police Pension Fund (POLICE) on March 21, 2015. His surviving

spouse, Ms. Rivera, received an ordinary death benefit equal to a lump

sum benefit based on salary and member contributions according to the

provisions of a Tier 3 revised member.

After his death, beginning in September 8, 2016, certain Tier 3

Revised members could elect to join the Tier 3 Enhanced Plan which,

among other things, extended the statutory presumptions contained in the

Heart Bill (General Municipal Law (GML) § 207-k) to Enhanced Plan

members pursuant to Chapter 298 of the Laws of 2016. Tier 3 police offi-

cers became eligible to participate in the Enhanced Plan on April 10,

2017 pursuant to Part SSS of Chapter 59 of the Laws of 2017.

If this legislation is passed, Officer Rivera's death could potential-

ly be deemed as a Line-of-Duty death under such presumption, entitling

his spouse to receive an Accidental Death Benefit pursuant to Retirement

and Social Security Law (RSSL) Section 509 and a Special Accidental

Death Benefit (SADB) under GML Section 208-f, less any amount previously

paid as an ordinary death benefit.

FINANCIAL IMPACT - PRESENT VALUES: The estimated financial impact of

this proposal has been calculated as the difference between the present

value of (1) and (2), where:

(1) is the Accidental Death and SADB benefits Officer Rivera's spouse

would have received if the proposed legislation were enacted (retroac-

tive to the date of death on March 21, 2015, and

(2) is the value of the amount of ordinary death benefits already

paid.

Based on the actuarial assumptions and methods described herein, the

enactment of this proposed legislation would increase the Present Value

of Future Benefits (PVFB) and the Unfunded Accrued Liability (UAL) of

POLICE by approximately $2.3 million. This calculation does not reflect

the offset for a Social Security death benefit, if any, payable to Ms.

Rivera.

FINANCIAL IMPACT - ANNUAL EMPLOYER CONTRIBUTIONS: In accordance with

Administrative Code of the City of New York (ACCNY) Section

13-638.2(k-2), new UAL attributable to benefit changes are to be amor-

tized as determined by the Actuary but generally over the remaining

working lifetime of those impacted by the benefit changes.

For purposes of this Fiscal Note, since Officer Rivera is deceased and

therefore has no remaining working lifetime, the entire increase in UAL

would be recognized immediately.

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

assumed that the changes in the UAL and annual employer contributions

would be reflected for the first time in the June 30, 2020 actuarial

valuation of POLICE. In accordance with the One-Year Lag Methodology

(OYLM) used to determine employer contributions, the increase in employ-

er contributions would be reflected in Fiscal Year 2022.

CENSUS DATA: As of June 30, 2019, Ms. Rivera was approximately age 41

and is not receiving an annual pension. Additional data was provided by

POLICE which was not audited but was checked for reasonableness. Below

is a summary of the data provided:

*Ordinary Death Benefit Lump Sum: $167,000

S. 6010--B 3

*Accidental Death Annual Benefit (City): $25,343

*SADB Annual Benefit at Date of Death (State): $58,854

ACTUARIAL ASSUMPTIONS AND METHODS: The changes in the PVFB presented

herein have been calculated based on the actuarial assumptions and meth-

ods in effect for the June 30, 2018 (Lag) actuarial valuations used to

determine the Preliminary Fiscal Year 2020 employer contributions of

POLICE.

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

highly on the realization of the actuarial assumptions used, as well as

certain demographic characteristics of the Plan and other exogenous

factors such as investment, contribution, and other risks. If actual

experience deviates from actuarial 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.

Not measured in this Fiscal Note are the following:

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

York City agencies to implement the proposed legislation.

* The impact of this proposed legislation on Other Postemployment

Benefit (OPEB) costs.

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 2020-04 dated February 6,

2020 was prepared by the Chief Actuary for the New York City Police

Pension Fund. This estimate is intended for use only during the 2020

Legislative Session.