Presume Parkinson's for Firefighters

Section 1. The retirement and social security law is amended by adding a new section 363-ff to read as follows:

§ 363-ff. Firefighter certain impairments of health; presumption. Notwithstanding any other provisions of this chapter to the contrary, any condition of impairment of health caused by Parkinson's Disease, resulting in total or partial disability or death to a paid firefighter, who successfully passed a physical examination on entry into firefighter service, which examination failed to reveal any evidence of such condition, shall be presumptive evidence that, unless the contrary be proven by competent evidence, such disability or death (a) was caused by the natural and proximate result of an accident, not caused by such firefighter's own willful negligence, and (b) was sustained in the performance and discharge of duty.

§ 2. The general municipal law is amended by adding a new section 207-kkk to read as follows:

§ 207-kkk. Disabilities of firefighters in certain cities caused by Parkinson's Disease. Notwithstanding any other provisions of this chapter to the contrary, any condition of impairment of health caused by Parkinson's Disease resulting in total or partial disability or death to a paid member of a fire department in a city with a population of one million or more, or any retired member of such department who has been retired for two or less years, who successfully passed a physical examination on entry into the service of such department, which examination failed to reveal any evidence of such condition, shall be presumptive

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

[ ] is old law to be omitted.

LBD14993-03-0

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evidence that it was incurred in the performance and discharge of duty unless the contrary be proved by competent evidence.

§ 3. The board of trustees of the New York city fire department pension fund shall take appropriate administrative action to implement the intent of section two of this act.

§ 4. This act shall take effect immediately.

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

This bill would amend both the General Municipal Law and the Retire-

ment and Social Security Law to provide firefighters with a presumption

that any disability or death resulting from impairments of health

related to Parkinson's Disease are the result of an accident sustained

in the performance of duty, unless the contrary can be proven by compe-

tent evidence.

Insofar as it will affect the New York State and Local Police and Fire

Retirement System (PFRS), if this bill is enacted it would lead to more

disabilities and deaths being classified as "accidental". The cost of

the revised benefit will depend upon the applicant's age, service, sala-

ry, plan and benefit type otherwise payable.

Benefit without Ordinary IPOD

enactment: None Disability Disability Service Death

Cost for revised 9 times 5 times 2.5 times 2 times 11 times

benefit: salary salary salary salary salary

However, we anticipate that few additional accidental disability

retirements and death benefits will be granted, and thus, the resulting

costs are expected to be negligible. All costs will be shared by the

State of New York and the participating employers in the PFRS. Summary

of relevant resources:

The membership data used in measuring the impact of the proposed

change was the same as that used in the March 31, 2019 actuarial valu-

ation. Distributions and other statistics can be found in the 2019

Report of the Actuary and the 2019 Comprehensive Annual Financial

Report.

The actuarial assumptions and methods used are described in the 2015,

2016, 2017, 2018 and 2019 Annual Report to the Comptroller on Actuarial

Assumptions, and the Codes, Rules and Regulations of the State of New

York: Audit and Control.

The Market Assets and GASB Disclosures are found in the March 31, 2019

New York State and Local Retirement System Financial Statements and

Supplementary Information.

I am a member of the American Academy of Actuaries and meet the Quali-

fication Standards to render the actuarial opinion contained herein.

This fiscal note does not constitute a legal opinion on the viability

of the proposed change nor is it intended to serve as a substitute for

the professional judgment of an attorney.

This estimate, dated February 6, 2020, and intended for use only

during the 2020 Legislative Session, is Fiscal Note No. 2020-52,

prepared by the Actuary for the New York State and Local Retirement

System.

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

SUMMARY OF BILL: This proposed legislation as it relates to the New

York City Fire Pension Fund (FIRE) would amend the General Municipal Law

(GML) to add a new Section 207-kkk to provide a statutory presumption to

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certain FIRE members and retirees who become physically incapacitated

for performance of duty, or die, while so employed, or within 2 years of

their respective date of retirement, due to Parkinson's Disease.

A qualifying FIRE member or retiree who dies or suffers from a disa-

bility due to Parkinson's Disease, absent evidence of such condition

upon physical examination at hire, would be provided with a rebuttable

presumption that such disability was incurred in the performance and

discharge of duty. The presumption of causation could be rebutted by

competent evidence to the contrary.

Effective Date: Upon enactment.

FINANCIAL IMPACT - OVERVIEW: There is no data available to estimate

the number of members or eligible retirees who might develop and become

disabled or die due to Parkinson's Disease, and potentially benefit from

this proposed legislation. Therefore, the estimated financial impact

has been calculated on a per event basis equal to the increase in the

Present Value of Future Benefits (PVFB) for an average affected member

who is diagnosed with Parkinson's Disease as the result of the enactment

of the proposed legislation and who would benefit from the proposed

legislation.

In determining the increase in the PVFB, it has been assumed that 100%

of the members who would retire with Parkinson's Disease would retire

under ordinary disability if the proposed legislation were not passed.

Due to the progressive nature of Parkinson's Disease, the increase in

PVFB does not include any cost for additional death benefits.

With respect to an individual member or eligible retiree, the addi-

tional cost of this proposed legislation varies greatly.

FINANCIAL IMPACT - PRESENT VALUES: Based on the census data and the

actuarial assumptions and methods described herein, the enactment of

this proposed legislation would increase the PVFB by an amount ranging

from $181,700 to $1,351,200 if an eligible firefighter who could benefit

from the proposed legislation develops Parkinson's Disease. The average

increase in PVFB for a single eligible member who could benefit from the

proposed legislation is approximately $594,400.

FINANCIAL IMPACT - ANNUAL EMPLOYER CONTRIBUTIONS: Enactment of this

proposed legislation would increase employer contributions, where such

amount would depend on the number of members affected as well as other

characteristics including the age, years of service, and salary of each

member.

As there is no data currently available to estimate the number of

members who might be diagnosed with Parkinson's Disease, the financial

impact would be recognized at the time of event. Consequently, changes

in employer contributions have been estimated assuming that the increase

in the PVFB will be financed over a time period used for actuarial loss-

es in accordance with Section 13-638.2(k-2) of the ACCNY. Using this

approach, the additional PVFB would be amortized over a closed 15-year

period (14 payments under the One-Year Lag Methodology) using level

dollar payments.

Based on the Actuary's actuarial assumptions and methods in effect as

of June 30, 2019, the enactment of this proposed legislation is esti-

mated to increase annual employer contributions by an amount ranging

from $21,500 to $159,800 if a qualifying member develops Parkinson's

Disease. The average increase in annual employer contributions for a

single member who could benefit from the proposed legislation is approx-

imately $70,300. With respect to the timing, increases in employer

contributions would depend upon when members begin to receive an acci-

dental benefit due to Parkinson's Disease but, generally, increased

S. 8012--A 4

employer contributions will first occur the second fiscal year following

approval of the accident disability retirement.

CENSUS DATA: The estimates presented herein are based on the census

data used in the Preliminary June 30, 2019 (Lag) actuarial valuation of

FIRE to determine the Preliminary Fiscal Year 2021 employer contrib-

ution.

There are 11,244 active FIRE members as of June 30, 2019 who could

potentially benefit from the proposed legislation. These active members

had an average age of approximately 40.5 years, average service of

approximately 13.8 years, and an average salary of approximately

$118,900.

There are 250 retired FIRE members who retired between July 1, 2017

and June 30, 2019 who were receiving a pension benefit, other than Acci-

dental Disability, as of June 30, 2019 and could potentially benefit

from the proposed legislation. These retired members had an average age

of approximately 56.2 years and an average pension benefit of approxi-

mately $109,000.

ACTUARIAL ASSUMPTIONS AND METHODS: The changes in the Present Value of

future employer contributions and annual employer contributions

presented herein have been calculated based on the actuarial assumptions

and methods in effect for the June 30, 2019 (Lag) actuarial valuations

used to determine the Preliminary Fiscal Year 2021 employer contribution

of FIRE.

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 FIRE 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 meth-

ods 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 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 2020-35 dated May 7, 2020

was prepared by the Chief Actuary for the New York City Fire Pension

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

Session.