Let Deputy Retire Early

Section 1. Notwithstanding any other provision of law to the contrary, Theodore Blank, a member of the optional twenty-five year retirement plan for certain sheriffs, undersheriffs, deputy sheriffs and correction officers pursuant to section 89-p of the retirement and social security law, who was employed as Columbia county sheriff in 2014, and who through no fault of his own, failed to file a timely application to participate in the special twenty year retirement plan contained in section 553 of the retirement and social security law resulting in the crediting of his service with the county of Columbia in the retirement plan contained in section 89-p of such law, shall be given full credit in the section 553 twenty year retirement plan for such service upon the election of the county of Columbia to assume the additional cost of such service and his election to participate in such plan. The county of Columbia may so elect within one year of the effective date of this act, by filing with the state comptroller a resolution of its local legislative body together with certification that such member did not bar himself from participation in such retirement plan as a result of his own negligence.

§ 2. Such deputy sheriff may elect to be covered by the provisions of section 553 of the retirement and social security law and shall be entitled to the full rights and benefits associated with coverage under such section by filing a request to that effect with the state comptroller within eighteen months of the effective date of this act.

§ 3. All employer past service costs associated with the implementation of this act shall be borne by Columbia county, and may be amortized over a period of five years.

§ 4. This act shall take effect immediately.

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

[ ] is old law to be omitted.

LBD16546-03-0

S. 8477 2

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

This bill would allow Theodore Blank, a current member of the New York

State and Local Employees' Retirement System employed as a deputy sher-

iff by Columbia County and covered under the 25 year retirement plan of

section 89-p of the Retirement and Social Security Law (RSSL), to elect

to be covered under the 20 year plan of section 553 of the RSSL. Upon

such election, all of his service currently creditable under 89-p will

become creditable under 553. This includes service that he earned in a

title other than deputy sheriff, which is not currently allowed under

the provisions of Article 14-B.

If this bill is enacted during the 2020 legislative session, we antic-

ipate that there will be an increase of approximately $8,700 in the

annual contributions of Columbia County for the fiscal year ending March

31, 2021. In future years, this cost will vary as the billing rates and

salary of Theodore Blank change.

In addition to the annual contributions discussed above, there will be

an immediate past service cost of approximately $88,700 which will be

borne by Columbia County as a one-time payment.

This estimate is based on the assumption that payment will be made on

February 1, 2021. If Columbia County elects to amortize this cost over a

5-year period, the cost for the first year including interest would be

$20,200.

Internal Revenue Service (IRS) plan qualification issues: granting

service credit towards retirement in the 20 year plan of section 553 of

the RSSL for employment that was not rendered as a deputy sheriff could

jeopardize the Retirement System's governmental plan status and its

exemption from ERISA. This could result in the loss of qualified status,

which would mean the loss of tax benefits and would substantially impair

the System's value to our more than one million participants.

Prior to the enactment of this legislation, we recommend that a favor-

able ruling be obtained from the IRS stating that these provisions would

not harm the qualification status of the System. It is estimated that

the costs to obtain such a ruling would be $28,000 for the services of

the IRS, and $800 per hour for legal consultants.

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 June 3, 2020, and intended for use only during

the 2020 Legislative Session, is Fiscal Note No. 2020-122, prepared by

the Actuary for the New York State and Local Retirement System.