Relates to calculating certain pensions; increases pension calculation from thirty-five to forty per centum of final average salary.
Summary
A09273 would amend the New York Retirement and Social Security Law to increase the pension formula for certain Tier 6 members of the New York City retirement systems. For eligible general members and other covered public retirement system members who retire with 20 or more years of credited service, the bill raises the base pension component from 35 percent to 40 percent of final average salary, while preserving the existing additional accrual for service above 20 years. It also updates related retirement provisions so that the enhanced formula applies to specified members retiring at normal retirement age and to eligible employees retiring under the bill’s benefit enhancement section.
The bill is aimed at members of NYCERS, TRS, and BERS, and it applies to certain employees who first joined a public retirement system on or after April 1, 2012. It takes effect immediately and expressly exempts its provisions from section 25 of the retirement and social security law. The accompanying fiscal note estimates significant increased employer contribution costs over time, reflecting higher pension obligations for current and future covered members.
Impact
The bill would directly amend sections 504, 604, and 1312 of the Retirement and Social Security Law to increase retirement benefits for covered Tier 6 members. In practical terms, it would raise the pension multiplier for qualifying members from 35% to 40% of final average salary, increasing the amount payable upon retirement for employees with 20 or more years of credited service. The fiscal note indicates the change would increase employer contributions for New York City and other obligors of the New York City Retirement Systems, with long-term actuarial costs and unfunded liability increases for NYCERS, TRS, and BERS.
Sentiment
The overall sentiment appears supportive of enhanced retirement benefits for public employees, as reflected by the bill’s advancement and amendment to increase the pension formula. The bill text and fiscal note frame the measure as a benefit enhancement for long-serving members rather than a structural overhaul of the retirement systems. At the same time, the fiscal note makes clear that the proposal carries substantial cost implications, suggesting that any support is likely tempered by concern over the financial impact on employers and pension funds.
Contention
The main point of contention is fiscal cost. The bill would increase employer pension contributions substantially, with the fiscal note projecting rising annual costs and higher unfunded accrued liabilities for the affected retirement systems. Supporters are likely to emphasize improved retirement security and fairness for Tier 6 members with long service, while opponents or budget-conscious stakeholders may object to the added burden on New York City and other contributing employers. Another likely issue is that the benefit increase is targeted to specific Tier 6 members, which may raise questions about equity across tiers and among different public employee groups.
Recalibrates the final average salary retirement calculations in the New York state teachers' retirement system for Joanne Halverson by including certain earnings from the 2020-2021 year.
Authorizes a thirty year retirement benefit for certain members in Nassau county; provides a retirement allowance equal to 60 percent of a member's final average salary.
Authorizes a thirty year retirement benefit for certain members in Nassau county; provides a retirement allowance equal to 60 percent of a member's final average salary.