STATE OF NEW YORK ________________________________________________________________________ 4262 2025-2026 Regular Sessions IN SENATE February 3, 2025 ___________ Introduced by Sen. JACKSON -- read twice and ordered printed, and when printed to be committed to the Committee on Cities 1 AN ACT to amend the administrative code of the city of New York, in relation to promotions of police detectives, sergeants, and lieuten- ants for retirement purposes The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Section 14-114 of the administrative code of the city of 2 New York is amended by adding a new subdivision d to read as follows: 3 d. (1) Notwithstanding any provision of law to the contrary, when a 4 detective, sergeant, or lieutenant shall have accrued twenty-five years 5 of uniformed service with the New York city police department, and 6 retires in any such rank, they shall have five per centum of the highest 7 grade of pay under the applicable collective bargaining agreement of 8 such rank in which they retire, added to the applicable salary, used for 9 the purposes of computing pension benefits under the plan in which they 10 are enrolled with the New York city police pension fund. A member who 11 receives an increase to their pension benefit under this paragraph shall 12 not receive an additional increase under section 14-111 of this chapter; 13 or 14 (2) Notwithstanding any provision of law to the contrary, when a 15 detective, sergeant, or lieutenant shall have accrued thirty years of 16 uniformed service with the New York city police department, and retires 17 in any such rank, they shall have ten per centum of the highest grade of 18 pay under the applicable collective bargaining agreement of such rank in 19 which they retire, added to the applicable salary, used for the purposes 20 of computing pension benefits under the plan in which they are enrolled 21 with the New York city police pension fund. A member who receives an 22 increase to their pension benefit under this paragraph shall not receive 23 an additional increase under section 14-111 of this chapter; or EXPLANATION--Matter in italics (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD00082-03-5
S. 4262 2 1 (3) Notwithstanding any provision of law to the contrary, when a 2 detective, sergeant, or lieutenant shall have accrued thirty-five years 3 of uniformed service with the New York city police department, and 4 retires in any such rank, they shall have fifteen per centum of the 5 highest grade of pay under the applicable collective bargaining agree- 6 ment of such rank in which they retire, added to the applicable salary, 7 used for the purposes of computing pension benefits under the plan in 8 which they are enrolled with the New York city police pension fund. A 9 member who receives an increase to their pension benefit under this 10 paragraph shall not receive an additional increase under section 14-111 11 of this chapter. 12 § 2. This act shall take effect immediately. FISCAL NOTE.--Pursuant to Legislative Law, Section 50: SUMMARY: This proposed legislation, as it relates to the New York City Police Pension Fund (POLICE), would increase the salary used for deter- mining pension benefits for Detectives, Sergeants, and Lieutenants who retire with at least 25 years of uniformed NYPD service. EXPECTED INCREASE (DECREASE) IN EMPLOYER CONTRIBUTIONS by Fiscal Year for the first 25 years ($ in Millions) Year POLICE 2026 0.0 2027 2.8 2028 5.6 2029 8.5 2030 11.5 2031 14.6 2032 17.8 2033 21.2 2034 24.7 2035 28.4 2036 32.4 2037 36.5 2038 41.1 2039 45.9 2040 51.0 2041 53.6 2042 56.2 2043 59.0 2044 61.9 2045 64.9 2046 68.0 2047 71.1 2048 74.3 2049 77.5 2050 80.7 Projected contributions are based on historical experience for Tier 2 members. Future retirement patterns may differ due to a larger impacted Tier 3 population (e.g., Tier 2 is expected to retire at 20 years of service whereas Tier 3 is expected to retire at 25 years of service). The entire increase in employer contributions will be allocated to New York City.
S. 4262 3 PRESENT VALUE OF BENEFITS: The Present Value of Benefits (PVFB) is the discounted expected value of benefits paid to current members if all assumptions are met, including future service accrual and pay increases. The enactment of this proposed legislation is expected to increase the PVFB by approximately $23.3 million in the first year and every year thereafter. Each year's PVFB increase will depend on the actual experi- ence of benefiting retirees and will be recognized in the year benefits are first payable. UNFUNDED ACCRUED LIABILITY (UAL): Actuarial Accrued Liabilities are the portion of the Present Value of Benefits allocated to past service. For purposes of this Fiscal Note, changes in UAL were amortized as an ongoing gain/loss using level dollar payments. AMORTIZATION OF UNFUNDED ACCRUED LIABILITY POLICE Increase (Decrease) in UAL: 23.3 M Number of Payments: 14 First-year Amortization Payment: 2.8 M CENSUS DATA: The estimates presented herein are based on preliminary census data collected as of June 30, 2024. The census data for POLICE active members is summarized below. POLICE Active Members - Number Count: 33,803 - Average Age: 37.5 - Average Service: 11.1 - Average Salary: 134,900 The salaries used in this analysis were provided by the Lieutenants Benevolent Association and are summarized below. o Detectives would use a highest grade of pay of $149,518 o Sergeants would use a highest grade of pay of $149,519 based on the salary provided and adjusted to reflect outstanding wage contracts o Lieutenants would use a highest grade of pay of $164,476 Data from the prior ten years of actuarial valuations was used to estimate the number of retirees who could potentially benefit from this proposed legislation each year and is summarized below. Average Number Retired Detectives Sergeants Lieutenants per Year At least 25 but less than 30 years of service 129 73 51 At least 30 but less than 35 years of service 38 23 20 At least 35 years of service 12 7 7 IMPACT ON MEMBER BENEFITS: The proposed legislation would increase the applicable salary used for computing pension benefits (Final Salary for Tier 2 members or Final Average Salary for Tier 3 members) who retire as a detective, sergeant, or lieutenant with at least 25 years of uniformed NYPD service. The increase in applicable salary would be equal to:
S. 4262 4 o 5% for members with at least 25 years of service, 10% for members with at least 30 years of service, or 15% for members with at least 35 years of service, multiplied by o The highest grade of pay under the applicable collective bargaining agreement of the rank in which the member retires. For example, a Detective who retires with 32 years of uniformed NYPD service would receive an increase in their annual pension of approxi- mately $7,476 (a 50% annual benefit of 10% multiplied by the highest- grade detective pay of $149,518). This additional benefit would then be subject to applicable Cost-of-Living or Escalation increases. Based on an estimate of the number of POLICE members who are expected to be impacted by this proposed legislation, the annual increase in POLICE pension benefits paid will be approximately $1.9 million in the first year and increase in every year thereafter. With respect to an individual member, the impact on benefits due to this proposed legislation could vary greatly depending on the member's age, years of service, retirement cause, and Tier. ASSUMPTIONS AND METHODS: The estimates presented herein have been calculated based on the Revised 2021 Actuarial Assumptions and Methods of the impacted retirement systems. In addition: o New entrants were assumed to replace exiting members so that total payroll increases by 3% each year for impacted groups. New entrant demo- graphics were developed based on data for recent new hires and actuarial judgement. o Future contribution impacts have been developed assuming a homogene- ous population and consistent retirement pattern. RISK AND UNCERTAINTY: The costs presented in this Fiscal Note depend highly on the actuarial assumptions, methods, and models used, demo- graphics of the impacted population, and other factors such as invest- ment, contribution, and other risks. If actual experience deviates from actuarial assumptions, the actual costs could differ from those presented herein. Quantifying these risks is beyond the scope of this Fiscal Note. This Fiscal Note is intended to measure pension-related impacts and does not include other potential costs (e.g., administrative and Other Postemployment Benefits). This Fiscal Note does not reflect any chapter laws that may have been enacted during the current legislative session. STATEMENT OF ACTUARIAL OPINION: Marek Tyszkiewicz and Gregory Zelikov- sky are members of the Society of Actuaries and the American Academy of Actuaries. We are members of NYCERS, but do not believe it impairs our objectivity, and we meet the Qualification Standards of the American Academy of Actuaries to render the actuarial opinion contained herein. To the best of our 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 2025-04 dated January 31, 2025 was prepared by the Chief Actuary for the New York City Retirement Systems and Pension Funds and is intended for use only during the 2025 Legislative Session.