BILL NUMBER: S8361
SPONSOR: JACKSON
 
TITLE OF BILL:
An act to amend the administrative code of the city of New York, in
relation to the rate of interest used in the actuarial valuation of
liabilities for the purpose of calculating contributions to the New York
city employees' retirement system, the New York city teachers' retire-
ment system, the police pension fund, subchapter two, the fire depart-
ment pension fund, subchapter two and the board of education retirement
system of such city by public employers and other obligors required to
make employer contributions to such retirement systems, the crediting of
special interest and additional interest to members of such retirement
systems, and the allowance of supplementary interest on the funds of
such retirement systems
 
SUMMARY OF PROVISIONS:
This bill would extend for four fiscal years, until June 30, 2029, the
current 7% per annum statutory rate of interest used by the Chief Actu-
ary ("Actuary") for the New York City Employees' Retirement System,
Teachers' Retirement System, Board of Education Retirement System,
Police Pension Fund and Fire Department Pension Fund ("City retirement
systems") in valuing retirement system liabilities for the purpose of
computing the amount of employer contributions to those systems. The
bill also would extend for that same period the current rates of special
interest, additional interest and supplementary interest, which, in
effect, govern the amount of interest to be paid into certain constitu-
ent funds of the City retirement systems, and the amount of interest to
be credited on accumulated member contributions and increased-take-home-
pay reserves of Tier 1 and 2 members of those retirement systems. The
current valuation rate of interest and the rate of supplementary inter-
est were originally enacted by Chapter 3 of the Laws of 2013. The
current rates of special and additional interest were continued and
recodified by Chapter 878 of the Laws of 1990 and have remained the same
since. The current two-year period ending on June 30, 2025 for all these
rates of interest was enacted by Chapter 184 of the Laws of 2023.
 
REASONS FOR SUPPORT:
The current rates of interest are effective for the period ending June
30, 2025, and expire as of July 1, 2025.
The City of New York recommends to the Legislature that this bill
providing for a four-year extension of the current valuation rate of
interest and the accompanying rates of special, additional, and supple-
mentary interest be enacted. The Actuary has stated that the proposed
current four-year extension of these rates to June 30, 2029, is consist-
ent with the recommendations of City retirement systems' investment
advisers and the most recent final recommendations regarding these rates
from its actuarial auditor, retained pursuant to New York City Charter
section 96, and is advisable to align future rates with scheduled expe-
rience analysis of future audits.
The boards of trustees of the City retirement systems have voted to
support this legislation for a four-year extension of the current valu-
ation rate of interest and the accompanying rates of special, addi-
tional, and supplementary interest.
It should be noted that the Legislature enacted similar four-year exten-
sions of such interest rates for the City retirement systems in 1996,
2000 and 2013. See Chapter 249 of the Laws of 1996, Chapter 85 of the
Laws of 2000 and Chapter 3 of the Laws of 2013, respectively.
As this bill would continue the existing valuation rate of interest and
the existing rates of special, additional, and supplementary interest,
its enactment would not change the amount or timing of expected employer
contributions.
Accordingly, the Mayor urges the earliest possible favorable consider-
ation of this proposal by .the Legislature.
Respectfully submitted,
SHANNA F. WITHERSPOON Director
SHW:3/21/25