ARTIFICIAL INTELLIGENCE [AI] IS NOT USED, IN WHOLE OR IN PART, IN PREPARING NYPPL SUMMARIES OF JUDICIAL AND QUASI-JUDICIAL DECISIONS

September 04, 2015

Employer contributions to New York State and Local Retirement System will decrease for fiscal year 2016-17


Employer contributions to New York State and Local Retirement System will decrease for fiscal year 2016-17
Source: Office of the State Comptroller

On September 4, 2015 New York State Comptroller Thomas P. DiNapoli announced the New York State and Local Retirement System (NYSLRS) employer contribution rates will decrease for fiscal year 2016-17 and the assumed rate of return for NYSLRS will be lowered from 7.5 percent to 7 percent.*

The average contribution rate for the Employees’ Retirement System (ERS) will decrease from 18.2 percent of payroll to 15.5 percent. While the average contribution rate for the Police and Fire Retirement System (PFRS) will decrease from 24.7 percent of payroll to 24.3 percent. This is the third year in a row that there will be a decline in pension contribution rates as a result of solid investment returns DiNapoli said.

Predicting a “tougher investment climate ahead,“ the Comptroller said that assuming a lower assumed rate of return is fiscally prudent and will better position the state pension fund for the future.**  Employer rates are determined based on actuarial assumptions recommended by NYSLRS’ actuary Michael R. Dutch.

The announced rates will apply to each employer’s salary base during the period April 1, 2015 through March 31, 2016. Payments based on those rates are due by Feb. 1, 2017, but may be pre-paid by Dec. 15, 2016. Projections of required contribution rates will vary by employer depending on factors such as retirement plans, salaries and the distribution of employees among the six retirement tiers.

This is the second time since becoming State Comptroller in 2007 that the Comptroller has lowered the assumed rate of return. In 2010, he lowered the assumed rate of return from 8 percent to 7.5 percent. According the National Association of State Retirement Administrators, the median assumed rate of return for public pension funds is 7.75 percent.

The Annual Report to the Comptroller on Actuarial Assumptions is posted on the Internet at:
http://www.osc.state.ny.us/retire/word_and_pdf_documents/reports/actuarial_assumption/aa_2015.pdf

A chart of historical employer contribution rates is posted on the Internet at:
http://www.osc.state.ny.us/press/releases/sept15/1972-2017_Hist_Emp_Contrib_Avg_Rates.pdf

A “fact sheet” about the NYSLRS is posted on the Internet at:

*  The National Association of State Retirement Administrators reports that the median assumed rate of return for public pension funds is 7.75 percent.

** The audited value of the New York State Common Retirement Fund as of March 31, 2015 was $184.5 billion.

CAUTION

Subsequent court and administrative rulings, or changes to laws, rules and regulations may have modified or clarified or vacated or reversed the decisions summarized here. Accordingly, these summaries should be Shepardized® or otherwise checked to make certain that the most recent information is being considered by the reader.
THE MATERIAL ON THIS WEBSITE IS FOR INFORMATION ONLY. AGAIN, CHANGES IN LAWS, RULES, REGULATIONS AND NEW COURT AND ADMINISTRATIVE DECISIONS MAY AFFECT THE ACCURACY OF THE INFORMATION PROVIDED IN THIS LAWBLOG. THE MATERIAL PRESENTED IS NOT LEGAL ADVICE AND THE USE OF ANY MATERIAL POSTED ON THIS WEBSITE, OR CORRESPONDENCE CONCERNING SUCH MATERIAL, DOES NOT CREATE AN ATTORNEY-CLIENT RELATIONSHIP.
NYPPL Blogger Harvey Randall served as Principal Attorney, New York State Department of Civil Service; Director of Personnel, SUNY Central Administration; Director of Research, Governor’s Office of Employee Relations; and Staff Judge Advocate General, New York Guard. Consistent with the Declaration of Principles jointly adopted by a Committee of the American Bar Association and a Committee of Publishers and Associations, the material posted to this blog is presented with the understanding that neither the publisher nor NYPPL and, or, its staff and contributors are providing legal advice to the reader and in the event legal or other expert assistance is needed, the reader is urged to seek such advice from a knowledgeable professional.
New York Public Personnel Law. Email: publications@nycap.rr.com