WeVote
Log In

Bill

Bill

A 10414

Establishes a twenty-five year retirement program for members of the NYC employees' retirement system employed as water supply police

2025 Regular Session Introduced by Stacey Pheffer Amato

New optional 25-year WSP retirement under NYCERS with 50% FAS at 25 years plus 2%/yr after, funded by a 6% employee contribution and employer pick-up.

REPORTED REFERRED TO WAYS AND MEANS
0
WeVote Research Nonpartisan
Bill Summary · A 10414

Summary of Bill A.10414 (2025-2026) — New York

Main purpose and intent

  • Establishes an optional 25-year retirement program for members of the New York City Employees' Retirement System (NYCERS) who are employed as water supply police.
  • Creates a framework for employer “pick up” of additional member contributions (tax-advantaged via IRS rules) and sets out the rules, funding, and administration of these enhanced benefits.
  • Addresses repeal of certain provisions after expiration, and provides for the orderly transition and eligibility rules for participants.

Key provisions and changes

  • New program creation

    • Introduces a 25-year improved benefit retirement program for water supply police (WSP) members within NYCERS.
    • The program provides enhanced retirement benefits if a member completes 25 years of credited service.

  • Eligibility and enrollment

    • Water supply police members on the program’s starting date may elect to participate within 180 days after that date.
    • Members who become WSP after the starting date may elect to participate within 180 days after becoming a WSP member.
    • Elections to participate are irrevocable.
    • If a participant ceases to be a WSP member (while not in continued public service), they lose participation and benefits during gaps.

  • Benefits formula for participants (service retirement)

    • At 25+ years of credited service: 50% of final average salary (FAS) for the first 25 years, plus 2% of FAS for each additional year beyond 25, up to a maximum of 5 additional years (i.e., up to 30 total years for the enhanced schedule).
    • For those with less than 25 years, the vested benefit is 2% of FAS per year, payable at the time they would have reached 25 years under the plan.
    • Maximum benefit without optional modification is capped to the benefit payable at 30 years of service.

  • Additional member contributions

    • Participants must contribute an additional 6% of compensation for service after the starting date and (for certain periods) after ceasing to be a participant, until the later of the first anniversary of starting date or 30 years of service as a WSP.
    • These contributions are designated as “additional member contributions” and are intended to be in lieu of other pre-existing rules for additional contributions.
    • Methods are provided for payment, deficiencies, interest, and potential penalties if contributions are paid late or not at all.
    • The extra contributions go into a contingent reserve fund and are not considered part of regular accumulated deductions while a participant remains in the program.

  • Employer pick-up option (Section 604-k and related changes)

    • The employer (city) must pick up and pay the additional member contributions for water supply police participants, treating them as employer contributions under IRS 414(h).
    • Picked-up contributions are deducted from the participant’s compensation as if not picked up, and are treated as part of the participant’s retirement benefits calculations.
    • Pick-up contributions are not taxable to the employee for federal income tax purposes until distributed.

  • Regulatory and administrative changes

    • Adds a new NYC Administrative Code provision (13-125.2 a-9, and related amendments) to implement pick-up mechanics and treatment for WSP participants under the 25-year program.
    • Allows the NYCERS Board to promulgate regulations governing the payment and treatment of the additional contributions and pick-up arrangements.

  • Service retirement and vesting specifics (25-year program)

    • Service retirement for 25-year participants is triggered by meeting all eligibility criteria (25+ years, full payment of required additional contributions, and a retirement application filed not less than 30 days after election).
    • Early retirement provisions mirror plan design, with a benefit structure aligned to the 25-year program (50% of FAS for 25 years, plus 2% per year thereafter, up to 30 years total).
    • Vesting provisions for deferred vested benefits apply if a participant discontinues service but has met certain credit requirements and has not withdrawn contributions.

  • Portability and return-to-service rules

    • If a participant re-enters service as a WSP member, they can re-enter the program on the date they rejoin.
    • If a participant withdraws from the program, rules govern withdrawals of additional contributions with interest and potential refunds.

  • Sunset and contingencies

    • The act contains provisions about expiration and contingent federal tax treatment (subject to IRS rules) and cites that some sections will expire as legislated or under related chapters.

Who would be affected

  • Primary: Water supply police members of NYCERS (NYC water supply police employees).
  • Secondary: NYC employers (City of New York) as the entity required to pick up and contribute the additional member contributions.
  • NYCERS system and its trustees, which would administer the program, collect additional contributions, issue benefits, and regulate loans/withdrawals related to the program.

Procedural and timeline aspects

  • Enrollment window: For starting-date participants, 180 days from the effective date; for new entrants, 180 days after becoming a WSP member.
  • Effect of participation: Enrollment is irrevocable; discontinuation or return to service affects eligibility for benefits under the program.
  • Effective date: The act states it takes effect immediately, with several contingent provisions linking to federal tax treatment and expiration rules as described.
  • Fiscal note: Estimates indicate expected increases in NYCERS employer contributions for the first 25 years, with year-by-year figures; some years show a net decrease in costs beginning around the 2030s-2040s due to actuarial assumptions and new entrants, though initial impacts are higher. The NYC Department of Finance/Actuaries assess a long-term shift in employer costs and benefits.

Summary assessment

Bill A.10414 creates a targeted, optional 25-year retirement track within NYCERS for water supply police personnel, funded by a 6% extra employee contribution and supported by employer pick-up of those contributions. It sets a defined benefit formula (50% of FAS after 25 years plus 2% per year thereafter) and provides rules for enrollment, vesting, deferral, and repayments of contributions, as well as administrative mechanisms to implement and regulate the plan. The fiscal note anticipates an initial rise in NYCERS employer costs, with potential long-term cost dynamics influenced by new hires and actuarial assumptions. The program is voluntary for eligible WSP members, with irrevocable participation, and includes contingencies related to taxation and expiration.

Compiled from official sources — confirm details with the bill’s official record.

Sign in to ask a question.