55-25 Retirement incentive passes — UPDATE
Tuesday, April 13th, 2010 at 10:58 am by Robert Lowry
Yesterday, the Assembly passed the “55-25″ retirement incentive bill. It had previously passed the Senate and will now go to Governor Paterson for his consideration. Since the bill was introduced at the request of the Governor, his approval should come quickly.
Text of the bill is available here. Major elements of the bill are summarized below.
UPDATE (April 14, 6:08 pm): Governor Paterson has now signed the bill into law.
The bill creates a three month window during which “eligible employees” who are members of the New York State Teachers Retirement System (TRS) or the New York State and Local Employees Retirement System (ERS) would be permitted to retire without penalty if they have reached age 55 and have at least 25 years of service.
For employees in tiers 2, 3, or 4, 30 years of service are otherwise required to retire without penalty.
“Eligible employees” are employees of school districts, BOCES, State University institutions, private (“4201″) schools for the blind and deaf, special act school districts, and county vocational education extension boards who are members of TRS or ERS and hold “a position represented by the recognized collective bargaining units affiliated with the New York state united teachers employee organization.”
For school (non-SUNY) employers, the window would start on June 1 and end on August 31.
Employers do not have discretion to opt-out of participation.
The costs would be born by all employers participating in TRS and ERS, whether or not they have retirees receiving a benefit. TRS has estimated that due to the bill, its employer contribution rate would rise by 0.09 percent (i.e., from the current estimate of 8.62 percent of payroll for 2010-11 to 8.71 percent). ERS cost estimates are less straightforward. Both are dependent on predicting the number of eligible employees who will retire during the window period.
The bill provides that, “Notwithstanding any other provision of law, this act shall have no impact on retirement incentives, options or inducements offered as part of a contractual agreement between an eligible employee and eligible employer which were negotiated prior to the effective date of this act.” In other words a retiree may receive both this incentive and a previously negotiated local incentive.
FYI, here is what New York State Teachers is advising its members about the incentive.
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April 13th, 2010 at 6:31 pm
Is there any possibity this incentive will be offered next year also?
April 14th, 2010 at 5:04 pm
There is nothing in the bill (now law) to assure that it would be offered again next year.
Given the expectation that next year will present us another rough state budget, I would not be surprised to see proposals for further retirement incentives. But you cannot count on anything being adopted.
April 15th, 2010 at 11:56 pm
Would you explain the incentive in more specific terms and with an example. If the employee’s annual salary were $87,000, What would the payment be from the retirementincentive? Monthly, yearly? Are there any drawbacks with this incentive?
Thank you.
April 16th, 2010 at 1:42 pm
Bob,
Any word on whether they will extend this to school employees who do not belong to NYSUT?
April 18th, 2010 at 7:44 am
Am I correct in my reading of the bill that it does not apply at all to teachers over 55, with more than 25 years, and on Tier 1?
April 18th, 2010 at 7:38 pm
Last week it was reported that the Governor was considering giving a “55-25″ or other retirement incentive to state employees.
That would provide another opportunity for the Legislature to extend the 55-25 incentive to school employees other than those in NYSUT. But there is nothing anyone can count on yet.
April 18th, 2010 at 7:43 pm
I strongly recommend contacting the Teachers Retirement System with any questions regarding how the incentive would affect a specific individual case.
TRS has posted some explanatory material here: http://www.nystrs.org/main/2010_Incentive/intro.html
April 18th, 2010 at 7:51 pm
My understanding is that the new law has no benefit for Tier 1 members because they could already retire at age 55 without penalty, provided they have at least 20 years of service.
But I strongly recommend contacting the Teachers Retirement System with any questions regarding how the incentive would affect a specific individual case.
TRS has posted some explanatory material here: http://www.nystrs.org/main/2010_Incentive/intro.html
April 21st, 2010 at 7:33 pm
Please advise for my situation. I qualify for the 55/25 retirement incentive for the age ( 57) and years (25). 3 years ago my job at my BOCES was changed from the teacher line to something called “teacher specialist” It required me to leave the Union to keep the job and salary. I had previously been in the classroom as a SPED teacher for 16 years, past 9 have been SETRC working in the schools in my BOCES region. Now I find out that I am not eligible for this incentive b/c I’m not in a bargaining unit, when there is no bargaining unit available to me. I asked but there was none. I did maintain my NYSUT Associate membership for about $40.00/year, and it states on the card that expires 8/31/10 that I am a member in good standing! What support can you give me?
I am in tier 4 and deserve the same option to retire early without a penalty as anybody else since I was a NYSUT member for those 22 years. Please tell me who I can call, write, visit… to help my case. I already spoke to a rep today at NYSUT, who told me I was not covered in this law. This seems very unfair.
I’m hoping something still can be done. Thank you very much.
April 21st, 2010 at 9:49 pm
This is not my area of expertise and I recommend speaking with people at NYSUT and TRS.
However, my interpretation would be that you are not eligible.
The law says that to be eligible, an employee must hold “a position represented by the recognized collective bargaining units affiliated with the New York state united teachers employee organization.”
There is an effort to get the law amended to cover more people, but whether that effort will succeed is uncertain.
May 3rd, 2010 at 6:56 am
what about all the other people who work for school districts and are in different unions? it effects more of us than the 500 nysut members this bill written for .