STATEMENT TO

ASSEMBLY, No. 3688

with Assembly Floor Amendments

(Proposed By Assemblyman CRYAN)

ADOPTED: FEBRUARY 5, 2009

      These Assembly amendments permit local employers to contribute more than their reduced required contributions to the Public Employees' Retirement System (PERS) and the Police and Firemen's Retirement System (PFRS) during State fiscal years 2009 through 2011 and provide for the calculation of separate resultant unfunded liabilities for each employer.

      The amendments provide that the State Treasurer will reduce for local employers the normal and accrued liability contributions to a percentage of the amount certified annually by the PERS and PFRS, which percentage will be not more than 50% for payments due in State fiscal year 2009; not more than 60% for payments due in State fiscal year 2010; and not more than 80% for payments due in State fiscal year 2011, while allowing a local employer to elect to pay more than the amount proscribed and to be credited with such payment, which will not be included in the employer’s unfunded liability.  An employer wishing to pay more than the minimum contributions may elect to pay 75% or 100% of the total required contribution for State fiscal year 2009, 80% or 100% for State fiscal year 2010, and 90% or 100% for State fiscal year 2011.  The actuaries for PERS and PFRS will determine for each employer the unfunded liability for any reduced contributions, which liability will be paid by an employer over a period of 15 years.   

      The Assembly amendments also delete the no longer necessary sections of the bill that authorize the Director of the Division of Investment in the Department of the Treasury, or a municipality, county or other local unit, to create a special reserve fund to accept and invest moneys of local employers for whom pension contribution requirements were adjusted.

      The amendments also make certain changes to reconcile the differences between the prior pension contribution phase-in and the provisions of this bill with regard to municipal and county cap exceptions.