§ 521 — Collection of contributions

§ 521. Collection of contributions. 1. The collection of members'\ncontributions shall be as follows:\n a. Each employer shall cause to be deducted on each and every payroll\nof a contributor for each and every payroll period, the contribution\npayable by such contributor as provided in this article. Each employer\nshall certify to the treasurer of said employer on each and every\npayroll a statement as voucher for the amounts so deducted.\n b. The treasurer of each employer on receipt from the employer of the\nvoucher for deductions from the salaries of teachers as provided in this\narticle shall transmit monthly or at such times as the retirement board\nshall designate, the amount specified in such voucher to the secretary\nof the retirement board. The secretary of the retirement board after\nmaking record of all such receipts shall transmit them to the head of\nthe division of the treasury in the department of taxation and finance\nfor use according to the provisions of this article.\n But nothing in this section shall prevent the retirement board from\nmodifying the method of collecting the contribution of members so that\nemployers may retain the amounts so deducted and have a corresponding\namount deducted from the appropriation for the support of common schools\notherwise payable to them.\n 2. The collection of employers' contributions shall be made as\nfollows:\n a. Upon the basis of each actuarial determination and appraisal\nprovided herein, the retirement board shall annually prepare and certify\nto the commissioner of education a statement of the total amount\nnecessary to be paid by all employers for the ensuing fiscal year to the\npension accumulation and expense funds as provided under subdivision two\nof section five hundred seventeen and under section five hundred\nnineteen of this article. Upon the basis of the rate of contribution for\nsupplemental retirement allowances, determined in accordance with\nsection five hundred thirty-two of this article, the retirement board\nshall certify to the commissioner of education a statement of the total\namount necessary to be paid by all employers for the ensuing fiscal year\nto the supplemental retirement allowance fund. Said certification shall\ninclude interest on amounts necessary to repay advances made to the\nsupplemental retirement allowance fund pursuant to subdivision f of\nsection five hundred thirty-two of this article computed from the date\nof such advances at the rate determined in accordance with paragraph f\nof this subdivision.\n b. The commissioner of education shall include in the certificate\nwhich he files with the state comptroller showing the amount of state\nfunds apportioned to the school districts within each county for the\nsupport of common schools, a statement showing the amount to be\ncontributed by each employer in each of such counties as required under\nthis article.\n The amount to be contributed by each employer except those who operate\nlocal district pension systems, shall be such percentage of the total\ncompensation or salaries of all teachers in his employ who are members\nof the retirement system as the aggregate amount of the normal and\ndeficiency contributions for the year shall bear to the total\ncompensation or salaries paid by all employers, except those who operate\nlocal district pension systems, to all teachers who are members of the\nretirement system.\n c. The comptroller shall issue his warrant to the custodian of such\nfund directing such custodian to credit to the pension accumulation fund\nand expense fund respectively, from the appropriation for the support of\ncommon schools the amounts required to be made as contributions to such\nfunds by the employers as shown by the certificate of the commissioner\nof education filed with him as directed in paragraph b of this\nsubdivision.\n d. The comptroller, in issuing his warrant to the custodian for\npayment to each county treasurer of that portion of the moneys\napportioned for the support of common schools, shall deduct therefrom an\namount equal to the amount required to be contributed by employers of\nsuch county, as shown by the certificate of the commissioner of\neducation of this state filed with the comptroller as required by\nparagraph b of this subdivision.\n e. In order to meet the financial requirements of this article,\nemployers who obtain funds directly by taxation are hereby authorized\nand directed to levy annually such additional taxes as are required to\nprovide the funds deducted from the amounts apportioned to such\nemployers from the appropriation of the state for the support of the\ncommon schools.\n f. Employers whose payments from the moneys apportioned from the state\nfor the support of common schools are insufficient to pay the amount due\nand owing the system, or who do not receive such payments, shall pay the\nsystem each year the amount of contributions due and owing from the\nemployer pursuant to this article within thirty days from the date a\nbill is mailed by the system. Interest, at a rate equal to the average\nyield payable on fifty-two week United States treasury bills on June\nthirtieth immediately preceding the day the bill is mailed by the\nsystem, shall accrue on the outstanding amount due and owing commencing\nwith the thirty-first day after the bill is mailed.\n g. Whenever the system determines the contributions made by an\nemployer are less than the percentage of total compensation or salaries\nof members of the system in the employ of such employer, as required by\nthis article, such employer shall pay the system such deficiency within\nthirty days from the date a bill is mailed by the system. Interest, at a\nrate equal to the average yield payable on fifty-two week United States\ntreasury bills on June thirtieth immediately preceding the day before\nthe bill is mailed by the system, shall accrue on the outstanding amount\ndue and owing commencing with the thirty-first day after the bill is\nmailed.\n h. Notwithstanding any provision of law to the contrary, commencing\nwith the payments made in the fiscal year beginning July first, nineteen\nhundred ninety, and each fiscal year thereafter, the employer\ncontributions due and payable as determined pursuant to the provisions\nof this article and the employee contributions due and payable pursuant\nto this article and articles fourteen and fifteen of the retirement and\nsocial security law, on account of compensation paid in the fiscal year\nimmediately preceding, and those employer contributions due and payable\nin each fiscal year pursuant to chapter six hundred sixty-five of the\nlaws of nineteen hundred eighty-four shall be made to the retirement\nsystem and collected in the manner set forth in this section each fiscal\nyear in three payments, each equal to thirty-three and one-third percent\nof the total amount due for such fiscal year. Such payments shall be\npaid on September fifteenth, October fifteenth, and November fifteenth\nof each fiscal year. If a participating employer underpaid its\nobligation to the retirement system, such underpayment as determined by\nthe retirement system shall be deducted from the amounts apportioned to\nsuch employer from the appropriation of the state for the support of the\ncommon schools due and payable the next April fifteenth. Employers whose\npayments from such appropriation are insufficient to pay the amount due\nand owing the system, or who do not receive such payments, shall be\nbilled by the system for such underpayment and shall pay the system the\namount due within thirty days from the date a bill is mailed by the\nsystem. The amount of any employer overpayment of its obligation to the\nretirement system, as determined by such system shall be a credit to the\nemployer and shall reduce by an equal amount thereof the initial payment\nto be made by such employer to such system on the next succeeding\nSeptember fifteenth.\n i. Notwithstanding any provision of law to the contrary, the employer\nand employee contributions due and payable in the nineteen hundred\neighty-nine--ninety fiscal year on account of compensation paid in the\nnineteen hundred eighty-eight--eighty-nine fiscal year which were paid\nprior to April first, nineteen hundred ninety shall be deemed (to the\nextent such amount is sufficient) to have consisted of all the employee\ncontributions due and payable pursuant to this article and articles\nfourteen and fifteen of the retirement and social security law in the\nnineteen hundred eighty-nine--ninety fiscal year and those employer\ncontributions due and payable in such fiscal year pursuant to chapter\nsix hundred sixty-five of the laws of nineteen hundred eighty-four; and\nthe remaining employer contributions so paid shall be applied evenly to\nthe payments due and payable on September fifteenth, nineteen hundred\nninety, October fifteenth, nineteen hundred ninety and November\nfifteenth, nineteen hundred ninety and the employer contributions\namounting to eight hundred seventy-three million seven hundred eleven\nthousand six hundred fifteen dollars ($873,711,615), due and payable\npursuant to the provisions of this section in the nineteen hundred\neighty-nine--ninety fiscal year on account of compensation paid in\nnineteen hundred eighty-eight--eighty-nine fiscal year, except those\nemployer contributions due and payable in such fiscal year pursuant to\nchapter six hundred sixty-five of the laws of nineteen hundred\neighty-four, shall be deferred and payment shall be made to the\nretirement system in fifteen equal annual payments of ninety-eight\nmillion five hundred thirty-seven thousand five hundred seven dollars\n($98,537,507) on October fifteenth, commencing on October fifteenth,\nnineteen hundred ninety. Such payments are calculated at an interest\nrate of eight percent per annum. Provided, however, the retirement board\nis directed to permit the pre-payment of the amounts outstanding under\nthis paragraph. The retirement board shall: (1) On or before September\nfirst, nineteen hundred ninety, in addition to the amount due for the\ncurrent fiscal year billing and for the payment of the amortized annual\ninstallment, furnish the total amount due and be authorized to accept\npre-payment in full of said amount by October fifteenth, nineteen\nhundred ninety. (2) On or before each September first thereafter, in\naddition to the amount due for the current fiscal year billing and for\nthe payment of the annual amortized installment, furnish the total\namount still outstanding and be authorized to accept the pre-payment of\nany portion of the balance remaining to be paid by October fifteenth of\nthat year.\n j. Prior to June first, nineteen hundred ninety, the valuation rate of\ninterest adopted by the retirement board on April twenty-seventh,\nnineteen hundred eighty-nine, may be retroactively revised to eight\npercent by the retirement board, as recommended by the actuary, as if\nadopted at the April twenty-seventh, nineteen hundred eighty-nine board\nmeeting, and the employer contribution rate, adopted by the retirement\nboard at the April twenty-seventh, nineteen hundred eighty-nine board\nmeeting, revised by the retirement board at the July twenty-seventh,\nnineteen hundred eighty-nine board meeting, may be retroactively amended\nby the retirement board as if adopted at the July twenty-seventh,\nnineteen hundred eighty-nine board meeting and applied to contributions\npaid in the nineteen hundred ninety--ninety-one fiscal year.\nNotwithstanding any provision of law to the contrary, the actions of the\nretirement board pursuant to the provisions of this paragraph shall be\ndeemed reasonable, prudent and proper. No member of the retirement\nboard, officer, or employee of the New York state teachers' retirement\nsystem shall incur or suffer any liability whatsoever by reason of any\nactions pursuant to this paragraph, and such system shall save harmless\nand indemnify all members of the retirement board, its officers and\nemployees from financial loss arising out of any claim, demand, suit,\naction or judgment as a result of the actions taken pursuant to this\nparagraph provided that such person shall, within five days after the\ndate on which he is served with any summons, complaint, process, notice,\ndemand, claim or pleading, deliver the original or a true copy thereof\nto the legal advisor of such system. Upon such delivery, the legal\nadvisor of such system may assume control of the representation of such\nperson in connection with such claim, demand, suit, action or\nproceeding. Such person shall cooperate fully with the legal advisor of\nthe system or any other person designated to assume such defense in\nrespect of such representation or defense.\n k. The retirement board is authorized to adopt procedures and/or to\npromulgate rules and regulations as it deems necessary to adjust and\nreconcile any payments from employers to actual amounts due whether such\npayments were received prior or subsequent to the effective date of the\nchapter of the laws of nineteen hundred ninety which added this\nparagraph to this section.\n l. The provisions of paragraphs h and i of this subdivision shall\nconstitute a contract and the rights of the New York state teachers'\nretirement system thereunder shall not be impaired in any way\nwhatsoever.\n m. In addition to any other payment or collection procedure provided\nby this article, if the amounts credited from the appropriation for the\nsupport of common schools are insufficient to fully cover the amounts to\nbe contributed by the employers, the retirement board is authorized to\ncertify the unpaid amount to the state comptroller, and the state\ncomptroller shall, to the extent not otherwise prohibited by law,\nwithhold such amount from any succeeding payment from any other form of\nstate aid provided to the employer. If any employer fails to pay the\namounts required to be contributed pursuant to this section, the\nretirement system shall be entitled to reasonable attorney fees and\nother expenses incurred to collect such amounts due and owing. Fees\nshall be determined pursuant to prevailing market rates for the kind and\nquality of the services furnished.\n n. Notwithstanding any other provision of law to the contrary, the\nboard of education or trustees of a school district which is a\nparticipating employer, which has elected to make payments of the\nemployer contributions due and payable to the retirement system pursuant\nto paragraph i of this subdivision in amortized annual installments, and\nwhich has determined to make pre-payment of the total amount of such\ncontributions outstanding in accordance with said paragraph i, may adopt\na bond resolution authorizing the refinancing of such debt by the\nissuance of bonds in the amount of such pre-payment without conducting a\nvote on a tax to be collected in installments, provided that such\nrefinancing will result in savings to the school district, as certified\nby the state comptroller, and provided further that the issuance of such\nobligations otherwise complies with the requirements of the local\nfinance law and this chapter.\n 3. Stable contribution option for participating educational employers\nfor the two thousand thirteen - two thousand fourteen plan year. a. In\naddition to the definitions in section five hundred one of this article,\nwhen used in this subdivision:\n (1) "participating educational employer" shall mean a school district\nor board of cooperative educational services which elects to pay the\nstable contribution amount in the manner provided in this subdivision;\n (2) "stable contribution amount" shall mean an amount equal to the\nstable contribution rate multiplied by the pensionable salary base\n(exclusive of payments for group term life insurance, deficiency\ncontributions, adjustments relating to prior fiscal years' obligations,\nobligations pertaining to retirement incentives or any other obligations\nthat a participating educational employer is permitted to pay on an\namortized basis);\n (3) "stable contribution rate" shall mean fourteen percent for the two\nthousand thirteen - two thousand fourteen plan year and the two thousand\nfourteen - two thousand fifteen plan year and the rate as adopted by the\nretirement board in accordance with paragraph h of this subdivision; and\n (4) "deferred employer contribution amount" shall mean an amount\nadequate to fund the benefits for active and retired members associated\nwith such participating educational employer had such participating\neducational employer not elected the provisions of this subdivision.\nSuch deferred employer contribution amount shall be calculated for each\nyear of participation in the stable contribution option with associated\ninterest determined specific to each applicable plan year's deferred\namount.\n b. Notwithstanding the provisions of this chapter or any other law to\nthe contrary, the retirement board, in its discretion, shall have\nauthority to implement the provisions of this subdivision. If the\nretirement board elects to implement the provisions of this subdivision,\nthe provisions shall apply to the payment of participating educational\nemployer contributions in the plan year commencing July first, two\nthousand thirteen, for the pension bill paid on September fifteenth,\nOctober fifteenth, and November fifteenth of two thousand fourteen, and\nfor the subsequent six plan years. If a participating educational\nemployer does not elect the stable contribution option in the fiscal\nyear commencing on July first, two thousand thirteen for the pension\nbill paid on September fifteenth, October fifteenth, and November\nfifteenth of two thousand fourteen, it shall not be eligible to elect\nthe stable contribution option in any succeeding plan year.\n c. For each of the seven plan years to which the provisions of this\nsubdivision apply, the retirement board shall use a stable contribution\nrate established by the retirement board for participating educational\nemployers.\n d. If the retirement board, in its discretion, decides to adopt a\nstable contribution option pursuant to this subdivision, the retirement\nboard shall determine the stable contribution amount in each plan year\nfor a participating educational employer pursuant to subparagraph two of\nparagraph a of this subdivision. Such stable contribution amount shall\nbe in lieu of a participating educational employer's actuarially\nrequired contribution rate of normal and administrative contributions\npursuant to sections five hundred seventeen and five hundred nineteen of\nthis article for the plan year commencing July first, two thousand\nthirteen, and for the next six subsequent plan years.\n e. Any participating educational employer which elects to pay the\nstable contribution amount pursuant to this subdivision shall pay the\namount based on the stable contribution rate for a period of seven years\nand such option shall be available to participating educational\nemployers from the two thousand thirteen - two thousand fourteen plan\nyear through the two thousand nineteen - two thousand twenty plan year.\nIn the sixth plan year, the two thousand eighteen - two thousand\nnineteen plan year, the participating educational employer shall pay the\nstable contribution rate and, in addition, commence payment for deferred\nemployer contributions in accordance with paragraph j of this\nsubdivision. Commencing with the plan year beginning July first, two\nthousand twenty, the participating educational employer shall resume\npayment of the actuarially required contribution rate of normal and\nadministrative contributions pursuant to sections five hundred seventeen\nand five hundred nineteen of this article and, in addition, any payment\nfor deferred employer contribution amounts in accordance with paragraphs\nj and k of this subdivision.\n f. A participating educational employer paying a stable contribution\namount shall remit, commencing with the July first, two thousand\nthirteen plan year, an amount determined by the retirement board by\nadding the following two amounts together:\n (1) the stable contribution amount calculated pursuant to this\nsubdivision; and\n (2) payments for group term life insurance, deficiency payments,\nadjustments relating to prior fiscal years' obligations and obligations\npertaining to retirement incentives or any other obligations that a\nparticipating educational employer is permitted to pay on an amortized\nbasis.\n g. The stable contribution amount must be paid in full by\nparticipating educational employers on the dates specified in paragraph\nh of subdivision two of this section.\n h. Prior to July first, two thousand fifteen and July first, two\nthousand seventeen the retirement board is authorized to evaluate the\nstable contribution rate used to calculate participating educational\nemployer stable contribution amounts. Such evaluation shall be based on\na projection of assets and liabilities so as to ensure that\ncontributions by participating educational employers which participate\nin the stable contribution option are adequate to ensure that system\nassets are sufficient to fund benefits for active and retired members.\nThe retirement board is authorized to increase the stable contribution\nrate by up to two percentage points on July first, two thousand fifteen\nand on July first, two thousand seventeen. The revised stable\ncontribution rate resulting from the foregoing evaluations and July\nfirst, two thousand fifteen and July first, two thousand seventeen\nstable rate increases may not, in combination, exceed eighteen percent.\nThe retirement board is authorized to decrease the stable contribution\nrate, if warranted, but in no event shall the stable contribution rate\nbe less than fourteen percent.\n i. A participating educational employer may elect to terminate\nparticipation in the stable contribution option and resume payment of\nthe actuarially required contribution of normal and administrative\ncontributions in accordance with sections five hundred seventeen and\nfive hundred nineteen of this article. Provided, however, that such\nparticipating educational employer which elects to terminate\nparticipation shall make a reconciliation contribution to the retirement\nsystem, at an amount to be determined by the retirement board, adequate\nto fund the benefits for active and retired members associated with such\nparticipating educational employer had such participating educational\nemployer not elected the provisions of this subdivision. Such\nreconciliation contribution shall be made over a period not to exceed\nfive years and shall be made in addition to the normal and\nadministrative contributions pursuant to sections five hundred seventeen\nand five hundred nineteen of this article for the plan year in which\nsuch participating educational employer chooses to resume payment of the\nnormal and administrative contributions pursuant to sections five\nhundred seventeen and five hundred nineteen of this article. For the\npurposes of determining the reconciliation contribution amount, the\nretirement board shall assume interest on the deferred employer\ncontribution amount at a rate which approximates the monthly average\nyield on United States treasury securities at ten-year constant maturity\nfor the twelve-month period preceding August first of each year plus one\npercentage point. The interest rate associated with such deferred\nemployer contribution amount shall be specific to each applicable plan\nyear's deferred amount.\n j. In the sixth plan year, commencing July first, two thousand\neighteen, all participating educational employers having elected the\nstable contribution option shall continue to contribute the stable\ncontribution amount to the retirement system and remit to the retirement\nsystem the accrued deferred employer contributions accumulated in the\nfirst five plan years. The stable payment of the deferred employer\ncontribution accrued by the participating educational employer shall be\npaid to the retirement system in equal annual installments over a\nfive-year period, with interest on the unpaid portion to be based on the\nmonthly average yield on United States treasury securities at a ten-year\nconstant maturity for the twelve-month period preceding August first of\neach year plus one percentage point. The interest rate associated with\nsuch deferred employer contribution amount shall be specific to the rate\nas measured on August first of the applicable plan year to such deferred\namount. Payments of the stable installments shall be made in the same\nmanner as other employer contributions as prescribed in this article.\nNothing in this subdivision shall be construed as prohibiting such\nparticipating educational employer from making a reconciliation\ncontribution in accordance with paragraph i of this subdivision.\n k. In the eighth plan year, commencing July first, two thousand\ntwenty, all participating educational employers having elected the\nstable contribution option shall resume payment of the actuarially\nrequired contribution rate of normal and administrative contributions in\naccordance with section five hundred seventeen and five hundred nineteen\nof this article. Additionally, such employer will remit to the\nretirement system the accrued deferred employer contributions\naccumulated during the plan years commencing July first, two thousand\neighteen and July first, two thousand nineteen of the stable\ncontribution option. The stable payment of the deferred employer\ncontribution accrued by the participating educational employer shall be\npaid to the retirement system in equal annual installments over a\nfive-year period with interest on the unpaid portion to be based on the\nmonthly average yield on United States treasury securities at a ten-year\nconstant maturity for the twelve-month period preceding August first of\neach year plus one percentage point. The interest rate associated with\nsuch deferred employer contribution amount shall be specific to the rate\nas measured on August first of the applicable plan year to such deferred\namount. Payments of the stable installments shall be made in the same\nmanner as other employer contributions as prescribed in this article.\nNothing in this subdivision shall be construed as prohibiting such\nparticipating educational employer from making a reconciliation\ncontribution in accordance with paragraph i of this subdivision.\n l. Notwithstanding the provisions of this subdivision, if the\nretirement board decides to adopt a stable contribution option, in\naccordance with this subdivision, and the funded status of the\nretirement system reaches a threshold below eighty percent at the end of\nany plan year during the seven plan year term of this option, the option\nshall cease and participating educational employers who have elected the\nstable contribution option shall resume payment of the actuarially\nrequired contribution rate of normal and administrative contributions in\naccordance with section five hundred seventeen and five hundred nineteen\nof this article. Additionally, such employer will make a reconciliation\ncontribution to the retirement system, at an amount to be determined by\nthe retirement board, adequate to fund the benefits for active and\nretired members associated with such participating educational employer\nhad such participating educational employer not elected the provisions\nof this section. The payment of the deferred employer contribution\naccrued by the participating educational employer shall be paid to the\nretirement system in equal annual installments over a five-year period\nwith interest on the unpaid portion to be based on the monthly average\nyield on United States treasury securities at a ten-year constant\nmaturity for the twelve-month period preceding August first of each year\nplus one percentage point. The interest rate associated with such\ndeferred employer contribution amount shall be specific to the rate as\nmeasured on August first of the applicable plan year to such deferred\namount. Payments of the stable installments shall be made in the same\nmanner as other employer contributions as prescribed in this article.\n m. The retirement board is authorized to promulgate rules and\nregulations for implementation of this subdivision.\n