§ 313 — Management of funds

§ 313. Management of funds. a. The funds of the police and fire\nretirement system shall be managed in accordance with this section.\n b. The comptroller shall be trustee of the several funds of the police\nand fire retirement system. Such funds shall be invested by the\ncomptroller in securities in which he or she is authorized by law to\ninvest the funds of the state, except that he or she may invest in\nobligations consisting of notes, bonds, debentures or equipment trust\ncertificates issued under an indenture, which are the direct obligations\nof, or in the case of equipment trust certificates are secured by direct\nobligations of, a railroad or industrial corporation, or a corporation\nengaged directly and primarily in the production, transportation,\ndistribution, or sale of electricity, or gas, or the operation of\ntelephone or telegraph systems or waterworks, or in some combination of\nthem; provided the obligor corporation is one which is incorporated\nunder the laws of the United States, or any state thereof, or of the\nDistrict of Columbia, and said obligations shall be rated at the time of\npurchase within the three highest classifications established by at\nleast two standard rating services. The maximum amount that the\ncomptroller may invest in such obligations shall not exceed thirty per\ncentum of the assets of the New York state police and fire retirement\nsystem's funds; and provided further that not more than two and one-half\nper centum of the assets of the New York state police and fire\nretirement system's funds shall be invested in the obligations of any\none corporation of the highest classification and subsidiary or\nsubsidiaries thereof, that not more than two per centum of the assets of\nthe New York state police and fire retirement system's funds shall be\ninvested in the obligations of any one corporation of the second highest\nclassification and subsidiary or subsidiaries thereof, that not more\nthan one and one-half per centum of the assets of the New York state\npolice and fire retirement system's funds shall be invested in the\nobligations of any one corporation of the third highest classification\nand subsidiary or subsidiaries thereof. He or she shall, however, be\nsubject to all terms, conditions, limitations and restrictions imposed\nby this article and by law upon the making of such investments. The\ncomptroller shall have full power:\n 1. To hold, purchase, sell, assign, transfer or dispose of any of the\nsecurities or investments, in which any of the funds of the police and\nfire retirement system shall be invested, including the proceeds of such\ninvestments and any monies belonging to such funds, and\n 2. In his or her name as trustee, to foreclose mortgages upon default\nor to take title to real property in such proceedings in lieu thereof\nand to lease and sell real property so acquired.\n c. The comptroller annually shall credit to each of the funds of the\npolice and fire retirement system regular interest on the mean amount\ntherein for the preceding year.\n d. The custody of all funds of the police and fire retirement system\nshall be in the charge of the head of the division of the treasury of\nthe department of taxation and finance, subject to the supervision and\ncontrol of the commissioner of taxation and finance.\n e. Payment of all pensions, annuities and other benefits shall be made\nas provided in this article. For the purpose of meeting disbursements\nfor pensions, annuities and other payments ordered by the comptroller,\nthe head of such division may keep on deposit an available fund which\nshall not exceed ten per centum of the total amount of the several funds\nof the police and fire retirement system. Every such deposit shall be\nkept only in a bank or trust company organized under the laws of this\nstate, or in a national bank located in this state, which shall furnish\nadequate security therefor.\n f. The comptroller, however, shall have a fund in his or her immediate\npossession. Such fund shall be used for the immediate payment of:\n 1. All pensions, annuities and other benefits, and\n 2. Such expenses as may necessarily be incurred in acquiring,\nservicing and foreclosing mortgages and in acquiring, managing and\nprotecting investments, and\n 3. Such special expenditures for which the police and fire retirement\nsystem will be paid by the state or a participating employer. Such fund\nshall be reimbursed from time to time by the head of such division on\nthe warrant of the comptroller.\n g. Neither the comptroller nor any person employed on the work of the\npolice and fire retirement system shall:\n 1. Except as herein provided, have any interest, direct or indirect,\nin the gains or profits of any investment of the police and fire\nretirement system, nor, in connection therewith, directly or indirectly,\nreceive any pay or emolument for his or her services.\n 2. Except as provided in section three hundred fifty of this article:\n (a) Directly or indirectly, for himself or herself or as an agent or\npartner of others, borrow any of its funds or deposits or in any manner\nuse the same except to make such current and necessary payments as are\nauthorized by the comptroller, or\n (b) Become an endorser, surety or an obligor in any manner of monies\nloaned by or borrowed of such funds.\n h. The police and fire retirement system may use a part of its funds,\nnot exceeding ten per centum of its assets, (1) for purchasing or\nleasing of land in the city of Albany and the construction thereon of a\nsuitable office building or buildings for the transaction of the\nbusiness of the retirement system, (2) for purchasing or leasing of land\nin the cities of Albany, Syracuse, Buffalo, Binghamton, New York,\nRochester and Utica and the construction thereon of a suitable office\nbuilding or buildings for purposes of lease or sale to the state, (3)\nfor purchasing or leasing of land in the city of Albany on the north and\nsouth sides of Washington avenue commonly known as the "Campus Site"\nacquired by the state for a state building site pursuant to the\nprovisions of chapter five hundred seventy-two of the laws of nineteen\nhundred forty-seven and the construction thereon of power plants\nincluding service connections, electric substations including service\nconnections, garages, warehouses and restaurant facilities deemed\nnecessary for the efficient and economical operation of the office\nbuilding or buildings constructed on such land and (4) for purchasing or\nleasing of land in the city of Albany acquired by the state for suitable\nparking facilities for the use primarily of employees of the state and\npersons having business with state departments and state agencies and\nthe construction thereon of such structures, appurtenances and\nfacilities deemed necessary for the efficient and economical operation\nof the parking facilities constructed on such land and (5) for\npurchasing or leasing of land in locations approved by the state\nuniversity trustees and the construction, acquisition, reconstruction,\nrehabilitation or improvement of suitable buildings or facilities\nthereon for purposes of lease or sale to the state university\nconstruction fund, such buildings or facilities to be used by the state\nuniversity or by state-operated institutions or statutory or contract\ncolleges under the jurisdiction of the state university or by the\nstudents, faculty and staff of the state university or of any such\nstate-operated institution or statutory or contract college, and their\nfamilies.\n The police and fire retirement system from time to time may lease to\nany public agency any portion of a building constructed for the\ntransaction of its business which may not be required for such purpose,\nupon such terms and conditions as shall be deemed to be for the best\ninterest of the police and fire retirement system.\n Real property of the police and fire retirement system acquired or\nconstructed pursuant to this subdivision shall be exempt from taxation.\n i. At the close of each fiscal year, the average rate of investment\nearnings of the retirement system shall be computed by the actuary and\ncertified to the comptroller. This rate shall be determined from the\ninvestment earnings during the calendar year which ended three months\nprior to the close of the fiscal year. For any year that such average\nrate of earnings is in excess of three per centum but not in excess of\nfour per centum, the comptroller shall declare a rate of special\ninterest, for members earning regular interest of three per centum,\nequal to the difference between such average rate of earnings and three\nper centum, expressed to the lower one-tenth of one per centum, but not\nin excess of one per centum. For any year, commencing with the fiscal\nyear the first day of which is April first, nineteen hundred seventy,\nthat such average rate of earnings is in excess of four per centum, the\nspecial rate of interest for members earning regular interest of three\nper centum shall be equal to the difference between such average rate of\nearnings and three per centum, expressed to the lower one-tenth of one\nper centum, but not in excess of two per centum, and for members earning\nregular interest of four per centum, it shall be the difference between\nsuch average rate of earnings and four per centum, expressed to the\nlower one-tenth of one per centum, but not in excess of one per centum.\nSpecial interest at such rates, shall be credited, by the comptroller at\nthe same time that regular interest is credited, to the individual\nannuity savings accounts of persons who are members as of the close of\nthe fiscal year. Special interest shall not be considered in determining\nrates of contribution of members. In the case of persons who last became\nmembers on or after July first, nineteen hundred seventy-three, the\nprovisions of this subdivision shall apply only to the fiscal years\nbeginning April first, nineteen hundred seventy-two and ending March\nthirty-first, nineteen hundred seventy-three.\n j. The retirement system may invest, within the limitations authorized\nfor investments in conventional mortgages, a part of its funds in first\nmortgages on real property located anywhere within the boundaries of the\nUnited States and leased to the government of the United States,\nprovided however, that no such investment shall be made unless the terms\nof the mortgage shall provide for amortization payments in an amount\nsufficient to completely amortize the loan within the period of the\nlease.\n