Section 13-701
§ 13-701 Investments by pension funds or retirement systems
maintained, administered or supported by the city or an agency, in notes
or bonds secured by certain purchase money mortgages. a. The trustee or
trustees of a pension fund or retirement system maintained, administered
or supported by the city or an agency or by city funds may invest the
funds of such pension fund or retirement system in any notes or bonds
secured by purchase money mortgages accepted by the city at the time of
the sale of real property acquired by virtue of tax enforcement
foreclosure proceedings or by deed in lieu thereof, and any other notes
or bonds secured by purchase money mortgages accepted by the city,
provided however, no such other note or bond may be purchased by said
trustee or trustees at a price in excess of two-thirds of the selling
price of the real property secured by such purchase money mortgage at
the time of its execution in connection with a sale resulting from a
public auction of such real property, without regard to any limitations
or restrictions contained in this code or in the provisions of article
four-a of the retirement and social security law or section two hundred
thirty-five of the banking law or any other law and in addition to the
powers conferred by any such law. The aggregate unpaid principal amount
of bonds and notes secured by such mortgages held at any time in such a
fund or system shall not exceed two per centum of the assets of such
fund or system. Any assignment of such a note or bond and mortgage to a
pension fund or retirement system pursuant to this section shall contain
a provision that if property which is collateral security for such bond
or note and mortgage shall be acquired by the City of New York as a
result of a foreclosure in rem proceeding and/or if a deficiency
judgment is obtained by such fund or system by reason of a default under
the terms of the note or bond and mortgage, the city will reimburse such
fund or system by payment to said pension fund or retirement system of
the amounts due under such note or bond and mortgage, including
principal, interest, and any costs and expenses involved in obtaining
such deficiency judgment by appropriation in the annual expense budget,
provided that (1) the trustee or trustees of such pension fund or
retirement system shall certify and include the amounts due, including
principal, interest, and any costs and expenses, in the annual estimate
of the requirements of such fund or system submitted to the director of
the budget pursuant to charter section one hundred fourteen; and (2)
upon the effective date of the budget containing the appropriation for
such amounts due as specified herein, the trustee or trustees of such
fund or system shall assign any deficiency judgment thus obtained to the
city.
b. Nothing contained in this section shall be construed to affect any
lawful investment made prior to the effective date of this section by
the trustee or trustees of any such fund or system, and any such
investment may be retained or disposed of by such trustee or trustees in
accordance with any other provision of law.
c. Notwithstanding any other provision in this section, or any other
law, a pension fund or retirement system in connection with any note or
bond and mortgage heretofore or hereafter acquired by it pursuant to
this section may, where there has occurred or shall occur a default
under the terms of any such note or bond and mortgage, for a period of
one year, tender an assignment of such note or bond or mortgage to the
city of New York. The city shall accept the same and pay said pension
fund or retirement system the amounts due under such note or bond and
mortgage including principal, interest and any costs involved in
effectuating such assignment. A bond or note and mortgage assigned by
the city of New York to a pension fund or retirement system shall be
subject to the provisions of this subdivision c and in the future any
such assignment shall contain a clause to such effect. The provisions of
this section shall only relate to and be binding between the city of New
York and the said pension fund or retirement system and shall not inure
to the benefit of any other person, party or entity.
d. In addition to the provisions and remedies set forth in
subdivisions a, b and c of this section, a pension fund or retirement
system may tender to the city of New York a deed of title to property to
which it had acquired title and which had been subject to a vote or bond
and mortgage which had been assigned to it pursuant to the aforesaid
subdivisions. The said city shall accept the deed and pay to the pension
fund or retirement system as consideration therefor, the principal that
was due under such note or bond and mortgage with interest thereon from
the due date of the principal to the date of delivery of the deed to the
city, together with any costs and expenditures incurred by the said
pension fund or retirement system in acquiring the title and conveying
it to said city.
e. The intent of this section is to reimburse and make whole the
pension funds or retirement systems against any loss incurred by reason
of the investments in the purchase money mortgages as described in this
section.
Section 13-702
§ 13-702 Delegation of investing powers to comptroller. a.
Notwithstanding any provisions of the code or any other law to the
contrary, the trustee, trustees, or other officer, board or body having
the power to invest the funds of a pension fund or retirement system
maintained, administered, or supported by the city or an agency, or by
city funds may delegate such power either in its entirety or with any
limitations including limitations with respect to the type and amount of
investments, to the comptroller. Such delegation shall be in writing,
and shall be filed in the office of such trustee, trustees, officer,
board or body making such delegation, and in the office of the
comptroller. Every such delegation shall be effective for a period
specified therein, not to exceed one year, and shall automatically
terminate and expire at the end of such specific period. Renewals or new
delegations may be granted for additional periods in the same manner as
herein provided for original delegations, but each such renewal or new
delegation shall be effective for a specified period, not to exceed one
year. Upon the filing of such delegation or renewal thereof as herein
prescribed the comptroller shall, subject to the terms of such
delegation, have the power:
1. To make any investment which the trustee, trustees, officer, board
or body delegating such power is or are authorized by law to make;
2. To hold, sell, assign, transfer or dispose of any of the
properties, securities or investments in which any of the funds of said
fund or system shall have been invested, including the proceeds of such
investments and any moneys belonging to such funds, subject to the
terms, conditions, limitations and restrictions imposed by law upon such
trustee, trustees, officer, board or body delegating such power; and
3. In his or her name as agent of such trustee, trustees, officer,
board or body making such delegation and of such fund or system, to
foreclose mortgages upon default or to take title to real property in
such proceedings in lieu thereof or to lease and sell such property so
acquired.
b. The comptroller shall exercise any power delegated pursuant to this
section until the expiration date specified in such delegation or any
renewal thereof unless the trustee, trustees, officer, board, or body
making such delegation shall sooner elect to reassume such power by
filing a written revocation of the delegation in the office of such
trustee, trustees, officer, board or body and in the office of the
comptroller.
c. Notwithstanding any other provision of this section, the
termination, expiration or revocation of any delegation of power or
renewal thereof, as herein provided, shall not affect any binding
commitment previously made by the comptroller pursuant to such
delegation and the comptroller shall have the power to fully discharge
any such binding commitment according to its terms.
Section 13-703
§ 13-703 Investments in railroad, industrial, electric and gas,
telephone and waterworks obligations. Notwithstanding the provisions of
the code or any other law to the contrary, the trustee, trustees or
other officer, board or body having the power to invest the funds of a
pension fund or retirement system maintained, administered, or supported
by the city or an agency, or by city funds, may, in addition, invest in
obligations consisting of notes, bonds, debentures or equipment trust
certificates issued under an indenture which are the direct obligations
of, or in the case of equipment trust certificates, are secured by the
direct obligations of, a railroad or industrial corporation, or a
corporation engaged directly and primarily in the production,
transportation, distribution or sale of electricity or gas, or the
operation of telephone or telegraph systems or waterworks, or in some
combination of them; provided the obligor corporation is one which is
incorporated under the laws of the United States, or any state thereof,
of the District of Columbia, and said obligations shall be rated at the
time of purchase within the three highest classifications established by
at least two standard rating services. The maximum amount that they may
invest in such obligations pursuant to this subdivision shall not exceed
ten per centum of the assets of a fund; and provided further that of
said ten per centum not more than two per centum of the assets of a fund
shall be invested in the obligations of any one corporation of the
highest classification and subsidiary or subsidiaries thereof, that not
more than one and one-half per centum of the assets of a fund shall be
invested in the obligations of any one corporation of the second highest
classification and subsidiary or subsidiaries thereof, that not more
than one per centum of the assets of a fund shall be invested in the
obligations of any one corporation of the third highest classification
and subsidiary or subsidiaries thereof.
Section 13-704
§ 13-704 Graduated crediting of gains and amortization of losses on
dispositions of securities by certain retirement systems. a. As used in
this section, the following terms shall mean and include:
1. "Retirement system". Any of the following: the New York city
employees' retirement system; the teachers' retirement system; the
police pension fund provided for by subchapter two of chapter two of
this title; the fire department pension fund provided for by subchapter
two of chapter three of this title; and the board of education
retirement system of the city.
2. "Teachers' retirement system". The retirement system of the
teachers' retirement association provided for by chapter four of this
title.
3. "Contingent reserve fund". The contingent reserve fund of a
retirement system; provided, however, that such term, where used in
relation to public employer contributions payable to the fire department
pension fund subchapter two during any period preceding the starting
date of the improved benefits plan, as defined in subdivision
twenty-seven of section 13-313 of this title, shall mean the retirement
allowance accumulation fund provided for by section 13-325 of this
title, as in effect before such starting date.
4. "Responsible public employer". The city and in any case where the
state or any public authority, corporation, body corporate or entity is
required by any provision of this title or any other law to make
contributions to a retirement system on behalf of any members thereof,
such term, as applicable to such retirement system, shall mean,
collectively, the city, the state and each such authority, corporation,
body corporate and entity; subject, however, to the mutual rights,
obligations and responsibilities in relation to such retirement system,
as prescribed by law, of the city, the state and such authority,
corporation, body corporate or entity.
5. "Retirement system act". (a) In the case of the New York city
employees' retirement system, such term shall mean chapter one of this
title.
(b) In the case of the teachers' retirement system, such term shall
mean chapter four of this title.
(c) In the case of the police pension fund, article two, such term
shall mean subchapter two of chapter two of this title.
(d) In the case of the fire department pension fund subchapter two,
such term shall mean subchapter two of chapter three of this title.
(e) In the case of the board of education retirement system, such term
shall mean the rules and regulations of such retirement system and
subdivisions sixteen, seventeen and eighteen of section twenty-five
hundred seventy-five of the education law.
6. "Securities". Bonds, obligations, and mortgages which constitute
lawful investments for a retirement system.
7. "Sell". To carry out a transaction whereby a retirement system
transfers title to any securities which it holds, or exchanges or
otherwise disposes of any such securities.
8. "Sale". The carrying out of any transaction described in paragraph
seven of this subdivision a.
b. (1) Notwithstanding any other provision of law to the contrary, the
provisions of paragraph two of this subdivision shall apply in any case
where, on or after May twentieth, nineteen hundred seventy and prior to
July first, nineteen hundred eighty-eight:
(i) a retirement system sells securities in which any of its funds are
invested; and
(ii) realizes a gain or sustains a loss with respect to such sale; and
(iii) under the retirement system act governing such retirement
system, the responsible public employer is entitled to credit for any
such gain in the determination of its required contributions to such
retirement system, or is required to reimburse such retirement system
for any such loss.
(2) Such gain or loss shall be treated in the manner prescribed by the
applicable provisions of subdivisions c, d, e, f and g of this section.
c. (1) If any such sale occurring in the city's nineteen hundred
sixty-nine--nineteen hundred seventy fiscal year or in any subsequent
fiscal year up to and including the nineteen hundred
seventy-nine--nineteen hundred eighty fiscal year results in a gain, the
amount of such gain shall be credited in favor of the responsible public
employer with respect to such retirement system, pursuant to the
applicable provisions of paragraphs two to eight inclusive, of this
subdivision c, in relation to the required contributions of such
responsible public employer to such retirement system.
(2) If any such gain referred to in paragraph two of this subdivision
c was realized in the city's nineteen hundred sixty-nine--nineteen
hundred seventy fiscal year or in any subsequent city fiscal year up to
and including the nineteen hundred seventy-eight--nineteen hundred
seventy-nine fiscal year, there shall be computed twenty equal annual
installments of credit, the aggregate of which, if one of such
installments were credited in favor of such responsible public employer
in each of the twenty city fiscal years commencing with the second
fiscal year succeeding the fiscal year in which such gain was realized,
would be the actuarial equivalent of the amount of such gain. For the
purpose of making such computation with respect to any such gains
realized prior to July first, nineteen hundred seventy-five, an interest
rate of four per centum per annum shall be used and for the purpose of
making such computation with respect to any such gains realized during
the period beginning on July first, nineteen hundred seventy-five and
ending on June thirtieth, nineteen hundred seventy-nine, an interest
rate of five and one-half per centum per annum shall be used.
(3) In the case of any such gain referred to in paragraph one of this
subdivision c which was realized in any city fiscal year occurring
during the period beginning on July first, nineteen hundred sixty-nine
and ending on June thirtieth, nineteen hundred seventy-eight, the first
of such installments shall be credited in favor of such responsible
public employer in the second city fiscal year succeeding that in which
such gain was realized and one such installment shall be so credited in
each succeeding fiscal year to and including the nineteen hundred
seventy-nine--nineteen hundred eighty fiscal year. Such crediting in any
such fiscal year shall be effected with respect to any such retirement
system in the manner prescribed by the provisions of this section and of
the retirement system act governing such retirement system, as such
provisions were in effect during such fiscal year.
(4) With respect to each gain to which paragraph two of this
subdivision c applies, there shall be computed the present value, as of
June thirtieth, nineteen hundred eighty, of the annual installments of
credit thereon remaining uncredited as of such June thirtieth. For the
purpose of making such calculation, an interest rate of five and
one-half per centum shall be used.
(5) With respect to each present value computed pursuant to paragraph
four of this subdivision c, there shall be computed a number of equal
annual installments of credit in favor of the responsible public
employer, which number shall equal one less than the number of such
uncredited installments referred to in such paragraph four, and the
aggregate of which computed installments, on the basis of crediting the
first of such installments to such responsible public employer in the
city's nineteen hundred eighty--nineteen hundred eighty-one fiscal year
and one of such installments in each subsequent fiscal year until all of
such installments are so credited, shall be the actuarial equivalent of
such present value referred to in such paragraph four. For the purpose
of making such computation, an interest rate of seven and one-half per
centum per annum shall be used.
(6) (a) One of such installments computed pursuant to paragraph five
of this subdivision c shall be credited in favor of such responsible
public employer in each of the city's nineteen hundred eighty--nineteen
hundred eighty-one and nineteen hundred eighty-one--nineteen hundred
eighty-two fiscal years.
(b) (i) In each city fiscal year occurring during the period beginning
on July first, nineteen hundred eighty-two and ending on June thirtieth,
nineteen hundred eighty-eight, there shall be credited in favor of such
responsible public employer an installment computed in accordance with
items (ii) and (iii) of this subparagraph (b).
(ii) With respect to each present value computed pursuant to paragraph
four of this subdivision c, there shall be computed as of June
thirtieth, nineteen hundred eighty-two, using an interest rate of seven
and one-half per centum per annum, the present value of the annual
installments of credit in favor of the responsible public employer
determined in accordance with paragraph five of this subdivision c and
allocated to fiscal years subsequent to June thirtieth, nineteen hundred
eighty-two.
(iii) The annual installments to be credited, for each city fiscal
year occurring during the period beginning on July first, nineteen
hundred eighty-two and ending on June thirtieth, nineteen hundred
eighty-eight, in respect of each present value computed in accordance
with item (ii) of this subparagraph (b) shall be an amount which, when
credited in equal annual installments commencing with the city's
nineteen hundred eighty-two--nineteen hundred eighty-three fiscal year
and continuing for the number of fiscal years equal to the number of
installments used in computing such present value, would be the
actuarial equivalent, as of June thirtieth, nineteen hundred eighty-two
on the basis of eight per centum interest per annum, of an amount equal
to such present value.
(iv) (A) As used in this item (iv), the term "remaining uncredited
installments as of July first, nineteen hundred eighty-eight" shall
mean, in relation to any gain referred to in paragraph two of this
subdivision c, the number of installments, if any, obtained by
subtracting eight installments from the number of installments computed
pursuant to paragraph five of this subdivision c in relation to such
gain.
(B) There shall be computed, as of June thirtieth, nineteen hundred
eighty-eight, using an interest rate of eight per centum per annum, the
present value of the remaining uncredited installments as of July first,
nineteen hundred eighty-eight, if any, with respect to any such gain
referred to in paragraph two of this subdivision.
(C) The annual installments to be credited with respect to such gain
in each city fiscal year occurring during the period beginning on July
first, nineteen hundred eighty-eight and ending with the last day of a
number of fiscal years equal to the number of remaining uncredited
installments as of July first, nineteen hundred eighty-eight with
respect to such gain, shall be an amount which, when credited in equal
annual installments, commencing with the city's nineteen hundred
eighty-eight--nineteen hundred eighty-nine fiscal year and continuing
during each fiscal year of the period above mentioned in this sub-item
(C), shall be the actuarial equivalent, as of June thirtieth, nineteen
hundred eighty-eight on the basis of eight and one-quarter per centum
interest per annum, of such present value computed pursuant to sub-item
(B) of this item (iv).
(7) (a) If any such gain referred to in paragraph one of this
subdivision c was realized in the city's nineteen hundred seventy-nine--
nineteen hundred eighty fiscal year, the amount of such gain shall,
beginning with the nineteen hundred eighty--nineteen hundred eighty-one
fiscal year, be credited in favor of such responsible public employer in
twenty successive equal annual installments determined in the manner
provided for by subparagraphs (b), (c) and (d) of this paragraph seven.
(b) The first and second annual installments referred to in
subparagraph (a) of this paragraph seven shall be determined so that if
they were the first and second of twenty equal annual installments of
the amount of such gain, the present value of such twenty equal annual
installments, computed at an interest rate of seven and one-half per
centum per annum, would be equal to the amount of such gain.
(c) The next six annual installments required to be credited under the
provisions of subparagraph (a) of this paragraph seven shall be
determined so as to be equal and so that the present value of such six
equal annual installments, computed as of June thirtieth, nineteen
hundred eighty-two at an interest rate of eight per centum per annum as
if they were part of a remainder of eighteen equal annual installments
so computed, shall be equal to the present value, computed as of such
June thirtieth at an interest rate of seven and one-half per centum per
annum, of the corresponding next six of the twenty equal annual
installments computed pursuant to the provisions of subparagraph (b) of
this paragraph seven.
(d) The remaining twelve annual installments required to be credited
under the provisions of subparagraph (a) of this paragraph seven shall
be determined so as to be equal and so that the present value of such
twelve equal annual installments, computed as of June thirtieth,
nineteen hundred eighty-eight at an interest rate of eight and
one-quarter per centum per annum, shall be equal to the present value,
computed as of such June thirtieth at an interest rate of eight per
centum per annum, of such last twelve equal annual installments.
d. (1) If any such sale occurring in the city's nineteen hundred
sixty-nine--nineteen hundred seventy fiscal year or in any subsequent
fiscal year up to and including the nineteen hundred seventy-nine--
nineteen hundred eighty fiscal year results in a loss, the responsible
public employer with respect to such retirement system shall make
payments to the contingent reserve fund of such retirement system on
account of such loss in the manner prescribed by paragraphs two to
seven, inclusive, of this subdivision d.
(2) If any such loss referred to in paragraph one of this subdivision
d was sustained in the city's nineteen hundred sixty-nine--nineteen
hundred seventy fiscal year or in any subsequent city fiscal year up to
and including the nineteen hundred seventy-eight--nineteen hundred
seventy-nine fiscal year, there shall be computed twenty equal annual
installments of payment on account of such loss, the aggregate of which
installments, if one of such installments were paid by such responsible
public employer to the contingent reserve fund in each of the twenty
city fiscal years commencing with the second fiscal year succeeding the
fiscal year in which such loss occurred, would be the actuarial
equivalent of the amount of such loss. For the purpose of making such
computation with respect to losses which occurred prior to July first,
nineteen hundred seventy-five, an interest rate of four per centum per
annum shall be used and for the purpose of making such computation with
respect to losses which occurred during the period beginning on July
first, nineteen hundred seventy-five and ending on June thirtieth,
nineteen hundred seventy-nine, an interest rate of five and one-half per
centum per annum shall be used.
(3) In the case of any such loss referred to in paragraph one of this
subdivision d which was sustained in any city fiscal year occurring
during the period beginning on July first, nineteen hundred sixty-nine
and ending on June thirtieth, nineteen hundred seventy-eight, one of
such installments shall be paid by such responsible public employer to
the contingent reserve fund of such retirement system in the second city
fiscal year succeeding that in which such loss was sustained and one
such installment shall be so paid by such responsible public employer in
each succeeding fiscal year to and including the nineteen hundred
seventy-nine--nineteen hundred eighty fiscal year.
(4) With respect to each loss to which paragraph two of this
subdivision d applies, there shall be computed the present value, as of
June thirtieth, nineteen hundred eighty, of the annual installments of
such loss remaining unpaid by such responsible public employer as of
such June thirtieth. For the purpose of making such calculation, an
interest rate of five and one-half per centum per annum shall be used.
(5) With respect to each present value computed pursuant to paragraph
four of this subdivision d, there shall be computed a number of equal
annual installments of loss to be paid by such responsible public
employer to the contingent reserve fund, which number shall equal one
less than the number of the unpaid installments of such loss to which
such present value relates, and the aggregate of which computed
installments, on the basis of payment of the first of such installments
by such responsible public employer in the city's nineteen hundred
eighty--nineteen hundred eighty-one fiscal year and one of such
installments in each subsequent fiscal year until all of such
installments are paid, shall be the actuarial equivalent of such present
value. For the purpose of making such computation, an interest rate of
seven and one-half per centum per annum shall be used.
(6) (a) Such responsible public employer shall pay one of such
installments computed pursuant to paragraph five of this subdivision d
to the contingent reserve fund of such retirement system in each of the
city's nineteen hundred eighty--nineteen hundred eighty-one and nineteen
hundred eighty-one--nineteen hundred eighty-two fiscal years.
(b) (i) Such responsible public employer, in each city fiscal year
occurring during the period beginning on July first, nineteen hundred
eighty-two and ending on June thirtieth, nineteen hundred eighty-eight,
shall pay an installment computed in accordance with items (ii) and
(iii) of this subparagraph (b).
(ii) With respect to each present value computed pursuant to paragraph
four of this subdivision d, there shall be computed as of June
thirtieth, nineteen hundred eighty-two, using an interest rate of seven
and one-half per centum per annum, the present value of the annual
installments of loss determined in accordance with paragraph five of
this subdivision d and allocated to fiscal years subsequent to June
thirtieth, nineteen hundred eighty-two.
(iii) The annual installments of loss required to be paid by such
responsible public employer, for each city fiscal year occurring during
the period beginning on July first, nineteen hundred eighty-two and
ending on June thirtieth, nineteen hundred eighty-eight, in respect of
each present value computed in accordance with item (ii) of this
subparagraph (b) shall be the applicable installments of an amount
which, if paid in equal annual installments commencing with the city's
nineteen hundred eighty-two--nineteen hundred eighty-three fiscal year
and continuing for the number of fiscal years equal to the number of
installments used in computing such present value, would be the
actuarial equivalent, as of June thirtieth, nineteen hundred eighty-two
on the basis of eight per centum interest per annum, of an amount equal
to such present value.
(iv) (A) As used in this item (iv), the term "remaining unpaid
installments as of July first, nineteen hundred eighty-eight" shall
mean, in relation to any loss referred to in paragraph two of this
subdivision d, the number of installments, if any, obtained by
subtracting eight installments from the number of installments computed
pursuant to paragraph five of this subdivision d in relation to such
loss.
(B) There shall be computed, as of June thirtieth, nineteen hundred
eighty-eight, using an interest rate of eight per centum per annum, the
present value of the remaining unpaid installments as of July first,
nineteen hundred eighty-eight, if any, with respect to any such loss
referred to in paragraph two of this subdivision.
(C) The annual installments to be paid with respect to such loss in
each city fiscal year occurring during the period beginning on July
first, nineteen hundred eighty-eight and ending with the last day of a
number of fiscal years equal to the number of remaining unpaid
installments as of July first, nineteen hundred eighty-eight with
respect to such loss, shall be an amount which, when paid in equal
annual installments, commencing with the city's nineteen hundred
eighty-eight--nineteen hundred eighty-nine fiscal year and continuing
during each fiscal year of the period above mentioned in this sub-item
(C), shall be the actuarial equivalent, as of June thirtieth, nineteen
hundred eighty-eight on the basis of eight and one-quarter per centum
interest per annum, of such present value computed pursuant to sub-item
(B) of this item (iv).
(7) (a) If any such loss referred to in paragraph one of this
subdivision was sustained in the city's nineteen hundred
seventy-nine--nineteen hundred eighty fiscal year, such responsible
public employer shall, beginning with the nineteen hundred
eighty--nineteen hundred eighty-one fiscal year, pay to the contingent
reserve fund of such retirement system on account of such loss, twenty
successive equal annual installments in amounts determined in the manner
provided for in subparagraphs (b), (c) and (d) of this paragraph seven.
(b) The first and second annual installments referred to in
subparagraph (a) of this paragraph seven shall be determined so that if
they were the first and second of twenty equal annual installments of
the amount of such loss, the present value of such twenty equal annual
installments, computed at an interest rate of seven and one-half per
centum per annum, would be equal to the amount of such loss.
(c) The next six annual installments required to be paid under the
provisions of subparagraph (a) of this paragraph seven shall be
determined so as to be equal and so that the present value of such six
equal annual installments, computed as of June thirtieth, nineteen
hundred eighty-two at an interest rate of eight per centum per annum as
if they were a part of a remainder of eighteen equal annual installments
so computed, shall be equal to the present value, computed as of June
thirtieth at an interest rate of seven and one-half per centum per
annum, of the corresponding next six of the twenty equal annual
installments computed pursuant to the provisions of subparagraph (b) of
this paragraph seven.
(d) The remaining twelve annual installments required to be paid under
the provisions of subparagraph (a) of this paragraph seven shall be
determined so as to be equal and so that the present value of such
twelve equal annual installments, computed as of June thirtieth,
nineteen hundred eighty-eight at an interest rate of eight and
one-quarter per centum per annum, shall be equal to the present value,
computed as of such June thirtieth at an interest rate of eight per
centum per annum, of such last twelve equal annual installments.
e. (1) In the case of sales occurring in the city's nineteen hundred
eighty--nineteen hundred eighty-one fiscal year or in any subsequent
fiscal year ending before July first, nineteen hundred eighty-eight, the
retirement system making such sales shall, with respect to any such
fiscal year above specified in this paragraph, provide credit for
realized gains and amortization of realized losses for each responsible
public employer pursuant to the applicable provisions of paragraphs two
and three of this subdivision e.
(2) For each fiscal year to which paragraph one of this subdivision e
applies, there shall be calculated for each retirement system the net
amount of aggregate gains and aggregate losses produced by sales in such
fiscal year and such net amount shall be transferred to a special
account in the retirement system to be known as the "deferred charge on
account of security sales". Such net amount for each such fiscal year
shall be amortized within such account, commencing with such fiscal
year, over the average maturity, rounded to the nearest year, of all
securities (excluding securities maturing in less than one year)
acquired in such fiscal year or sold in such fiscal year by the
retirement systems, whichever is less.
(3) The amount to be amortized in each fiscal year over the period of
average maturity referred to in paragraph two of this subdivision e
shall be computed on a scientific basis, (a) using a reinvestment rate
of seven and one-half per centum per annum with respect to any such net
amount computed for the city's nineteen hundred eighty--nineteen hundred
eighty-one fiscal year, and (b) using a reinvestment rate of eight per
centum per annum with respect to any such net amount computed for any
city fiscal year occurring during the period beginning on July first,
nineteen hundred eighty-one and ending on June thirtieth, nineteen
hundred eighty-four and (c) in the case of any such net amount computed
for any city fiscal year occurring thereafter, using a reinvestment rate
equivalent to that prescribed by the legislature as the rate to be used
for the purpose of any actuarial valuation, determination or appraisal
made in determining the employer contributions to be paid by responsible
public employers to the contingent reserve fund of such retirement
system in the city fiscal year next succeeding that for which such net
amount was computed.
4. Any account constituting a deferred charge on account of security
sales (whether a positive or negative quantity) which, in the absence of
the enactment of a chapter of the laws of nineteen hundred eighty-nine
which added this paragraph, would exist with respect to any retirement
system as of July first, nineteen hundred eighty-eight, shall be
cancelled and terminated as of such July first, and shall not be applied
in the determination of the normal contribution or any other
contribution payable by any responsible public employer to such
retirement system with respect to any fiscal year beginning on or after
such July first.
e-1. (1) In the case of sales by any retirement system occurring in
any fiscal year of the city beginning on or after July first, nineteen
hundred eighty-eight:
(i) any gain resulting from any such sale shall not be directly and
separately credited against contributions otherwise required to be made
by the responsible public employer or employers to such retirement
system; and
(ii) any loss resulting from any such sale shall not be directly and
separately charged as additional contributions payable to such
retirement system by the responsible public employer or employers; and
(iii) the effects of such gains or losses shall be actuarially
reflected in the valuations made for the purpose of determining
contributions payable to such retirement system.
(2) In relation to determination of the normal contribution for any
fiscal year beginning on or after July first, nineteen hundred
eighty-eight, the provisions of sub-item (C) of item (i) of subparagraph
(b) of paragraph two of subdivision b of section 13-127 of the code, and
sub-item (D) of item (i) of subparagraph (i) of paragraph two of
subdivision b of section 13-228 of the code, and sub-item (E) of item
(i) of subparagraph (b) of paragraph two of subdivision b of section
13-331 of the code, and item (iii) of subparagraph (a) of paragraph two
of subdivision b of section 13-527 of the code, or paragraph three of
sub-item (A) of item (ii) of subparagraph four of paragraph (c) of
subdivision sixteen of section twenty-five hundred seventy-five of the
education law (relating to the actuarial treatment of certain losses on
sales of fixed-income securities in the determination of the normal
contribution) shall not be deemed to refer to or include any gains or
losses on any such sales occurring in any fiscal year of the city
beginning on or after July first, nineteen hundred eighty-eight.
f. The provisions of section one hundred seventy-seven-b of the
retirement and social security law shall be inapplicable to any sale
described in subdivisions b and e-1 of this section.
g. Nothing contained in this section shall be construed as applicable
to any sale of securities constituting an investment made with funds
which are a part of a variable annuity program in the teachers'
retirement system or the board of education retirement system of the
city.
h. (1) For the purpose of determining the balance sheet liability of
any retirement system as of June thirtieth, nineteen hundred eighty
pursuant to the provisions of the retirement system act of such
retirement system governing such determination, the "annual
contribution, for balance sheet liability purposes, on account of
amortization of losses on dispositions of certain securities within the
meaning of this section", as referred to in such provisions, shall be a
hypothetical amount computed pursuant to the provisions of paragraphs
two to four, inclusive, of this subdivision g.
(2) With respect to each city fiscal year (the "subject fiscal year")
occurring during the period beginning on July first, nineteen hundred
seventy-four and ending on June thirtieth, nineteen hundred eighty,
there shall be determined the amount by which:
(i) The total of the annual installments of losses which, under the
provisions of this section as in effect prior to July first, nineteen
hundred eighty, was or would have been payable by the responsible public
employer in the second city fiscal year succeeding the subject fiscal
year, exceeds
(ii) The total of the installments of gain required by such provisions
of this section as they are in effect to be credited to the responsible
public employer in such second fiscal year.
(3) (i) There shall be computed the discounted value of the amount of
such excess as of January first of the subject fiscal year, such
discounting being calculated on the basis of the applicable interest
rate prescribed in subparagraph (ii) of this paragraph three and a
discount period of two years extending retroactively from December
thirty-first of such second fiscal year succeeding the subject fiscal
year to January first of the subject fiscal year.
(ii) With respect to the nineteen hundred seventy-four--nineteen
hundred seventy-five subject fiscal year, the rate of interest to be
used in calculating such discounted value shall be five and one-half per
centum per annum for the period beginning on July first, nineteen
hundred seventy-five and ending on December thirty-first, nineteen
hundred seventy-six and four per centum per annum for the period
beginning on January first, nineteen hundred seventy-five and ending on
June thirtieth, nineteen hundred seventy-five. With respect to each
subject fiscal year occurring during the period beginning on July first,
nineteen hundred seventy-five and ending on June thirtieth, nineteen
hundred eighty, the rate of interest used in calculating such discounted
value shall be five and one-half per centum per annum.
(4) The amount of such discounted value, as so computed with respect
to each subject fiscal year, shall be the annual contribution, for
balance sheet liability purposes, on account of amortization of losses
on dispositions of certain securities within the meaning of this
section, which annual contribution is deemed to have been hypothetically
payable in such subject fiscal year.
Section 13-705
§ 13-705 Acquisition, management and protection of investments of
retirement system funds. a. As used in this section, the term
"retirement system" shall mean any of the following: the New York city
employees' retirement system, the New York city teachers' retirement
system, the New York city board of education retirement system, the
police pension fund maintained pursuant to subchapter two of chapter two
of this title and the fire department pension fund maintained pursuant
to subchapter two of chapter three of this title.
b. Notwithstanding any other provision of law to the contrary, such
expenses as may necessarily be incurred by a retirement system in
acquiring, managing and protecting investments of its funds may be paid
from any income, interest or dividends derived from deposits or
investments of such funds.
c. (1) The provisions of this section shall not be applicable:
(i) to the acquisition, management or protection of investments of
variable annuity funds of the New York city teachers' retirement system
or of variable annuity funds of any other retirement system which may at
any time have a variable annuity program; or
(ii) to contracts for services in relation to the acquisition,
management or protection of investments of any variable annuity funds
referred to in subparagraph (ii) of this paragraph one.
(2) Nothing contained in this section shall be construed as amending,
modifying or affecting section 13-570 of this title.
d. In each city fiscal year, beginning with investment expenses paid
during the nineteen hundred ninety-eight--nineteen hundred ninety-nine
fiscal year, whenever the income, interest or dividends derived from
deposits or investments of the funds of a retirement system are used
pursuant to subdivision b of this section to pay the expenses incurred
by such retirement system in acquiring, managing or protecting
investments of its funds, the monies so paid shall be made a charge to
be paid by each participating employer otherwise required to make
contributions to such retirement system no later than the end of the
fiscal year next succeeding the fiscal year during which such monies
were drawn upon, provided, however, that where such charge is for such
investment expenses paid during fiscal year two thousand four--two
thousand five or during any subsequent fiscal year, such charge shall be
paid by each such participating employer no later than the end of the
second fiscal year succeeding the fiscal year during which such monies
were drawn upon, provided further that the provisions of this
subdivision shall not apply to investment expenses paid during the two
thousand nine--two thousand ten fiscal year or during any subsequent
fiscal year. In the event that such retirement system has more than one
participating employer, the actuary shall calculate and allocate to each
such participating employer its share of such charge. All charges to be
paid pursuant to this subdivision shall be paid at the regular rate of
interest utilized by the actuary in determining employer contributions
to the retirement system pursuant to the provisions of paragraph two of
subdivision b of section 13-638.2 of this title.
To the extent possible under law, Friends of Devin Balkind for Public Advocate has waived all copyright and related or neighboring rights to New York City Administrative Code. This work is published from: United States.
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