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PENSION NEWS AND UPDATES

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Early Retirement Incentive
2007 Pension Equity Bill Passes New Tax Deferred Savings Option  Two Identity Theft Alerts 2005 Pension Victory

 



the web  
psc-cuny.org

 

Early Retirement Incentive.

The CUNY B.O.T. voted on Monday. 6/28/10, to allow all fulltime members of the instructional staff who have at least 10 years of service and are at least 50 years old as of January 27, 2011 to consider taking the state sponsored early retirement incentive.

Two separate PSC information brochures on CUNY’s 2010 Early Retirement Incentive (ERI) are now available.

  • TRS brochure for members of the Teachers Retirement System.
  • ORP brochure is for members of TIAA-CREF and other plans in CUNY’s Optional Retirement Program (ORP). 

ERI information is also available on the CUNY website.

The incentive will provide for members of the NYC Teachers Retirement System additional service credit of one month for each year of service to a maximum of 36 months for 36 years of service.  Members of TIAA/CREF will receive 1/12xyears of servicex15% salary to a maximum of 45% of salary with 36 years of service. This lump sum will go directly into the TIAA/CREF pension plan in late spring of 2011.  Travia and annual payments will be spread out over 3 payments in late spring of 2011, 2012 and 2013. There will be January, 2011 deadline dates by which forms will have to be filed with both the university and the retirement system. The PSC will be setting up meetings in the fall on each campus for those interested. CUNY will also be holding meetings in all 5 boroughs and TIAA/CREF individual counselors will be on campus continuously to meet with instructional staff.  For those interested in making an appointment with a TIAA/CREF counselor please call 1-800-732-8353.

Final Phase of Employee Pension Contribution Implemented April 2010

April 2010 sees the implementation of the final phase of the legislative victory on pension equity spearheaded by the PSC.  The pension equity legislation, passed in 2008 as a result of intense advocacy in Albany, increases take-home pay for employees in the Optional Retirement Programs (primarily TIAA-CREF) who have 10 years of full-time service.  Take-home pay increases because the 3% employee contribution to the pension fund is assumed by the employer after 10 years.  The legislation brought parity for ORP participants with other public employees in civilian State and City pension plans—such as CUNY faculty and staff in TRS—for whom elimination of the 3% employee contribution was achieved in 2001.

From 2001 to 2008, the PSC worked tirelessly, with the active support of our statewide affiliate NYSUT, to achieve this victory for investment in faculty and staff.   The change in State legislation would not have been possible without the many faculty and staff who walked the halls in Albany to lobby their state representatives, wrote letters, called, and sent emails. 

The elimination of the 3% employee contribution has been phased in over three years, with the final phase occurring this April.  The elimination of the final 1% of the employee’s contribution is reflected in the April 8 paycheck for those at senior colleges and with the April 16 paycheck for those at community colleges.  Full-time instructional staff members with 10 years or more of service at CUNY who belong to TIAA-CREF or other ORP plans should check their paycheck stubs to be sure that the pension contribution is no longer being deducted. If you believe that there is an error, please contact either your Human Resources office or Clarissa Weiss , PSC Director of Pension and Welfare Fund Benefits.

In the future, CUNY will assume the 3% employee contribution for all full-time employees when they reach 10 years of service, increasing take-home pay by more than 3%.
Posted April 19, 2010

City Security Breach May Impact Retirees 

On August 18, 2007, a laptop computer being used by a consultant to the New York City Financial Services Agency (FISA) was stolen. The computer contained personal identifying information on a certain number of retirees who receive pensions through city pension systems.  It is likely that some PSC retirees are included in this group.  Read more. 
Posted Sept. 12, 2007

PSC PENSION EQUITY BILL SIGNED INTO LAW! 

Governor Spitzer signed our pension equity bill into law on August 15.  For the tens of thousands of CUNY and SUNY faculty and staff who are in the Optional Retirement Program (either TIAA-CREF or the other ORP options), the new law will restore equity in mandatory pension contributions with our TRS colleagues. 

In 2000, New York State enacted a law eliminating the mandatory 3% pension contribution by participants in TRS after they had attained ten years of credited service.  The new legislation provides the same benefit, phased in over three years, to participants in TIAA-CREF and other ORP plans. The law provides for the City and State to pick up the employee’s required contribution, gradually increasing take-home pay for eligible faculty and staff by up to 3%—depending on your current level of contribution.  (We will publish details of implementation of the law as soon as they are available.) 

At the time of the creation of the ORP, it was the Legislature's expressed intent to ensure the equitable treatment of all public retirement systems. That intent is fulfilled by the new law.    

The enactment of the law is a victory for thousands of hard-working faculty and staff at CUNY—and it’s a victory for public higher education in New York.  The legislation will make faculty and professional staff positions at CUNY and SUNY more competitive by restoring pension equity and increasing take-home pay.  It will help to enhance the academic stature of the state’s public university systems.  The law is also a victory in the broader effort to restore public investment in public institutions—one of the PSC’s central goals.

We are grateful to the governor and the legislators who supported the legislation, and to the labor/management coalition that helped to make it possible.  We are also grateful to our statewide affiliate, NYSUT, for working tirelessly on the bill, which the PSC originated.  Above all, PSC members should know that our collective voice was heard.  Thank you to thousands of faculty and staff who wrote and faxed and emailed and called to show your support for this bill.  It was you the members—organized by the union as a political force—who won it.   -- Barbara Bowen
Posted August 17, 2007

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LEGISLATURE OKS PENSION EQUITY BILL
Fairness for those in TIAA-CREF
 

By Peter Hogness  (From the Summer 2007 Clarion This article was written before Governor Elliot Spitzer signed the bill on 8/15/07)

On June 21, the New York Legislature passed a pension equity bill that has been one of the PSC’s top priorities for the last seven years. The bill now awaits Gov. Spitzer’s signature. [Spitzer signed the bill on August 15th.]

We need one last push from members to get this bill signed,” said Steve London, PSC first vice president and legislative representative. “NYSUT has made this bill its top priority and CUNY and TIAA-CREF have issued statements of support. We have put together a broad coalition of support and now the governor needs to hear that this is something the members want.”  

CONTRIBUTIONS  

The legislation provides that CUNY and SUNY employees in the Optional Retirement Plan (ORP), which includes TIAA-CREF and similar plans, who have 10 or more years of service would have the State or City pick up the contribution members are currently making to their pension plan. For most participants, this will mean a savings of 3% of their annual pay.  

When Albany approved a similar change for TRS members in 2000, employees in TIAA-CREF and other plans were left out. “It’s an equity issue,” said former PSC Secretary Cecelia McCall, who coordinated the union’s grassroots lobbying push to win legislative approval. “This is a benefit that people in TRS have had for several years, and people in TIAA-CREF should not get different treatment.”  

Pedro Irigoyen, Chief College Lab Technician in the chemistry department at Queensborough Community College, called his representative, State Senator Serf Maltese to urge support for the bill. Irigoyen has worked at CUNY for 25 years. “It’s a matter of fairness,” he told Clarion. “What’s done for others should be done for all.” He said he would use the savings to put aside more for his retirement: “I’m about 10 years away from retiring, and this would help quite a bit.”  

At one time most PSC members were in TRS, which is a traditional defined-benefit pension system. Today, most choose to join CUNY’s ORP, a defined-contribution system. “When the ORP was created, the Legislature was explicit about its intent to ensure equitable treatment of all public retirement systems,” said London. “This reform puts that intent into practice.”  

If signed into law, the bill would be phased in over a three-year period, with the employer picking up a 1% additional contribution in each year.  

“When we came into office in 2000, we found that a deal had been cut on pensions as part of that year’s round of collective bargaining, which gave this benefit to TRS participants,” London told Clarion. “But the ORP was left out. We immediately went to work to get the ORP plans included, but it was too late – the deal was already sealed.” PSC leaders then moved to build support within the union’s state affiliate, New York State United Teachers (NYSUT), for the necessary reform. After discussions with leaders of United University Professions (SUNY’s statewide union of faculty and staff) and with leaders of the separate locals at the SUNY community colleges, NYSUT took up the issue as a legislative priority.  

“In the spring of 2001 we had support in principle from the legislature and the governor,” London said. But agreement on a budget was delayed – and then 9/11 happened.  

The tentative agreement was knocked off the table, in what was the first of several contentious State budget years.  

“We brought the bill forward every year and worked hard to build support for it over time,” London said. “Then last year, with a lot of member support, we got the pension equity bill passed in Albany by both houses – only to have it vetoed by Gov. Pataki.”  

“This year we again did a full-court press,” said London. “It became NYSUT’s number-one priority, and we had an outpouring of support from our members calling their legislators. And so, seven years after we began this effort, we got it passed by the legislature a second time.”  

GRATIFIED  

“I felt gratified that almost every member we called already knew about this issue,” said McCall. “They knew we had been trying to get it for a while and they were grateful that we called. So the word is out there, and members appreciated having a chance to affect the outcome. 

” Members’ phone calls made the difference: all four State Senators targeted by the PSC supported the bill, and their backing helped secure approval by the Senate’s Republican majority.  

McCall noted that the CUNY administration also threw its support behind the legislation. “They told legislators that this is a tool for recruitment,” she explained.

As Clarion went to press, union members were again being asked to make their voices heard – this time to contact the governor. The bill will be officially delivered to Gov. Spitzer in early August, and he will have 10 days in which to take action.  

Peter Jonas, chair of the PSC Pension Committee, urged union members to take action. “Last year we achieved a legislative victory, but saw the bill torpedoed by then-Governor Pataki,” Jonas told Clarion. “This year, we – PSC members – must let Governor Spitzer know that he needs to step up and sign this legislation.”   

Thanks, in part, to the hundreds of "Act Now" faxes sent by members, Governor Elliot Spitzer signed the new ORP pension bill into law on August 15, 2007.


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NEW SAVINGS OPTION
Retirement Plan is tax-deferred 

By Clarisa Gilbert Weiss
PSC Director of Pension & Welfare Benefits
(From the Summer 2007 Clarion)

As of September 1, 2007, CUNY will offer its employees a new form of tax-deferred savings, the New York State Deferred Compensation Plan.  

Known as a “457 Plan,” the program allows employees to set aside as little as 1% of their salary or as much as $15,500 per year in pre-tax contributions to various plan-sponsored investment vehicles. This amount is in addition to any money that employees invest in CUNY’s existing tax-deferred options.  

THREE EXECUTIVES  

The 457 Plan will have three account executives assigned to CUNY’s campuses to provide information to employees. There will be a telephone hotline, a managed website, reports and a quarterly newsletter. Account executives have already begun to visit CUNY campuses to explain the plan and assist employees who wish their deductions to begin in the Fall. However, enrollment can occur at any time during the year, and employees can increase, decrease or stop their contributions at any time.  

START AT ANY TIME  

Those employed by multiple colleges will have to file separate enrollment applications with the human resources office at each college if they wish to have payroll deductions made from each job.  

Although the 457 Plan is offered through the State, it is open to both senior and community college employees. All CUNY employees who receive either a New York City or State paycheck are eligible to participate. The 457 Plan is open to both full-time and part-time employees, as well as to CUNY retirees who work as adjuncts. If you reach age 701⁄2 and are still employed at CUNY, you do not have to begin withdrawals from the plan until you retire.  

Withdrawals can be made only after age 591⁄2 and must begin no later than age 701⁄2 if you are no longer employed either full-time or part-time at CUNY. Money contributed and the interest earned are both exempt from federal, state and local taxes until withdrawn. However, taxes must be paid on all withdrawals.  

There are hardship provisions that allow individuals who qualify to withdraw money before age 591⁄2. While the hardship rules are strict, they do not include any penalties for early withdrawals.  

31 CHOICES

The NYS 457 Plan has 31 different investment vehicles, including money market funds, bond funds, balanced funds, stock funds and international funds. There is one social choice fund, PAX World, and a Lifecycle Fund. The annual administrative fee for the plan, which is run on a for-profit basis, is $14.00. For each of the mutual funds, fund operating expenses range from 0.10% to 0.35% of assets, a charge that is deducted directly from participants’ accounts. Some funds may impose a short-term trade fee or be subject to a trade restriction policy.  

Individuals may take out loans of up to $50,000 or 50% of assets (whichever is less) that must be paid back within five years.  

Employees in the NYC Teachers’ Retirement System who are paying back for prior service may use their own 457 plan assets to buy that time back. (Employees who participate in CUNY’s SRA or TDA plans can presently use those accounts to do the same thing, and the 457 Plan functions similarly.)  

Money that CUNY employees have in a 403B or 401K plan or an IRA may be rolled into the 457 Plan at any time.  

When an employee leaves CUNY service, money in his or her 457 Plan may remain in the plan or be rolled over into a 403B or 401K plan, into an IRA, or into another 457 plan. Beneficiaries may remain in the 457 Plan upon the death of the CUNY employee or retiree.  

GET INFORMED  

If you are interested in this type of investment, speak to the account executives when they come to your campus. As with all financial investments, the PSC encourages members to start by educating themselves about their options and opportunities.  

If you have questions, contact your campus human resources office or e-mail Clarissa Gilbert Weiss at the PSC at cweiss@pscmail.org.  

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TWO IDENTITY THEFT ALERTS: 
      1. TRS  
      2. TIAA

TRS MEMBERS -- CHECK YOUR BANK ACCOUNTS:  You may have read news reports that note that City employees, both active and retired, who are members of the New York City Teachers’ Retirement System (TRS) had money illegally taken from their private bank accounts.

TRS says that social security numbers and bank account information for members, and their beneficiaries, may have been compromised.  TRS believes that more than 5,000 accounts were accessed.  A small percentage were PSC members.  In a few cases personal bank accounts have been accessed by thieves and funds withdrawn.  TRS cannot tell us who was effected by this theft of information, because the investigation is ongoing. Several people have been arrested in connection with the case.

There are several steps that PSC advises you to take:

1.      Examine the bank account statements over the past two years for any accounts for which TRS has account numbers.  It is important that you check for any unauthorized withdrawals.  Any beneficiaries with account numbers in TRS’s system should also be advised to check their accounts.
2.      If you feel your account may have been compromised, close your account and open a new bank account with a new bank.   If your pension check is deposited via Electronic Fund Transfer (EFT) and you don’t want an interruption in services, TRS asks you to let them know by the 20th of the month when you change your account, and they will send you a paper check. 
The TRS Call Center is accepting EFT cancellation requests over the phone if the member uses his or her PIN.  Members who wish to submit written cancellations should use TRS Form BK19.  The form is available at the TRS Web Site (www.trs.nyc.ny.us/) under Forms – Post Retirement.  TRS is expediting the processing of these forms.
3.      Make sure you fill out the proper paperwork with TRS to notify them of your account change.  Please let the PSC know if you have closed your account.  We do not want account information, just your name.  We will then follow up with TRS to make sure they have updated your information.  Please
call or email Clarissa Gilbert Weiss at 212-354-1252 or cweiss@pscmail.org
4.      Contact a commercial credit protection service.  NYSUT has made arrangements with Equifax to provide not only 3 months free service, but also a deeply discounted annual charge for this service.
5.      This is a good time for you to request a free credit report.   For information on that and more on protecting your identity, go to this government website:
http://www.consumer.gov/idtheft/.


Also, if you received a letter from TRS, please contact Clarissa Gilbert Weiss at 212-354-1252 or email
cweiss@pscmail.org

PSC has been in contact with TRS and will continue to monitor this situation.

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A LINK FOR TIAA MEMBERS ON THE ISSUE OF IDENTITY THEFT

Recently, the State Comptroller sent some members of the CUNY Instructional Staff who are members of TIAA/CREF a letter stating that a file sent from the Comptrollers' Office was missing.  That file has been found and it was intact.  The Comptrollers' Office is sending a follow-up letter explaining that no personal information was accessed.  However, we strongly urge people to monitor their personal accounts.  Employees may wish to contact a commercial credit protection service such as Equifax which, under an agreement with NYSUT, will provide 3 months of free credit reporting.  This is also a good time to request a free credit report from www.consumer.gov/idtheft/.  The December, 2003 Clarion has an important article (page 9) which you can access by clicking here.  The PSC is in touch with both TIAA-CREF and the State Comptroller’s Office and will continue to monitor this situation.

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2005 PSC VICTORY ON PENSION IMPROVEMENTS

 

The PSC has won a significant victory on pensions.  Our major contract demand on pensions has been achieved away from the bargaining table, through policy changes advocated by the PSC and agreed to by the CUNY Board of Trustees. 

 

Participants in the Optional Retirement Program (ORP)-TIAA/CREF, HRC or MetLife-will no longer be required to leave one-third of their retirement funds in the TIAA/CREF program upon retirement.  As of September 1, 2005, the amount required to remain with the program to cover health insurance premiums will be reduced to $50,000.  This is a major victory for our members because it gives ORP participants more control over and access to their own retirement funds.  The PSC has advocated for this change for more than a decade.

 

In advocating for the change, PSC President Barbara Bowen testified before the CUNY Board of Trustees, describing the number of members "who are bewildered and angry at the CUNY regulation that requires participants in the ORP to retain 33% of their retirement accounts with TIAA/CREF."   Bowen continued: "For many, the restrictions on the use of TIAA/CREF, which are exclusive to CUNY and do not apply, for instance, at SUNY, feel like one more insult added on top of salaries whose real-dollar value is declining every day we don't get a raise." 

 

At their meeting on Monday, June 27, 2005, the CUNY Board of Trustees approved a series of changes in the Optional Retirement Program (ORP), which for most members is TIAA/CREF.  While the changes do not go as far as we would like, we have a commitment from the University to revisit the pension provisions within three years and modify them if warranted.

 

The five changes are as follows:

 

1.  As of September 1, 2005, participants in the Optional Retirement Program entitled to after-retirement health insurance will no longer be required to keep 33% of their retirement funds within TIAA/CREF.  The required amount to be retained with TIAA/CREF to guarantee funds to cover retiree health insurance premiums will be $50,000 (which is significantly less than a third of total funds in most cases).  Although the union advocated reducing this amount further, we are pleased that the University agreed to our demand to lift much of this burdensome regulation.  In addition, retirees will no longer have to shift monies from other CUNY Optional Retirement Programs to TIAA/CREF for certification.

 

2.  As of September 1, 2005, individuals who wish to transfer their pension from TIAA to an independent account may now do so without having funds first transferred to the CREF account.  An unnecessary and burdensome step will be eliminated.  

 

3.  As of September 1, 2005, employees who are certified terminally ill will be entitled to draw on their ORP funds prior to retirement.

 

4.  As of September 1, 2005, employees who leave their CUNY positions and accept employment with another employer that offers TIAA/CREF and who are eligible for CUNY after-retirement health benefits will continue to be required to follow CUNY regulations on keeping monies within TIAA/CREF after retirement.  This provision ensures that these employees will continue to receive their health benefits after retirement.

 

5.  As of July 1, 2005, members of the NYC Teachers Retirement System who are purchasing prior service may use the monies in their Supplemental Retirement Accounts with either TIAA/CREF or HRC Financial Service as a rollover for this purchase.  This provision will be particularly beneficial to adjuncts, whose only pension option currently is TRS and who may wish to purchase prior service. 

 

In her testimony before the Board of Trustees, Bowen strongly urged the Trustees to consider an amount lower than $50,000 for the funds to be retained with TIAA/CREF, and also pressed management to extend to part-time instructional staff the right to join the ORP.  "Because of the tenuous nature of adjunct employment at CUNY, having the option of joining TIAA/CREF would improve the opportunity for adjuncts to vest and count on a modicum of after-employment income stability, as well as permitting professional part-timers to manage their own accounts.  This change is long overdue."  She concluded: "It's time for material changes in adjuncts' working conditions to reflect the extent to which the University relies on their work." 

 

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