Section 13-232.2. Payments to police superior officers' variable supplements fund for base fiscal years included in the period commencing on July first, nineteen hundred eighty-eight and ending on June thirtieth, nineteen hundred ninety-two

a. For the purposes of this section,  the  definitions  of  terms  set
  forth in paragraphs two, four, six, eight, nine and ten of subdivision a
  of  section  13-232  of  this  subchapter  shall  apply  to this section
  13-232.2 with the same force and effect  as  if  such  definitions  were
  specifically set forth in this section.
    b.  For  the  purposes of this section, the following terms shall mean
  and include:
    1. "Base fiscal year". Any fiscal year of the  city  included  in  the
  period beginning on July first, nineteen hundred eighty-eight and ending
  on June thirtieth, nineteen hundred ninety-two.
    2.  "Prior base fiscal year". Any fiscal year of the city which begins
  on or after July first, nineteen hundred eighty-eight and which precedes
  the base fiscal year.
    3. "Cumulative earnings factor as of June thirtieth, nineteen  hundred
  eighty-eight".  (a)  An  amount,  expressed  as  a  positive or negative
  quantity, as the case may be, which shall be  determined  in  accordance
  with the method set forth in subparagraph (b) of this paragraph three.
    (b)  (i) The cumulative earnings differential for the base fiscal year
  (as defined in paragraph eleven of subdivision a of  section  13-232  of
  this    subchapter),    as    applicable   to   the   nineteen   hundred
  eighty-seven--nineteen hundred eighty-eight  base  fiscal  year  (as  so
  defined)  shall  be  computed pursuant to the provisions of such section
  13-232.
    (ii) The cumulative distributions of transferable earnings  for  prior
  base  fiscal years (as defined in paragraph thirteen of subdivision a of
  such section 13-232) shall be computed pursuant to such  section  13-232
  with  respect  to  such  nineteen hundred eighty-seven--nineteen hundred
  eighty-eight base fiscal year.
    (iii) The amount of transferable earnings  (as  defined  in  paragraph
  twelve  of  subdivision  a  of  such  section  13-232),  if any, for the
  nineteen hundred eighty-seven--nineteen hundred eighty-eight base fiscal
  year, determined pursuant to such section 13-232, shall be added to  the
  cumulative  distributions  of transferable earnings computed pursuant to
  item (ii) of this subparagraph (b).
    (iv) The sum resulting from the addition prescribed by item  (iii)  of
  this  subparagraph  (b)  shall  be  subtracted  from the amount computed
  pursuant to item (i) of this subparagraph.
    (v)  The  remainder  resulting  from  the  subtraction  shall  be  the
  cumulative  earnings  factor  as  of  June  thirtieth,  nineteen hundred
  eighty-eight.
    4. "Equity experience factor". (a) An amount (expressed as a  positive
  or  negative  quantity)  which  shall be determined for each base fiscal
  year in accordance with the method  of  computation  set  forth  in  the
  succeeding subparagraphs of this paragraph four.
    (b)  The  amount  of income earned by the pension fund during the base
  fiscal year from its investment in equities shall be computed.
    (c) To each such amount of income for a base fiscal year  there  shall
  be  added  the  capital gains, realized and unrealized, occurring during
  such base fiscal year by reason of such investments.
    (d)  From  the  sum  resulting  from  the   addition   prescribed   by
  subparagraph (c) of this paragraph there shall be subtracted the capital
  losses,  realized  or unrealized, occurring during such base fiscal year
  by reason of such investment.

    (e) In the event that any equity is sold during the base fiscal  year,
  the  expense  of  such  sale,  including  but  not  limited  to broker's
  commissions, shall be deducted from capital gain  or  added  to  capital
  loss,  in  determining  whether  such  sale produced a capital gain or a
  capital loss and the amount thereof.
    (f)  (i) With respect to base fiscal years occurring during the period
  beginning on July first, nineteen hundred  eighty-eight  and  ending  on
  June  thirtieth,  nineteen  hundred ninety, the remainder resulting from
  the subtraction prescribed by subparagraph (d) of this  paragraph  shall
  be adjusted so that it equals the amount which it would have been in the
  absence  of the enactment of chapter two hundred forty-seven of the laws
  of nineteen hundred eighty-eight and chapter five hundred eighty-one  of
  the laws of nineteen hundred eighty-nine.
    (ii)  With  respect  to  each  base fiscal year included in the period
  beginning on July first, nineteen hundred  ninety  and  ending  on  June
  thirtieth, nineteen hundred ninety-two, the remainder resulting from the
  subtraction  prescribed  by  subparagraph (d) of this paragraph shall be
  adjusted so that it equals the amount which it would have  been  in  the
  absence  of the enactment of chapter two hundred forty-seven of the laws
  of nineteen hundred eighty-eight.
    (iii) For the purpose of determining the entitlement, with respect  to
  any  base  fiscal  year  included in the period beginning on July first,
  nineteen hundred ninety and ending on June thirtieth,  nineteen  hundred
  ninety-two,  of  the police superior officers' variable supplements fund
  to receive payment of any sum from the pension  fund  pursuant  to  this
  section,  the cumulative earnings factor for such base fiscal year shall
  be  calculated  in  the  same  manner  as  if  (A)  that  part  of  this
  subparagraph,  which  part, prior to July twenty-sixth, nineteen hundred
  ninety-one, referred to chapter five hundred eighty-one of the  laws  of
  nineteen  hundred eighty-nine, had never been enacted and (B) items (ii)
  and (iii) of this subparagraph, as such items were in  effect  prior  to
  July twenty-sixth, nineteen hundred ninety-one, had never been enacted.
    (g)  Any  adjustment required to be made pursuant to the provisions of
  subparagraph (f) of this paragraph  shall  be  computed  pursuant  to  a
  scientific  method  recommended to the board by the actuary and approved
  by the board; provided that if the board is unable to  approve,  by  the
  required  majority  vote,  any  such formula recommended by the actuary,
  such adjustment shall be  computed  pursuant  to  a  scientific  formula
  recommended  by  the  actuary  and  approved by an arbitrator designated
  pursuant to the procedure set forth in  subparagraph  (b)  of  paragraph
  eight of subdivision a of section 13-232 of this subchapter.
    (h)  The  equity  experience factor for such base fiscal year shall be
  the amount remaining after the adjustment  prescribed  by  subparagraphs
  (f) and (g) of this paragraph has been made.
    5.  "Hypothetical fixed income securities earnings". (a) The aggregate
  of the hypothetical interest yields computed pursuant  to  subparagraphs
  (b), (c) and (d) of this paragraph five.
    (b)  The  board  shall compute with respect to each investment made or
  maintained by the pension fund in an equity during the base fiscal year,
  the amount of interest  which  would  have  been  hypothetically  earned
  during  such fiscal year, under the methods of calculation prescribed in
  this paragraph five, if an amount equal to such investment  had  instead
  been  hypothetically  invested  in  fixed  income  securities  and  such
  securities had been held by such fund for a period (in the  base  fiscal
  year)  co-extensive with the period during which such equity was held by
  such fund in the base fiscal year.

    (c) For  the  purposes  of  this  section,  the  amount  of  any  such
  investment  in  an equity during the base fiscal year shall be deemed to
  be:
    (i) the market value of the equity on the first day of the base fiscal
  year,  in the case of any such equity acquired by the pension fund prior
  to the commencement of such fiscal year and held by  such  fund  on  the
  first day of such fiscal year; and
    (ii)  the  total  amount  paid  by  such  fund  to acquire the equity,
  including but not limited to broker's commissions and other expenses  of
  such  acquisition,  in  the case of any such equity which is acquired by
  such fund during the base fiscal year.
    (d) For the purposes of this section, the  amount  of  interest  which
  would  have  been  earned by the pension fund on such hypothetical fixed
  income securities during the base fiscal year shall be deemed to be  the
  amount obtained:
    (i)  by  multiplying  the  amount  of  the  investment in such equity,
  determined as prescribed by subparagraph (c) of this paragraph five,  by
  the assumed rate of interest for the base fiscal year; and
    (ii)  by  prorating  the  interest  so computed, in any case where the
  investment in such equity was maintained by the pension fund for a  part
  of the base fiscal year; and
    (iii) by multiplying the amount of interest computed for the full base
  fiscal  year  pursuant  to  items (i) and (ii) of this subparagraph by a
  fraction, the numerator of which is the amount designated as the  equity
  experience  factor with respect to such base fiscal year by subparagraph
  (h) of paragraph four of this subdivision b and the denominator of which
  is the remainder produced by the subtraction prescribed by  subparagraph
  (d) of such paragraph four with respect to such base fiscal year; and
    (iv)  by  adding  together  the  products  of all such multiplications
  performed pursuant to item (iii) of this subparagraph in relation to all
  such equities held by the pension fund during such fiscal year.
    6. "Cumulative earnings factor". (a) The  cumulative  earnings  factor
  for any base fiscal year shall be determined as follows:
    (i)  If  the  cumulative earnings factor for the immediately preceding
  base fiscal year was a positive quantity, the cumulative earnings factor
  for the base fiscal year shall be equal to the earnings differential for
  the base fiscal year.
    (ii) If the cumulative earnings factor for the  immediately  preceding
  base fiscal year was a negative quantity, the cumulative earnings factor
  for the base fiscal year shall be equal to the sum of:
    (A) the earnings differential for the base fiscal year; and
    (B)  the cumulative earnings factor for the immediately preceding base
  fiscal year.
    (b) In applying the provisions of this subdivision six  for  the  base
  fiscal   year   nineteen   hundred   eighty-eight  --  nineteen  hundred
  eighty-nine, the term defined in paragraph three of this  subdivision  b
  as  "cumulative  earnings  factor as of June thirtieth, nineteen hundred
  eighty-eight" shall be substituted for  the  term  "cumulative  earnings
  factor for the immediately preceding base fiscal year".
    7.  "PSOVSF  cumulative  earnings  factor".  With  respect to any base
  fiscal year, the amount obtained by multiplying the cumulative  earnings
  factor  for  such base fiscal year by a fraction, the numerator of which
  shall be the total contributions made to the pension fund  with  respect
  to such base fiscal year on behalf of all members of the uniformed force
  of  the  police  department  who are police superior officers, as of the
  last day of such base fiscal year, and the denominator of which shall be
  the total contributions made to the pension fund with  respect  to  such
  base  fiscal  year  on  behalf  of  all  persons  who are members of the

  uniformed force of the police department as of the last day of such base
  fiscal year.
    8.  "Police  superior officers". Members of the uniformed force of the
  police department who (a) hold the position of sergeant or any  position
  of higher rank in such force, or (b) are detectives.
    9.  "Police  superior officers' variable supplements fund". The police
  superior officers' variable supplements fund established  by  subchapter
  four of this chapter.
    c.  As  soon  as practicable after the close of each base fiscal year,
  but not later than August thirty-first of the current fiscal  year,  the
  board  shall  compute the PSOVSF cumulative earnings factor with respect
  to such base fiscal year.
    d. If the PSOVSF cumulative earnings factor for the base  fiscal  year
  is   a  positive  quantity,  the  pension  fund,  on  or  before  August
  thirty-first of the current fiscal year, shall pay from  its  contingent
  reserve  fund to the police superior officers' variable supplements fund
  a sum equal to the amount of such factor.
    e. The comptroller shall furnish to the  board  such  information  and
  data as it may request for the purpose of carrying out the provisions of
  this section.