Section 5. Deferred compensation  


Latest version.
  • 1.  The deferred compensation board is
      hereby established, to consist of one member appointed by the  governor,
      one  member  appointed  by the temporary president of the senate and one
      member appointed by the speaker of the assembly. The board  shall  adopt
      rules  and  regulations  regarding the standards and requirements of all
      deferred  compensation  plans  established  pursuant  to  this  section,
      including selection of financial organizations for investment purposes.
        2.  a.  Notwithstanding  any  other  provision  of  law,  the deferred
      compensation board shall establish a deferred compensation  plan,  under
      the  provisions  of  section  four  hundred  fifty-seven of the internal
      revenue code and regulations adopted pursuant  thereto,  for  all  state
      employees  and  shall  promulgate  rules  and  regulations as soon as is
      reasonably practicable following the appointment of all members  of  the
      board for the appropriate administration of such a plan.
        b.  The  board  shall  enter  into written agreements with one or more
      financial organizations to administer the deferred compensation plan for
      state employees and to invest funds held pursuant to such plan. Any such
      written agreement and deferred compensation plan shall conform with  the
      provisions  of  section four hundred fifty-seven of the internal revenue
      code and regulations adopted pursuant thereto.
        c. The rules and regulations promulgated by the board shall  establish
      standards for the selection of financial organizations, authorized to do
      business in this state, to participate in such plans, including, but not
      limited to, the following criteria:
        (i)  rates  of  commission,  brokerage  and other fees, administrative
      expenses  and  related  service  charges  imposed   by   the   financial
      organization,
        (ii)  variety  of  types  of  investment  opportunities offered by the
      financial organization and/or among the financial organizations selected
      and the ability to transfer among such opportunities,
        (iii) the stability of the  financial  organization  as  evidenced  by
      experience,  reputation,  assets  and  holdings,  ability  to  guarantee
      specific rates of return,
        (iv) ability to comply with reporting requirements to the board and to
      participants in such a plan, and
        (v) such other factors which would be considered by a prudent investor
      in such a plan.
        d. The president of the state civil service commission, subject to the
      rules and regulations of the board,  shall  provide  assistance  to  any
      public employer as is appropriate to the provisions of this section.
        e.  At  the  request  of  a  state  employee the comptroller shall, by
      payroll deduction, defer the payment of part of the compensation of such
      employee as provided in a written statement by the employee and transfer
      the amount so deferred to the authorized financial organization.
        f. The board may hire such employees as it deems necessary and prudent
      to assist in its administration. Such employees may be either:
        (i) in the unclassified service of the state and, notwithstanding  any
      other  provision  of law to the contrary, shall be designated managerial
      and, as such, eligible for  benefits  provided  by  subdivision  two  of
      section  eleven  and  subdivision  (a) of section twelve of chapter four
      hundred sixty of the laws of nineteen hundred  eighty-two,  as  amended;
      section  one  hundred  fifty-eight of the civil service law; eligible to
      participate in the state deferred compensation plan, the New York  state
      and  local  employees'  retirement system; the health insurance plan for
      state employees; and subject to coverage under  sections  seventeen  and
      eighteen of the public officers law, or
        (ii) hired not as state employees but hired on a contractual basis.
    
        3.  a.  Notwithstanding  any  other  provision  of  law,  every public
      employer in the state may provide a deferred compensation plan  for  its
      employees  in  accordance  with  standards, rules and regulations of the
      deferred compensation board and the provisions of section  four  hundred
      fifty-seven  of  the  internal  revenue  code  and  regulations  adopted
      pursuant thereto.
        b. For the purposes of this section, the term "public employer"  shall
      mean:  a  county, city, town, village or any other political subdivision
      as defined in section one  hundred  thirty-one  of  the  retirement  and
      social security law or civil division of the state; a school district or
      any   governmental   entity   operating  a  public  school,  college  or
      university;  a  public  improvement  or  special  district;   a   public
      authority,  commission  or  public benefit corporation; any other public
      corporation, agency or  instrumentality  or  unit  of  government  which
      exercises  governmental  powers  under  the  laws  of  the  state or any
      instrumentality jointly created by this state and  any  other  state  or
      states.
        c.  Subject  to  the rules and regulations promulgated by the board, a
      public employer may establish a deferred  compensation  plan  and  enter
      into  written  agreements  with  one  or more financial organizations to
      administer such deferred compensation plan  for  its  employees  and  to
      invest  the  funds held pursuant to such plan or such employer may elect
      participation in the  deferred  compensation  plan  provided  for  state
      employees.  At  the  request of an employee of any such public employer,
      the chief fiscal officer or other  appropriate  officer  of  the  public
      employer  shall,  by payroll deduction, defer the payment of part of the
      compensation of such employee, as provided in a written statement by the
      employee,  and  transfer  the  amount  so  deferred  to  the  authorized
      financial organization.
        4.  Notwithstanding  the  other  provisions  of  this  section,  state
      employees,  otherwise  eligible   to   participate   in   the   deferred
      compensation  plan,  who  are  in  a  negotiating unit represented by an
      employee organization which negotiates pursuant to article  fourteen  of
      the  civil  service  law shall not be permitted to participate under the
      provisions of this section until such  time  as  such  participation  is
      authorized  pursuant  to a collectively negotiated agreement between the
      state and the employee organization; provided, however, that  the  state
      need  only  negotiate whether or not such employees shall be included in
      such plan.
        5. Should a public employer elect to provide or elect  to  participate
      in  a  deferred  compensation  plan  for employees otherwise eligible to
      participate in the plan, employees in a negotiating unit represented  by
      an  employee  organization which negotiates pursuant to article fourteen
      of the civil service law shall not be permitted to participate under the
      provisions of this section until such  time  as  such  participation  is
      authorized  pursuant  to a collectively negotiated agreement between the
      public employer and the employee organization; provided,  however,  that
      the  public  employer  need only negotiate whether or not such employees
      shall be included in such plan.
        6. To the extent permitted by section four hundred fifty-seven of  the
      internal  revenue  code  and  regulations  adopted pursuant thereto, any
      compensation deferred by a state employee or an  employee  of  a  public
      employer  under  an  eligible  deferred  compensation  plan  established
      pursuant to this section shall be considered part of annual compensation
      by any retirement system or plan to which the state or  public  employer
      contributes on behalf of said employee. However, this in no way shall be
      construed  to supersede the provision of section four hundred thirty-one
      of the retirement and social security law or any other similar provision
    
      of law which limits the salary base for  computing  retirement  benefits
      payable by a public retirement system.
        7.  Any benefit from a deferred compensation plan established pursuant
      to this section shall be in addition to any retirement benefits provided
      a state or public employee under any other provision of law.
        8. a. The term "financial organization"  shall  mean  an  organization
      authorized  to  do business in the state of New York and (A) which is an
      authorized fiduciary to act as a trustee pursuant to the  provisions  of
      an  act of congress entitled "Employee Retirement Income Security Act of
      1974" as such provisions may  be  amended  from  time  to  time,  or  an
      insurance  company;  and  (B)  (i) is licensed or chartered by the state
      insurance department, (ii) is licensed or chartered by the state banking
      department, (iii) is chartered by an agency of the  federal  government,
      (iv) is subject to the jurisdiction and regulation of the securities and
      exchange  commission  of  the  federal  government,  or (v) is any other
      entity otherwise authorized to act in this state as a  trustee  pursuant
      to  the  provisions  of an act of congress entitled "Employee Retirement
      Income Security Act of 1974" as such provisions may be amended from time
      to time.
        b. The term "state employee" as used in this  section  shall  mean  an
      employee  or  officer of the state, whose salary is paid directly by the
      state and, for the limited purposes of this section shall be  deemed  to
      include officers or employees in positions in the institutions under the
      management   and   control   of  Cornell  and  Alfred  universities,  as
      representatives of the board of trustees of the state university.