New York Codes, Rules and Regulations
Title 2 - DEPARTMENT OF AUDIT AND CONTROL
Chapter VI - New York State and Local Employees' Retirement System and New York State and Local Police and Fire Retirement System
Part 374 - Continuation Of Elective Office Upon Retirement From Other Public Service
Section 374.1 - Background

The Retirement and Social Security Law clearly envisions that an employee must separate from the service of the public employment upon which his or her benefit eligibility is based, in order to commence receiving a retirement allowance based on such employment. However, the provisions of such law do not specifically address the situation faced by an individual who desires to retire from a public position, but does not wish to resign from a secondary position of elective office. We believe this situation should be addressed by regulation, in view of the public policy concerns which underlay the special rules applicable to elective office that are provided by section 150 of the Civil Service Law, and the practical effects of such rules. Sections 101, 211, 212, and 401 of the Retirement and Social Security Law provide strict limits on the amount a pensioner may earn in public service without requiring a reduction or suspension of the retirement allowance. Notwithstanding these general rules, section 150 of the Civil Service Law provides a significant exception under which public pensioners may earn unlimited sums from post-retirement elective office, without a resulting suspension or diminution of their retirement allowances. It is clear that the public policy basis for this provision is to encourage - or at least remove an obstacle that may discourage - retirees from running for and holding elective office. The current effect of the general rule requiring separation from all covered public service upon retirement controverts public policy concerns that underlay section 150 of the Civil Service Law. While section 150 of the Civil Service Law exempts individuals who are elected to public office after retirement from the earnings limitations provided in sections 101, 401, 211 and 212, an individual who wishes to retire from a nonelective position while remaining in a secondary elective position must separate from the payroll of both positions in order to commence receiving a retirement allowance. This is true even though that the individual may then return to public payroll within days, without suspension or diminution of the retirement allowance, where the annual compensation for the elective position is within the post-retirement public service earnings limit provided by section 212 of the Retirement and Social Security Law. The clearly unintended effect of this statutory framework is that officers elected to office in a municipality who belong to the party which holds the majority of seats on the municipality's governing body frequently resign from the elective office at retirement, in order to commence drawing a retirement allowance - only to be reappointed by the board to complete the remainder of his or her elective term. By contrast, a member of the minority party may be prevented from retiring from the primary (nonelective) public position, because he or she would not be reappointed to the elective office upon resignation. Clearly, the regulatory structure should not make one's ability to receive a pension based on the nonelective position dependent on whether he or she serves in the majority party with respect to his elective position. Furthermore, the current regulatory framework can create the appearance of impropriety in situations where an elective official resigns from an elective position and becomes reinstated very soon thereafter in order to receive a retirement allowance. This action will solve the above discussed problems, by permitting an individual to receive a retirement allowance that is based primarily on a nonelective position without having to resign from a secondary, elective position. It is structured in a manner that will do so without permitting undue double dipping, in view of the following. The permissive exception established by this regulation will not apply to any individual whose only covered employment is the elective office. Neither will it apply to an individual whose elective position is higher paying than the nonelective position. Accordingly, it will not apply in situations where the elective office is actually the primary position upon which his or her retirement allowance is based. Lastly, the rule established by this regulation will only apply to situations in which the compensation for the elective office does not exceed the applicable section 212 earnings limit. Section 212 establishes the maximum compensation that a public pensioner may earn in public office without a resulting suspension or diminution of his or her retirement allowance. Accordingly, this measure effectively incorporates the existing standard for what should be considered de minimus post-retirement income for the purposes of allowing pensioners to receive their retirement allowances without suspension or diminution.