EXECUTIVE SUMMARY

Part 1/3

Bolton Partners, Inc. (Bolton) was retained by the Comptroller to serve as the Independent Actuary under Section 96 of the New York City Charter and provide other services related to the review of the funding of the following five actuarial pension funds (collectively NYCRS or the Systems):

  • New York City Employees’ Retirement System (NYCERS);
  • Teachers’ Retirement System of the City of New York (TRS);
  • Board of Education Retirement System of the City of New York (BERS);
  • New York City Police Pension Fund (POLICE); and
  • New York City Fire Pension Fund (FIRE).

Bolton will conduct two consecutive biennial actuarial engagements, encompassing the following:

  • Biennial Contribution Audits of the computed employer contributions for each System in NYCRS for fiscal years 2016 and 2018 (including an audit of actuarial accrued liabilities and actuarial valuation of assets);
  • Biennial Experience Studies for the periods ending June 30, 2015 and June 30, 2017, for each System in NYCRS;
  • Two Administrative Reviews of the data gathering and maintenance practices of the Office of the Actuary (OA) and each System in NYCRS (one review corresponding with each Contribution Audit); and
  • Two Independent Actuarial Statements (one for each engagement); Bolton, as the independent actuarial auditor, will submit a statement that will briefly describe the scope of the entire engagement, will review the entire engagement and comment on the financial condition and financing progress and policies of each System, and certify that the Systems are being funded on a sound actuarial, financial, and legal basis.

This report constitutes the deliverable with respect to the Experience Study for the first engagement. The purpose of this study is to:

  • Update the Experience Study database with membership data as of June 30, 2014 and June 30, 2015;
  • Mature the database with status changes;
  • Review actual experience for the four-year period ending June 30, 2015 and compare with assumed experience;
  • Review actual experience for the ten-year period ending June 30, 2015 and compare with assumed experience; and
  • Indicate areas where experience deviated from current assumptions to such an extent that the Office of the Actuary should consider an immediate change.

Our analysis concluded that none of the current assumptions vary enough from actual experience to currently warrant revision;

Specific detail on each System is provided throughout the report, regarding assumptions that we anticipate suggesting revisions to in the next study.

ORGANIZATION OF REPORT

Section II contains documentation on our processes and procedures. Section III contains a detailed analysis on the economic and demographic assumptions. Section IV contains an analysis of the effect of proposed assumption revisions on plan liabilities and annual costs.  Finally, the appendices contain the reconciled data for each group for each assumption by age and/or service compared to the current assumptions and the reconciliation of participant counts from the prior study.

This study was conducted in accordance with generally accepted actuarial principles and practices, and with the Actuarial Standards of Practice issued by the Actuarial Standards Board.