2012 New York Consolidated Laws
STF - State Finance
Article 2 - (2 - 19) GENERAL FISCAL PROVISIONS
5 - Deferred compensation.

 
    §  5.  Deferred  compensation.  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. Within the discretion of the deferred  compensation  board  and  in
  accordance with and subject to its fiduciary duty and obligations to the
  deferred  compensation  plan  for state employees and to the members and
  beneficiaries of such plan and such other investment limitations as  may
  be  prescribed  by  this  chapter,  the  deferred  compensation board is
  authorized  to  establish  an  MWBE  asset  management   and   financial
  institution  strategy including reasonable goals for utilization of MWBE
  asset  managers,  MWBE  financial  institutions  and  MWBE  professional
  service  firms,  which  shall  include, but shall not be limited to, the
  following objectives:
    (i) conducting procurement procedures in a manner that will assure the
  inclusion of MWBE asset managers in any request for proposal  or  search
  process  for asset management services undertaken in accordance with the
  rules and regulations and of the board;
    (ii) subject to best execution policies, developing a strategy to  (1)
  conduct   trades   of  public  equity  securities  with  MWBE  financial
  institutions and (2) conduct trades of fixed-income  securities  through
  MWBE financial institutions;
    (iii)  conducting  procurement procedures in a manner that will assure
  the inclusion of MWBE financial institutions and other MWBE professional
  service firms in procurements  for  services  that  include  accounting,
  banking,  financial  advisory, insurance, legal, research, valuation and
  other  financial  and  professional  services  that  are  undertaken  in
  accordance with the rules and regulations of the board;
    (iv)  cooperating  with  other fiduciary controlled entities and state
  agencies and offices to identify MWBE  asset  managers,  MWBE  financial
  institutions and MWBE professional service firms.
    As  used  in  this  section,  the  terms  "MWBE  asset manager", "MWBE
  financial institutions",  "MWBE",  "fiduciary-controlled  entities"  and
  "best  execution"  shall  have  the  meanings  specified  in section one
  hundred seventy-six of the retirement and social security law.
    d. The board is also authorized to:
    (i) periodically provide notice of the existence of such  strategy  so
  that  MWBE  asset  managers,  MWBE financial institutions and other MWBE
  professional service firms are made  aware  of  the  opportunities  made
  available pursuant to this strategy;
    (ii)  within  sixty  days of the end of each fiscal year following the
  effective date  of  this  paragraph,  the  board  shall  report  to  the

  governor,  legislature  and  the chief diversity officer of the state of
  New York on the participation of MWBE  asset  managers,  MWBE  financial
  institutions  and  MWBE professional service providers in investment and
  brokerage transactions with or as providers of services for the deferred
  compensation  plans,  including  a comparative analysis of such activity
  relative  to  such  activity  with   all   asset   managers,   financial
  institutions  and professional service providers for the relevant period
  and on the progress and the success of  the  efforts  undertaken  during
  such  period to achieve the goals of such strategy. Each report shall be
  simultaneously published on the website  of  the  deferred  compensation
  plans for not less than sixty days following its release to the governor
  and the other recipients named above;
    (iii)  work  with  the other fiduciary-controlled entities to create a
  database of such MWBE entities; and
    (iv) periodically, but not less than annually, hold  a  conference  to
  promote such strategy in conjunction with the other fiduciary-controlled
  entities.
    e.  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.
    f. 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.
    g. 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.
    h. 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  benefit  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
  department  of financial services, (ii) is chartered by an agency of the
  federal government, (iii) is subject to the jurisdiction and  regulation
  of  the securities and exchange commission of the federal government, or
  (iv) 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.