N.Y. Retirement & Social Security Law § 313: Management of funds

§ 313. Management of funds. a. The funds of the police and fire

retirement system shall be managed in accordance with this section.

b. The comptroller shall be trustee of the several funds of the police

and fire retirement system. Such funds shall be invested by the

comptroller in securities in which he or she is authorized by law to

invest the funds of the state, except that he or she may invest in

obligations consisting of notes, bonds, debentures or equipment trust

certificates issued under an indenture, which are the direct obligations

of, or in the case of equipment trust certificates are secured by direct

obligations of, a railroad or industrial corporation, or a corporation

engaged directly and primarily in the production, transportation,

distribution, or sale of electricity, or gas, or the operation of

telephone or telegraph systems or waterworks, or in some combination of

them; provided the obligor corporation is one which is incorporated

under the laws of the United States, or any state thereof, or of the

District of Columbia, and said obligations shall be rated at the time of

purchase within the three highest classifications established by at

least two standard rating services. The maximum amount that the

comptroller may invest in such obligations shall not exceed thirty per

centum of the assets of the New York state police and fire retirement

system's funds; and provided further that not more than two and one-half

per centum of the assets of the New York state police and fire

retirement system's funds shall be invested in the obligations of any

one corporation of the highest classification and subsidiary or

subsidiaries thereof, that not more than two per centum of the assets of

the New York state police and fire retirement system's funds shall be

invested in the obligations of any one corporation of the second highest

classification and subsidiary or subsidiaries thereof, that not more

than one and one-half per centum of the assets of the New York state

police and fire retirement system's funds shall be invested in the

obligations of any one corporation of the third highest classification

and subsidiary or subsidiaries thereof. He or she shall, however, be

subject to all terms, conditions, limitations and restrictions imposed

by this article and by law upon the making of such investments. The

comptroller shall have full power:

1. To hold, purchase, sell, assign, transfer or dispose of any of the

securities or investments, in which any of the funds of the police and

fire retirement system shall be invested, including the proceeds of such

investments and any monies belonging to such funds, and

2. In his or her name as trustee, to foreclose mortgages upon default

or to take title to real property in such proceedings in lieu thereof

and to lease and sell real property so acquired.

c. The comptroller annually shall credit to each of the funds of the

police and fire retirement system regular interest on the mean amount

therein for the preceding year.

d. The custody of all funds of the police and fire retirement system

shall be in the charge of the head of the division of the treasury of

the department of taxation and finance, subject to the supervision and

control of the commissioner of taxation and finance.

e. Payment of all pensions, annuities and other benefits shall be made

as provided in this article. For the purpose of meeting disbursements

for pensions, annuities and other payments ordered by the comptroller,

the head of such division may keep on deposit an available fund which

shall not exceed ten per centum of the total amount of the several funds

of the police and fire retirement system. Every such deposit shall be

kept only in a bank or trust company organized under the laws of this

state, or in a national bank located in this state, which shall furnish

adequate security therefor.

f. The comptroller, however, shall have a fund in his or her immediate

possession. Such fund shall be used for the immediate payment of:

1. All pensions, annuities and other benefits, and

2. Such expenses as may necessarily be incurred in acquiring,

servicing and foreclosing mortgages and in acquiring, managing and

protecting investments, and

3. Such special expenditures for which the police and fire retirement

system will be paid by the state or a participating employer. Such fund

shall be reimbursed from time to time by the head of such division on

the warrant of the comptroller.

g. Neither the comptroller nor any person employed on the work of the

police and fire retirement system shall:

1. Except as herein provided, have any interest, direct or indirect,

in the gains or profits of any investment of the police and fire

retirement system, nor, in connection therewith, directly or indirectly,

receive any pay or emolument for his or her services.

2. Except as provided in section three hundred fifty of this article:

(a) Directly or indirectly, for himself or herself or as an agent or

partner of others, borrow any of its funds or deposits or in any manner

use the same except to make such current and necessary payments as are

authorized by the comptroller, or

(b) Become an endorser, surety or an obligor in any manner of monies

loaned by or borrowed of such funds.

h. The police and fire retirement system may use a part of its funds,

not exceeding ten per centum of its assets, (1) for purchasing or

leasing of land in the city of Albany and the construction thereon of a

suitable office building or buildings for the transaction of the

business of the retirement system, (2) for purchasing or leasing of land

in the cities of Albany, Syracuse, Buffalo, Binghamton, New York,

Rochester and Utica and the construction thereon of a suitable office

building or buildings for purposes of lease or sale to the state, (3)

for purchasing or leasing of land in the city of Albany on the north and

south sides of Washington avenue commonly known as the "Campus Site"

acquired by the state for a state building site pursuant to the

provisions of chapter five hundred seventy-two of the laws of nineteen

hundred forty-seven and the construction thereon of power plants

including service connections, electric substations including service

connections, garages, warehouses and restaurant facilities deemed

necessary for the efficient and economical operation of the office

building or buildings constructed on such land and (4) for purchasing or

leasing of land in the city of Albany acquired by the state for suitable

parking facilities for the use primarily of employees of the state and

persons having business with state departments and state agencies and

the construction thereon of such structures, appurtenances and

facilities deemed necessary for the efficient and economical operation

of the parking facilities constructed on such land and (5) for

purchasing or leasing of land in locations approved by the state

university trustees and the construction, acquisition, reconstruction,

rehabilitation or improvement of suitable buildings or facilities

thereon for purposes of lease or sale to the state university

construction fund, such buildings or facilities to be used by the state

university or by state-operated institutions or statutory or contract

colleges under the jurisdiction of the state university or by the

students, faculty and staff of the state university or of any such

state-operated institution or statutory or contract college, and their

families.

The police and fire retirement system from time to time may lease to

any public agency any portion of a building constructed for the

transaction of its business which may not be required for such purpose,

upon such terms and conditions as shall be deemed to be for the best

interest of the police and fire retirement system.

Real property of the police and fire retirement system acquired or

constructed pursuant to this subdivision shall be exempt from taxation.

i. At the close of each fiscal year, the average rate of investment

earnings of the retirement system shall be computed by the actuary and

certified to the comptroller. This rate shall be determined from the

investment earnings during the calendar year which ended three months

prior to the close of the fiscal year. For any year that such average

rate of earnings is in excess of three per centum but not in excess of

four per centum, the comptroller shall declare a rate of special

interest, for members earning regular interest of three per centum,

equal to the difference between such average rate of earnings and three

per centum, expressed to the lower one-tenth of one per centum, but not

in excess of one per centum. For any year, commencing with the fiscal

year the first day of which is April first, nineteen hundred seventy,

that such average rate of earnings is in excess of four per centum, the

special rate of interest for members earning regular interest of three

per centum shall be equal to the difference between such average rate of

earnings and three per centum, expressed to the lower one-tenth of one

per centum, but not in excess of two per centum, and for members earning

regular interest of four per centum, it shall be the difference between

such average rate of earnings and four per centum, expressed to the

lower one-tenth of one per centum, but not in excess of one per centum.

Special interest at such rates, shall be credited, by the comptroller at

the same time that regular interest is credited, to the individual

annuity savings accounts of persons who are members as of the close of

the fiscal year. Special interest shall not be considered in determining

rates of contribution of members. In the case of persons who last became

members on or after July first, nineteen hundred seventy-three, the

provisions of this subdivision shall apply only to the fiscal years

beginning April first, nineteen hundred seventy-two and ending March

thirty-first, nineteen hundred seventy-three.

j. The retirement system may invest, within the limitations authorized

for investments in conventional mortgages, a part of its funds in first

mortgages on real property located anywhere within the boundaries of the

United States and leased to the government of the United States,

provided however, that no such investment shall be made unless the terms

of the mortgage shall provide for amortization payments in an amount

sufficient to completely amortize the loan within the period of the

lease.