New York Gov. Andrew Cuomo’s proposal to overhaul the state pension system is “extremely unlikely” to be in place by the April 1 deadline, according to state Comptroller Thomas DiNapoli’s office.
The changes include giving employees the option of choosing a 401(k)-style plan instead of a traditional government pension, with an estimated savings to taxpayers of $113 billion over 30 years. The changes would go into effect if lawmakers approve Mr. Cuomo’s $132.5 billion proposed budget before the fiscal year ends March 31, Mike Dutcher, an actuary for New York’s retirement system, wrote in a budget analysis obtained Thursday through a Freedom of Information Law request.
“Remittance of employer contributions on a payroll schedule, rather than annually under the defined benefit plan, will affect employers’ cash management,” Mr. Dutcher wrote in the note. “It also seems extremely unlikely that such a plan could be implemented by April 1.”
Implementing the changes would cost as much as $16 million, the note said.
Morris Peters, a spokesman for Mr. Cuomo’s Budget Division, said in an e-mail that the pension group is reviewing the comptroller’s analysis. Josh Vlasto, a spokesman for Mr. Cuomo, didn’t respond to an e-mail and phone call requesting comment.
Mr. DiNapoli the sole trustee of the $133.8 billion New York State Common Retirement Fund, Albany, has spoken out against public employers switching from defined benefit plans to defined contribution plans. Mr. DiNapoli said he hasn’t dismissed Mr. Cuomo’s proposal.
The pension fund has raised contribution rates on state and local employers as the fund’s investments dipped with the economy. Mr. Cuomo’s plan is meant to reduce those rates over time, in part by keeping employees who choose the defined contribution option out of the system.
The governor’s plan would save public employers outside of New York City $83 billion over 30 years, and the city $30 billion over the same period, Mr. Cuomo has said.