2016_SUNY_Optometry_PRR

2 0 1 5 A N N U A L F I N A N C I A L R E P O R T

Notes to Financial Statements June 30, 2015 and 2014

7. Long-term Liabilities (continued)

8. Retirement Plans Retirement Benefits

Collateralized Borrowing In March 2013, the State enacted legislation amending the Public Authorities Law and Education Law of the State. The amendments, among other things, authorized the State University to assign to DASNY all of the State University’s rights, title and interest in dormitory facilities revenues derived from payments made by students and others for use and occupancy of certain dormitory facilities. The amendments further authorize DASNY to issue State University of New York Dormitory Facilities Revenue Bonds payable from and secured by the dormitory facilities revenues assigned to it by the State University. The enacted legislation also created a special fund to be held by the State’s Commissioner of Taxation and Finance on behalf of DASNY. All dormitory facilities revenues collected by the State University are required to be deposited in this special fund. The outstanding obligations under these bonds are reported as collateralized borrowing in the State University’s financial statements since these bonds are not payable from any money of the State University or the State and neither the State University nor the State has any obligation to make any payments with respect to the debt service on the bonds. The pledged revenues recognized during the fiscal years ended June 30, 2015 and 2014 amounted to $527.5 million and $505.2 million, respectively. There were principal and interest payments during 2015 of $2.8 million and $21.8 million, respectively, and no payments during 2014. Total principal and interest outstanding on the bonds at June 30, 2015 were $437.2 million and $248.6 million, respectively, payable through July 1, 2043. In May 2015, bonds with a par amount of $268.8 million at a premium of $38.3 million were issued to refinance $295.8 million of the State University’s existing residential facility obligations. These bonds are special obligations of DASNY payable solely from the dormitory facilities revenues collected by the State University as agent for DASNY.

The two major defined benefit retirement plans State University employees participate in are ERS and TRS. ERS is a cost-sharing, multiple-employer, defined benefit public plan administered by the State Comptroller. TRS is a cost-sharing, multiple- employer, defined benefit public plan separately administered by a ten-member board. The State University reported amounts include the net pension asset (liability) for employees of the State University that participate in ERS and TRS pension plans. Obligations of employers and employees to contribute, and related benefits, are governed by the New York State Retirement and Social Security Law (NYSRSSL) and Education Law and may only be amended by the Legislature with the Governor’s approval. These plans offer a wide range of programs and benefits. ERS and TRS benefits vary based on the date of membership, years of credited service and final average salary, vesting of retirement benefits, death and disability benefits, and optional methods of benefit payments. Both plans provide a permanent annual cost-of-living increase to both current and future retired members meeting certain eligibility requirements. Participating employers are required under law to contribute to these plans on an actuarially determined rate. For ERS, this rate is determined annually by the State Comptroller and the average contribution rate for the fiscal year ended March 31, 2015 was approximately 20.1 percent of payroll. For TRS, this rate is determined by the TRS Board on annual basis and was 16.25 percent of payroll for the year ended June 30, 2014. ERS and TRS provide retirement benefits as well as death and disability benefits. For those members joining prior to January 1, 2010 benefits generally vest after five years of credited service. For those joining after January 1, 2010, benefits generally vest after 10 years of credited service. The NYSRSSL provides that all participants in ERS and TRS are jointly and severally liable for any actuarial unfunded amounts. Such amounts are collected through annual billings to all participating employers.

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