Protecting Your Retirement Get the facts about a Constitutional Convention Spring 2017

Protecting Your Retirement About the NYS Constitution and How to Amend It Impact of Constitutional Convention on Members Support and Opposition Understanding Pensions and Retirement Security Changes and Reforms What You Can Do

New York State Constitution… According to the New York State Constitution… “Membership in any pension or retirement system of the state shall be a contractual relationship, the benefits of which shall not be diminished or impaired.” Every 20 years the people of the Empire State are asked a seemingly simple ballot question; “Shall there be a convention to revise the constitution and amend the same?” Will appear on the ballot on November 7, 2017. Current polls claim 69% of the public is in favor of a Convention.

Can it REALLY Happen? Tax Cap Tier 5 Tier 6 Enrollment Or are we just overreacting? Tax Cap Tier 5 Tier 6 Enrollment Legislated Evaluations Constitutional Convention Privatization Right to Work Survival is not the same as things being ‘OK.’

Can it REALLY Happen? Last year, Governor Cuomo (D) announced support for a convention including setting up a $1 million preparatory commission. It was absent from this year’s budget, but…

Can it REALLY Happen? Assembly Minority Leader Brian Kolb (R) cites the convention as “an opportunity to change a broken system and directly participate in government.”

Can it REALLY Happen? Leaders in the Senate and Assembly both expressed opposition to a Convention.

Some will push a ‘Yes’ vote by asking things like Can it REALLY Happen? Some will push a ‘Yes’ vote by asking things like “If you could fix Albany, would you?”

Factors that make us less than optimistic… Can it REALLY Happen? Factors that make us less than optimistic… Growth of Populism. You may be lumped in with some voters’ anti-government sentiments. Voters will act based on misinformation and sound bytes. They’ll hear plenty of ads and complaints from neighbors and friends, but will they hear from YOU? Believe only way to address concerns. But they’re wrong.

Constitutional Convention vs. Constitutional Amendments The State Constitution can be changed two ways. What’s the difference?

 Increasing the mandatory retirement age for state judges Bills passed that propose specific amendment questions then appear on the November ballot. Process was undertaken in 2013 and 2014 for several changes.* This process has been used 200 times since the last major constitutional revision in 1894. Amendment Through the passage of individual bills by two separately elected state Legislatures (Article 19, §1).  Casino Gaming  Sale of constitutionally protected specific tracks of land within Adirondack Park  Increasing the mandatory retirement age for state judges  Creation of an Independent Commission on Redistricting  Allow Senate and Assembly to go paperless

If voters approve a Constitutional Convention… Three delegates per- State Senate District and 15 at-large delegates are elected at the next scheduled general election. These delegates can include sitting members of the State Legislature, political party leaders or other office holders. These delegates are allowed to hold both their elected office and a position as a delegate, collecting both salaries. This is in addition to other staff who will have to be hired to coordinate a convention. Convention meets in Albany the following April for an unspecified duration, deliberates and then publishes their suggested amendments. Proposed changes are then submitted to the voters, either individually or as a group. Another public referendum vote not sooner than six weeks after the adjournment of the convention. Convention If voters approve a Constitutional Convention…

Convention A People’s Convention A Politician’s Convention Last time it was done in 1967… 80% of the delegates were career politicians and insiders. Every politician who ran for delegate won a seat. Every convention leader was a sitting legislator. It cost $47M in taxpayer funds. NOTHING CHANGED! Convention A People’s Convention A Politician’s Convention Changes may proposed individually or in blocks.

Why is this a big deal?

Why is this a big deal? The Constitution establishes a basic organizational structure for state government. If changes are made that give too much power to one branch, for example say the executive, then our system of self- governance will be upended. The Constitution sets the most important policy goals for the people of New York State Changes will affect every other law currently in place and on future statutes yet to come.

CAN YOU IMAGINE REWRITING THE UNITED STATES CONSTITITION? Why is this a big deal? CAN YOU IMAGINE REWRITING THE UNITED STATES CONSTITITION?

Why is this a big deal? The constitution establishes the fundamental rights you enjoy as a citizen of New York State, as a public employee, and as a retired public employee, including: Guaranteeing the right to a free public education Prohibiting reductions in public pension benefits Rights to workers compensation Rights to be a member of a union and bargain collectively Requiring that the state provide for social welfare need

Working Against Us

Circle of Influence You: Commit NOW to VOTE NO and participate in this struggle every step of the way. Strong Ties: Lock in votes of friends and immediate family members. Talk to us about absentee ballots for kids off at college in November, etc. Weak Ties: Commit to better understanding what’s protected by the Constitution, including but not limited to the good pensions do not just for those who worked hard to earn them, but for OTHERS as well. Do what you can to help others see the light. Elected Leaders: You’ll be called upon to fax, call and write elected leaders to let them know where you stand as a voter. JUST DO IT! They will listen to the will of their constituents. Elected Leaders Weak Ties Strong Ties You

Working Against Us How would you characterize the ‘YES’ voter? Watch for the “anti-public-sector” type. They’ll say you should just have a 401(k) instead. Koch brothers committing $300M to changing policy under new Administration Watch for ‘Divide and Conquer’ method.

Working Against Us Divide and Conquer “Iowa Republicans propose sweeping changes to collective bargaining laws, public unions” Called Collective Bargaining reform a ‘top priority’ Remove health insurance from negotiations Limit negotiations only to base wages Bars automatic dues deduction and payroll deduction for political action Requires certification vote before every contract negotiation Exempts public safety workers, such as firefighters and police

Working Against Us 401(k)s The 401(k) Argument Longevity Risk Pooling • Manage the chance of running out of money in retirement. • Avoid the “over-saving” dilemma and do more with less. Maintenance of Portfolio Diversification • Take advantage of enhanced investment returns from an ongoing balanced portfolio. Superior Returns • Achieve greater investment returns vs. individual accounts.

Working Against Us 401(k)s The 401(k) Argument

Working Against Us Defined Contribution Defined Benefit The 401(k) Argument Defined Contribution Defined Benefit Important to be a wise investor/have a financial planner Return has direct correlation to what you contribute Market performance has direct impact on return Lump sum to manage or annuitize Never meant to replace DB plans but has become a devastating trend 6x more likely to be in poverty and/or face large financial risks in retirement Benefit tied to service credit, FAS, and possibly age Provides disability and spousal benefits Mandatory contributions not directly related to benefit Constitutional guarantee, regardless of performance Lifetime benefit

Get the REAL FACTS There is no pension crisis in NYS. Our retirements DO NOT hurt the economy. Taxpayers DO NOT pay for most of our retirements. You WILL NOT (sorry) make a “six-figure” pension.

There is NO pension crisis in NYS. The NYSTRS boasts a funded ratio of nearly 100% and is considered one of the strongest funds in the country, if not the world. Other NY systems are similarly well funded. States with pension crises have them because in the absence of strong governance (i.e. constitutional protection), politicians make shortsighted decisions and underfund the system. NY State Retirements are brilliant by design.

There is NO pension crisis in NYS. This can’t happen in NYS.

Pensions DO NOT hurt our economy. For every dollar contributed by taxpayers, $5.29 in economic activity was supported.

Pensions DO NOT hurt our economy Defined Benefit plans provide jobs and predictability in the economy. In 2014, expenditures from state and local pensions supported 215,867 jobs that paid $12.5B in wages and salaries $35.3B in total economic output $8.1B in tax revenue Imagine sucking this out of the NYS economy!

Pensions DO NOT hurt our economy In fact, the NYSTRS payroll last year was $5.3B to retirees living in New York. Removing that payroll from the economy would be like removing The entire Performing Arts and Spectator Sports industry; or The entire Motion Picture and Sound Recording industry! Again, imagine sucking this out of the NYS economy!

Taxpayers DO NOT pay for most of our retirements. For the past 20 years, NY taxpayers contributed an average of 11 cents on the dollar. Employees contributed 3 and 86 percent of the receipts come from investment earnings. Earnings on investments – not taxpayer based contributions – have historically made up the bulk of pension fund receipts!

Taxpayers DO NOT pay for most of our retirements. Twenty Year Period 1991 - 2011 Employer Contributions $12.4 billion Benefit Payments paid out $63.5 billion $88.2 1996-2016 Member Contributions $2.9 billion These all INCLUDE the years of the Great Recession! $107.5B as of 2016 Approx. MV of assets – 1991: $31B Approx. MV of assets – 2011: $89B

Taxpayers DO NOT pay for most of our retirements. NYSTRS investments turn $46.3 billion into $152.5 billion in 20 years NYSTRS has achieved 9.25% annual growth since 1985

You WILL NOT have a “Six-Figure” Pension The average retiree benefit in the TRS is around $39,000. In the ERS, it’s only around $18,000. Less than one percent of retired educators earn the much touted “six-figure pension.” These individuals are generally not rank and file classroom teachers, but rather a select group of school administrators from larger districts.

Retirement Insecurity Take the Scenic Route | Abandon Ship

Retirement Insecurity Most Americans are unprepared for retirement. Conventional Wisdom: 10-12x current income, or $1-1.5M to retire For a retiree to generate $40,000/year for a 30-year retirement, would need approx $1.18M saved 69% of Americans have less than $1000 in savings Typical Working-Age Household Has $3,000 in Retirement Assets; Near- Retirement Household Has $12,000 Good thing we can count on Social Security, though, right???

Retirement Insecurity How Do Americans Feel About Retirement? Anxious!

Retirement Insecurity Will future retirees be able to afford to stay in New York? What will the impact be on the housing market and property values when they all flee?

Changes and Reforms

Changes and Reforms

Changes and Reforms

Changes and Reforms Can this happen here?

Organizing for the NO Vote

Organizing for the NO Vote Voters rejected the last required call for a Constitutional Convention in 1997. Rejection was not by accident. Many groups worked together to convince voters that holding a convention was not in the best interest of the people of the state.

Organizing for the NO Vote These groups included: Public and private organized labor; Environmentalists and conservationists who did not want to see the repeal of the “forever wild” provisions that protect environmentally sensitive areas; Advocates for public education at all levels; Social welfare advocates who will seek to maintain the requirement that New York State provide for the underprivileged; Fiscal conservatives who wanted to keep existing State and debt limits in place; and Some government watchdog groups who just didn’t want to “spend the millions of dollars to hold a party in Albany!”

Organizing for the NO Vote We will need to work together again in 2017 to make sure voters understand just what could happen if we open up the state constitution to drastic changes through convention. 2017 is an “off” election year for the state legislature as well as an “off” year for presidential voting.

Organizing for the NO Vote Other Considerations… In the 2015-2016 Executive Budget Proposal, Governor Cuomo sought a Constitutional amendment to strip public officials of their pensions. Desire for this change will likely be a major battle cry for the Convention. This has already passed the Senate and Assembly. It could appear below the Constitutional Convention question this year or in 2018 alone. We will need to factor this in going forward. The question will be on the BACK OF THE BALLOT. Yes

Organizing for the NO Vote And Why Not? A Convention can cost taxpayers hundreds of millions of dollars. These would be paid to many of the the same politicians already in Albany. Change can be achieved without that kind of waste. Rewriting the Constitution threatens to throw laws throughout the state into upheaval. (Addressing that upheaval only costs more money.) It can cause irreparable harm to the environment, public education, social services, and the economy.

We Can CRUSH THIS! New York’s union membership rate is the highest in the country! (23.6%) Add family members and friends of union members. Off year at the polls.

We Can CRUSH THIS! Commit Act Lead Repeat Commit to voting and getting informed. Act Take actions your Union calls on you for. Lead Make sure your friends, family and colleagues are acting too. Repeat Do it again until we CRUSH THIS!

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