[House Report 106-53]
[From the U.S. Government Publishing Office]
106th Congress Report
1st Session HOUSE OF REPRESENTATIVES 106-53
=======================================================================
FEDERAL RESERVE BOARD RETIREMENT PORTABILITY ACT
_______
March 16, 1999.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______
Mr. Burton of Indiana, from the Committee on Government Reform,
submitted the following
R E P O R T
[To accompany H.R. 807]
The Committee on Government Reform, to whom was referred
the bill (H.R. 807) to amend title 5, United States Code, to
provide portability of service credit for persons who leave
employment with the Federal Reserve Board to take positions
with other Government agencies, having considered the same,
reports favorably thereon with amendments and recommends that
the bill as amended do pass.
CONTENTS
Page
I. Summary of legislation...................................... 4
II. Background and need for the legislation..................... 4
III. Legislative hearings and committee actions.................. 5
IV. Committee hearings and written testimony.................... 5
V. Explanation of the bill..................................... 7
VI. Compliance with rule XIII................................... 8
VII. Budget analysis and projections............................. 9
VIII. Cost estimate of the Congressional Budget Office............ 9
IX. Specific constitutional authority for the legislation....... 9
X. Committee recommendation.................................... 9
XI. Congressional Accountability Act; Public Law 104-1.......... 10
XII. Unfunded Mandates Reform Act; Public Law 104-4, sect. 423... 10
XIII. Federal Advisory Committee Act (5 U.S.C. App.) section 5(b). 10
XIV. Changes in existing law..................................... 10
The amendments are as follows:
Strike out all after the enacting clause and insert in lieu
thereof the following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Federal Reserve Board Retirement
Portability Act''.
SEC. 2. PORTABILITY OF SERVICE CREDIT.
(a) Creditable Service.--
(1) In general.--Section 8411(b) of title 5, United States
Code, is amended--
(A) by striking ``and'' at the end of paragraph (3);
(B) in paragraph (4)--
(i) by striking ``of the preceding
provisions'' and inserting ``other paragraph'';
and
(ii) by striking the period at the end and
inserting ``; and''; and
(C) by adding at the end the following:
``(5) a period of service (other than any service under any
other paragraph of this subsection, any military service, and
any service performed in the employ of a Federal Reserve Bank)
that was creditable under the Bank Plan (as defined in
subsection (i)), if the employee waives credit for such service
under the Bank Plan and makes a payment to the Fund equal to
the amount that would have been deducted from pay under section
8422(a) had the employee been subject to this chapter during
such period of service (together with interest on such amount
computed under paragraphs (2) and (3) of section 8334(e)).
Paragraph (5) shall not apply in the case of any employee as to whom
subsection (g) (or, to the extent subchapter III of chapter 83 is
involved, section 8332(n)) otherwise applies.''.
(2) Bank plan defined.--Section 8411 of title 5, United
States Code, is amended by adding at the end the following:
``(i) For purposes of subsection (b)(5), the term `Bank Plan' means
the benefit structure in which employees of the Board of Governors of
the Federal Reserve System appointed on or after January 1, 1984,
participate, which benefit structure is a component of the Retirement
Plan for Employees of the Federal Reserve System, established under
section 10 of the Federal Reserve Act (and any redesignated or
successor version of such benefit structure, if so identified in
writing by the Board of Governors of the Federal Reserve System for
purposes of this chapter).''.
(b) Exclusion From Chapter 84.--
(1) In general.--Paragraph (2) of section 8402(b) of title 5,
United States Code, is amended by striking the matter before
subparagraph (B) and inserting the following:
``(2)(A) any employee or Member who has separated from the
service after--
``(i) having been subject to--
``(I) subchapter III of chapter 83 of
this title;
``(II) subchapter I of chapter 8 of
title I of the Foreign Service Act of
1980; or
``(III) the benefit structure for
employees of the Board of Governors of
the Federal Reserve System appointed
before January 1, 1984, that is a
component of the Retirement Plan for
Employees of the Federal Reserve
System, established under section 10 of
the Federal Reserve Act; and
``(ii) having completed--
``(I) at least 5 years of civilian
service creditable under subchapter III
of chapter 83 of this title;
``(II) at least 5 years of civilian
service creditable under subchapter I
of chapter 8 of title I of the Foreign
Service Act of 1980; or
``(III) at least 5 years of civilian
service (other than any service
performed in the employ of a Federal
Reserve Bank) creditable under the
benefit structure for employees of the
Board of Governors of the Federal
Reserve System appointed before January
1, 1984, that is a component of the
Retirement Plan for Employees of the
Federal Reserve System, established
under section 10 of the Federal Reserve
Act,
determined without regard to any deposit or
redeposit requirement under either such
subchapter or under such benefit structure, or
any requirement that the individual become
subject to either such subchapter or to such
benefit structure after performing the service
involved; or''.
(2) Exception.--Subsection (d) of section 8402 of title 5,
United States Code, is amended to read as follows:
``(d) Paragraph (2) of subsection (b) shall not apply to an
individual who--
``(1) becomes subject to--
``(A) subchapter II of chapter 8 of title I of the
Foreign Service Act of 1980 (relating to the Foreign
Service Pension System) pursuant to an election; or
``(B) the benefit structure in which employees of the
Board of Governors of the Federal Reserve System
appointed on or after January 1, 1984, participate,
which benefit structure is a component of the
Retirement Plan for Employees of the Federal Reserve
System, established under section 10 of the Federal
Reserve Act (and any redesignated or successor version
of such benefit structure, if so identified in writing
by the Board of Governors of the Federal Reserve System
for purposes of this chapter); and
``(2) subsequently enters a position in which, but for
paragraph (2) of subsection (b), such individual would be
subject to this chapter.''.
(c) Provisions Relating to Certain Former Employees.--A former
employee of the Board of Governors of the Federal Reserve System who--
(1) has at least 5 years of civilian service (other than any
service performed in the employ of a Federal Reserve Bank)
creditable under the benefit structure for employees of the
Board of Governors of the Federal Reserve System appointed
before January 1, 1984, that is a component of the Retirement
Plan for Employees of the Federal Reserve System, established
under section 10 of the Federal Reserve Act;
(2) was subsequently employed subject to the benefit
structure in which employees of the Board of Governors of the
Federal Reserve System appointed on or after January 1, 1984,
participate, which benefit structure is a component of the
Retirement Plan for Employees of the Federal Reserve System,
established under section 10 of the Federal Reserve Act (and
any redesignated or successor version of such benefit
structure, if so identified in writing by the Board of
Governors of the Federal Reserve System for purposes of chapter
84 of title 5, United States Code); and
(3) after service described in paragraph (2), becomes subject
to and thereafter entitled to benefits under chapter 84 of
title 5, United States Code,
shall, for purposes of section 302 of the Federal Employees' Retirement
System Act of 1986 (100 Stat. 601; 5 U.S.C. 8331 note) be considered to
have become subject to chapter 84 of title 5, United States Code,
pursuant to an election under section 301 of such Act.
(d) Effective Date.--
(1) In general.--Subject to succeeding provisions of this
subsection, this section and the amendments made by this
section shall take effect on the date of enactment of this Act.
(2) Provisions relating to creditability and certain former
employees.--The amendments made by subsection (a) and the
provisions of subsection (c) shall apply only to individuals
who separate from service subject to chapter 84 of title 5,
United States Code, on or after the date of enactment of this
Act.
(3) Provisions relating to exclusion from chapter.--The
amendments made by subsection (b) shall not apply to any former
employee of the Board of Governors of the Federal Reserve
System who, subsequent to his or her last period of service as
an employee of the Board of Governors of the Federal Reserve
System and prior to the date of enactment of this Act, became
subject to subchapter III of chapter 83 or chapter 84 of title
5, United States Code, under the law in effect at the time of
the individual's appointment.
SEC. 3. CERTAIN TRANSFERS TO BE TREATED AS A SEPARATION FROM SERVICE
FOR PURPOSES OF THE THRIFT SAVINGS PLAN.
(a) Amendments to Chapter 84 of Title 5, United States Code.--
(1) In general.--Subchapter III of chapter 84 of title 5,
United States Code, is amended by inserting before section 8432
the following:
``Sec. 8431. Certain transfers to be treated as a separation
``(a) For purposes of this subchapter, separation from Government
employment includes a transfer from a position that is subject to one
of the retirement systems described in subsection (b) to a position
that is not subject to any of them.
``(b) The retirement systems described in this subsection are--
``(1) the retirement system under this chapter;
``(2) the retirement system under subchapter III of chapter
83; and
``(3) any other retirement system under which individuals may
contribute to the Thrift Savings Fund through withholdings from
pay.''.
(2) Clerical amendment.--The table of sections for chapter 84
of title 5, United States Code, is amended by inserting before
the item relating to section 8432 the following:
``8431. Certain transfers to be treated as a separation.''.
(b) Conforming Amendments.--Subsection (b) of section 8351 of title
5, United States Code, is amended by redesignating paragraph (11) as
paragraph (8), and by adding at the end the following:
``(9) For the purpose of this section, separation from
Government employment includes a transfer described in section
8431.''.
(c) Effective Date.--The amendments made by this section shall apply
with respect to transfers occurring before, on, or after the date of
enactment of this Act, except that, for purposes of applying such
amendments with respect to any transfer occurring before such date of
enactment, the date of such transfer shall be considered to be the date
of enactment of this Act. The Executive Director (within the meaning of
section 8401(13) of title 5, United States Code) may prescribe any
regulations necessary to carry out this subsection.
SEC. 4. CLARIFYING AMENDMENTS.
(a) In General.--Subsection (f) of section 3304 of title 5, United
States Code, as added by section 2 of Public Law 105-339, is amended--
(1) by striking paragraph (4);
(2) by redesignating paragraphs (2) and (3) as paragraphs (3)
and (4), respectively; and
(3) by inserting after paragraph (1) the following:
``(2) If selected, a preference eligible or veteran described in
paragraph (1) shall acquire competitive status and shall receive a
career or career-conditional appointment, as appropriate.''.
(b) Effective Date.--The amendments made by subsection (a) shall take
effect as if enacted on October 31, 1998.
Amend the title so as to read:
A bill to amend title 5, United States Code, to provide
portability of service credit for persons who leave employment
with the Federal Reserve Board to take positions with other
Government agencies, and for other purposes.
I. Short Summary of Legislation
This bill authorizes Federal Reserve Board employees who
transfer to other federal agencies to receive credit under the
Federal Employees Retirement System (FERS) for post-1988 Board
employment. This legislation also permits employees who have
transferred or will transfer to the Board to move the funds in
their Thrift Savings Plan (TSP) accounts to the Board's Thrift
Plan. The legislation also provides veterans hired under Public
Law 105-339 with the same civil service protections and job
opportunities as their co-workers.
II. Background and Need for the Legislation
H.R. 807, as amended, would permit those employees of the
Board of Governors of the Federal Reserve hired after December
31, 1983, when transferring to other federal agencies, to
receive credit under the Federal Employees Retirement System
(FERS) for their post-1988 Federal Reserve Board employment.
Current statutory language prevents the transfer of credit for
Board service after 1988. In most circumstances, this has the
effect of causing former Board employees to receive a smaller
annuity upon retirement than they would were they treated the
same as employees of other federal agencies. H.R. 807 corrects
this inequity by extending retirement portability for these
federal employees.
H.R. 807, as amended, would also allow federal employees
who have transferred or will transfer to the Board to move the
funds in their Thrift Savings Plan (TSP) accounts to the
Board's Thrift Plan. Under current law, Federal employees
participating in the Thrift Savings Plan who transfer to the
Federal Reserve Board are not permitted to withdraw funds from
their TSP accounts. This is because current law specifies that
employees ``must separate from government employment'' in order
to be entitled to withdraw funds. However, employment at the
Board is considered to be ``government employment.'' Therefore,
employees who transfer to the Board and commence participation
in the Federal Reserve's retirement plan may not withdraw the
funds in their TSP accounts. H.R. 807 offers a technical
correction that remedies this problem by allowing these
withdrawals.
H.R. 807, as amended, also perfects Public Law 105-339, the
Veterans Employment Opportunities Act of 1998. As enacted, PL
105-339 allows veterans to compete for federal job vacancies
previously restricted under internal agency promotion
procedures. Under interpretation by the Office of Personnel
Management, however, veterans hired under these procedures
would not be accorded normal career status and would not enjoy
full civil service protections. This amendment cures these
problems and ensures that veterans would enjoy all of the
promotional rights and protections possessed by other employees
in federal service.
III. Legislative Hearings and Committee Actions
H.R. 807 was introduced on February 23, 1999, by the
Honorable Joe Scarborough (R-FL), Chairman of the House
Subcommittee on Civil Service. The bill was referred to the
House Committee on Government Reform on February 23, 1999, and
it was referred to the Subcommittee on Civil Service on
February 25, 1999. The Subcommittee held a hearing and a mark
up on February 25, 1999. No amendments were offered, and the
measure was ordered favorably reported to the full Committee by
voice vote. On March 10, 1999, the Committee on Government
Reform met to consider the bill. Representative Scarborough
offered an amendment in the nature of a substitute, which was
approved by voice vote. Representative John L. Mica (R-FL)
offered an amendment to the amendment in the nature of a
substitute, which was also approved by voice vote. The
Committee favorably reported the bill, as amended, to the full
house by voice vote.
IV. Committee Hearings and Written Testimony
Federal Reserve Board retirement portability
The Subcommittee conducted a hearing comparing the Federal
Reserve's retirement systems with the two major systems
available to other federal employees, the Civil
ServiceRetirement System (CSRS) and the Federal Employees Retirement
System (FERS). Mr. Scarborough chaired the hearing, with Mrs. Morella,
Mr. Cummings, and Mrs. Norton also participating. Mr. Scarborough noted
that the Federal Reserve System operates a well-funded retirement
system which provides a more generous retirement benefit to employees
at a reduced cost to both the agency and at no cost to taxpayers. When
employees transfer to the Federal Reserve from agencies operating under
other federal retirement systems, the Federal Reserve has consistently
credited their other federal service for purposes of retirement
benefits under the Federal Reserve's retirement systems. Employees
being recruited by other federal agencies, however, are not treated
reciprocally. Thus, if Federal Reserve employees are being recruited by
other agencies, they face the potential of reduced retirement benefits
because their service with the Federal Reserve would not be credited as
federal service under FERS. H.R. 807, the Federal Reserve Retirement
Portbility Act of 1999 would authorize FERS credit for service with the
Federal Reserve, thus eliminating this potential obstacle impairing
employees' willingness to consider opportunities with other agencies.
Mr. Scarborough contrasted the ``pay-as-you-go'' funding
mechanism of CSRS and FERS, which have unfunded liabilities
totaling a reported $512.4 billion, with the Federal Reserve's
asset portfolio consisting of 80 percent common and preferred
stocks and other market equities. The Federal Reserve's
retirement programs possess $7 billion in assets which
capitalize future retirement benefits. Not only has the fund
generated sufficient revenues to pay annuities, but it has
provided the source of revenue for both the employer's and the
employees' contributions since 1986. In contrast, federal
employees and annuitants in CSRS and FERS have experienced
delays in payment of their cost-of-living adjustments (COLAs),
increases in retirement contributions paid by themselves and
their agencies, and intermittent proposals for future
reductions in benefits. Such legislation has been part of
policy discussions in each recent Reconciliation package. Mr.
Scarborough concluded, ``The Federal Reserve's management of
its retirement system demonstrates that it is possible to fund
full benefits for employees without imposing a growing burden
on future taxpayers.''
Mr. Cummings noted that this retirement portability problem
results from an oversight in the Federal Employees Retirement
System Act of 1986. It affects approximately 60 current federal
employees, and could affect as many as 1,000 employees in the
future. Under current law, employment at the Federal Reserve
after 1988 does not count as creditable federal service under
FERS. H.R. 807 would end the inequity that results from this
law, since federal employees transferring to the Federal
Reserve already receive reciprocal credit for other federal
service. Mr. Cummings noted the parallel with provisions
already covering Foreign Service employees, and observed that
the bill requires employees to surrender any claims to
retirement benefits that could be considered ``double
dipping.'' Mrs. Norton noted the importance of removing
barriers to transfers between federal agencies when the federal
workforce is in transition.
Governor Edward W. Kelley, Jr., of the Federal Reserve
reported that the Fed's Board of Governors strongly supports
the legislation. He noted that the Board's retirement plans are
qualified 401(k) plans under which the Bank and the Board, as
employers are required to ensure funding adequate to pay the
benefits. At the end of 1998, the current value of plan assets
was $5.8 billion, with benefits accrued to date totaling $3.5
billion. As a result of the surplus in theasset portfolio,
since 1986 the Board's actuaries have concluded that employer
contributions were unnecessary. The Federal Reserve Thrift Plan
provides a defined contribution benefit, comparable to the Thrift
Savings Plan for other federal employees. The Federal Reserve's thrift
component, however, offers a post-tax option in addition to the tax
deferred component, with employees able to save as much as 20 percent
of their income, subject to the Internal Revenue Service annual limits.
The retirement fund is supervised by a five-member oversight committee,
which functions as a manager of fund managers, thus distancing itself
from individual investment decisions and guarding against potential
conflicts of interest. Performance of invested assets is measured
against three benchmarks: (1) the expected long-term rate of return for
investments, (2) comparison with a 36-month composite return index, and
(3) against the plan's peer group in the Wilshire Trust Universe
Comparison Service. Governor Kelley reported that the plan met or
exceeded each of those benchmarks in recent years. Mrs. Morella noted
that the advantage available for Federal Reserve employees to
contribute to their defined contribution benefit far exceeds the
opportunities available to many lower paid federal employees under
either CSRS or FERS. In response, Mr. Kelley observed that many Federal
Reserve employees consider their ability to contribute up to the IRS'
cap a substantial benefit, and a large portion of these employees take
advantage of the additional savings opportunity.
Mr. Flynn observed that very few federal employees are
covered in retirement plans comparable to the Federal
Reserve's, so comparable legislation is unlikely to be required
for other individual-agency federal retirement programs. He
agreed that H.R. 807 would extend to Federal Reserve employees
flexibility comparable to that already available to members of
the Foreign Service. The Office of Personnel Management
supports this legislation and assisted in its drafting.
After Mr. Scarborough described the more generous benefits
and lesser risk to the government of the Federal Reserve plan,
Mr. Kelley noted that the equity component of the Federal
Reserve's plan was established in 1934, and that it was, from
the start, ``able to invest its funds more broadly than the
Federal Government had invested its Trust Funds.'' The Board's
plans have done particularly well, he observed, in the long
bull market that has occurred since 1982. He further reported
that surpluses generated by the retirement program's
investments are booked as a credit against Federal Reserve
income, so the taxpayers actually benefit from the revenues
developed through the Federal Reserve's retirement investment
practices. In response to further questioning, Mr. Kelley
described firewalls that would prevent the Treasury making
claims on surpluses in the Federal Reserve accounts. He
contended that, once the funds are transferred to the
retirement accounts, they become exclusively and legally
dedicated to funding the benefits that the Board has contracted
for with its beneficiaries. Mr. Kelley does not believe that it
would be possible for the Federal Reserve Board to transfer the
funds to the Treasury as was required of the District of
Columbia Retirement Board.
V. Explanation of the Bill as Reported: Section-by-Section
Sec. 1. This section states that this Act may be cited as
the ``Federal Reserve Board Retirement Portability Act.''
Sec. 2. This section amends chapter 84 of title 5, United
States Code, by providing forretirement service portability for
Federal Reserve service after December 31, 1988, for employees who are
later employed by other federal agencies.
A new subsection (5) would be added to section 8411(b) to
permit Federal Reserve Board employees who transfer to another
federal agency in a position covered by FERS, and who were in
the Federal Reserve Board's ``Bank Plan,'' to receive service
credit under section 8411 for service credited under the ``Bank
Plan.'' The term ``Bank Plan'' is specifically defined in
subsection (5) to refer to the benefit structure of the Federal
Reserve System's retirement plan in which employees of the
Federal Reserve Board appointed after December 31, 1983,
participate. To receive credit under FERS, Federal Reserve
Board employees who transfer to a federal agency must waive
their credit for service under the ``Bank Plan'' and they must
make a mandatory contribution equal to the amount the
transferring employee would have paid if he or she had
participated in FERS for his or her entire period of Board
employment, plus interest, in order to receive such service
credit under FERS.
Section 8402(b)(2)(A) currently states that someone who
leaves federal employment having participated in CSRS, or in
the equivalent FSPS provisions, and who had 5 years of civilian
service under either CSRS or the equivalent FSPS provisions,
shall not be permitted to participate in FERS. Section
8402(b)(2)(A) is amended by adding the retirement benefit
structure for Federal Reserve Board employees appointed prior
to January 1, 1984, which is a Federal Reserve Board retirement
plan equivalent to CSRS, so that the same exclusions that apply
to CSRS and FSPS participants will apply to Board employees who
served under that benefit structure.
Section 8402(d) is amended to exclude those Federal Reserve
Board employees who are in the Board's retirement benefit
structure for employees hired after December 31, 1983 (this is
referred to in a new subsection (5) of section 8411(b) as the
``Bank Plan''), from the exclusionary provisions of section
8402(b)(2); therefore, those employees will not be precluded
from transferring their service to FERS provided that they
transfer to another federal agency.
The provisions of this Act shall apply prospectively, i.e.,
only individuals who retire after enactment may receive credit
for service upon transferring from the Federal Reserve Board to
another federal agency.
Sec. 3. This section amends Subchapter III, of chapter 84
of title 5, United States Code, by inserting a section 8431
before section 8432. This is a technical correction that allows
federal employees who have transferred or will transfer to the
Federal Reserve Board to move the funds in their Thrift Savings
Plan (TSP) accounts to the Board's Thrift Plan.
Sec. 4. This section amends Subsection (f) of section 3304
of title 5, United States Code, as added by section 2 of Public
Law 105-339. PL 105-339 allows veterans to compete for federal
job vacancies previously restricted under internal agency
promotion procedures. However, under the interpretation of the
Office of Personnel Management, veterans hired under these
procedures would not be accorded normal career status and would
not enjoy full civil service protections. This clarifying
amendment ensures that veterans would enjoy all of the
promotional rights and protections enjoyed by their co-workers.
VI. Compliance With Rule XIII
Pursuant to the Rules of the House of Representatives,
under the authority of rule XIII, clause 3(c)(1) and clause
3(e), the results and findings from Committee oversight
activities are incorporated in the bill and this report.
VII. Budget Analysis and Projections
The budget analysis and projections required by section
308(a) of the Congressional Budget Act of 1974 are contained in
the estimate of the Congressional Budget Office.
VIII. Cost Estimate of the Congressional Budget Office
To: George Nesterczuk, Committee on Government Reform.
From: Eric Rollins, CBO.
Date: March 15, 1999.
Re: Preliminary estimate for H.R. 807.
As you requested, I have reviewed H.R. 807, the Federal
Reserve Board Retirement Portability Act, as reported by the
Committee on Government Reform on March 10, 1999. The bill
would make changes to the Federal Employees' Retirement System
(FERS) and the Thrift Savings Plan (TSP) that would benefit
certain employees who have worked for both the federal
government and the Federal Reserve Board of Governors.
I estimate that H.R. 807 would not have a significant
impact on the federal budget during the 2000-2004 period.
Discretionary spending would decline by about $10,000 annually
because the bill would allow certain employees to be covered by
the Civil Service Retirement System's offset provisions instead
of FERS, which has higher agency retirement contributions and
requires agencies to make matching TSP contributions. Direct
spending would increase slightly because the decline in agency
retirement contributions would also reduce receipts received by
the Civil Service trust fund. The bill would not have a
significant impact on federal retirement benefits because the
employees affected by the bill are generally still in the
middle of their careers. Finally, revenues would increase by
about $5,000 annually as employees make deposits to the Civil
Service trust fund to receive credit under FERS for prior
Federal Reserve service.
Because this bill would affect direct spending and
receipts, pay-as-you-go procedures would apply. This estimate
is preliminary and subject to change. If you have any
questions, please feel free to call me.
IX. Specific Constitutional Authority for This Legislation
Clauses 1 and 18 of Article I, Sec. 8 of the Constitution
grant Congress the power to enact this law.
X. Committee Recommendation
On March 10, 1999, a quorum being present, the Committee
ordered the bill, as amended, favorably reported.
Committee on Government Reform, 106th Congress, Rollcall Vote
Dated: March 10, 1999.
Final: Passage of H.R. 807, as amended.
Offered by: Hon. Joe Scarborough (FL).
Adopted by voice vote.
XI. Congressional Accountability Act; Public Law 104-1; Section
102(B)(3)
H.R. 807 affects employees of the legislation branch who
transfer to the Federal Reserve Board, as well as employees who
move from the Federal Reserve Board into the legislative
branch.
XII. Unfunded Mandates Reform Act; Public Law 104-4; Section 423
In the opinion of the Committee, H.R. 807 contains no
intergovernmental or private-sector mandates as defined in the
Unfunded Mandates Reform Act (UMRA) and would not have any
significant effects on the budgets of state, local, or tribal
governments.
XIII. Federal Advisory Committee Act (5 U.S.C. App.) Section 5(b)
The Committee finds that H.R. 807 does not establish or
authorize establishment of an advisory committee within the
definition of 5 U.S.C. App., Section 5(b).
XIV. Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, existing law in which no change is
proposed is shown in roman):
TITLE 5, UNITED STATES CODE
* * * * * * *
PART III--EMPLOYEES
* * * * * * *
Subpart B--Employment and Retention
* * * * * * *
CHAPTER 33--EXAMINATION, SELECTION, AND PLACEMENT
* * * * * * *
SUBCHAPTER I--EXAMINATION, CERTIFICATION, AND APPOINTMENT
* * * * * * *
Sec. 3304. Competitive service; examinations
(a) * * *
* * * * * * *
(f)(1) Preference eligibles or veterans who have been
separated from the armed forces under honorable conditions
after 3 years or more of active service may not be denied the
opportunity to compete for vacant positions for which the
agency making the announcement will accept applications from
individuals outside its own workforce under merit promotion
procedures.
(2) If selected, a preference eligible or veteran described
in paragraph (1) shall acquire competitive status and shall
receive a career or career-conditional appointment, as
appropriate.
[(2)] (3) This subsection shall not be construed to confer an
entitlement to veterans' preference that is not otherwise
required by law.
[(3)] (4) The area of consideration for all merit promotion
announcements which include consideration of individuals of the
Federal workforce shall indicate that preference eligibles and
veterans who have been separated from the armed forces under
honorable conditions after 3 years or more of active service
are eligible to apply. The announcements shall be publicized in
accordance with section 3327.
[(4) The Office of Personnel Management shall establish an
appointing authority to appoint such preference eligibles and
veterans.]
* * * * * * *
Subpart G--Insurance and Annuities
* * * * * * *
CHAPTER 83--RETIREMENT
* * * * * * *
SUBCHAPTER III--CIVIL SERVICE RETIREMENT
* * * * * * *
Sec. 8351. Participation in the Thrift Savings Plan
(a) * * *
(b)(1) Except as otherwise provided in this subsection, the
provisions of subchapters III and VII of chapter 84 of this
title shall apply with respect to employees and Members making
contributions to the Thrift Savings Fund under subsection (a)
of this section.
* * * * * * *
[(11)] (8) In applying section 8432b to an employee
contributing to the Thrift Savings Fund after being restored to
or reemployed in a position subject to this subchapter,
pursuant to chapter 43 of title 38--
(A) any reference in such section to contributions
under section 8432(a) shall be considered a reference
to employee contributions under this section;
(B) the contribution rate under section
8432b(b)(2)(A) shall be the maximum percentage
allowable under subsection (b)(2) of this section; and
(C) subsections (c) and (d) of section 8432b shall be
disregarded.
(9) For the purpose of this section, separation from
Government employment includes a transfer described in
section 8431.
* * * * * * *
CHAPTER 84--FEDERAL EMPLOYEES' RETIREMENT SYSTEM
SUBCHAPTER I--GENERAL PROVISIONS
Sec.
8401. Definitions.
* * * * * * *
SUBCHAPTER III--THRIFT SAVINGS PLAN
8431. Certain transfers to be treated as a separation.
* * * * * * *
SUBCHAPTER I--GENERAL PROVISIONS
* * * * * * *
Sec. 8402. Federal Employees' Retirement System; exclusions
(a) The provisions of this chapter comprise the Federal
Employees' Retirement System.
(b) The provisions of this chapter shall not apply with
respect to--
(1) * * *
[(2)(A) any employee or Member who has separated from
the service after--
[(i) having been subject to subchapter III of
chapter 83 of this title, or subchapter I of
chapter 8 of the Foreign Service Act of 1980;
and
[(ii) having completed at least 5 years of
civilian service creditable under subchapter
III of chapter 83 of this title, or at least 5
years of civilian service creditable under
subchapter I of the Foreign Service Act of 1980
(determined without regard to any deposit or
redeposit requirement under either such
subchapter, or any requirement that the
individual become subject to either such
subchapter after performing the service
involved); or]
(2)(A) any employee or Member who has separated from
the service after--
(i) having been subject to--
(I) subchapter III of chapter
83 of this title;
(II) subchapter I of chapter
8 of title I of the Foreign
Service Act of 1980; or
(III) the benefit structure
for employees of the Board of
Governors of the Federal
Reserve System appointed before
January 1, 1984, that is a
component of the Retirement
Plan for Employees of the
Federal Reserve System,
established under section 10 of
the Federal Reserve Act; and
(ii) having completed--
(I) at least 5 years of
civilian service creditable
under subchapter III of chapter
83 of this title;
(II) at least 5 years of
civilian service creditable
under subchapter I of chapter 8
of title I of the Foreign
Service Act of 1980; or
(III) at least 5 years of
civilian service (other than
any service performed in the
employ of a Federal Reserve
Bank) creditable under the
benefit structure for employees
of the Board of Governors of
the Federal Reserve System
appointed before January 1,
1984, that is a component of
the Retirement Plan for
Employees of the Federal
Reserve System, established
under section 10 of the Federal
Reserve Act,
determined without regard to any
deposit or redeposit requirement under
either such subchapter or under such
benefit structure, or any requirement
that the individual become subject to
either such subchapter or to such
benefit structure after performing the
service involved; or
* * * * * * *
[(d) Paragraph (2) of subsection (b) shall not apply to an
individual who becomes subject to subchapter II of chapter 8 of
title I of the Foreign Service Act of 1980 (relating to the
Foreign Service Pension System) pursuant to an election and who
subsequently enters a position in which, but for such paragraph
(2), he would be subject to this chapter.]
(d) Paragraph (2) of subsection (b) shall not apply to an
individual who--
(1) becomes subject to--
(A) subchapter II of chapter 8 of title I of
the Foreign Service Act of 1980 (relating to
the Foreign Service Pension System) pursuant to
an election; or
(B) the benefit structure in which employees
of the Board of Governors of the Federal
Reserve System appointed on or after January 1,
1984, participate, which benefit structure is a
component of the Retirement Plan for Employees
of the Federal Reserve System, established
under section 10 of the Federal Reserve Act
(and any redesignated or successor version of
such benefit structure, if so identified in
writing by the Board of Governors of the
Federal Reserve System for purposes of this
chapter); and
(2) subsequently enters a position in which, but for
paragraph (2) of subsection (b), such individual would
be subject to this chapter.
* * * * * * *
SUBCHAPTER II--BASIC ANNUITY
* * * * * * *
Sec. 8411. Creditable service
(a) * * *
(b) For the purpose of this chapter, creditable service of an
employee or Member includes--
(1) * * *
* * * * * * *
(3) except as provided in subsection (f) or (h), any
civilian service (performed before January 1, 1989,
other than any service under paragraph (1) or (2))
which, but for the amendments made by subsections
(a)(4) and (b) of section 202 of the Federal Employees'
Retirement System Act of 1986, would be creditable
under subchapter III of chapter 83 of this title
(determined without regard to any deposit or redeposit
requirement under such subchapter, any requirement that
the individual become subject to such subchapter after
performing the service involved, or any requirement
that the individual give notice in writing to the
official by whom such individual is paid of such
individual's desire to become subject to such
subchapter); [and]
(4) a period of service (other than any service under
any [of the preceding provisions] other paragraph of
this subsection and other than any military service)
that was creditable under the Foreign Service Pension
System described in subchapter II of chapter 8 of the
Foreign Service Act of 1980, if the employee or Member
waives credit for such service under the Foreign
Service Pension System and makes a payment to the Fund
equal to the amount that would have been deducted from
pay under section 8422(a) had the employee been subject
to this chapter during such period of service (together
with interest on such amount computed under paragraphs
(2) and (3) of section 8334(e))[.]; and
(5) a period of service (other than any service under
any other paragraph of this subsection, any military
service, and any service performed in the employ of a
Federal Reserve Bank) that was creditable under the
Bank Plan (as defined in subsection (i)), if the
employee waives credit for such service under the Bank
Plan and makes a payment to the Fund equal to the
amount that would have been deducted from pay under
section 8422(a) had the employee been subject to this
chapter during such period of service (together with
interest on such amount computed under paragraphs (2)
and (3) of section 8334(e)).
Paragraph (5) shall not apply in the case of any employee as to
whom subsection (g) (or, to the extent subchapter III of
chapter 83 is involved, section 8332(n)) otherwise applies.
* * * * * * *
(i) For purposes of subsection (b)(5), the term ``Bank Plan''
means the benefit structure in which employees of the Board of
Governors of the Federal Reserve System appointed on or after
January 1, 1984, participate, which benefit structure is a
component of the Retirement Plan for Employees of the Federal
Reserve System, established under section 10 of the Federal
Reserve Act (and any redesignated or successor version of such
benefit structure, if so identified in writing by the Board of
Governors of the Federal Reserve System for purposes of this
chapter).
* * * * * * *
SUBCHAPTER III--THRIFT SAVINGS PLAN
Sec. 8431. Certain transfers to be treated as a separation
(a) For purposes of this subchapter, separation from
Government employment includes a transfer from a position that
is subject to one of the retirement systems described in
subsection (b) to a position that is not subject to any of
them.
(b) The retirement systems described in this subsection are--
(1) the retirement system under this chapter;
(2) the retirement system under subchapter III of
chapter 83; and
(3) any other retirement system under which
individuals may contribute to the Thrift Savings Fund
through withholdings from pay.
* * * * * * *