![](media/image1.jpeg){width="6.497916666666667in"
height="1.0534722222222221in"}

# Legislative Bulletin..............................................January 23, 2007

**Contents:**

**H.R. 476**---To amend title 5, United States Code, to make
noncreditable for Federal retirement

purposes any Member service performed by an individual who is convicted
of any of certain offenses

committed by that individual while serving as a Member of
Congress**---AS AMENDED**

H.R. 476---To amend title 5, United States Code, to make noncreditable
for Federal retirement purposes any Member service performed by an
individual who is convicted of any of certain offenses committed by that
individual while serving as a Member of Congress (*Boyda, D-KS*)

**[Order of Business]{.underline}**: The bill was considered on the
House floor on Monday, January 22^nd^, under a motion to suspend the
rules and pass the bill, [as amended]{.underline}. The vote on final
passage was rolled to today, January 23^rd^.

The delays in House floor activity yesterday arose when the Democrat
Leadership brought forth a revised version of H.R. 476 to make it
effective to final convictions after January 2, 2009. The Democrats
claimed that such revision was made to prevent the triggering of the
Constitution's 27^th^ Amendment (which prevents Member compensation from
being altered without an intervening election). The Congressional
Research Service has informed one of our Member-offices that the bill
would NOT violate the 27^th^ Amendment.  The changes in pension
calculations included in this bill do not vary compensation; they vary
penalties.  These are penalties assessed for crimes against the public
trust. 

Making the effective date January 3, 2009, would allow Members to commit
the relevant crimes and be convicted before January 3, 2009, and still
receive their FULL pension. Under pressure from Republicans, the
Democrats changed the effective date back to any final convictions after
the bill's enactment. However, the bill that came to the floor also
added one additional crime that would trigger the pension-stripping
provisions of this bill (see "Summary" below).

**[Summary (amendments from original version in
red-bold)]{.underline}**: H.R. 476 would prohibit any years that a
Member served as a Member of Congress from counting toward his or her
retirement accruals, once convicted of certain crimes. In other words,
this bill would make it harder for congressmen convicted of crimes,
while serving in Congress, to collect their federal retirement benefits.

Specifically, the bill would prevent the service as a Member of Congress
from being taken into account when calculating accrued benefits under
the Civil Service Retirement System (CSRS) and the Federal Employees'
Retirement System (FERS), if such Member has been "finally convicted" of
an offense under the following sections of title 18, U.S. Code:

-   Bribery of public officials and witnesses (section 201);

-   Officers and employees acting as agents of foreign principals
    (section 219);

-   Conspiracy to commit offense or to defraud the United States
    (section 371), to the extent it relates to the above two offenses or
    the restrictions on former officer, employees, and elected officials
    of the executive and legislative branches---section 207);

-   Perjury regarding the above offenses (section 1621); **or**

-   **Subornation of the aforementioned perjury (section 1622).**

The offense would have to have been committed while the individual was a
Member of Congress, in direct relation to the Member's performance of
his official duties, and **[after the enactment of this
legislation]{.underline}**.

A Member could still receive his or her lump-sum payment otherwise
attributable to federal service as a Member of Congress (i.e. refunds of
annuity contributions that he made---but NOT the government
contributions or any paper gains), and could no longer participate in
CSRS or FERS, as applicable. The Office of Personnel Management would be
directed to prescribe regulations on these provisions, including any
interest payable on the lump-sum payment, and the possible payment to
the spouse or children of a convicted Member of the Member's whole
retirement benefit (including service as a Member, as if the above
provisions did not apply), given "the totality of the circumstances."

A "Member of Congress" is defined as the Vice President, a member of the
Senate or the House of Representatives, a Delegate to the House of
Representatives, and the Resident Commissioner from Puerto Rico.

**[Additional Background]{.underline}**: This legislation is nearly
identical to Rep. Mark Kirk's Congressional Pension Forfeiture Act (H.R.
6172) from last Congress (never considered), which was extracted from
section 601 of last Congress' lobbying reform bill (H.R. 4975), as
passed by the House, when it was clear that a lobbying reform conference
agreement was not going to materialize. H.R. 476 is similar to Rep. John
Shadegg's Congressional Pension Accountability Act (H.R. 4546) from last
Congress, reintroduced as H.R. 466 this Congress. The Shadegg
legislation prohibits interest payments on contribution refunds and does
not allow for payments to spouses and children of convicted Members.

This legislation is being offered largely in response to the actions of
former Rep. Duke Cunningham (R-CA), who steered federal appropriations
to entities in exchange for large personal benefits provided by such
entities.

The Congressional Research Service (CRS) provides this background on
CSRS and FERS:

> Most civilian federal employees who began their careers before 1984
> are
>
> covered by the Civil Service Retirement System (CSRS). Federal
> employees first hired in 1984 or later are covered by the Federal
> Employees' Retirement System (FERS). Both CSRS and FERS require
> participants to contribute toward the cost of the plans through a
> payroll tax. Employees who are covered by CSRS contribute 7.0% of pay
> to the Civil Service Retirement and Disability Fund (CSRDF). They do
> not pay Social Security taxes and are not eligible for Social Security
> benefits.
>
> Employees who are covered under FERS contribute 0.8% of their full pay
> to the civil service trust fund and 6.2% of pay to Social Security on
> salary up to \$94,200 in 2006. The minimum retirement age under both
> CSRS and FERS is 55 for workers who have at least 30 years of service;
> however, starting in 2003, the FERS minimum retirement age began to
> rise for workers born after 1947, and it eventually will reach age 57
> for employees born in 1970 or later.
>
> FERS and CSRS also allow retirement with an unreduced pension at age
> 60 for employees with 20 or more years of service, and at age 62 for
> workers with at least 5 years of service.
>
> The Thrift Savings Plan (TSP) is a *defined contribution* retirement
> plan similar to the "401(k)" plans provided by many employers in the
> private sector. In 2006, employees covered under either CSRS or FERS
> can contribute up to \$15,000 to the TSP. Employees age 50 and older
> can contribute an additional \$5,000 to the TSP.
>
> Employees covered by FERS receive employer matching contributions of
> up to 5% of pay from the federal agency by which they are employed.
> Federal workers covered by CSRS also can participate in the TSP, but
> they receive no matching contributions from their employing agency.
>
> The Office of Personnel Management (OPM) estimates the cost of CSRS to
> be an amount equal to 25% of employee pay. The federal government pays
> 18% of this amount and the other 7.0% is paid by employees. OPM
> estimates the cost of the FERS basic annuity at an amount equal to 12%
> of pay. The federal government contributes 11.2% of this amount and
> the other 0.8% is paid by employees. There are three other employer
> costs for employees covered by FERS. Both the employer and employee
> pay Social Security taxes equal to 6.2% of pay up to the maximum
> taxable amount; agencies automatically contribute an amount equal to
> 1% of employee pay to the TSP; and agencies also make matching
> contributions to the TSP.
>
> At the start of FY2004, the Civil Service Retirement and Disability
> Fund had
>
> an *unfunded liability* of \$527 billion, consisting of a \$539
> billion deficit for CSRS and a \$12 billion surplus for FERS. Although
> the civil service trust fund has an unfunded liability, it is not in
> danger of becoming insolvent. At no point over the next 75 years will
> the fund be exhausted. The Civil Service Retirement and Disability
> Trust Fund is invested in special-issue U.S. Treasury bonds.

[]{.mark}

For more information on these retirement systems, visit this webpage:
<http://www.congress.gov/erp/rl/pdf/98-810.pdf>.

[]{.mark}

**[RSC Bonus Fact]{.underline}**: The U.S. Constitution does not provide
for the *automatic* removal of a Member of Congress convicted of any
crime. Article I, Section 5, Clause 2 provides that either House could
(but does not *have* to) expel a Member---for any reason---with a
two-thirds vote.

**[Committee Action]{.underline}**: On January 16, 2007, the bill was
referred to the Oversight and Government Reform Committee, as well as
the Committee on House Administration, neither of which took subsequent
public action.

**[Possible Conservative Concerns]{.underline}**: Some conservatives
might be concerned that this legislation would allow for the full
payment of retirement benefits to the spouse or children of a convicted
Member of Congress, since the convicted Member may still be able to gain
access to such funds.

**[Cost to Taxpayers]{.underline}**: This legislation would yield no
costs to taxpayers and could yield (insignificant) savings to taxpayers.

**[Does the Bill Expand the Size and Scope of the Federal
Government?]{.underline}**: No.

**[Does the Bill Contain Any New State-Government, Local-Government, or
Private-Sector Mandates?]{.underline}**: No.

**[Does the Bill Comply with House Rules Regarding
Earmarks?]{.underline}**: The earmarks rules do not apply, by
definition, to bills considered under suspension of the rules.

**[Constitutional Authority]{.underline}**: A committee report citing
constitutional authority is unavailable. Article I, Section 6, Clause 1
of the Constitution provides that, "The Senators and Representatives
shall receive a Compensation for their Services, to be ascertained by
Law, and paid out of the Treasury of the United States."

**[RSC Staff Contact]{.underline}**: Paul S. Teller,
<paul.teller@mail.house.gov>, (202) 226-9718