PUBLIC LAW 108–489—DEC. 23, 2004

DISTRICT OF COLUMBIA RETIREMENT

PROTECTION IMPROVEMENT ACT OF 2004

118 STAT. 3966 PUBLIC LAW 108–489—DEC. 23, 2004

Public Law 108–489

108th Congress

An Act

To amend the Balanced Budget Act of 1997 to improve the administration of

Federal pension benefit payments for District of Columbia teachers, police officers,

and fire fighters, and for other purposes.

Be it enacted by the Senate and House of Representatives of

the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘‘District of Columbia Retirement

Protection Improvement Act of 2004’’.

SEC. 2. ESTABLISHMENT OF DISTRICT OF COLUMBIA FEDERAL PENSION FUND FOR PAYMENT OF FEDERAL BENEFIT PAYMENTS TO DISTRICT OF COLUMBIA TEACHERS, POLICE

OFFICERS, AND FIRE FIGHTERS.

(a) IN GENERAL.—Subtitle A of title XI of the Balanced Budget

Act of 1997 (sec. 1—801.01 et seq., D.C. Official Code) is amended—

(1) by redesignating chapter 9 as chapter 10;

(2) by redesignating sections 11081 through 11087 as sections 11091 through 11097; and

(3) by inserting after chapter 8 the following new chapter:

‘‘CHAPTER 9—DISTRICT OF COLUMBIA FEDERAL

PENSION FUND

‘‘SEC. 11081. CREATION OF FUND.

‘‘(a) ESTABLISHMENT.—There is established on the books of the

Treasury the District of Columbia Teachers, Police Officers, and

Firefighters Federal Pension Fund (hereafter referred to as the

‘D.C. Federal Pension Fund’), consisting of the following:

‘‘(1) The assets transferred pursuant to section 11083.

‘‘(2) The annual Federal payments deposited pursuant to

section 11084.

‘‘(3) Any amounts otherwise appropriated to such Fund.

‘‘(4) Any income earned on the investment of the assets

of such Fund pursuant to subsection (b).

‘‘(b) INVESTMENT OF ASSETS.—The Secretary shall invest such

portion of the assets of the D.C. Federal Pension Fund as is not

in the judgment of the Secretary required to meet current withdrawals. Such investments shall be in public debt securities with

maturities suitable to the needs of the D.C. Federal Pension Fund,

as determined by the Secretary, and bearing interest at rates determined by the Secretary, taking into consideration current market

yields on outstanding marketable obligations of the United States

of comparable maturities.

District of

Columbia

Retirement

Protection

Improvement Act

of 2004.

Dec. 23, 2004

[H.R. 4657]

PUBLIC LAW 108–489—DEC. 23, 2004 118 STAT. 3967

‘‘(c) RECORDKEEPING FOR ACTUARIAL STATUS.—The Secretary

shall provide for the keeping of such records as are necessary

for determining the actuarial status of the D.C. Federal Pension

Fund.

‘‘SEC. 11082. USES OF AMOUNTS IN FUND.

‘‘(a) IN GENERAL.—Amounts in the D.C. Federal Pension Fund

shall be used—

‘‘(1) to make Federal benefit payments under this subtitle;

‘‘(2) subject to subsection (b), to cover the reasonable and

necessary administrative expenses incurred by any person in

administering the D.C. Federal Pension Fund and carrying

out this chapter;

‘‘(3) for the accumulation of funds in order to finance obligations of the Federal Government for future benefits; and

‘‘(4) for such other purposes as are specified in this subtitle.

‘‘(b) BUDGETING, CERTIFICATION, AND APPROVAL OF ADMINISTRA- TIVE EXPENSES.—The administrative expenses of the D.C. Federal

Pension Fund shall be paid in accordance with an annual budget

set forth by the Pension Fund Trustee which shall be subject

to certification and approval by the Secretary.

‘‘SEC. 11083. TRANSFER OF ASSETS AND OBLIGATIONS OF TRUST FUND

AND FEDERAL SUPPLEMENTAL FUND.

‘‘(a) TRANSFER OF OBLIGATIONS.—Effective October 1, 2004, all

obligations to make Federal benefit payments shall be transferred

from the Trust Fund to the D.C. Federal Pension Fund.

‘‘(b) TRANSFER OF ASSETS.—Effective October 1, 2004, all assets

of the Trust Fund and all assets of the Federal Supplemental

Fund as of such date shall be transferred to the D.C. Federal

Pension Fund.

‘‘SEC. 11084. DETERMINATION OF ANNUAL FEDERAL PAYMENTS INTO

D.C. FEDERAL PENSION FUND.

‘‘(a) ANNUAL AMORTIZATION AMOUNT.—

‘‘(1) IN GENERAL.—At the end of each fiscal year (beginning

with fiscal year 2005), the Secretary shall promptly pay into

the D.C. Federal Pension Fund from the general fund of the

Treasury an amount equal to the annual amortization amount

for the year (which may not be less than zero).

‘‘(2) DETERMINATION OF AMOUNT.—For purposes of paragraph (1)—

‘‘(A) the ‘original unfunded liability’ is the present value

as of the effective date of this Act of expected future benefits

payable from the Federal Supplemental Fund; and

‘‘(B) the ‘annual amortization amount’ means the

amount determined by the enrolled actuary to be necessary

to amortize in equal annual installments (until fully amortized)—

‘‘(i) the original unfunded liability over a 30-year

period,

‘‘(ii) a net experience gain or loss over a 10-year

period, and

‘‘(iii) any other changes in actuarial liability over

a 20-year period.

‘‘(3) SCHEDULE FOR AMORTIZATION.—In determining the

annual amortization amount under paragraph (2)(B), the

enrolled actuary shall include amounts necessary to complete

Effective date.

Effective dates.

118 STAT. 3968 PUBLIC LAW 108–489—DEC. 23, 2004

the amortization schedules used for determining the annual

amortization amount for payments into the Federal Supplemental Fund under section 11053 (as in effect prior to the

enactment of this chapter).

‘‘(b) ADMINISTRATIVE EXPENSES.—During each fiscal year

(beginning with fiscal year 2009), the Secretary shall pay into

the D.C. Federal Pension Fund from the general fund of the

Treasury the amounts necessary to pay the reasonable and necessary administrative expenses described in section 11082(a)(2) for

the year.

‘‘SEC. 11085. ADMINISTRATION THROUGH PENSION FUND TRUSTEE.

‘‘(a) IN GENERAL.—The Secretary shall select a Pension Fund

Trustee to carry out the responsibilities and duties specified in

this subtitle in accordance with the contract described in subsection

(b).

‘‘(b) CONTRACT.—The Secretary shall enter into a contract with

the Pension Fund Trustee to provide for the auditing of D.C. Federal

Pension Fund assets, the making of Federal benefit payments under

this subtitle from the D.C. Federal Pension Fund, and such other

matters as the Secretary deems appropriate. The Secretary shall

enforce the provisions of the contract and otherwise monitor the

administration of the D.C. Federal Pension Fund.

‘‘(c) SUBCONTRACTS.—Notwithstanding any provision of a District Retirement Program or any other law, rule, or regulation,

the Pension Fund Trustee may, with the approval of the Secretary,

enter into one or more subcontracts with the District Government

or any person to provide services to the Pension Fund Trustee

in connection with its performance of the contract. The Pension

Fund Trustee shall monitor the performance of any such subcontract

and enforce its provisions.

‘‘(d) DETERMINATION BY THE SECRETARY.—Notwithstanding subsection (b) or any other provision of this subtitle, the Secretary

may determine, with respect to any function otherwise to be performed by the Pension Fund Trustee, that in the interest of economy

and efficiency such function shall be performed by the Secretary

rather than the Pension Fund Trustee.

‘‘(e) REPORTS.—The Pension Fund Trustee shall report to the

Secretary, in a form and manner and at such intervals as the

Secretary may prescribe, on any matters under the responsibility

of the Pension Fund Trustee as the Secretary may prescribe.

‘‘SEC. 11086. APPLICABILITY OF OTHER PROVISIONS TO D.C. FEDERAL

PENSION FUND.

‘‘The following provisions of this subtitle shall apply with

respect to the D.C. Federal Pension Fund in the same manner

as such provisions applied with respect to the Trust Fund prior

to October 1, 2004:

‘‘(1) Section 11023(b) (relating to the repayment by the

District Government of costs attributable to errors or omissions

in transferred records).

‘‘(2) Section 11034 (relating to the treatment of the Trust

Fund under certain laws).

‘‘(3) Section 11061 (relating to annual valuations and

reports by the enrolled actuary), except that in applying section

11061(b) to the D.C. Federal Pension Fund, the annual report

required under such section shall include a determination of

Effective date.

PUBLIC LAW 108–489—DEC. 23, 2004 118 STAT. 3969

the annual payment to the D.C. Federal Pension Fund under

section 11084.

‘‘(4) Section 11062 (relating to reports by the Comptroller

General).

‘‘(5) Section 11071 (relating to judicial review).

‘‘(6) Section 11074 (relating to the treatment of misappropriation of Trust Fund amounts as a Federal crime).’’.

(b) TERMINATION OF CURRENT FUNDS.—

(1) DISTRICT OF COLUMBIA FEDERAL PENSION LIABILITY

TRUST FUND.—Chapter 4 of subtitle A of title XI of such Act

(sec. 1—807.01 et seq., D.C. Official Code) is amended by adding

at the end the following new section:

‘‘SEC. 11036. TERMINATION OF TRUST FUND.

‘‘Effective upon the transfer of the obligations and assets of

the Trust Fund to the D.C. Federal Pension Fund under section

11083—

‘‘(1) the Trust Fund shall terminate; and

‘‘(2) the obligation to make Federal benefit payments from

the Trust Fund, and any duty imposed on any person with

respect to the Trust Fund, shall terminate.’’.

(2) FEDERAL SUPPLEMENTAL DISTRICT OF COLUMBIA PENSION

FUND.—Chapter 6 of subtitle A of title XI of such Act (sec.

1—811.01 et seq., D.C. Official Code) is amended by adding

at the end the following new section:

‘‘SEC. 11056. TERMINATION OF FEDERAL SUPPLEMENTAL FUND.

‘‘Effective upon the transfer of the assets of the Federal Supplemental Fund to the D.C. Federal Pension Fund under section

11083—

‘‘(1) the Federal Supplemental Fund shall terminate; and

‘‘(2) any duty imposed on any person with respect to the

Federal Supplemental fund shall terminate.’’.

(c) CONFORMING DEFINITIONS.— (1) TRUSTEE.—Section 11003(16) of such Act (sec. 1—

801.02(16), D.C. Official Code) is amended by striking the period

at the end and inserting the following: ‘‘, or, beginning October

1, 2004, the Pension Fund Trustee selected by the Secretary

under section 11085.’’.

(2) D.C. FEDERAL PENSION FUND.—Section 11003 of such

Act (sec. 1—801.02, D.C. Official Code) is amended—

(A) by redesignating paragraphs (3) through (16) as

paragraphs (4) through (17); and

(B) by inserting after paragraph (2) the following new

paragraph:

‘‘(3) The term ‘D.C. Federal Pension Fund’ means the District of Columbia Teachers, Police Officers, and Firefighters

Federal Pension Fund established under section 11081.’’.

(d) OTHER CONFORMING AMENDMENT.—Section 11041(b) of such

Act (sec. 1—809.01(b), D.C. Official Code) is amended in the heading

by striking ‘‘FROM TRUST FUND’’.

(e) CLERICAL AMENDMENTS.—The table of contents of subtitle

A of title XI of such Act is amended—

(1) by adding at the end of the items relating to chapter

4 the following:

‘‘Sec. 11036. Termination of Trust Fund.’’;

Effective date.

Effective date.

118 STAT. 3970 PUBLIC LAW 108–489—DEC. 23, 2004

(2) by adding at the end of the items relating to chapter

6 the following:

‘‘Sec. 11056. Termination of Federal Supplemental Fund.’’;

(3) by redesignating the item relating to chapter 9 as

relating to chapter 10;

(4) by redesignating the items relating to sections 11081

through 11087 as relating to sections 11091 through 11097;

and

(5) by inserting after the items relating to chapter 8 the

following:

‘‘CHAPTER 9—DISTRICT OF COLUMBIA FEDERAL PENSION FUND

‘‘Sec. 11081. Creation of Fund.

‘‘Sec. 11082. Uses of Amounts in Fund.

‘‘Sec. 11083. Transfer of Assets and Obligations of Trust Fund and Federal Supplemental Fund.

‘‘Sec. 11084. Determination of Annual Federal Payment Into D.C. Federal Pension

Fund.

‘‘Sec. 11085. Administration Through Pension Fund Trustee.

‘‘Sec. 11086. Applicability of Other Provisions to D.C. Federal Pension Fund.’’.

SEC. 3. ADMINISTRATION OF DISTRICT OF COLUMBIA JUDICIAL

RETIREMENT AND SURVIVORS ANNUITY FUND.

(a) PROCEDURES FOR RESOLVING DENIED BENEFIT CLAIMS.—

(1) IN GENERAL.—Section 11—1570(c), D.C. Official Code,

is amended by adding at the end the following new paragraph:

‘‘(3)(A) In accordance with procedures approved by the Secretary, the Secretary shall provide to any individual whose

claim for a benefit under this subchapter has been denied

in whole or in part—

‘‘(i) adequate written notice of such denial, setting forth

the specific reasons for the denial in a manner calculated

to be understood by the average participant in the program

of benefits under this subchapter; and

‘‘(ii) a reasonable opportunity for a full and fair review

of the decision denying such claim.

‘‘(B) Any factual determination made by the Secretary

pursuant to this paragraph shall be presumed correct unless

rebutted by clear and convincing evidence. The Secretary’s

interpretation and construction of the benefit provisions of this

subchapter shall be entitled to great deference.’’.

(2) EFFECTIVE DATE.—The amendment made by paragraph

(1) shall apply with respect to claims for benefits which are

made after the date of the enactment of this Act.

(b) TREATMENT OF MISAPPROPRIATION OF FUND AMOUNTS AS

FEDERAL CRIME.— (1) IN GENERAL.—Section 11—1570, D.C. Official Code, is

amended by adding at the end the following new subsection:

‘‘(l) The provisions of section 664 of title 18, United States

Code (relating to theft or embezzlement from employee benefit

plans), shall apply to the Fund.’’.

(2) EFFECTIVE DATE.—The amendment made by paragraph

(1) shall take effect on the date of the enactment of this Act.

SEC. 4. ADMINISTRATION OF RETIREMENT PROGRAM FOR POLICE

OFFICERS, FIRE FIGHTERS, AND TEACHERS BY OTHER

THAN CHIEF FINANCIAL OFFICER.

(a) IN GENERAL.—Section 424(c)(21) of the District of Columbia

Home Rule Act (sec. 1—204.24c(21), D.C. Official Code) is amended

Notice.

PUBLIC LAW 108–489—DEC. 23, 2004 118 STAT. 3971

LEGISLATIVE HISTORY—H.R. 4657:

CONGRESSIONAL RECORD, Vol. 150 (2004):

Sept. 28, considered and passed House.

Dec. 8, considered and passed Senate.

Æ

by striking ‘‘systems’’ and inserting the following: ‘‘systems (other

than the retirement system for police officers, fire fighters, and

teachers)’’.

(b) EFFECTIVE DATE.—The amendment made by subsection (a)

shall apply with respect to fiscal year 2005 and each succeeding

fiscal year.

Approved December 23, 2004.