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[House Report 114-765]
[From the U.S. Government Publishing Office]

114th Congress    }                                    {        Report
                        HOUSE OF REPRESENTATIVES
 2d Session       }                                    {       114-765

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      FULL ANNUITY SUPPLEMENT FOR CERTAIN AIR TRAFFIC CONTROLLERS

                                _______
                                

 September 20, 2016.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                                _______
                                

 Mr. Chaffetz, from the Committee on Oversight and Government Reform, 
                        submitted the following

                              R E P O R T

                        [To accompany H.R. 5785]

    The Committee on Oversight and Government Reform, to whom 
was referred the bill (H.R. 5785) to amend title 5, United 
States Code, to provide for an annuity supplement for certain 
air traffic controllers, having considered the same, report 
favorably thereon without amendment and recommend that the bill 
do pass.

                                CONTENTS

                                                                   Page
Committee Statement and Views....................................     1
Section-by-Section...............................................     3
Explanation of Amendments........................................     3
Committee Consideration..........................................     3
Roll Call Votes..................................................     3
Application of Law to the Legislative Branch.....................     3
Statement of Oversight Findings and Recommendations of the 
  Committee......................................................     4
Statement of General Performance Goals and Objectives............     4
Duplication of Federal Programs..................................     4
Disclosure of Directed Rule Makings..............................     4
Federal Advisory Committee Act...................................     4
Unfunded Mandate Statement.......................................     4
Earmark Identification...........................................     4
Committee Estimate...............................................     4
Budget Authority and Congressional Budget Office Cost Estimate...     5
Changes in Existing Law Made by the Bill, as Reported............     5

                     Committee Statement and Views

                          PURPOSE AND SUMMARY

    H.R. 5785, to amend title 5, United States Code, to provide 
for an annuity supplement for certain air traffic controllers, 
exempts full-time air traffic control instructors under 
contract with the Federal Aviation Administration (FAA) from 
the reduction to the Federal Employees Retirement System (FERS) 
annuity supplement when an annuitant receives excess earnings. 
The bill incentivizes former air traffic controllers to 
continue service after mandatory retirement as full-time 
contracted air traffic controller instructors.

                  BACKGROUND AND NEED FOR LEGISLATION

    The FAA is responsible for the safety of America's airways. 
It employs uniquely skilled and highly trained air traffic 
controllers (ATCs) to ensure smooth and safe operations across 
the country. However, FAA is facing a growing critical shortage 
of trained controllers. Approximately 6,000 new ATCs will need 
to be hired in the next five years alone.
    In order to meet this hiring challenge, FAA needs qualified 
ATC instructors to train the new hires. FAA regulations, 
however, are very strict on who may become an ATC instructor. 
Generally, ATC instructors must have been an active FAA 
controller for some part of their career and within the 
previous five years prior to applying for a contract instructor 
position.\1\ This limits the pool of available ATC instructors.
---------------------------------------------------------------------------
    \1\Memorandum from SAIC to Republican and Democratic Staff on the 
H. Comm. on Oversight & Gov't Reform, Retirement Income Limit Waiver 
for Air Traffic Controller Instructors (July 28, 2016).
---------------------------------------------------------------------------
    FAA relies upon contracted ATC instructors and awarded a 
competitively bid contract in 2015 to train the new corps of 
controllers at facilities located mostly in Oklahoma City, 
Oklahoma, and Washington, D.C.\2\ Under the contract, the 
awardee is the only provider of this service to the FAA. 
Unfortunately, the awardee has found it difficult to attract 
ATC instructors to work, in part because of the FAA regulations 
restricting contracted ATC instructor eligibility.\3\
---------------------------------------------------------------------------
    \2\SAIC, Press Release, SAIC Awarded $425 Million Controller 
Training Contract by FAA (May 4, 2015).
    \3\Retirement Income Limit Waiver for Air Traffic Controller 
Instructors, supra note 1.
---------------------------------------------------------------------------
    In other main cause of the hiring challenges is the excess 
earnings reduction to which ATCs are subject upon retirement. 
With limited exceptions, ATCs who join the FAA under FERS are 
required to retire at the age of 56 due to the strenuous nature 
of their jobs.\4\ Upon retirement, they are eligible for a FERS 
annuity supplement that approximates what they would earn in 
Social Security benefits until age 62.\5\ This annuity 
supplement is necessary because Social Security benefits do not 
begin until the age of 62.
---------------------------------------------------------------------------
    \4\5 U.S.C. Sec.  8335
    \5\5 U.S.C. Sec.  8421
---------------------------------------------------------------------------
    The annuity supplement is currently subject to an excess 
earnings reduction in 5 U.S.C. 8421a(a) for every dollar earned 
over the Social Security earnings limits of $15,720 per 
year.\6\ Thus, retired ATCs who receive compensation greater 
than the earnings limitation could forfeit a portion or the 
entire amount of their FERS annuity supplement, depending on 
the amount of their earnings. H.R. 5785 would alter this 
dynamic. It would incentivize former ATCs to become full-time 
instructors after retirement by eliminating the earnings cap 
while they are instructors and allowing them to continue to 
receive their full FERS annuity supplement. These instructors 
would help train the next generation of ATCs and maintain the 
security of the nation's airways.
---------------------------------------------------------------------------
    \6\5 U.S.C. Sec.  8421a.
---------------------------------------------------------------------------

                          LEGISLATIVE HISTORY

    H.R. 5785 was introduced on July 14, 2016 by Representative 
Steve Russell (R-OK) and referred to the Committee on Oversight 
and Government Reform. On September 15, 2016, the Committee on 
Oversight and Government Reform ordered H.R. 5785 favorably 
reported by unanimous consent, without amendment.
    Additionally, the text of this bill passed the Senate by a 
vote of 95-3 on April 19, 2016 as part of the Senate amendment 
to H.R. 636, the FAA Extension, Safety, and Security Act of 
2016, but it was among a number of provisions not ultimately 
included in the final version of H.R. 636 that became law on 
July 15, 2016.
    A similar bill to H.R. 5785, S. 3217, was introduced by 
Sen. James Inhofe (R-OK) on July 14, 2016 and referred to the 
Senate Committee on Homeland Security and Governmental Affairs.

                           Section-by-Section

Section 1. Full annuity supplement for certain air traffic controllers

    Amends Section 8421a of title 5, United States Code, to 
exempt former air traffic controllers under contract with the 
Federal Aviation Administration as full-time instructors from a 
reduction to the Federal Employees Retirement System (FERS) 
annuity supplement when an annuitant receives earnings above 
the Social Security earnings limit.

                       Explanation of Amendments

    No amendments to H.R. 5785 were offered or adopted during 
Full Committee consideration of the bill.

                        Committee Consideration

    On September 15, 2016 the Committee met in open session and 
ordered reported favorably the bill, H.R. 5785, by unanimous 
consent, a quorum being present.

                            Roll Call Votes

    No roll call votes were requested or conducted during Full 
Committee consideration of H.R. 5785.

              Application of Law to the Legislative Branch

    Section 102(b)(3) of Public Law 104-1 requires a 
description of the application of this bill to the legislative 
branch where the bill relates to the terms and conditions of 
employment or access to public services and accommodations. 
This bill amends title 5, United States Code, to provide for an 
annuity supplement for certain air traffic controllers. As such 
this bill does not relate to employment or access to public 
services and accommodations.

  Statement of Oversight Findings and Recommendations of the Committee

    In compliance with clause 3(c)(1) of rule XIII and clause 
2(b)(1) of rule X of the Rules of the House of Representatives, 
the Committee's oversight findings and recommendations are 
reflected in the descriptive portions of this report.

         Statement of General Performance Goals and Objectives

    In accordance with clause 3(c)(4) of rule XIII of the Rules 
of the House of Representatives, the Committee's performance 
goal or objective is to amend title 5, United States Code, to 
provide for an annuity supplement for certain air traffic 
controllers.

                    Duplication of Federal Programs

    No provision of this bill establishes or reauthorizes a 
program of the Federal Government known to be duplicative of 
another Federal program, a program that was included in any 
report from the Government Accountability Office to Congress 
pursuant to section 21 of Public Law 111-139, or a program 
related to a program identified in the most recent Catalog of 
Federal Domestic Assistance.

                  Disclosure of Directed Rule Makings

    The Committee estimates that enacting this bill does not 
direct the completion of any specific rule makings within the 
meaning of 5 U.S.C. 551.

                     Federal Advisory Committee Act

    The Committee finds that the legislation does not establish 
or authorize the establishment of an advisory committee within 
the definition of 5 U.S.C. App., Section 5(b).

                       Unfunded Mandate Statement

    Section 423 of the Congressional Budget and Impoundment 
Control Act (as amended by Section 101(a)(2) of the Unfunded 
Mandates Reform Act, P.L. 104-4) requires a statement as to 
whether the provisions of the reported include unfunded 
mandates. In compliance with this requirement the Committee has 
received a letter from the Congressional Budget Office included 
herein.

                         Earmark Identification

    This bill does not include any congressional earmarks, 
limited tax benefits, or limited tariff benefits as defined in 
clause 9 of rule XXI.

                           Committee Estimate

    At the time of this writing, the Committee had yet to 
receive a formal cost estimate from the Congressional Budget 
Office for H.R. 5785. However, preliminary analysis from CBO 
suggests that the bill would provide for no significant 
budgetary effects.

     Budget Authority and Congressional Budget Office Cost Estimate

    With respect to the requirements of clause 3(c)(2) of rule 
XIII of the Rules of the House of Representatives and section 
308(a) of the Congressional Budget Act of 1974 and with respect 
to requirements of clause (3)(c)(3) of rule XIII of the Rules 
of the House of Representatives and section 402 of the 
Congressional Budget Act of 1974, the Committee has not 
received a cost estimate for this bill from the Director of 
Congressional Budget Office, and instead has included a 
committee estimate in the section prior to this one.

         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, and existing law in which no 
change is proposed is shown in roman):

                      TITLE 5, UNITED STATES CODE

           *       *       *       *       *       *       *
PART III--EMPLOYEES

           *       *       *       *       *       *       *

SUBPART G--INSURANCE AND ANNUITIES

           *       *       *       *       *       *       *

CHAPTER 84--FEDERAL EMPLOYEES' RETIREMENT SYSTEM

           *       *       *       *       *       *       *

SUBCHAPTER II--BASIC ANNUITY

           *       *       *       *       *       *       *

Sec. 8421a. Reductions on account of earnings from work performed while 
                    entitled to an annuity supplement

  (a) [The amount] Except as provided in subsection (c), the 
amount of the annuity supplement to which an individual is 
entitled under section 8421 for any month (determined without 
regard to subsection (c) of such section) shall be reduced by 
the amount of any excess earnings of such individual which are 
required to be charged to such supplement for such month, as 
determined under subsection (b).
  (b) The amount of an individual's excess earnings shall be 
charged to months as follows:
          (1)(A) There shall be charged to each month of a year 
        under subsection (a) an amount equal to the 
        individual's excess earnings (as determined under 
        paragraph (2) with respect to such year), divided by 
        the number of the individual's supplement entitlement 
        months for such year (as determined under paragraph 
        (3)).
          (B) Notwithstanding subparagraph (A), the amount 
        charged to a month under subsection (a) may not exceed 
        the amount of the annuity supplement to which the 
        individual is entitled under section 8421 for such 
        month (determined without regard to subsection (c) of 
        such section).
          (2) The excess earnings based on which reductions 
        under subsection (a) shall be made with respect to an 
        individual in a year--
                  (A) shall be equal to 50 percent of so much 
                of such individual's earnings for the 
                immediately preceding year as exceeds the 
                applicable exempt amount for such preceding 
                year; but
                  (B) may not exceed the total amount of the 
                annuity supplement payments to which such 
                individual was entitled for such preceding year 
                under section 8421 (determined without regard 
                to subsection (c) of such section, and without 
                regard to this section).
          (3)(A) Subject to subparagraph (B), the number of an 
        individual's supplement entitlement months for a year 
        shall be 12.
          (B) The number determined under subparagraph (A) 
        shall be reduced so as not to include any month after 
        which such individual ceases to be entitled to an 
        annuity supplement by reason of section 8421(a)(3)(B), 
        relating to cessation of entitlement upon attaining age 
        62.
          (4)(A) For purposes of this section, and except as 
        provided in subparagraph (B), the ``earnings'' and the 
        ``applicable exempt amount'' of an individual shall be 
        determined in a manner consistent with applicable 
        provisions of section 203 of the Social Security Act.
          (B) For purposes of this section--
                  (i) in determining the excess earnings of any 
                individual, only earnings attributable to 
                periods during which such individual was 
                entitled to an annuity supplement under section 
                8421 shall be considered; and
                  (ii) any earnings attributable to a period 
                before attaining the applicable retirement age 
                under section 8412(h) shall not be considered 
                in determining the excess earnings of an 
                individual who retires under section 8412(d) or 
                (e), or section 8414(c).
          (5) Notwithstanding paragraphs (1) through (4), the 
        reduction required by subsection (a) shall be effective 
        with respect to the annuity supplement payable for each 
        month in the 12-month period beginning on the first day 
        of the seventh month after the end of the calendar year 
        in which the excess earnings were earned.
  (c) This section shall not apply to an individual described 
in section 8412(e) during any period in which the individual, 
after separating from the service as described in that section, 
is employed full-time as an air traffic control instructor 
under contract with the Federal Aviation Administration, 
including an instructor working at an on-site facility (such as 
an airport).
  [(c)] (d) The Office shall prescribe regulations under which 
this section shall be applied in the case of a reemployed 
annuitant.

           *       *       *       *       *       *       *

                                  [all]
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