U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 

1 

89–010 

" ! SENATE 

111TH CONGRESS

2d Session 

REPORT

2010

111–231 

Calendar No. 484 

UNITED STATES SECRET SERVICE 

RETIREMENT ACT OF 2009 

R E P O R T 

OF THE

COMMITTEE ON HOMELAND SECURITY AND 

GOVERNMENTAL AFFAIRS 

UNITED STATES SENATE 

TO ACCOMPANY

S. 1862 

TO PROVIDE THAT CERTAIN SECRET SERVICE EMPLOYEES MAY 

ELECT TO TRANSITION TO COVERAGE UNDER THE DISTRICT OF 

COLUMBIA POLICE AND FIRE FIGHTER RETIREMENT AND DISABILITY SYSTEM 

JULY 26, 2010.—Ordered to be printed 


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(II) 

COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS 

JOSEPH I. LIEBERMAN, Connecticut, Chairman 

CARL LEVIN, Michigan 

DANIEL K. AKAKA, Hawaii 

THOMAS R. CARPER, Delaware 

MARK L. PRYOR, Arkansas 

MARY L. LANDRIEU, Louisiana 

CLAIRE MCCASKILL, Missouri 

JON TESTER, Montana 

ROLAND W. BURRIS, Illinois 

EDWARD E. KAUFMAN, Delaware 

SUSAN M. COLLINS, Maine 

TOM COBURN, Oklahoma 

SCOTT P. BROWN, Massachusetts 

JOHN MCCAIN, Arizona 

GEORGE V. VOINOVICH, Ohio 

JOHN ENSIGN, Nevada 

LINDSEY GRAHAM, South Carolina 

MICHAEL L. ALEXANDER, Staff Director 

KEVIN J. LANDY, Chief Counsel 

KENYA N. WILEY, Counsel 

BRANDON L. MILHORN, Minority Staff Director and Chief Counsel 

AMANDA WOOD, Minority Director for Governmental Affairs 

TRINA DRIESSNACK TYRER, Chief Clerk 


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Calendar No. 484 

111TH CONGRESS SENATE REPORT " ! 2d Session 111–231 

UNITED STATES SECRET SERVICE RETIREMENT 

ACT OF 2009 

JULY 26, 2010.—Ordered to be printed 

Mr. LIEBERMAN, from the Committee on Homeland Security and 

Governmental Affairs, submitted the following 

REPORT 

[To accompany S. 1862] 

The Committee on Homeland Security and Governmental Affairs, 

to which was referred the bill (S. 1862) to provide that certain Secret Service employees may elect to transition to coverage under 

the District of Columbia Police and Fire Fighter Retirement and 

Disability System, having considered the same, reports favorably 

thereon without amendment and recommends that the bill do pass. 

CONTENTS 

Page 

I. Purpose and Summary .................................................................................. 1 

II. Background and Need for the Legislation ................................................... 2 

III. Legislative History ......................................................................................... 3 

IV. Section-by-Section Analysis .......................................................................... 3 

V. Evaluation of Regulatory Impact .................................................................. 4 

VI. Congressional Budget Office Estimate ......................................................... 5 

VII. Changes in Existing Law Made by the Bill, as Reported ........................... 8 

I. PURPOSE AND SUMMARY

The purpose of S. 1862 is to permit certain employees of the U.S. 

Secret Service (USSS) who were hired between January 1, 1984 

and December 31, 1986, to transfer from the Federal Employees’ 

Retirement System (FERS) to the District of Columbia Police and 

Firefighter Retirement and Disability System (DC Retirement System). The bill would thereby resolve a longstanding dispute between the federal government and these employees regarding the 

employees’ appropriate retirement coverage and help ensure that 

the USSS does not lose a significant number of highly experienced 

and critical personnel. 


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1 Unlike Uniformed Division Officers, who were automatically placed into the DC Retirement 

System, agents who were hired before January 1, 1984 who had accrued 10 years of protection 

time were eligible to transfer into the DC Retirement System. 2The USSS reimburses the District of Columbia on a monthly basis to cover the cost of annuity benefits for UD officers and agents, pursuant to P.L. 71–221 and P.L. 76–847. 3See USSS memorandum on the District of Columbia Police and Firefighters Retirement and 

Disability System, March 27, 2001. 4 Numerous agents and officers submitted letters to senior USSS employees attesting that 

when they were recruited, they were informed of the generous retirement system and the ability 

to participate in the DC Retirement System. 5The USSS agents and UD officers have pursued actions to participate in the DC Retirement 

System through the Office of Personnel Management (OPM), the Merit Systems Protection 

Board (MSPB), the U.S. Secret Service, and the U.S. District Court for the District of Columbia. 6The number of FERS retirees covered under S. 1862 retiring every year has increased from 

4 retirees in Fiscal Year 2004 to 10 retirees in Fiscal Year 2009. Currently, 146 agents and officers hired between 1984 and 1986 are eligible to retire. 

II. BACKGROUND AND NEED FOR THE LEGISLATION

The Uniformed Division (UD) of the USSS has its origins in a 

local District of Columbia special police force dedicated to protecting the White House, known as the White House Police. Although UD officers became federal employees in the first half of the 

last century, the local origins of the USSS led to an unusual situation in which these federal employees, as well as their colleagues 

in the Secret Service division responsible for protecting current and 

former Presidents and their families (Secret Service agents),1 received their retirement coverage under the DC Retirement System.2 That began to change in the mid-1980s, when Congress enacted sweeping reforms to Federal employees’ retirement coverage. 

The Federal Employees’ Retirement System Act of 1986 (‘‘the FERS 

Act’’) began the process of phasing out the Civil Service Retirement 

System (CSRS) by putting most federal employees hired thereafter 

into the Federal Employees’ Retirement System, which was slated 

to be up and running in 1987. The FERS Act required Federal employees to make Social Security contributions and made them eligible for Social Security benefits upon retirement. The FERS Act also 

established the Thrift Savings Plan, a defined contribution plan 

where each employee makes contributions into an individual account. The Executive Branch has long interpreted the FERS Act as 

requiring members of the U.S. Secret Service Division (USSS 

agents) and the U.S. Secret Service Uniformed Division (UD officers) hired after December 31, 1983 to receive their retirement coverage through FERS, not the DC Retirement System.3

USSS agents and UD officers hired between January 1, 1984 and 

December 31, 1986, however, have since then alleged that the 

USSS, in part as a recruiting and subsequently retention tool, 

promised them eligibility for retirement under the more generous 

DC Retirement System.4 Many of them have filed judicial or administrative actions seeking to obtain coverage under the DC Retirement System, but they have thus far been unsuccessful in obtaining relief.5

After reviewing the matter, the Committee has determined that 

both fairness and the interests of the government in retaining the 

services of these highly qualified and experienced USSS employees 

warrants enabling certain USSS agents and UD officers to transfer 

from the FERS system to the DC Retirement System. Most importantly, as an increasing number of this group of agents and officers 

become eligible for retirement 6 without the option to elect into the 

DC Retirement System, many are leaving the Secret Service for 


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7 According to the USSS, more than 60 percent of the agents and officers eligible to retire hold 

senior leadership positions within the agency. 8The USSS informs the Committee that the bill would apply to approximately 180 employees. 

higher-paying positions in the private sector.7 The reasons are 

clear: Secret Service employees participating in the DC Retirement 

System have a significantly greater incentive to continue working 

after 20 years of service than do those covered by FERS. Those covered by the DC Retirement System receive an additional 3 percent 

of their pay for each year they work after twenty years of service, 

while FERS employees receive only an additional 1 percent for 

each year over twenty. 

To remedy this situation, S. 1862 would offer a very carefully defined group of UD officers and Secret Service agents the opportunity to transfer into the DC Retirement System.8 Only agents 

and officers hired between January 1, 1984 and December 31, 1986 

would be eligible to transfer into the DC Retirement System. In 

order to make the transfer, the employees would have to apply and 

would agree to give up certain benefits they received under FERS, 

such as eligibility to receive Social Security in the future. Also, S. 

1862 would only apply to current Secret Service employees, and 

thus, this legislation would not be applicable to current retirees 

who were hired between January 1, 1984 and December 31, 1986. 

III. LEGISLATIVE HISTORY

S. 1862 was introduced by Senator Lieberman on October 22, 

2009 and referred to the Committee. Senator Akaka was added as 

a cosponsor on October 29, 2009. The Committee considered the bill 

on November 4, 2009, and then reported the bill to the full Senate 

favorably by voice vote. Chairman Lieberman, Senators Levin, 

Akaka, Carper, Pryor, Landrieu, Burris, Collins, and Bennett were 

present. 

IV. SECTION-BY-SECTION ANALYSIS

Section 1. Short title 

This section provides that the short title of the bill is the ‘‘United 

States Secret Service Retirement Act of 2009.’’ 

Section 2. Retirement treatment of certain Secret Service employees 

This section sets forth the criteria for coverage under S. 1862 

and the procedures for transferring covered USSS employees from 

FERS to the DC Retirement System. 

Subsection (a) defines ‘‘covered employees’’ as individuals who: 

(1) were hired as members of the U.S. Secret Service Division 

(USSS agents) or the U.S. Secret Service Uniformed Division (UD 

officers) between January 1, 1984 through December 31, 1986; (2) 

actively performed duties directly related to the protection mission 

of the USSS for 10 or more years; (3) serve as agents or UD officers 

on the effective date of S. 1862; and (4) file an election to be covered employees under S. 1862. 

Subsection (b) provides that not later than 60 days after the date 

of enactment of this Act, covered employees under subsection (a) 

shall file an election with the USSS to be a covered employee and 

to transition to the DC Retirement System. It also requires that 

within 30 days of enactment of this Act, the Office of Personnel 


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Management and the USSS shall notify USSS employees of the enactment of S. 1862 and that covered employees are qualified to file 

an election. 

Subsection (c) provides that within 180 days of the date of enactment of this Act, and in consultation with the Secretary of Homeland Security and the Thrift Savings Board, the Office of Personnel 

Management shall prescribe regulations regarding the transition of 

covered USSS agents and UD officers from FERS to CSRS. 

Subsection (c)(2)(A) provides that after a covered employee files 

an election under subsection (b), the covered employee shall be converted from FERS to CSRS, and then to the DC Retirement System. All funds held for the covered employees shall be transferred 

from FERS to CSRS, and then to the general revenues of the District of Columbia. S. 1862 also provides that all covered employees 

shall be entitled to the same benefits as the other participants of 

the DC Retirement System. 

Subsection(c)(2)(B) provides that a covered employee who transfers to the DC Retirement System forfeits the portion of his or her 

TSP account that came from federal agency contributions and associated earnings, but keeps the portion that derived from his or her 

own contributions. Covered employees may keep the employee contributions in their TSP accounts or withdraw or transfer their contributions in accordance with the Federal Retirement Thrift Investment Board’s rules and regulations. 

Subsection (c)(2)(C) provides that upon conversion into the CSRS, 

a covered employee shall forfeit all contributions made for purposes 

of title II of the Social Security Act, meaning that, like other employees covered by the DC system, they will give up eligibility to 

receive Social Security upon retirement. Subsection (c)(2)(C) provides that S. 1862 will not affect the covered employees’ contributions to Medicare. Finally, this subsection provides that the Office 

of Personnel Management, the Department of Homeland Security, 

the Social Security Administration, and the Thrift Savings Board 

shall take the necessary actions to implement S. 1862. 

Subsection (d) provides that S. 1862 shall take effect on the first 

day of the first applicable pay period that begins 180 days after the 

date of enactment of this Act. The election of coverage pursuant to 

subsection (b) and the provisions under subsection (c)(1) and (c)(3) 

shall take effect on the date of enactment of this Act. 

V. EVALUATION OF REGULATORY IMPACT

Pursuant to the requirements of paragraph 11(b) of rule XXVI of 

the Standing Rules of the Senate, the Committee has considered 

the regulatory impact of S. 1862. The Congressional Budget Office 

states that the bill contains no intergovernmental or private-sector 

mandates as defined in the Unfunded Mandate Reform Act and 

would impose no costs on state, local, or tribal governments, or private entities. The enactment of this legislation will not have significant regulatory impact. 


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VI. CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

U.S. CONGRESS, 

CONGRESSIONAL BUDGET OFFICE, 

Washington, DC, December 3, 2009. 

Hon. JOSEPH I. LIEBERMAN, 

Chairman, Committee on Homeland Security and Governmental Affairs, U.S. Senate, Washington, DC. 

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for S. 1862, the U.S. Secret Service Retirement Act of 2009. 

If you wish further details on this estimate, we will be pleased 

to provide them. The CBO staff contact is Santiago Vallinas. 

Sincerely, 

DOUGLAS W. ELMENDORF, 

Director. 

Enclosure. 

S. 1862—United States Secret Service Retirement Act of 2009 

Summary: S. 1862 would provide a 60-day period after enactment of the bill during which certain employees of the U.S. Secret 

Service hired between January 1, 1984, and December 31, 1986, 

could elect to receive coverage under the District of Columbia Police and Firefighter Retirement and Disability System (DC system). 

Such a transition would increase benefit payments as well as affect 

individual and agency contributions to Social Security and the 

Thrift Savings Plan (TSP). 

CBO estimates that enacting S. 1862 would, on net, increase direct spending by $12 million over the 2010–2019 period, mostly as 

a result of additional retirement benefits paid to the affected employees. The bill also would eliminate employee contributions to the 

Federal Employee Retirement System (FERS) and Social Security 

by those employees, reducing revenues by $2 million over the 

2010–2019 period. On balance, CBO estimates that enacting S. 

1862 would increase the deficit by $14 million over the 2010–2019 

period, consisting of a $15 million increase in the on-budget deficit 

and a $1 million reduction in the off-budget deficit (Social Security 

effects are classified as off-budget). 

CBO also estimates that implementing the bill would lower discretionary spending by $13 million over the 2010–2019 period, because agency contributions to Social Security, FERS, and TSP on 

behalf of those employees would cease. Such reductions assume discretionary spending would be reduced by the estimated amounts. 

The bill contains no intergovernmental or private-sector mandates 

as defined in the Unfunded Mandates Reform Act (UMRA) and 

would not affect the budgets of state, local, or tribal governments. 

Estimated cost to the Federal Government: The estimated budgetary impact of S. 1862 is shown in the following table. The direct 

spending impacts of the bill fall within budget functions 600 (income security), 650 (Social Security). The discretionary costs fall 

within budget function 750 (administration of justice). 


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By fiscal year, in millions of dollars— 

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2010– 2014 2010– 2019 

CHANGES IN DIRECT SPENDING (OUTLAYS) 

Total Changes in Direct Spending ......................................................................................... * * * 1 1 2 2 2 2 2 2 12 

On-Budget Spending ..................................................................................................... * * * 1 1 2 2 2 2 2 2 14 Off-Budget Spending ..................................................................................................... 0 0 0 0 * * * * ¥1 ¥1 * ¥2 

CHANGES IN REVENUES 

Total Changes in Revenues ................................................................................................... * ¥1 ¥1 * * * 0 0 0 0 ¥2 ¥2 

On-Budget Revenues ................................................................................................... * * * * * * 0 0 0 0 ¥1 ¥1 

Off-Budget Revenues .................................................................................................... * ¥1 * * * 0 0 0 0 0 ¥1 ¥1 

NET IMPACT ON THE DEFICIT FROM REVENUES AND DIRECT SPENDING 

Net Effect on Deficit 1 ............................................................................................................ 1 1 1 1 1 2 2 2 2 2 4 14 

On-Budget Effects ......................................................................................................... * 1 * 1 1 2 2 2 2 2 3 15 Off-Budget Effects ........................................................................................................ * 1 * * * * * * ¥1 ¥1 1 ¥1 

CHANGES IN SPENDING SUBJECT TO APPROPRIATION (ON-BUDGET) 

Estimated Authorization Level ................................................................................................ * ¥2 ¥5 ¥3 ¥2 ¥1 0 0 0 0 ¥12 ¥13 

Estimated Outlays .................................................................................................................. * ¥2 ¥5 ¥3 ¥2 ¥1 0 0 0 0 ¥12 ¥13 

Memorandum: Total Intragovernmental Collections from Agency Contributions .......................................... * 2 4 3 2 1 0 0 0 0 10 11 

On-Budget ..................................................................................................................... 0 1 4 2 2 1 0 0 0 0 9 10 Off-Budget ..................................................................................................................... * 1 * * * 0 0 0 0 0 1 1 

1 Negative numbers represent decreases in the deficit; positive numbers indicate increases in the deficit. 2 Agency contributions are intragovernmental transactions that do not affect the deficit. 

Notes: Components may not sum to totals because of rounding. 

Off-budget effects reflect changes in revenues and spending in Social Security. * = between ¥$500,000 and $500,000. 


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Basis of estimate: Based on information from the Department of 

Homeland Security, CBO estimates that 180 employees of the Secret Service would be eligible to transfer to the DC system under 

S. 1862, and that 90 percent of them would choose to transfer. For 

this estimate CBO assumes that S. 1862 will be enacted early in 

calendar year 2010. 

Direct spending 

Because the DC system provides a higher basic pension than 

FERS, the current retirement plan for those Secret Service employees, CBO estimates that enacting the bill would result in additional 

spending of about $18 million for benefit payments to employees 

who transfer over the 2010–2019 period. (The DC system is run by 

the Washington, DC, government, but receives a payment from the 

federal government to cover certain employees.) That additional 

spending would be partially offset by $4 million in contributions 

that transitioning employees would make to the DC system. In addition, the bill stipulates that employees who elect to change to the 

DC system would forfeit any Social Security benefits that would be 

based on their earnings as employees of the Secret Service. That 

provision would reduce direct spending on Social Security benefits 

by $2 million (off-budget) over the 10-year period. CBO estimates 

that, in total, those changes would lead to a net increase in direct 

spending of $12 million over the 2010–2019 period. 

Revenues 

CBO estimates that enacting S. 1862 would reduce revenues over the 2010–2019 period by $2 million because individuals who elect 

to transfer to the DC system under the bill would no longer contribute to Social Security or FERS. Those contributions are recorded on the budget as revenues. The reduction in Social Security 

revenues ($1 million) would be off-budget. 

Spending subject to appropriation 

Under S. 1862 the Secret Service would no longer make contributions to FERS, TSP, or Social Security for employees who move to 

the DC system. CBO estimates that spending subject to appropriation for the Secret Service thus would decline by $13 million over 

the 2010–2019 period. Such reductions in discretionary spending 

assume appropriations would be reduced by the estimated 

amounts. Contributions to FERS and Social Security are 

intragovernmental transactions that are recorded as offsetting receipts elsewhere in the budget. CBO estimates that those forgone 

contributions would total about $11 million over the 2010–2019 period. 

Intergovernmental and private-sector impact: S. 1510 contains no 

intergovernmental or private-sector mandates as defined in UMRA 

and would not affect the budgets of state, local, or tribal governments. 

Estimate prepared by: Federal costs: Retirement—Santiago 

Vallinas and Jared Brewster Social Security—Sheila Dacey; Impact 

on state, local, and tribal governments: Elizabeth Cove Delisle; Impact on the private sector: Brian Prest. 

Estimate approved by: Theresa Gullo, Deputy Assistant Director 

for Budget Analysis. 


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VIII. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

Because this legislation would not repeal or amend any provision 

of current law, it would make no changes in existing law within the 

meaning of clauses (a) and (b) of paragraph 12 of rule XXVI of the 

Standing Rules of the Senate. 

Æ 


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