United States 

Office of 

Personnel Management 

The Federal Government’s Human Resources Agency

Benefits Administration Letter

 

Number: 11-305 Date: August, 2011

Subject: Fiscal Year 2011 Factors for Calculating Imputed Costs 

This Letter provides the fiscal year (FY) 2011 cost factors for the Federal civilian benefit 

programs. Agencies will use these factors to calculate their imputed costs relating to the Civil 

Service Retirement System (CSRS), the Federal Employees Retirement System (FERS), 

the Federal Employees Health Benefits Program (FEHB) and the Federal Employees’ Group 

Life Insurance Program (FEGLI) which are used to determine the actuarial liabilities which are 

included in Governmental financial statements. By way of review, FY 2010 marked the 

implementation of Statement of Federal Financial Accounting Standards 33: Pensions, Other 

Retirement Benefits, and Other Postemployment Benefits: Reporting the Gains and Losses 

from Changes in Assumptions and Selecting Discount Rates and Valuation Dates (SFFAS 33),

which resulted in significant changes to the actuarial assumptions for the benefit programs. 

Benefits Administration Letter 03-309, dated September 15, 2003, provides detailed 

instructions for the computation and accounting for these imputed costs; see 

http://www.opm.gov/retire/pubs/bals/2003/03-309.pdf. 

COST FACTORS 

Pensions. SFFAS 33 required a change to the long term economic assumptions used in the reporting 

of actuarial liabilities for CSRS and FERS beginning in FY 2010. OPM’s retirement actuary has 

determined that the retirement cost factors for FY 2011 are the same as for FY 2010 since the 

actuarial assumptions have not changed. Agencies should apply these retirement cost factors with 

the year-end financial reporting. 

These cost factors, determined under SFFAS 33, differ from the normal cost percentages used to 

determine the employer contributions agencies pay for FERS employees. We note that there will be 

an increase in employer contributions that agencies pay for FERS employees beginning in FY 2012 –

please see BAL 11-304 for details. However, agencies should expect to continue to report future 

imputed retirement costs for their FERS employees, as the cost factors reported under SFFAS 33 

are determined on a different basis than are the actual FERS normal cost contributions. 

For most CSRS-covered employees, the FY 2011 cost factor is 30.1 percent of basic pay. The 

FY 2011 cost factors for all categories of CSRS coverage are attached. While agency payments 

under CSRS are not affected by the CSRS normal cost percentages for the vast majority of 
agencies, the CSRS normal cost percentages determined under SFFAS 33 are used to determine 

the actuarial liabilities which are included in Governmental financial statements. 

For most FERS-covered employees, the FY 2011 cost factor is 13.8 percent of basic pay. Due to the 

change in actuarial assumptions required with the FY 2010 implementation of SFFAS 33, agencies 

will need to calculate an imputed cost for FERS. The cost factors for all categories of FERS 

coverage are attached. 

FEHB Program. For FY 2011 the cost factor is $6,027 per enrolled employee. Please note that 

the cost factors shown below are based on the actuarial assumptions required by SFFAS 33, as 

calculated by the FEHB actuary. 

. 

Quarter Factor

1

st $1,466

2

nd 1,493

3

rd 1,520

4

th 1,548

FY 2011 $6,027

FEGLI Program. The FY 2011 cost factor for the FEGLI is 0.02 percent of basic pay, the same 

as in previous years. 

STATEMENT FOR AUDITORS 

The cost factors provided in this letter are being issued before an opinion by OPM’s independent 

public accounting firm can be received for FY 2011. Nonetheless, the FY 2010 cost factors for 

“regular” CSRS and FERS coverage, as well as those for the FEHB and FEGLI Programs were 

disclosed in the footnotes accompanying OPM’s consolidated FY 2010 financial statements; these 

statements received an unqualified audit opinion. The policies, procedures and controls pertaining 

to the calculations of the cost factors did not change from FY 2010. In addition, the Retirement 

and Life Insurance Program cost factors were unchanged from FY 2010. Consequently, auditors 

of FY 2011 financial statements can rely upon the disclosures in OPM’s FY 2010 financial 

statements and the related audit opinion. 

INQUIRIES 

If you have any questions regarding this information, feel free to email us at finance@opm.gov. 

You may also phone us at (202) 606-0606. 

 Emily Dean

 Associate Chief Financial Officer 

Attachment Financial Services 
 Attachment 

2011 COST FACTORS FOR THE CSRS AND FERS 

CSRS

CATEGORY COST FACTOR (%)

Regular 30.1

Regular Offset 23.5

Law Enforcement Officers 51.1

Law Enforcement Officers - Offset 45.6

Air Traffic Controllers 46.6

Air Traffic Controllers – Offset 41.4

Members of Congress 33.4

Members of Congress – Offset 31.2

Congressional Employees 41.3

Congressional Employees – Offset 35.9

FERS

CATEGORY COST FACTOR (%)

Regular 13.8

Law Enforcement Officers 29.8

Air Traffic Controllers 29.6

Members of Congress 20.9

Congressional Employees 19.6

Military Reserve Technicians 17.0