II

104TH CONGRESS

1ST SESSION S. 819

To amend chapters 83 and 84 of title 5, United States Code, to provide

for more uniform treatment of Members of Congress, congressional employees, and Federal employees, to reform the Federal retirement systems, and for other purposes.

IN THE SENATE OF THE UNITED STATES

MAY 18 (legislative day, MAY 15), 1995

Mr. KERREY (for himself and Mr. SIMPSON) introduced the following bill;

which was read twice and referred to the Committee on Governmental Affairs

A BILL

To amend chapters 83 and 84 of title 5, United States

Code, to provide for more uniform treatment of Members

of Congress, congressional employees, and Federal employees, to reform the Federal retirement systems, and

for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Federal Retirement

5 Reform Act of 1995’’.
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1 SEC. 2. FEDERAL RETIREMENT PROVISIONS RELATING TO

2 MEMBERS OF CONGRESS AND CONGRES3 SIONAL EMPLOYEES.

4 (a) ACCRUAL RATES RELATING TO MEMBERS OF

5 CONGRESS AND CONGRESSIONAL EMPLOYEES UNDER

6 THE FEDERAL EMPLOYEES RETIREMENT SYSTEM.—Sec7 tion 8415 of title 5, United States Code, is amended—

8 (1) by striking out subsections (b) and (c);

9 (2) in subsections (a) and (g) by inserting ‘‘or

10 Member’’ after ‘‘employee’’ each place it appears;

11 and

12 (3) in subsection (g)(2) by striking out ‘‘Con13 gressional employee’’.

14 (b) CONTRIBUTION RATES RELATING TO MEMBERS

15 OF CONGRESS AND CONGRESSIONAL EMPLOYEES UNDER

16 THE FEDERAL EMPLOYEES RETIREMENT SYSTEM.—Sec17 tion 8422(a)(2) of title 5, United States Code, is

18 amended—

19 (1) in subparagraph (A) by striking out ‘‘em20 ployee (other than a law enforcement officer, fire21 fighter, air traffic controller, or Congressional em22 ployee)’’ and inserting in lieu thereof ‘‘employee or

23 Member (other than a law enforcement officer, fire24 fighter, or air traffic controller)’’; and

25 (2) in subparagraph (B)—

26 (A) by striking out ‘‘a Member,’’; and
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1 (B) by striking out ‘‘air traffic controller,

2 or Congressional employee,’’ and inserting in

3 lieu thereof ‘‘or air traffic controller,’’.

4 (c) ADMINISTRATIVE REGULATIONS.—The Secretary

5 of the Senate and the Clerk of the House of Representa6 tives, in consultation with the Office of Personnel Manage7 ment, may prescribe regulations to carry out the provi8 sions of this section and the amendments made by this

9 section for applicable employees and Members of Con10 gress.

11 (d) EFFECTIVE DATES.—

12 (1) IN GENERAL.—Except as otherwise pro13 vided in this subsection, the provisions of this sec14 tion shall take effect on the date of the enactment

15 of this Act.

16 (2) ACCRUAL RATE; ANNUITY COMPUTATION.—

17 (A) GENERAL RULE.—The amendments

18 made by subsection (a) shall take effect on the

19 date of the enactment of this Act and shall

20 apply only with respect to the computation of

21 an annuity relating to—

22 (i) the service of a Member of Con23 gress as a Member or as a Congressional

24 employee performed on or after January 1,

25 1997; and
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1 (ii) the service of a Congressional em2 ployee as a Congressional employee per3 formed on or after January 1, 1997.

4 (B) EXCEPTION.—An annuity shall be

5 computed as though the amendments made

6 under subsection (a) had not been enacted with

7 respect to—

8 (i) the service of a Member of Con9 gress as a Member or a Congressional em10 ployee or military service performed before

11 January 1, 1997; and

12 (ii) the service of a Congressional em13 ployee as a Congressional employee or mili14 tary service performed before January 1,

15 1997.

16 (3) CONTRIBUTION RATES.—The amendments

17 made by subsection (b) shall take effect on the first

18 day of the first applicable pay period beginning on

19 or after January 1, 1997.

20 SEC. 3. INCREASE IN YEARS USED TO DETERMINE AVER21 AGE PAY.

22 (a) DEFINITION OF AVERAGE PAY.—

23 (1) CIVIL SERVICE RETIREMENT SYSTEM.—Sec24 tion 8331(4) of title 5, United States Code, is

25 amended to read as follows:
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1 ‘‘(4) ‘average pay’ means—

2 ‘‘(A) with respect to service performed be3 fore the effective date of section 3 of the Fed4 eral Retirement Reform Act of 1995, the larg5 est annual rate resulting from averaging an em6 ployee’s or Member’s rates of basic pay in effect

7 over any 3 consecutive years of creditable serv8 ice or, in the case of an annuity under sub9 section (d) or (e)(1) of section 8341 of this title

10 based on service of less than 3 years, over the

11 total service, with each rate weighted by the

12 time it was in effect; and

13 ‘‘(B) with respect to service performed on

14 and after the effective date of section 3 of the

15 Federal Retirement Reform Act of 1995, the

16 largest annual rate resulting from averaging an

17 employee’s or Member’s rates of basic pay in ef18 fect over any 5 consecutive years of creditable

19 service, or, in the case of an annuity under sub20 section (d) or (e)(1) of section 8341 of this title

21 based on service of less than 5 years, over the

22 total service, with each rate weighted by the

23 time it was in effect.’’.
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1 (2) FEDERAL EMPLOYEE RETIREMENT SYS2 TEM.—Section 8401(3) of title 5, United States

3 Code, is amended to read as follows:

4 ‘‘(3) the term ‘average pay’ means—

5 ‘‘(A) with respect to service performed be6 fore the effective date of section 3 of the Fed7 eral Retirement Reform Act of 1995, the larg8 est annual rate resulting from averaging an em9 ployee’s or Member’s rates of basic pay in effect

10 over any 3 consecutive years of service or, in

11 the case of an annuity under this chapter based

12 on service of less than 3 years, over the total

13 service, with each rate weighted by the period

14 it was in effect; and

15 ‘‘(B) with respect to service performed on

16 and after the effective date of section 3 of the

17 Federal Retirement Reform Act of 1995, the

18 largest annual rate resulting from averaging an

19 employee’s or Member’s rates of basic pay in ef20 fect over any 5 consecutive years of service, or,

21 in the case of an annuity under this chapter

22 based on service of less than 5 years, over the

23 total service, with each rate weighted by the pe24 riod it was in effect.’’.

25 (b) APPLICATION CLARIFICATION.—
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1 (1) CIVIL SERVICE RETIREMENT SYSTEM.—In

2 computing an annuity under any provision of chap3 ter 83 of title 5, United States Code, the product re4 sulting from using average pay determined under

5 section 8331(4)(A) of such title in accordance with

6 such applicable provision of such chapter, shall be

7 added to the product resulting from using average

8 pay determined under section 8331(4)(B) of such

9 title.

10 (2) FEDERAL EMPLOYEE RETIREMENT SYS11 TEM.—In computing an annuity under any provision

12 of chapter 84 of title 5, United States Code, the

13 product resulting from using average pay determined

14 under section 8401(3)(A) of such title in accordance

15 with such applicable provision of such chapter, shall

16 be added to the product resulting from using aver17 age pay determined under section 8401(3)(B) of

18 such title.

19 (c) REGULATIONS.—The Office of Personnel Man20 agement shall prescribe regulations to carry out the provi21 sions of this section.

22 (d) EFFECTIVE DATE.—This section shall take effect

23 on January 1, 1996.
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1 SEC. 4. REDUCTION IN ACCRUAL RATES.

2 (a) CIVIL SERVICE RETIREMENT SYSTEM.—Section

3 8339 of title 5, United States Code, is amended to read

4 as follows:

5 ‘‘§ 8339. Computation of annuity

6 ‘‘(a)(1) Except as otherwise provided by this section,

7 the annuity of an employee retiring under this subchapter

8 is—

9 ‘‘(A) with respect to service performed before

10 January 1, 1996—

‘‘(i) 11 11 ⁄2 percent of his average pay multi12 plied by so much of his total service as does not

13 exceed 5 years; plus

‘‘(ii) 13 14 ⁄4 percent of his average pay multi15 plied by so much of his total service as exceeds

16 5 years but does not exceed 10 years; plus

17 ‘‘(iii) 2 percent of his average pay multi18 plied by so much of his total service as exceeds

19 10 years; plus

20 ‘‘(B) with respect to service performed on or

21 after January 1, 1996—

22 ‘‘(i) 1.4 percent of his average pay multi23 plied by so much of his total service as does not

24 exceed 5 years; plus
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1 ‘‘(ii) 1.65 percent of his average pay multi2 plied by so much of his total service as exceeds

3 5 years but does not exceed 10 years; plus

4 ‘‘(iii) 1.9 percent of his average pay multi5 plied by so much of his total service as exceeds

6 10 years.

7 ‘‘(2) Notwithstanding paragraph (1), when it results

8 in a larger annuity—

9 ‘‘(A) 1 percent of the average pay of an em10 ployee plus $25 is substituted for the percentage

11 specified under paragraph (1)(A) (i), (ii), or (iii), or

12 any combination thereof; and

13 ‘‘(B) .9 percent of the average pay of the em14 ployee plus $25 is substituted for the percentage

15 specified under paragraph (1)(B) (i), (ii), or (iii), or

16 any combination thereof.’’.

17 (b) FEDERAL EMPLOYEES RETIREMENT SYSTEM.—

18 Section 8415 of title 5, United States Code (as amended

19 by section 2(a) of this Act) is further amended—

20 (1) in subsection (a) by striking out ‘‘1 percent

21 of that individual’s average pay multiplied by such

22 individual’s total service.’’ and inserting in lieu

23 thereof a dash and the following:
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1 ‘‘(1) 1 percent of that individual’s average pay

2 multiplied by such individual’s service performed be3 fore January 1, 1996; plus

4 ‘‘(2) .9 percent of that individual’s average pay

5 multiplied by such individual’s service performed on

6 or after January 1, 1996.’’; and

7 (2) in subsection (g)(1) by inserting before the

8 period ‘‘or .9 percent, as applicable’’.

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