Union Calendar No. 455

104TH CONGRESS

2D SESSION H. R. 3841

[Report No. 104–831]

A BILL

To amend the civil service laws of the United

States, and for other purposes.

SEPTEMBER 24, 1996

Reported with an amendment, committed to the Commitordered to be printed tee of the Whole House on the State of the Union, and
IB

Union Calendar No. 455

104TH CONGRESS

2D SESSION H. R. 3841

[Report No. 104–831]

To amend the civil service laws of the United States, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

JULY 17, 1996

Mr. MICA (for himself, Mr. MORAN, and Mrs. MORELLA) introduced the following bill; which was referred to the Committee on Government Reform

and Oversight

SEPTEMBER 24, 1996

Additional sponsor: Mr. DAVIS

SEPTEMBER 24, 1996

Reported with an amendment, committed to the Committee of the Whole

House on the State of the Union, and ordered to be printed

[Strike out all after the enacting clause and insert the part printed in italic]

[For text of introduced bill, see copy of bill as introduced on July 17, 1996]

A BILL

To amend the civil service laws of the United States, 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,
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1 SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

2 (a) SHORT TITLE.—This Act may be cited as the ‘‘Om3 nibus Civil Service Reform Act of 1996’’.

4 (b) TABLE OF CONTENTS.—The table of contents for

5 this Act is as follows:

Sec. 1. Short title; table of contents.

TITLE I—DEMONSTRATION PROJECTS

Sec. 101. Demonstration projects.

TITLE II—PERFORMANCE MANAGEMENT ENHANCEMENT

Sec. 201. Increased weight given to performance for order-of-retention purposes in

a reduction in force.

Sec. 202. No appeal of denial of periodic step-increases.

Sec. 203. Performance appraisals.

Sec. 204. Amendments to incentive awards authority.

Sec. 205. Due process rights of managers under negotiated grievance procedures.

Sec. 206. Collection and reporting of training information.

TITLE III—ENHANCEMENT OF THRIFT SAVINGS PLAN AND

CERTAIN OTHER BENEFITS

Subtitle A—Additional Investment Funds for the Thrift Savings Plan

Sec. 301. Short title.

Sec. 302. Additional investment funds for the Thrift Savings Plan.

Sec. 303. Acknowledgement of investment risk.

Sec. 304. Effective date.

Subtitle B—Thrift Savings Account Liquidity

Sec. 311. Short title.

Sec. 312. Notice to spouses for in-service withdrawals; de minimus accounts; Civil

Service Retirement System participants.

Sec. 313. In-service withdrawals; withdrawal elections, Federal Employees’ Retirement System participants.

Sec. 314. Survivor annuities for former spouses; notice to Federal Employees’ Retirement System spouses for in-service withdrawals.

Sec. 315. De minimus accounts relating to the judiciary.

Sec. 316. Definition of basic pay.

Sec. 317. Eligible rollover distributions.

Sec. 318. Effective date.

Subtitle C—Other Provisions Relating to the Thrift Savings Plan

Sec. 321. Percentage limitations on contributions.

Sec. 322. Loans under the Thrift Savings Plan for furloughed employees.

Sec. 323. Immediate participation in the Thrift Savings Plan.
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Subtitle D—Resumption of Certain Survivor Annuities That Terminated by

Reason of Marriage

Sec. 331. Resumption of certain survivor annuities that terminated by reason of

marriage.

Subtitle E—Life Insurance Benefits

Sec. 341. Domestic relations orders.

Sec. 342. Exception from provisions requiring reduction in additional optional

life insurance.

TITLE IV—REORGANIZATION FLEXIBILITY

Sec. 401. Voluntary reductions in force.

Sec. 402. Nonreimbursable details to Federal agencies before a reduction in force.

TITLE V—SOFT-LANDING PROVISIONS

Sec. 501. Temporary continuation of Federal employees’ life insurance.

Sec. 502. Continued eligibility for health insurance.

Sec. 503. Priority placement programs for Federal employees affected by a reduction in force.

Sec. 504. Job placement and counseling services.

Sec. 505. Education and retraining incentives.

TITLE VI—MISCELLANEOUS

Sec. 601. Reimbursements relating to professional liability insurance.

Sec. 602. Employment rights following conversion to contract.

Sec. 603. Debarment of health care providers found to have engaged in fraudulent

practices.

Sec. 604. Conversion of certain excepted service positions in the United States

Fire Administration to competitive service positions.

Sec. 605. Eligibility for certain survivor annuity benefits.

Sec. 606. Amendment to Public Law 104–134.

Sec. 607. Miscellaneous amendments relating to the health benefits program for

Federal employees.

Sec. 608. Pay for certain positions formerly classified at GS–18.

Sec. 609. Repeal of section 1307 of title 5 of the United States Code.

Sec. 610. Mandatory internal alternative dispute resolution procedures.

1 TITLE I—DEMONSTRATION

2 PROJECTS

3 SEC. 101. DEMONSTRATION PROJECTS.

4 (a) DEFINITIONS.—Paragraph (1) of section 4701(a)

5 of title 5, United States Code, is amended by striking sub6 paragraph (A) and by redesignating subparagraphs (B)

7 and (C) as subparagraphs (A) and (B), respectively.
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1 (b) PRE-IMPLEMENTATION PROCEDURES.—Subsection

2 (b) of section 4703 of title 5, United States Code, is amend3 ed to read as follows:

4 ‘‘(b) Before an agency or the Office may conduct or

5 enter into any agreement or contract to conduct a dem6 onstration project, the Office—

7 ‘‘(1) shall develop or approve a plan for such

8 project which identifies—

9 ‘‘(A) the purposes of the project;

10 ‘‘(B) the methodology;

11 ‘‘(C) the duration; and

12 ‘‘(D) the methodology and criteria for eval13 uation;

14 ‘‘(2) shall publish the plan in the Federal Reg15 ister;

16 ‘‘(3) may solicit comments from the public and

17 interested parties in such manner as the Office con18 siders appropriate;

19 ‘‘(4) shall obtain approval from each agency in20 volved of the final version of the plan; and

21 ‘‘(5) shall provide notification of the proposed

22 project, at least 30 days in advance of the date any

23 project proposed under this section is to take effect—

24 ‘‘(A) to employees who are likely to be af25 fected by the project; and
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1 ‘‘(B) to each House of the Congress.’’.

2 (c) NONWAIVABLE PROVISIONS.—Section 4703(c) of

3 title 5, United States Code, is amended—

4 (1) by striking paragraph (1) and inserting the

5 following:

6 ‘‘(1) any provision of subchapter V of chapter 63

7 or subpart G of part III of this title;’’; and

8 (2) by striking paragraph (3) and inserting the

9 following:

10 ‘‘(3) any provision of chapter 15 or subchapter

11 II or III of chapter 73 of this title;’’.

12 (d) LIMITATIONS.—Subsection (d) of section 4703 of

13 title 5, United States Code, is amended to read as follows:

14 ‘‘(d)(1) Each demonstration project shall terminate be15 fore the end of the 5-year period beginning on the date on

16 which the project takes effect, except that the project may

17 continue for a maximum of 2 years beyond the date to the

18 extent necessary to validate the results of the project.

19 ‘‘(2)(A) Not more than 15 active demonstration

20 projects may be in effect at any time, and of the projects

21 in effect at any time, not more than 5 may involve 5,000

22 or more individuals each.

23 ‘‘(B) Individuals in a control group necessary to vali24 date the results of a project shall not, for purposes of any
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1 determination under subparagraph (A), be considered to be

2 involved in such project.’’.

3 (e) EVALUATIONS.—Subsection (h) of section 4703 of

4 title 5, United States Code, is amended by adding at the

5 end the following: ‘‘The Office may, with respect to a dem6 onstration project conducted by another agency, require

7 that the preceding sentence be carried out by such other

8 agency.’’.

9 (f) PROVISIONS FOR TERMINATION OF PROJECT OR

10 MAKING IT PERMANENT.—Section 4703 of title 5, United

11 States Code, is amended—

12 (1) in subsection (i) by inserting ‘‘by the Office’’

13 after ‘‘undertaken’’; and

14 (2) by adding at the end the following:

15 ‘‘(j)(1) If the Office determines that termination of a

16 demonstration project (whether under subsection (e) or oth17 erwise) would result in the inequitable treatment of employ18 ees who participated in the project, the Office shall take

19 such corrective action as is within its authority. If the Of20 fice determines that legislation is necessary to correct an

21 inequity, it shall submit an appropriate legislative proposal

22 to both Houses of Congress.

23 ‘‘(2) If the Office determines that a demonstration

24 project should be made permanent, it shall submit an ap25 propriate legislative proposal to both Houses of Congress.’’.
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1 TITLE II—PERFORMANCE

2 MANAGEMENT ENHANCEMENT

3 SEC. 201. INCREASED WEIGHT GIVEN TO PERFORMANCE

4 FOR ORDER-OF-RETENTION PURPOSES IN A

5 REDUCTION IN FORCE.

6 (a) IN GENERAL.—Section 3502 of title 5, United

7 States Code, is amended—

8 (1) in subsection (a)(4) by striking ‘‘ratings.’’

9 and inserting ‘‘ratings, in conformance with the re10 quirements of subsection (g).’’; and

11 (2) by adding at the end the following:

12 ‘‘(g)(1) The regulations prescribed to carry out sub13 section (a)(4) shall be the regulations in effect, as of Janu14 ary 1, 1996, under section 351.504 of title 5 of the Code

15 of Federal Regulations, except as otherwise provided in this

16 subsection.

17 ‘‘(2) For purposes of this subsection—

18 ‘‘(A) subsections (b)(4) and (e) of such section

19 351.504 shall be disregarded;

20 ‘‘(B) subsection (d) of such section 351.504 shall

21 be considered to read as follows:

22 ‘‘ ‘(d)(1) The additional service credit an employee re23 ceives for performance under this subpart shall be expressed

24 in additional years of service and shall consist of the sum

25 of the employee’s 3 most recent (actual and/or assumed) an-
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1 nual performance ratings received during the 4-year period

2 prior to the date of issuance of reduction-in-force notices

3 or the 4-year period prior to the agency-established cutoff

4 date (as appropriate), computed in accordance with para5 graph (2) or (3) (as appropriate).

6 ‘‘ ‘(2) Except as provided in paragraph (3), an em7 ployee shall receive—

8 ‘‘ ‘(A) 5 additional years of service for each per9 formance rating of fully successful (Level 3) or equiv10 alent;

11 ‘‘ ‘(B) 7 additional years of service for each per12 formance rating of exceeds fully successful (Level 4) or

13 equivalent; and

14 ‘‘ ‘(C) 10 additional years of service for each per15 formance rating of outstanding (Level 5) or equiva16 lent.

17 ‘‘ ‘(3)(A) If the employing agency uses a rating system

18 having only 1 rating to denote performance which is fully

19 successful or better, then an employee under such system

20 shall receive 5 additional years of service for each such rat21 ing.

22 ‘‘ ‘(B) If the employing agency uses a rating system

23 having only 2 ratings to denote performance which is fully

24 successful or better, then an employee under such system

25 shall receive—
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1 ‘‘ ‘(i) 5 additional years of service for each per2 formance rating at the lower of those 2 ratings; and

3 ‘‘ ‘(ii) 7 additional years of service for each per4 formance rating at the higher of those 2 ratings.

5 ‘‘ ‘(C) If the employing agency uses a rating system

6 having more than 3 ratings to denote performance which

7 is fully successful or better, then an employee under such

8 system shall receive—

9 ‘‘ ‘(i) 5 additional years of service for each per10 formance rating at the lowest of those ratings;

11 ‘‘ ‘(ii) 7 additional years of service for each per12 formance rating at the next rating above the rating

13 referred to in clause (i); and

14 ‘‘ ‘(iii) 10 additional years of service for each

15 performance rating above the rating referred to in

16 clause (ii).

17 ‘‘ ‘(D) For purposes of this paragraph, a rating shall

18 not be considered to denote performance which is fully suc19 cessful or better unless, in order to receive such rating, such

20 performance must satisfy all requirements for a fully suc21 cessful rating (Level 3) or equivalent, as established under

22 part 430 of this chapter (as in effect as of January 1,

23 1996).’; and

24 ‘‘(C) subsection (c) of such section shall be con25 sidered to read as follows:
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1 ‘‘ ‘(c)(1) Service credit for employees who do not have

2 3 actual annual performance ratings of record received dur3 ing the 4-year period prior to the date of issuance of reduc4 tion-in-force notices, or the 4-year period prior to the agen5 cy-established cutoff date for ratings permitted in subsection

6 (b)(2) of this section, shall be determined in accordance

7 with paragraph (2).

8 ‘‘ ‘(2) An employee who has not received 1 or more of

9 the 3 annual performance ratings of record required under

10 this section shall—

11 ‘‘ ‘(A) receive credit for performance on the basis

12 of the rating or ratings actually received (if any);

13 and

14 ‘‘ ‘(B) for each performance rating not actually

15 received, be given credit for 5 additional years of serv16 ice.’.’’.

17 (b) EQUITABLE TREATMENT OF EMPLOYEES.—For

18 purposes of determining the order of retention of employees

19 in a reduction in force taking effect on or after October 1,

20 1999, the Office of Personnel Management shall prescribe

21 such regulations as may be necessary to ensure that—

22 (1) in the case of any agency having more than

23 1 performance evaluation system, employees subject to

24 different systems are treated equitably; and
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1 (2) with respect to employees in the same com2 petitive area who have been subject to different per3 formance evaluation systems with dissimilar sum4 mary levels, no such employee shall suffer as a result

5 of having been covered by more than 1 such system.

6 (c) REPORT.—Not later than 270 days after the date

7 of the enactment of this Act, the General Accounting Office

8 shall submit to the Committee on Government Reform and

9 Oversight of the House of Representatives and the Commit10 tee on Governmental Affairs of the Senate a report analyz11 ing and assessing the following:

12 (1) Based on performance-ratings statistics in

13 the executive branch of the Government over the past

14 15 years, the correlation (if any) between employees’

15 ratings of record and the following:

16 (A) Promotions.

17 (B) Awards.

18 (C) Bonuses.

19 (D) Quit rates.

20 (E) Removals.

21 (F) Disciplinary actions (other than remov22 als).

23 (G) The filing of grievances, complaints,

24 and charges of unfair labor practices.

25 (H) Appeals of adverse actions.
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1 (2) The impact of performance ratings on reten2 tion during reductions in force over the past 5 years.

3 (3) Whether ‘‘pass/fail’’ performance systems are

4 compatible with the statutory requirement that effi5 ciency or performance ratings be given due effect dur6 ing reductions in force.

7 (4) The respective numbers of Federal agencies,

8 organizational units, and Federal employees that are

9 covered by the different performance evaluation sys10 tems.

11 (5) The potential impact of this section on em12 ployees in different performance evaluation systems.

13 (6) Whether there are significant differences in

14 the distribution of ratings among or within agencies

15 and, if so, the reasons therefor.

16 Based on the findings of the General Accounting Office, the

17 report shall include recommendations to improve the effec18 tiveness of Federal performance evaluation systems.

19 (d) EFFECTIVE DATE.—The amendments made by this

20 section shall apply with respect to reductions in force taking

21 effect on or after October 1, 1999.

22 SEC. 202. NO APPEAL OF DENIAL OF PERIODIC STEP-IN23 CREASES.

24 (a) IN GENERAL.—Section 5335(c) of title 5, United

25 States Code, is amended—
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1 (1) by striking the second sentence;

2 (2) in the third sentence by striking ‘‘or appeal’’;

3 and

4 (3) in the last sentence by striking ‘‘and the enti5 tlement of the employee to appeal to the Board do not

6 apply’’ and inserting ‘‘does not apply’’.

7 (b) PERFORMANCE RATINGS.—Section 5335 of title 5,

8 United States Code, as amended by subsection (a), is further

9 amended—

10 (1) in subsection (a)(B) by striking ‘‘work of the

11 employee is of an acceptable level of competence’’ and

12 inserting ‘‘performance of the employee is at least

13 fully successful’’;

14 (2) in subsection (c)—

15 (A) in the first sentence by striking ‘‘work

16 of an employee is not of an acceptable level of

17 competence,’’ and inserting ‘‘performance of an

18 employee is not at least fully successful,’’; and

19 (B) in the last sentence by striking ‘‘accept20 able level of competence’’ and inserting ‘‘fully

21 successful work performance’’; and

22 (3) by adding at the end the following:

23 ‘‘(g) For purposes of this section, the term ‘fully suc24 cessful’ denotes work performance that satisfies the require25 ments of section 351.504(d)(3)(D) of title 5 of the Code of
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1 Federal Regulations (as deemed to be amended by section

2 3502(g)(2)(B)).’’.

3 SEC. 203. PERFORMANCE APPRAISALS.

4 (a) IN GENERAL.—Section 4302 of title 5, United

5 States Code, is amended—

6 (1) in subsection (b) by striking paragraphs (5)

7 and (6) and inserting the following:

8 ‘‘(5) assisting employees in improving unaccept9 able performance, except in circumstances described

10 in subsection (c); and

11 ‘‘(6) reassigning, reducing in grade, removing, or

12 taking other appropriate action against employees

13 whose performance is unacceptable.’’; and

14 (2) by adding at the end the following:

15 ‘‘(c) Upon notification of unacceptable performance,

16 an employee shall be afforded an opportunity to dem17 onstrate acceptable performance before a reduction in grade

18 or removal may be proposed under section 4303 based on

19 such performance, except that an employee so afforded such

20 an opportunity shall not be afforded any further oppor21 tunity to demonstrate acceptable performance if the employ22 ee’s performance again is determined to be at an unaccept23 able level.’’.

24 (b) EFFECTIVE DATE.—
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1 (1) IN GENERAL.—Subject to paragraph (2), this

2 section and the amendments made by this section

3 shall take effect 180 days after the date of the enact4 ment of this Act.

5 (2) EXCEPTION.—The amendments made by this

6 section shall not apply in the case of any proposed

7 action as to which the employee receives advance

8 written notice, in accordance with section

9 4303(b)(1)(A) of title 5, United States Code, before the

10 effective date of this section.

11 SEC. 204. AMENDMENTS TO INCENTIVE AWARDS AUTHOR12 ITY.

13 Chapter 45 of title 5, United States Code, is amend14 ed—

15 (1) by amending section 4501 to read as follows:

16 ‘‘§ 4501. Definitions

17 ‘‘For the purpose of this subchapter—

18 ‘‘(1) the term ‘agency’ means—

19 ‘‘(A) an Executive agency;

20 ‘‘(B) the Library of Congress;

21 ‘‘(C) the Office of the Architect of the Cap22 itol;

23 ‘‘(D) the Botanic Garden;

24 ‘‘(E) the Government Printing Office; and
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1 ‘‘(F) the United States Sentencing Commis2 sion;

3 but does not include—

4 ‘‘(i) the Tennessee Valley Authority; or

5 ‘‘(ii) the Central Bank for Cooperatives;

6 ‘‘(2) the term ‘employee’ means an employee as

7 defined by section 2105; and

8 ‘‘(3) the term ‘Government’ means the Govern9 ment of the United States.’’;

10 (2) by amending section 4503 to read as follows:

11 ‘‘§ 4503. Agency awards

12 ‘‘(a) The head of an agency may pay a cash award

13 to, and incur necessary expense for the honorary recognition

14 of, an employee who—

15 ‘‘(1) by his suggestion, invention, superior ac16 complishment, or other personal effort, contributes to

17 the efficiency, economy, or other improvement of Gov18 ernment operations or achieves a significant reduc19 tion in paperwork; or

20 ‘‘(2) performs a special act or service in the pub21 lic interest in connection with or related to his offi22 cial employment.

23 ‘‘(b)(1) If the criteria under paragraph (1) or (2) of

24 subsection (a) are met on the basis of the suggestion, inven25 tion, superior accomplishment, act, service, or other meri-
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1 torious effort of a group of employees collectively, and if

2 the circumstances so warrant (such as by reason of the in3 feasibility of determining the relative role or contribution

4 assignable to each employee separately), authority under

5 subsection (a) may be exercised—

6 ‘‘(A) based on the collective efforts of the group;

7 and

8 ‘‘(B) with respect to each member of such group.

9 ‘‘(2) The amount awarded to each member of a group

10 under this subsection—

11 ‘‘(A) shall be the same for all members of such

12 group, except that such amount may be prorated to

13 reflect differences in the period of time during which

14 an individual was a member of the group; and

15 ‘‘(B) may not exceed the maximum cash award

16 allowable under subsection (a) or (b) of section 4502,

17 as applicable.’’; and

18 (3) in subsection (a)(1) of section 4505a by strik19 ing ‘‘at the fully successful level or higher’’ and insert20 ing ‘‘higher than the fully successful level’’.

21 SEC. 205. DUE PROCESS RIGHTS OF MANAGERS UNDER NE22 GOTIATED GRIEVANCE PROCEDURES.

23 (a) IN GENERAL.—Paragraph (2) of section 7121(b)

24 of title 5, United States Code, is amended to read as follows:
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1 ‘‘(2) The provisions of a negotiated grievance proce2 dure providing for binding arbitration in accordance with

3 paragraph (1)(C)(iii) shall, if or to the extent that an al4 leged prohibited personnel practice is involved, allow the ar5 bitrator to order a stay of any personnel action in a man6 ner similar to the manner described in section 1221(c) with

7 respect to the Merit Systems Protection Board.’’.

8 (b) EFFECTIVE DATE.—The amendment made by sub9 section (a)—

10 (1) shall take effect on the date of the enactment

11 of this Act; and

12 (2) shall apply with respect to orders issued on

13 or after the date of the enactment of this Act, notwith14 standing the provisions of any collective bargaining

15 agreement.

16 SEC. 206. COLLECTION AND REPORTING OF TRAINING IN17 FORMATION.

18 (a) TRAINING WITHIN GOVERNMENT.—The Office of

19 Personnel Management shall collect information concerning

20 training programs, plans, and methods utilized by agencies

21 of the Government and submit a report to the Congress on

22 this activity on an annual basis.

23 (b) TRAINING OUTSIDE OF GOVERNMENT.—The Office

24 of Personnel Management, to the extent it considers appro25 priate in the public interest, may collect information con-
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1 cerning training programs, plans, and methods utilized

2 outside the Government. The Office, on request, may make

3 such information available to an agency and to Congress.

4 TITLE III—ENHANCEMENT OF

5 THRIFT SAVINGS PLAN AND

6 CERTAIN OTHER BENEFITS

7 Subtitle A—Additional Investment

8 Funds for the Thrift Savings Plan

9 SEC. 301. SHORT TITLE.

10 This subtitle may be cited as the ‘‘Thrift Savings In11 vestment Funds Act of 1996’’.

12 SEC. 302. ADDITIONAL INVESTMENT FUNDS FOR THE

13 THRIFT SAVINGS PLAN.

14 Section 8438 of title 5, United States Code, is amend15 ed—

16 (1) in subsection (a)—

17 (A) by redesignating paragraphs (5)

18 through (8) as paragraphs (6) through (9), re19 spectively;

20 (B) by inserting after paragraph (4) the fol21 lowing:

22 ‘‘(5) the term ‘International Stock Index Invest23 ment Fund’ means the International Stock Index In24 vestment Fund established under subsection

25 (b)(1)(E);’’;
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1 (C) in paragraph (8) (as redesignated by

2 subparagraph (A) of this paragraph) by striking

3 ‘‘and’’ at the end;

4 (D) in paragraph (9) (as redesignated by

5 subparagraph (A) of this paragraph)—

6 (i) by striking ‘‘paragraph (7)(D)’’

7 each place it appears and inserting ‘‘para8 graph (8)(D)’’; and

9 (ii) by striking the period and insert10 ing a semicolon and ‘‘and’’; and

11 (E) by adding at the end the following:

12 ‘‘(10) the term ‘Small Capitalization Stock

13 Index Investment Fund’ means the Small Capitaliza14 tion Stock Index Investment Fund established under

15 subsection (b)(1)(D).’’; and

16 (2) in subsection (b)—

17 (A) in paragraph (1)—

18 (i) in subparagraph (B) by striking

19 ‘‘and’’ at the end;

20 (ii) in subparagraph (C) by striking

21 the period and inserting a semicolon; and

22 (iii) by adding at the end the follow23 ing:

24 ‘‘(D) a Small Capitalization Stock Index Invest25 ment Fund as provided in paragraph (3); and
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1 ‘‘(E) an International Stock Index Investment

2 Fund as provided in paragraph (4).’’; and

3 (B) by adding at the end the following:

4 ‘‘(3)(A) The Board shall select an index which is a

5 commonly recognized index comprised of common stock the

6 aggregate market value of which represents the United

7 States equity markets excluding the common stocks included

8 in the Common Stock Index Investment Fund.

9 ‘‘(B) The Small Capitalization Stock Index Investment

10 Fund shall be invested in a portfolio designed to replicate

11 the performance of the index in subparagraph (A). The

12 portfolio shall be designed such that, to the extent prac13 ticable, the percentage of the Small Capitalization Stock

14 Index Investment Fund that is invested in each stock is the

15 same as the percentage determined by dividing the aggre16 gate market value of all shares of that stock by the aggregate

17 market value of all shares of all stocks included in such

18 index.

19 ‘‘(4)(A) The Board shall select an index which is a

20 commonly recognized index comprised of stock the aggregate

21 market value of which is a reasonably complete representa22 tion of the international equity markets excluding the Unit23 ed States equity markets.

24 ‘‘(B) The International Stock Index Investment Fund

25 shall be invested in a portfolio designed to replicate the per-
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1 formance of the index in subparagraph (A). The portfolio

2 shall be designed such that, to the extent practicable, the

3 percentage of the International Stock Index Investment

4 Fund that is invested in each stock is the same as the per5 centage determined by dividing the aggregate market value

6 of all shares of that stock by the aggregate market value

7 of all shares of all stocks included in such index.’’.

8 SEC. 303. ACKNOWLEDGEMENT OF INVESTMENT RISK.

9 Section 8439(d) of title 5, United States Code, is

10 amended by striking ‘‘Each employee, Member, former em11 ployee, or former Member who elects to invest in the Com12 mon Stock Index Investment Fund or the Fixed Income In13 vestment Fund described in paragraphs (1) and (3),’’ and

14 inserting ‘‘Each employee, Member, former employee, or

15 former Member who elects to invest in the Common Stock

16 Index Investment Fund, the Fixed Income Investment

17 Fund, the International Stock Index Investment Fund, or

18 the Small Capitalization Stock Index Investment Fund, de19 fined in paragraphs (1), (3), (5), and (10),’’.

20 SEC. 304. EFFECTIVE DATE.

21 This subtitle shall take effect on the date of enactment

22 of this Act, and the Funds established under this subtitle

23 shall be offered for investment at the earliest practicable

24 election period (described in section 8432(b) of title 5, Unit-
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1 ed States Code) as determined by the Executive Director

2 in regulations.

3 Subtitle B—Thrift Savings Account

4 Liquidity

5 SEC. 311. SHORT TITLE.

6 This subtitle may be cited as the ‘‘Thrift Savings Plan

7 Act of 1996’’.

8 SEC. 312. NOTICE TO SPOUSES FOR IN-SERVICE WITHDRAW9 ALS; DE MINIMUS ACCOUNTS; CIVIL SERVICE

10 RETIREMENT SYSTEM PARTICIPANTS.

11 Section 8351(b) of title 5, United States Code, is

12 amended—

13 (1) in paragraph (5)—

14 (A) in subparagraph (B)—

15 (i) by striking ‘‘An election, change of

16 election, or modification (relating to the

17 commencement date of a deferred annuity)’’

18 and inserting ‘‘An election or change of elec19 tion’’;

20 (ii) by inserting ‘‘or withdrawal’’ after

21 ‘‘and a loan’’;

22 (iii) by inserting ‘‘and (h)’’ after

23 ‘‘8433(g)’’;
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1 (iv) by striking ‘‘the election, change of

2 election, or modification’’ and inserting

3 ‘‘the election or change of election’’; and

4 (v) by inserting ‘‘or withdrawal’’ after

5 ‘‘for such loan’’; and

6 (B) in subparagraph (D)—

7 (i) by inserting ‘‘or withdrawals’’ after

8 ‘‘of loans’’; and

9 (ii) by inserting ‘‘or (h)’’ after

10 ‘‘8433(g)’’; and

11 (2) in paragraph (6)—

12 (A) by striking ‘‘$3,500 or less’’ and insert13 ing ‘‘less than an amount that the Executive Di14 rector prescribes by regulation’’; and

15 (B) by striking ‘‘unless the employee or

16 Member elects, at such time and otherwise in

17 such manner as the Executive Director pre18 scribes, one of the options available under sub19 section (b)’’.

20 SEC. 313. IN-SERVICE WITHDRAWALS; WITHDRAWAL ELEC21 TIONS, FEDERAL EMPLOYEES’ RETIREMENT

22 SYSTEM PARTICIPANTS.

23 (a) IN GENERAL.—Section 8433 of title 5, United

24 States Code, is amended—
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1 (1) by striking subsections (b) and (c) and in2 serting the following:

3 ‘‘(b) Subject to section 8435 of this title, any employee

4 or Member who separates from Government employment is

5 entitled and may elect to withdraw from the Thrift Savings

6 Fund the balance of the employee’s or Member’s account

7 as—

8 ‘‘(1) an annuity;

9 ‘‘(2) a single payment;

10 ‘‘(3) 2 or more substantially equal payments to

11 be made not less frequently than annually; or

12 ‘‘(4) any combination of payments as provided

13 under paragraphs (1) through (3) as the Executive

14 Director may prescribe by regulation.

15 ‘‘(c)(1) In addition to the right provided under sub16 section (b) to withdraw the balance of the account, an em17 ployee or Member who separates from Government service

18 and who has not made a withdrawal under subsection

19 (h)(1)(A) may make one withdrawal of any amount as a

20 single payment in accordance with subsection (b)(2) from

21 the employee’s or Member’s account.

22 ‘‘(2) An employee or Member may request that the

23 amount withdrawn from the Thrift Savings Fund in ac24 cordance with subsection (b)(2) be transferred to an eligible

25 retirement plan.
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1 ‘‘(3) The Executive Director shall make each transfer

2 elected under paragraph (2) directly to an eligible retire3 ment plan or plans (as defined in section 402(c)(8) of the

4 Internal Revenue Code of 1986) identified by the employee,

5 Member, former employee, or former Member for whom the

6 transfer is made.

7 ‘‘(4) A transfer may not be made for an employee,

8 Member, former employee, or former Member under para9 graph (2) until the Executive Director receives from that

10 individual the information required by the Executive Direc11 tor specifically to identify the eligible retirement plan or

12 plans to which the transfer is to be made.’’;

13 (2) in subsection (d)—

14 (A) in paragraph (1) by striking ‘‘Subject

15 to paragraph (3)(A)’’ and inserting ‘‘Subject to

16 paragraph (3)’’;

17 (B) by striking paragraph (2) and redesig18 nating paragraph (3) as paragraph (2); and

19 (C) in paragraph (2) (as redesignated by

20 subparagraph (B) of this paragraph)—

21 (i) in subparagraph (A) by striking

22 ‘‘(A)’’; and

23 (ii) by striking subparagraph (B);

24 (3) in subsection (f)(1)—
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1 (A) by striking ‘‘$3,500 or less’’ and insert2 ing ‘‘less than an amount that the Executive Di3 rector prescribes by regulation’’; and

4 (B) by striking ‘‘unless the employee or

5 Member elects, at such time and otherwise in

6 such manner as the Executive Director pre7 scribes, one of the options available under sub8 section (b), or’’ and inserting a comma;

9 (4) in subsection (f)(2)—

10 (A) by striking ‘‘February 1’’ and inserting

11 ‘‘April 1’’;

12 (B) in subparagraph (A)—

13 (i) by striking ‘‘65’’ and inserting

‘‘701 14 ⁄2’’; and

15 (ii) by inserting ‘‘or’’ after the semi16 colon;

17 (C) by striking subparagraph (B); and

18 (D) by redesignating subparagraph (C) as

19 subparagraph (B);

20 (5) in subsection (g)—

21 (A) in paragraph (1) by striking ‘‘after De22 cember 31, 1987, and’’; and

23 (B) by striking paragraph (2) and redesig24 nating paragraphs (3) through (5) as para25 graphs (2) through (4), respectively; and
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1 (6) by adding after subsection (g) the following:

2 ‘‘(h)(1) An employee or Member may apply, before sep3 aration, to the Board for permission to withdraw an

4 amount from the employee’s or Member’s account based

5 upon—

6 ‘‘(A) the employee or Member having attained

age 591 7 ⁄2; or

8 ‘‘(B) financial hardship.

9 ‘‘(2) A withdrawal under paragraph (1)(A) shall be

10 available to each eligible participant one time only.

11 ‘‘(3) A withdrawal under paragraph (1)(B) shall be

12 available only for an amount not exceeding the value of that

13 portion of such account which is attributable to contribu14 tions made by the employee or Member under section

15 8432(a) of this title.

16 ‘‘(4) Withdrawals under paragraph (1) shall be subject

17 to such other conditions as the Executive Director may pre18 scribe by regulation.

19 ‘‘(5) A withdrawal may not be made under this sub20 section unless the requirements of section 8435(e) of this

21 title are satisfied.’’.

22 (b) INVALIDITY OF CERTAIN PRIOR ELECTIONS.—Any

23 election made under section 8433(b)(2) of title 5, United

24 States Code (as in effect before the effective date of this title),

25 with respect to an annuity which has not commenced before
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1 the implementation date of this title as provided by regula2 tion by the Executive Director in accordance with section

3 318, shall be invalid.

4 SEC. 314. SURVIVOR ANNUITIES FOR FORMER SPOUSES;

5 NOTICE TO FEDERAL EMPLOYEES’ RETIRE6 MENT SYSTEM SPOUSES FOR IN-SERVICE

7 WITHDRAWALS.

8 Section 8435 of title 5, United States Code, is amend9 ed—

10 (1) in subsection (a)(1)(A)—

11 (A) by striking ‘‘may make an election

12 under subsection (b)(3) or (b)(4) of section 8433

13 of this title or change an election previously

14 made under subsection (b)(1) or (b)(2) of such

15 section’’ and inserting ‘‘may withdraw all or

16 part of a Thrift Savings Fund account under

17 subsection (b) (2), (3), or (4) of section 8433 of

18 this title or change a withdrawal election’’; and

19 (B) by adding at the end ‘‘A married em20 ployee or Member (or former employee or Mem21 ber) may make a withdrawal from a Thrift Sav22 ings Fund account under subsection (c)(1) of sec23 tion 8433 of this title only if the employee or

24 Member (or former employee or Member) satisfies

25 the requirements of subparagraph (B).’’;
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1 (2) in subsection (c)—

2 (A) in paragraph (1)—

3 (i) by striking ‘‘An election, change of

4 election, or modification of the commence5 ment date of a deferred annuity’’ and in6 serting ‘‘An election or change of election’’;

7 and

8 (ii) by striking ‘‘modification, or

9 transfer’’ and inserting ‘‘or transfer’’; and

10 (B) in paragraph (2) in the matter follow11 ing subparagraph (B)(ii) by striking ‘‘modifica12 tion,’’;

13 (3) in subsection (e)—

14 (A) in paragraph (1)—

15 (i) in subparagraph (A)—

16 (I) by inserting ‘‘or withdrawal’’

17 after ‘‘A loan’’;

18 (II) by inserting ‘‘and (h)’’ after

19 ‘‘8433(g)’’; and

20 (III) by inserting ‘‘or with21 drawal’’ after ‘‘such loan’’;

22 (ii) in subparagraph (B) by inserting

23 ‘‘or withdrawal’’ after ‘‘loan’’; and

24 (iii) in subparagraph (C)—
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1 (I) by inserting ‘‘or withdrawal’’

2 after ‘‘to a loan’’; and

3 (II) by inserting ‘‘or withdrawal’’

4 after ‘‘for such loan’’; and

5 (B) in paragraph (2)—

6 (i) by inserting ‘‘or withdrawal’’ after

7 ‘‘loan’’; and

8 (ii) by inserting ‘‘and (h)’’ after

9 ‘‘8344(g)’’; and

10 (4) in subsection (g)—

11 (A) by inserting ‘‘or withdrawals’’ after

12 ‘‘loans’’; and

13 (B) by inserting ‘‘and (h)’’ after ‘‘8433(g)’’.

14 SEC. 315. DE MINIMUS ACCOUNTS RELATING TO THE JUDI15 CIARY.

16 (a) JUSTICES AND JUDGES.—Section 8440a(b)(7) of

17 title 5, United States Code, is amended—

18 (1) by striking ‘‘$3,500 or less’’ and inserting

19 ‘‘less than an amount that the Executive Director pre20 scribes by regulation’’; and

21 (2) by striking ‘‘unless the justice or judge elects,

22 at such time and otherwise in such manner as the

23 Executive Director prescribes, one of the options

24 available under section 8433(b)’’.
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1 (b) BANKRUPTCY JUDGES AND MAGISTRATES.—Sec2 tion 8440b(b) of title 5, United States Code, is amended—

3 (1) in paragraph (7) in the first sentence by in4 serting ‘‘of the distribution’’ after ‘‘equal to the

5 amount’’; and

6 (2) in paragraph (8)—

7 (A) by striking ‘‘$3,500 or less’’ and insert8 ing ‘‘less than an amount that the Executive Di9 rector prescribes by regulation’’; and

10 (B) by striking ‘‘unless the bankruptcy

11 judge or magistrate elects, at such time and oth12 erwise in such manner as the Executive Director

13 prescribes, one of the options available under

14 subsection (b)’’.

15 (c) FEDERAL CLAIMS JUDGES.—Section 8440c(b) of

16 title 5, United States Code, is amended—

17 (1) in paragraph (7) in the first sentence by in18 serting ‘‘of the distribution’’ after ‘‘equal to the

19 amount’’; and

20 (2) in paragraph (8)—

21 (A) by striking ‘‘$3,500 or less’’ and insert22 ing ‘‘less than an amount that the Executive Di23 rector prescribes by regulation’’; and

24 (B) by striking ‘‘unless the judge elects, at

25 such time and otherwise in such manner as the
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1 Executive Director prescribes, one of the options

2 available under section 8433(b)’’.

3 SEC. 316. DEFINITION OF BASIC PAY.

4 (a) IN GENERAL.—(1) Section 8401(4) of title 5, Unit5 ed States Code, is amended by striking ‘‘except as provided

6 in subchapter III of this chapter,’’.

7 (2) Section 8431 of title 5, United States Code, is re8 pealed.

9 (b) TECHNICAL AND CONFORMING AMENDMENTS.—(1)

10 The table of sections for chapter 84 of title 5, United States

11 Code, is amended by repealing the item relating to section

12 8431.

13 (2) Section 5545a(h)(2)(A) of title 5, United States

14 Code, is amended by striking ‘‘8431,’’.

15 (3) Section 616(f) of the Treasury, Postal Service, and

16 General Government Appropriations Act, 1996 (Public Law

17 104–52; 109 Stat. 500; 5 U.S.C. 5343 note) is amended by

18 striking ‘‘section 8431 of title 5, United States Code, and’’.

19 SEC. 317. ELIGIBLE ROLLOVER DISTRIBUTIONS.

20 Section 8432 of title 5, United States Code, is amended

21 by adding at the end the following:

22 ‘‘(j)(1) For the purpose of this subsection—

23 ‘‘(A) the term ‘eligible rollover distribution’ has

24 the meaning given such term by section 402(c)(4) of

25 the Internal Revenue Code of 1986; and
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1 ‘‘(B) the term ‘qualified trust’ has the meaning

2 given such term by section 402(c)(8) of the Internal

3 Revenue Code of 1986.

4 ‘‘(2) An employee or Member may contribute to the

5 Thrift Savings Fund an eligible rollover distribution from

6 a qualified trust. A contribution made under this subsection

7 shall be made in the form described in section 401(a)(31)

8 of the Internal Revenue Code of 1986. In the case of an

9 eligible rollover distribution, the maximum amount trans10 ferred to the Thrift Savings Fund shall not exceed the

11 amount which would otherwise have been included in the

12 employee’s or Member’s gross income for Federal income tax

13 purposes.

14 ‘‘(3) The Executive Director shall prescribe regulations

15 to carry out this subsection.’’.

16 SEC. 318. EFFECTIVE DATE.

17 This subtitle shall take effect on the date of the enact18 ment of this Act, and withdrawals, loans, rollovers, and

19 elections as provided under the amendments made by this

20 subtitle shall be made at the earliest practicable date as de21 termined by the Executive Director in regulations.

22 Subtitle C—Other Provisions

23 Relating to the Thrift Savings Plan

24 SEC. 321. PERCENTAGE LIMITATIONS ON CONTRIBUTIONS.

25 (a) AMENDMENTS RELATING TO FERS.—
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1 (1) IN GENERAL.—Subsection (a) of section 8432

2 of title 5, United States Code, is amended by striking

3 ‘‘10 percent of’’.

4 (2) JUSTICES AND JUDGES.—Subsection (b) of

5 section 8440a of title 5, United States Code, as

6 amended by section 315(a), is further amended—

7 (A) by striking paragraph (2) and by redes8 ignating paragraphs (3) through (7) as para9 graphs (2) through (6), respectively; and

10 (B) in paragraph (6) (as so redesignated by

11 subparagraph (A)) by striking ‘‘paragraphs (4)

12 and (5)’’ and inserting ‘‘paragraphs (3) and

13 (4)’’.

14 (3) BANKRUPTCY JUDGES AND MAGISTRATES.—

15 Subsection (b) of section 8440b of title 5, United

16 States Code, as amended by section 315(b), is further

17 amended—

18 (A) by striking paragraph (2) and by redes19 ignating paragraphs (3) through (8) as para20 graphs (2) through (7), respectively;

21 (B) in paragraph (4) (as so redesignated by

22 subparagraph (A)) by striking ‘‘paragraph

23 (4)(A), (B), or (C)’’ and inserting ‘‘paragraph

24 (3)(A), (B), or (C)’’; and
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1 (C) in paragraph (7) (as so redesignated by

2 subparagraph (A)) by striking ‘‘Notwithstanding

3 paragraph (4),’’ and inserting ‘‘Notwithstanding

4 paragraph (3),’’.

5 (4) COURT OF FEDERAL CLAIMS JUDGES.—Sub6 section (b) of section 8440c of title 5, United States

7 Code, as amended by section 315(c), is further amend8 ed—

9 (A) by striking paragraph (2) and by redes10 ignating paragraphs (3) through (8) as para11 graphs (2) through (7), respectively;

12 (B) in paragraph (4) (as so redesignated by

13 subparagraph (A)) by striking ‘‘paragraph

14 (4)(A) or (B)’’ and inserting ‘‘paragraph (3)(A)

15 or (B)’’; and

16 (C) in paragraph (7) (as so redesignated by

17 subparagraph (A)) by striking ‘‘Notwithstanding

18 paragraph (4),’’ and inserting ‘‘Notwithstanding

19 paragraph (3),’’.

20 (5) JUDGES OF THE UNITED STATES COURT OF

21 VETERANS APPEALS.—Paragraph (2) of section

22 8440d(b) of title 5, United States Code, is amended

23 to read as follows:
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1 ‘‘(2) For purposes of contributions made to the Thrift

2 Savings Fund, basic pay does not include any retired pay

3 paid pursuant to section 7296 of title 38.’’.

4 (b) AMENDMENTS RELATING TO CSRS.—Paragraph

5 (2) of section 8351(b) of title 5, United States Code, is

6 amended by striking ‘‘5 percent of’’.

7 (c) EFFECTIVE DATE.—

8 (1) IN GENERAL.—The amendments made by

9 this section shall take effect 6 months after the date

10 of the enactment of this Act or such earlier date as

11 the Executive Director may by regulation prescribe.

12 (2) COORDINATION WITH ELECTION PERIODS.—

13 The Executive Director shall by regulation determine

14 the first election period in which elections may be

15 made consistent with the amendments made by this

16 section.

17 (3) DEFINITIONS.—For purposes of this sub18 section—

19 (A) the term ‘‘election period’’ means a pe20 riod afforded under section 8432(b) of title 5,

21 United States Code; and

22 (B) the term ‘‘Executive Director’’ has the

23 meaning given such term by section 8401(13) of

24 title 5, United States Code.
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1 SEC. 322. LOANS UNDER THE THRIFT SAVINGS PLAN FOR

2 FURLOUGHED EMPLOYEES.

3 Section 8433(g) of title 5, United States Code, as

4 amended by section 313(a)(5)(B), is further amended by

5 adding at the end the following:

6 ‘‘(5) An employee who has been furloughed due to a

7 lapse in appropriations may not be denied a loan under

8 this subsection solely because such employee is not in a pay

9 status.’’.

10 SEC. 323. IMMEDIATE PARTICIPATION IN THE THRIFT SAV11 INGS PLAN.

12 (a) ELIMINATION OF CERTAIN WAITING PERIODS FOR

13 PURPOSES OF EMPLOYEE CONTRIBUTIONS.—Paragraph

14 (4) of section 8432(b) of title 5, United States Code, is

15 amended to read as follows:

16 ‘‘(4) The Executive Director shall prescribe such regu17 lations as may be necessary to carry out the following:

18 ‘‘(A) Notwithstanding subparagraph (A) of para19 graph (2), an employee or Member described in such

20 subparagraph shall be afforded a reasonable oppor21 tunity to first make an election under this subsection

22 beginning on the date of commencing service or, if

23 that is not administratively feasible, beginning on the

24 earliest date thereafter that such an election becomes

25 administratively feasible, as determined by the Execu26 tive Director.
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1 ‘‘(B) An employee or Member described in sub2 paragraph (B) of paragraph (2) shall be afforded a

3 reasonable opportunity to first make an election

4 under this subsection (based on the appointment or

5 election described in such subparagraph) beginning

6 on the date of commencing service pursuant to such

7 appointment or election or, if that is not administra8 tively feasible, beginning on the earliest date there9 after that such an election becomes administratively

10 feasible, as determined by the Executive Director.

11 ‘‘(C) Notwithstanding the preceding provisions of

12 this paragraph, contributions under paragraphs (1)

13 and (2) of subsection (c) shall not be payable with re14 spect to any pay period before the earliest pay period

15 for which such contributions would otherwise be al16 lowable under this subsection if this paragraph had

17 not been enacted.

18 ‘‘(D) Sections 8351(a)(2), 8440a(a)(2),

19 8440b(a)(2), 8440c(a)(2), and 8440d(a)(2) shall be

20 applied in a manner consistent with the purposes of

21 subparagraphs (A) and (B), to the extent those sub22 paragraphs can be applied with respect thereto.

23 ‘‘(E) Nothing in this paragraph shall affect

24 paragraph (3).’’.
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1 (b) TECHNICAL AND CONFORMING AMENDMENTS.—(1)

2 Section 8432(a) of title 5, United States Code, is amend3 ed—

4 (A) in the first sentence by striking ‘‘(b)(1)’’ and

5 inserting ‘‘(b)’’; and

6 (B) by amending the second sentence to read as

7 follows: ‘‘Contributions under this subsection pursu8 ant to such an election shall, with respect to each pay

9 period for which such election remains in effect, be

10 made in accordance with a program of regular con11 tributions provided in regulations prescribed by the

12 Executive Director.’’.

13 (2) Section 8432(b)(1)(B) of such title is amended by

14 inserting ‘‘(or any election allowable by virtue of paragraph

15 (4))’’ after ‘‘subparagraph (A)’’.

16 (3) Section 8432(b)(3) of such title is amended by

17 striking ‘‘Notwithstanding paragraph (2)(A), an’’ and in18 serting ‘‘An’’.

19 (4) Section 8432(i)(1)(B)(ii) of such title is amended

20 by striking ‘‘either elected to terminate individual contribu21 tions to the Thrift Savings Fund within 2 months before

22 commencing military service or’’.

23 (5) Section 8439(a)(1) of such title is amended by in24 serting ‘‘who makes contributions or’’ after ‘‘for each indi-
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1 vidual’’ and by striking ‘‘section 8432(c)(1)’’ and inserting

2 ‘‘section 8432’’.

3 (6) Section 8439(c)(2) of such title is amended by add4 ing at the end the following: ‘‘Nothing in this paragraph

5 shall be considered to limit the dissemination of informa6 tion only to the times required under the preceding sen7 tence.’’.

8 (7) Sections 8440a(a)(2) and 8440d(a)(2) of such title

9 are amended by striking ‘‘subject to’’ and all that follows

10 and inserting ‘‘subject to this chapter.’’.

11 (c) EFFECTIVE DATE.—This section shall take effect

12 6 months after the date of the enactment of this Act or such

13 earlier date as the Executive Director (within the meaning

14 of section 8401(13) of title 5, United States Code) may by

15 regulation prescribe.

16 Subtitle D—Resumption of Certain

17 Survivor Annuities That Termi18 nated by Reason of Marriage

19 SEC. 331. RESUMPTION OF CERTAIN SURVIVOR ANNUITIES

20 THAT TERMINATED BY REASON OF MAR21 RIAGE.

22 (a) CIVIL SERVICE RETIREMENT SYSTEM.—Section

23 8341(e) of title 5, United States Code, is amended by add24 ing at the end the following:
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1 ‘‘(4) If the annuity of a child under this subchapter

2 terminates under paragraph (3)(E) because of marriage,

3 then, if such marriage ends (whether by death of the spouse,

4 divorce, or annulment), such annuity shall resume on the

5 first day of the month in which the marriage ends, but only

6 if—

7 ‘‘(A) any lump sum paid is returned to the

8 Fund; and

9 ‘‘(B) that individual is not otherwise ineligible

10 for such annuity.’’.

11 (b) FEDERAL EMPLOYEES’ RETIREMENT SYSTEM.—

12 Section 8443(b) of such title is amended by adding at the

13 end the following: ‘‘If the annuity of a child under this sub14 chapter terminates under subparagraph (E) because of mar15 riage, then, if such marriage ends (whether by death of the

16 spouse, divorce, or annulment), such annuity shall resume

17 on the first day of the month in which the marriage ends,

18 but only if any lump sum paid is returned to the Fund,

19 and that individual is not otherwise ineligible for such an20 nuity.’’.

21 (c) HEALTH BENEFITS PROGRAM.—Section 8908 of

22 title 5, United States Code, is amended by adding at the

23 end the following:

24 ‘‘(d) An individual—
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1 ‘‘(1) whose survivor annuity under section

2 8341(e) is terminated, and then later restored under

3 paragraph (4) thereof, or

4 ‘‘(2) whose survivor annuity under section

5 8443(b) is terminated, and then later restored under

6 the last sentence thereof,

7 may, under regulations prescribed by the Office, enroll in

8 a health benefits plan described by section 8903 or 8903a

9 if such individual was covered by any such plan imme10 diately before such annuity so terminated.’’.

11 (d) APPLICABILITY.—The amendments made by this

12 section shall apply with respect to any termination of mar13 riage taking effect before, on, or after the date of the enact14 ment of this Act, except that no amount shall be payable

15 by reason of the amendments made by subsections (a) and

16 (b), respectively, except to the extent of any amounts accru17 ing for periods beginning on or after the first day of the

18 first month beginning on or after the later of—

19 (1) the date of the enactment of this Act; or

20 (2) the date as of which termination of marriage

21 takes effect.

22 Subtitle E—Life Insurance Benefits

23 SEC. 341. DOMESTIC RELATIONS ORDERS.

24 (a) IN GENERAL.—Section 8705 of title 5, United

25 States Code, is amended—
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1 (1) in subsection (a) by striking ‘‘(a) The’’ and

2 inserting ‘‘(a) Except as provided in subsection (e),

3 the’’; and

4 (2) by adding at the end the following:

5 ‘‘(e)(1) Any amount which would otherwise be paid to

6 a person determined under the order of precedence named

7 by subsection (a) shall be paid (in whole or in part) by

8 the Office to another person if and to the extent expressly

9 provided for in the terms of any court decree of divorce,

10 annulment, or legal separation, or the terms of any court

11 order or court-approved property settlement agreement inci12 dent to any court decree of divorce, annulment, or legal sep13 aration.

14 ‘‘(2) For purposes of this subsection, a decree, order,

15 or agreement referred to in paragraph (1) shall not be effec16 tive unless it is received, before the date of the covered em17 ployee’s death, by the employing agency or, if the employee

18 has separated from service, by the Office.

19 ‘‘(3) A designation under this subsection with respect

20 to any person may not be changed except—

21 ‘‘(A) with the written consent of such person, if

22 received as described in paragraph (2); or

23 ‘‘(B) by modification of the decree, order, or

24 agreement, as the case may be, if received as described

25 in paragraph (2).
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1 ‘‘(4) The Office shall prescribe any regulations nec2 essary to carry out this subsection, including regulations

3 for the application of this subsection in the event that 2

4 or more decrees, orders, or agreements, are received with

5 respect to the same amount.’’.

6 (b) DIRECTED ASSIGNMENT.—Section 8706(e) of title

7 5, United States Code, is amended—

8 (1) by striking ‘‘(e)’’ and inserting ‘‘(e)(1)’’; and

9 (2) by adding at the end the following:

10 ‘‘(2) A court decree of divorce, annulment, or legal sep11 aration, or the terms of a court-approved property settle12 ment agreement incidental to any court decree of divorce,

13 annulment, or legal separation, may direct that an insured

14 employee or former employee make an irrevocable assign15 ment of the employee’s or former employee’s incidents of

16 ownership in insurance under this chapter (if there is no

17 previous assignment) to the person specified in the court

18 order or court-approved property settlement agreement.’’.

19 SEC. 342. EXCEPTION FROM PROVISIONS REQUIRING RE20 DUCTION IN ADDITIONAL OPTIONAL LIFE IN21 SURANCE.

22 (a) IN GENERAL.—Subsection (c) of section 8714b of

23 title 5, United States Code, is amended by adding at the

24 end the following:
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1 ‘‘(3)(A) The amount of additional optional insurance

2 continued under paragraph (2) shall be continued, without

3 any reduction under the last two sentences thereof, if—

4 ‘‘(i) at the time of retirement, there is in effect

5 a designation under section 8705 under which the en6 tire amount of such insurance would be paid to an

7 individual who is permanently disabled; and

8 ‘‘(ii) an election under subsection (d)(3) on be9 half of such individual is made in timely fashion.

10 ‘‘(B) Notwithstanding subparagraph (A), any reduc11 tion required under paragraph (2) shall be made if—

12 ‘‘(i) the additional optional insurance is not in

13 fact paid in accordance with the designation under

14 section 8705, as in effect at the time of retirement;

15 ‘‘(ii) the Office finds that adequate arrangements

16 have not been made to ensure that the insurance pro17 vided under this section will be used only for the care

18 and support of the individual so designated; or

19 ‘‘(iii) the election referred to in subparagraph

20 (A)(ii) terminates at any time before the death of the

21 individual who made such election.

22 ‘‘(C) For purposes of this paragraph, the term ‘perma23 nently disabled’ shall have the meaning given such term

24 under regulations which the Office shall prescribe based on

25 subparagraphs (A) and (C) of section 1614(a)(3) of the So-
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1 cial Security Act, except that, in applying subparagraph

2 (A) of such section for purposes of this subparagraph,

3 ‘which can be expected to last permanently’ shall be sub4 stituted for ‘which has lasted or can be expected to last for

5 a continuous period of not less than twelve months’.’’.

6 (b) CONTINUED WITHHOLDINGS.—Subsection (d) of

7 such section 8714b is amended by adding at the end the

8 following:

9 ‘‘(3)(A) To be eligible for unreduced additional op10 tional insurance under subsection (c)(3), the insured indi11 vidual shall be required to elect, at such time and in such

12 manner as the Office by regulation requires (including pro13 cedures for demonstrating compliance with the require14 ments of subsection (c)(3)), to have the full cost thereof con15 tinue to be withheld from the former employee’s annuity

16 or compensation, as the case may be, beginning as of when

17 such withholdings would otherwise cease under the second

18 sentence of paragraph (1).

19 ‘‘(B) An election made by an insured individual under

20 subparagraph (A) (and withholdings pursuant thereto)

21 shall terminate in the event that—

22 ‘‘(i) the insured individual—

23 ‘‘(I) revokes such election; or
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1 ‘‘(II) makes any redesignation or other

2 change in the designation under section 8705 (as

3 in effect at the time of retirement); or

4 ‘‘(ii) the Office finds, upon the application of the

5 insured individual or on its own initiative, that any

6 of the requirements or conditions for unreduced addi7 tional optional insurance under subsection (c)(3) are,

8 at any time, no longer met.’’.

9 (c) EFFECTIVE DATE.—

10 (1) IN GENERAL.—The amendments made by

11 this section shall take effect on the date of the enact12 ment of this Act.

13 (2) ELECTION FOR CERTAIN INDIVIDUALS NOT

14 OTHERWISE ELIGIBLE.—The Office of Personnel Man15 agement shall prescribe regulations under which an

16 election under section 8714b(d)(3)(A) of title 5, Unit17 ed States Code (as amended by this section) may be

18 made, within 1 year after the date of the enactment

19 of this Act, by any individual not otherwise eligible

20 to make such an election, but only if such individ21 ual—

22 (A) separated from service on or after the

23 first day of the 50-month period ending on the

24 date of enactment of this Act; and
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1 (B) would have been so eligible had the

2 amendments made by this section (and imple3 menting regulations) been in effect as of the indi4 vidual’s separation date (or, if earlier, the last

5 day for making such an election based on that

6 separation).

7 (3) WITHHOLDINGS.—

8 (A) PROSPECTIVE EFFECT.—If an individ9 ual makes an election under paragraph (2),

10 withholdings under section 8714b(d)(3)(A) of

11 such title 5 shall thereafter be made from such

12 individual’s annuity or compensation, as the

13 case may be.

14 (B) EARLIER AMOUNTS.—If, pursuant to

15 such election, benefits are in fact paid in accord16 ance with section 8714b(c)(3) of such title 5

17 upon the death of the insured individual, an ap18 propriate reduction (computed under regulations

19 prescribed by the Office) shall be made in such

20 benefits to reflect the withholdings that—

21 (i) were not made (before the com22 mencement of withholdings under subpara23 graph (A)) by reason of the cessation of

24 withholdings under the second sentence of

25 section 8714b(d)(1) of such title; but
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1 (ii) would have been made had the

2 amendments made by this section (and im3 plementing regulations) been in effect as of

4 the time described in paragraph (2)(B).

5 (4) NOTICE.—The Office shall, by publication in

6 the Federal Register and such other methods as it con7 siders appropriate, notify current and former Federal

8 employees as to the enactment of this section and any

9 benefits for which they might be eligible pursuant

10 thereto. Included as part of such notification shall be

11 a brief description of the procedures for making an

12 election under paragraph (2) and any other informa13 tion that the Office considers appropriate.

14 TITLE IV—REORGANIZATION

15 FLEXIBILITY

16 SEC. 401. VOLUNTARY REDUCTIONS IN FORCE.

17 Section 3502(f) of title 5, United States Code, is

18 amended to read as follows:

19 ‘‘(f)(1) The head of an Executive agency or military

20 department may, in accordance with regulations prescribed

21 by the Office of Personnel Management—

22 ‘‘(A) separate from service any employee who

23 volunteers to be separated under this subparagraph

24 even though the employee is not otherwise subject to

25 separation due to a reduction in force; and
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1 ‘‘(B) for each employee voluntarily separated

2 under subparagraph (A), retain an employee in a

3 similar position who would otherwise be separated

4 due to a reduction in force.

5 ‘‘(2) The separation of an employee under paragraph

6 (1)(A) shall be treated as an involuntary separation due

7 to a reduction in force, except for purposes of priority place8 ment programs and advance notice.

9 ‘‘(3) An employee with critical knowledge and skills

10 (as defined by the head of the Executive agency or military

11 department concerned) may not participate in a voluntary

12 separation under paragraph (1)(A) if the agency or depart13 ment head concerned determines that such participation

14 would impair the performance of the mission of the agency

15 or department (as applicable).

16 ‘‘(4) The regulations prescribed under this section shall

17 incorporate the authority provided in this subsection.

18 ‘‘(5) No authority under paragraph (1) may be exer19 cised after September 30, 2001.’’.

20 SEC. 402. NONREIMBURSABLE DETAILS TO FEDERAL AGEN21 CIES BEFORE A REDUCTION IN FORCE.

22 (a) IN GENERAL.—Section 3341 of title 5, United

23 States Code, is amended to read as follows:
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1 ‘‘§ 3341. Details; within Executive agencies and mili2 tary departments; employees affected by

3 reduction in force

4 ‘‘(a) The head of an Executive agency or military de5 partment may detail employees, except those required by

6 law to be engaged exclusively in some specific work, among

7 the bureaus and offices of the agency or department.

8 ‘‘(b) The head of an Executive agency or military de9 partment may detail to duties in the same or another agen10 cy or department, on a nonreimbursable basis, an employee

11 who has been identified by the employing agency as likely

12 to be separated from the Federal service by reduction in

13 force or who has received a specific notice of separation by

14 reduction in force.

15 ‘‘(c)(1) Details under subsection (a)—

16 ‘‘(A) may not be for periods exceeding 120 days;

17 and

18 ‘‘(B) may be renewed (1 or more times) by writ19 ten order of the head of the agency or department, in

20 each particular case, for periods not exceeding 120

21 days each.

22 ‘‘(2) Details under subsection (b)—

23 ‘‘(A) may not be for periods exceeding 90 days;

24 and

25 ‘‘(B) may not be renewed.
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1 ‘‘(d) The 120-day limitation under subsection (c)(1)

2 for details and renewals of details does not apply to the

3 Department of Defense in the case of a detail—

4 ‘‘(1) made in connection with the closure or re5 alignment of a military installation pursuant to a

6 base closure law or an organizational restructuring of

7 the Department as part of a reduction in the size of

8 the armed forces or the civilian workforce of the De9 partment; and

10 ‘‘(2) in which the position to which the employee

11 is detailed is eliminated on or before the date of the

12 closure, realignment, or restructuring.

13 ‘‘(e) For purposes of this section—

14 ‘‘(1) the term ‘base closure law’ means—

15 ‘‘(A) section 2687 of title 10;

16 ‘‘(B) title II of the Defense Authorization

17 Amendments and Base Closure and Realignment

18 Act; and

19 ‘‘(C) the Defense Base Closure and Realign20 ment Act of 1990; and

21 ‘‘(2) the term ‘military installation’—

22 ‘‘(A) in the case of an installation covered

23 by section 2687 of title 10, has the meaning

24 given such term in subsection (e)(1) of such sec25 tion;
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1 ‘‘(B) in the case of an installation covered

2 by the Act referred to in subparagraph (B) of

3 paragraph (1), has the meaning given such term

4 in section 209(6) of such Act; and

5 ‘‘(C) in the case of an installation covered

6 by the Act referred to in subparagraph (C) of

7 paragraph (1), has the meaning given such term

8 in section 2910(4) of such Act.’’.

9 (b) CLERICAL AMENDMENT.—The table of sections for

10 chapter 33 of title 5, United States Code, is amended by

11 striking the item relating to section 3341 and inserting the

12 following:

‘‘3341. Details; within Executive agencies and military departments; employees

affected by reduction in force.’’.

13 (c) EFFECTIVE DATE.—The amendments made by this

14 section shall take effect 30 days after the date of the enact15 ment of this Act.

16 TITLE V—SOFT-LANDING

17 PROVISIONS

18 SEC. 501. TEMPORARY CONTINUATION OF FEDERAL EM19 PLOYEES’ LIFE INSURANCE.

20 Section 8706 of title 5, United States Code, is amended

21 by adding at the end the following:

22 ‘‘(g)(1) Notwithstanding subsections (a) and (b) of this

23 section, an employee whose coverage under this chapter

24 would otherwise terminate due to a separation described in
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1 paragraph (3) shall be eligible to continue basic insurance

2 coverage described in section 8704 in accordance with this

3 subsection and regulations the Office may prescribe, if the

4 employee arranges to pay currently into the Employees Life

5 Insurance Fund, through the former employing agency or,

6 if an annuitant, through the responsible retirement system,

7 an amount equal to the sum of—

8 ‘‘(A) both employee and agency contributions

9 which would be payable if separation had not oc10 curred; plus

11 ‘‘(B) an amount, determined under regulations

12 prescribed by the Office, to cover necessary adminis13 trative expenses, but not to exceed 2 percent of the

14 total amount under subparagraph (A).

15 ‘‘(2) Continued coverage under this subsection may not

16 extend beyond the date which is 18 months after the effective

17 date of the separation which entitles a former employee to

18 coverage under this subsection. Termination of continued

19 coverage under this subsection shall be subject to provision

20 for temporary extension of life insurance coverage and for

21 conversion to an individual policy of life insurance as pro22 vided by subsection (a). If an eligible employee does not

23 make an election for purposes of this subsection, the employ24 ee’s insurance will terminate as provided by subsection (a).
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1 ‘‘(3)(A) This subsection shall apply to an employee

2 who, on or after the date of enactment of this subsection

3 and before the applicable date under subparagraph (B)—

4 ‘‘(i) is involuntarily separated from a position

5 due to a reduction in force, or separates voluntarily

6 from a position the employing agency determines is

7 a ‘surplus position’ as defined by section

8 8905(d)(4)(C); and

9 ‘‘(ii) is insured for basic insurance under this

10 chapter on the date of separation.

11 ‘‘(B) The applicable date under this subparagraph is

12 October 1, 2001, except that, for purposes of any involun13 tary separation referred to in subparagraph (A) with re14 spect to which appropriate specific notice is afforded to the

15 affected employee before October 1, 2001, the applicable date

16 under this subparagraph is February 1, 2002.’’.

17 SEC. 502. CONTINUED ELIGIBILITY FOR HEALTH INSUR18 ANCE.

19 (a) CONTINUED ELIGIBILITY AFTER RETIREMENT.—

20 Section 8905 of title 5, United States Code, is amended—

21 (1) in the first sentence of subsection (b) by strik22 ing ‘‘An’’ and inserting ‘‘Subject to subsection (g),

23 an’’; and

24 (2) by adding at the end the following:
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1 ‘‘(g)(1) The Office shall waive the requirements for con2 tinued enrollment under subsection (b) in the case of any

3 individual who, on or after the date of the enactment of

4 this subsection and before the applicable date under para5 graph (2)—

6 ‘‘(A) is involuntarily separated from a position,

7 or voluntarily separated from a surplus position, in

8 or under an Executive agency due to a reduction in

9 force,

10 ‘‘(B) based on the separation referred to in sub11 paragraph (A), retires on an immediate annuity

12 under subchapter III of chapter 83 or subchapter II

13 of chapter 84, and

14 ‘‘(C) is enrolled in a health benefits plan under

15 this chapter as an employee immediately before retire16 ment.

17 ‘‘(2) The applicable date under this paragraph is Octo18 ber 1, 2001, except that, for purposes of any involuntary

19 separation referred to in paragraph (1)(A) with respect to

20 which appropriate specific notice is afforded to the affected

21 employee before October 1, 2001, the applicable date under

22 this paragraph is February 1, 2002.

23 ‘‘(3) For purposes of this subsection, the term ‘surplus

24 position’, with respect to an agency, means any position
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1 determined in accordance with regulations under section

2 8905a(d)(4)(C) for such agency.’’.

3 (b) TEMPORARY CONTINUED ELIGIBILITY AFTER

4 BEING INVOLUNTARILY SEPARATED.—Section 8905a(d)(4)

5 of title 5, United States Code, is amended—

6 (1) in subparagraph (A) by striking ‘‘the De7 partment of Defense’’ and inserting ‘‘an Executive

8 agency’’; and

9 (2) by amending subparagraph (C) to read as

10 follows:

11 ‘‘(C) For purposes of this paragraph, the term ‘surplus

12 position’ means a position that, as determined under regu13 lations prescribed by the head of the agency involved, is

14 identified during planning for a reduction in force as being

15 no longer required and is designated for elimination during

16 the reduction in force.’’.

17 SEC. 503. PRIORITY PLACEMENT PROGRAMS FOR FEDERAL

18 EMPLOYEES AFFECTED BY A REDUCTION IN

19 FORCE.

20 (a) IN GENERAL.—Subchapter I of chapter 33 of title

21 5, United States Code, is amended by adding at the end

22 the following:
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1 ‘‘§ 3330a. Priority placement programs for employees

2 affected by a reduction in force

3 ‘‘(a) Not later than 3 months after the date of the en4 actment of this section, each Executive agency shall estab5 lish an agencywide priority placement program, to facili6 tate employment placement for employees who—

7 ‘‘(1) are scheduled to be separated from service

8 due to a reduction in force under—

9 ‘‘(A) regulations prescribed under section

10 3502; or

11 ‘‘(B) procedures established under section

12 3595;

13 ‘‘(2) are separated from service due to such a re14 duction in force; or

15 ‘‘(3) have received a rating of at least fully suc16 cessful (or the equivalent) as the last performance rat17 ing of record used for retention purposes (except for

18 employees in positions excluded from a performance

19 appraisal system by law, regulation, or administra20 tive action taken by the Office of Personnel Manage21 ment).

22 ‘‘(b)(1) Each agencywide priority placement program

23 under this section shall include provisions under which a

24 vacant position shall not (except as provided in this sub25 section or any other statute providing the right of reemploy26 ment to any individual) be filled by the appointment or
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1 transfer of any individual from outside of that agency

2 (other than an individual described in paragraph (2)) if—

3 ‘‘(A) there is then available any individual de4 scribed in paragraph (2) who is qualified for the posi5 tion; and

6 ‘‘(B) the position—

7 ‘‘(i) is at the same grade or pay level (or

8 the equivalent) or not more than 3 grades (or

9 grade intervals) below that of the position last

10 held by such individual before placement in the

11 new position;

12 ‘‘(ii) is within the same commuting area as

13 the individual’s last-held position (as referred to

14 in clause (i)) or residence; and

15 ‘‘(iii) has the same type of work schedule

16 (whether full-time, part-time, or intermittent) as

17 the position last held by the individual.

18 ‘‘(2) For purposes of an agencywide priority place19 ment program, an individual shall be considered to be de20 scribed in this paragraph if such individual is—

21 ‘‘(A) an employee of such agency who is sched22 uled to be separated, as described in subsection (a)(1);

23 or

24 ‘‘(B) an individual who became a former em25 ployee of such agency as a result of a separation, as
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1 described in subsection (a)(2), excluding any individ2 ual who separated voluntarily under section 3502(f).

3 ‘‘(c)(1) If after a reduction in force the agency has no

4 positions of any type within the local commuting areas

5 specified in this section, the individual may designate a dif6 ferent local commuting area where the agency has continu7 ing positions in order to exercise reemployment rights

8 under this section. An agency may determine that such des9 ignations are not in the interest of the Government for the

10 purpose of paying relocation expenses under subchapter II

11 of chapter 57.

12 ‘‘(2) At its option, an agency may administratively

13 extend reemployment rights under this section to include

14 other local commuting areas.

15 ‘‘(d)(1) In selecting employees for positions under this

16 section, the agency shall place qualified present and former

17 employees in retention order by veterans’ preference sub18 group and tenure group.

19 ‘‘(2) An agency may not pass over a qualified present

20 or former employee to select an individual in a lower veter21 ans’ preference subgroup within the tenure group, or in a

22 lower tenure group.

23 ‘‘(3) Within a subgroup, the agency may select a quali24 fied present or former employee without regard to the indi25 vidual’s total creditable service.
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1 ‘‘(e) An individual is eligible for reemployment prior2 ity under this section for 2 years from the effective date

3 of the reduction in force from which the individual will be,

4 or has been, separated under section 3502.

5 ‘‘(f) An individual loses eligibility for reemployment

6 priority under this section when the individual—

7 ‘‘(1) requests removal in writing;

8 ‘‘(2) accepts or declines a bona fide offer under

9 this section or fails to accept such an offer within the

10 period of time allowed for such acceptance; or

11 ‘‘(3) separates from the agency before being sepa12 rated under section 3502.

13 A present or former employee who declines a position with

14 a representative rate (or equivalent) that is less than the

15 rate of the position from which the individual was sepa16 rated under section 3502 retains eligibility for positions

17 with a higher representative rate up to the rate of the indi18 vidual’s last position.

19 ‘‘(g) Whenever more than one individual is qualified

20 for a position under this section, the agency shall select the

21 most highly qualified individual, subject to subsection (d).

22 ‘‘(h) The Office of Personnel Management shall issue

23 regulations to implement this section.’’.

24 (b) CLERICAL AMENDMENT.—The table of sections for

25 chapter 33 of title 5, United States Code, is amended by
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1 adding after the item relating to the section 3330 the follow2 ing:

‘‘3330a. Priority placement programs for employees affected by a reduction in

force.’’.

3 SEC. 504. JOB PLACEMENT AND COUNSELING SERVICES.

4 (a) AUTHORITY FOR SERVICES.—The head of each Ex5 ecutive agency may establish a program to provide job

6 placement and counseling services to current and former

7 employees.

8 (b) TYPES OF SERVICES AUTHORIZED.—A program

9 established under this section may include such services

10 as—

11 (1) career and personal counseling;

12 (2) training in job search skills; and

13 (3) job placement assistance, including assistance

14 provided through cooperative arrangements with

15 State and local employment service offices.

16 (c) ELIGIBILITY FOR SERVICES.—Services authorized

17 by this section may be provided to—

18 (1) current employees of the agency or, with the

19 approval of such other agency, any other agency; and

20 (2) employees of the agency or, with the approval

21 of such other agency, any other agency who have been

22 separated for less than 1 year, if the separation was

23 not a removal for cause on charges of misconduct or

24 delinquency.
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1 (d) REIMBURSEMENT FOR COSTS.—The costs of serv2 ices provided to current or former employees of another

3 agency shall be reimbursed by that agency.

4 SEC. 505. EDUCATION AND RETRAINING INCENTIVES.

5 (a) NON-FEDERAL EMPLOYMENT INCENTIVE PAY6 MENTS.—

7 (1) DEFINITIONS.—For purposes of this sub8 section—

9 (A) the term ‘‘eligible employee’’ means an

10 employee who is involuntarily separated from a

11 position, or voluntarily separated from a surplus

12 position, in or under an Executive agency due to

13 a reduction in force, except that such term does

14 not include an employee who, at the time of sep15 aration, meets the age and service requirements

16 for an immediate annuity under subchapter III

17 of chapter 83 or chapter 84 of title 5, United

18 States Code, other than under section 8336(d) or

19 8414(b) of such title;

20 (B) the term ‘‘non-Federal employer’’ means

21 an employer other than the Government of the

22 United States or any agency or other instrumen23 tality thereof;
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1 (C) the term ‘‘Executive agency’’ has the

2 meaning given such term by section 105 of title

3 5, United States Code; and

4 (D) the term ‘‘surplus position’’ has the

5 meaning given such term by section

6 8905(d)(4)(C) of title 5, United States Code.

7 (2) AUTHORITY.—The head of an Executive

8 agency may pay retraining and relocation incentive

9 payments, in accordance with this subsection, in

10 order to facilitate the reemployment of eligible em11 ployees who are separated from such agency.

12 (3) RETRAINING INCENTIVE PAYMENT.—

13 (A) AGREEMENT.—The head of an Execu14 tive agency may enter into an agreement with a

15 non-Federal employer under which the non-Fed16 eral employer agrees—

17 (i) to employ an individual referred to

18 in paragraph (2) for at least 12 months for

19 a salary which is mutually agreeable to the

20 employer and such individual; and

21 (ii) to certify to the agency head any

22 costs incurred by the employer for any nec23 essary training provided to such individual

24 in connection with the employment by such

25 employer.
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1 (B) PAYMENT OF RETRAINING INCENTIVE

2 PAYMENT.—The agency head shall pay a retrain3 ing incentive payment to the non-Federal em4 ployer upon the employee’s completion of 12

5 months of continuous employment by that em6 ployer. The agency head shall prescribe the

7 amount of the incentive payment.

8 (C) PRORATION RULE.—The agency head

9 shall pay a prorated amount of the full retrain10 ing incentive payment to the non-Federal em11 ployer for an employee who does not remain em12 ployed by the non-Federal employer for at least

13 12 months, but only if the employee remains so

14 employed for at least 6 months.

15 (D) LIMITATION.—In no event may the

16 amount of the retraining incentive payment

17 paid for the training of any individual exceed

18 the amount certified for such individual under

19 subparagraph (A), subject to subsection (c).

20 (4) RELOCATION INCENTIVE PAYMENT.—The

21 head of an agency may pay a relocation incentive

22 payment to an eligible employee if it is necessary for

23 the employee to relocate in order to commence em24 ployment with a non-Federal employer. Subject to

25 subsection (e), the amount of the incentive payment
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1 shall not exceed the amount that would be payable for

2 travel, transportation, and subsistence expenses under

3 subchapter II of chapter 57 of title 5, United States

4 Code, including any reimbursement authorized under

5 section 5724b of such title, to a Federal employee who

6 transfers between the same locations as the individual

7 to whom the incentive payment is payable.

8 (5) DURATION.—No incentive payment may be

9 paid for training or relocation commencing after

10 June 30, 2002.

11 (6) SOURCE.—An incentive payment under this

12 subsection shall be payable from appropriations or

13 other funds available to the agency for purposes of

14 training (within the meaning of section 4101(4) of

15 title 5, United States Code).

16 (b) EDUCATIONAL ASSISTANCE.—

17 (1) DEFINITIONS.—For purposes of this sub18 section—

19 (A) the term ‘‘eligible employee’’ means an

20 eligible employee, within the meaning of sub21 section (a), who—

22 (i) is employed full time on a perma23 nent basis;
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1 (ii) has completed at least 3 years of

2 current continuous service in any Executive

3 agency or agencies; and

4 (iii) is admitted to an institution of

5 higher education within 1 year after sepa6 ration;

7 (B) the term ‘‘Executive agency’’ has the

8 meaning given such term by section 105 of title

9 5, United States Code;

10 (C) the term ‘‘educational assistance’’

11 means payments for educational assistance as

12 provided in section 127(c)(1) of the Internal

13 Revenue Code of 1986 (26 U.S.C. 127(c)(1)); and

14 (D) the term ‘‘institution of higher edu15 cation’’ has the meaning given such term by sec16 tion 1201(a) of the Higher Education Act of

17 1965 (20 U.S.C. 1141(a)).

18 (2) AUTHORITY.—Under regulations prescribed

19 by the Office of Personnel Management, and subject to

20 the limitations under subsection (c), the head of an

21 Executive agency may, in his or her discretion, pro22 vide educational assistance under this subsection to

23 an eligible employee for a program of education at an

24 institution of higher education after the separation of

25 the employee.
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1 (3) DURATION.—No educational assistance under

2 this subsection may be paid later than 10 years after

3 the separation of the eligible employee.

4 (4) SOURCE.—Educational assistance payments

5 shall be payable from appropriations or other funds

6 which would have been used to pay the salary of the

7 eligible employee if the employee had not separated.

8 (5) REGULATIONS.—The Office of Personnel

9 Management shall prescribe regulations for the ad10 ministration of this subsection. Such regulations shall

11 provide that educational assistance payments shall be

12 limited to amounts necessary for current tuition and

13 fees only.

14 (c) LIMITATIONS.—

15 (1) AGGREGATE LIMITATION.—No incentive pay16 ment or educational assistance payment may be paid

17 under this section to or on behalf of any individual

18 to the extent that such amount would cause the aggre19 gate amount otherwise paid or payable under this sec20 tion, to or on behalf of such individual, to exceed

21 $10,000.

22 (2) LIMITATION RELATING TO EDUCATIONAL AS23 SISTANCE.—The total amount paid under subsection

24 (b) to any individual—
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1 (A) may not exceed $6,000 if the individual

2 has at least 3 but less than 4 years of qualifying

3 service; and

4 (B) may not exceed $8,000 if the individual

5 has at least 4 but less than 5 years of qualifying

6 service.

7 (3) QUALIFYING SERVICE.—For purposes of

8 paragraph (2), the term ‘‘qualifying service’’ means

9 service performed as an employee, within the meaning

10 of section 2105 of title 5, United States Code, on a

11 permanent full-time or permanent part-time basis

12 (counting part-time service on a prorated basis).

13 TITLE VI—MISCELLANEOUS

14 SEC. 601. REIMBURSEMENTS RELATING TO PROFESSIONAL

15 LIABILITY INSURANCE.

16 (a) AUTHORITY.—Notwithstanding any other provi17 sion of law, any amounts appropriated, for fiscal year 1997

18 or any fiscal year thereafter, for salaries and expenses of

19 Government employees may be used to reimburse any quali20 fied employee for not to exceed one-half the costs incurred

21 by such employee for professional liability insurance. A

22 payment under this section shall be contingent upon the

23 submission of such information or documentation as the

24 employing agency may require.
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1 (b) QUALIFIED EMPLOYEE.—For purposes of this sec2 tion, the term ‘‘qualified employee’’ means—

3 (1) an agency employee whose position is that of

4 a law enforcement officer;

5 (2) an agency employee whose position is that of

6 a supervisor or management official; or

7 (3) such other employee as the head of the agency

8 considers appropriate

9 (c) DEFINITIONS.—For purposes of this section—

10 (1) the term ‘‘agency’’ means an Executive agen11 cy, as defined by section 105 of title 5, United States

12 Code;

13 (2) the term ‘‘law enforcement officer’’ means an

14 employee, the duties of whose position are primarily

15 the investigation, apprehension, prosecution, or deten16 tion of individuals suspected or convicted of offenses

17 against the criminal laws of the United States, in18 cluding any law enforcement officer under section

19 8331(20) or 8401(17) of such title 5;

20 (3) the terms ‘‘supervisor’’ and ‘‘management of21 ficial’’ have the respective meanings given them by

22 section 7103(a) of such title 5; and

23 (4) the term ‘‘professional liability insurance’’

24 means insurance which provides coverage for—
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1 (A) legal liability for damages due to inju2 ries to other persons, damage to their property,

3 or other damage or loss to such other persons (in4 cluding the expenses of litigation and settlement)

5 resulting from or arising out of any tortious act,

6 error, or omission of the covered individual

7 (whether common law, statutory, or constitu8 tional) while in the performance of such individ9 ual’s official duties as a qualified employee; and

10 (B) the cost of legal representation for the

11 covered individual in connection with any ad12 ministrative or judicial proceeding (including

13 any investigation or disciplinary proceeding) re14 lating to any act, error, or omission of the cov15 ered individual while in the performance of such

16 individual’s official duties as a qualified em17 ployee, and other legal costs and fees relating to

18 any such administrative or judicial proceeding.

19 (d) POLICY LIMITS.—

20 (1) IN GENERAL.—Reimbursement under this

21 section shall not be available except in the case of any

22 professional liability insurance policy providing

23 for—
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1 (A) not to exceed $1,000,000 of coverage for

2 legal liability (as described in subsection

3 (c)(4)(A)) per occurrence per year; and

4 (B) not to exceed $100,000 of coverage for

5 the cost of legal representation (as described in

6 subsection (c)(4)(B)) per occurrence per year.

7 (2) ADJUSTMENTS.—The head of an agency may

8 from time to time adjust the respective dollar amount

9 limitations applicable under this subsection to the ex10 tent that the head of such agency considers appro11 priate to reflect inflation.

12 SEC. 602. EMPLOYMENT RIGHTS FOLLOWING CONVERSION

13 TO CONTRACT.

14 (a) IN GENERAL.—An employee whose position is

15 abolished because an activity performed by an Executive

16 agency (within the meaning of section 105 of title 5, United

17 States Code) is converted to contract shall receive from the

18 contractor an offer in good faith of a right of first refusal

19 of employment under the contract for a position for which

20 the employee is deemed qualified based upon previous

21 knowledge, skills, abilities, and experience. The contractor

22 shall not offer employment under the contract to any person

23 prior to having complied fully with this obligation, except

24 as provided in subsection (b), or unless no employee whose

25 position is abolished because such activity has been con-
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1 verted to contract can demonstrate appropriate qualifica2 tions for the position.

3 (b) EXCEPTION.—Notwithstanding the contractor’s ob4 ligation under subsection (a), the contractor is not required

5 to offer a right of first refusal to any employee who, in the

6 12 months preceding conversion to contract, has been the

7 subject of an adverse personnel action related to misconduct

8 or has received a less than fully successful performance rat9 ing.

10 (c) LIMITATION.—No employee shall have a right to

11 more than 1 offer under this section based on any particu12 lar separation due to the conversion of an activity to con13 tract.

14 (d) REGULATIONS.—Regulations to carry out this sec15 tion may be prescribed by the President.

16 SEC. 603. DEBARMENT OF HEALTH CARE PROVIDERS

17 FOUND TO HAVE ENGAGED IN FRAUDULENT

18 PRACTICES.

19 (a) IN GENERAL.—Section 8902a of title 5, United

20 States Code, is amended—

21 (1) in subsection (a)(2)(A) by striking ‘‘sub22 section (b) or (c)’’ and inserting ‘‘subsection (b), (c),

23 or (d)’’;

24 (2) in subsection (b)—
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1 (A) by striking ‘‘may’’ and inserting

2 ‘‘shall’’ in the matter before paragraph (1); and

3 (B) by amending paragraph (5) to read as

4 follows:

5 ‘‘(5) Any provider that is currently suspended or

6 excluded from participation under any program of

7 the Federal Government involving procurement or

8 nonprocurement activities.’’;

9 (3) by redesignating subsections (c) through (i)

10 as subsections (d) through (j), respectively, and by in11 serting after subsection (b) the following:

12 ‘‘(c) The Office may bar the following providers of

13 health care services from participating in the program

14 under this chapter:

15 ‘‘(1) Any provider—

16 ‘‘(A) whose license to provide health care

17 services or supplies has been revoked, suspended,

18 restricted, or not renewed, by a State licensing

19 authority for reasons relating to the provider’s

20 professional competence, professional perform21 ance, or financial integrity; or

22 ‘‘(B) that surrendered such a license while

23 a formal disciplinary proceeding was pending

24 before such an authority, if the proceeding con-
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1 cerned the provider’s professional competence,

2 professional performance, or financial integrity.

3 ‘‘(2) Any provider that is an entity directly or

4 indirectly owned, or with a 5 percent or more control5 ling interest, by an individual who is convicted of

6 any offense described in subsection (b), against whom

7 a civil monetary penalty has been assessed under sub8 section (d), or who has been excluded from participa9 tion under this chapter.

10 ‘‘(3) Any provider that the Office determines, in

11 connection with claims presented under this chapter,

12 has charged for health care services or supplies in an

13 amount substantially in excess of such provider’s cus14 tomary charges for such services or supplies (unless

15 the Office finds there is good cause for such charge),

16 or charged for health care services or supplies which

17 are substantially in excess of the needs of the covered

18 individual or which are of a quality that fails to meet

19 professionally recognized standards for such services

20 or supplies.

21 ‘‘(4) Any provider that the Office determines has

22 committed acts described in subsection (d).’’;

23 (4) in subsection (d), as so redesignated by para24 graph (3), by amending paragraph (1) to read as fol25 lows:
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1 ‘‘(1) in connection with claims presented under

2 this chapter, that a provider has charged for a health

3 care service or supply which the provider knows or

4 should have known involves—

5 ‘‘(A) an item or service not provided as

6 claimed;

7 ‘‘(B) charges in violation of applicable

8 charge limitations under section 8904(b); or

9 ‘‘(C) an item or service furnished during a

10 period in which the provider was excluded from

11 participation under this chapter pursuant to a

12 determination by the Office under this section,

13 other than as permitted under subsection

14 (g)(2)(B);’’;

15 (5) in subsection (f), as so redesignated by para16 graph (3), by inserting ‘‘(where such debarment is not

17 mandatory)’’ after ‘‘under this section’’ the first place

18 it appears;

19 (6) in subsection (g), as so redesignated by para20 graph (3)—

21 (A) by striking ‘‘(g)(1)’’ and all that follows

22 through the end of paragraph (1) and inserting

23 the following:

24 ‘‘(g)(1)(A) Except as provided in subparagraph (B),

25 debarment of a provider under subsection (b) or (c) shall
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1 be effective at such time and upon such reasonable notice

2 to such provider, and to carriers and covered individuals,

3 as shall be specified in regulations prescribed by the Office.

4 Any such provider that is excluded from participation may

5 request a hearing in accordance with subsection (h)(1).

6 ‘‘(B) Unless the Office determines that the health or

7 safety of individuals receiving health care services warrants

8 an earlier effective date, the Office shall not make a deter9 mination adverse to a provider under subsection (c)(4) or

10 (d) until such provider has been given reasonable notice and

11 an opportunity for the determination to be made after a

12 hearing as provided in accordance with subsection (h)(1).’’;

13 (B) in paragraph (3)—

14 (i) by inserting ‘‘of debarment’’ after

15 ‘‘notice’’; and

16 (ii) by adding at the end the following:

17 ‘‘In the case of a debarment under para18 graphs (1) through (4) of subsection (b), the

19 minimum period of exclusion shall not be

20 less than 3 years, except as provided in

21 paragraph (4)(B)(ii).’’; and

22 (C) in paragraph (4)(B)(i)(I) by striking

23 ‘‘subsection (b) or (c)’’ and inserting ‘‘subsection

24 (b), (c), or (d)’’;
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1 (7) in subsection (h), as so redesignated by para2 graph (3), by striking ‘‘(h)(1)’’ and all that follows

3 through the end of paragraph (2) and inserting the

4 following:

5 ‘‘(h)(1) Any provider of health care services or supplies

6 that is the subject of an adverse determination by the Office

7 under this section shall be entitled to reasonable notice and

8 an opportunity to request a hearing of record, and to judi9 cial review as provided in this subsection after the Office

10 renders a final decision. The Office shall grant a request

11 for a hearing upon a showing that due process rights have

12 not previously been afforded with respect to any finding

13 of fact which is relied upon as a cause for an adverse deter14 mination under this section. Such hearing shall be con15 ducted without regard to subchapter II of chapter 5 and

16 chapter 7 of this title by a hearing officer who shall be des17 ignated by the Director of the Office and who shall not oth18 erwise have been involved in the adverse determination

19 being appealed. A request for a hearing under this sub20 section must be filed within such period and in accordance

21 with such procedures as the Office shall prescribe by regula22 tion.

23 ‘‘(2) Any provider adversely affected by a final deci24 sion under paragraph (1) made after a hearing to which

25 such provider was a party may seek review of such decision
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1 in the United States District Court for the District of Co2 lumbia or for the district in which the plaintiff resides or

3 has his principal place of business by filing a notice of ap4 peal in such court within 60 days from the date the decision

5 is issued and simultaneously sending copies of such notice

6 by certified mail to the Director of the Office and to the

7 Attorney General. In answer to the appeal, the Director of

8 the Office shall promptly file in such court a certified copy

9 of the transcript of the record, if the Office conducted a

10 hearing, and other evidence upon which the findings and

11 decision complained of are based. The court shall have

12 power to enter, upon the pleadings and evidence of record,

13 a judgment affirming, modifying, or setting aside, in whole

14 or in part, the decision of the Office, with or without re15 manding the cause for a rehearing. The district court shall

16 not set aside or remand the decision of the Office unless

17 there is not substantial evidence on the record, taken as a

18 whole, to support the findings by the Office of a cause for

19 action under this section or unless action taken by the Office

20 constitutes an abuse of discretion.’’; and

21 (8) in subsection (i), as so redesignated by para22 graph (3)—

23 (A) by striking ‘‘subsection (c)’’ and insert24 ing ‘‘subsection (d)’’; and
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1 (B) by adding at the end the following:

2 ‘‘The amount of a penalty or assessment as fi3 nally determined by the Office, or other amount

4 the Office may agree to in compromise, may be

5 deducted from any sum then or later owing by

6 the United States to the party against whom the

7 penalty or assessment has been levied.’’.

8 (b) EFFECTIVE DATE.—

9 (1) IN GENERAL.—Except as provided in para10 graph (2), this section shall take effect on the date of

11 the enactment of this Act.

12 (2) EXCEPTIONS.—(A) Paragraphs (2) and (4)

13 of section 8902a(c) of title 5, United States Code, as

14 amended by subsection (a), shall apply only to the ex15 tent that the misconduct which is the basis for debar16 ment thereunder occurs after the date of the enact17 ment of this Act.

18 (B) Section 8902a(d)(1)(B) of title 5, United

19 States Code, as amended by subsection (a), shall

20 apply only with respect to charges which violate sec21 tion 8904(b) of such title 5 for items and services fur22 nished after the date of the enactment of this Act.

23 (C) Section 8902a(g)(3) of title 5, United States

24 Code, as amended by subsection (a), shall apply only
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1 with respect to debarments based on convictions oc2 curring after the date of the enactment of this Act.

3 SEC. 604. CONVERSION OF CERTAIN EXCEPTED SERVICE

4 POSITIONS IN THE UNITED STATES FIRE AD5 MINISTRATION TO COMPETITIVE SERVICE PO6 SITIONS.

7 (a) IN GENERAL.—No later than the date described

8 under subsection (d)(1), the Director of the Federal Emer9 gency Management Agency and the Director of the Office

10 of Personnel Management shall take such actions as nec11 essary to convert each excepted service position established

12 before the date of the enactment of this Act under section

13 7(c)(4) of the Federal Fire Prevention and Control Act of

14 1974 (15 U.S.C. 2206(c)(4)) to a competitive service posi15 tion.

16 (b) EFFECT ON EMPLOYEES.—Any employee employed

17 on the date of the enactment of this Act in an excepted serv18 ice position converted under subsection (a)—

19 (1) shall remain employed in the competitive

20 service position so converted without a break in serv21 ice;

22 (2) by reason of such conversion, shall have no—

23 (A) diminution of seniority;

24 (B) reduction of cumulative years of service;

25 and
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1 (C) requirement to serve an additional pro2 bationary period applied; and

3 (3) shall retain their standing and participation

4 with respect to chapter 83 or 84 of title 5, United

5 States Code, relating to Federal retirement.

6 (c) PROSPECTIVE COMPETITIVE SERVICE POSI7 TIONS.—Section 7(c)(4) of the Federal Fire Prevention and

8 Control Act of 1974 (15 U.S.C. 2206(c)(4)) is amended to

9 read as follows:

10 ‘‘(4) appoint faculty members to competitive

11 service positions and with respect to temporary and

12 intermittent services, to make appointments of con13 sultants to the same extent as is authorized by section

14 3109 of title 5, United States Code;’’.

15 (d) EFFECTIVE DATE.—(1) Except as provided under

16 paragraph (2), this section shall take effect on the first day

17 of the first pay period, applicable to the positions described

18 under subsection (a), beginning after the date of the enact19 ment of this Act.

20 (2)(A) The Director of the Federal Emergency Manage21 ment Agency and the Director of the Office of Personnel

22 Management shall take such actions as directed under sub23 section (a) on and after the date of the enactment of this

24 Act.
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1 (B) Subsection (c) shall take effect on the date of the

2 enactment of this Act.

3 SEC. 605. ELIGIBILITY FOR CERTAIN SURVIVOR ANNUITY

4 BENEFITS.

5 For the purpose of determining eligibility for survivor

6 annuity benefits for a former spouse under section 8341 of

7 title 5, United States Code, an application of any former

8 spouse shall be approved if—

9 (1) the annuitant is deceased;

10 (2) the former spouse was living as of January

11 1, 1992;

12 (3) the former spouse has not received Social Se13 curity benefits based on eligibility as the spouse of the

14 annuitant;

15 (4) such application was filed on or after Janu16 ary 1, 1989;

17 (5) the annuitant rendered at least 25 years of

18 creditable service to the Federal Government;

19 (6) at the time of the annuitant’s retirement, the

20 annuitant and the former spouse had been married at

21 least 25 years;

22 (7) at the time of the annuitant’s retirement, the

23 annuitant designated the former spouse to receive sur24 vivor annuity benefits;
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1 (8) the annuitant and the former spouse were di2 vorced prior to September 14, 1978, and after the an3 nuitant retired;

4 (9) neither at the time of the divorce nor at any

5 time thereafter was a joint waiver of survivor annu6 ity benefits executed between the annuitant and the

7 former spouse;

8 (10) the divorce decree was silent as to survivor

9 annuity benefits or designated the former spouse to

10 receive survivor annuity benefits;

11 (11) subsequent to the divorce of the annuitant

12 and the former spouse, the annuitant advised the Of13 fice of Personnel Management of the divorce;

14 (12) neither the annuitant nor the former spouse

15 married any other individual after their divorce from

16 each other;

17 (13) no direct notice outlining or defining the

18 former spouse’s survivor annuity benefits election

19 rights was delivered to the former spouse by the Office

20 of Personnel Management; and

21 (14) the former spouse has exhausted all judicial

22 remedies up to and including remedies available

23 through the United States Court of Appeals.
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1 SEC. 606. AMENDMENT TO PUBLIC LAW 104–134.

2 Paragraph (3) of section 3110(b) of the Omnibus Con3 solidated Rescissions and Appropriations Act of 1996 (Pub4 lic Law 104–134; 110 Stat. 1321–343) is amended to read

5 as follows:

6 ‘‘(3) The Corporation shall pay to the Thrift Savings

7 Fund such employee and agency contributions as are re8 quired by sections 8432 and 8351 of title 5, United States

9 Code, for those employees who elect to retain their coverage

10 under the Civil Service Retirement System or the Federal

11 Employees’ Retirement System pursuant to paragraph

12 (1).’’.

13 SEC. 607. MISCELLANEOUS AMENDMENTS RELATING TO

14 THE HEALTH BENEFITS PROGRAM FOR FED15 ERAL EMPLOYEES.

16 (a) DEFINITION OF A CARRIER.—Paragraph (7) of sec17 tion 8901 of title 5, United States Code, is amended by

18 striking ‘‘organization;’’ and inserting ‘‘organization and

19 the Government-wide service benefit plan sponsored by an

20 association of organizations described in this paragraph;’’.

21 (b) SERVICE BENEFIT PLAN.—Paragraph (1) of sec22 tion 8903 of title 5, United States Code, is amended by

23 striking ‘‘plan,’’ and inserting ‘‘plan, underwritten by par24 ticipating affiliates licensed in any number of States,’’.

25 (c) PREEMPTION.—Section 8902(m) of title 5, United

26 States Code, is amended by striking ‘‘(m)(1)’’ and all that
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1 follows through the end of paragraph (1) and inserting the

2 following:

3 ‘‘(m)(1) The terms of any contract under this chapter

4 which relate to the nature, provision, or extent of coverage

5 or benefits (including payments with respect to benefits)

6 shall supersede and preempt any State or local law, or any

7 regulation issued thereunder, which relates to health insur8 ance or plans.’’.

9 SEC. 608. PAY FOR CERTAIN POSITIONS FORMERLY CLASSI10 FIED AT GS–18.

11 Notwithstanding any other provision of law, the rate

12 of basic pay for positions that were classified at GS–18 of

13 the General Schedule on the date of the enactment of the

14 Federal Employees Pay Comparability Act of 1990 shall

15 be set and maintained at the rate equal to the highest rate

16 of basic pay for the Senior Executive Service under section

17 5382(b) of title 5, United States Code.

18 SEC. 609. REPEAL OF SECTION 1307 OF TITLE 5 OF THE

19 UNITED STATES CODE.

20 (a) IN GENERAL.—Section 1307 of title 5, United

21 States Code, is repealed.

22 (b) CLERICAL AMENDMENT.—The table of sections for

23 chapter 13 of title 5, United States Code, is amended by

24 repealing the item relating to section 1307.
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1 SEC. 610. MANDATORY INTERNAL ALTERNATIVE DISPUTE

2 RESOLUTION PROCEDURES.

3 (a) IN GENERAL.—Notwithstanding any other provi4 sion of law, each agency, in consultation with the Federal

5 Mediation and Conciliation Service, may develop manda6 tory internal alternative dispute resolution procedures cov7 ering—

8 (1) any complaint of discrimination described in

9 clauses (i) through (v) of section 7702(a)(1)(B) of title

10 5, United States Code;

11 (2) any matter appealable to the Merit Systems

12 Protection Board (other than any matter arising

13 under subchapter III of chapter 83 or chapter 84 of

14 title 5, United States Code); and

15 (3) any matter reviewable by the Office of Spe16 cial Counsel.

17 (b) GUIDELINES.—The Federal Mediation and Concil18 iation Service, in conjunction with the Merit Systems Pro19 tection Board, the Equal Employment Opportunity Com20 mission, the Federal Labor Relations Authority, the Office

21 of Special Counsel, and the Office of Personnel Manage22 ment, shall issue guidelines to assist agencies in the formu23 lation of appropriate alternative dispute resolution proce24 dures. Such guidelines shall include protections against

25 undue influence on either part to settle, identification of

26 circumstances in which use of such procedures may be inap-
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1 propriate, suggested time frames for all steps in such proce2 dures and for extensions of time frames by mutual consent,

3 and procedures for agreements to stipulate to issues of fact

4 or law if no resolution is reached.

5 (c) DEFINITION.—For purposes of this section, the

6 term ‘‘agency’’ means an Executive agency, as defined by

7 section 105 of title 5, United States Code.