II 

108TH CONGRESS 

2D SESSION S. 2455 

To amend title II of the Social Security Act to repeal the windfall elimination 

provision and protect the retirement of public servants. 

IN THE SENATE OF THE UNITED STATES 

MAY 20, 2004 

Mrs. HUTCHISON introduced the following bill; which was read twice and 

referred to the Committee on Finance 

A BILL 

To amend title II of the Social Security Act to repeal the 

windfall elimination provision and protect the retirement 

of public servants. 

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

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Public Servant Retire5 ment Protection Act’’. 

6 SEC. 2. REPEAL OF CURRENT WINDFALL ELIMINATION 

7 PROVISION. 

8 Paragraph (7) of section 215(a) of the Social Secu9 rity Act (42 U.S.C. 415(a)(7)) is repealed. 
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1 SEC. 3. REPLACEMENT OF THE WINDFALL ELIMINATION 

2 PROVISION WITH A FORMULA EQUALIZING 

3 BENEFITS FOR CERTAIN INDIVIDUALS WITH 

4 NON-COVERED EMPLOYMENT. 

5 (a) SUBSTITUTION OF PROPORTIONAL FORMULA FOR

6 FORMULA BASED ON COVERED PORTION OF PERIODIC

7 BENEFIT.— 

8 (1) IN GENERAL.—Section 215(a) of the Social 

9 Security Act (as amended by section 2 of this Act) 

10 is amended further by inserting after paragraph (6) 

11 the following new paragraph: 

12 ‘‘(7)(A) In the case of an individual whose primary 

13 insurance amount would be computed under paragraph 

14 (1) of this subsection, who— 

15 ‘‘(i) attains age 62 after 1985 (except where he 

16 or she became entitled to a disability insurance ben17 efit before 1986 and remained so entitled in any of 

18 the 12 months immediately preceding his or her at19 tainment of age 62), or 

20 ‘‘(ii) would attain age 62 after 1985 and be21 comes eligible for a disability insurance benefit after 

22 1985, 

23 and who first becomes eligible after 1985 for a monthly 

24 periodic payment (including a payment determined under 

25 subparagraph (E), but excluding (I) a payment under the 

26 Railroad Retirement Act of 1974 or 1937, (II) a payment 
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1 by a social security system of a foreign country based on 

2 an agreement concluded between the United States and 

3 such foreign country pursuant to section 233, and (III) 

4 a payment based wholly on service as a member of a uni5 formed service (as defined in section 210(m)) which is 

6 based in whole or in part upon his or her earnings for 

7 service which did not constitute ‘employment’ as defined 

8 in section 210 for purposes of this title (hereafter in this 

9 paragraph and in subsection (d)(3) referred to as ‘non10 covered service’), the primary insurance amount of that 

11 individual during his or her concurrent entitlement to such 

12 monthly periodic payment and to old-age or disability in13 surance benefits shall be computed or recomputed under 

14 subparagraph (B) or subparagraph (D) (as applicable). 

15 ‘‘(B) In the case of an individual who first performs 

16 service described in subparagraph (A) after the 12th cal17 endar month following the date of the enactment of the 

18 Public Servant Retirement Protection Act, if paragraph 

19 (1) of this subsection would apply to such individual (ex20 cept for subparagraph (A) of this paragraph), the individ21 ual’s primary insurance amount shall be the product de22 rived by multiplying— 

23 ‘‘(i) the individual’s primary insurance amount, 

24 as determined under paragraph (1) of this sub-
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1 section and subparagraph (C)(i) of this paragraph, 

2 by 

3 ‘‘(ii) a fraction— 

4 ‘‘(I) the numerator of which is the individ5 ual’s average indexed monthly earnings (deter6 mined without regard to subparagraph (C)(i)), 

7 and 

8 ‘‘(II) the denominator of which is an 

9 amount equal to the individual’s average in10 dexed monthly earnings (as determined under 

11 subparagraph (C)(i)), 

12 rounded, if not a multiple of $0.10, to the next lower mul13 tiple of $0.10. 

14 ‘‘(C)(i) For purposes of determining an individual’s 

15 primary insurance amount pursuant to subparagraph 

16 (B)(i), the individual’s average indexed monthly earnings 

17 shall be determined by treating all service performed after 

18 1950 on which the individual’s monthly periodic payment 

19 referred to in subparagraph (A) is based (other than non20 covered service as a member of a uniformed service (as 

21 defined in section 210(m))) as ‘employment’ as defined in 

22 section 210 for purposes of this title (together with all 

23 other service performed by such individual consisting of 

24 ‘employment’ as so defined). 
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1 ‘‘(ii) For purposes of determining average indexed 

2 monthly earnings as described in clause (i), the Commis3 sioner of Social Security shall provide by regulation for 

4 a method for determining the amount of wages derived 

5 from service performed after 1950 on which the individ6 ual’s periodic benefit is based and which is to be treated 

7 as ‘employment’ solely for purposes of clause (i). Such 

8 method shall provide for reliance on employment records 

9 which are provided to the Commissioner and which con10 stitute a reasonable basis for treatment of service as ‘em11 ployment’ for such purposes, together with such other in12 formation received by the Commissioner as the Commis13 sioner may consider appropriate as a reasonable basis for 

14 treatment of service as ‘employment’ for such purposes. 

15 ‘‘(D)(i) In the case of an individual who has per16 formed service described in subparagraph (A) during or 

17 before the 12th calendar month following the date of the 

18 enactment of the Public Servant Retirement Protection 

19 Act, if paragraph (1) of this subsection would apply to 

20 such individual (except for subparagraph (A) of this para21 graph), there shall first be computed an amount equal to 

22 the individual’s primary insurance amount under para23 graph (1) of this subsection, except that for purposes of 

24 such computation the percentage of the individual’s aver25 age indexed monthly earnings established by subpara-
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1 graph (A)(i) of paragraph (1) shall be the percent speci2 fied in clause (ii). There shall then be computed (without 

3 regard to this paragraph) a second amount, which shall 

4 be equal to the individual’s primary insurance amount 

5 under paragraph (1) of this subsection, except that such 

6 second amount shall be reduced by an amount equal to 

7 one-half of the portion of the monthly periodic payment 

8 which is attributable to noncovered service performed after 

9 1956 (with such attribution being based on the propor10 tionate number of years of such noncovered service) and 

11 to which the individual is entitled (or is deemed to be enti12 tled) for the initial month of his or her concurrent entitle13 ment to such monthly periodic payment and old-age or dis14 ability insurance benefits. There shall then be computed 

15 (without regard to this paragraph) a third amount, which 

16 shall be equal to the individual’s primary insurance 

17 amount determined under subparagraph (B) as if sub18 paragraph (B) applied in the case of such individual. The 

19 individual’s primary insurance amount shall be the largest 

20 of the three amounts computed under this subparagraph 

21 (before the application of subsection (i)). 

22 ‘‘(ii) For purposes of clause (i), the percent specified 

23 in this clause is— 

24 ‘‘(I) 80.0 percent with respect to individuals 

25 who become eligible (as defined in paragraph (3)(B)) 
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1 for old-age insurance benefits (or became eligible as 

2 so defined for disability insurance benefits before at3 taining age 62) in 1986; 

4 ‘‘(II) 70.0 percent with respect to individuals 

5 who so become eligible in 1987; 

6 ‘‘(III) 60.0 percent with respect to individuals 

7 who so become eligible in 1988; 

8 ‘‘(IV) 50.0 percent with respect to individuals 

9 who so become eligible in 1989; and 

10 ‘‘(V) 40.0 percent with respect to individuals 

11 who so become eligible in 1990 or thereafter. 

12 ‘‘(E)(i) Any periodic payment which otherwise meets 

13 the requirements of subparagraph (A), but which is paid 

14 on other than a monthly basis, shall be allocated on a basis 

15 equivalent to a monthly payment (as determined by the 

16 Commissioner of Social Security), and such equivalent 

17 monthly payment shall constitute a monthly periodic pay18 ment for purposes of this paragraph. 

19 ‘‘(ii) In the case of an individual who has elected to 

20 receive a periodic payment that has been reduced so as 

21 to provide a survivor’s benefit to any other individual, the 

22 payment shall be deemed to be increased (for purposes of 

23 any computation under this paragraph or subsection 

24 (d)(3) by the amount of such reduction. 
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1 ‘‘(iii) For purposes of this paragraph, the term ‘peri2 odic payment’ includes a payment payable in a lump sum 

3 if it is a commutation of, or a substitute for, periodic pay4 ments. 

5 ‘‘(F)(i) Subparagraph (D) shall not apply in the case 

6 of an individual who has 30 years or more of coverage. 

7 In the case of an individual who has more than 20 years 

8 of coverage but less than 30 years of coverage (as so de9 fined), the percent specified in the applicable subdivision 

10 of subparagraph (D)(ii) shall (if such percent is smaller 

11 than the applicable percent specified in the following table) 

12 be deemed to be the applicable percent specified in the 

13 following table: 

‘‘If the number of such individual’s years of 

coverage (as so defined) is: 

The applicable 

percent is: 

29 ........................................................................... 85 percent

28 ........................................................................... 80 percent

27 ........................................................................... 75 percent

26 ........................................................................... 70 percent

25 ........................................................................... 65 percent

24 ........................................................................... 60 percent

23 ........................................................................... 55 percent

22 ........................................................................... 50 percent

21 ........................................................................... 45 percent.

14 ‘‘(ii) For purposes of clause (i), the term ‘year of cov15 erage’ shall have the meaning provided in paragraph 

16 (1)(C)(ii), except that the reference to ‘15 percent’ therein 

17 shall be deemed to be a reference to ‘25 percent’. 

18 ‘‘(G) An individual’s primary insurance amount de19 termined under this paragraph shall be deemed to be com-
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1 puted under paragraph (1) of this subsection for the pur2 pose of applying other provisions of this title. 

3 ‘‘(H) This paragraph shall not apply in the case of 

4 an individual whose eligibility for old-age or disability in5 surance benefits is based on an agreement concluded pur6 suant to section 233 or an individual who on January 1, 

7 1984— 

8 ‘‘(i) is an employee performing service to which 

9 social security coverage is extended on that date 

10 solely by reason of the amendments made by section 

11 101 of the Social Security Amendments of 1983; or 

12 ‘‘(ii) is an employee of a nonprofit organization 

13 which (on December 31, 1983) did not have in effect 

14 a waiver certificate under section 3121(k) of the In15 ternal Revenue Code of 1954 and to the employees 

16 of which social security coverage is extended on that 

17 date solely by reason of the amendments made by 

18 section 102 of that Act, unless social security cov19 erage had previously extended to service performed 

20 by such individual as an employee of that organiza21 tion under a waiver certificate which was subse22 quently (prior to December 31, 1983) terminated.’’. 

23 (2) CONFORMING AMENDMENTS.—— 

24 (A) Section 215(d)(3) of such Act (42 

25 U.S.C. 415(d)(3)) is amended— 
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1 (i) by striking ‘‘subsection (a)(7)(C)’’ 

2 each place it appears and inserting ‘‘sub3 section (a)(7)(E)’’; 

4 (ii) by striking ‘‘subparagraph (E)’’ 

5 and inserting ‘‘subparagraph (H)’’; and 

6 (iii) by striking ‘‘subparagraph (D)’’ 

7 and inserting ‘‘subparagraph (F)(i)’’. 

8 (B) Section 215(f)(9)(A) of such Act (42 

9 U.S.C. 415(f)(9)(A)) is amended by striking 

10 ‘‘(a)(7)(C)’’ and inserting ‘‘(a)(7)(E)’’. 

11 SEC. 4. EFFECTIVE DATE. 

12 The amendments made by this Act shall apply with 

13 respect to monthly insurance benefits for months com14 mencing with or after the 12th calendar month following 

15 the date of the enactment of this Act. Notwithstanding 

16 section 215(f) of the Social Security Act, the Commis17 sioner of Social Security shall recompute primary insur18 ance amounts to the extent necessary to carry out the 

19 amendments made by this Act. 

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