I 

108TH CONGRESS 

2D SESSION H. R. 4657 

To amend the Balanced Budget Act of 1997 to improve the administration 

of Federal pension benefit payments for District of Columbia teachers, 

police officers, and fire fighters, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JUNE 23, 2004 

Mr. TOM DAVIS of Virginia (for himself and Mr. HOYER) introduced the 

following bill; which was referred to the Committee on Government Reform 

A BILL 

To amend the Balanced Budget Act of 1997 to improve 

the administration of Federal pension benefit payments 

for District of Columbia teachers, police officers, and 

fire fighters, and for other purposes. 

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

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘District of Columbia 

5 Retirement Protection Improvement Act of 2004’’. 
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1 SEC. 2. ESTABLISHMENT OF DISTRICT OF COLUMBIA FED2 ERAL PENSION FUND FOR PAYMENT OF FED3 ERAL BENEFIT PAYMENTS TO DISTRICT OF 

4 COLUMBIA TEACHERS, POLICE OFFICERS, 

5 AND FIRE FIGHTERS. 

6 (a) IN GENERAL.—Subtitle A of title XI of the Bal7 anced Budget Act of 1997 (sec. 1–801.01 et seq., D.C. 

8 Official Code) is amended— 

9 (1) by redesignating chapter 9 as chapter 10; 

10 (2) by redesignating sections 11081 through 

11 11087 as sections 11091 through 11097; and 

12 (3) by inserting after chapter 8 the following 

13 new chapter: 

14 ‘‘CHAPTER 9—DISTRICT OF COLUMBIA 

15 FEDERAL PENSION FUND 

16 ‘‘SEC. 11081. CREATION OF FUND. 

17 ‘‘(a) ESTABLISHMENT.—There is established on the 

18 books of the Treasury the District of Columbia Teachers, 

19 Police Officers, and Firefighters Federal Pension Fund 

20 (hereafter referred to as the ‘D.C. Federal Pension 

21 Fund’), consisting of the following: 

22 ‘‘(1) The assets transferred pursuant to section 

23 11083. 

24 ‘‘(2) The annual Federal payments deposited 

25 pursuant to section 11084. 
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1 ‘‘(3) Any amounts otherwise appropriated to 

2 such Fund. 

3 ‘‘(4) Any income earned on the investment of 

4 the assets of such Fund pursuant to subsection (b). 

5 ‘‘(b) INVESTMENT OF ASSETS.—The Secretary shall 

6 invest such portion of the assets of the D.C. Federal Pen7 sion Fund as is not in the judgment of the Secretary re8 quired to meet current withdrawals. Such investments 

9 shall be in public debt securities with maturities suitable 

10 to the needs of the D.C. Federal Pension Fund, as deter11 mined by the Secretary, and bearing interest at rates de12 termined by the Secretary, taking into consideration cur13 rent market yields on outstanding marketable obligations 

14 of the United States of comparable maturities. 

15 ‘‘(c) RECORDKEEPING FOR ACTUARIAL STATUS.— 

16 The Secretary shall provide for the keeping of such 

17 records as are necessary for determining the actuarial sta18 tus of the D.C. Federal Pension Fund. 

19 ‘‘SEC. 11082. USES OF AMOUNTS IN FUND. 

20 ‘‘(a) IN GENERAL.—Amounts in the D.C. Federal 

21 Pension Fund shall be used— 

22 ‘‘(1) to make Federal benefit payments under 

23 this subtitle; 

24 ‘‘(2) subject to subsection (b), to cover the rea25 sonable and necessary administrative expenses in-
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1 curred by any person in administering the D.C. Fed2 eral Pension Fund and carrying out this chapter; 

3 ‘‘(3) for the accumulation of funds in order to 

4 finance obligations of the Federal Government for 

5 future benefits; and 

6 ‘‘(4) for such other purposes as are specified in 

7 this subtitle. 

8 ‘‘(b) BUDGETING, CERTIFICATION, AND APPROVAL

9 OF ADMINISTRATIVE EXPENSES.—The administrative ex10 penses of the D.C. Federal Pension Fund shall be paid 

11 in accordance with an annual budget set forth by the Pen12 sion Fund Trustee which shall be subject to certification 

13 and approval by the Secretary. 

14 ‘‘SEC. 11083. TRANSFER OF ASSETS AND OBLIGATIONS OF 

15 TRUST FUND AND FEDERAL SUPPLEMENTAL 

16 FUND. 

17 ‘‘(a) TRANSFER OF OBLIGATIONS.—Effective Octo18 ber 1, 2004, all obligations to make Federal benefit pay19 ments shall be transferred from the Trust Fund to the 

20 D.C. Federal Pension Fund. 

21 ‘‘(b) TRANSFER OF ASSETS.—Effective October 1, 

22 2004, all assets of the Trust Fund and all assets of the 

23 Federal Supplemental Fund as of such date shall be trans24 ferred to the D.C. Federal Pension Fund. 
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1 ‘‘SEC. 11084. DETERMINATION OF ANNUAL FEDERAL PAY2 MENTS INTO D.C. FEDERAL PENSION FUND. 

3 ‘‘(a) ANNUAL AMORTIZATION AMOUNT.— 

4 ‘‘(1) IN GENERAL.—At the end of each fiscal 

5 year (beginning with fiscal year 2005), the Secretary 

6 shall promptly pay into the D.C. Federal Pension 

7 Fund from the general fund of the Treasury an 

8 amount equal to the annual amortization amount for 

9 the year (which may not be less than zero). 

10 ‘‘(2) DETERMINATION OF AMOUNT.—For pur11 poses of paragraph (1)— 

12 ‘‘(A) the ‘original unfunded liability’ is the 

13 present value as of the effective date of this Act 

14 of expected future benefits payable from the 

15 Federal Supplemental Fund; and 

16 ‘‘(B) the ‘annual amortization amount’ 

17 means the amount determined by the enrolled 

18 actuary to be necessary to amortize in equal an19 nual installments (until fully amortized)— 

20 ‘‘(i) the original unfunded liability 

21 over a 30-year period, 

22 ‘‘(ii) a net experience gain or loss over 

23 a 10-year period, and 

24 ‘‘(iii) any other changes in actuarial 

25 liability over a 20-year period. 
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1 ‘‘(3) SCHEDULE FOR AMORTIZATION.—In deter2 mining the annual amortization amount under para3 graph (2)(B), the enrolled actuary shall include 

4 amounts necessary to complete the amortization 

5 schedules used for determining the annual amortiza6 tion amount for payments into the Federal Supple7 mental Fund under section 11053 (as in effect prior 

8 to the enactment of this chapter). 

9 ‘‘(b) ADMINISTRATIVE EXPENSES.—During each fis10 cal year (beginning with fiscal year 2009), the Secretary 

11 shall pay into the D.C. Federal Pension Fund from the 

12 general fund of the Treasury the amounts necessary to 

13 pay the reasonable and necessary administrative expenses 

14 described in section 11082(a)(2) for the year. 

15 ‘‘SEC. 11085. ADMINISTRATION THROUGH PENSION FUND 

16 TRUSTEE. 

17 ‘‘(a) IN GENERAL.—The Secretary shall select a Pen18 sion Fund Trustee to carry out the responsibilities and 

19 duties specified in this subtitle in accordance with the con20 tract described in subsection (b). 

21 ‘‘(b) CONTRACT.—The Secretary shall enter into a 

22 contract with the Pension Fund Trustee to provide for the 

23 auditing of D.C. Federal Pension Fund assets, the making 

24 of Federal benefit payments under this subtitle from the 

25 D.C. Federal Pension Fund, and such other matters as 
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1 the Secretary deems appropriate. The Secretary shall en2 force the provisions of the contract and otherwise monitor 

3 the administration of the D.C. Federal Pension Fund. 

4 ‘‘(c) SUBCONTRACTS.—Notwithstanding any provi5 sion of a District Retirement Program or any other law, 

6 rule, or regulation, the Pension Fund Trustee may, with 

7 the approval of the Secretary, enter into one or more sub8 contracts with the District Government or any person to 

9 provide services to the Pension Fund Trustee in connec10 tion with its performance of the contract. The Pension 

11 Fund Trustee shall monitor the performance of any such 

12 subcontract and enforce its provisions. 

13 ‘‘(d) DETERMINATION BY THE SECRETARY.—Not14 withstanding subsection (b) or any other provision of this 

15 subtitle, the Secretary may determine, with respect to any 

16 function otherwise to be performed by the Pension Fund 

17 Trustee, that in the interest of economy and efficiency 

18 such function shall be performed by the Secretary rather 

19 than the Pension Fund Trustee. 

20 ‘‘(e) REPORTS.—The Pension Fund Trustee shall re21 port to the Secretary, in a form and manner and at such 

22 intervals as the Secretary may prescribe, on any matters 

23 under the responsibility of the Pension Fund Trustee as 

24 the Secretary may prescribe. 
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1 ‘‘SEC. 11086. APPLICABILITY OF OTHER PROVISIONS TO D.C. 

2 FEDERAL PENSION FUND. 

3 ‘‘The following provisions of this subtitle shall apply 

4 with respect to the D.C. Federal Pension Fund in the 

5 same manner as such provisions applied with respect to 

6 the Trust Fund prior to October 1, 2004: 

7 ‘‘(1) Section 11023(b) (relating to the repay8 ment by the District Government of costs attrib9 utable to errors or omissions in transferred records). 

10 ‘‘(2) Section 11034 (relating to the treatment 

11 of the Trust Fund under certain laws). 

12 ‘‘(3) Section 11061 (relating to annual valu13 ations and reports by the enrolled actuary), except 

14 that in applying section 11061(b) to the D.C. Fed15 eral Pension Fund, the annual report required under 

16 such section shall include a determination of the an17 nual payment to the D.C. Federal Pension Fund 

18 under section 11084. 

19 ‘‘(4) Section 11062 (relating to reports by the 

20 Comptroller General). 

21 ‘‘(5) Section 11071 (relating to judicial review). 

22 ‘‘(6) Section 11074 (relating to the treatment 

23 of misappropriation of Trust Fund amounts as a 

24 Federal crime).’’. 

25 (b) TERMINATION OF CURRENT FUNDS.— 
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1 (1) DISTRICT OF COLUMBIAFEDERAL PENSION

2 LIABILITY TRUST FUND.—Chapter 4 of subtitle A of 

3 title XI of such Act (sec. 1–807.01 et seq., D.C. Of4 ficial Code) is amended by adding at the end the fol5 lowing new section: 

6 ‘‘SEC. 11036. TERMINATION OF TRUST FUND. 

7 ‘‘Effective upon the transfer of the obligations and 

8 assets of the Trust Fund to the D.C. Federal Pension 

9 Fund under section 11083— 

10 ‘‘(1) the Trust Fund shall terminate; and 

11 ‘‘(2) the obligation to make Federal benefit 

12 payments from the Trust Fund, and any duty im13 posed on any person with respect to the Trust Fund, 

14 shall terminate.’’. 

15 (2) FEDERAL SUPPLEMENTAL DISTRICT OF CO16 LUMBIAPENSION FUND.—Chapter 6 of subtitle A of 

17 title XI of such Act (sec. 1–811.01 et seq., D.C. Of18 ficial Code) is amended by adding at the end the fol19 lowing new section: 

20 ‘‘SEC. 11056. TERMINATION OF FEDERAL SUPPLEMENTAL 

21 FUND. 

22 ‘‘Effective upon the transfer of the assets of the Fed23 eral Supplemental Fund to the D.C. Federal Pension 

24 Fund under section 11083— 
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1 ‘‘(1) the Federal Supplemental Fund shall ter2 minate; and 

3 ‘‘(2) any duty imposed on any person with re4 spect to the Federal Supplemental fund shall termi5 nate.’’. 

6 (c) CONFORMING DEFINITIONS.— 

7 (1) TRUSTEE.—Section 11003(16) of such Act 

8 (sec. 1–801.02(16), D.C. Official Code) is amended 

9 by striking the period at the end and inserting the 

10 following: ‘‘, or, beginning October 1, 2004, the Pen11 sion Fund Trustee selected by the Secretary under 

12 section 11085.’’. 

13 (2) D.C. FEDERAL PENSION FUND.—Section 

14 11003 of such Act (sec. 1–801.02, D.C. Official 

15 Code) is amended— 

16 (A) by redesignating paragraphs (3) 

17 through (16) as paragraphs (4) through (17); 

18 and 

19 (B) by inserting after paragraph (2) the 

20 following new paragraph: 

21 ‘‘(3) The term ‘D.C. Federal Pension Fund’ 

22 means the District of Columbia Teachers, Police Of23 ficers, and Firefighters Federal Pension Fund estab24 lished under section 11081.’’. 
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1 (d) OTHER CONFORMING AMENDMENT.—Section 

2 11041(b) of such Act (sec. 1–809.01(b), D.C. Official 

3 Code) is amended in the heading by striking ‘‘FROM

4 TRUST FUND’’. 

5 (e) CLERICAL AMENDMENTS.—The table of contents 

6 of subtitle A of title XI of such Act is amended— 

7 (1) by adding at the end of the items relating 

8 to chapter 4 the following: 

‘‘Sec. 11036. Termination of Trust Fund.’’; 

9 (2) by adding at the end of the items relating 

10 to chapter 6 the following: 

‘‘Sec. 11056. Termination of Federal Supplemental Fund.’’; 

11 (3) by redesignating the item relating to chap12 ter 9 as relating to chapter 10; 

13 (4) by redesignating the items relating to sec14 tions 11081 through 11087 as relating to sections 

15 11091 through 11097; and 

16 (5) by inserting after the items relating to 

17 chapter 8 the following: 

‘‘CHAPTER 9—DISTRICT OF COLUMBIA FEDERAL PENSION FUND

‘‘Sec. 11081. Creation of Fund. 

‘‘Sec. 11082. Uses of Amounts in Fund. 

‘‘Sec. 11083. Transfer of Assets and Obligations of Trust Fund and Federal 

Supplemental Fund. 

‘‘Sec. 11084. Determination of Annual Federal Payment Into D.C. Federal 

Pension Fund. 

‘‘Sec. 11085. Administration Through Pension Fund Trustee. 

‘‘Sec. 11086. Applicability of Other Provisions to D.C. Federal Pension Fund.’’. 
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1 SEC. 3. ADMINISTRATION OF DISTRICT OF COLUMBIA JUDI2 CIAL RETIREMENT AND SURVIVORS ANNUITY 

3 FUND. 

4 (a) PROCEDURES FOR RESOLVING DENIED BENEFIT

5 CLAIMS.— 

6 (1) IN GENERAL.—Section 11–1570(c), D.C. 

7 Official Code, is amended by adding at the end the 

8 following new paragraph: 

9 ‘‘(3)(A) In accordance with procedures ap10 proved by the Secretary, the Secretary shall provide 

11 to any individual whose claim for a benefit under 

12 this subchapter has been denied in whole or in 

13 part— 

14 ‘‘(i) adequate written notice of such denial, 

15 setting forth the specific reasons for the denial 

16 in a manner calculated to be understood by the 

17 average participant in the program of benefits 

18 under this subchapter; and 

19 ‘‘(ii) a reasonable opportunity for a full 

20 and fair review of the decision denying such 

21 claim. 

22 ‘‘(B) Any factual determination made by the 

23 Secretary pursuant to this paragraph shall be pre24 sumed correct unless rebutted by clear and con25 vincing evidence. The Secretary’s interpretation and 
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1 construction of the benefit provisions of this sub2 chapter shall be entitled to great deference.’’. 

3 (2) EFFECTIVE DATE.—The amendment made 

4 by paragraph (1) shall apply with respect to claims 

5 for benefits which are made after the date of the en6 actment of this Act. 

7 (b) TREATMENT OF MISAPPROPRIATION OF FUND

8 AMOUNTS AS FEDERAL CRIME.— 

9 (1) IN GENERAL.—Section 11–1570, D.C. Offi10 cial Code, is amended by adding at the end the fol11 lowing new subsection: 

12 ‘‘(l) The provisions of section 664 of title 18, United 

13 States Code (relating to theft or embezzlement from em14 ployee benefit plans), shall apply to the Fund.’’. 

15 (2) EFFECTIVE DATE.—The amendment made 

16 by paragraph (1) shall take effect on the date of the 

17 enactment of this Act. 

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