H. R. 4040—2
‘‘(3) MEMBER
OF
THE
UNIFORMED
SERVICES.—The term
‘member of the uniformed services’ means a member of the
uniformed services, other than a retired member of the uni-
formed services, who is—
‘‘(A) on active duty or full-time National Guard duty
for a period of more than 30 days; and
‘‘(B) a member of the Selected Reserve.
‘‘(4) RETIRED MEMBER OF THE UNIFORMED SERVICES.—The
term ‘retired member of the uniformed services’ means a
member or former member of the uniformed services entitled
to retired or retainer pay, including a member or former
member retired under chapter 1223 of title 10 who has attained
the age of 60 and who satisfies such eligibility requirements
as the Office of Personnel Management prescribes under section
9008.
‘‘(5) QUALIFIED
RELATIVE.—The term ‘qualified relative’
means each of the following:
‘‘(A) The spouse of an individual described in paragraph
(1), (2), (3), or (4).
‘‘(B) A parent, stepparent, or parent-in-law of an indi-
vidual described in paragraph (1) or (3).
‘‘(C) A child (including an adopted child, a stepchild,
or, to the extent the Office of Personnel Management by
regulation provides, a foster child) of an individual
described in paragraph (1), (2), (3), or (4), if such child
is at least 18 years of age.
‘‘(D) An individual having such other relationship to
an individual described in paragraph (1), (2), (3), or (4)
as the Office may by regulation prescribe.
‘‘(6) ELIGIBLE INDIVIDUAL.—The term ‘eligible individual’
refers to an individual described in paragraph (1), (2), (3),
(4), or (5).
‘‘(7) QUALIFIED
CARRIER.—The term ‘qualified carrier’
means an insurance company (or consortium of insurance
companies) that is licensed to issue long-term care insurance
in all States, taking any subsidiaries of such a company into
account (and, in the case of a consortium, considering the
member companies and any subsidiaries thereof, collectively).
‘‘(8) STATE.—The term ‘State’ includes the District of
Columbia.
‘‘(9) QUALIFIED LONG-TERM CARE INSURANCE CONTRACT.—
The term ‘qualified long-term care insurance contract’ has the
meaning given such term by section 7702B of the Internal
Revenue Code of 1986.
‘‘(10) APPROPRIATE SECRETARY.—The term ‘appropriate Sec-
retary’ means—
‘‘(A) except as otherwise provided in this paragraph,
the Secretary of Defense;
‘‘(B) with respect to the Coast Guard when it is not
operating as a service of the Navy, the Secretary of
Transportation;
‘‘(C) with respect to the commissioned corps of the
National Oceanic and Atmospheric Administration, the Sec-
retary of Commerce; and
‘‘(D) with respect to the commissioned corps of the
Public Health Service, the Secretary of Health and Human
Services.
H. R. 4040—3
‘‘§ 9002. Availability of insurance
‘‘(a) IN GENERAL.—The Office of Personnel Management shall
establish and, in consultation with the appropriate Secretaries,
administer a program through which an individual described in
paragraph (1), (2), (3), (4), or (5) of section 9001 may obtain long-
term care insurance coverage under this chapter for such individual.
‘‘(b) GENERAL REQUIREMENTS.—Long-term care insurance may
not be offered under this chapter unless—
‘‘(1) the only coverage provided is under qualified long-
term care insurance contracts; and
‘‘(2) each insurance contract under which any such coverage
is provided is issued by a qualified carrier.
‘‘(c) DOCUMENTATION
REQUIREMENT.—As a condition for
obtaining long-term care insurance coverage under this chapter
based on one’s status as a qualified relative, an applicant shall
provide documentation to demonstrate the relationship, as pre-
scribed by the Office.
‘‘(d) UNDERWRITING STANDARDS.—
‘‘(1) DISQUALIFYING CONDITION.—Nothing in this chapter
shall be considered to require that long-term care insurance
coverage be made available in the case of any individual who
would be eligible for benefits immediately.
‘‘(2) SPOUSAL
PARITY.—For the purpose of underwriting
standards, a spouse of an individual described in paragraph
(1), (2), (3), or (4) of section 9001 shall, as nearly as practicable,
be treated like that individual.
‘‘(3) GUARANTEED
ISSUE.—Nothing in this chapter shall
be considered to require that long-term care insurance coverage
be guaranteed to an eligible individual.
‘‘(4) REQUIREMENT THAT CONTRACT BE FULLY INSURED.—
In addition to the requirements otherwise applicable under
section 9001(9), in order to be considered a qualified long-
term care insurance contract for purposes of this chapter, a
contract must be fully insured, whether through reinsurance
with other companies or otherwise.
‘‘(5) HIGHER
STANDARDS
ALLOWABLE.—Nothing in this
chapter shall, in the case of an individual applying for long-
term care insurance coverage under this chapter after the
expiration of such individual’s first opportunity to enroll, pre-
clude the application of underwriting standards more stringent
than those that would have applied if that opportunity had
not yet expired.
‘‘(e) GUARANTEED RENEWABILITY.—The benefits and coverage
made available to eligible individuals under any insurance contract
under this chapter shall be guaranteed renewable (as defined by
section 7A(2) of the model regulations described in section
7702B(g)(2) of the Internal Revenue Code of 1986), including the
right to have insurance remain in effect so long as premiums
continue to be timely made. However, the authority to revise pre-
miums under this chapter shall be available only on a class basis
and only to the extent otherwise allowable under section 9003(b).
‘‘§ 9003. Contracting authority
‘‘(a) IN GENERAL.—The Office of Personnel Management shall,
without regard to section 5 of title 41 or any other statute requiring
competitive bidding, contract with one or more qualified carriers
for a policy or policies of long-term care insurance. The Office
H. R. 4040—4
shall ensure that each resulting contract (hereafter in this chapter
referred to as a ‘master contract’) is awarded on the basis of con-
tractor qualifications, price, and reasonable competition.
‘‘(b) TERMS AND CONDITIONS.—
‘‘(1) IN GENERAL.—Each master contract under this chapter
shall contain—
‘‘(A) a detailed statement of the benefits offered
(including any maximums, limitations, exclusions, and
other definitions of benefits);
‘‘(B) the premiums charged (including any limitations
or other conditions on their subsequent adjustment);
‘‘(C) the terms of the enrollment period; and
‘‘(D) such other terms and conditions as may be mutu-
ally agreed to by the Office and the carrier involved, con-
sistent with the requirements of this chapter.
‘‘(2) PREMIUMS.—Premiums charged under each master con-
tract entered into under this section shall reasonably and equi-
tably reflect the cost of the benefits provided, as determined
by the Office. The premiums shall not be adjusted during
the term of the contract unless mutually agreed to by the
Office and the carrier.
‘‘(3) NONRENEWABILITY.—Master contracts under this
chapter may not be made automatically renewable.
‘‘(c) PAYMENT OF REQUIRED BENEFITS; DISPUTE RESOLUTION.—
‘‘(1) IN GENERAL.—Each master contract under this chapter
shall require the carrier to agree—
‘‘(A) to provide payments or benefits to an eligible
individual if such individual is entitled thereto under the
terms of the contract; and
‘‘(B) with respect to disputes regarding claims for pay-
ments or benefits under the terms of the contract—
‘‘(i) to establish internal procedures designed to
expeditiously resolve such disputes; and
‘‘(ii) to establish, for disputes not resolved through
procedures under clause (i), procedures for one or more
alternative means of dispute resolution involving inde-
pendent third-party review under appropriate cir-
cumstances by entities mutually acceptable to the
Office and the carrier.
‘‘(2) ELIGIBILITY.—A carrier’s determination as to whether
or not a particular individual is eligible to obtain long-term
care insurance coverage under this chapter shall be subject
to review only to the extent and in the manner provided in
the applicable master contract.
‘‘(3) OTHER CLAIMS.—For purposes of applying the Contract
Disputes Act of 1978 to disputes arising under this chapter
between a carrier and the Office—
‘‘(A) the agency board having jurisdiction to decide
an appeal relative to such a dispute shall be such board
of contract appeals as the Director of the Office of Personnel
Management shall specify in writing (after appropriate
arrangements, as described in section 8(c) of such Act);
and
‘‘(B) the district courts of the United States shall have
original jurisdiction, concurrent with the United States
Court of Federal Claims, of any action described in section
10(a)(1) of such Act relative to such a dispute.
H. R. 4040—5
‘‘(4) RULE OF CONSTRUCTION.—Nothing in this chapter shall
be considered to grant authority for the Office or a third-
party reviewer to change the terms of any contract under
this chapter.
‘‘(d) DURATION.—
‘‘(1) IN GENERAL.—Each master contract under this chapter
shall be for a term of 7 years, unless terminated earlier by
the Office in accordance with the terms of such contract. How-
ever, the rights and responsibilities of the enrolled individual,
the insurer, and the Office (or duly designated third-party
administrator) under such contract shall continue with respect
to such individual until the termination of coverage of the
enrolled individual or the effective date of a successor contract
thereto.
‘‘(2) EXCEPTION.—
‘‘(A) SHORTER DURATION.—In the case of a master con-
tract entered into before the end of the period described
in subparagraph (B), paragraph (1) shall be applied by
substituting ‘ending on the last day of the 7-year period
described in paragraph (2)(B)’ for ‘of 7 years’.
‘‘(B) 
DEFINITION.—The 
period 
described 
in 
this
subparagraph is the 7-year period beginning on the earliest
date as of which any long-term care insurance coverage
under this chapter becomes effective.
‘‘(3) CONGRESSIONAL
NOTIFICATION.—No later than 180
days after receiving the second report required under section
9006(c), the President (or his designee) shall submit to the
Committees on Government Reform and on Armed Services
of the House of Representatives and the Committees on Govern-
mental Affairs and on Armed Services of the Senate, a written
recommendation as to whether the program under this chapter
should be continued without modification, terminated, or
restructured. During the 180-day period following the date
on which the President (or his designee) submits the rec-
ommendation required under the preceding sentence, the Office
of Personnel Management may not take any steps to rebid
or otherwise contract for any coverage to be available at any
time following the expiration of the 7-year period described
in paragraph (2)(B).
‘‘(4) FULL PORTABILITY.—Each master contract under this
chapter shall include such provisions as may be necessary
to ensure that, once an individual becomes duly enrolled, long-
term care insurance coverage obtained by such individual
pursuant to that enrollment shall not be terminated due to
any change in status (such as separation from Government
service or the uniformed services) or ceasing to meet the
requirements for being considered a qualified relative (whether
as a result of dissolution of marriage or otherwise).
‘‘§ 9004. Financing
‘‘(a) IN GENERAL.—Each eligible individual obtaining long-term
care insurance coverage under this chapter shall be responsible
for 100 percent of the premiums for such coverage.
‘‘(b) WITHHOLDINGS.—
‘‘(1) IN GENERAL.—The amount necessary to pay the pre-
miums for enrollment may—
H. R. 4040—6
‘‘(A) in the case of an employee, be withheld from
the pay of such employee;
‘‘(B) in the case of an annuitant, be withheld from
the annuity of such annuitant;
‘‘(C) in the case of a member of the uniformed services
described in section 9001(3), be withheld from the pay
of such member; and
‘‘(D) in the case of a retired member of the uniformed
services described in section 9001(4), be withheld from
the retired pay or retainer pay payable to such member.
‘‘(2) VOLUNTARY
WITHHOLDINGS
FOR
QUALIFIED
REL-
ATIVES.—Withholdings to pay the premiums for enrollment of
a qualified relative may, upon election of the appropriate
eligible individual (described in section 9001(1)–(4)), be with-
held under paragraph (1) to the same extent and in the same
manner as if enrollment were for such individual.
‘‘(c) DIRECT PAYMENTS.—All amounts withheld under this sec-
tion shall be paid directly to the carrier.
‘‘(d) OTHER FORMS OF PAYMENT.—Any enrollee who does not
elect to have premiums withheld under subsection (b) or whose
pay, annuity, or retired or retainer pay (as referred to in subsection
(b)(1)) is insufficient to cover the withholding required for enroll-
ment (or who is not receiving any regular amounts from the Govern-
ment, as referred to in subsection (b)(1), from which any such
withholdings may be made, and whose premiums are not otherwise
being provided for under subsection (b)(2)) shall pay an amount
equal to the full amount of those charges directly to the carrier.
‘‘(e) 
SEPARATE
ACCOUNTING
REQUIREMENT.—Each 
carrier
participating under this chapter shall maintain records that permit
it to account for all amounts received under this chapter (including
investment earnings on those amounts) separate and apart from
all other funds.
‘‘(f ) REIMBURSEMENTS.—
‘‘(1) REASONABLE INITIAL COSTS.—
‘‘(A) IN GENERAL.—The Employees’ Life Insurance Fund
is available, without fiscal year limitation, for reasonable
expenses incurred by the Office of Personnel Management
in administering this chapter before the start of the 7-
year period described in section 9003(d)(2)(B), including
reasonable implementation costs.
‘‘(B) REIMBURSEMENT REQUIREMENT.—Such Fund shall
be reimbursed, before the end of the first year of that
7-year period, for all amounts obligated or expended under
subparagraph (A) (including lost investment income). Such
reimbursement shall be made by carriers, on a pro rata
basis, in accordance with appropriate provisions which
shall be included in master contracts under this chapter.
‘‘(2) SUBSEQUENT COSTS.—
‘‘(A) IN GENERAL.—There is hereby established in the
Employees’ Life Insurance Fund a Long-Term Care
Administrative Account, which shall be available to the
Office, without fiscal year limitation, to defray reasonable
expenses incurred by the Office in administering this
chapter after the start of the 7-year period described in
section 9003(d)(2)(B).
H. R. 4040—7
‘‘(B) REIMBURSEMENT
REQUIREMENT.—Each master
contract under this chapter shall include appropriate provi-
sions under which the carrier involved shall, during each
year, make such periodic contributions to the Long-Term
Care Administrative Account as necessary to ensure that
the reasonable anticipated expenses of the Office in admin-
istering this chapter during such year (adjusted to reconcile
for any earlier overestimates or underestimates under this
subparagraph) are defrayed.
‘‘§ 9005. Preemption
‘‘The terms of any contract under this chapter which relate
to the nature, provision, or extent of coverage or benefits (including
payments with respect to benefits) shall supersede and preempt
any State or local law, or any regulation issued thereunder, which
relates to long-term care insurance or contracts.
‘‘§ 9006. Studies, reports, and audits
‘‘(a) PROVISIONS RELATING TO CARRIERS.—Each master contract
under this chapter shall contain provisions requiring the carrier—
‘‘(1) to furnish such reasonable reports as the Office of
Personnel Management determines to be necessary to enable
it to carry out its functions under this chapter; and
‘‘(2) to permit the Office and representatives of the General
Accounting Office to examine such records of the carrier as
may be necessary to carry out the purposes of this chapter.
‘‘(b) PROVISIONS RELATING TO FEDERAL AGENCIES.—Each Fed-
eral agency shall keep such records, make such certifications, and
furnish the Office, the carrier, or both, with such information and
reports as the Office may require.
‘‘(c) REPORTS BY THE GENERAL ACCOUNTING OFFICE.—The Gen-
eral Accounting Office shall prepare and submit to the President,
the Office of Personnel Management, and each House of Congress,
before the end of the third and fifth years during which the program
under this chapter is in effect, a written report evaluating such
program. Each such report shall include an analysis of the competi-
tiveness of the program, as compared to both group and individual
coverage generally available to individuals in the private insurance
market. The Office shall cooperate with the General Accounting
Office to provide periodic evaluations of the program.
‘‘§ 9007. Jurisdiction of courts
‘‘The district courts of the United States have original jurisdic-
tion of a civil action or claim described in paragraph (1) or (2)
of section 9003(c), after such administrative remedies as required
under such paragraph (1) or (2) (as applicable) have been exhausted,
but only to the extent judicial review is not precluded by any
dispute resolution or other remedy under this chapter.
‘‘§ 9008. Administrative functions
‘‘(a) IN GENERAL.—The Office of Personnel Management shall
prescribe regulations necessary to carry out this chapter.
‘‘(b) ENROLLMENT PERIODS.—The Office shall provide for peri-
odic coordinated enrollment, promotion, and education efforts in
consultation with the carriers.
‘‘(c) CONSULTATION.—Any regulations necessary to effect the
application and operation of this chapter with respect to an eligible
H. R. 4040—8
individual described in paragraph (3) or (4) of section 9001, or
a qualified relative thereof, shall be prescribed by the Office in
consultation with the appropriate Secretary.
‘‘(d) INFORMED DECISIONMAKING.—The Office shall ensure that
each eligible individual applying for long-term care insurance under
this chapter is furnished the information necessary to enable that
individual to evaluate the advantages and disadvantages of
obtaining long-term care insurance under this chapter, including
the following:
‘‘(1) The principal long-term care benefits and coverage
available under this chapter, and how those benefits and cov-
erage compare to the range of long-term care benefits and
coverage otherwise generally available.
‘‘(2) Representative examples of the cost of long-term care,
and the sufficiency of the benefits available under this chapter
relative to those costs. The information under this paragraph
shall also include—
‘‘(A) the projected effect of inflation on the value of
those benefits; and
‘‘(B) a comparison of the inflation-adjusted value of
those benefits to the projected future costs of long-term
care.
‘‘(3) Any rights individuals under this chapter may have
to cancel coverage, and to receive a total or partial refund
of premiums. The information under this paragraph shall also
include—
‘‘(A) the projected number or percentage of individuals
likely to fail to maintain their coverage (determined based
on lapse rates experienced under similar group long-term
care insurance programs and, when available, this chapter);
and
‘‘(B)(i) a summary description of how and when pre-
miums for long-term care insurance under this chapter
may be raised;
‘‘(ii) the premium history during the last 10 years
for each qualified carrier offering long-term care insurance
under this chapter; and
‘‘(iii) if cost increases are anticipated, the projected
premiums for a typical insured individual at various ages.
‘‘(4) The advantages and disadvantages of long-term care
insurance generally, relative to other means of accumulating
or otherwise acquiring the assets that may be needed to meet
the costs of long-term care, such as through tax-qualified retire-
ment programs or other investment vehicles.
‘‘§ 9009. Cost accounting standards
‘‘The cost accounting standards issued pursuant to section 26(f )
of the Office of Federal Procurement Policy Act (41 U.S.C. 422(f ))
shall not apply with respect to a long-term care insurance contract
under this chapter.’’.
(b) CONFORMING AMENDMENT.—The analysis for part III of
title 5, United States Code, is amended by adding at the end
of subpart G the following:
‘‘90. Long-Term Care Insurance .....................................................................
9001.’’.
H. R. 4040—9
SEC. 1003. EFFECTIVE DATE.
The Office of Personnel Management shall take such measures
as may be necessary to ensure that long-term care insurance cov-
erage under title 5, United States Code, as amended by this title,
may be obtained in time to take effect not later than the first
day of the first applicable pay period of the first fiscal year which
begins after the end of the 18-month period beginning on the
date of the enactment of this Act.
TITLE II—FEDERAL RETIREMENT
COVERAGE ERRORS CORRECTION
SEC. 2001. SHORT TITLE; TABLE OF CONTENTS.
(a) SHORT TITLE.—This title may be cited as the ‘‘Federal
Erroneous Retirement Coverage Corrections Act’’.
(b) TABLE OF CONTENTS.—The table of contents for this title
is as follows:
TITLE II—FEDERAL RETIREMENT COVERAGE ERRORS CORRECTION
Sec. 2001. Short title; table of contents.
Sec. 2002. Definitions.
Sec. 2003. Applicability.
Sec. 2004. Irrevocability of elections.
Subtitle A—Description of Retirement Coverage Errors to Which This Title Applies
and Measures for Their Rectification
CHAPTER 1—EMPLOYEES AND ANNUITANTS WHO SHOULD HAVE BEEN FERS COV-
ERED, BUT WHO WERE ERRONEOUSLY CSRS COVERED OR CSRS-OFFSET COVERED
INSTEAD, AND SURVIVORS OF SUCH EMPLOYEES AND ANNUITANTS
Sec. 2101. Employees.
Sec. 2102. Annuitants and survivors.
CHAPTER 2—EMPLOYEE WHO SHOULD HAVE BEEN FERS COVERED, CSRS-OFFSET
COVERED, OR CSRS COVERED, BUT WHO WAS ERRONEOUSLY SOCIAL SECURITY-
ONLY COVERED INSTEAD
Sec. 2111. Applicability.
Sec. 2112. Correction mandatory.
CHAPTER 3—EMPLOYEE WHO SHOULD OR COULD HAVE BEEN SOCIAL SECURITY-ONLY
COVERED BUT WHO WAS ERRONEOUSLY CSRS-OFFSET COVERED OR CSRS COV-
ERED INSTEAD
Sec. 2121. Employee who should be Social Security-Only covered, but who is erro-
neously CSRS or CSRS-Offset covered instead.
CHAPTER 4—EMPLOYEE WHO WAS ERRONEOUSLY FERS COVERED
Sec. 2131. Employee who should be Social Security-Only covered, CSRS covered, or
CSRS-Offset covered and is not FERS-Eligible, but who is erroneously
FERS covered instead.
Sec. 2132. FERS-Eligible employee who should have been CSRS covered, CSRS-Off-
set covered, or Social Security-Only covered, but who was erroneously
FERS covered instead without an election.
Sec. 2133. Retroactive effect.
CHAPTER 5—EMPLOYEE WHO SHOULD HAVE BEEN CSRS-OFFSET COVERED, BUT
WHO WAS ERRONEOUSLY CSRS COVERED INSTEAD
Sec. 2141. Applicability.
Sec. 2142. Correction mandatory.
CHAPTER 6—EMPLOYEE WHO SHOULD HAVE BEEN CSRS COVERED, BUT WHO WAS
ERRONEOUSLY CSRS-OFFSET COVERED INSTEAD
Sec. 2151. Applicability.
H. R. 4040—10
Sec. 2152. Correction mandatory.
Subtitle B—General Provisions
Sec. 2201. Identification and notification requirements.
Sec. 2202. Information to be furnished to and by authorities administering this
title.
Sec. 2203. Service credit deposits.
Sec. 2204. Provisions related to Social Security coverage of misclassified employees.
Sec. 2205. Thrift Savings Plan treatment for certain individuals.
Sec. 2206. Certain agency amounts to be paid into or remain in the CSRDF.
Sec. 2207. CSRS coverage determinations to be approved by OPM.
Sec. 2208. Discretionary actions by Director.
Sec. 2209. Regulations.
Subtitle C—Other Provisions
Sec. 2301. Provisions to authorize continued conformity of other Federal retirement
systems.
Sec. 2302. Authorization of payments.
Sec. 2303. Individual right of action preserved for amounts not otherwise provided
for under this title.
Subtitle D—Effective Date
Sec. 2401. Effective date.
SEC. 2002. DEFINITIONS.
For purposes of this title:
(1) ANNUITANT.—The term ‘‘annuitant’’ has the meaning
given such term under section 8331(9) or 8401(2) of title 5,
United States Code.
(2) CSRS.—The term ‘‘CSRS’’ means the Civil Service
Retirement System.
(3) CSRDF.—The term ‘‘CSRDF’’ means the Civil Service
Retirement and Disability Fund.
(4) CSRS COVERED.—The term ‘‘CSRS covered’’, with
respect to any service, means service that is subject to the
provisions of subchapter III of chapter 83 of title 5, United
States Code, other than service subject to section 8334(k) of
such title.
(5) CSRS-OFFSET COVERED.—The term ‘‘CSRS-Offset cov-
ered’’, with respect to any service, means service that is subject
to the provisions of subchapter III of chapter 83 of title 5,
United States Code, and to section 8334(k) of such title.
(6) EMPLOYEE.—The term ‘‘employee’’ has the meaning
given such term under section 8331(1) or 8401(11) of title
5, United States Code.
(7) EXECUTIVE DIRECTOR.—The term ‘‘Executive Director
of the Federal Retirement Thrift Investment Board’’ or ‘‘Execu-
tive Director’’ means the Executive Director appointed under
section 8474 of title 5, United States Code.
(8) 
FERS.—The 
term 
‘‘FERS’’ 
means 
the 
Federal
Employees’ Retirement System.
(9) FERS COVERED.—The term ‘‘FERS covered’’, with
respect to any service, means service that is subject to chapter
84 of title 5, United States Code.
(10) FORMER
EMPLOYEE.—The term ‘‘former employee’’
means an individual who was an employee, but who is not
an annuitant.
(11) OASDI TAXES.—The term ‘‘OASDI taxes’’ means the
OASDI employee tax and the OASDI employer tax.
(12) OASDI EMPLOYEE TAX.—The term ‘‘OASDI employee
tax’’ means the tax imposed under section 3101(a) of the
H. R. 4040—11
Internal Revenue Code of 1986 (relating to Old-Age, Survivors
and Disability Insurance).
(13) OASDI EMPLOYER TAX.—The term ‘‘OASDI employer
tax’’ means the tax imposed under section 3111(a) of the
Internal Revenue Code of 1986 (relating to Old-Age, Survivors
and Disability Insurance).
(14) OASDI TRUST FUNDS.—The term ‘‘OASDI trust funds’’
means the Federal Old-Age and Survivors Insurance Trust
Fund and the Federal Disability Insurance Trust Fund.
(15) OFFICE.—The term ‘‘Office’’ means the Office of Per-
sonnel Management.
(16) RETIREMENT
COVERAGE
DETERMINATION.—The term
‘‘retirement coverage determination’’ means a determination
by an employee or agent of the Government as to whether
a particular type of Government service is CSRS covered, CSRS-
Offset covered, FERS covered, or Social Security-Only covered.
(17) RETIREMENT COVERAGE ERROR.—The term ‘‘retirement
coverage error’’ means an erroneous retirement coverage deter-
mination that was in effect for a minimum period of 3 years
of service after December 31, 1986.
(18) SOCIAL
SECURITY-ONLY
COVERED.—The term ‘‘Social
Security-Only covered’’, with respect to any service, means
Government service that—
(A) constitutes employment under section 210 of the
Social Security Act (42 U.S.C. 410); and
(B)(i) is subject to OASDI taxes; but
(ii) is not subject to CSRS or FERS.
(19) SURVIVOR.—The term ‘‘survivor’’ has the meaning
given such term under section 8331(10) or 8401(28) of title
5, United States Code.
(20) THRIFT
SAVINGS
FUND.—The term ‘‘Thrift Savings
Fund’’ means the Thrift Savings Fund established under section
8437 of title 5, United States Code.
SEC. 2003. APPLICABILITY.
(a) IN GENERAL.—This title shall apply with respect to retire-
ment coverage errors that occur before, on, or after the date of
the enactment of this Act.
(b) LIMITATION.—Except as otherwise provided in this title,
this title shall not apply to any erroneous retirement coverage
determination that was in effect for a period of less than 3 years
of service after December 31, 1986.
SEC. 2004. IRREVOCABILITY OF ELECTIONS.
Any election made (or deemed to have been made) by an
employee or any other individual under this title shall be irrev-
ocable.
H. R. 4040—12
Subtitle A—Description of Retirement Cov-
erage Errors to Which This Title Applies
and Measures for Their Rectification
CHAPTER 
1—EMPLOYEES 
AND 
ANNUITANTS 
WHO
SHOULD HAVE BEEN FERS COVERED, BUT WHO WERE
ERRONEOUSLY CSRS COVERED OR CSRS-OFFSET COV-
ERED INSTEAD, AND SURVIVORS OF SUCH EMPLOY-
EES AND ANNUITANTS
SEC. 2101. EMPLOYEES.
(a) APPLICABILITY.—This section shall apply in the case of any
employee or former employee who should be (or should have been)
FERS covered but, as a result of a retirement coverage error,
is (or was) CSRS covered or CSRS-Offset covered instead.
(b) UNCORRECTED ERROR.—
(1) APPLICABILITY.—This subsection applies if the retire-
ment coverage error has not been corrected before the effective
date of the regulations described under paragraph (3). As soon
as practicable after discovery of the error, and subject to the
right of an election under paragraph (2), if CSRS covered or
CSRS-Offset covered, such individual shall be treated as CSRS-
Offset covered, retroactive to the date of the retirement coverage
error.
(2) COVERAGE.—
(A) ELECTION.—Upon written notice of a retirement
coverage error, an individual may elect to be CSRS-Offset
covered or FERS covered, effective as of the date of the
retirement coverage error. Such election shall be made
not later than 180 days after the date of receipt of such
notice.
(B) NONELECTION.—If the individual does not make
an election by the date provided under subparagraph (A),
a CSRS-Offset covered individual shall remain CSRS-Offset
covered and a CSRS covered individual shall be treated
as CSRS-Offset covered.
(3) REGULATIONS.—The Office shall prescribe regulations
to carry out this subsection.
(c) CORRECTED ERROR.—
(1) APPLICABILITY.—This subsection applies if the retire-
ment coverage error was corrected before the effective date
of the regulations described under subsection (b).
(2) COVERAGE.—
(A) ELECTION.—
(i) CSRS-OFFSET
COVERED.—Not later than 180
days after the date of the enactment of this Act, the
Office shall prescribe regulations authorizing individ-
uals to elect, during the 18-month period immediately
following the effective date of such regulations, to be
CSRS-Offset covered, effective as of the date of the
retirement coverage error.
(ii) THRIFT
SAVINGS
FUND
CONTRIBUTIONS.—If
under this section an individual elects to be CSRS-
Offset covered, all employee contributions to the Thrift
H. R. 4040—13
Savings Fund made during the period of FERS cov-
erage (and earnings on such contributions) may remain
in the Thrift Savings Fund in accordance with regula-
tions prescribed by the Executive Director, notwith-
standing any limit under title 5, United States Code,
that would otherwise be applicable.
(B) PREVIOUS
SETTLEMENT
PAYMENT.—An individual
who previously received a payment ordered by a court
or provided as a settlement of claim for losses resulting
from a retirement coverage error shall not be entitled to
make an election under this subsection unless that amount
is waived in whole or in part under section 2208, and
any amount not waived is repaid.
(C) INELIGIBILITY FOR ELECTION.—An individual who,
subsequent to correction of the retirement coverage error,
received a refund of retirement deductions under section
8424 of title 5, United States Code, or a distribution under
section 8433(b), (c), or (h)(1)(A) of title 5, United States
Code, may not make an election under this subsection.
(3) CORRECTIVE ACTION TO REMAIN IN EFFECT.—If an indi-
vidual is ineligible to make an election or does not make an
election under paragraph (2) before the end of any time limita-
tion under this subsection, the corrective action taken before
such time limitation shall remain in effect.
SEC. 2102. ANNUITANTS AND SURVIVORS.
(a) IN GENERAL.—This section shall apply in the case of an
individual who is—
(1) an annuitant who should have been FERS covered
but, as a result of a retirement coverage error, was CSRS
covered or CSRS-Offset covered instead; or
(2) a survivor of an employee who should have been FERS
covered but, as a result of a retirement coverage error, was
CSRS covered or CSRS-Offset covered instead.
(b) COVERAGE.—
(1) ELECTION.—Not later than 180 days after the date
of the enactment of this Act, the Office shall prescribe regula-
tions authorizing an individual described under subsection (a)
to elect CSRS-Offset coverage or FERS coverage, effective as
of the date of the retirement coverage error.
(2) TIME LIMITATION.—An election under this subsection
shall be made not later than 18 months after the effective
date of the regulations prescribed under paragraph (1).
(3) REDUCED ANNUITY.—
(A) AMOUNT
IN
ACCOUNT.—If the individual elects
CSRS-Offset coverage, the amount in the employee’s Thrift
Savings Fund account under subchapter III of chapter 84
of title 5, United States Code, on the date of retirement
that represents the Government’s contributions and
earnings on those contributions (whether or not such
amount was subsequently distributed from the Thrift
Savings Fund) will form the basis for a reduction in the
individual’s annuity, under regulations prescribed by the
Office.
(B) REDUCTION.—The reduced annuity to which the
individual is entitled shall be equal to an amount which,
when taken together with the amount referred to in
H. R. 4040—14
subparagraph (A), would result in the present value of
the total being actuarially equivalent to the present value
of an unreduced CSRS-Offset annuity that would have
been provided the individual.
(4) REDUCED BENEFIT.—If—
(A) a surviving spouse elects CSRS-Offset benefits; and
(B) a FERS basic employee death benefit under section
8442(b) of title 5, United States Code, was previously paid,
then the survivor’s CSRS-Offset benefit shall be subject to
a reduction, under regulations prescribed by the Office. The
reduced annuity to which the individual is entitled shall be
equal to an amount which, when taken together with the
amount of the payment referred to under subparagraph (B)
would result in the present value of the total being actuarially
equivalent to the present value of an unreduced CSRS-Offset
annuity that would have been provided the individual.
(5) PREVIOUS SETTLEMENT PAYMENT.—An individual who
previously received a payment ordered by a court or provided
as a settlement of claim for losses resulting from a retirement
coverage error may not make an election under this subsection
unless repayment of that amount is waived in whole or in
part under section 2208, and any amount not waived is repaid.
(c) NONELECTION.—If the individual does not make an election
under subsection (b) before any time limitation under this section,
the retirement coverage shall be subject to the following rules:
(1) CORRECTIVE ACTION PREVIOUSLY TAKEN.—If corrective
action was taken before the end of any time limitation under
this section, that corrective action shall remain in effect.
(2) CORRECTIVE ACTION NOT PREVIOUSLY TAKEN.—If correc-
tive action was not taken before such time limitation, the
employee shall be CSRS-Offset covered, retroactive to the date
of the retirement coverage error.
CHAPTER 2—EMPLOYEE WHO SHOULD HAVE BEEN
FERS COVERED, CSRS-OFFSET COVERED, OR CSRS
COVERED, BUT WHO WAS ERRONEOUSLY SOCIAL SE-
CURITY-ONLY COVERED INSTEAD
SEC. 2111. APPLICABILITY.
This chapter shall apply in the case of any employee who—
(1) should be (or should have been) FERS covered but,
as a result of a retirement coverage error, is (or was) Social
Security-Only covered instead;
(2) should be (or should have been) CSRS-Offset covered
but, as a result of a retirement coverage error, is (or was)
Social Security-Only covered instead; or
(3) should be (or should have been) CSRS covered but,
as a result of a retirement coverage error, is (or was) Social
Security-Only covered instead.
SEC. 2112. CORRECTION MANDATORY.
(a) UNCORRECTED ERROR.—If the retirement coverage error
has not been corrected, as soon as practicable after discovery of
the error, such individual shall be covered under the correct retire-
ment coverage, effective as of the date of the retirement coverage
error.
H. R. 4040—15
(b) CORRECTED ERROR.—If the retirement coverage error has
been corrected, the corrective action previously taken shall remain
in effect.
CHAPTER 3—EMPLOYEE WHO SHOULD OR COULD HAVE
BEEN SOCIAL SECURITY-ONLY COVERED BUT WHO
WAS ERRONEOUSLY CSRS-OFFSET COVERED OR CSRS
COVERED INSTEAD
SEC. 2121. EMPLOYEE WHO SHOULD BE SOCIAL SECURITY-ONLY COV-
ERED, BUT WHO IS ERRONEOUSLY CSRS OR CSRS-OFFSET
COVERED INSTEAD.
(a) APPLICABILITY.—This section applies in the case of a retire-
ment coverage error in which a Social Security-Only covered
employee was erroneously CSRS covered or CSRS-Offset covered.
(b) UNCORRECTED ERROR.—
(1) APPLICABILITY.—This subsection applies if the retire-
ment coverage error has not been corrected before the effective
date of the regulations described in paragraph (3).
(2) COVERAGE.—In the case of an individual who is erro-
neously CSRS covered, as soon as practicable after discovery
of the error, and subject to the right of an election under
paragraph (3), such individual shall be CSRS-Offset covered,
effective as of the date of the retirement coverage error.
(3) ELECTION.—
(A) IN GENERAL.—Upon written notice of a retirement
coverage error, an individual may elect to be CSRS-Offset
covered or Social Security-Only covered, effective as of the
date of the retirement coverage error. Such election shall
be made not later than 180 days after the date of receipt
of such notice.
(B) NONELECTION.—If the individual does not make
an election before the date provided under subparagraph
(A), the individual shall remain CSRS-Offset covered.
(C) REGULATIONS.—The Office shall prescribe regula-
tions to carry out this paragraph.
(c) CORRECTED ERROR.—
(1) APPLICABILITY.—This subsection applies if the retire-
ment coverage error was corrected before the effective date
of the regulations described under subsection (b)(3).
(2) ELECTION.—Not later than 180 days after the date
of the enactment of this Act, the Office shall prescribe regula-
tions authorizing individuals to elect, during the 18-month
period immediately following the effective date of such regula-
tions, to be CSRS-Offset covered or Social Security-Only cov-
ered, effective as of the date of the retirement coverage error.
(3) NONELECTION.—If an eligible individual does not make
an election under paragraph (2) before the end of any time
limitation under this subsection, the corrective action taken
before such time limitation shall remain in effect.
H. R. 4040—16
CHAPTER 4—EMPLOYEE WHO WAS ERRONEOUSLY FERS
COVERED
SEC. 2131. EMPLOYEE WHO SHOULD BE SOCIAL SECURITY-ONLY COV-
ERED, CSRS COVERED, OR CSRS-OFFSET COVERED AND
IS NOT FERS-ELIGIBLE, BUT WHO IS ERRONEOUSLY FERS
COVERED INSTEAD.
(a) APPLICABILITY.—This section applies in the case of a retire-
ment coverage error in which a Social Security-Only covered, CSRS
covered, or CSRS-Offset covered employee not eligible to elect FERS
coverage under authority of section 8402(c) of title 5, United States
Code, was erroneously FERS covered.
(b) UNCORRECTED ERROR.—
(1) APPLICABILITY.—This subsection applies if the retire-
ment coverage error has not been corrected before the effective
date of the regulations described in paragraph (2).
(2) COVERAGE.—
(A) ELECTION.—
(i) IN GENERAL.—Upon written notice of a retire-
ment coverage error, an individual may elect to remain
FERS covered or to be Social Security-Only covered,
CSRS covered, or CSRS-Offset covered, as would have
applied in the absence of the erroneous retirement
coverage determination, effective as of the date of the
retirement coverage error. Such election shall be made
not later than 180 days after the date of receipt of
such notice.
(ii) TREATMENT OF FERS ELECTION.—An election
of FERS coverage under this subsection is deemed
to be an election under section 301 of the Federal
Employees Retirement System Act of 1986 (5 U.S.C.
8331 note; Public Law 99–335; 100 Stat. 599).
(B) NONELECTION.—If the individual does not make
an election before the date provided under subparagraph
(A), the individual shall remain FERS covered, effective
as of the date of the retirement coverage error.
(3) EMPLOYEE CONTRIBUTIONS IN THRIFT SAVINGS FUND.—
If under this section, an individual elects to be Social Security-
Only covered, CSRS covered, or CSRS-Offset covered, all
employee contributions to the Thrift Savings Fund made during
the period of erroneous FERS coverage (and all earnings on
such contributions) may remain in the Thrift Savings Fund
in accordance with regulations prescribed by the Executive
Director, notwithstanding any limit under section 8351 or 8432
of title 5, United States Code.
(4) REGULATIONS.—Except as provided under paragraph
(3), the Office shall prescribe regulations to carry out this
subsection.
(c) CORRECTED ERROR.—
(1) APPLICABILITY.—This subsection applies if the retire-
ment coverage error was corrected before the effective date
of the regulations described under paragraph (2).
(2) ELECTION.—Not later than 180 days after the date
of the enactment of this Act, the Office shall prescribe regula-
tions authorizing individuals to elect, during the 18-month
period immediately following the effective date of such regula-
tions to remain Social Security-Only covered, CSRS covered,
H. R. 4040—17
or CSRS-Offset covered, or to be FERS covered, effective as
of the date of the retirement coverage error.
(3) NONELECTION.—If an eligible individual does not make
an election under paragraph (2), the corrective action taken
before the end of any time limitation under this subsection
shall remain in effect.
(4) TREATMENT OF FERS ELECTION.—An election of FERS
coverage under this subsection is deemed to be an election
under section 301 of the Federal Employees Retirement System
Act of 1986 (5 U.S.C. 8331 note; Public Law 99–335; 100 Stat.
599).
SEC. 2132. FERS-ELIGIBLE EMPLOYEE WHO SHOULD HAVE BEEN CSRS
COVERED, CSRS-OFFSET COVERED, OR SOCIAL SECU-
RITY-ONLY COVERED, BUT WHO WAS ERRONEOUSLY
FERS COVERED INSTEAD WITHOUT AN ELECTION.
(a) IN GENERAL.—
(1) FERS ELECTION PREVENTED.—If an individual was pre-
vented from electing FERS coverage because the individual
was erroneously FERS covered during the period when the
individual was eligible to elect FERS under title III of the
Federal Employees Retirement System Act or the Federal
Employees’ Retirement System Open Enrollment Act of 1997
(Public Law 105–61; 111 Stat. 1318 et seq.), the individual—
(A) is deemed to have elected FERS coverage; and
(B) shall remain covered by FERS, unless the indi-
vidual declines, under regulations prescribed by the Office,
to be FERS covered.
(2) DECLINING FERS COVERAGE.—If an individual described
under paragraph (1)(B) declines to be FERS covered, such indi-
vidual shall be CSRS covered, CSRS-Offset covered, or Social
Security-Only covered, as would apply in the absence of a
FERS election, effective as of the date of the erroneous retire-
ment coverage determination.
(b) EMPLOYEE CONTRIBUTIONS IN THRIFT SAVINGS FUND.—If
under this section, an individual declines to be FERS covered and
instead is Social Security-Only covered, CSRS covered, or CSRS-
Offset covered, as would apply in the absence of a FERS election,
all employee contributions to the Thrift Savings Fund made during
the period of erroneous FERS coverage (and all earnings on such
contributions) may remain in the Thrift Savings Fund in accordance
with regulations prescribed by the Executive Director, notwith-
standing any limit under title 5, United States Code, that would
otherwise be applicable.
(c) INAPPLICABILITY OF DURATION OF ERRONEOUS COVERAGE.—
This section shall apply regardless of the length of time the erro-
neous coverage determination remained in effect.
SEC. 2133. RETROACTIVE EFFECT.
This chapter shall be effective as of January 1, 1987, except
that section 2132 shall not apply to individuals who made or were
deemed to have made elections similar to those provided in this
section under regulations prescribed by the Office before the effec-
tive date of this title.
H. R. 4040—18
CHAPTER 5—EMPLOYEE WHO SHOULD HAVE BEEN
CSRS-OFFSET 
COVERED, 
BUT 
WHO 
WAS 
ERRO-
NEOUSLY CSRS COVERED INSTEAD
SEC. 2141. APPLICABILITY.
This chapter shall apply in the case of any employee who
should be (or should have been) CSRS-Offset covered but, as a
result of a retirement coverage error, is (or was) CSRS covered
instead.
SEC. 2142. CORRECTION MANDATORY.
(a) UNCORRECTED ERROR.—If the retirement coverage error
has not been corrected, as soon as practicable after discovery of
the error, such individual shall be covered under the correct retire-
ment coverage, effective as of the date of the retirement coverage
error.
(b) CORRECTED ERROR.—If the retirement coverage error has
been corrected before the effective date of this title, the corrective
action taken before such date shall remain in effect.
CHAPTER 6—EMPLOYEE WHO SHOULD HAVE BEEN
CSRS COVERED, BUT WHO WAS ERRONEOUSLY CSRS-
OFFSET COVERED INSTEAD
SEC. 2151. APPLICABILITY.
This chapter shall apply in the case of any employee who
should be (or should have been) CSRS covered but, as a result
of a retirement coverage error, is (or was) CSRS-Offset covered
instead.
SEC. 2152. CORRECTION MANDATORY.
(a) UNCORRECTED ERROR.—If the retirement coverage error
has not been corrected, as soon as practicable after discovery of
the error, such individual shall be covered under the correct retire-
ment coverage, effective as of the date of the retirement coverage
error.
(b) CORRECTED ERROR.—If the retirement coverage error has
been corrected before the effective date of this title, the corrective
action taken before such date shall remain in effect.
Subtitle B—General Provisions
SEC. 2201. IDENTIFICATION AND NOTIFICATION REQUIREMENTS.
Government agencies shall take all such measures as may
be reasonable and appropriate to promptly identify and notify
individuals who are (or have been) affected by a retirement coverage
error of their rights under this title.
SEC. 2202. INFORMATION TO BE FURNISHED TO AND BY AUTHORITIES
ADMINISTERING THIS TITLE.
(a) APPLICABILITY.—The authorities identified in this subsection
are—
(1) the Director of the Office of Personnel Management;
(2) the Commissioner of Social Security; and
(3) the Executive Director of the Federal Retirement Thrift
Investment Board.
H. R. 4040—19
(b) AUTHORITY
TO
OBTAIN
INFORMATION.—Each authority
identified in subsection (a) may secure directly from any department
or agency of the United States information necessary to enable
such authority to carry out its responsibilities under this title.
Upon request of the authority involved, the head of the department
or agency involved shall furnish that information to the requesting
authority.
(c) AUTHORITY
TO
PROVIDE
INFORMATION.—Each authority
identified in subsection (a) may provide directly to any department
or agency of the United States all information such authority
believes necessary to enable the department or agency to carry
out its responsibilities under this title.
(d) LIMITATION; SAFEGUARDS.—Each of the respective authori-
ties under subsection (a) shall—
(1) request or provide only such information as that
authority considers necessary; and
(2) establish, by regulation or otherwise, appropriate safe-
guards to ensure that any information obtained under this
section shall be used only for the purpose authorized.
SEC. 2203. SERVICE CREDIT DEPOSITS.
(a) CSRS DEPOSIT.—In the case of a retirement coverage error
in which—
(1) a FERS covered employee was erroneously CSRS cov-
ered or CSRS-Offset covered;
(2) the employee made a service credit deposit under the
CSRS rules; and
(3) there is a subsequent retroactive change to FERS cov-
erage,
the excess of the amount of the CSRS civilian or military service
credit deposit over the FERS civilian or military service credit
deposit, together with interest computed in accordance with para-
graphs (2) and (3) of section 8334(e) of title 5, United States Code,
and regulations prescribed by the Office, shall be paid to the
employee, the annuitant or, in the case of a deceased employee,
to the individual entitled to lump-sum benefits under section
8424(d) of title 5, United States Code.
(b) FERS DEPOSIT.—
(1) APPLICABILITY.—This subsection applies in the case of
an erroneous retirement coverage determination in which—
(A) the employee owed a service credit deposit under
section 8411(f ) of title 5, United States Code; and
(B)(i) there is a subsequent retroactive change to CSRS
or CSRS-Offset coverage; or
(ii) the service becomes creditable under chapter 83
of title 5, United States Code.
(2) REDUCED ANNUITY.—
(A) IN GENERAL.—If at the time of commencement of
an annuity there is remaining unpaid CSRS civilian or
military service credit deposit for service described under
paragraph (1), the annuity shall be reduced based upon
the amount unpaid together with interest computed in
accordance with section 8334(e)(2) and (3) of title 5, United
States Code, and regulations prescribed by the Office.
(B) AMOUNT.—The reduced annuity to which the indi-
vidual is entitled shall be equal to an amount that, when
H. R. 4040—20
taken together with the amount referred to under subpara-
graph (A), would result in the present value of the total
being actuarially equivalent to the present value of the
unreduced annuity benefit that would have been provided
the individual.
(3) SURVIVOR ANNUITY.—
(A) IN GENERAL.—If at the time of commencement of
a survivor annuity, there is remaining unpaid any CSRS
service credit deposit described under paragraph (1), and
there has been no actuarial reduction in an annuity under
paragraph (2), the survivor annuity shall be reduced based
upon the amount unpaid together with interest computed
in accordance with section 8334(e)(2) and (3) of title 5,
United States Code, and regulations prescribed by the
Office.
(B) AMOUNT.—The reduced survivor annuity to which
the individual is entitled shall be equal to an amount
that, when taken together with the amount referred to
under subparagraph (A), would result in the present value
of the total being actuarially equivalent to the present
value of an unreduced survivor annuity benefit that would
have been provided the individual.
SEC. 2204. PROVISIONS RELATED TO SOCIAL SECURITY COVERAGE
OF MISCLASSIFIED EMPLOYEES.
(a) DEFINITIONS.—In this section, the term—
(1) ‘‘covered individual’’ means any employee, former
employee, or annuitant who—
(A) is or was employed erroneously subject to CSRS
coverage as a result of a retirement coverage error; and
(B) is or was retroactively converted to CSRS-offset
coverage, FERS coverage, or Social Security-Only coverage;
and
(2) ‘‘excess CSRS deduction amount’’ means an amount
equal to the difference between the CSRS deductions withheld
and the CSRS-Offset or FERS deductions, if any, due with
respect to a covered individual during the entire period the
individual was erroneously subject to CSRS coverage as a result
of a retirement coverage error.
(b) REPORTS TO COMMISSIONER OF SOCIAL SECURITY.—
(1) IN GENERAL.—In order to carry out the Commissioner
of Social Security’s responsibilities under title II of the Social
Security Act, the Commissioner may request the head of each
agency that employs or employed a covered individual to report
(in coordination with the Office of Personnel Management) in
such form and within such timeframe as the Commissioner
may specify, any or all of—
(A) the total wages (as defined in section 3121(a) of
the Internal Revenue Code of 1986) paid to such individual
during each year of the entire period of the erroneous
CSRS coverage; and
(B) such additional information as the Commissioner
may require for the purpose of carrying out the Commis-
sioner’s responsibilities under title II of the Social Security
Act (42 U.S.C. 401 et seq.).
H. R. 4040—21
(2) COMPLIANCE.—The head of an agency or the Office
shall comply with a request from the Commissioner under
paragraph (1).
(3) WAGES.—For purposes of section 201 of the Social Secu-
rity Act (42 U.S.C. 401), wages reported under this subsection
shall be deemed to be wages reported to the Secretary of
the Treasury or the Secretary’s delegates pursuant to subtitle
F of the Internal Revenue Code of 1986.
(c) PAYMENT RELATING
TO OASDI EMPLOYEE TAXES.—The
Office shall transfer from the Civil Service Retirement and Dis-
ability Fund to the General Fund of the Treasury an amount
equal to the lesser of the excess CSRS deduction amount or the
OASDI taxes due for covered individuals (as adjusted by amounts
transferred relating to applicable OASDI employee taxes as a result
of corrections made, including corrections made before the date
of the enactment of this Act). If the excess CSRS deductions exceed
the OASDI taxes, any difference shall be paid to the covered indi-
vidual or survivors, as appropriate.
(d) PAYMENT OF OASDI EMPLOYER TAXES.—
(1) IN
GENERAL.—Each employing agency shall pay an
amount equal to the OASDI employer taxes owed with respect
to covered individuals during the applicable period of erroneous
coverage (as adjusted by amounts transferred for the payment
of such taxes as a result of corrections made, including correc-
tions made before the date of the enactment of this Act).
(2) PAYMENT.—Amounts paid under this subsection shall
be determined subject to any limitation under section 6501
of the Internal Revenue Code of 1986.
SEC. 2205. THRIFT SAVINGS PLAN TREATMENT FOR CERTAIN INDIVID-
UALS.
(a) APPLICABILITY.—This section applies to an individual who—
(1) is eligible to make an election of coverage under section
2101 or 2102, and only if FERS coverage is elected (or remains
in effect) for the employee involved; or
(2) is described in section 2111, and makes or has made
retroactive employee contributions to the Thrift Savings Fund
under regulations prescribed by the Executive Director.
(b) PAYMENT INTO THRIFT SAVINGS FUND.—
(1) IN GENERAL.—
(A) PAYMENT.—With respect to an individual to whom
this section applies, the employing agency shall pay to
the Thrift Savings Fund under subchapter III of chapter
84 of title 5, United States Code, for credit to the account
of the employee involved, an amount equal to the earnings
which are disallowed under section 8432a(a)(2) of such
title on the employee’s retroactive contributions to such
Fund.
(B) AMOUNT.—Earnings under subparagraph (A) shall
be computed in accordance with the procedures for com-
puting lost earnings under section 8432a of title 5, United
States Code. The amount paid by the employing agency
shall be treated for all purposes as if that amount had
actually been earned on the basis of the employee’s con-
tributions.
(C) EXCEPTIONS.—If an individual made retroactive
contributions before the effective date of the regulations
H. R. 4040—22
under section 2101(c), the Director may provide for an
alternative calculation of lost earnings to the extent that
a calculation under subparagraph (B) is not administra-
tively feasible. The alternative calculation shall yield an
amount that is as close as practicable to the amount com-
puted under subparagraph (B), taking into account
earnings previously paid.
(2) ADDITIONAL
EMPLOYEE
CONTRIBUTION.—In cases in
which the retirement coverage error was corrected before the
effective date of the regulations under section 2101(c), the
employee involved shall have an additional opportunity to make
retroactive contributions for the period of the retirement cov-
erage error (subject to applicable limits), and such contributions
(including any contributions made after the date of the correc-
tion) shall be treated in accordance with paragraph (1).
(c) REGULATIONS.—
(1) EXECUTIVE
DIRECTOR.—The Executive Director shall
prescribe regulations appropriate to carry out this section
relating to retroactive employee contributions and payments
made on or after the effective date of the regulations under
section 2101(c).
(2) OFFICE.—The Office, in consultation with the Federal
Retirement Thrift Investment Board, shall prescribe regulations
appropriate to carry out this section relating to the calculation
of lost earnings on retroactive employee contributions made
before the effective date of the regulations under section
2101(c).
SEC. 2206. CERTAIN AGENCY AMOUNTS TO BE PAID INTO OR REMAIN
IN THE CSRDF.
(a) CERTAIN EXCESS AGENCY CONTRIBUTIONS TO REMAIN IN
THE CSRDF.—
(1) IN GENERAL.—Any amount described under paragraph
(2) shall—
(A) remain in the CSRDF; and
(B) may not be paid or credited to an agency.
(2) AMOUNTS.—Paragraph (1) refers to any amount of con-
tributions made by an agency under section 8423 of title 5,
United States Code, on behalf of any employee, former
employee, or annuitant (or survivor of such employee, former
employee, or annuitant) who makes an election to correct a
retirement coverage error under this title, that the Office deter-
mines to be excess as a result of such election.
(b) ADDITIONAL EMPLOYEE RETIREMENT DEDUCTIONS TO BE
PAID BY AGENCY.—If a correction in a retirement coverage error
results in an increase in employee deductions under section 8334
or 8422 of title 5, United States Code, that cannot be fully paid
by a reallocation of otherwise available amounts previously
deducted from the employee’s pay as employment taxes or retire-
ment deductions, the employing agency—
(1) shall pay the required additional amount into the
CSRDF; and
(2) shall not seek repayment of that amount from the
employee, former employee, annuitant, or survivor.
H. R. 4040—23
SEC. 2207. CSRS COVERAGE DETERMINATIONS TO BE APPROVED BY
OPM.
No agency shall place an individual under CSRS coverage
unless—
(1) the individual has been employed with CSRS coverage
within the preceding 365 days; or
(2) the Office has agreed in writing that the agency’s cov-
erage determination is correct.
SEC. 2208. DISCRETIONARY ACTIONS BY DIRECTOR.
(a) IN GENERAL.—The Director of the Office of Personnel
Management may—
(1) extend the deadlines for making elections under this
title in circumstances involving an individual’s inability to make
a timely election due to a cause beyond the individual’s control;
(2) provide for the reimbursement of necessary and reason-
able expenses incurred by an individual with respect to settle-
ment of a claim for losses resulting from a retirement coverage
error, including attorney’s fees, court costs, and other actual
expenses;
(3) compensate an individual for monetary losses that are
a direct and proximate result of a retirement coverage error,
excluding claimed losses relating to forgone contributions and
earnings under the Thrift Savings Plan under subchapter III
of chapter 84 of title 5, United States Code, and all other
investment opportunities; and
(4) waive payments required due to correction of a retire-
ment coverage error under this title.
(b) SIMILAR ACTIONS.—In exercising the authority under this
section, the Director shall, to the extent practicable, provide for
similar actions in situations involving similar circumstances.
(c) JUDICIAL REVIEW.—Actions taken under this section are
final and conclusive, and are not subject to administrative or judicial
review.
(d) REGULATIONS.—The Office of Personnel Management shall
prescribe regulations regarding the process and criteria used in
exercising the authority under this section.
(e) REPORT.—The Office of Personnel Management shall, not
later than 180 days after the date of the enactment of this Act,
and annually thereafter for each year in which the authority pro-
vided in this section is used, submit a report to each House of
Congress on the operation of this section.
SEC. 2209. REGULATIONS.
(a) IN GENERAL.—In addition to the regulations specifically
authorized in this title, the Office may prescribe such other regula-
tions as are necessary for the administration of this title.
(b) FORMER SPOUSE.—The regulations prescribed under this
title shall provide for protection of the rights of a former spouse
with entitlement to an apportionment of benefits or to survivor
benefits based on the service of the employee.
H. R. 4040—24
Subtitle C—Other Provisions
SEC. 2301. PROVISIONS TO AUTHORIZE CONTINUED CONFORMITY OF
OTHER FEDERAL RETIREMENT SYSTEMS.
(a) FOREIGN SERVICE.—Sections 827 and 851 of the Foreign
Service Act of 1980 (22 U.S.C. 4067 and 4071) shall apply with
respect to this title in the same manner as if this title were
part of—
(1) the Civil Service Retirement System, to the extent
this title relates to the Civil Service Retirement System; and
(2) the Federal Employees’ Retirement System, to the
extent this title relates to the Federal Employees’ Retirement
System.
(b) CENTRAL INTELLIGENCE AGENCY.—Sections 292 and 301
of the Central Intelligence Agency Retirement Act (50 U.S.C. 2141
and 2151) shall apply with respect to this title in the same manner
as if this title were part of—
(1) the Civil Service Retirement System, to the extent
this title relates to the Civil Service Retirement System; and
(2) the Federal Employees’ Retirement System, to the
extent this title relates to the Federal Employees’ Retirement
System.
SEC. 2302. AUTHORIZATION OF PAYMENTS.
All payments authorized or required by this title to be paid
from the Civil Service Retirement and Disability Fund, together
with administrative expenses incurred by the Office in admin-
istering this title, shall be deemed to have been authorized to
be paid from that Fund, which is appropriated for the payment
thereof.
SEC. 2303. INDIVIDUAL RIGHT OF ACTION PRESERVED FOR AMOUNTS
NOT OTHERWISE PROVIDED FOR UNDER THIS TITLE.
Nothing in this title shall preclude an individual from bringing
a claim against the Government of the United States which such
individual may have under section 1346(b) or chapter 171 of title
28, United States Code, or any other provision of law (except
to the extent the claim is for any amounts otherwise provided
for under this title).
H. R. 4040—25
Subtitle D—Effective Date
SEC. 2401. EFFECTIVE DATE.
Except as otherwise provided in this title, this title shall take
effect on the date of the enactment of this Act.
Speaker of the House of Representatives.
Vice President of the United States and
President of the Senate.