I
104TH CONGRESS
2D SESSION
H. R. 3841
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 fol-
lowing bill; which was referred to the Committee on Government Reform
and Oversight
A BILL
To amend the civil service laws of the United States, and
for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) SHORT TITLE.—This Act may be cited as the
‘‘Omnibus Civil Service Reform Act of 1996’’.
(b) TABLE OF CONTENTS.—The table of contents for
this Act is as follows:
Sec. 1. Short title; table of contents.
TITLE I—DEMONSTRATION PROJECTS
Sec. 101. Demonstration projects.
TITLE II—SIMPLIFYING APPEALS
Sec. 201. Elimination of mixed-case procedures.
Sec. 202. Appeal to Merit Systems Protection Board as exclusive administrative
remedy.
Sec. 203. Agency flexibility and encouraging the use of alternative dispute reso-
lution techniques.
Sec. 204. Effective date.
TITLE III—PERFORMANCE MANAGEMENT ENHANCEMENT
Sec. 301. Increased weight given to performance for order-of-retention purposes
in a reduction in force.
Sec. 302. No appeal of denial of periodic step-increases.
Sec. 303. Performance appraisals.
Sec. 304. Amendments to incentive awards authority.
Sec. 305. Due process rights of managers under negotiated grievance proce-
dures.
Sec. 306. Collection and reporting of training information.
TITLE IV—ENHANCEMENT OF THRIFT SAVINGS PLAN AND
CERTAIN OTHER BENEFITS
Subtitle A—Additional Investment Funds for the Thrift Savings Plan
Sec. 401. Short title.
Sec. 402. Additional investment funds for the Thrift Savings Plan.
Sec. 403. Acknowledgement of investment risk.
Sec. 404. Effective date.
Subtitle B—Thrift Savings Account Liquidity
Sec. 411. Short title.
Sec. 412. Notice to spouses for in-service withdrawals; de minimus accounts;
Civil Service Retirement System participants.
Sec. 413. In-service withdrawals; withdrawal elections, Federal Employees Re-
tirement System participants.
Sec. 414. Survivor annuities for former spouses; notice to Federal Employees
Retirement System spouses for in-service withdrawals.
Sec. 415. De minimus accounts relating to the judiciary.
Sec. 416. Definition of basic pay.
Sec. 417. Eligible rollover distributions.
Sec. 418. Effective date.
Subtitle C—Other Provisions Relating to the Thrift Savings Plan
Sec. 421. Percentage limitations on contributions.
Sec. 422. Loans under the Thrift Savings Plan for furloughed employees.
Sec. 423. Immediate participation in the Thrift Savings Plan.
Subtitle D—Resumption of Certain Survivor Annuities That Terminated by
Reason of Marriage
Sec. 431. Resumption of certain survivor annuities that terminated by reason
of marriage.
Subtitle E—Life Insurance Benefits
Sec. 441. Domestic relations orders.
Sec. 442. Exception from provisions requiring reduction in additional optional
life insurance.
Sec. 443. Temporary continuation of Federal employees’ life insurance.
TITLE V—REORGANIZATION FLEXIBILITY
Sec. 501. Voluntary reductions in force.
Sec. 502. Nonreimbursable details to Federal agencies before a reduction in
force.
TITLE VI—SOFT-LANDING PROVISIONS
Sec. 601. Continued eligibility for life insurance.
Sec. 602. Continued eligibility for health insurance.
Sec. 603. Priority placement programs for Federal employees affected by a re-
duction in force.
Sec. 604. Job placement and counseling services.
Sec. 605. Education and retraining incentives.
TITLE VII—MISCELLANEOUS
Sec. 701. Reimbursements relating to professional liability insurance.
Sec. 702. Employment rights following conversion to contract.
Sec. 703. Debarment of health care providers found to have engaged in fraudu-
lent practices.
Sec. 704. Extension of certain procedural and appeal rights to certain person-
nel of the Federal Bureau of Investigation.
Sec. 705. Conversion of certain excepted service positions in the United States
Fire Administration to competitive service positions.
Sec. 706. Eligibility for certain survivor annuity benefits.
TITLE I—DEMONSTRATION
PROJECTS
SEC. 101. DEMONSTRATION PROJECTS.
(a) DEFINITIONS.—Paragraph (1) of section 4701(a)
of title 5, United States Code, is amended by striking sub-
paragraph (A) and by redesignating subparagraphs (B)
and (C) as subparagraphs (A) and (B), respectively.
(b) 
PRE-IMPLEMENTATION
PROCEDURES.—Sub-
section (b) of section 4703 of title 5, United States Code,
is amended to read as follows:
‘‘(b) Before an agency or the Office may conduct or
enter into any agreement or contract to conduct a dem-
onstration project, the Office—
‘‘(1) shall develop or approve a plan for such
project which identifies—
‘‘(A) the purposes of the project;
‘‘(B) the methodology;
‘‘(C) the duration; and
‘‘(D) the methodology and criteria for eval-
uation;
‘‘(2) shall publish the plan in the Federal Reg-
ister;
‘‘(3) may solicit comments from the public and
interested parties in such manner as the Office con-
siders appropriate;
‘‘(4) shall obtain approval from each agency in-
volved of the final version of the plan; and
‘‘(5) shall provide notification of the proposed
project, at least 30 days in advance of the date any
project proposed under this section is to take ef-
fect—
‘‘(A) to employees who are likely to be af-
fected by the project; and
‘‘(B) to each House of the Congress.’’.
(c) NONWAIVABLE PROVISIONS.—Section 4703(c) of
title 5, United States Code, is amended—
(1) by striking paragraph (1) and inserting the
following:
‘‘(1) any provision of subchapter V of chapter
63 or subpart G of this title;’’; and
(2) by striking paragraph (3) and inserting the
following:
‘‘(3) any provision of chapter 15 or subchapter
II or III of chapter 73 of this title;’’.
(d) LIMITATIONS.—Subsection (d) of section 4703 of
title 5, United States Code, is amended to read as follows:
‘‘(d)(1) Each demonstration project shall terminate
before the end of the 5-year period beginning on the date
on which the project takes effect, except that the project
may continue for a maximum of 2 years beyond the date
to the extent necessary to validate the results of the
project.
‘‘(2)(A) Not more than 15 active demonstration
projects may be in effect at any time, and of the projects
in effect at any time, not more than 5 may involve 5,000
or more individuals each.
‘‘(B) Individuals in a control group necessary to vali-
date the results of a project shall not, for purposes of any
determination under subparagraph (A), be considered to
be involved in such project.’’.
(e) CONDITION RELATING TO BARGAINING AGREE-
MENTS.—Paragraph (1) of section 4703(f) of title 5, Unit-
ed States Code, is amended by striking ‘‘(as defined in
section 7103(8) of this title)’’ and inserting ‘‘(as defined
in section 7103(8), excluding any agreements entered into
or renewed after the date of the enactment of the Omnibus
Civil Service Reform Act of 1996)’’.
(f) EVALUATIONS.—Subsection (h) of section 4703 of
title 5, United States Code, is amended by adding at the
end the following: ‘‘The Office may, with respect to a dem-
onstration project conducted by another agency, require
that the preceding sentence be carried out by such other
agency.’’.
(g) PROVISIONS FOR TERMINATION OF PROJECT OR
MAKING IT PERMANENT.—Section 4703 of title 5, United
States Code, is amended—
(1) in subsection (i) by inserting ‘‘by the Of-
fice’’ after ‘‘undertaken’’; and
(2) by adding at the end the following:
‘‘(j)(1) If the Office determines that termination of
a demonstration project (whether under subsection (e) or
otherwise) would result in the inequitable treatment of em-
ployees who participated in the project, the Office shall
take such corrective action as is within its authority. If
the Office determines that legislation is necessary to cor-
rect an inequity, it shall submit an appropriate legislative
proposal to both Houses of Congress.
‘‘(2) If the Office determines that a demonstration
project should be made permanent, it shall submit an ap-
propriate legislative proposal to both Houses of Con-
gress.’’.
TITLE II—SIMPLIFYING
APPEALS
SEC. 201. ELIMINATION OF MIXED-CASE PROCEDURES.
(a) IN GENERAL.—Section 7702, paragraph (2) of
section 7703(b), and the last sentence of section 7121(d)
of title 5, United States Code, are repealed.
(b) TECHNICAL AND CONFORMING AMENDMENTS.—
(1) The item relating to section 7702 in the table of sec-
tions at the beginning of chapter 77 of title 5, United
States Code, is repealed.
(2) Section 7701(e)(1) of title 5, United States Code,
is amended—
(A) by striking ‘‘(e)(1) Except as provided in
section 7702 of this title, any’’ and inserting ‘‘(e)
Any’’;
(B) by redesignating subparagraphs (A) and
(B) as paragraphs (1) and (2), respectively; and
(C) by striking ‘‘subparagraph (A) of this para-
graph.’’ and inserting ‘‘paragraph (1).’’.
(3) Section 753(e)(1) of title 31, United States Code,
is amended by striking ‘‘sections 7701 and 7702’’ and in-
serting ‘‘section 7701’’.
(4) Section 7703(c) of title 5, United States Code,
is amended by striking the semicolon at the end of para-
graph (3) and all that follows through ‘‘court.’’ and insert-
ing a period.
SEC. 202. APPEAL TO MERIT SYSTEMS PROTECTION BOARD
AS EXCLUSIVE ADMINISTRATIVE REMEDY.
(a) IN GENERAL.—Section 7701(b)(1) of title 5,
United States Code, is amended by striking ‘‘(b)(1)’’ and
inserting ‘‘(b)(1)(A)’’ and by adding at the end the follow-
ing:
‘‘(B) Notwithstanding any other provision of law,
rule, or regulation, an appeal under this section shall be
the exclusive administrative remedy for any action by an
employee or applicant who—
‘‘(i) has been affected by an action which the
employee or applicant may appeal to the Merit Sys-
tems Protection Board; and
‘‘(ii) alleges that a basis for the action was dis-
crimination prohibited by—
‘‘(I) section 717 of the Civil Rights Act of
1964;
‘‘(II) section 6(d) of the Fair Labor Stand-
ards Act of 1938;
‘‘(III) section 501 of the Rehabilitation Act
of 1973;
‘‘(IV) sections 12 and 15 of the Age Dis-
crimination in Employment Act of 1967; or
‘‘(V) any rule, regulation, or policy direc-
tive prescribed under any provision of law de-
scribed in subclauses (I) through (IV).
‘‘(C) In lieu of filing an appeal under this section,
an employee or applicant described in paragraph (B) may
file a civil action under—
‘‘(i) section 717(c) of the Civil Rights Act of
1964 or section 15(c) of the Age Discrimination in
Employment Act of 1967, as applicable, within 90
days after receipt of notice of final action taken by
the agency on a complaint of discrimination under a
provision of law described in subclause (I), (III), or
(IV) of subparagraph (B)(ii) or any rule, regulation,
or policy directive prescribed under any such provi-
sion of law; or
‘‘(ii) section 16(b) of the Fair Labor Standards
Act of 1938 within 2 years (or, if the violation is
willful, within 3 years) after the date of an alleged
violation of section 6(d) of the Fair Labor Stand-
ards Act of 1938 or any rule, regulation, or policy
directive prescribed thereunder.’’.
(b) PETITION
FOR BOARD REVIEW.—(1) Section
7701(e)(1)(A) of title 5, United States Code, is amended
by striking ‘‘a party to the appeal or the Director’’ and
inserting ‘‘a party to the appeal, the Director, or the
Equal Employment Opportunity Commission’’.
(2) Subsection (e) of section 7701 of title 5, United
States Code, is amended by adding at the end the follow-
ing:
‘‘(3) The Equal Employment Opportunity Commis-
sion may petition the Board for review under paragraph
(1) only if the Commission is of the opinion that the deci-
sion is erroneous and will have a substantial impact on
any equal employment opportunity law, rule, or regulation
under the jurisdiction of the Commission.’’.
(3) Subsection (d) of section 7703 of title 5, United
States Code, is amended to read as follows:
‘‘(d)(1) The Director of the Office of Personnel Man-
agement may obtain review of any final order or decision
of the Board by filing a petition for judicial review in the
United States Court of Appeals for the Federal Circuit
if the Director determines, in his discretion, that the
Board erred in interpreting a civil service law, rule, or reg-
ulation affecting personnel management and that the
Board’s decision will have a substantial impact on a civil
service law, rule, regulation, or policy directive.
‘‘(2) The Equal Employment Opportunity Commis-
sion may obtain review of any final order or decision of
the Board by filing a petition for judicial review in the
United States Court of Appeals for the Federal Circuit
if the Commission determines, in its discretion, that the
Board erred in interpreting an equal employment oppor-
tunity law and that the Board’s decision will have a sub-
stantial impact on an equal employment opportunity law,
rule, regulation, or policy directive.
‘‘(3) If the Director or the Commission did not inter-
vene in a matter before the Board, the Director or the
Commission may not petition for review of a Board deci-
sion under this section unless the Director or the Commis-
sion first petitions the Board for reconsideration of its de-
cision, and such petition is denied.
‘‘(4) In addition to the named respondent, the Board
and all other parties to the proceedings before the Board
shall have the right to appear in the proceeding before
the Court of Appeals. The granting of the petition for re-
view shall be at the discretion of the Court of Appeals,
except that it may not deny a petition for review solely
because it disagrees with the determination of the Director
or the Commission that the Board’s decision will have a
substantial impact on a law, rule, regulation, or policy di-
rective within their jurisdiction. The Court of Appeals
shall require payment by the Director or the Commission,
as appropriate, of reasonable attorney fees incurred by the
other parties if, after rendering a decision on the merits
of the petition, the court determines that the Board’s deci-
sion would not have had a substantial impact on a law,
rule, regulation, or policy directive within their jurisdic-
tion.’’.
SEC. 203. AGENCY FLEXIBILITY AND ENCOURAGING THE
USE OF ALTERNATIVE DISPUTE RESOLUTION
TECHNIQUES.
(a) IN GENERAL.—Chapter 77 of title 5, United
States Code, is amended by adding at the end the follow-
ing:
‘‘§ 7704. Alternative dispute resolution techniques
‘‘Notwithstanding any other provision of law, each
agency (including the United States Postal Service, the
Postal Rate Commission, and the Tennessee Valley Au-
thority) shall have the authority to develop an internal
procedure under which its employees may file with the
agency a complaint of discrimination by the agency under
the laws described in subclauses (I) through (V) of section
7701(b)(1)(B)(ii), or any other matter appealable to the
Merit Systems Protection Board or the Federal Labor Re-
lations Authority. Agencies are encouraged to use alter-
native dispute resolution techniques in order to resolve
such complaints. An agency may require its employees to
exhaust such internal procedure for a period not to exceed
90 days before seeking external administrative or judicial
review under this chapter. To the extent that a private
entity may do so, an agency may require employees to sub-
mit to alternative dispute resolution techniques in lieu of
other administrative or judicial review.’’.
(b) TASK FORCE.—In order to encourage the use of
alternative dispute resolution techniques in resolving per-
sonnel-related disputes within the Federal Government,
the Chairman of the Merit Systems Protection Board
shall, in consultation with the Chairman of the Equal Em-
ployment Opportunity Commission, the Chairman of the
Federal Labor Relations Authority, the Director of the Of-
fice of Personnel Management, the Special Counsel, and
the Director of the Federal Mediation and Conciliation
Service, organize and chair a task force—
(1) to study and evaluate the use of alternative
dispute resolution techniques in resolving Federal
personnel disputes;
(2) to facilitate the exchange of information be-
tween agencies;
(3) to examine and evaluate alternative dispute
resolution techniques used in the private sector for
possible application to Federal personnel disputes;
and
(4) to issue a report to Congress no later than
18 months after the date of enactment of this Act
on the use of alternative dispute resolution tech-
niques in personnel disputes by Federal agencies, in-
cluding Federal adjudicatory agencies.
The Merit Systems Protection Board shall provide admin-
istrative support to the task force.
SEC. 204. EFFECTIVE DATE.
(a) IN GENERAL.—Except as otherwise provided in
this section, this title and the amendments made by this
title shall take effect 6 months after the date of the enact-
ment of this Act.
(b) TASK FORCE.—Subsection (b) of section 203
shall take effect on the date of the enactment of this Act.
(c) SAVINGS PROVISION.—Matters or proceedings
pending as of, and continuing after, the effective date of
this title shall continue as if this title had not been en-
acted.
TITLE III—PERFORMANCE
MANAGEMENT ENHANCEMENT
SEC. 301. INCREASED WEIGHT GIVEN TO PERFORMANCE
FOR ORDER-OF-RETENTION PURPOSES IN A
REDUCTION IN FORCE.
(a) IN GENERAL.—Section 3502 of title 5, United
States Code, is amended—
(1) in subsection (a)(4) by striking ‘‘ratings.’’
and inserting ‘‘ratings, in conformance with the re-
quirements of subsection (g).’’; and
(2) by adding at the end the following:
‘‘(g)(1) The regulations prescribed to carry out sub-
section (a)(4) shall be the regulations in effect, as of Janu-
ary 1, 1996, under section 351.504 of title 5 of the Code
of Federal Regulations, except as otherwise provided in
this subsection.
‘‘(2) For purposes of this subsection—
‘‘(A) subsections (b)(4) and (e) of such section
351.504 shall be disregarded;
‘‘(B) subsection (d) of such section 351.504
shall be considered to read as follows:
‘‘ ‘(d)(1) The additional service credit an employee re-
ceives for performance under this subpart shall be ex-
pressed in additional years of service and shall consist of
the sum of the employee’s 3 most recent (actual and/or
assumed) annual performance ratings received during the
4-year period prior to the date of issuance of reduction-
in-force notices or the 4-year period prior to the agency-
established cutoff date (as appropriate), computed in ac-
cordance with paragraph (2) or (3) (as appropriate).
‘‘ ‘(2) Except as provided in paragraph (3), an em-
ployee shall receive—
‘‘ ‘(A) 5 additional years of service for each per-
formance rating of fully successful (Level 3) or
equivalent;
‘‘ ‘(B) 7 additional years of service for each per-
formance rating of exceeds fully successful (Level 4)
or equivalent; and
‘‘ ‘(C) 10 additional years of service for each
performance rating of outstanding (Level 5) or
equivalent.
‘‘ ‘(3)(A) If the employing agency uses a rating sys-
tem having only 1 rating to denote performance which is
fully successful or better, then an employee under such
system shall receive 5 additional years of service for each
such rating.
‘‘ ‘(B) If the employing agency uses a rating system
having only 2 ratings to denote performance which is fully
successful or better, then an employee under such system
shall receive—
‘‘ ‘(i) 5 additional years of service for each per-
formance rating at the lower of those 2 ratings; and
‘‘ ‘(ii) 7 additional years of service for each per-
formance rating at the higher of those 2 ratings.
‘‘ ‘(C) If the employing agency uses a rating system
having 3 or more ratings to denote performance which is
fully successful or better, then an employee under such
system shall receive—
‘‘ ‘(i) 5 additional years of service for each per-
formance rating at the lowest of those 3 or more
ratings;
‘‘ ‘(ii) 7 additional years of service for each per-
formance rating at the next rating above the rating
referred to in clause (i); and
‘‘ ‘(iii) 10 additional years of service for each
performance rating above the rating referred to in
clause (ii).
‘‘ ‘(D) For purposes of this paragraph, a rating shall
not be considered to denote performance which is fully
successful or better unless, in order to receive such rating,
such performance must satisfy all requirements for a fully
successful rating (Level 3) or equivalent, as established
under part 430 of this chapter (as in effect as of January
1, 1996).’; and
‘‘(C) subsection (c) of such section shall be con-
sidered to read as follows:
‘‘ ‘(c)(1) Service credit for employees who do not have
3 actual annual performance ratings of record received
during the 4-year period prior to the date of issuance of
reduction-in-force notices, or the 4-year period prior to the
agency-established cutoff date for ratings permitted in
subsection (b)(2) of this section, shall be determined in
accordance with paragraph (2).
‘‘ ‘(2) An employee who has not received 1 or more
of the 3 annual performance ratings of record required
under this section shall—
‘‘ ‘(A) receive credit for performance on the
basis of the rating or ratings actually received (if
any); and
‘‘ ‘(B) for each performance rating not actually
received, be given credit for 5 additional years of
service.’.’’.
(b) EFFECTIVE DATE.—The amendments made by
this section shall apply with respect to reductions in force
taking effect on or after October 1, 1999.
SEC. 302. NO APPEAL OF DENIAL OF PERIODIC STEP-IN-
CREASES.
(a) IN GENERAL.—Section 5335(c) of title 5, United
States Code, is amended—
(1) by striking the second sentence;
(2) in the third sentence by striking ‘‘or ap-
peal’’; and
(3) in the last sentence by striking ‘‘and the en-
titlement of the employee to appeal to the Board do
not apply’’ and inserting ‘‘does not apply’’.
(b) PERFORMANCE RATINGS.—Section 5335 of title
5, United States Code, as amended by subsection (a), is
further amended—
(1) in subsections (a)(B) and (c) by striking ‘‘of
an acceptable level of competence’’ and inserting ‘‘at
least fully successful’’;
(2) in the last sentence of subsection (c) by
striking ‘‘acceptable level of competence’’ and insert-
ing ‘‘fully successful work performance’’; and
(3) by adding at the end the following:
‘‘(g) For purposes of this section, the term ‘fully suc-
cessful’ has a meaning similar to that given under section
351.504(d)(3)(D) of title 5 of the Code of Federal Regula-
tions (as deemed to be amended by section 301(a)(2) of
the Omnibus Civil Service Reform Act of 1996).’’.
SEC. 303. PERFORMANCE APPRAISALS.
(a) IN GENERAL.—Section 4302 of title 5, United
States Code, is amended—
(1) in subsection (b) by striking paragraphs (5)
and (6) and inserting the following:
‘‘(5) assisting employees in improving unaccept-
able performance, except in circumstances described
in subsection (c); and
‘‘(6) reassigning, reducing in grade, removing,
or taking other appropriate action against employees
whose performance is unacceptable.’’; and
(2) by adding at the end the following:
‘‘(c) Upon notification of unacceptable performance,
an employee shall be afforded an opportunity to dem-
onstrate acceptable performance before a reduction in
grade or removal may be proposed under section 4303
based on such performance, except that an employee so
afforded such an opportunity shall not be afforded any
further opportunity to demonstrate acceptable perform-
ance if the employee’s performance again is determined
to be at an unacceptable level.’’.
(b) EFFECTIVE DATE.—
(1) IN GENERAL.—Subject to paragraph (2),
this section and the amendments made by this sec-
tion shall take effect 180 days after the date of the
enactment of this Act.
(2) EXCEPTION.—The amendments made by
this section shall not apply in the case of any pro-
posed action as to which the employee receives ad-
vance written notice, in accordance with section
4303(b)(1)(A) of title 5, United States Code, before
the effective date of this section.
SEC. 304. AMENDMENTS TO INCENTIVE AWARDS AUTHOR-
ITY.
Chapter 45 of title 5, United States Code, is amend-
ed—
(1) by amending section 4501 to read as fol-
lows:
‘‘§ 4501. Definitions
‘‘For the purpose of this subchapter—
‘‘(1) the term ‘agency’ means—
‘‘(A) an Executive agency;
‘‘(B) the Library of Congress;
‘‘(C) the Office of the Architect of the
Capitol;
‘‘(D) the Botanic Garden;
‘‘(E) the Government Printing Office; and
‘‘(F) the United States Sentencing Com-
mission;
but does not include—
‘‘(i) the Tennessee Valley Authority; or
‘‘(ii) the Central Bank for Cooperatives;
‘‘(2) the term ‘employee’ means an employee as
defined by section 2105; and
‘‘(3) the term ‘Government’ means the Govern-
ment of the United States.’’; and
(2) by amending section 4503 to read as fol-
lows:
‘‘§ 4503. Agency awards
‘‘(a) The head of an agency may pay a cash award
to, and incur necessary expense for the honorary recogni-
tion of, an employee who—
‘‘(1) by his suggestion, invention, superior ac-
complishment, sustained superior performance, or
other personal effort contributes to the efficiency,
economy, or other improvement of Government oper-
ations or achieves a significant reduction in paper-
work; or
‘‘(2) performs a special act or service in the
public interest in connection with or related to his
official employment.
‘‘(b)(1) If the criteria under paragraph (1) or (2) of
subsection (a) are met on the basis of the suggestion, in-
vention, superior accomplishment, act, service, or other
meritorious effort of a group of employees collectively, and
if the circumstances so warrant (such as by reason of the
infeasibility of determining the relative role or contribution
assignable to each employee separately), authority under
subsection (a) may be exercised—
‘‘(A) based on the collective efforts of the
group; and
‘‘(B) with respect to each member of such
group.
‘‘(2) The amount awarded to each member of a group
under this subsection—
‘‘(A) shall be the same for all members of such
group; and
‘‘(B) may not exceed the maximum cash award
allowable under subsection (a) or (b) of section
4502, as applicable.’’.
SEC. 305. DUE PROCESS RIGHTS OF MANAGERS UNDER NE-
GOTIATED GRIEVANCE PROCEDURES.
(a) IN GENERAL.—Paragraph (2) of section 7121(b)
of title 5, United States Code, is amended to read as fol-
lows:
‘‘(2) The provisions of a negotiated grievance proce-
dure providing for binding arbitration in accordance with
paragraph (1)(C)(iii) shall, if or to the extent that an al-
leged prohibited personnel practice is involved, allow the
arbitrator to order a stay of any personnel action in a
manner similar to the manner described in section 1221(c)
with respect to the Merit Systems Protection Board.’’.
(b) EFFECTIVE DATE.—The amendment made by
subsection (a)—
(1) shall take effect on the date of the enact-
ment of this Act; and
(2) shall apply with respect to orders issued on
or after the date of the enactment of this Act, not-
withstanding the provisions of any collective bargain-
ing agreement.
SEC. 306. COLLECTION AND REPORTING OF TRAINING IN-
FORMATION.
(a) TRAINING WITHIN GOVERNMENT.—The Office of
Personnel Management shall collect information concern-
ing training programs, plans, and methods utilized by
agencies of the Government and submit a report to the
Congress on this activity on an annual basis.
(b) TRAINING OUTSIDE OF GOVERNMENT.—The Of-
fice of Personnel Management, to the extent it considers
appropriate in the public interest, may collect information
concerning training programs, plans, and methods utilized
outside the Government. The Office, on request, may
make such information available to an agency and to Con-
gress.
TITLE 
IV—ENHANCEMENT 
OF
THRIFT SAVINGS PLAN AND
CERTAIN OTHER BENEFITS
Subtitle A—Additional Investment
Funds for the Thrift Savings Plan
SEC. 401. SHORT TITLE.
This subtitle may be cited as the ‘‘Thrift Savings In-
vestment Funds Act of 1996’’.
SEC. 402. ADDITIONAL INVESTMENT FUNDS FOR THE
THRIFT SAVINGS PLAN.
Section 8438 of title 5, United States Code, is
amended—
(1) in subsection (a)—
(A) 
by 
redesignating 
paragraphs 
(5)
through (8) as paragraphs (6) through (9), re-
spectively;
(B) by inserting after paragraph (4) the
following new paragraph:
‘‘(5) the term ‘International Stock Index Invest-
ment Fund’ means the International Stock Index In-
vestment 
Fund 
established 
under 
subsection
(b)(1)(E);’’;
(C) in paragraph (8) (as redesignated by
subparagraph (A) of this paragraph) by strik-
ing out ‘‘and’’ at the end thereof;
(D) in paragraph (9) (as redesignated by
subparagraph (A) of this paragraph)—
(i) 
by 
striking 
out 
‘‘paragraph
(7)(D)’’ in each place it appears and in-
serting in each such place ‘‘paragraph
(8)(D)’’; and
(ii) by striking out the period and in-
serting in lieu thereof a semicolon and
‘‘and’’; and
(E) by adding at the end thereof the fol-
lowing new paragraph:
‘‘(10) the term ‘Small Capitalization Stock
Index Investment Fund’ means the Small Capitaliza-
tion Stock Index Investment Fund established under
subsection (b)(1)(D).’’; and
(2) in subsection (b)—
(A) in paragraph (1)—
(i) in subparagraph (B) by striking
out ‘‘and’’ at the end thereof;
(ii) in subparagraph (C) by striking
out the period and inserting in lieu thereof
a semicolon; and
(iii) by adding at the end thereof the
following new subparagraphs:
‘‘(D) a Small Capitalization Stock Index
Investment Fund as provided in paragraph (3);
and
‘‘(E) an International Stock Index Invest-
ment Fund as provided in paragraph (4).’’; and
(B) by adding at the end thereof the fol-
lowing new paragraphs:
‘‘(3)(A) The Board shall select an index which is a
commonly recognized index comprised of common stock
the aggregate market value of which represents the United
States equity markets excluding the common stocks in-
cluded in the Common Stock Index Investment Fund.
‘‘(B) The Small Capitalization Stock Index Invest-
ment Fund shall be invested in a portfolio designed to rep-
licate the performance of the index in subparagraph (A).
The portfolio shall be designed such that, to the extent
practicable, the percentage of the Small Capitalization
Stock Index Investment Fund that is invested in each
stock is the same as the percentage determined by dividing
the aggregate market value of all shares of that stock by
the aggregate market value of all shares of all stocks in-
cluded in such index.
‘‘(4)(A) The Board shall select an index which is a
commonly recognized index comprised of stock the aggre-
gate market value of which is a reasonably complete rep-
resentation of the international equity markets excluding
the United States equity markets.
‘‘(B) The International Stock Index Investment Fund
shall be invested in a portfolio designed to replicate the
performance of the index in subparagraph (A). The port-
folio shall be designed such that, to the extent practicable,
the percentage of the International Stock Index Invest-
ment Fund that is invested in each stock is the same as
the percentage determined by dividing the aggregate mar-
ket value of all shares of that stock by the aggregate mar-
ket value of all shares of all stocks included in such
index.’’.
SEC. 403. ACKNOWLEDGEMENT OF INVESTMENT RISK.
Section 8439(d) of title 5, United States Code, is
amended by striking out ‘‘Each employee, Member, former
employee, or former Member who elects to invest in the
Common Stock Index Investment Fund or the Fixed In-
come Investment Fund described in paragraphs (1) and
(3),’’ and inserting in lieu thereof ‘‘Each employee, Mem-
ber, former employee, or former Member who elects to in-
vest in the Common Stock Index Investment Fund, the
Fixed Income Investment Fund, the International Stock
Index Investment Fund, or the Small Capitalization Stock
Index Investment Fund, defined in paragraphs (1), (3),
(5), and (10),’’.
SEC. 404. EFFECTIVE DATE.
This subtitle shall take effect on the date of enact-
ment of this Act, and the Funds established under this
subtitle shall be offered for investment at the earliest prac-
ticable election period (described in section 8432(b) of title
5, United States Code) as determined by the Executive
Director in regulations.
Subtitle B—Thrift Savings Account
Liquidity
SEC. 411. SHORT TITLE.
This subtitle may be cited as the ‘‘Thrift Savings
Plan Act of 1996’’.
SEC. 412. NOTICE TO SPOUSES FOR IN-SERVICE WITHDRAW-
ALS; DE MINIMUS ACCOUNTS; CIVIL SERVICE
RETIREMENT SYSTEM PARTICIPANTS.
Section 8351(b) of title 5, United States Code, is
amended—
(1) in paragraph (5)—
(A) in subparagraph (B)—
(i) by striking out ‘‘An election,
change of election, or modification (relat-
ing to the commencement date of a de-
ferred annuity)’’ and inserting in lieu
thereof ‘‘An election or change of election’’;
(ii) by inserting ‘‘or withdrawal’’ after
‘‘and a loan’’;
(iii) by inserting ‘‘and (h)’’ after
‘‘8433(g)’’;
(iv) by striking out ‘‘the election,
change of election, or modification’’ and in-
serting in lieu thereof ‘‘the election or
change of election’’; and
(v) by inserting ‘‘or withdrawal’’ after
‘‘for such loan’’; and
(B) in subparagraph (D)—
(i) by inserting ‘‘or withdrawals’’ after
‘‘of loans’’; and
(ii) by inserting ‘‘or (h)’’ after
‘‘8433(g)’’; and
(2) in paragraph (6)—
(A) by striking out ‘‘$3,500 or less’’ and
inserting in lieu thereof ‘‘less than an amount
that the Executive Director prescribes by regu-
lation’’; and
(B) by striking out ‘‘unless the employee
or Member elects, at such time and otherwise in
such manner as the Executive Director pre-
scribes, one of the options available under sub-
section (b)’’.
SEC. 413. IN-SERVICE WITHDRAWALS; WITHDRAWAL ELEC-
TIONS, FEDERAL EMPLOYEES RETIREMENT
SYSTEM PARTICIPANTS.
(a) IN GENERAL.—Section 8433 of title 5, United
States Code, is amended—
(1) by striking out subsections (b) and (c) and
inserting in lieu thereof the following:
‘‘(b) Subject to section 8435 of this title, any em-
ployee or Member who separates from Government em-
ployment is entitled and may elect to withdraw from the
Thrift Savings Fund the balance of the employee’s or
Member’s account as—
‘‘(1) an annuity;
‘‘(2) a single payment;
‘‘(3) 2 or more substantially equal payments to
be made not less frequently than annually; or
‘‘(4) any combination of payments as provided
under paragraphs (1) through (3) as the Executive
Director may prescribe by regulation.
‘‘(c)(1) In addition to the right provided under sub-
section (b) to withdraw the balance of the account, an em-
ployee or Member who separates from Government service
and who has not made a withdrawal under subsection
(h)(1)(A) may make one withdrawal of any amount as a
single payment in accordance with subsection (b)(2) from
the employee’s or Member’s account.
‘‘(2) An employee or Member may request that the
amount withdrawn from the Thrift Savings Fund in ac-
cordance with subsection (b)(2) be transferred to an eligi-
ble retirement plan.
‘‘(3) The Executive Director shall make each transfer
elected under paragraph (2) directly to an eligible retire-
ment plan or plans (as defined in section 402(c)(8) of the
Internal Revenue Code of 1986) identified by the em-
ployee, Member, former employee, or former Member for
whom the transfer is made.
‘‘(4) A transfer may not be made for an employee,
Member, former employee, or former Member under para-
graph (2) until the Executive Director receives from that
individual the information required by the Executive Di-
rector specifically to identify the eligible retirement plan
or plans to which the transfer is to be made.’’;
(2) in subsection (d)—
(A) in paragraph (1) by striking out ‘‘Sub-
ject to paragraph (3)(A)’’ and inserting in lieu
thereof ‘‘Subject to paragraph (3)’’;
(B) by striking out paragraph (2) and re-
designating paragraph (3) as paragraph (2);
and
(C) in paragraph (2) (as redesignated
under subparagraph (B) of this paragraph)—
(i) in subparagraph (A) by striking
out ‘‘(A)’’; and
(ii) by striking out subparagraph (B);
(3) in subsection (f)(1)—
(A) by striking out ‘‘$3,500 or less’’ and
inserting in lieu thereof ‘‘less than an amount
that the Executive Director prescribes by regu-
lation; and
(B) by striking out ‘‘unless the employee
or Member elects, at such time and otherwise in
such manner as the Executive Director pre-
scribes, one of the options available under sub-
section (b), or’’ and inserting a comma;
(4) in subsection (f)(2)—
(A) by striking out ‘‘February 1’’ and in-
serting in lieu thereof ‘‘April 1’’;
(B) in subparagraph (A)—
(i) by striking out ‘‘65’’ and inserting
in lieu thereof ‘‘701⁄2’’; and
(ii) by inserting ‘‘or’’ after the semi-
colon;
(C) by striking out subparagraph (B); and
(D) by redesignating subparagraph (C) as
subparagraph (B);
(5) in subsection (g)—
(A) in paragraph (1) by striking out ‘‘after
December 31, 1987, and’’; and
(B) by striking out paragraph (2) and re-
designating paragraphs (3) through (5) as
paragraphs (2) through (4), respectively; and
(6) by adding after subsection (g) the following
new subsection:
‘‘(h)(1) An employee or Member may apply, before
separation, to the Board for permission to withdraw an
amount from the employee’s or Member’s account based
upon—
‘‘(A) the employee or Member having attained
age 591⁄2; or
‘‘(B) financial hardship.
‘‘(2) A withdrawal under paragraph (1)(A) shall be
available to each eligible participant one time only.
‘‘(3) A withdrawal under paragraph (1)(B) shall be
available only for an amount not exceeding the value of
that portion of such account which is attributable to con-
tributions made by the employee or Member under section
8432(a) of this title.
‘‘(4) Withdrawals under paragraph (1) shall be sub-
ject to such other conditions as the Executive Director
may prescribe by regulation.
‘‘(5) A withdrawal may not be made under this sub-
section unless the requirements of section 8435(e) of this
title are satisfied.’’.
(b) INVALIDITY OF CERTAIN PRIOR ELECTIONS.—
Any election made under section 8433(b)(2) of title 5,
United States Code (as in effect before the effective date
of this title), with respect to an annuity which has not
commenced before the implementation date of this title as
provided by regulation by the Executive Director in ac-
cordance with section 407, shall be invalid.
SEC. 414. SURVIVOR ANNUITIES FOR FORMER SPOUSES;
NOTICE TO FEDERAL EMPLOYEES RETIRE-
MENT SYSTEM SPOUSES FOR IN-SERVICE
WITHDRAWALS.
Section 8435 of title 5, United States Code, is
amended—
(1) in subsection (a)(1)(A)—
(A) by striking out ‘‘may make an election
under subsection (b)(3) or (b)(4) of section
8433 of this title or change an election pre-
viously made under subsection (b)(1) or (b)(2)
of such section’’ and inserting in lien thereof
‘‘may withdraw all or part of a Thrift Savings
Fund account under subsection (b) (2), (3), or
(4) of section 8433 of this title or change a
withdrawal election’’; and
(B) by adding at the end thereof ‘‘A mar-
ried employee or Member (or former employee
or Member) may make a withdrawal from a
Thrift Savings Fund account under subsection
(c)(1) of section 8433 of this title only if the
employee or Member (or former employee or
Member) satisfies the requirements of subpara-
graph (B).’’;
(2) in subsection (c)—
(A) in paragraph (1)—
(i) by striking out ‘‘An election,
change of election, or modification of the
commencement date of a deferred annuity’’
and inserting in lieu thereof ‘‘An election
or change of election’’; and
(ii) by striking out ‘‘modification, or
transfer’’ and inserting in lien thereof ‘‘or
transfer’’; and
(B) in paragraph (2) in the matter follow-
ing subparagraph (B)(ii) by striking out ‘‘modi-
fication,’’;
(3) in subsection (e)—
(A) in paragraph (1)—
(i) in subparagraph (A)—
(I) by inserting ‘‘or withdrawal’’
after ‘‘A loan’’;
(II) by inserting ‘‘and (h)’’ after
‘‘8433(g)’’; and
(III) by inserting ‘‘or with-
drawal’’ after ‘‘such loan’’;
(ii) in subparagraph (B) by inserting
‘‘or withdrawal’’ after ‘‘loan’’; and
(iii) in subparagraph (C)—
(I) by inserting ‘‘or withdrawal’’
after ‘‘to a loan’’; and
(II) by inserting ‘‘or withdrawal’’
after ‘‘for such loan’’; and
(B) in paragraph (2)—
(i) by inserting ‘‘or withdrawal’’ after
‘‘loan’’; and
(ii) by inserting ‘‘and (h)’’ after
‘‘8344(g)’’; and
(4) in subsection (g)—
(A) by inserting ‘‘or withdrawals’’ after
‘‘loans’’; and
(B) 
by 
inserting 
‘‘and 
(h)’’ 
after
‘‘8344(g)’’.
SEC. 415. DE MINIMUS ACCOUNTS RELATING TO THE JUDI-
CIARY.
(a) JUSTICES AND JUDGES.—Section 8440a(b)(7) of
title 5, United States Code, is amended—
(1) by striking out ‘‘$3,500 or less’’ and insert-
ing in lieu thereof ‘‘less than an amount that the
Executive Director prescribes by regulation’’; and
(2) by striking out ‘‘unless the justice or judge
elects, at such time and otherwise in such manner
as the Executive Director prescribes, one of the op-
tions available under section 8433(b)’’.
(b) BANKRUPTCY JUDGES AND MAGISTRATES.—Sec-
tion 8440b(b) of title 5, United States Code, is amended—
(1) in paragraph (7) in the first sentence by in-
serting ‘‘of the distribution’’ after ‘‘equal to the
amount’’; and
(2) in paragraph (8)—
(A) by striking out ‘‘$3,500 or less’’ and
inserting in lieu thereof ‘‘less than an amount
that the Executive Director prescribes by regu-
lation’’; and
(B) by striking out ‘‘unless the bankruptcy
judge or magistrate elects, at such time and
otherwise in such manner as the Executive Di-
rector prescribes, one of the options available
under subsection (b)’’.
(c) FEDERAL CLAIMS JUDGES.—Section 8440c(b) of
title 5, United States Code, is amended—
(1) in paragraph (7) in the first sentence by in-
serting ‘‘of the distribution’’ after ‘‘equal to the
amount’’; and
(2) in paragraph (8)—
(A) by striking out ‘‘$3,500 or less’’ and
inserting in lieu thereof ‘‘less than an amount
that the Executive Director prescribes by regu-
lation’’; and
(B) by striking out ‘‘unless the judge
elects, at such time and otherwise in such man-
ner as the Executive Director prescribes, one of
the options available under section 8433(b)’’.
SEC. 416. DEFINITION OF BASIC PAY.
(a) IN GENERAL.—(1) Section 8401(4) of title 5,
United States Code, is amended by striking out ‘‘except
as provided in subchapter III of this chapter,’’.
(2) Section 8431 of title 5, United States Code, is
repealed.
(b) TECHNICAL AND CONFORMING AMENDMENTS.—
(1) The table of sections for chapter 84 of title 5, United
States Code, is amended by striking out the item relating
to section 8431.
(2) Section 5545a(h)(2)(A) of title 5, United States
Code, is amended by striking out ‘‘8431,’’.
(3) Section 615(f) of the Treasury, Postal Service,
and General Government Appropriations Act, 1996 (Pub-
lic Law 104–52; 109 Stat. 500; 5 U.S.C. 5343 note) is
amended by striking out ‘‘section 8431 of title 5, United
States Code,’’.
SEC. 417. ELIGIBLE ROLLOVER DISTRIBUTIONS.
Section 8432 of title 5, United States Code, is
amended by adding at the end the following:
‘‘(j)(1) For the purpose of this subsection—
‘‘(A) the term ‘eligible rollover distribution’ has
the meaning given such term by section 402(c)(4) of
the Internal Revenue Code of 1986; and
‘‘(B) the term ‘qualified trust’ has the meaning
given such term by section 402(c)(8) of the Internal
Revenue Code of 1986.
‘‘(2) An employee or Member may contribute to the
Thrift Savings Fund an eligible rollover distribution from
a qualified trust. A contribution made under this sub-
section shall be made in the form described in section
401(a)(31) of the Internal Revenue Code of 1986. In the
case of an eligible rollover distribution, the maximum
amount transferred to the Thrift Savings Fund shall not
exceed the amount which would otherwise have been in-
cluded in the employee’s or Member’s gross income for
Federal income tax purposes.
‘‘(3) The Executive Director shall prescribe regula-
tions to carry out this subsection.’’.
SEC. 418. EFFECTIVE DATE.
This subtitle shall take effect on the date of the en-
actment of this Act and withdrawals and elections as pro-
vided under the amendments made by this subtitle shall
be made at the earliest practicable date as determined by
the Executive Director in regulations.
Subtitle C—Other Provisions
Relating to the Thrift Savings Plan
SEC. 421. PERCENTAGE LIMITATIONS ON CONTRIBUTIONS.
(a) AMENDMENTS RELATING TO FERS.—
(1) IN
GENERAL.—Subsection (a) of section
8432 of title 5, United States Code, is amended by
striking ‘‘10 percent of’’.
(2) JUSTICES AND JUDGES.—Subsection (b) of
section 8440a of title 5, United States Code, is
amended—
(A) by striking paragraph (2) and by re-
designating paragraphs (3) through (7) as
paragraphs (2) through (6), respectively; and
(B) in paragraph (6) (as so redesignated
by subparagraph (A)) by striking ‘‘paragraphs
(4) and (5)’’ and inserting ‘‘paragraphs (3) and
(4)’’.
(3) 
BANKRUPTCY
JUDGES
AND
MAG-
ISTRATES.—Subsection (b) of section 8440b of title
5, United States Code, is amended—
(A) by striking paragraph (2) and by re-
designating paragraphs (3) through (8) as
paragraphs (2) through (7), respectively;
(B) in paragraph (4) (as so redesignated
by subparagraph (A)) by striking ‘‘paragraph
(4)(A), (B), or (C)’’ and inserting ‘‘paragraph
(3)(A), (B), or (C)’’; and
(C) in paragraph (7) (as so redesignated
by subparagraph (A)) by striking ‘‘Notwith-
standing paragraph (4),’’ and inserting ‘‘Not-
withstanding paragraph (3),’’.
(4) COURT
OF
FEDERAL
CLAIMS
JUDGES.—
Subsection (b) of section 8440c of title 5, United
States Code, is amended—
(A) by striking paragraph (2) and by re-
designating paragraphs (3) through (8) as
paragraphs (2) through (7), respectively;
(B) in paragraph (4) (as so redesignated
by subparagraph (A)) by striking ‘‘paragraph
(4)(A) or (B)’’ and inserting ‘‘paragraph (3)(A)
or (B)’’; and
(C) in paragraph (7) (as so redesignated
by subparagraph (A)) by striking ‘‘Notwith-
standing paragraph (4),’’ and inserting ‘‘Not-
withstanding paragraph (3),’’.
(5) JUDGES OF THE UNITED STATES COURT OF
VETERANS
APPEALS.—Paragraph (2) of section
8440d(b) of title 5, United States Code, is amended
to read as follows:
‘‘(2) For purposes of contributions made to the Thrift
Savings Fund, basic pay does not include any retired pay
paid pursuant to section 7296 of title 38.’’.
(b) AMENDMENTS RELATING TO CSRS.—Paragraph
(2) of section 8351(b) of title 5, United States Code, is
amended by striking ‘‘5 percent of’’.
(c) EFFECTIVE DATE.—
(1) IN GENERAL.—The amendments made by
this section shall take effect 6 months after the date
of the enactment of this Act or such earlier date as
the Executive Director may by regulation prescribe.
(2) COORDINATION
WITH
ELECTION
PERI-
ODS.—The Executive Director shall by regulation
determine the first election period in which elections
may be made consistent with the amendments made
by this section.
(3) DEFINITIONS.—For purposes of this sub-
section—
(A) the term ‘‘election period’’ means a pe-
riod afforded under section 8432(b) of title 5,
United States Code; and
(B) the term ‘‘Executive Director’’ has the
meaning given such term by section 8401(13)
of title 5, United States Code.
SEC. 422. LOANS UNDER THE THRIFT SAVINGS PLAN FOR
FURLOUGHED EMPLOYEES.
Section 8433(g) of title 5, United States Code, is
amended by adding at the end the following:
‘‘(6) An employee who has been furloughed due to
a lapse in appropriations may not be denied a loan under
this subsection solely because such employee is not in a
pay status.’’.
SEC. 423. IMMEDIATE PARTICIPATION IN THE THRIFT SAV-
INGS PLAN.
(a) ELIMINATION OF CERTAIN WAITING PERIODS
FOR PURPOSES OF EMPLOYEE CONTRIBUTIONS.—Para-
graph (4) of section 8432(b) of title 5, United States
Code, is amended to read as follows:
‘‘(4) The Executive Director shall prescribe such reg-
ulations as may be necessary to carry out the following:
‘‘(A) Notwithstanding subparagraph (A) of
paragraph (2), an employee or Member described in
such subparagraph shall be afforded a reasonable
opportunity to first make an election under this sub-
section beginning on the date of commencing service
or, if that is not administratively feasible, beginning
on the earliest date thereafter that such an election
becomes administratively feasible, as determined by
the Executive Director.
‘‘(B) An employee or Member described in sub-
paragraph (B) of paragraph (2) shall be afforded a
reasonable opportunity to first make an election
under this subsection (based on the appointment or
election described in such subparagraph) beginning
on the date of commencing service pursuant to such
appointment or election or, if that is not administra-
tively feasible, beginning on the earliest date there-
after that such an election becomes administratively
feasible, as determined by the Executive Director.
‘‘(C) Notwithstanding the preceding provisions
of this paragraph, contributions under paragraphs
(1) and (2) of subsection (c) shall not be payable
with respect to any pay period before the earliest
pay period for which such contributions would other-
wise be allowable under this subsection if this para-
graph had not been enacted.
‘‘(D) 
Sections 
8351(a)(2), 
8440a(a)(2),
8440b(a)(2), 8440c(a)(2), and 8440d(a)(2) shall be
applied in a manner consistent with the purposes of
subparagraphs (A) and (B), to the extent those sub-
paragraphs can be applied with respect thereto.
‘‘(E) Nothing in this paragraph shall affect
paragraph (3).’’.
(b) TECHNICAL AND CONFORMING AMENDMENTS.—
(1) Section 8432(a) of title 5, United States Code, is
amended—
(A) in the first sentence by striking ‘‘(b)(1)’’
and inserting ‘‘(b)’’; and
(B) by amending the second sentence to read as
follows: ‘‘Contributions under this subsection pursu-
ant to such an election shall, with respect to each
pay period for which such election remains in effect,
be made in accordance with a program of regular
contributions provided in regulations prescribed by
the Executive Director.’’.
(2) Section 8432(b)(1)(B) of such title is amended
by inserting ‘‘(or any election allowable by virtue of para-
graph (4))’’ after ‘‘subparagraph (A)’’.
(3) Section 8432(b)(3) of such title is amended by
striking ‘‘Notwithstanding paragraph (2)(A), an’’ and in-
serting ‘‘An’’.
(4) Section 8432(i)(1)(B)(ii) of such title is amended
by striking ‘‘either elected to terminate individual con-
tributions to the Thrift Savings Fund within 2 months
before commencing military service or’’.
(5) Section 8439(a)(1) of such title is amended by
inserting ‘‘who makes contributions or’’ after ‘‘for each
individual’’ and by striking ‘‘section 8432(c)(1)’’ and in-
serting ‘‘section 8432’’.
(6) Section 8439(c)(2) of such title is amended by
adding at the end the following: ‘‘Nothing in this para-
graph shall be considered to limit the dissemination of in-
formation only to the times required under the preceding
sentence.’’.
(7) Sections 8440a(a)(2) and 8440d(a)(2) of such
title are amended by striking all after ‘‘subject to’’ and
inserting ‘‘subject to this chapter.’’.
(c) EFFECTIVE DATE.—This section shall take effect
6 months after the date of the enactment of this Act or
such earlier date as the Executive Director (within the
meaning of section 8401(13) of title 5, United States
Code) may by regulation prescribe.
Subtitle D—Resumption of Certain
Survivor Annuities That Termi-
nated by Reason of Marriage
SEC. 431. RESUMPTION OF CERTAIN SURVIVOR ANNUITIES
THAT TERMINATED BY REASON OF MAR-
RIAGE.
(a) CIVIL SERVICE RETIREMENT SYSTEM.—Section
8341(e) of title 5, United States Code, is amended by add-
ing at the end the following:
‘‘(4) If the annuity of a child under this subchapter
terminates under paragraph (3)(E) because of marriage,
then, if such marriage ends (whether by death of the
spouse, divorce, or annulment), such annuity shall resume
on the first day of the month in which the marriage ends,
but only if—
‘‘(A) any lump sum paid is returned to the
Fund; and
‘‘(B) that individual is not otherwise ineligible
for such annuity.’’.
(b) FEDERAL EMPLOYEES’ RETIREMENT SYSTEM.—
Section 8443(b) of such title is amended by adding at the
end the following: ‘‘If the annuity of a child under this
subchapter terminates under subparagraph (E) because of
marriage, then, if such marriage ends (whether by death
of the spouse, divorce, or annulment), such annuity shall
resume on the first day of the month in which the mar-
riage ends, but only if any lump sum paid is returned to
the Fund, and that individual is not otherwise ineligible
for such annuity.’’.
(c) HEALTH BENEFITS PROGRAM.—Section 8908 of
title 5, United States Code, is amended by adding at the
end the following:
‘‘(d) An individual—
‘‘(1) whose survivor annuity under section
8341(e) is terminated, and then later restored under
paragraph (4) thereof, or
‘‘(2) whose survivor annuity under section
8443(b) is terminated, and then later restored under
the last sentence thereof,
may, under regulations prescribed by the Office, enroll in
a health benefits plan described by section 8903 or 8903a
if such individual was covered by any such plan imme-
diately before such annuity so terminated.’’.
(d) APPLICABILITY.—The amendments made by this
section shall apply with respect to any termination of mar-
riage taking effect before, on, or after the date of the en-
actment of this Act, except that no amount shall be pay-
able by reason of the amendments made by subsections
(a) and (b), respectively, except to the extent of any
amounts accruing for periods beginning on or after the
first day of the first month beginning on or after the later
of—
(1) the date of the enactment of this Act; or
(2) the date as of which termination of mar-
riage takes effect.
Subtitle E—Life Insurance Benefits
SEC. 441. DOMESTIC RELATIONS ORDERS.
(a) IN GENERAL.—Section 8705 of title 5, United
States Code, is amended—
(1) in subsection (a) by striking ‘‘(a) The’’ and
inserting ‘‘(a) Except as provided in subsection (e),
the’’; and
(2) by adding at the end the following:
‘‘(e)(1) Any amount which would otherwise be paid
to a person determined under the order of precedence
named by subsection (a) shall be paid (in whole or in part)
by the Office to another person if and to the extent ex-
pressly provided for in the terms of any court decree of
divorce, annulment, or legal separation, or the terms of
any court order or court-approved property settlement
agreement incident to any court decree of divorce, annul-
ment, or legal separation.
‘‘(2) For purposes of this subsection, a decree, order,
or agreement referred to in paragraph (1) shall not be
effective unless it is received, before the date of the cov-
ered employee’s death, by the employing agency or, if the
employee has separated from service, by the Office.
‘‘(3) A designation under this subsection with respect
to any person may not be changed except—
‘‘(A) with the written consent of such person, if
received as described in paragraph (2); or
‘‘(B) by modification of the decree, order, or
agreement, as the case may be, if received as de-
scribed in paragraph (2).
‘‘(4) The Office shall prescribe any regulations nec-
essary to carry out this subsection, including regulations
for the application of this subsection in the event that 2
or more decrees, orders, or agreements, are received with
respect to the same amount.’’.
(b) DIRECTED ASSIGNMENT.—Section 8706(e) of
title 5, United States Code, is amended—
(1) by striking ‘‘(e)’’ and inserting ‘‘(e)(1)’’;
and
(2) by adding at the end the following:
‘‘(2) A court decree of divorce, annulment, or legal
separation, or the terms of a court-approved property set-
tlement agreement incidental to any court decree of di-
vorce, annulment, or legal separation, may direct that an
insured employee or former employee make an irrevocable
assignment of the employee’s or former employee’s inci-
dents of ownership in insurance under this chapter (if
there is no previous assignment) to the person specified
in the court order or court-approved property settlement
agreement.’’.
SEC. 442. EXCEPTION FROM PROVISIONS REQUIRING RE-
DUCTION IN ADDITIONAL OPTIONAL LIFE IN-
SURANCE.
(a) IN GENERAL.—Subsection (c) of section 8714b
of title 5, United States Code, is amended by adding at
the end the following:
‘‘(3)(A) The amount of additional optional insurance
continued under paragraph (2) shall be continued, without
any reduction under the last two sentences thereof, if—
‘‘(i) at the time of retirement, there is in effect
a designation under section 8705 under which the
entire amount of such insurance would be paid to an
individual who is permanently disabled; and
‘‘(ii) an election under subsection (d)(3) on be-
half of such individual is made in timely fashion.
‘‘(B) Notwithstanding subparagraph (A), any reduc-
tion required under paragraph (2) shall be made if—
‘‘(i) the additional optional insurance is not in
fact paid in accordance with the designation under
section 8705, as in effect at the time of retirement;
‘‘(ii) the Office finds that adequate arrange-
ments have not been made to ensure that the insur-
ance provided under this section will be used only
for the care and support of the individual so des-
ignated; or
‘‘(iii) the election referred to in subparagraph
(A)(ii) terminates at any time before the death of
the individual who made such election.
‘‘(C) For purposes of this paragraph, the term ‘per-
manently disabled’ shall have the meaning given such term
under regulations which the Office shall prescribe based
on subparagraphs (A) and (C) of section 1614(a)(3) of
the Social Security Act, except that, in applying subpara-
graph (A) of such section for purposes of this subpara-
graph, ‘which can be expected to last permanently’ shall
be substituted for ‘which has lasted or can be expected
to last for a continuous period of not less than twelve
months’.’’.
(b) CONTINUED WITHHOLDINGS.—Subsection (d) of
such section 8714b is amended by adding at the end the
following:
‘‘(3)(A) To be eligible for unreduced additional op-
tional insurance under subsection (c)(3), the insured indi-
vidual shall be required to elect, at such time and in such
manner as the Office by regulation requires (including
procedures for demonstrating compliance with the require-
ments of subsection (c)(3)), to have the full cost thereof
continue to be withheld from the former employee’s annu-
ity or compensation, as the case may be, beginning as of
when such withholdings would otherwise cease under the
second sentence of paragraph (1).
‘‘(B) An election made by an insured individual under
subparagraph (A) (and withholdings pursuant thereto)
shall terminate in the event that—
‘‘(i) the insured individual—
‘‘(I) revokes such election; or
‘‘(II) makes any redesignation or other
change in the designation under section 8705
(as in effect at the time of retirement); or
‘‘(ii) the Office finds, upon the application of
the insured individual or on its own initiative, that
any of the requirements or conditions for unreduced
additional optional insurance under subsection (c)(3)
are, at any time, no longer met.’’.
(c) EFFECTIVE DATE.—
(1) IN GENERAL.—The amendments made by
this section shall take effect on the date of the en-
actment of this Act.
(2) ELECTION FOR CERTAIN INDIVIDUALS NOT
OTHERWISE
ELIGIBLE.—The Office of Personnel
Management shall prescribe regulations under which
an election under section 8714b(d)(3)(A) of title 5,
United States Code (as amended by this section)
may be made, within 1 year after the date of the en-
actment of this Act, by any individual not otherwise
eligible to make such an election, but only if such in-
dividual—
(A) separated from service on or after the
first day of the 50-month period ending on the
date of enactment of this Act; and
(B) would have been so eligible had the
amendments made by this section (and imple-
menting regulations) been in effect as of the in-
dividual’s separation date (or, if earlier, the last
day for making such an election based on that
separation).
(3) WITHHOLDINGS.—
(A) PROSPECTIVE EFFECT.—If an individ-
ual makes an election under paragraph (2),
withholdings under section 8714b(d)(3)(A) of
such title 5 shall thereafter be made from such
individual’s annuity or compensation, as the
case may be.
(B) EARLIER AMOUNTS.—If, pursuant to
such election, benefits are in fact paid in ac-
cordance with section 8714b(c)(3) of such title
5 upon the death of the insured individual, an
appropriate reduction (computed under regula-
tions prescribed by the Office) shall be made in
such benefits to reflect the withholdings that—
(i) were not made (before the com-
mencement of withholdings under subpara-
graph (A)) by reason of the cessation of
withholdings under the second sentence of
section 8714b(d)(1) of such title; but
(ii) would have been made had the
amendments made by this section (and im-
plementing regulations) been in effect as of
the time described in paragraph (2)(B).
(4) NOTICE.—The Office shall, by publication
in the Federal Register and such other methods as
it considers appropriate, notify current and former
Federal employees as to the enactment of this sec-
tion and any benefits for which they might be eligi-
ble pursuant thereto. Included as part of such notifi-
cation shall be a brief description of the procedures
for making an election under paragraph (2) and any
other information that the Office considers appro-
priate.
SEC. 403. TEMPORARY CONTINUATION OF FEDERAL EM-
PLOYEES’ LIFE INSURANCE.
Section 8706 of title 5, United States Code, is
amended by adding at the end the following:
‘‘(g)(1) Notwithstanding subsections (a) and (b) of
this section, an employee whose coverage under this chap-
ter would otherwise terminate due to a separation de-
scribed in paragraph (3) shall be eligible to continue basic
insurance coverage described in section 8704 in accord-
ance with this subsection and regulations the Office may
prescribe, if the employee arranges to pay currently into
the Employees Life Insurance Fund, through the former
employing agency or, if an annuitant, through the respon-
sible retirement system, an amount equal to the sum of—
‘‘(A) both employee and agency contributions
which would be payable if separation had not oc-
curred; plus
‘‘(B) an amount, determined under regulations
prescribed by the Office, to cover necessary adminis-
trative expenses, but not to exceed 2 percent of the
total amount under subparagraph (A).
‘‘(2) Continued coverage under this subsection may
not extend beyond the date which is 18 months after the
effective date of the separation which entitles a former em-
ployee to coverage under this subsection. Termination of
continued coverage under this subsection shall be subject
to provision for temporary extension of life insurance cov-
erage and for conversion to an individual policy of life in-
surance as provided by subsection (a). If an eligible em-
ployee does not make an election for purposes of this sub-
section, the employee’s insurance will terminate as pro-
vided by subsection (a).
‘‘(3)(A) This subsection shall apply to an employee
who, on or after the date of enactment of this subsection
and before the applicable date under subparagraph (B)—
‘‘(i) is involuntarily separated from a position
due to a reduction in force, or separates voluntarily
from a position the employing agency determines is
a 
‘surplus 
position’ 
as 
defined 
by 
section
8905(d)(4)(C); and
‘‘(ii) is insured for basic insurance under this
chapter on the date of separation.
‘‘(B) The applicable date under this subparagraph is
October 1, 1999, except that, for purposes of any involun-
tary separation referred to in subparagraph (A) with re-
spect to which appropriate specific notice is afforded to
the affected employee before October 1, 1999, the applica-
ble date under this subparagraph is February 1, 2000.’’.
TITLE V—REORGANIZATION
FLEXIBILITY
SEC. 501. VOLUNTARY REDUCTIONS IN FORCE.
Section 3502(f) of title 5, United States Code, is
amended to read as follows:
‘‘(f)(1) The head of an Executive agency or military
department may—
‘‘(A) separate from service any employee who
volunteers to be separated under this subparagraph
even though the employee is not otherwise subject to
separation due to a reduction in force; and
‘‘(B) for each employee voluntarily separated
under subparagraph (A), retain an employee in a
similar position who would otherwise be separated
due to a reduction in force.
‘‘(2) The separation of an employee under paragraph
(1)(A) shall be treated as an involuntary separation due
to a reduction in force, except for purposes of priority
placement programs and advance notice.
‘‘(3) An employee with critical knowledge and skills
(as defined by the head of the Executive agency or military
department concerned) may not participate in a voluntary
separation under paragraph (1)(A) if the agency or de-
partment head concerned determines that such participa-
tion would impair the performance of the mission of the
agency or department (as applicable).
‘‘(4) The regulations prescribed under this section
shall incorporate the authority provided in this subsection.
‘‘(5) No authority under paragraph (1) may be exer-
cised after September 30, 2001.’’.
SEC. 502. NONREIMBURSABLE DETAILS TO FEDERAL AGEN-
CIES BEFORE A REDUCTION IN FORCE.
(a) IN GENERAL.—Section 3341 of title 5, United
States Code, is amended to read as follows:
‘‘§ 3341. Details; within Executive agencies and mili-
tary departments; employees affected by
reduction in force
‘‘(a) The head of an Executive agency or military de-
partment may detail employees, except those required by
law to be engaged exclusively in some specific work, among
the bureaus and offices of the agency or department.
‘‘(b) The head of an Executive agency or military de-
partment may detail to duties in the same or another
agency or department, on a nonreimbursable basis, an em-
ployee who has been identified by the employing agency
as likely to be separated from the Federal service by re-
duction in force or who has received a specific notice of
separation by reduction in force.
‘‘(c)(1) Details under subsection (a)—
‘‘(A) may not be for periods exceeding 120
days; and
‘‘(B) may be renewed (1 or more times) by
written order of the head of the agency or depart-
ment, in each particular case, for periods not exceed-
ing 120 days each.
‘‘(2) Details under subsection (b)—
‘‘(A) may not be for periods exceeding 90 days;
and
‘‘(B) may not be renewed.
‘‘(d) The 120-day limitation under subsection (c)(1)
for details and renewals of details does not apply to the
Department of Defense in the case of a detail—
‘‘(1) made in connection with the closure or re-
alignment of a military installation pursuant to a
base closure law or an organizational restructuring
of the Department as part of a reduction in the size
of the armed forces or the civilian workforce of the
Department; and
‘‘(2) in which the position to which the em-
ployee is detailed is eliminated on or before the date
of the closure, realignment, or restructuring.
‘‘(e) For purposes of this section—
‘‘(1) the term ‘base closure law’ means—
‘‘(A) section 2687 of title 10;
‘‘(B) title II of the Defense Authorization
Amendments and Base Closure and Realign-
ment Act; and
‘‘(C) the Defense Base Closure and Re-
alignment Act of 1990; and
‘‘(2) the term ‘military installation’—
‘‘(A) in the case of an installation covered
by section 2687 of title 10, has the meaning
given such term in subsection (e)(1) of such
section;
‘‘(B) in the case of an installation covered
by the Act referred to in subparagraph (B) of
paragraph (1), has the meaning given such
term in section 209(6) of such Act; and
‘‘(C) in the case of an installation covered
by the Act referred to in subparagraph (C) of
paragraph (1), has the meaning given such
term in section 2910(4) of such Act.’’.
(b) CLERICAL AMENDMENT.—The table of sections
for chapter 33 of title 5, United States Code, is amended
by striking the item relating to section 3341 and inserting
the following:
‘‘3341. Details; within Executive agencies and military departments; employees
affected by reduction in force.’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall take effect 30 days after the date of the
enactment of this Act.
TITLE VI—SOFT-LANDING
PROVISIONS
SEC. 601. CONTINUED ELIGIBILITY FOR LIFE INSURANCE.
(a) IN GENERAL.—Section 8706 of title 5, United
States Code, is amended by redesignating subsections (d)
through (f) as subsections (e) through (g), respectively,
and by inserting after subsection (c) the following:
‘‘(d)(1) Notwithstanding subsection (b), any em-
ployee who, on or after the date of the enactment of this
subsection and before the applicable date under paragraph
(2)—
‘‘(A) is involuntarily separated from a position,
or voluntarily separated from a surplus position, in
or under an Executive agency due to a reduction in
force,
‘‘(B) based on the separation referred to in sub-
paragraph (A), retires on an immediate annuity
under subchapter III of chapter 83 or subchapter II
of chapter 84, but does not satisfy the requirements
of subsection (b)(1), and
‘‘(C) is insured on the date of separation,
may, within 60 days after the date of separation, elect to
continue such employee’s insurance and arrange to pay
currently into the Employees’ Life Insurance Fund both
the employee and agency contributions therefor, in accord-
ance with procedures prescribed by the Office. If the em-
ployee does not so elect, such employee’s insurance will
terminate as provided by subsection (a).
‘‘(2) The applicable date under this paragraph is Oc-
tober 1, 1999, except that, for purposes of any involuntary
separation referred to in paragraph (1)(A) with respect
to which appropriate specific notice is afforded to the af-
fected employee before October 1, 1999, the applicable
date under this paragraph is February 1, 2000.
‘‘(3) For purposes of this subsection, the term ‘sur-
plus position’, with respect to an agency, means any posi-
tion determined in accordance with regulations under sec-
tion 8905a(d)(4)(C) for such agency.’’.
(b) CONFORMING AMENDMENT.—Section 8706(g) of
title 5, United States Code, as so redesignated by sub-
section (a), is amended by striking ‘‘subsection (e)’’ and
inserting ‘‘subsection (f)’’.
SEC. 602. CONTINUED ELIGIBILITY FOR HEALTH INSUR-
ANCE.
(a) 
CONTINUED
ELIGIBILITY
AFTER
RETIRE-
MENT.—Section 8905 of title 5, United States Code, is
amended—
(1) in the first sentence of subsection (b) by
striking ‘‘An’’ and inserting ‘‘Subject to subsection
(g), an’’; and
(2) by adding at the end the following:
‘‘(g)(1) The Office shall waive the requirements for
continued enrollment under subsection (b) in the case of
any individual who, on or after the date of the enactment
of this subsection and before the applicable date under
paragraph (2)—
‘‘(A) is involuntarily separated from a position,
or voluntarily separated from a surplus position, in
or under an Executive agency due to a reduction in
force,
‘‘(B) based on the separation referred to in sub-
paragraph (A), retires on an immediate annuity
under subchapter III of chapter 83 or subchapter II
of chapter 84, and
‘‘(C) is enrolled in a health benefits plan under
this chapter as an employee immediately before re-
tirement.
‘‘(2) The applicable date under this paragraph is Oc-
tober 1, 1999, except that, for purposes of any involuntary
separation referred to in paragraph (1)(A) with respect
to which appropriate specific notice is afforded to the af-
fected employee before October 1, 1999, the applicable
date under this paragraph is February 1, 2000.
‘‘(3) For purposes of this subsection, the term ‘sur-
plus position’, with respect to an agency, means any posi-
tion determined in accordance with regulations under sec-
tion 8905a(d)(4)(C) for such agency.’’.
(b) TEMPORARY CONTINUED ELIGIBILITY AFTER
BEING
INVOLUNTARILY
SEPARATED.—Section
8905a(d)(4) of title 5, United States Code, is amended—
(1) in subparagraph (A) by striking ‘‘the De-
partment of Defense’’ and inserting ‘‘an Executive
agency’’; and
(2) by amending subparagraph (C) to read as
follows:
‘‘(C) For purposes of this paragraph, the term ‘sur-
plus position’ means a position that, as determined under
regulations prescribed by the head of the agency involved,
is identified during planning for a reduction in force as
being no longer required and is designated for elimination
during the reduction in force.’’.
SEC. 603. PRIORITY PLACEMENT PROGRAMS FOR FEDERAL
EMPLOYEES AFFECTED BY A REDUCTION IN
FORCE.
(a) IN GENERAL.—Subchapter I of chapter 33 of title
5, United States Code, is amended by adding at the end
the following:
‘‘§ 3330a. Priority placement programs for employees
affected by a reduction in force
‘‘(a) Not later than 3 months after the date of the
enactment of this section, each Executive agency shall es-
tablish an agencywide priority placement program, to fa-
cilitate employment placement for employees who—
‘‘(1) are scheduled to be separated from service
due to a reduction in force under—
‘‘(A) regulations prescribed under section
3502; or
‘‘(B) procedures established under section
3595;
‘‘(2) are separated from service due to such a
reduction in force; or
‘‘(3) have received a rating of at least fully suc-
cessful (or the equivalent) as the last performance
rating of record used for retention purposes (except
for employees in positions excluded from a perform-
ance appraisal system by law, regulation, or admin-
istrative action taken by the Office of Personnel
Management).
‘‘(b)(1) Each agencywide priority placement program
under this section shall include provisions under which a
vacant position shall not (except as provided in this sub-
section) be filled by the appointment or transfer of any
individual from outside of that agency (other than an indi-
vidual described in paragraph (2)) if—
‘‘(A) there is then available any individual de-
scribed in paragraph (2) who is qualified for the po-
sition; and
‘‘(B) the position—
‘‘(i) is at the same grade or pay level (or
the equivalent) or not more than 3 grades (or
grade intervals) below that of the position last
held by such individual before placement in the
new position;
‘‘(ii) is within the same commuting area as
the individual’s last-held position (as referred to
in clause (i)) or residence; and
‘‘(iii) has the same type of work schedule
(whether full-time, part-time, or intermittent)
as the position last held by the individual.
‘‘(2) For purposes of an agencywide priority place-
ment program, an individual shall be considered to be de-
scribed in this paragraph if such individual is—
‘‘(A) an employee of such agency who is sched-
uled to be separated, as described in subsection
(a)(1); or
‘‘(B) an individual who became a former em-
ployee of such agency as a result of a separation, as
described in subsection (a)(2).
‘‘(c)(1) If after a reduction in force the agency has
no positions of any type within the local commuting areas
specified in this section, the individual may designate a
different local commuting area where the agency has con-
tinuing positions in order to exercise reemployment rights
under this section. An agency may determine that such
designations are not in the interest of the Government for
the purpose of paying relocation expenses under sub-
chapter II of chapter 57.
‘‘(2) At its option, an agency may administratively
extend reemployment rights under this section to include
other local commuting areas.
‘‘(d)(1) In selecting employees for positions under
this section, the agency shall place qualified present and
former employees in retention order by veterans’ pref-
erence subgroup and tenure group.
‘‘(2) An agency may not pass over a qualified present
or former employee to select an individual in a lower veter-
ans’ preference subgroup within the tenure group, or in
a lower tenure group.
‘‘(3) Within a subgroup, the agency may select a
qualified present or former employee without regard to the
individual’s total creditable service.
‘‘(e) An individual is eligible for reemployment prior-
ity under this section for 2 years from the effective date
of the reduction in force from which the individual will
be, or has been, separated under section 3502.
‘‘(f) An individual qualified present or former em-
ployee loses eligibility for reemployment priority under this
section when the individual—
‘‘(1) requests removal in writing;
‘‘(2) accepts or declines a bona fide offer under
this section or fails to accept such an offer within
the period of time allowed for such acceptance, or
‘‘(3) separates from the agency before being
separated under section 3502.
A present or former employee who declines a position with
a representative rate (or equivalent) that is less than the
rate of the position from which the individual was sepa-
rated under section 3502 retains eligibility for positions
with a higher representative rate up to the rate of the indi-
vidual’s last position.
‘‘(g) Whenever more than one individual is qualified
for a position under this section, the agency shall select
the most highly qualified individual, subject to subsection
(d).
‘‘(h) The Office of Personnel Management shall issue
regulations to implement this section.’’.
(b) CLERICAL AMENDMENT.—The table of sections
for chapter 33 of title 5, United States Code, is amended
by adding after the item relating to the section 3330 the
following:
‘‘3330a.
Priority placement programs for employees affected by a reduction
in force.’’.
SEC. 604. JOB PLACEMENT AND COUNSELING SERVICES.
(a) AUTHORITY FOR SERVICES.—The head of each
Executive agency may establish a program to provide job
placement and counseling services to current and former
employees.
(b) TYPES OF SERVICES AUTHORIZED.—A program
established under this section may include such services
as—
(1) career and personal counseling;
(2) training in job search skills; and
(3) job placement assistance, including assist-
ance provided through cooperative arrangements
with State and local employment service offices.
(c) ELIGIBILITY FOR SERVICES.—Services authorized
by this section may be provided to—
(1) current employees of the agency or, with the
approval of such other agency, any other agency;
and
(2) employees of the agency or, with the ap-
proval of such other agency, any other agency who
have been separated for less than 1 year, if the sepa-
ration was not a removal for cause on charges of
misconduct or delinquency.
(d) REIMBURSEMENT
FOR COSTS.—The costs of
services provided to current or former employees of an-
other agency shall be reimbursed by that agency.
SEC. 605. EDUCATION AND RETRAINING INCENTIVES.
(a) NON-FEDERAL EMPLOYMENT INCENTIVE PAY-
MENTS.—
(1) DEFINITIONS.—For purposes of this sub-
section—
(A) the term ‘‘eligible employee’’ means an
employee who is involuntarily separated from a
position, or voluntarily separated from a sur-
plus position, in or under an Executive agency
due to a reduction in force, except that such
term does not include an employee who, at the
time of separation, meets the age and service
requirements for an immediate annuity under
subchapter III of chapter 83 or chapter 84 of
title 5, United States Code, other than under
section 8336(d) or 8414(b) of such title;
(B) the term ‘‘non-Federal employer’’
means an employer other than the Government
of the United States or any agency or other in-
strumentality thereof;
(C) the term ‘‘Executive agency’’ has the
meaning given such term by section 105 of title
5, United States Code; and
(D) the term ‘‘surplus position’’ has the
meaning 
given 
such 
term 
by 
section
8905(d)(4)(C) of title 5, United States Code.
(2) AUTHORITY.—The head of an Executive
agency may pay retraining and relocation incentive
payments, in accordance with this subsection, in
order to facilitate the reemployment of eligible em-
ployees who are separated from such agency.
(3) RETRAINING INCENTIVE PAYMENT.—
(A) AGREEMENT.—The head of an Execu-
tive agency may enter into an agreement with
a non-Federal employer under which the non-
Federal employer agrees—
(i) to employ an individual referred to
in paragraph (2) for at least 12 months
for a salary which is mutually agreeable to
the employer and such individual; and
(ii) to certify to the agency head any
costs incurred by the employer for any nec-
essary training provided to such individual
in connection with the employment by such
employer.
(B) PAYMENT OF RETRAINING INCENTIVE
PAYMENT.—The agency head shall pay a re-
training incentive payment to the non-Federal
employer upon the employee’s completion of 12
months of continuous employment by that em-
ployer. The agency head shall prescribe the
amount of the incentive payment.
(C) PRORATION RULE.—The agency head
shall pay a prorated amount of the full retrain-
ing incentive payment to the non-Federal em-
ployer for an employee who does not remain
employed by the non-Federal employer for at
least 12 months, but only if the employee re-
mains so employed for at least 6 months.
(D) LIMITATION.—In no event may the
amount of the retraining incentive payment
paid for the training of any individual exceed
the amount certified for such individual under
subparagraph (A), subject to subsection (c).
(4) RELOCATION
INCENTIVE
PAYMENT.—The
head of an agency may pay a relocation incentive
payment to an eligible employee if it is necessary for
the employee to relocate in order to commence em-
ployment with a non-Federal employer. Subject to
subsection (e), the amount of the incentive payment
shall not exceed the amount that would be payable
for travel, transportation, and subsistence expenses
under subchapter II of chapter 57 of title 5, United
States Code, including any reimbursement author-
ized under section 5724b of such title, to a Federal
employee who transfers between the same locations
as the individual to whom the incentive payment is
payable.
(5) DURATION.—No incentive payment may be
paid for training or relocation commencing after
June 30, 2000.
(6) SOURCE.—An incentive payment under this
subsection shall be payable from appropriations or
other funds available to the agency for purposes of
training (within the meaning of section 4101(4) of
title 5, United States Code).
(b) EDUCATIONAL ASSISTANCE.—
(1) IN GENERAL.—Under regulations prescribed
by the Office of Personnel Management, all or any
part of the amount described in subsection (c) may
be afforded to any employee described in paragraph
(2) in the form of educational assistance.
(2) ELIGIBLE EMPLOYEE.—An individual shall
not be eligible for educational assistance under this
subsection unless such individual—
(A) is an eligible employee, within the
meaning of subsection (a); and
(B) has completed at least 3 years of cur-
rent continuous service in any Executive agency
or agencies.
(c) AGGREGATE LIMITATION.—No incentive payment
or other amount may be paid under this section to or on
behalf of any individual to the extent that such amount
would cause the aggregate amount otherwise paid or pay-
able under this section, to or on behalf of such individual,
to exceed $10,000.
TITLE VII—MISCELLANEOUS
SEC. 701. REIMBURSEMENTS RELATING TO PROFESSIONAL
LIABILITY INSURANCE.
(a) AUTHORITY.—Notwithstanding any other provi-
sion of law, any amounts appropriated, for fiscal year
1997 or any fiscal year thereafter, for salaries and ex-
penses of Government employees may be used to reim-
burse any qualified employee for not to exceed one-half
the costs incurred by such employee for professional liabil-
ity insurance. A payment under this section shall be con-
tingent upon the submission of such information or docu-
mentation as the employing agency may require.
(b) QUALIFIED EMPLOYEE.—For purposes of this
section, the term ‘‘qualified employee’’ means—
(1) an agency employee whose position is that
of a law enforcement officer;
(2) an agency employee whose position is that
of a supervisor or management official; or
(3) such other employee as the head of the
agency considers appropriate
(c) DEFINITIONS.—For purposes of this section—
(1) the term ‘‘agency’’ means an Executive
agency, as defined by section 105 of title 5, United
States Code;
(2) the term ‘‘law enforcement officer’’ means
an employee, the duties of whose position are pri-
marily the investigation, apprehension, prosecution,
or detention of individuals suspected or convicted of
offenses against the criminal laws of the United
States, including any law enforcement officer under
section 8331(20) or 8401(17) of such title 5;
(3) the terms ‘‘supervisor’’ and ‘‘management
official’’ have the respective meanings given them by
section 7103(a) of such title 5; and
(4) the term ‘‘professional liability insurance’’
means insurance which provides coverage for—
(A) legal liability for damages due to inju-
ries to other persons, damage to their property,
or other damage or loss to such other persons
(including the expenses of litigation and settle-
ment) resulting from or arising out of any
tortious act, error, or omission of the covered
individual (whether common law, statutory, or
constitutional) while in the performance of such
individual’s official duties as a qualified em-
ployee; and
(B) the cost of legal representation for the
covered individual in connection with any ad-
ministrative or judicial proceeding (including
any investigation or disciplinary proceeding) re-
lating to any act, error, or omission of the cov-
ered individual while in the performance of such
individual’s official duties as a qualified em-
ployee, and other legal costs and fees relating
to any such administrative or judicial proceed-
ing.
SEC. 702. EMPLOYMENT RIGHTS FOLLOWING CONVERSION
TO CONTRACT.
(a) IN GENERAL.—An employee whose position is
abolished because an activity performed by an Executive
agency (within the meaning of section 105 of title 5, Unit-
ed States Code, is converted to contract shall receive from
the contractor an offer in good faith of a right of first
refusal of employment under the contract for a position
for which the employee is deemed qualified based upon
previous knowledge, skills, abilities, and experience. The
contractor shall not offer employment under the contract
to any person prior to having complied fully with this obli-
gation, except as provided in subsection (b), or unless no
employee whose position is abolished because such activity
has been converted to contract can demonstrate appro-
priate qualifications for the position.
(b) EXCEPTION.—Notwithstanding the contractor’s
obligation under subsection (a), the contractor is not re-
quired to offer a right of first refusal to any employee who,
in the 12 months preceding conversion to contract, has
been the subject of an adverse personnel action related to
misconduct or has received a less than fully successful per-
formance rating.
(c) LIMITATION.—No employee shall have a right to
more than 1 offer under this section based on any particu-
lar separation due to the conversion of an activity to con-
tract.
(d) REGULATIONS.—Regulations to carry out this
section may be prescribed by the President.
SEC. 703. DEBARMENT OF HEALTH CARE PROVIDERS
FOUND TO HAVE ENGAGED IN FRAUDULENT
PRACTICES.
(a) IN GENERAL.—Section 8902a of title 5, United
States Code, is amended—
(1) in subsection (a)(2)(A) by striking ‘‘sub-
section (b) or (c)’’ and inserting ‘‘subsection (b), (c),
or (d)’’;
(2) in subsection (b)—
(A) by striking ‘‘may’’ and inserting
‘‘shall’’ in the matter before paragraph (1); and
(B) by amending paragraph (5) to read as
follows:
‘‘(5) Any provider that is currently suspended
or excluded from participation under any program of
the Federal Government involving procurement or
nonprocurement activities.’’;
(3) by redesignating subsections (c) through (i)
as subsections (d) through (j), respectively, and by
inserting after subsection (b) the following:
‘‘(c) The Office may bar the following providers of
health care services from participating in the program
under this chapter:
‘‘(1) Any provider—
‘‘(A) whose license to provide health care
services or supplies has been revoked, sus-
pended, restricted, or not renewed, by a State
licensing authority for reasons relating to the
provider’s professional competence, professional
performance, or financial integrity; or
‘‘(B) that surrendered such a license while
a formal disciplinary proceeding was pending
before such an authority, if the proceeding con-
cerned the provider’s professional competence,
professional performance, or financial integrity.
‘‘(2) Any provider that is an entity directly or
indirectly owned, or with a 5 percent or more con-
trolling interest, by an individual who is convicted of
any offense described in subsection (b), against
whom a civil monetary penalty has been assessed
under subsection (d), or who has been excluded from
participation under this chapter.
‘‘(3) Any provider that the Office determines, in
connection with claims presented under this chapter,
has charged for health care services or supplies in
an amount substantially in excess of such provider’s
customary charges for such services or supplies (un-
less the Office finds there is good cause for such
charge), or charged for health care services or sup-
plies which are substantially in excess of the needs
of the covered individual or which are of a quality
that fails to meet professionally recognized stand-
ards for such services or supplies.
‘‘(4) Any provider that the Office determines
has committed acts described in subsection (d).’’;
(4) in subsection (d), as so redesignated by
paragraph (3), by amending paragraph (1) to read
as follows:
‘‘(1) in connection with claims presented under
this chapter, that a provider has charged for a
health care service or supply which the provider
knows or should have known involves—
‘‘(A) an item or service not provided as
claimed;
‘‘(B) charges in violation of applicable
charge limitations under section 8904(b); or
‘‘(C) an item or service furnished during a
period in which the provider was excluded from
participation under this chapter pursuant to a
determination by the Office under this section,
other than as permitted under subsection
(g)(2)(B);’’;
(5) in subsection (f), as so redesignated by
paragraph (3), by inserting ‘‘(where such debarment
is not mandatory),’’ after ‘‘under this section’’ the
first place it appears;
(6) in subsection (g), as so redesignated by
paragraph (3)—
(A) by striking ‘‘(g)(1)’’ and all that fol-
lows through the end of paragraph (1) and in-
serting the following:
‘‘(g)(1)(A) Except as provided in subparagraph (B),
debarment of a provider under subsection (b) or (c) shall
be effective at such time and upon such reasonable notice
to such provider, and to carriers and covered individuals,
as shall be specified in regulations prescribed by the Of-
fice. Any such provider that is excluded from participation
may request a hearing in accordance with subsection
(h)(1).
‘‘(B) Unless the Office determines that the health or
safety of individuals receiving health care services war-
rants an earlier effective date, the Office shall not make
a determination adverse to a provider under subsection
(c)(4) or (d) until such provider has been given reasonable
notice and an opportunity for the determination to be
made after a hearing as provided in accordance with sub-
section (h)(1).’’;
(B) in paragraph (3)—
(i) by inserting ‘‘of debarment’’ after
‘‘notice’’; and
(ii) by adding at the end the follow-
ing: ‘‘In the case of a debarment under
paragraphs (1) through (4) of subsection
(b), the minimum period of exclusion shall
not be less than 3 years, except as pro-
vided in paragraph (4)(B)(ii).’’; and
(C) in paragraph (4)(B)(i)(I) by striking
‘‘subsection (b) or (c)’’ and inserting ‘‘sub-
section (b), (c), or (d)’’;
(7) in subsection (h)—
(A) by striking ‘‘(h)(1)’’ and all that fol-
lows through the end of paragraph (2) and in-
serting the following:
‘‘(h)(1) Any provider of health care services or sup-
plies that is the subject of an adverse determination by
the Office under this section shall be entitled to reasonable
notice and an opportunity to request a hearing of record,
and to judicial review as provided in this subsection after
the Office renders a final decision. The Office shall grant
a request for a hearing upon a showing that due process
rights have not previously been afforded with respect to
any finding of fact which is relied upon as a cause for
an adverse determination under this section. Such hearing
shall be conducted without regard to subchapter II of
chapter 5 and chapter 7 of this title by a hearing officer
who shall be designated by the Director of the Office and
who shall not otherwise have been involved in the adverse
determination being appealed. A request for a hearing
under this subsection must be filed within such period and
in accordance with such procedures as the Office shall pre-
scribe by regulation.
‘‘(2) Any provider adversely affected by a final deci-
sion under paragraph (1) made after a hearing to which
such provider was a party may seek review of such deci-
sion in the United States District Court for the District
of Columbia or for the district in which the plaintiff re-
sides or has his principal place of business by filing a no-
tice of appeal in such court within 60 days from the date
the decision is issued and simultaneously sending copies
of such notice by certified mail to the Director of the Of-
fice and to the Attorney General. In answer to the appeal,
the Director of the Office shall promptly file in such court
a certified copy of the transcript of the record, if the Office
conducted a hearing, and other evidence upon which the
findings and decision complained of are based. The court
shall have power to enter, upon the pleadings and evidence
of record, a judgment affirming, modifying, or setting
aside, in whole or in part, the decision of the Office, with
or without remanding the cause for a rehearing. The dis-
trict court shall not set aside or remand the decision of
the Office unless there is not substantial evidence on the
record, taken as a whole, to support the findings by the
Office of a cause for action under this section or unless
action taken by the Office constitutes an abuse of discre-
tion.’’; and
(8) in subsection (i), as so redesignated by
paragraph (3)—
(A) by striking ‘‘subsection (c)’’ and in-
serting ‘‘subsection (d)’’; and
(B) by adding at the end the following:
‘‘The amount of a penalty or assessment as fi-
nally determined by the Office, or other amount
the Office may agree to in compromise, may be
deducted from any sum then or later owing by
the United States to the party against whom
the penalty or assessment has been levied.’’.
(b) EFFECTIVE DATE.—
(1) IN GENERAL.—Except as provided in para-
graph (2), this section shall take effect on the date
of the enactment of this Act.
(2) EXCEPTIONS.—(A) Paragraphs (2) and (4)
of section 8902a(c) of title 5, United States Code,
as amended by subsection (a), shall apply only to the
extent that the misconduct which is the basis for de-
barment thereunder occurs after the date of the en-
actment of this Act.
(B) Section 8902a(d)(1)(B) of title 5, United
States Code, as amended by subsection (a), shall
apply only with respect to charges which violate sec-
tion 8904(b) of such title 5 for items and services
furnished after the date of the enactment of this
Act.
(C) Section 8902a(g)(3) of title 5, United
States Code, as amended by subsection (a), shall
apply only with respect to debarments based on con-
victions occurring after the date of the enactment of
this Act.
SEC. 704. EXTENSION OF CERTAIN PROCEDURAL AND AP-
PEAL RIGHTS TO CERTAIN PERSONNEL OF
THE FEDERAL BUREAU OF INVESTIGATION.
(a) IN GENERAL.—Section 7511(b)(8) of title 5,
United States Code, is amended by striking ‘‘the Federal
Bureau of Investigation,’’.
(b) EFFECTIVE DATE.—The amendment made by
this section shall apply with respect to any personnel ac-
tion taking effect after the end of the 45-day period begin-
ning on the date of the enactment of this Act.
SEC. 705. CONVERSION OF CERTAIN EXCEPTED SERVICE
POSITIONS IN THE UNITED STATES FIRE AD-
MINISTRATION TO COMPETITIVE SERVICE
POSITIONS.
(a) IN GENERAL.—No later than the date described
under subsection (d)(1), the Director of the Federal
Emergency Management Agency and the Director of the
Office of Personnel Management shall take such actions
as necessary to convert each excepted service position es-
tablished before the date of the enactment of this Act
under section 7(c)(4) of the Federal Fire Prevention and
Control Act of 1974 (15 U.S.C. 2206(c)(4)) to a competi-
tive service position.
(b) EFFECT
ON EMPLOYEES.—Any employee em-
ployed on the date of the enactment of this Act in an ex-
cepted service position converted under subsection (a)—
(1) shall remain employed in the competitive
service position so converted without a break in serv-
ice;
(2) by reason of such conversion, shall have
no—
(A) diminution of seniority;
(B) reduction of cumulative years of serv-
ice; and
(C) requirement to serve an additional pro-
bationary period applied; and
(3) shall retain their standing and participation
with respect to chapter 83 or 84 of title 5, United
States Code, relating to Federal retirement.
(c) PROSPECTIVE
COMPETITIVE
SERVICE
POSI-
TIONS.—Section 7(c)(4) of the Federal Fire Prevention
and Control Act of 1974 (15 U.S.C. 2206(c)(4)) is amend-
ed to read as follows:
‘‘(4) appoint faculty members to competitive
service positions and with respect to temporary and
intermittent services, to make appointments of con-
sultants to the same extent as is authorized by sec-
tion 3109 of title 5, United States Code;’’.
(d) EFFECTIVE DATE.—(1) Except as provided
under paragraph (2), this section shall take effect on the
first day of the first pay period, applicable to the positions
described under subsection (a), beginning after the date
of the enactment of this Act.
(2)(A) The Director of the Federal Emergency Man-
agement Agency and the Director of the Office of Person-
nel Management shall take such actions as directed under
subsection (a) on and after the date of the enactment of
this Act.
(B) Subsection (c) shall take effect on the date of
the enactment of this Act.
SEC. 706. ELIGIBILITY FOR CERTAIN SURVIVOR ANNUITY
BENEFITS.
For the purpose of determining eligibility for survivor
annuity benefits for a former spouse under section 8341
of title 5, United States Code, an application of any
former spouse shall be approved if—
(1) the annuitant is deceased;
(2) the former spouse was living as of January
1, 1992;
(3) the former spouse has not received Social
Security benefits based on eligibility as the spouse of
the annuitant;
(4) such application was filed on or after Janu-
ary 1, 1989;
(5) the annuitant rendered at least 25 years of
creditable service to the Federal Government;
(6) at the time of the annuitant’s retirement,
the annuitant and the former spouse had been mar-
ried at least 25 years;
(7) at the time of the annuitant’s retirement,
the annuitant designated the former spouse to re-
ceive survivor annuity benefits;
(8) the annuitant and the former spouse were
divorced prior to September 14, 1978, and after the
annuitant retired;
(9) neither at the time of the divorce nor at any
time thereafter was a joint waiver of survivor annu-
ity benefits executed between the annuitant and the
former spouse;
(10) the divorce decree was silent as to survivor
annuity benefits or designated the former spouse to
receive survivor annuity benefits;
(11) subsequent to the divorce of the annuitant
and the former spouse, the annuitant advised the
Office of Personnel Management of the divorce;
(12) neither the annuitant nor the former
spouse married any other individual after their di-
vorce from each other;
(13) no direct notice outlining or defining the
former spouse’s survivor annuity benefits election
rights was delivered to the former spouse by the Of-
fice of Personnel Management; and
(14) the former spouse has exhausted all judi-
cial remedies up to and including remedies available
through the United States Court of Appeals.
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