Federal Employees' Retirement System Act of 1986
PL 99-335 (H.R.2672), enacted 06/06/1986

100 STAT. 514 
PUBLIC LAW 99-335—JUNE 6, 1986 
Public Law 99-
99th Congress 
•335 
An Act 
June 6, 1986 
[H.R. 2672] 
Federal 
Employees' 
Retirement 
System Act 
of 1986. 
New Jersey 
International 
and 
Bulk Mail 
Center. 
To amend title 5, United States Code, to establish a new retirement and disability 
plan for Federal employees, postal employees, and Members of Congress, and for 
other purposes. 
Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled, 
SECTION 1. REDESIGNATION OF BUILDING. 
(a) REDESIGN 
ATION.—The New York Bulk and Foreign Mail 
Center in Jersey City, New Jersey, shall hereafter be known and 
designated as the "New Jersey International and Bulk Mail 
Center". Any reference to such building in any law, map, regulation, 
document, record, or other paper of the United States shall be 
considered to be a reference to the New Jersey International and 
Bulk Mail Center. 
(b) EFFECTIVE DATE.—This section shall take effect 6 months after 
the date of the enactment of this Act. 
SEC. 2. DEDICATION OF MICHAEL McDERMOTT PLACE. 
(a) ERECTION OF SIGN.—The United States Postal Service shall 
erect a suitable sign bearing the inscription "Michael McDermott 
Place", anywhere on its property adjacent to the street and parking 
area located immediately to the east of the New York Bulk and 
Foreign Mail Center building in Jersey City, New Jersey, so as to 
dedicate such portion of such street in memory of former postal 
employee Michael McDermott. 
(b) EFFECTIVE DATE.—This section shall take effect on the date of 
the enactment of this Act. 
TITLE I~FEDERAL EMPLOYEES' 
RETIREMENT SYSTEM 
SEC. 100. SHORT TITLE; TABLE OF CONTENTS. 
5 use 8401 note. 
(a) SHORT TITLE.—This Act may be cited as the "Federal 
Employees' Retirement System Act of 1986". 
(b) TABLE OF CONTENTS.—The table of contents is as follows: 
TABLE OF CONTENTS 
TITLE I-FEDERAL EMPLOYEES' RETIREMENT SYSTEM 
Sec. 100. Short title; table of contents. 
Sec. lOOA. Purposes. 
Sec. 101. Establishment. 
TITLE II—OTHER AMENDMENTS TO TITLE 5 OF THE UNITED STATES CODE 
Sec. 201. Treatment under Civil Service Retirement System of certain individuals 
excluded from Federal Employees' Retirement System. 
Sec. 202. Non-applicability of Civil Service Retirement System to individuals under 
Federal Employees' Retirement System. 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 515 
Sec. 203. Pay for the Executive Director of the Federal Retirement Thrift Invest-
ment Board. 
Sec. 204. Alternative forms of annuities. 
Sec. 205. Retirement counseling. 
Sec. 206. Participation by certain employees and Members only in the Thrift 
Savings Plan. 
Sec. 207. Miscellaneous amendments. 
TITLE III—OTHER PROVISIONS RELATING TO THE FEDERAL EMPLOYEES' 
RETIREMENT SYSTEM AND THE CIVIL SERVICE RETIREMENT SYSTEM 
Sec. 301. Elections. 
Sec. 302. Effect of an election under section 301 to become subject to the Federal 
Employees' Retirement System. 
Sec. 303. Provisions relating to an election to become subject to chapter 83 subject 
to certain offsets relating to Social Security. 
Sec. 304. Amendments relating to Social Security. 
Sec. 305. Extension of Federal Employees' Retirement Contribution Temporary Ad-
justment Act of 1983; refund of excess contributions. 
Sec. 306. Applicability to the United States Postal Service. 
Sec. 307. Use of "normal-cost percentage". 
Sec. 308. Retirement study. 
Sec. 309. Repeal of automatic transfer provision. 
Sec. 310. Disclosure of return information. 
Sec. 311. Initial appointments to the Federal Retirement Thrift Investment Board. 
Sec. 312. Plan for delayed contributions to the Thrift Savings Fund. 
TITLE IV—FOREIGN SERVICE RETIREMENT 
Sec. 401. Short title; references to Foreign Service Act of 1980. 
Sec. 402. Redesignation of certain provisions of the Foreign Service Act of 1980. 
Sec. 403. Definition of court. 
Sec. 404. Creditable service for purposes of subchapters I and II. 
Sec. 405. Contributions to the Foreign Service Retirement and Disability System. 
Sec. 406. Offset of annuity by the amount of Social Security benefits. 
Sec. 407. 18-month period to elect survivor annuity. 
Sec. 408. Alternate forms of annuities. 
Sec. 409. Treatment of certain recall service. 
Sec. 410. Reemployment. 
Sec. 411. Comparability between the Federal Employees' Retirement System and 
the Foreign Service Pension System. 
Sec. 412. Moderation of remarriage penalty. 
Sec. 413. Lump-sum payments. 
Sec. 414. Exclusion of participants in Foreign Service Pension System from Foreign 
Service Retirement and Disability System. 
Sec. 415. Foreign Service Pension System. 
Sec. 416. Table of contents. 
Sec. 417. Effective date. 
TITLE V—CENTRAL INTELLIGENCE AGENCY RETIREMENT AND RELATED 
MATTERS 
Sec. 501. References. 
Sec. 502. Contributions to the Central Intelligence Agency Retirement and Disabil-
ity System. 
Sec. 503. Offset of annuity by the amount of Social Security benefits. 
Sec. 504. Thrift savings fund participation by participants in the Central Intelli-
gence Agency Retirement and Disability System. 
Sec. 505. Alternative forms of annuities. 
Sec. 506. Participation in the Federal Employees' Retirement System. 
Sec. 507. Special retirement accrual for other intelligence personnel. 
TITLE VI-MISCELLANEOUS PROVISIONS 
Sec. 601. Annuities for survivors of District of Columbia judges. 
TITLE VII—AUTHORIZATION OF APPROPRIATIONS; EFFECTIVE DATES 
Sec. 701. Authorization of appropriations for certain expenses of the Federal Retire-
ment Thrift Investment Management System. 
Sec. 702. Effective dates. 
100 STAT. 516 
PUBLIC LAW 99-335—JUNE 6, 1986 
5 u s e 8401 note. 
SEC. lOOA. PURPOSES. 
The purposes of this Act are— 
(1) to establish a Federal employees' retirement plan which is 
42 use 401. 
coordinated with title II of the Social Security Act; 
(2) to ensure a fully funded and financially sound retirement 
benefits plan for Federal employees; 
(3) to enhance portability of retirement assets earned as an 
employee of the Federal Government; 
(4) to provide options for Federal employees with respect to 
retirement planning; 
(5) to assist in building a quality career work force in the 
Federal Government; 
(6) to encourage Federal employees to increase personal sav-
ings for retirement; and 
(7) to extend financial protection from disability to additional 
Federal employees and to increase such protection for eligible 
Federal employees. 
SEC. 101. ESTABLISHMENT. 
(a) IN GENERAL.—Title 5, United States Code, is amended by 
inserting after chapter 83 the following new chapter: 
"eHAPTER 84—FEDERAL EMPLOYEES' RETIREMENT SYSTEM 
"SUBCHAPTER I—GENERAL PROVISIONS 
"Sec. 
"8401. Definitions. 
"8402. Federal Employees' Retirement System; exclusions. 
"8403. Relationship to the Social Security Act. 
"SUBCHAPTER II—BASIC ANNUITY 
"8410. Eligibility for annuity. 
"8411. Creditable service. 
"8412. Immediate retirement. 
"8413. Deferred retirement. 
"8414. Early retirement. 
"8415. Computation of basic annuity. 
"8416. Survivor reduction for a current spouse. 
"8417. Survivor reduction for a former spouse. 
"8418. Survivor elections; deposit; offsets. 
"8419. Survivor reductions; computation. 
"8420. Insurable interest reductions. 
"8420a. Alternative forms of annuities. 
"8421. Annuity supplement. 
"8421a. Reductions on account of earnings from work performed while entitled to an 
annuity supplement. 
"8422. Deductions from pay; contributions for military service. 
"8423. Government contributions. 
"8424. Lump-sum benefits; designation of beneficiary; order of precedence. 
"8425. Mandatory separation. 
"SUBCHAPTER III—THRIFT SAVINGS PLAN 
"8431. Definition. 
"8432. Contributions. 
"8433. Benefits and election of benefits. 
"8434. Annuities: methods of payment; election; purchase. 
"8435. Protections for spouses and former spouses. 
"8436. Administrative provisions. 
"8437. Thrift Savings Fund. 
"8438. Investment of Thrift Savings Fund. 
"8439. Accounting and information. 
"8440. Tax treatment of the Thrift Savings Fund. 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 517 
"SUBCHAPTER IV-SURVIVOR ANNUITIES 
'8441. Definitions. 
'8442. Rights of a widow or widower. 
'8443. Rights of a child. 
'8444. Rights of a named individual with an insurable interest. 
'8445. Rights of a former spouse. 
"SUBCHAPTER V—DISABILITY BENEFITS 
"8451. Disability retirement. 
'8452. Computation of disability annuity. 
'8453. Application. 
'8454. Medical examination. 
'8455. Recovery; restoration of earning capacity. 
'8456. Relationship to workers' compensation. 
'8457. Military reserve technicians. 
"SUBCHAPTER VI—GENERAL AND ADMINISTRATIVE PROVISIONS 
"8461. Authority of the Office of Personnel Management. 
"8462. Cost-of-living adjustments. 
"8463. Rate of benefits. 
"8464. Commencement and termination of annuities of employees and Members. 
"8465. Waiver, allotment, and assignment of benefits. 
"8466. Application for benefits. 
"8467. Court orders. 
"8468. Annuities and pay on reemployment. 
"8469. Withholding of State income taxes. 
"8470. Exemption from legal process; recovery of payments. 
"SUBCHAPTER VII—FEDERAL RETIREMENT THRIFT INVESTMENT 
MANAGEMENT SYSTEM 
"8471. Definitions. 
"8472. Federal Retirement Thrift Investment Board. 
"8473. Employee Thrift Advisory Council. 
"8474. Executive Director. 
"8475. Investment policies. 
"8476. Administrative provisions. 
"8477. Fiduciary responsibilities; liability and penalties. 
"8478. Bonding. 
"8479. Exculpatory provisions; insurance. 
"SUBCHAPTER I—GENERAL PROVISIONS 
"§ 8401. Definitions 
5 USC 8401. 
"For the purpose of this chapter— 
"(1) the term 'account means an account established and 
maintained under section 8439(a) of this title; 
"(2) the term 'annuitant' means a former employee or 
Member who, on the basis of that individual's service, meets all 
requirements for title to an annuity under subchapter II or V of 
this chapter and files claim therefor; 
"(3) the term 'average pay' means the largest annual rate 
resulting from averaging an employee's or Member's rates of 
basic pay in effect over any 3 consecutive years of service or, in 
the case of an annuity under this chapter based on service of 
less than 3 years, over the total service, with each rate weighted 
by the period it was in effect; 
"(4) except as provided in subchapter III of this chapter, the 
term 'basic pay' has the meaning given such term by section 
8331(3); 
"(5) the term 'Board' means the Federal Retirement Thrift 
Investment Board established by section 8472(a) of this title; 
100 STAT. 518 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(6) the term 'Civil Service Retirement and Disability Fund' 
or 'Fund' means the Civil Service Retirement and Disability 
Fund under section 8348; 
"(7) the term 'court' means any court of any State, the 
District of Columbia, the Commonwealth of Puerto Rico, Guam, 
the Northern Mariana Islands, or the Virgin Islands, and any 
Indian court; 
"(8) the term 'Director' means the Director of the Office of 
Personnel Management; 
"(9) the term 'dynamic assumptions' means economic assump-
tions that are used in determining actuarial costs and liabilities 
of a retirement system and in anticipating the effects of long-
term future— 
"(A) investment yields; 
"(B) increases in rates of basic pay; and 
"(C) rates of price inflation; 
"(10) the term 'earnings', when used with respect to the Thrift 
Savings Fund, means the amount of the gain realized or yield 
received from the investment of sums in such Fund; 
"(11) the term 'employee' means— 
"(A) an individual referred to in subparagraph (A), (E), 
(F), (H), (I), or (J) of section 8331(1) of this title; and 
"(B) a Congressional employee as defined in section 2107 
of this title, including a temporary Congressional employee 
and an employee of the Congressional Budget Office; 
any of whose civilian service after December 31, 1983, is employ-
42 use 401. 
ment for the purposes of title II of the Social Security Act and 
26 use 3101 et 
chapter 21 of the Internal Revenue Code of 1954, except that 
seq- 
such term does not include— 
"(i) any individual referred to in— 
"(I) clause (i), (v), (vi), or (ix) of paragraph (1) of 
section 8331; 
"(II) clause (ii) of such paragraph (other than an 
employee of the United States Park Police, or the 
United States Secret Service, any of whose civilian 
service after December 31, 1983, is such employment); 
or 
"(III) the undesignated material after the last clause 
of such paragraph; or 
"(ii) any individual excluded under section 8402(c) of this 
title; 
"(12) the term 'former spouse' means a former spouse of an 
individual— 
"(A) if such individual performed at least 18 months of 
civilian service creditable under section 8411 as an 
employee or Member; and 
"(B) if the former spouse was married to such individual 
for at least 9 months; 
"(13) the term 'Executive Director' means the Executive 
Director appointed under section 8474(a); 
"(14) the term 'firefighter' means— 
"(A) an employee, the duties of whose position— 
"(i) are primarily to perform work directly connected 
with the control and extinguishment of fires; and 
"(ii) are sufficiently 
rigorous that 
employment 
opportunities are required to be limited to young and 
physically vigorous individuals, as determined by the 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 519 
Director considering the recommendations of the 
employing agency; and 
"(B) an employee who is transferred directly to a super-
visory or administrative position after performing duties 
described in subparagraph (A) for at least 10 years; 
"(15) the term 'Government' means the Federal Government 
and Gallaudet College; 
"(16) the term 'Indian court' has the meaning given such term 
by section 8331(24); 
"(17) the term 'law enforcement officer' means— 
"(A) an employee, the duties of whose position— 
"(i) are primarily— 
"(I) the investigation, apprehension, or detention 
of individuals suspected or convicted of offenses 
against the criminal laws of the United States, or 
"(II) the protection of officials of the United 
States against threats to personal safety; and 
"(ii) are sufficiently 
rigorous that 
employment 
opportunities are required to be limited to young and 
physically vigorous individuals, as determined by the 
Director considering the recommendations of the 
employing agency; 
"(B) an employee who is transferred directly to a super-
visory or administrative position after performing duties 
described in subparagraph (A) for at least 10 years; and 
"(C) an employee— 
"(i) of the Bureau of Prisons or Federal Prison Indus-
tries, Incorporated; 
"(ii) of the Public Health Service assigned to the field 
service of the Bureau of Prisons or of the Federal 
Prison Industries, Incorporated; or 
"(iii) in the field service at Army or Navy discipli-
nary barracks or at any other confinement and re-
habilitation facility operated by any of the armed 
forces; 
whose duties in connection with individuals in detention 
suspected or convicted of offenses against the criminal laws 
of the United States or of the District of Columbia or 
offenses against the punitive articles of the Uniform Code 
of Military Justice (chapter 47 of title 10) require frequent 
10 USC 801 et 
direct contact with these individuals in their detention and seq. 
are sufficiently rigorous that employment opportunities are 
required to be limited to young and physically vigorous 
individuals, as determined by the head of the employing 
agency; 
"(18) the term 'loss', when used with respect to the Thrift 
Savings Fund, means the amount of the loss resulting from the 
investment of sums in such Fund; 
"(19) the term 'lump-sum credit' means the unrefunded 
amount consisting o
f
— 
"(A) retirement deductions made from the basic pay of an 
employee or Member under section 8422(a) of this title (or 
under section 204 of the Federal Employees' Retirement 
Contribution Temporary Adjustment Act of 1983); 
5 use 8331 note. 
"(B) amounts deposited by an employee or Member under 
section 8422(e); and 
100 STAT. 520 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(C) interest on the deductions and deposits which, for 
any calendar year, shall be equal to the overall average 
yield to the Fund during the preceding fiscal year from all 
obligations purchased by the Secretary of the Treasury 
during such fiscal year under section 8348 (c), (d), and (e), as 
determined by the Secretary (compounded annually); 
but does not include interest— 
"(i) if the service covered thereby aggregates 1 year or 
less; or 
"(ii) for a fractional part of a month in the total service; 
"(20) the term 'Member' has the same meaning as provided in 
section 2106, except that such term does not include an individ-
ual who irrevocably elects, by written notice to the official by 
whom such individual is paid, not to participate in the Federal 
Employees' Retirement System; 
"(21) the term 'net earnings' means the excess of earnings 
over losses; 
"(22) the term 'net losses' means the excess of losses over 
earnings; 
"(23) the term 'normal-cost percentage' means the entry-age 
normal cost of the provisions of the System which relate to the 
Fund, computed by the Office in accordance with generally 
accepted actuarial practice and standards (using dynamic 
assumptions) and expressed as a level percentage of aggregate 
basic pay; 
"(24) the term 'Office' means the Office of Personnel 
Management; 
"(25) the term 'price index' has the same meaning as provided 
in section 8331(15); 
"(26) the term 'service' means service which is creditable 
under section 8411; 
"(27) the term 'supplemental liability' means the estimated 
excess o
f
— 
"(A) the actuarial present value of all future benefits 
payable from the Fund under this chapter based on the 
service of current or former employees or Members, over 
"(B) the sum of— 
"(i) the actuarial present value of deductions to be 
withheld from the future bcisic pay of employees and 
Members currently subject to this chapter pursuant to 
section 8422; 
"(ii) the actuarial present value of the future con-
tributions to be made pursuant to section 8423(a) with 
respect to employees and Members currently subject to 
this chapter; 
"(iii) the Fund balance as of the date the supple-
mental liability is determined, to the extent that such 
balance is attributable— 
"(I) to the System, or 
"(II) to contributions made under the Federal 
Employees' Retirement Contribution Temporary 
5 use 8331 note. 
Adjustment Act of 1983 by or on behalf of an 
individual who became subject to the System; and 
"(iv) any other appropriate amount, as determined by 
the Office in accordance with generally accepted 
actuarial practices and principles; 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 521 
"(28) the term 'survivor' means an individual entitled to an 
annuity under subchapter IV of this chapter; 
"(29) the term 'System' means the Federal Employees' Retire-
ment System described in section 8402(a); 
"(30) the term 'military reserve technician' means a member 
of one of the reserve components of the armed forces specified in 
section 261(a) of title 10 who— 
"(A) is assigned to a civilian position as a technician in 
the administration and training of such reserve components 
or in the maintenance and repair of supplies issued to such 
reserve components; and 
"(B) as a condition of employment in such position, is 
required to be a member of one of such reserve components 
serving in a specified military grade; and 
"(31) the term 'military service' means honorable active 
service— 
"(A) in the armed forces; 
"(B) in the commissioned corps of the Public Health 
Service after June 30,1960; or 
"(C) in the commissioned corps of the National Oceanic 
and Atmospheric Administration, or a predecessor entity in 
function, after June 30,1961; 
but does not include service in the National Guard except when 
ordered to active duty in the service of the United States. 
"§ 8402. Federal Employees' Retirement System; exclusions 
5 use 8402. 
"(a) The provisions of this chapter comprise the Federal Em-
ployees' Retirement System. 
"(b) The provisions of this chapter shall not apply with respect 
to— 
"(1) any individual who has performed service of a type 
described in subparagraph (C), (D), (E), or (F) of section 210(a)(5) 
of the Social Security Act continuously since December 31,1983 42 use 4io. 
(determined in accordance with the provisions of section 
210(a)(5)(B) of the Social Security Act, relating to continuity of 
employment); or 
"(2)(A) any employee or Member who hgis separated from the 
service after— 
"(i) having been subject to subchapter III of chapter 83 of 
this title, or subchapter I of chapter 8 of the Foreign Service Post, pp. 589, 
Act of 1980; and 
^^\-f^^-
"(ii) having completed at least 5 years of civilian service 
creditable under subchapter III of chapter 83 of this title, or 
at least 5 years of civilian service creditable under sub-
chapter I of the Foreign Service Act of 1980 (determined 
without regard to any deposit or redeposit requirement 
under either such subchapter, or any requirement that the 
individual become subject to either such subchapter after 
performing the service involved); or 
"(B) any employee having at least 5 years of civilian service 
performed before January 1, 1987, creditable under subchapter 
III of chapter 83 of this title (determined without regard to any 
deposit or redeposit requirement under such subchapter, any 
requirement that the individual become subject to such sub-
chapter after performing the service involved, or any require-
ment that the individual give notice in writing to the official by 
22 use 4041. 
100 STAT. 522 
PUBLIC LAW 99-335—JUNE 6, 1986 
whom such individual is paid of such individual's desire to 
become subject to such subchapter); 
except to the extent provided for under title III of the Federal 
Employees' Retirement System Act of 1986 pursuant to an election 
under such title to become subject to this chapter. 
"(c)(1) The Office may exclude from the operation of this chapter 
an employee or group of employees in or under an Executive agency, 
the United States Postal Service, or the Postal Rate Commission, 
whose employment is temporary or intermittent, except an em-
ployee whose employment is part-time career employment (as 
defined in section 3401(2)). 
"(2) The Architect of the Capitol may exclude from the operation 
of this chapter an employee under the Office of the Architect of the 
Capitol whose employment is temporary or of uncertain duration. 
"(3) The Librarian of Congress may exclude from the operation of 
this chapter an employee under the Library of Congress whose 
employment is temporary or of uncertain duration. 
"(4) The Director or Acting Director of the Botanic Garden may 
exclude from the operation of this chapter an employee under the 
Botanic Garden whose employment is temporary or of uncertain 
duration. 
5 use 8403 
"§ 8403. Relationship to the Social Security Act 
"Except as otherwise provided in this chapter, the benefits pay-
able under the System are in addition to the benefits payable under 
42 use 1305. 
the Social Security Act. 
"SUBCHAPTER II—BASIC ANNUITY 
5 use 8410. 
"§ 8410. Eligibility for annuity 
"Notwithstanding any other provision of this chapter, an 
employee or Member must complete at least 5 years of civilian 
service creditable under section 8411 in order to be eligible for an 
annuity under this subchapter. 
5 use 8411. 
"§ 8411. Creditable service 
"(a)(1) The total service of an employee or Member is the full 
years and twelfth parts thereof, excluding from the aggregate the 
fractional part of a month, if any. 
"(2) Credit may not be allowed for a period of separation from the 
service in excess of 3 calendar days. 
"(b) For the purpose of this chapter, creditable service of an 
employee or Member includes— 
"(1) employment as an employee, and any service as a 
Member (including the period from the date of the beginning of 
the term for which elected or appointed to the date of taking 
office as a Member), after December 31,1986; 
"(2) 
service 
with 
respect 
to 
which 
deductions 
and 
withholdings under section 204(aXl) of the Federal Employees' 
5 use 8331 note. 
Retirement Contribution Temporary Adjustment Act of 1983 
have been made; 
"(3) except as provided in subsection (f), any civilian service 
(performed before January 1,1989, other than any service under 
paragraph (1) or (2)) which, but for the amendments made by 
subsections (a)(4) and (b) of section 202 of the Federal Em-
ployees' Retirement System Act of 1986, would be creditable 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 523 
under subchapter III of chapter 83 of this title (determined 
Post, pp. 589, 
without regard to any deposit or redeposit requirement under 
591-593. 
such subchapter, any requirement that the individual become 
subject to such subchapter after performing the service involved, 
or any requirement that the individual give notice in writing to 
the official by whom such individual is paid of such individual's 
desire to become subject to such subchapter); and 
"(4) a period of service (other than any service under any of 
the preceding provisions of this subsection and other than any 
military service) that was creditable under the Foreign Service 
Pension System described in subchapter II of chapter 8 of the 
Foreign Service Act of 1980, if the employee or Member waives 
22 use 3901. 
credit for such service under the Foreign Service Pension 
System and makes a payment to the Fund equal to the amount 
that would hdve been deducted from pay under section 8422(a) 
had the employee been subject to tnis chapter during such 
period of service (together with interest on such amount com-
puted under paragraphs (2) and (3) of section 8334(e)). 
"(cXD Except as provided in paragraph (2) or (3), an employee or 
Member shall be allowed credit for— 
"(A) each period of military service performed before Janu-
ary 1,1957; and 
"(B) each period of military service performed after Decem-
ber 31,1956, and before the separation on which title to annuity 
is based, if a deposit (including interest, if any) is made with 
respect to such period in accordance with section 8422(e). 
"(2) If an employee or Member is awarded retired pay based on 
any period of military service, the service of the employee or 
Member may not include credit for such period of military service 
unless the retired pay is awarded— 
"(A) based on a service-connected disability— 
"(i) incurred in combat with an enemy of the United 
States; or 
"(ii) caused by an instrumentality of war and incurred in 
line of duty during a period of war as defined by section 301 
of title 38; or 
"(B) under chapter 67 of title 10. 
lo use I33i 
"(3) An employee or Member who has made a deposit under etseq. 
section 8334(j) (or a similar prior provision of law) with respect to a 
period of military service, and who has not taken a refund of such 
deposit— 
"(A) shall be allowed credit for such service without regard to 
the deposit requirement under paragraph (1)(B); and 
"(B) shall be entitled, upon filing appropriate application 
therefor with the Office, to a refund equal to the difference 
between— 
"(i) the amount deposited with respect to such period 
under such section 8334(j) (or prior provision), excluding 
interest; and 
"(ii) the amount which would otherwise have been 
required with respect to such period under paragraph (IXB). 
"(d) Credit under this chapter shall be allowed for leaves of 
absence without pay granted an employee while performing mili-
tary service, or while receiving benefits under subchapter I of 
chapter 81. An employee or former employee who returns to duty 
5 use 8101. 
after a period of separation is deemed, for the purpose of this 
subsection, to have been on leave of absence without pay for that 
100 STAT. 524 
PUBLIC LAW 99-335—JUNE 6, 1986 
part of the period in which that individual was receiving benefits 
5 use 8101. 
under subchapter I of chapter 81. Credit may not be allowed for so 
much of other leaves of absence without pay as exceeds 6 months in 
the aggregate in a calendar year. 
"(e) Credit shall be allowed for periods of approved leave without 
pay granted an employee to serve as a full-time officer or employee 
of an organization composed primarily of employees (as defined by 
section 8331(1) or 8401(11)), subject to the employee arranging to 
pay, through the employee's employing agency, within 60 days after 
commencement of such leave without pay, amounts equal to the 
retirement deductions and agency contributions which would be 
applicable under sections 8422(a) and 8423(a), respectively, if the 
employee were in pay status. If the election and all payments 
provided by this subsection are not made, the employee may not 
receive credit for the periods of leave without pay, notwithstanding 
the third sentence of subsection (d). 
"(f)(1) An employee or Member who has received a refund of 
retirement deductions under subchapter III of chapter 83 with 
respect to any service described in subsection (b)(3) may not be 
allowed credit for such service under this chapter unless such 
employee or Member deposits an amount equal to 1.3 percent of 
basic pay for such service, with interest. 
"(2) An employee or Member may not be allowed credit under this 
chapter for any service described in subsection (b)(3) for which 
Post, pp. 589, 
retirement deductions under subchapter III of chapter 83 have not 
591-593. 
been made, unless such employee or Member deposits an amount 
equal to 1.3 percent of basic pay for such service, with interest. 
"(3) Interest under paragraph (1) or (2) shall be computed in 
accordance with paragraphs (2) and (3) of section 8334(e) and regula-
tions prescribed by the Office. 
"(4) For the purpose of survivor annuities, deposits authorized by 
the preceding provisions of this subsection may also be made by a 
survivor of an employee or Member. 
5 use 8412. 
"§ 8412. Immediate retirement 
"(a) An employee or Member who is separated from the service 
after attaining the applicable minimum retirement age under 
subsection (h) and completing 30 years of service is entitled to an 
annuity. 
"(b) An employee or Member who is separated from the service 
after becoming 60 years of age and completing 20 years of service is 
entitled to an annuity. 
"(c) An employee or Member who is separated from the service 
after becoming 62 years of age and completing 5 years of service is 
entitled to an annuity. 
"(d) An employee who is separated from the service, except by 
removal for cause on charges of misconduct or delinquency— 
"(1) after completing 25 years of service as a law enforcement 
officer or firefighter, or any combination of such service totaling 
at least 25 years, or 
"(2) after becoming 50 years of age and completing 20 years of 
service as a law enforcement officer or firefighter, or any 
combination of such service totaling at least 20 years, 
is entitled to an annuity. 
"(e) An employee who is separated from the service, except by 
removal for cause on charges of misconduct or delinquency— 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 525 
"(1) after completing 25 years of service as an air traffic 
controller, or 
"(2) after becoming 50 years of age and completing 20 years of 
service as an air traffic controller, 
is entitled to an annuity. 
"(f) A Member who is separated from the service, except by 
resignation or expulsion— 
"(1) after completing 25 years of service, or 
"(2) after becoming 50 years of age and completing 20 years of 
service, 
is entitled to an annuity. 
"(g) An employee or Member who is separated from the service 
after attaining the applicable minimum retirement age under 
subsection (h) and completing 10 years of service is entitled to an 
annuity. This subsection shall not apply to an employee or Member 
who is entitled to an annuity under any other provision of this 
section. 
"(h)(1) The applicable minimum retirement age under this subsec-
tion is— 
"(A) for an individual whose date of birth is before January 1, 
1948, 55 years of age; 
"(B) for an individual whose date of birth is after Decem-
ber 31, 1947, and before January 1,1953, 55 years of age plus the 
number of months in the age increase factor determined under 
paragraph (2)(A); 
"(C) for an individual whose date of birth is after Decem-
ber 31, 1952, and before January 1, 1965, 56 years of age; 
"(D) for an individual whose date of birth is after Decem-
ber 31,1964, and before January 1,1970, 56 years of age plus the 
number of months in the age increase factor determined under 
paragraph (2)(B); and 
"(E) for an individual whose date of birth is after Decem-
ber 31,1969, 57 years of age. 
"(2)(A) For an individual whose date of birth occurs during the 5-
year period consisting of calendar years 1948 through 1952, the age 
increase factor shall be equal to two-twelfths times the number of 
months in the period beginning with January 1948 and ending with 
December of the year in which the date of birth occurs. 
"(B) For an individual whose date of birth occurs during the 5-year 
period consisting of calendar years 1965 through 1969, the age 
increase factor shall be equal to two-twelfths times the number of 
months in the period beginning with January 1965 and ending with 
December of the year in which the date of birth occurs. 
"§ 8413. Deferred retirement 
5 use 8413. 
"(a) An employee or Member who is separated from the service, or 
transferred to a position in which the employee or Member does not 
continue subject to this chapter, after completing 5 years of service 
is entitled to an annuity beginning at the age of 62 years. 
"(b)(1) An employee or Member who is separated from the service, 
or transferred to a position in which the employee or Member does 
not continue subject to this chapter, after completing 10 years of 
service is entitled to an annuity beginning on the date designated by 
the employee or Member in a written election under this subsection. 
The date designated under this subsection may not precede the date 
on which the employee or Member attains the applicable minimum 
100 STAT. 526 
PUBLIC LAW 99-335—JUNE 6, 1986 
retirement age under section 8412(h) and must precede the date on 
which the employee or Member becomes 62 years of age. 
"(2) The election of an annuity under this subsection shall not be 
effective unless— 
"(A) it is made at such time and in such manner as the Office 
shall by regulation prescribe; and 
"(B) the employee or Member will not otherwise be eligible to 
receive an annuity within 31 days after filing the election. 
"(3) The election of an annuity under this subsection extinguishes 
the right of the employee or Member to receive any other annuity 
based on the service on which the annuity under this subsection is 
based. 
5 use 8414. 
"§ 8414. Early retirement 
"(a)(1) A member of the Senior Executive Service who is removed 
from the Senior Executive Service for less than fully successful 
executive performance (as determined under subchapter II of chap-
5 use 4311. 
ter 43 of this title) after completing 25 years of service, or after 
becoming 50 years of age and completing 20 years of service, is 
entitled to an annuity. 
"(2) A member of the Defense Intelligence Senior Executive Serv-
ice or the Senior Cryptologic Executive Service who is removed from 
such service for less than fully successful executive performance 
after completing 25 years of service, or after becoming 50 years of 
age and completing 20 years of service, is entitled to an annuity. 
"Ot))(l) Except as provided in paragraphs (2) and (3), an employee 
who— 
"(A) is separated from the service involuntarily, except by 
removal for cause on charges of misconduct or delinquency; or 
"(B) while serving in a geographic area designated by the 
Director, is separated from the service voluntarily during a 
period in which (as determined by the Director)— 
"(i) the agency in which the employee is serving is under-
going a major reorganization, a major reduction in force, or 
a major transfer of function; and 
"(ii) a significant percentage of the total number of 
employees serving in such agency will be separated or 
subject to an immediate reduction in the rate of basic pay 
5 use 5361. 
(without regard to subchapter VI of chapter 53 of this title 
or comparable provisions); 
after completing 25 years of service, or after becoming 50 years of 
age and completing 20 years of service, is entitled to an annuity. 
"(2) An employee under paragraph (1) who is separated as de-
scribed in subparagraph (A) of such paragraph is not entitled to an 
annuity under this subsection if the employee has declined a reason-
able offer of another position in the employee's agency for which the 
employee is qualified, and the offered position is not lower than 2 
grades (or pay levels) below the employee's grade (or pay level) and 
is within the employee's commuting area. 
"(3) Paragraph (1) shall not apply to an employee entitled to an 
annuity under subsection (d) or (e) of section 8412. 
"(c) A military reserve technician who is separated from techni-
cian service, after becoming 50 years of age and completing 25 years 
of service, by reason of ceasing to satisfy the condition described in 
section 8401(30)(B) is entitled to an annuity. 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 527 
"§ 8415. Computation of basic annuity 
5 use 8415. 
"(a) Except as otherwise provided in this section, the annuity of an 
employee retiring under this subchapter is 1 percent of that individ-
ual's average pay multiplied by such individual's total service. 
"(b) The annuity of a Member, or former Member with title to a 
Member annuity, retiring under this subchapter is computed under 
subsection (a), except that if the individual has had at least 5 years 
of service as a Member or Congressional employee, or any combina-
tion thereof, so much of the annuity as is computed with respect to 
either such type of service (or a combination thereof), not exceeding 
a total of 20 years, shall be computed by multiplying IVio percent of 
the individual's average pay by the years of such service. 
"(c) The annuity of a Congressional employee, or former Congres-
sional employee, retiring under this subchapter is computed under 
subsection (a), except that if the individual has had at least 5 years 
of service as a Congressional employee or Member, or any combina-
tion thereof, so much of the annuity as is computed with respect to 
either such type of service (or a combination thereof), not exceeding 
a total of 20 years, shall be computed by multiplying IVio percent of 
the individual's average pay by the years of such service. 
"(d) The annuity of an employee retiring under subsection (d) or 
(e) of section 8412 or under subsection (a) or (b) of section 8425 is— 
"(1) IVio percent of that individual's average pay multiplied 
by so much of such individual's total service as does not exceed 
20 years; plus 
"(2) 1 percent of that individual's average pay multiplied by 
so much of such individual's total service as exceeds 20 years. 
"(e)(1) In computing an annuity under this subchapter for an 
employee whose service includes service performed on a part-time 
basis— 
"(A) the average pay of the employee, to the extent that it 
includes pay for service performed in any position on a part-
time basis, shall be determined by using the annual rate of basic 
pay that would be payable for full-time service in the position; 
and 
"(B) the benefit so computed shall then be multiplied by a 
fraction equal to the ratio which the employee's actual service, 
as determined by prorating the employee's total service to 
reflect the service that was performed on a part-time basis, 
bears to the total service that would be creditable for the 
employee if all of the service had been performed on a full-time 
basis. 
"(2) For the purpose of this subsection, employment on a part-time 
basis shall not be considered to include employment on a temporary 
or intermittent basis. 
"(f)(1) The annuity of an employee or Member retiring under 
section 8412(g) or 8418(b) is computed in accordance with applicable 
provisions of this section, except that the annuity shall be reduced 
by five-twelfths of 1 percent for each full month by which the 
commencement date of the annuity precedes the sixty-second 
anniversary of the birth of the employee or Member. 
"(2)(A) Paragraph (1) does not apply in the case of an employee or 
Member retiring under section 8413(b) if the employee or Member 
would satisfy the age and service requirements for title to an 
annuity under section 8412 (a), (b), (d)(2), (e)(2), or (f)(2), determined 
100 STAT. 528 
PUBLIC LAW 99-335—JUNE 6, 1986 
as if the employee or Member had, as of the date of separation, 
attained the age specified in subparagraph (B). 
"(B) A determination under subparagraph (A) shall be based on 
how old the employee or Member will be as of the date on which the 
annuity under section 8413(b) is to commence. 
"(g)(1) In applying subsection (a) with respect to an employee 
under paragraph (2), the percentage applied under such subsection 
shall be 1.1 percent, rather than 1 percent. 
"(2) This subsection applies in the case of an employee who— 
"(A) retires entitled to an annuity under section 8412; and 
"(B) at the time of the separation on which entitlement to the 
annuity is based, is at least 62 years of age and has completed at 
least 20 years of service; 
but does not apply in the case of a Congressional employee, military 
reserve technician, law enforcement officer, firefighter, or air traffic 
controller. 
5 use 8416. 
"§ 8416. Survivor reduction for a current spouse 
"(a)(1) If an employee or Member is married at the time of retiring 
under this chapter, the reduction described in section 8419(a) shall 
be made unless the employee or Member and the spouse jointly 
waive, by written election, any right which the spouse may have to a 
survivor annuity under section 8442 based on the service of such 
employee or Member. A waiver under this paragraph shall be filed 
with the Office under procedures prescribed by the Office. 
"(2) Notwithstanding paragraph (1), an employee or Member who 
is married at the time of retiring under this chapter may waive the 
annuity for a surviving spouse without the spouse's consent if the 
employee or Member establishes to the satisfaction of the Office (in 
accordance with regulations prescribed by the Office)— 
"(A) that the spouse's whereabouts cannot be determined; or 
"(B) that, due to exceptional circumstances, requiring the 
employee or Member to seek the spouse's consent would other-
wise be inappropriate. 
"(3) Except as provided in subsection (d), a waiver made under this 
subsection shall be irrevocable. 
"(b)(1) Upon remarriage, a retired employee or Member who was 
married at the time of retirement (including an employee or 
Member whose annuity was not reduced to provide a survivor 
annuity for the employee's or Member's spouse or former spouse as 
of the time of retirement) may irrevocably elect during such mar-
riage, in a signed writing received by the Office within 2 years after 
such remarriage or, if later, within 2 years after the death or 
remarriage of any former spouse of such employee or Member who 
was entitled to a survivor annuity under section 8445 (or of the last 
such surviving former spouse, if there was more than one), a reduc-
tion in the employee's or Member's annuity under section 8419(a) for 
the purpose of providing an annuity for such employee's or Mem-
ber's spouse in the event such spouse survives the employee or 
Member. 
"(2) The election and reduction shall be effective the first day of 
the second month after the election is received by the Office, but not 
less than 9 months after the date of the remarriage. 
"(3) An election to provide a survivor annuity to an individual 
under this subsection— 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 529 
"(A) shall prospectively void any election made by the em-
ployee or Member under section 8420 with respect to such 
individual; or 
"(B) shall, if an election was made by the employee or 
Member under section 8420 with respect to a different individ-
ual, prospectively void such election if appropriate written ap-
plication is made by such employee or Member at the time of 
making the election under this subsection. 
"(4) Any election under this subsection made by an employee or 
Member on behalf of an individual after the retirement of such 
employee or Member shall not be effective if— 
"(A) the employee or Member was married to such individual 
at the time of retirement; and 
"(B) the annuity rights of such individual based on the service 
of such employee or Member were then waived under subsec-
tion (a). 
"(cXD An employee or Member who is unmarried at the time of 
retiring under this chapter and who later marries may irrevocably 
elect, in a signed writing received by the Office within 2 years after 
such employee or Member marries or, if later, within 2 years after 
the death or remarriage of any former spouse of such employee or 
Member who was entitled to a survivor annuity under section 8445 
(or of the last such surviving former spouse, if there was more than 
one), a reduction in the current annuity of the retired employee or 
Member, in accordance with section 8419(a). 
"(2) The election and reduction shall take effect the first day of 
the first month beginning 9 months after the date of marriage. Any 
such election to provide a survivor annuity for an individual— 
"(A) shall prospectively void any election made by the em-
ployee or Member under section 8420 with respect to such 
individual; or 
"(B) shall, if an election was made by the employee or 
Member under section 8420 with respect to a different individ-
ual, prospectively void such election if appropriate written ap-
plication is made by such employee or Member at the time of 
making the election under this subsection. 
"(d)(1) An employee or Member— 
"(A) who is married on the date of retiring under this chapter, 
and 
"(B) with respect to whose spouse a waiver under subsection 
(a) has been made, 
may, during the 18-month period beginning on such date, elect to 
have a reduction made under section 8419 in order to provide a 
survivor annuity under section 8442 for such spouse. 
"(2XA) An election under this subsection shall not be effective 
unless the amount described in subparagraph (B) is deposited into 
the Fund before the expiration of the 18-month period referred to in 
paragraph (1). 
"(B) The amount to be deposited under this subparagraph is equal 
to the sum of— 
"(i) the difference (for the period between the date on which 
the annuity of the former employee or Member commences and 
the date on which reductions pursuant to the election under 
this subsection commence) between the amount paid to the 
former employee or Member from the Fund under this chapter 
and the amount which would have been paid if such election 
had been made at the time of retirement; and 
100 STAT. 530 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(ii) the costs associated with providing for the election under 
this subsection. 
The amount to be deposited under clause (i) shall include interest, 
computed at the rate of 6 percent a year. 
"(3) An annuity which is reduced pursuant to an election by a 
former employee or Member under this subsection shall be reduced 
by the same percentage as was in effect under section 8419 as of the 
date of the employee's or Member's retirement. 
"(4) Rights and obligations under this chapter resulting from an 
election under this subsection shall be the same as the rights and 
obligations which would have resulted had the election been made 
at the time of retirement. 
"(5) The Office shall inform each employee and Member who is 
eligible to make an election under this subsection of the right to 
make such election and the procedures and deadlines applicable in 
making any such election. 
5 use 8417. 
"§ 8417. Survivor reduction for a former spouse 
"(a) If an employee or Member has a former spouse who is entitled 
to a survivor annuity as provided in section 8445, the reduction 
described in section 8419(a) shall be made. 
"(b)(1) An employee or Member who has a former spouse may 
elect, under procedures prescribed by the Office, a reduction in the 
annuity of the employee or Member under section 8419(a) in order to 
provide a survivor annuity for such former spouse under section 
8445. 
"(2) An election under this subsection shall be made at the time of 
retirement or, if the marriage is dissolved after the date of retire-
ment, within 2 years after the date on which the marriage of the 
former spouse to the employee or Member is so dissolved. 
"(3) An election under this subsection— 
"(A) shall not be effective to the extent that it— 
"(i) conflicts with— 
"(I) any court order or decree referred to in section 
8445(a) which was issued before the date of such elec-
tion; or 
"(II) any agreement referred to in such section 
8445(a) which was entered into before such date; or 
"(ii) would cause the total of survivor annuities payable 
under sections 8442 and 8445, respectively, based on the 
service of the employee or Member to exceed the amount 
which would be payable to a widow or widower of such 
employee or Member under such section 8442 (determined 
without regard to any reduction to provide for an annuity 
under such section 8445); and 
"(B) shall not be effective, in the case of an employee or 
Member who is then married, unless it is made with the 
spouse's written consent. 
Regulations. 
The Office shall by regulation provide that subparagraph (B) may be 
waived for either of the reasons set forth in section 8416(a)(2). 
5 use 8418. 
"§ 8418. Survivor elections; deposit; offsets 
"(a)(1) An individual who makes an election under subsection (b) 
or (c) of section 8416 or section 8417(b) which is required to be made 
within 2 years after the date of a prescribed event shall deposit into 
the Fund, before the expiration of the 2-year period involved, an 
amount determined by the Office (as nearly as may be administra-
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 531 
lively feasible) to reflect the amount by which the annuity of such 
individual would have been reduced if the election had been in effect 
since the date of retirement (or, if later, and in the case of an 
election under such section 8416(b), since the date the previous 
reduction in the annuity of such individual was terminated under 
paragraph (1) or (2) of section 8419(b)), plus interest. 
"(2) Interest under paragraph (1) shall be computed at the rate of 
6 percent a year. 
"(b) If the electing individual does not make the deposit required 
under subsection (a), the Office shall collect such amount by offset 
against such individual's annuity, up to a maximum of 25 percent of 
the net annuity otherwise payable, and the individual is deemed to 
consent to such offset. 
"(c) Subsections (a) and (b) shall not apply if^ 
"(1) the employee or Member makes an election under section 
8416 (b) or (c) after having made an election under section 8420; 
and 
"(2) the election under such section 8420 becomes void under 
subsection Ot))(3) or (c)(2) of such section 8416. 
"(d) The Office shall prescribe regulations under which the survi-
vor of an employee or Member may make a deposit under this 
section. 
"§ 8419. Survivor reductions; computation 
"(a)(1) Except as provided in paragraph (2), the annuity of an 
annuitant computed under section 8415, or under section 8452 
(including subsection (a)(2) of such section, if applicable), shall be 
reduced by 10 percent if a survivor annuity, or a combination of 
survivor annuities, under section 8442 or 8445 (or both) are to be 
provided for. 
"(2)(A) If no survivor annuity under section 8442 is to be provided 
for, but one or more survivor annuities under section 8445 involving 
a total of less than the entirety of the amount referred to in 
subsection (b)(2) of such section are to be provided for, the annuity of 
the annuitant involved (as computed under section 8415, or under 
section 8452 (including subsection (a)(2) of such section, if ap-
plicable)), shall be reduced by an appropriate percentage determined 
under subparagraph (B). 
"(B) The Office shall prescribe regulations under which an appro-
priate reduction under this paragraph, not to exceed a total of 10 
percent, shall be made. 
"(b)(1) Any reduction in an annuity for the purpose of providing a 
survivor annuity for the current spouse of a retired employee or 
Member shall be terminated for each full month— 
"(A) after the death of the spouse; or 
"(B) after the dissolution of the spouse's marriage to the 
employee or Member, except that an appropriate reduction 
shall be made thereafter if the spouse is entitled, as a former 
spouse, to a survivor annuity under section 8445. 
"(2) Any reduction in an annuity for the purpose of providing a 
survivor annuity for a former spouse of a retired employee or 
Member shall be terminated for each full month after the former 
spouse remarries before reaching age 55 or dies. This reduction shall 
be replaced by appropriate reductions under subsection (a) if the 
retired employee or Member has one or more of the following: 
"(A) another former spouse who is entitled to a survivor 
annuity under section 8445; 
Regulations. 
5 use 8419. 
Regulations. 
100 STAT. 532 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(B) a current spouse to whom the employee or Member was 
married at the time of retirement and with respect to whom a 
survivor annuity was not waived under section 8416(a) (or, if 
waived, with respect to whom an election under section 8416(d) 
has been made); or 
"(C) a current spouse whom the employee or Member married 
after retirement and with respect to whom an election has been 
made under subsection (b) or (c) of section 8416. 
5 use 8420. 
"§ 8420. Insurable interest reductions 
"(a)(1) At the time of retiring under section 8412, 8413, or 8414, an 
employee or Member who is found to be in good health by the Office 
may elect to have such employee's or Member's annuity (as com-
puted under section 8415) reduced under paragraph (2) in order to 
provide an annuity under section 8444 for an individual having an 
insurable interest in the employee or Member. Such individual shall 
be designated by the employee or Member in writing. 
"(2) 'The annuity of the employee or Member making the election 
is reduced by 10 percent, and by 5 percent for each full 5 years the 
individual named is younger than the retiring employee or Member, 
except that the total reduction may not exceed 40 percent. 
"(3) An annuity which is reduced under this subsection shall, 
effective the first day of the month following the death of the 
individual named under this subsection, be recomputed and paid as 
if the annuity had not been so reduced. 
"(b)(1) In the case of a married employee or Member, an election 
under this section on behalf of the spouse may be made only if any 
right of such spouse to a survivor annuity based on the service of 
such employee or Member is waived in accordance with section 
8416(a). 
"(2) Paragraph (1) does not apply in the case of an employee or 
Member if such employee or Member has a former spouse who 
would become entitled to an annuity under section 8445 as a survi-
vor of such employee or Member. 
5 use 8420a. 
"§ 8420a. Alternative forms of annuities 
Regulations. 
"(a) The Office shall prescribe regulations under which an em-
ployee or Member may, at the time of retiring under this sub-
chapter, elect annuity benefits under this section instead of any 
other benefits under this subchapter, and any benefits under sub-
chapter IV of this chapter, based on the service of the employee or 
Member. 
"(b) Subject to subsection (c), the Office shall by regulation provide 
for such alternative forms of annuities as the Office considers 
appropriate, except that among the alternatives offered shall be— 
"(1) an alternative which provides for— 
"(A) payment of the lump-sum credit (excluding interest) 
to the employee or Member; and 
"(B) payment of an annuity to the employee or Member 
for life; and 
"(2) in the case of an employee or Member who is married at 
the time of retirement, an alternative which provides for— 
"(A) payment of the lump-sum credit (excluding interest) 
to the employee or Member; and 
"(B) payment of an annuity to the employee or Member 
for life, with a survivor annuity payable for the life of a 
surviving spouse. 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 533 
"(c) Each alternative provided for under subsection (b) shall, to the 
extent practicable, be designed such that the present value of the 
benefits provided under such alternative (including any lump-sum 
credit) is actuarially equivalent to the sum of— 
"(1) the present value of the annuity which would otherwise 
be provided under this subchapter, as computed under section 
8415; and 
"(2) the present value of the annuity supplement which would 
otherwise be provided (if any) under section 8421. 
"(d) An employee or Member who, at the time of retiring under 
this subchapter— 
"(1) is married, shall be ineligible to make an election under 
this section unless a waiver is made under section 8416(a); or 
"(2) has a former spouse, shall be ineligible to make an 
election under this section if the former spouse is entitled to 
benefits under section 8445 or 8467 (based on the service of the 
employee or Member) under the terms of a decree of divorce or 
annulment, or a court order or court-approved property settle-
ment incident to any such decree, with respect to which the 
Office has been duly notified. 
"(e) An employee or Member who is married at the time of 
retiring under this subchapter and who makes an election under 
this section may, during the 18-month period beginning on the date 
of retirement, make the election provided for under section 8416(d), 
subject to the deposit requirement thereunder. 
"§ 8421. Annuity supplement 
5 USC 8421. 
"(a)(1) Subject to paragraph (3), an individual shall, if and while 
entitled to an annuity under subsection (a), (b), (d), or (e) of section 
8412, or under section 8414(c), also be entitled to an annuity supple-
ment under this section. 
"(2) Subject to paragraph (3), dn individual shall, if and while 
entitled to an annuity under section 8412(f), or under subsection (a) 
or (b) of section 8414, also be entitled to an annuity supplement 
under this section if such individual is at least the applicable 
minimum retirement age under section 8412(h). 
"(3)(A) An individual whose entitlement to an annuity under 
section 8412 or 8414 does not commence before age 62 is not entitled 
to an annuity supplement under this section. 
"(B) An individual entitled to an annuity supplement under this 
section ceases to be so entitled after the last day of the month 
preceding the first month for which such individual would, on 
proper application, be entitled to old-age insurance benefits under 
title II of the Social Security Act, but not later than the last day of 42 USC 401. 
the month in which such individual attains age 62. 
"(b)(1) The amount of the annuity supplement of an annuitant 
under this section for any month shall be equal to the product of— 
"(A) an amount determined under paragraph (2), multiplied 
by 
"(B) a fraction, as described in paragraph (3). 
"(2) The amount under this paragraph for an annuitant is an 
amount equal to the old-age insurance benefit which would be 
payable to such annuitant under title II of the Social Security Act 
(without regard to sections 203, 215(a)(7), and 215(d)(5) of such Act) 42 USC 403, 415. 
upon attaining age 62 and filing application therefor, determined as 
if the annuitant had attained such age and filed application there-
for, and were a fully insured individual (as defined in section 214(a) 
100 STAT. 534 
PUBLIC LAW 99-335—JUNE 6, 1986 
42 use 414. 
of such Act), on January 1 of the year in which such annuitant's 
entitlement to any payment under this section commences, except 
that the reduction of such old-age insurance benefit under section 
42 use 402. 
202(q) of such Act shall be the maximum applicable for an individ-
ual born in the same year as the annuitant. In computing the 
42 use 415. 
primary insurance amount under section 215 of such Act for pur-
poses of this paragraph, the number of elapsed years (referred to in 
section 215(b)(2)(B)(iii) of such Act and used to compute the number 
of benefit computation years) shall not include years beginning with 
the year in which such annuitant's entitlement to any payment 
under this section commences, and— 
"(A) only basic pay for service performed (if any) shall be 
taken into account in computing the total wages and self-
employment income of the annuitant for a benefit computation 
year; 
"(B) for a benefit computation year which commences after 
the date of the separation with respect to which entitlement to 
the annuitant's annuity under this subchapter is based and 
before the date as of which such annuitant is treated, under the 
preceding sentence, to have attained age 62, the total wages and 
self-employment income of such annuitant for such year shall 
be deemed to be zero; and 
"(C) for a benefit computation year after age 21 which pre-
cedes the separation referred to in subparagraph (B), and during 
which the individual did not perform a full year of service, the 
total wages and self-employment income of such annuitant for 
such year shall be deemed to have been an amount equal to the 
product of— 
"(i) the average total wages of all workers for that year, 
multiplied by 
"(ii) a fraction— 
"(I) the numerator of which is the total basic pay of 
the individual for service performed in the first year 
thereafter in which such individual performed a full 
year of service; and 
"(II) the denominator of which is the average total 
wages of all workers for the year referred to in 
subclause (I). 
"(3) The fraction under this paragraph for any annuitant is a 
fraction— 
"(A) the numerator of which is the annuitant's total years of 
service (rounding a fraction to the nearest whole number, with 
Vi being rounded to the next higher number), not to exceed the 
number under subparagraph (B); and 
"(B) the denominator of which is 40. 
"(4) For the purpose of this subsection— 
"(A) the term 'benefit computation year' has the meaning 
42 use 415. 
provided in section 215(b)(2)(B)(i) of the Social Security Act; 
"(B) the term 'average total wages of all workers', for a year, 
means the average of the total wages, as defined and computed 
under section 215(b)(3)(A)(ii)(I) of the Social Security Act for 
such year; and 
"(C) the term 'service' does not include military service. 
"(c) An amount under this section shall, for purposes of section 
8467, be treated in the same way as an amount computed under 
section 8415. 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 535 
"§ 8421a. Reductions on account of earnings from work performed 
5 use 842ia. 
while entitled to an annuity supplement 
"(a) The amount of the annuity supplement to which an individ-
ual is entitled under section 8421 for any month (determined with-
out regard to subsection (c) of such section) shall be reduced by the 
amount of any excess earnings of such individual which are required 
to be charged to such supplement for such month, as determined 
under subsection (b). 
"(b) The amount of an individual's excess earnings shall be 
charged to months as follows: 
"(1)(A) There shall be charged to each month of a year under 
subsection (a) an amount equal to the individual's excess earn-
ings (as determined under paragraph (2) with respect to such 
year), divided by the number of the individual's supplement 
entitlement months for such year (as determined under para-
graph (3)). 
"(B) Notwithstanding subparagraph (A), the amount charged 
to a month under subsection (a) may not exceed the amount of 
the annuity supplement to which the individual is entitled 
under section 8421 for such month (determined without regard 
to subsection (c) of such section). 
"(2) The excess earnings based on which reductions under 
subsection (a) shall be made with respect to an individual in a 
year— 
"(A) shall be equal to 50 percent of so much of such 
individual's earnings for the immediately preceding year as 
exceeds the applicable exempt amount for such preceding 
year; but 
"(B) may not exceed the total amount of the annuity 
supplement payments to which such individual was entitled 
for such preceding year under section 8421 (deterrrjned 
without regard to subsection (c) of such section, and wichout 
regard to this section). 
"(3)(A) Subject to subparagraph (B), the number of an individ-
ual's supplement entitlement months for a year shall be 12. 
"(B) The number determined under subparagraph (A) shall be 
reduced so as not to include any month after which such 
individual ceases to be entitled to an annuity supplement by 
reason of section 8421(a)(3)(B), relating to cessation of entitle-
ment upon attaining age 62. 
"(4)(A) For purposes of this section, and except as provided in 
subparagraph (B), the 'earnings' and the 'applicable exempt 
amount' of an individual shall be determined in a manner 
consistent with applicable provisions of section 203 of the Social 
Security Act. 
42 USC 403. 
"(B) For purposes of this section— 
"(i) in determining the excess earnings of any individual, 
only earnings attributable to periods during which such 
individual was entitled to an annuity supplement under 
section 8421 shall be considered; and 
"(ii) any earnings attributable to a period before attain-
ing the applicable retirement age under section 8412(h) 
shall not be considered in determining the excess earnings 
of an individual who retires under section 8412 (d) or (e), or 
section 8414(c). 
100 STAT. 536 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(c) If, after an individual ceases to be entitled to an annuity 
supplement under section 8421 by reason of subsection (a)(3)(B) of 
such section, any portion of the individual's excess earnings remains 
outstanding, an amount not to exceed 25 percent of the amount 
otherwise payable to such individual under this chapter for each 
month shall be deducted from such monthly payment until the full 
amount of that outstanding portion has been accounted for. To the 
extent practicable, reductions under this subsection shall be made 
by a level percentage. 
Regulations. 
"(d) The Office shall prescribe regulations under which this sec-
tion shall be applied in the case of a reemployed annuitant. 
5 use 8422. 
"§ 8422. Deductions from pay; contributions for military service 
"(a)(1) The employing agency shall deduct and withhold from basic 
pay of each employee and Member a percentage of basic pay deter-
mined in accordance with paragraph (2). 
"(2) The applicable percentage under this subsection for any pay 
period shall be— 
"(A) in the case of an employee (other than a law enforcement 
officer, firefighter, air traffic controller, or Congressional em-
ployee) a percentage equal to— 
"(i) 7 percent, minus 
"(ii) the percentage then in effect under section 3101(a) of 
26 use 3101. 
the Internal Revenue Code of 1954 (relating to rate of tax 
for old-age, survivors, and disability insurance); and 
"(B) in the case of a Member, law enforcement officer, fire-
fighter, air traffic controller, or Congressional employee, a 
percentage equal to— 
"(i) 7y2 percent, minus 
"(ii) the same percentage as w^ould apply in the case of an 
employee under subparagraph (A)(ii). 
"(b) Each employee or Member is deemed to consent and agree to 
the deductions under subsection (a). Notwithstanding any law or 
regulation affecting the pay of an employee or Member, payment 
less such deductions is a full and complete discharge and acquit-
tance of all claims and demands for regular services during the 
period covered by the payment, except the right to any benefits 
under this subchapter, or under subchapter IV or V of this chapter, 
based on the service of the employee or Member. 
"(c) The amounts deducted and withheld under this section shall 
be deposited in the Treasury of the United States to the credit of the 
Fund under such procedures as the Comptroller General of the 
United States may prescribe. 
"(d) Under such regulations as the Office may prescribe, amounts 
deducted under subsection (a) shall be entered on individual retire-
ment records. 
"(e)(1) Each employee or Member who has performed military 
service before the date of the separation on which the entitlement to 
any annuity under this subchapter, or subchapter V of this chapter, 
is based may pay, in accordance with such regulations as the Office 
shall issue, to the agency by which the employee is employed, or, in 
the case of a Member or a Congressional employee, to the Secretary 
of the Senate or the Clerk of the House of Representatives, as 
appropriate, an amount equal to 3 percent of the amount of the 
basic pay paid under section 204 of title 37 to the employee or 
Member for each period of military service after December 1956. 
The amount of such payments shall be based on such evidence of 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 537 
basic pay for military service as the employee or Member may 
provide, or if the Office determines sufficient evidence has not been 
so provided to adequately determine basic pay for military service, 
such payment shall be based on estimates of such basic pay provided 
to the Office under paragraph (4). 
"(2) Any deposit made under paragraph (1) more than two years 
after the later o
f
— 
"(A) January 1,1987; or 
"(B) the date on which the employee or Member making the 
deposit first becomes an employee or Member, 
shall include interest on such amount computed and compounded 
annually beginning on the date of the expiration of the two-year 
period. The interest rate that is applicable in computing interest in 
any year under this paragraph shall be equal to the interest rate 
that is applicable for such year under section 8334(e). 
"(3) Any payment received by an agency, the Secretary of the 
Senate, or the Clerk of the House of Representatives under this 
subsection shall be immediately remitted to the Office for deposit in 
the Treasury of the United States to the credit of the Fund. 
"(4) The Secretary of Defense, the Secretary of Transportation, 
the Secretary of Commerce, or the Secretary of Health and Human 
Services, as appropriate, shall furnish such information to the Office 
as the Office may determine to be necessary for the administration 
of this subsection. 
"§ 8423. Government contributions 
5 USC 8423. 
"(a)(1) Each employing agency having any employees or Members 
subject to section 8422(a) shall contribute to the Fund an amount 
equal to the sum of— 
"(A) the product of— 
"(i) the normal-cost percentage, as determined 
for 
employees (other than employees covered by subparagraph 
(B)), multiplied by 
"(ii) the aggregate amount of basic pay payable by the 
agency, for the period involved, to employees (under clause 
(i)) who are within such agency; and 
"(B) the product of— 
"(i) the normal-cost percentage, as determined for Mem-
bers, Congressional employees, law enforcement officers, 
firefighters, air traffic controllers, military reserve techni-
cians, and employees under sections 302 and 303 of the 
Central Intelligence Agency Retirement Act of 1964 for Post, pp. 625, 
Certain Employees, multipled by 
626. 
"(ii) the aggregate amount of basic pay payable by the 
agency, for the period involved, to employees and Members 
(under clause (i)) who are within such agency. 
"(2) In determining any normal-cost percentage to be applied 
under this subsection, amounts provided for under section 8422 shall 
be taken into account. 
"(3) Contributions under this subsection shall be paid— 
"(A) in the case of law enforcement officers, firefighters, air 
traffic controllers, military reserve technicians, and other 
employees, from the appropriation or fund used to pay such law 
enforcement officers, firefighters, air traffic controllers, mili-
tary reserve technicians, or other employees, respectively; 
100 STAT. 538 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(B) in the case of elected officials, from an appropriation or 
fund available for payment of other salaries of the same office 
or establishment; and 
"(C) in the case of employees of the legislative branch paid by 
the Clerk of the House of Representatives, from the contingent 
fund of the House. 
"(4) A contribution to the Fund under this subsection shall be 
deposited under such procedures as the Comptroller General of the 
United States may prescribe. 
"(b)(1) The Office shall compute— 
"(A) the amount of the supplemental liability of the Fund 
with respect to individuals other than those to whom subpara-
graph (B) relates, and 
"(B) the amount of the supplemental liability of the Fund 
with respect to current or former employees of the United 
States Postal Service (and the Postal Rate Commission) and 
their survivors; 
as of the close of each fiscal year beginning after September 30, 
1987. 
"(2) The amount of any supplemental liability computed under 
paragraph (1)(A) or (1)(B) shall be amortized in 30 equal annual 
installments, with interest computed at the rate used in the most 
recent valuation of the System. 
"(3) At the end of each fiscal year, the Office shall notify— 
"(A) the Secretary of the Treasury of the amount of the 
installment computed under this subsection for such year with 
respect to individuals under paragraph (1)(A); and 
"(B) the Postmaster General of the United States of the 
amount of the installment computed under this subsection for 
such year with respect to individuals under paragraph (1)(B). 
"(4)(A) Before closing the accounts for a fiscal year, the Secretary 
of the Treasury shall credit to the Fund, as a Government contribu-
tion, out of any money in the Treasury of the United States not 
otherwise appropriated, the amount under paragraph (3)(A) for such 
year. 
"(B) Upon receiving notification under paragraph (3)(B), the 
United States Postal Service shall pay the amount specified in such 
notification to the Fund. 
"(5) For the purpose of carrying out paragraph (1) with respect to 
any fiscal year, the Office may— 
"(A) require the Board of Actuaries of the Civil Service 
Retirement System to make actuarial determinations and valu-
ations, make recommendations, and maintain records in the 
same manner as provided in section 8347(f); and 
"(B) use the latest actuarial determinations and valuations 
made by such Board of Actuaries. 
"(c) Under regulations prescribed by the Office, the head of an 
agency may request reconsideration of any amount determined to be 
payable with respect to such agency under subsection (a) or (b). Any 
such request shall be referred to the Board of Actuaries of the Civil 
Service Retirement System. The Board of Actuaries shall review the 
computations of the Office and may make any adjustment with 
respect to any such amount which the Board determines appro-
priate. A determination by the Board of Actuaries under this subsec-
tion shall be final. 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 539 
"§ 8424. Lump-sum benefits; designation of beneficiary; order of 
5 USC 8424. 
precedence 
"(a) Subject to subsection (b), an employee or Member who— 
"(1)(A) is separated from the service for at least 31 consecutive 
days; or 
"(B) is transferred to a position in which the individual is not 
subject to this chapter and remains in such a position for at 
least 31 consecutive days; 
"(2) files an application with the Office for payment of the 
lump-sum credit; 
"(3) is not reemployed in a position in which the individual is 
subject to this chapter at the time of filing the application; and 
"(4) will not become eligible to receive an annuity within 31 
days after filing the application; 
is entitled to be paid the lump-sum credit. Except £is provided in 
section 8420a, payment of the lump-sum credit to an employee or 
Member voids all annuity rights under this subchapter, and sub-
chapters IV and V of this chapter, based on the service on which the 
lump-sum credit is based. 
"(b)(1) Payment of the lump-sum credit under subsection (a)— 
"(A) may be made only if any current spouse and any former 
spouse of the employee or Member are notified of the applica-
tion by the employee or Member; and 
"(B) in any case in which there is a former spouse, shall be 
subject to the terms of a court decree of divorce, annulment, or 
legal separation issued with respect to such former spouse if— 
"(i) the decree expressly relates to any portion of the 
lump-sum credit involved; and 
"(ii) payment of the lump-sum credit would affect any 
right or interest of the former spouse with respect to a 
survivor annuity under section 8445, or to any portion of an 
annuity under section 8467. 
"(2)(A) Notification of a spouse or former spouse under this subsec- Regulations. 
tion shall be made in accordance with such requirements as the 
Office shall by regulation prescribe. 
"(B) Under the regulations, the Office may provide that para-
graph (1)(A) may be waived with respect to a spouse or former 
spouse if the employee or Member establishes to the satisfaction of 
the Office that the whereabouts of such spouse or former spouse 
cannot be determined. 
"(3) The Office shall prescribe regulations under which this Regulations. 
subsection shall be applied in any case in which the Office receives 
two or more orders or decrees referred to in paragraph (l)(B)(i). 
"(c) Under regulations prescribed by the Office, an employee or 
Member, or a former employee or Member, may designate one or 
more beneficiaries under this section. 
"(d) Lump-sum benefits authorized by subsections (e) through (g) 
shall be paid to the individual or individuals surviving the employee 
or Member and alive at the date title to the payment arises in the 
following order of precedence, and the payment bars recovery by 
any other individual: 
"First, to the beneficiary or beneficiaries designated by the 
employee or Member in a signed and witnessed writing received 
in the Office before the death of such employee or Member. For 
this purpose, a designation, change, or cancellation of bene-
100 STAT. 540 
PUBLIC LAW 99-335—JUNE 6, 1986 
ficiary in a will or other document not so executed and filed has 
no force or effect. 
"Second, if there is no designated beneficiary, to the widow or 
widower of the employee or Member. 
"Third, if none of the above, to the child or children of the 
employee or Member and descendants of deceased children by 
representation. 
"Fourth, if none of the above, to the parents of the employee 
or Member or the survivor of them. 
"Fifth, if none of the above, to the duly appointed executor or 
administrator of the estate of the employee or Member. 
"Sixth, if none of the above, to such other next of kin of the 
employee or Member as the Office determines to be entitled 
under the laws of the domicile of the employee or Member at 
the date of death of the employee or Member. 
For the purpose of this subsection, 'child' includes a natural child 
and an adopted child, but does not include a stepchild. 
"(e) If an employee or Member, or former employee or Member, 
dies— 
"(1) without a survivor, or 
"(2) with a survivor or survivors and the right of all survivors 
under subchapter IV terminates before a claim for survivor 
annuity under such subchapter is filed, 
the lump-sum credit shall be paid. 
"(f) If all annuity rights under this chapter (other than under 
subchapter III of this chapter) based on the service of a deceased 
employee or Member terminate before the total annuity paid equals 
the lump-sum credit, the difference shall be paid. 
"(g) If an annuitant dies, annuity accrued and unpaid shall be 
paid. 
"(h) Annuity accrued and unpaid on the termination, except by 
death, of the annuity of an annuitant or survivor shall be paid to 
that individual. Annuity accrued and unpaid on the death of a 
survivor shall be paid in the following order of precedence, and the 
payment bars recovery by any other person: 
"First, to the duly appointed executor or administrator of the 
estate of the survivor. 
"Second, if there is no executor or administrator, payment 
may be made, after 30 days from the date of death of the 
survivor, to such next of kin of the survivor as the Office 
determines to be entitled under the laws of the domicile of the 
survivor at the date of death. 
5 use 8425. 
"§ 8425. Mandatory separation 
"(a) An air traffic controller who is otherwise eligible for imme-
diate retirement under section 8412(e) shall be separated from the 
service on the last day of the month in which that air traffic 
controller becomes 56 years of age or completes 20 years of service if 
then over that age. The Secretary, under such regulations as the 
Secretary may prescribe, may exempt a controller having excep-
tional skills and experience as a controller from the automatic 
separation provisions of this subsection until that controller be-
comes 61 years of age. The Secretary shall notify the controller in 
writing of the date of separation at least 60 days before that date. 
Action to separate the controller is not effective, without the con-
sent of the controller, until the last day of the month in which the 
60-day notice expires. 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 541 
"(b) A law enforcement officer or firefighter who is otherwise 
eligible for immediate retirement under section 8412(d) shall be 
separated from the service on the last day of the month in which 
that law enforcement officer or firefighter becomes 55 years of age 
or completes 20 years of service if then over that age. If the head of 
the agency judges that the public interest so requires, that agency 
head may exempt such an employee from automatic separation 
under this subsection until that employee becomes 60 years of age. 
The employing office shall notify the employee in writing of the date 
of separation at least 60 days before that date. Action to separate 
the employee is not effective, without the consent of the employee, 
until the last day of the month in which the 60-day notice expires. 
"(c) The President, by Executive order, may exempt an employee President of U.S. 
from automatic separation under this section if the President deter-
mines the public interest so requires. 
"SUBCHAPTER III—THRIFT SAVINGS PLAN 
"§ 8431. Definition 
5 USC 8431. 
"Notwithstanding section 8401 of this, title, for the purpose of this 
subchapter, the term 'basic pay', when used with respect to an 
employee or Member, means the bgisic pay of the employee or 
Member established pursuant to law, without regard to any provi-
sion of law (except sections 5308 and 538200) of this title) limiting the 
rate of pay actually payable in any pay period (including any 
provision of law restricting the use of appropriated funds). 
"§ 8432. Contributions 
5 USC 8432. 
"(a) An employee or Member may contribute to the Thrift Savings 
Fund in any pay period, pursuant to an election under subsection 
Ot>)(l), an amount not to exceed 10 percent of such individual's basic 
pay for such period. Contributions made under this subsection 
during any 6-month period for which an election period is provided 
under subsection 0))(1) shall be made each pay period during 
such 6-month period pursuant to a program of regular contributions 
provided in regulations prescribed by the Executive Director. 
"(b)(1)(A) The Executive Director shall prescribe regulations under Regulations, 
which employees and Members shall be afforded a reasonable period 
every 6 months to elect to make contributions under subsection (a), 
to modify the amount to be contributed under such subsection, or to 
terminate such contributions. An election to make such contribu-
tions shall remain in effect until modified or terminated. 
"(B) The amount to be contributed pursuant to an election under 
subparagraph (A) shall be the percentage of bgisic pay or amount 
designated by the employee or Member. 
"(2) Under the regulations— 
"(A) an employee or Member who has not previously been 
eligible to make an election under this subsection shall not 
become so eligible until the second period (described in para-
graph (D) beginning after the date of commencing service as an 
employee or Member; 
"(B) an employee or Member whose appointment or election 
to a position or office in the Federal Government follows a 
previous period of service during which that individual met the 
requirements of subparagraph (A) shall be eligible to make an 
100 STAT. 542 
PUBLIC LAW 99-335—JUNE 6, 1986 
election under this subsection notwithstanding any period of 
separation; 
"(C) an employee or Member who elects under subparagraph 
(D) to terminate contributions shall not again become eligible to 
make an election under this subsection until the second period 
(described in paragraph (1)) commencing after the election to 
terminate; and 
"(D) an election to terminate may be made under this 
subparagraph at any time other than during a period afforded 
under paragraph (1). 
"(3) Notwithstanding paragraph (2)(A), an employee or Member 
who elects to become subject to this chapter under section 301 of the 
Federal Employees' Retirement System Act of 1986 may make the 
first election for the purpose of subsection (a) during the period 
prescribed for such purpose by the Executive Director. The period 
prescribed by the Executive Director shall commence on the date on 
which the employee or Member makes the election to become 
subject to this chapter. 
"(4) Notwithstanding paragraph (2XA), an employee or Member 
who is an employee or Member on January 1, 1987, and has cred-
itable service described in section 8411(b)(2) of this title may make 
the first election for the purpose of subsection (a) during the election 
period prescribed for such purpose by the Executive Director. The 
Executive Director shall prescribe an election period for such pur-
pose which shall commence on January 1, 1987. An election by such 
an employee or Member during that election period shall be effec-
tive on the first day of the employee's or Member's first pay period 
which begins after the last day of that election period. 
"(c)(1) At the end of the pay period that includes the first date on 
which an employee or Member may make contributions under 
subsection (a) (without regard to whether the employee or Member 
has elected to make such contributions during such pay period), and 
at the end of each succeeding pay period, the employing agency shall 
contribute to the Thrift Savings Fund for the benefit of such 
employee or Member the amount equal to 1 percent of the bsisic pay 
of such employee or Member for such pay period. 
"(2)(A) In addition to contributions made under paragraph (1), the 
employing agency of an employee or Member who contributes to the 
Thrift Savings Fund under subsection (a) for any pay period shall 
make a contribution to the Thrift Savings Fund for the benefit of 
such employee or Member. The employing agency's contribution 
shall be made at the end of such pay period. 
"(B) The amount contributed under subparagraph (A) by an 
employing agency with respect to a contribution of an employee or 
Member during any pay period shall be the amount equal to the 
sum of— 
"(i) such portion of the total amount of the employee's or 
Member's contribution as does not exceed 3 percent of such 
employee's or Member's basic pay for such period; and 
"(ii) one-half of such portion of the amount of the employee's 
or Member's contribution as exceeds 3 percent, but does not 
exceed 5 percent, of such employee's or Member's basic pay for 
such pay period. 
"(3)(A) There shall be contributed to the Thrift Savings Fund on 
behalf of each employee or Member described in subparagraph (B) 
the amount determined under subparagraph (C). 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 543 
"(B) An employee or Member referred to in subparagraph (A) is an 
employee or Member who— 
"(i) is an employee or Member on January 1,1987; 
"(ii) has creditable service described in section 8411(bX2) of 
this title; and 
"(iii) has not received a refund of the amount of the retire-
ment deductions made with respect to such service under sec-
tion 204 of the Federal Employees' Retirement Contribution 
Temporary Adjustment Act of 1983. 
5 USC 8331 note. 
"(C) The amount referred to in subparagraph (A) in the case of an 
employee or Member is equal to the sum of— 
"(i) 1 percent of the total basic pay paid to such employee or 
Member for service described in section 8411(b)(2) of this title; 
and 
"(ii) interest on such amount computed with respect to such 
service in the manner provided in paragraphs (2) and (3) of 
section 8334(e) of this title. 
"(D) The Secretary of the Treasury shall credit to the Thrift 
Savings Fund, out of any sums in the Treasury not otherwise 
appropriated, the amounts determined by the Director to be nec-
essary to carry out this paragraph. 
"(d) Notwithstanding any other provision of this section, no con-
tribution may be made under this section for any year to the extent 
that such contribution, when added to prior contributions for such 
year, exceeds any limitation under section 415 of the Internal 
Revenue Code of 1954. 
26 USC 415. 
"(e) The sums required to be contributed to the Thrift Savings 
Fund by an employing agency under subsection (c) for the benefit of 
an employee or Member shall be paid from the appropriation or 
fund available to such agency for payment of salaries of the 
employee's or Member's office or establishment. When an employee 
or Member in the legislative branch is paid by the Clerk of the 
House of Representatives, the Clerk may pay from the contingent 
fund of the House of Representatives the contribution that other-
wise would be contributed from the appropriation or fund used to 
pay the employee or Member. 
"(f) Amounts contributed by an employee or Member under 
subsection (a) and amounts contributed with respect to such em-
ployee or Member under subsection (c) shall be deposited in the 
Thrift Savings Fund to the credit of that employee's or Member's 
account in accordance with such procedures as the Comptroller 
General of the United States may, in consultation with the Execu-
tive Director, prescribe in regulations. 
"(g)(1) Except as provided in paragraphs (2) and (3), all contribu-
tions made under this section shall be fully nonforfeitable when 
made. 
"(2) Contributions made for the benefit of an employee under 
subsection (c)(1) and all earnings attributable to such contributions 
shall be forfeited if the employee separates from Government 
employment before completing— 
"(A) 2 years of civilian service in the case of an employee who, 
at the time of separation, is serving in— 
"(i) a position in the Senior Executive Service as a non-
career appointee (as defined in section 3132(a)(7) of this 
title); 
100 STAT. 544 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(ii) a position listed in section 5312, 5313, 5314, 5315, or 
5316 of this title or a position placed in level IV or V of the 
Executive Schedule under section 5317 of this title; or 
"(iii) a position in the Executive branch which is excepted 
from the competitive service by the Office by reason of the 
confidential and policy-determining character of the posi-
tion; or 
"(B) 3 years of civilian service in the case of an employee who 
is not serving in a position described in subparagraph (A) at the 
time of separation. 
"(3) Contributions made for the benefit of a Member or Congres-
sional employee under subsection (c)(1) and all earnings attributable 
to such contributions shall be forfeited if the Member or Congres-
sional employee separates from Government employment before 
completing 2 years of civilian service. 
"(h) No transfers or contributions may be made to the Thrift 
Savings Fund except as provided in this chapter or section 8351 of 
this title. 
5 use 8433. 
"§ 8433. Benefits and election of benefits 
"(a) An employee or Member who separates from Government 
employment is entitled to the amount of the balance in the 
employee's or Member's account (except for the portion of such 
amount forfeited under section 8432(g) of this title, if any) as pro-
vided in this section. 
"(b) Subject to section 8435 of this title, any employee or Member 
who separates from Government employment entitled to an imme-
diate annuity under subchapter II of this chapter, any employee or 
Member who separates from Government employment entitled to 
5 use 8101. 
benefits under subchapter I of chapter 81 of this title, and any 
employee or Member who is entitled to receive disability benefits 
under subchapter V of this chapter is entitled and may elect— 
"(1) to receive an immediate annuity from the Thrift Savings 
Fund; 
"(2) to defer the commencement of the payment of an annuity 
from the Thrift Savings Fund until such date as the employee 
or Member specifies, but not later than April 1 of the year 
following the year in which the employee or Member becomes 
70 V
2 years of age; 
"(3) to withdraw the amount of the balance in the employee's 
or Member's account in the Thrift Savings Fund in one or more 
substantially equal payments to be made not less frequently 
than annually and to commence before April 1 of the year 
following the year in which the employee or Member becomes 
70 V
2 years of age; or 
"(4) to transfer the amount of the balance in the employee's 
or Member's account to an eligible retirement plan as provided 
in subsection (e). 
"(c) Subject to section 8435 of this title, any employee or Member 
who separates from Government employment entitled to a deferred 
annuity under subchapter II of this chapter is entitled and may 
elect— 
"(1) to receive an immediate annuity from the Thrift Savings 
Fund; 
"(2) to defer the commencement of the payment of an annuity 
from the Thrift Savings Fund until such date as the employee 
or Member specifies, but not later than April 1 of the year 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 545 
following the year in which the employee or Member becomes 
70 ¥2 years of age; 
"(3) to withdraw the amount of the balance in the employee's 
or Member's account in the Thrift Savings Fund in one or more 
substantially equal payments to be made not less frequently 
than annually and to commence during any period which (A) 
commences on or after the date on which payment of the 
employee's or Member's annuity under subchapter II of this 
chapter commences, and (B) ends not later than April 1 of the 
year following the year in which the employee or Member 
becomes lOVz years of age; or 
"(4) to trahsfer the amount of the balance in the employee's 
or Member's account to an eligible retirement plan as provided 
in subsection (e). 
"(d) Subject to section 8435 of this title, any employee or Member 
who separates from Government employment before becoming en-
titled to a deferred annuity under subchapter II of this chapter shall 
transfer the amount of the balance in the employee's or Member's 
account to an eligible retirement plan as provided in subsection (e). 
"(e)(1) The Executive Director shall make each transfer elected 
under subsection Ot))(4) or (c)(4) or required under subsection (d) 
directly to an eligible retirement plan or plans (as defined in section 
402(a)(5)(E) of the Internal Revenue Code of 1954) identified by the 
26 USC 402. 
employee, Member, former employee, or former Member for whom 
the transfer is made. 
"(2) A transfer may not be made for an employee. Member, former 
employee, or former Member under paragraph (1) until the Execu-
tive Director receives from that individual the information required 
by the Executive Director specifically to identify the eligible retire-
ment plan or plans to which the transfer is to be made. 
"(f)(1) Subject to paragraph (3)(A) and subsections (a) and (d) of 
section 8435 of this title, an employee or Member may change an 
election previously made under this subchapter. 
"(2) Subject to paragraph (3)(B) and section 8435(d) of this title, a 
former employee or Member who has made an election pursuant to 
subsection Ot))(2) or (c)(2) may modify the date specified in such 
election or in a previous modification under this paragraph. 
"(3)(A) A former employee or Member may not change an election 
under this section on or after the date on which a payment is made 
in accordance with such election or, in the case of an election to 
receive an annuity, the date on which an annuity elected by the 
former employee or Member commences. 
"(B) A modification of a date may not be made under paragraph 
(2) on or after such date and may not specify a date for the 
commencement of an annuity earlier than 1 month after the date on 
which the modification is submitted to the Executive Director. 
"(g) If an employee or Member (or former employee or Member) 
dies without having made an election under this section or after 
having elected an annuity under this section but before making an 
election under section 8434 of this title, an amount equal to the 
value of that individual's account (as of death) shall, subject to any 
decree, order, or agreement referred to in section 8435(d)(2) of this 
title be paid in a manner consistent with section 8424(d) of this title. 
"(h) Unless otherwise elected under this section, benefits under 
this subchapter shall be paid as an annuity commencing for an 
employee. Member, former employee, or former Member on Feb-
ruary 1 of the year following the latest of the year in which— 
rt
1
Por-V 1
100 STAT. 546 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(1) the employee, Member, former employee, or former 
Member becomes 65 years of age; 
"(2) occurs the tenth anniversary of the year in which the 
employee, Member, former employee, or former Member 
became subject to this subchapter; or 
"(3) the employee, Member, former employee, or former 
Member separates from Government employment. 
"(i)(l) At any time after December 31,1987, and before separation, 
an employee or Member may apply to the Board for permission to 
borrow from the employee's or Member's account an amount not 
exceeding the value of that portion of such account which is attrib-
utable to contributions made by the employee or Member under 
section 8432(a) of this title. 
"(2) An application under this subsection may be approved only 
for— 
"(A) the purchase of a primary residence; 
"(B) educational expenses; 
"(C) medical expenses; or 
"(D) financial hardship. 
"(3) Loans under this subsection shall be subject to such conditions 
as the Board may prescribe consistent with section 408(bXl) of the 
Employee Retirement Income Security Act of 1974 (29 U.S.C. 
1108(b)(1)). The conditions shall be included in regulations issued by 
the Executive Director. 
"(4) A loan may not be made under this subsection to the extent 
that the loan would be treated as a taxable distribution under 
26 use 72. 
section 72(p) of the Internal Revenue Code of 1954. 
"(5) A loan may not be made under this subsection unless the 
requirements of section 8435(0 of this title are satisfied. 
5 use 8434. 
"§ 8434. Annuities: methods of payment; election; purchase 
"(a)(1) The Board shall prescribe methods of payment of annuities 
under this subchapter. 
"(2) The methods of payment prescribed under paragraph (1) shall 
include, but not be limited to— 
"(A) a method which provides for the payment of a monthly 
annuity only to an annuitant during the life of the annuitant; 
"(B) a method which provides for the payment of a monthly 
annuity to an annuitant for the joint lives of the annuitant and 
the spouse of the annuitant and an appropriate monthly annu-
ity to the one of them who survives the other of them for the life 
of the survivor; 
"(C) a method described in subparagraph (A) which provides 
annual increases in the amount of the annuity payable; 
"(D) a method described in subparagraph (B) which provides 
annual increases in the amount of the annuity payable; and 
"(E) a method which provides for the payment of a monthly 
annuity— 
(i) to the annuitant for the joint lives of the annuitant 
and an individual who is designated by the annuitant under 
regulations prescribed by the Executive Director and (I) is a 
former spouse of the annuitant, or (II) has an insurable 
interest in the annuitant; and 
"(ii) to the one of them who survives the other of them for 
the life of the survivor. 
Regulations. 
"(b) Subject to section 8435(c) of this title, under such regulations 
as the Executive Director shall prescribe, an employee, Member, 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 547 
former employee, or former Member who elects under section 8433 
of this title to receive an annuity under this subchapter shall elect, 
on or before the date on which the annuity commences, one of the 
methods of payment prescribed under subsection (a). 
"(c) Notwithstanding an elimination of a method of payment by 
the Board— 
"(1) an employee. Member, former employee, or former 
Member who is entitled under section 8412 of this title to an 
immediate annuity not reduced under section 8415(f) of this title 
may elect the eliminated method if the elimination of such 
method became effective less than 5 years before the date on 
which the annuity commences; and 
"(2) any other employee. Member, former employee, or former 
Member may elect such method of payment for amounts 
contributed by or on behalf of the employee, Member, former 
employee, or former Member under section 8432 of this title 
before such effective date and for earnings attributable to such 
amounts. 
"(d)(1) At the time an annuity is to commence under this sub-
chapter, the Executive Director shall expend the balance in the 
annuitant's account to purchase an annuity contract from any 
entity which, in the normal course of its business, sells and provides 
annuities. 
"(2) The Executive Director shall assure, by contract entered into 
Contracts. 
with each entity from which an annuity contract is purchased under 
paragraph (1), that the annuity shall be provided in accordance with 
the provisions of this subchapter and subchapter VII of this chapter. 
"(3) An annuity contract purchased under paragraph (1) shall 
include such terms and conditions as the Executive Director re-
quires for the protection of the annuitant. 
"(4) The Executive Director shall require, from each entity from 
which an annuity contract is purchased under paragraph (1), a bond 
or proof of financial responsibility sufficient 
to protect the 
annuitant. 
"§ 8435. Protections for spouses and former spouses 
5 USC 8435. 
"(a)(1)(A) A married employee or Member (or former employee or 
Member) may make an election under subsection (b)(3), (b)(4), (c)(3), 
or (c)(4) of section 8433 of this title or change an election previously 
made under subsection (b)(1), (b)(2), (cXD, or (c)(2) of such section 
only if the employee or Member (or former employee or Member) 
satisfies the requirements of subparagraph (B). 
"(B) An employee or Member (or former employee or Member) 
may make an election or change referred to in subparagraph (A) if 
the employee or Member and the employee's or Member's spouse (or 
the former employee or Member and the former employee's or 
Member's spouse) jointly waive, by written election, any right which 
the spouse may have to a survivor annuity with respect to such 
employee or Member (or former employee or Member) under section 
8434 of this title or subsection (c). 
"(2) Paragraph (1) shall not apply to an election or change of 
election by an employee or Member (or former employee or Member) 
who establishes to the satisfaction of the Executive Director (at the 
time of the election or change and in accordance with regulations 
prescribed by the Executive Director)— 
"(A) that the spouse's whereabouts cannot be determined; or 
100 STAT. 548 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(B) that, due to exceptional circumstances, requiring the 
spouse's waiver would otherwise be inappropriate. 
"(b)(1) Except as provided in paragraph (2), a transfer may be 
made by an employee or Member (or former employee or Member) 
under section 8433(d) of this title only after the Executive Director 
notifies any current spouse and each former spouse of the employee 
or Member (or former employee or Member), if any, that the trans-
fer is to be made. 
"(2) Paragraph (1) may be waived with respect to a spouse or 
former spouse if the employee or Member (or former employee or 
Member) establishes to the satisfaction of the Executive Director 
that the whereabouts of such spouse or former spouse cannot be 
determined. 
"(c)(1) Notwithstanding any election under subsection (b) of sec-
tion 8434 of this title, the method described in subsection (a)(2)(B) of 
such section (or, if more than one form of such method is available, 
the form which the Board determines to be the one which provides 
for a surviving spouse a survivor annuity most closely approximat-
ing the annuity of a surviving spouse under section 8442 of this title) 
shall be deemed the applicable method under such subsection (b) in 
the case of an employee. Member, former employee, or former 
Member who is married on the date on which the employee's. 
Member's, former employee's, or former Member's annuity com-
mences under this subchapter. 
"(2) Paragraph (1) shall not apply— 
"(A) in the case of an employee or Member retiring under 
section 8412, 8413, 8414, or 8451 of this title if— 
"(i) a joint waiver of such method is made, in writing, by 
the employee or Member and the spouse; or 
"(ii) the employee or Member waives such method, in 
writing, after establishing to the satisfaction of the Execu-
tive Director that circumstances described in subsection 
(a)(2)(A) or (a)(2)(B) make the requirement of a joint waiver 
inappropriate; or 
"(B) in the case of an employee or Member not covered by 
subparagraph (A), if the employee or Member waives such 
method after— 
"(i) having provided notification to the spouse of intent to 
waive; or 
"(ii) establishing to the satisfaction of the Executive 
Director that the whereabouts of such spouse cannot be 
determined. 
"(d)(1) An election, change of election, or modification of the 
commencement date of a deferred annuity shall not be effective 
under this subchapter and a transfer may not be made under section 
8433(d) of this title to the extent that the election, change, modifica-
tion, or transfer conflicts with any court decree, order, or agreement 
described in paragraph (2). 
"(2) A court decree, order, or agreement referred to in paragraph 
(1) is, with respect to an employee or Member (or former employee 
or Member), a court decree of divorce, annulment, or legal separa-
tion issued in the case of such employee or Member (or former 
employee or Member) and any former spouse of the employee or 
Member (or former employee or Member) or any court order or 
court-approved property settlement agreement incident to such 
decree i
f
— 
PUBLIC LAW 99-335~JUNE 6, 1986 
100 STAT. 549 
"(A) the decree, order, or agreement expressly relates to any 
portion of the balance in the employee's or Member's (or former 
employee's or Member's) account; and 
"(B) notice of the decree, order, or agreement was received by 
the Executive Director before— 
"(i) the date on which payment is made, or 
"(ii) in the case of an annuity, the date on which the 
annuity commences, 
in accordance with the election, change, modification, or con-
tribution referred to in paragraph (1). 
"(3) The Executive Director shall prescribe regulations under 
Regulations. 
which this subsection shall be applied in any case in which the 
Executive Director receives two or more decrees, orders, or agree-
ments referred to in paragraph (1). 
"(e)(1) Subject to paragraphs (2) through (7), a former spouse of a 
deceased employee or Member (or a deceased former employee or 
Member) who died after performing 18 or more months of service 
and a former spouse of a deceased former employee or Member who 
died entitled to an immediate or deferred annuity under subchapter 
II of this chapter is entitled to a survivor annuity under this 
subsection if and to the extent that— 
"(A) an election under section 8434(a)(2)(E) of this title, or 
"(B) any court decree, order, or agreement (described in 
subsection (d)(2), without regard to subparagraph (B) of such 
subsection) which relates to such deceased individual and such 
former spouse, 
expressly provides for such survivor annuity. 
"(2) Paragraph (1) shall apply only to payments made by the 
Executive Director after the date on which the Executive Director 
receives written notice of the election, decree, order, or agreement, 
and such additional information and documentation as the Execu-
tive Director may require. 
"(3) The amount of the survivor annuity payable from the Thrift 
Savings Fund to a former spouse of a deceased employee. Member, 
former employee, or former Member under this section may not 
exceed the excess, if any, of— 
"(A) the amount of the survivor annuity determined for a 
surviving spouse of the deceased employee, Member, former 
employee, or former Member under the method described in 
subsection (c)(1), over 
"(B) the total amount of all other survivor annuities payable 
under this subchapter to other former spouses of such deceased 
employee. Member, former employee, or former Member based 
on the order of precedence provided in paragraph (4). 
"(4) If more than one former spouse of a deceased employee, 
Member, former employee, or former Member is entitled to a survi-
vor annuity pursuant to this subsection, the amount of each such 
survivor annuity shall be limited appropriately to carry out para-
graph (3) in the order of precedence established for the entitlements 
by the chronological order of the dates on which elections are 
properly made pursuant to section 8434(a)(2)(E) of this title and the 
dates on which the court decrees, orders, or agreements applicable 
to the entitlement were issued, as the case may be. 
"(5) Subsections (c) and (d) of section 8445 of this title shall apply 
to an entitlement of a former spouse to a survivor annuity under 
this subsection. 
100 STAT. 550 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(6) For the purposes of this section, a court decree, order, or 
agreement or an election referred to in subsection (a) of this section 
shall not be effective, in the case of a former spouse, to the extent 
that the election is inconsistent with any joint waiver previously 
executed with respect to such former spouse under subsection (aX2) 
or (c)(2). 
"(7) Any payment under this subsection to any individual bars 
recovery by any other individual. 
Loans. 
"(f)(1)(A) A loan may be made to a married employee or Member 
under section 8433(i) of this title only if the employee's or Member's 
spouse consents to such loan in writing. 
"(B) A consent under subparagraph (A) shall be irrevocable with 
respect to the loan to which the consent relates. 
"(C) Subparagraph (A) shall not apply to a loan to an employee or 
Member who establishes to the satisfaction of the Executive Direc-
tor (at the time the employee or Member applies for such loan and 
in accordance with regulations prescribed by the Executive 
Director)— 
"(i) that the spouse's whereabouts cannot be determined; or 
"(ii) that, due to exceptional circumstances, requiring the 
employee or Member to seek the spouse's consent would other-
wise be inappropriate. 
"(2) An application for a loan under section 8433(i) of this title 
shall not be approved if approval would have the result described in 
subsection (d)(1). 
"(g) Waivers and notifications required by this section and waivers 
of the requirements for such waivers and notifications (as 
authorized by this section) may be made only in accordance with 
procedures prescribed by the Executive Director. 
"(h) The protections provided by this section are in addition to the 
protections provided by section 8467 of this title. 
5 use 8436. 
"§ 8436. Administrative provisions 
"(a) The Executive Director shall make or provide for payments 
and transfers in accordance with an election of an employee or 
Member under section 8433 or 8434(b) of this title or, if applicable, in 
accordance with section 8435 of this title. 
"(b) Any election, change of election, or modification of a deferred 
annuity commencement date made under this subchapter shall be in 
writing and shall be filed with the Executive Director in accordance 
with regulations prescribed by the Executive Director. 
5 use 8437 
"§ 8437. Thrift Savings Fund 
"(a) There is established in the Treasury of the United States a 
Thrift Savings Fund. 
"(b) The Thrift Savings Fund consists of the sum of all amounts 
contributed under section 8432 of this title and all amounts depos-
ited under section 8479(b) of this title, increased by the total net 
earnings from investments of sums in the Thrift Savings Fund or 
reduced by the total net losses from investments of the Thrift 
Savings Fund, and reduced by the total amount of payments made 
from the Thrift Savings Fund (including payments for administra-
tive expenses). 
"(c) The sums in the Thrift Savings Fund are appropriated and 
shall remain available without fiscal year limitation— 
"(1) to invest under section 8438 of this title; 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 551 
"(2) to pay benefits or purchase annuity contracts under this 
subchapter; 
"(3) to pay the administrative expenses of the Federal Retire-
ment Thrift Investment Management System prescribed in 
subchapter VII of this chapter; 
"(4) to make distributions for the purposes of section 84400)) 
of this title; 
"(5) to make loans to employees and Members as authorized 
under section 8433(i) of this title; and 
"(6) to purchase insurance as provided in section 84790t))(2) of 
this title. 
"(d) Administrative expenses incurred to carry out this sub-
chapter and subchapter VII of this chapter shall be paid first out of 
any sums in the Thrift Savings Fund forfeited under section 8432(g) 
of this title and then out of net earnings in such Fund attributable 
to sums contributed to such Fund under section 8432(c) of this title. 
"(e)(1) Subject to paragraphs (2) and (3), sums in the Thrift Savings 
Fund credited to the account of an employee, Member, former 
employee, or former Member may not be used for, or diverted to, 
purposes other than for the exclusive benefit of the employee, 
Member, former employee, or former Member or his beneficiaries 
under this subchapter. 
"(2) Except as provided in paragraph (3), sums in the Thrift 
Savings Fund may not be assigned or alienated and are not subject 
to execution, levy, attachment, garnishment, or other legal process. 
For the purposes of this paragraph, a loan made from such Fund to 
an employee or Member shall not be considered to be an assignment 
or alienation. 
"(3) Moneys due or payable from the Thrift Savings Fund to any 
individual and, in the case of an individual who is an employee or 
Member (or former employee or Member), the balance in the ac-
count of the employee or Member (or former employee or Member) 
shall be subject to legal process for the enforcement of the individ-
ual's legal obligations to provide child support or make alimony 
payments as provided in section 459 of the Social Security Act (42 
U.S.C. 659). 
"(f) The sums in the Thrift Savings Fund shall not be appropriated 
for any purpose other than the purposes specified in this section and 
may not be used for any other purpose. 
"(g) All sums contributed to the Thrift Savings Fund by an 
employee or Member or by an employing agency for the benefit of 
such employee or Member and all net earnings in such Fund 
attributable to investment of such sums are held in such Fund in 
trust for such employee or Member. 
"§ 8438. Investment of Thrift Savings Fund 
"(a) For the purposes of this section— 
"(1) the term 'Common Stock Index Investment Fund' means 
the Common Stock Index Investment Fund established under 
subsection Ob)(l)(C); 
"(2) the term 'equity capital' means common and preferred 
stock, surplus, undivided profits, contingency reserves, and 
other capital reserves; 
"(3) the term 'Fixed Income Investment Fund' means the 
Fixed Income Investment Fund established under subsection 
a))(l)(B); 
Children and 
youth. 
Alimony. 
Law 
enforcement 
and crime. 
5 use 8438. 
100 STAT. 552 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(4) the term 'Government Securities Investment Fund' 
means the Government Securities Investment Fund estabUshed 
under subsection (b)(1)(A); 
"(5) the term 'net worth' means capital, paid-in and contrib-
uted surplus, unassigned surplus, contingency reserves, group 
contingency reserves, and special reserves; 
"(6) the term 'plan' means an employee benefit plan, as 
defined in section 3(3) of the Employee Retirement Income 
Security Act of 1974 (29 U.S.C. 1002(3)); 
"(7) the term 'qualified professional asset manager' means— 
"(A) a bank, as defined in section 202(a)(2) of the 
Investment Advisers Act of 1940 (15 U.S.C. 80b-2(a)(2)) 
which— 
"(i) has the power to manage, acquire, or dispose of 
assets of a plan; and 
"(ii) has, as of the last day of its latest fiscal year 
ending before the date of a determination for the pur-
pose of this clause, equity capital in excess of 
$1,000,000; 
"(B) a savings and loan association, the accounts of which 
are insured by the Federal Savings and Loan Insurance 
Corporation, which— 
"(i) has applied for and been granted trust powers to 
manage, acquire, or dispose of assets of a plan by a 
State or Government authority having supervision over 
savings and loan associations; and 
"(ii) has, as of the last day of its latest fiscal year 
ending before the date of a determination for the pur-
pose of this clause, equity capital or net worth in excess 
of $1,000,000; 
"(C) an insurance company which— 
"(i) is qualified under the laws of more than one 
State to manage, acquire, or dispose of any assets of a 
plan; 
"(ii) has, as of the last day of its latest fiscal year 
ending before the date of a determination for the pur-
pose of this clause, net worth in excess of $1,000,000; 
and 
"(iii) is subject to supervision and examination by a 
State authority having supervision over insurance 
companies; or 
"(D) an investment adviser registered under section 203 
of the Investment Advisers Act of 1940 (15 U.S.C. 80b-3) if 
the investment adviser has, on the last day of its latest 
fiscal year ending before the date of a determination for the 
purpose of this subparagraph, total client assets under its 
management and control in excess of $50,000,000, and— 
"(i) the investment adviser has, on such day, share-
holder's or partner's equity in excess of $750,000; or 
"(ii) payment of all of the investment adviser's liabil-
ities, including any liabilities which may arise by 
reason of a breach or violation of a duty described in 
section 8477 of this title, is unconditionally guaranteed 
b y -
"(I) a person (as defined in section 8471(4) of this 
title) who directly or indirectly, through one or 
more intermediaries, controls, is controlled by, or 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 553 
is under common control with the investment ad-
viser and who has, on the last day of the person's 
latest fiscal year ending before the date of a deter-
mination for the purpose of this clause, share-
holder's or partner s equity in an amount which, 
when added to the amount of the shareholder's or 
partner's equity of the investment adviser on such 
dav, exceeds $750,000; 
(II) a qualified professional asset manager de-
scribed in subparagraph (A), (B), or (C); or 
"(III) a broker or dealer registered under section 
15 of the Securities Exchange Act of 1934 (15 U.S.C. 
78o) that has, on the last day of the broker's or 
15 use 78o. 
dealer's latest fiscal year ending before the date of 
a determination for the purpose of this clause, net 
worth in excess of $750,000; and 
"(8) the term 'shareholder's or partner's equity', as used in 
paragraph (7)(D) with respect to an investment adviser or a 
person (as defined in section 8471(4) of this title) who is affili-
ated with the investment adviser in a manner described in 
clause (ii)(I) of such paragraph (7)(D), means the equity shown in 
the most recent balance sheet prepared for such investment 
adviser or affiliated person, in accordance with generally 
accepted accounting principles, within 2 years before the date 
on which the investment adviser's status as a qualified profes-
sional asset manager is determined for the purposes of this 
section. 
"(b)(1) The Board shall establish— 
"(A) a Government Securities Investment Fund under which 
sums in the Thrift Savings Fund are invested in securities of the 
United States Government issued as provided in subsection (f); 
"(B) a Fixed Income Investment Fund under which sums in 
the Thrift Savings Fund are invested in— 
"(i) insurance contracts; 
"(ii) certificates of deposits; or 
"(iii) other instruments or obligations selected by quali-
fied professional asset managers, 
which return the amount invested and pay interest, at a speci-
fied rate or rates, on that amount during a specified period of 
time; and 
"(C) a Common Stock Index Investment Fund as provided in 
paragraph (2). 
"(2)(A) The Board shall select an index which is a commonly 
recognized index comprised of common stock the aggregate market 
value of which is a reasonably complete representation of the 
United States equity markets. 
"(B) The Common Stock Index Investment Fund shall be invested 
in a portfolio designed to replicate the performance of the index 
selected under subparagraph (A). The portfolio shall be designed 
such that, to the extent practicable, the percentage of the Common 
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 included in such index. 
"(c)(1) Subject to subsection (e), the Executive Director shall invest 
the sums available in the Thrift Savings Fund for investment as 
provided in elections made under subsection (d). 
100 STAT. 554 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(2) If an election has not been made with respect to any sums in 
the Thrift Savings Fund available for investment, the Executive 
Director shall invest such sums in the Government Securities 
Investment Fund. 
"(dXD At least twice each year, an employee or Member (or 
former employee or Member) may elect the investment funds re-
ferred to in subsection (b) into which the sums in the Thrift Savings 
Fund credited to such individual's account and not subject to subsec-
tion (e) are to be invested or reinvested. 
"(2) An election may be made under paragraph (1) only in accord-
ance with regulations prescribed by the Executive Director and 
within such period as the Executive Director shall provide in such 
regulations. 
"(eXlXA) During each year specified under column 1 of table I set 
out in subparagraph (D), the Executive Director shall invest, with 
respect to each employee, Member, former employee, and former 
Member not less than the percentage determined under subpara-
graph (B) of the amount described in subparagraph (C) in the 
Government Securities Investment Fund. 
"(B) For the purposes of subparagraph (A), the minimum percent-
age applicable to investments during a year specified under column 
1 of table I is the percentage which corresponds to such year under 
column 2 of table I. 
"(C) The amount to be invested as provided in subparagraph (A) in 
any year specified under column 1 of table I is the total amount 
contributed to the Thrift Savings Fund by an employee. Member, 
former employee, or former Member under section 8432(a) of this 
title and available for investment during such year. 
"(D) Table I is as follows: 
"TABLE I 
"Column 1 
Column 2 
Year: 
Minimum percentage: 
1987 
100 
1988 
80 
1989 
60 
1990 
40 
1991 
20. 
"(2XA) During each year specified under column 1 of table II set 
out in subparagraph (D), the Executive Director shall invest, with 
respect to each employee. Member, former employee, and former 
Member not less than the percentage determined under subpara-
graph (B) of the amount described in subparagraph (C) in the 
Government Securities Investment Fund. 
"(B) For the purposes of subparagraph (A), the minimum percent-
age applicable to investments during a year specified under column 
1 of table II is the percentage which corresponds to such year under 
column 2 of table II. 
"(C) The amount to be invested as provided in subparagraph (A) in 
any year specified under column 1 of table II is the total amount 
contributed to the Thrift Savings Fund for the benefit of an em-
ployee. Member, former employee, or former Member under section 
8432(c) of this title and available for investment during such year. 
"(D) Table II is as follows: 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 555 
"TABLE II 
"Column 1 
Column 2 
Year: 
Minimum percentage: 
1987-1992 
100 
1993 
80 
1994 
60 
1995 
40 
1996 
20. 
"(3)(A) Before 1992, the sums invested in the Government Securi-
ties Investment Fund as required by paragraph (1) and the earnings 
attributable to the investment of such sums may not be reinvested 
in any investment fund other than the Government Securities 
Investment Fund. 
"(B) Before 1997, the sums invested in the Government Securities 
Investment Fund as required by paragraph (2) and the earnings 
attributable to the investment of such sums may not be reinvested 
in any investment fund other than the Government Securities 
Investment Fund. 
"(fKD The Secretary of the Treasury is authorized to issue special 
interest-bearing obligations of the United States for purchase by the 
Thrift Savings Fund for the Government Securities Investment 
Fund. 
"(2)(A) Obligations issued for the purpose of this subsection shall 
have maturities fixed with due regard to the needs of such Fund as 
determined by the Executive Director, and shall bear interest at a 
rate equal to the average market yield (computed by the Secretary 
of the Treasury on the basis of market quotations as of the end of 
the calendar month next preceding the date of issue of such obliga-
tions) on all marketable interest-bearing obligations of the United 
States then forming a part of the public debt which are not due or 
callable earlier than 4 years after the end of such calendar month. 
"(B) Any average market yield computed under subparagraph (A) 
which is not a multiple of one-eighth of 1 percent, shall be rounded 
to the nearest multiple of one-eighth of 1 percent. 
"(g) The Board, other Government agencies, the Executive Direc-
tor, an employee, a Member, a former employee, and a former 
Member may not exercise voting rights associated with the owner-
ship of securities by the Thrift Savings Fund. 
"§ 8439. Accounting and information 
5 use 8439. 
"(aXD The Executive Director shall establish and maintain an 
account for each individual for whom contributions are made under 
section 8432(cXl) of this title or who makes contributions to the 
Thrift Savings Fund under section 8351 of this title. 
"(2) The balance in an individual's account at any time is the 
excess o
f
— 
"(A) the sum of— 
"(i) all contributions made to the Thrift Savings Fund by 
the individual under section 8432(a) or 8351 of this title; 
"(ii) all contributions made to such Fund for the benefit of 
the individual under section 8432(c) of this title; and 
"(iii) the total amount of the allocations made to and 
reductions made in the account pursuant to paragraph (3), 
over 
- ' 
"(B) the amounts paid out of the Thrift Savings Fund with 
respect to such individual under this subchapter. 
"(3) Pursuant to regulations prescribed by the Executive Director, 
the Executive Director shall allocate to each account an amount 
equal to a pro rata share of the net earnings and net losses from 
each investment of sums in the Thrift Savings Fund attributable to 
sums credited to such account, reduced by an appropriate share of 
100 STAT. 556 
PUBLIC LAW 99-335—JUNE 6, 1986 
Reports. 
Regulations. 
the administrative expenses paid out of the net earnings under 
section 8437(d) of this title, as determined by the Executive Director. 
"(b)(1) For the purposes of this subsection, the term 'qualified 
public accountant shall have the same meaning as provided in 
section 103(a)(3)(D) of the Employee Retirement Income Security Act 
of 1974 (29 U.S.C. 1023(a)(3)(D)). 
"(2) The Executive Director shall annually engage, on behalf of all 
individuals for whom an account is maintained, an independent 
qualified public accountant, who shall conduct an examination of all 
accounts and other books and records maintained in the administra-
tion of this subchapter and subchapter VII as the public accountant 
considers necessary to enable the public accountant to make the 
determination required by paragraph (3). The examination shall be 
conducted in accordance with generally accepted auditing standards 
and shall involve such tests of the accounts, books, and records as 
the public accountant considers necessary. 
"(3) The public accountant conducting an examination under 
paragraph (2) shall determine whether the accounts, books, and 
records referred to in such paragraph have been maintained in 
conformity with generally accepted accounting principles applied on 
a basis consistent with the manner in which such principles were 
applied during the examination conducted under such paragraph 
during the preceding year. The public accountant shall transmit to 
the Board and the Comptroller General of the United States a 
report on his examination, including his determination under this 
paragraph. 
"(4) In making a determination under paragraph (3), a public 
accountant may rely on the correctness of any actuarial matter 
certified by an enrolled actuary if the public accountant states his 
reliance in the report transmitted to the Board under such 
paragraph. 
"(c)(1) The Board shall prescribe regulations under which each 
individual for whom an account is maintained shall be furnished 
with— 
"(A) a periodic statement relating to the individual's account; 
and 
"(B) a summary description of the investment options under 
section 8438 of this title covering, and an evaluation of, each 
such option the 5-year period preceding the date as of which 
such evaluation is made. 
"(2) Information under this subsection shall be provided at least 
30 calendar days before the beginning of each election period under 
section 8432(b)(1)(A) of this title, and in a manner designed to 
facilitate informed decisionmaking with respect to elections under 
sections 8432 and 8438 of this title. 
"(d) Each employee. Member, former employee, or former Member 
who elects to invest in the Common Stock Index Investment Fund or 
the Fixed Income Investment Fund described in paragraphs (1) and 
(3), respectively, of section 8438(a) of this title shall sign an acknowl-
edgement prescribed by the Executive Director which states that the 
employee, Member, former employee, or former Member under-
stands that an investment in either such Fund is made at the 
employee's. Member's, former employee's, or former Member's risk, 
that the employee. Member, former employee, or former Member is 
not protected by the Government against any loss on such invest-
ment, and that a return on such investment is not guaranteed by 
the Government. 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 557 
"§ 8440. Tax treatment of the Thrift Savings Fund 
5 USC 8440 
"(a) For purposes of the Internal Revenue Code of 1954— 
26 use i et seq. 
"(1) the Thrift Savings Fund shall be treated as a trust 
described in section 401(a) of such Code which is exempt from 
26 USC 401. 
taxation under section 501(a) of such Code; 
26 use 501. 
"(2) any contribution to, or distribution from, the Thrift 
Savings Fund shall be treated in the same manner as contribu-
tions to or distributions from such a trust; and 
"(3) subject to the provisions of subsection O
t
>
) and any dollar 
limitation on the application of section 402(a)(8) of such Code, 
26 USC 402. 
contributions to the Thrift Savings Fund shall not be treated as 
distributed or made available to an employee or Member nor as 
a contribution made to the Fund by an employee or Member 
merely because the employee or Member has, under the provi-
sions of this subchapter and section 8351 of this title, an election 
whether the contribution will be made to the Thrift Savings 
Fund or received by the employee or Member in cash. 
"(b)(1) Subsection (a)(3) shall not apply to the Thrift Savings Fund 
unless the Fund meets the antidiscrimination requirements (other 
than any requirement relating to coverage) applicable to arrange-
ments described in section 401(k) of the Internal Revenue Code of 
1954 and to matching contributions. 
26 USC 401. 
"(2)(A) This subchapter shall not be treated as failing to meet the 
requirements of paragraph (1) for any year if the amount of the 
excess matching contributions and excess employee contributions 
for such year (and any income attributable to such contributions) is 
distributed before the close of the following year. Such contributions 
(and income) may be distributed without regard to any other provi-
sion of law. 
"(B) For purposes of subparagraph (A), the term 'excess matching 
contributions' means, with respect to any year, the excess o
f
— 
"(i) the aggregate amount of contributions under section 
8432(c) of this title actually made on behalf of highly com-
pensated employees (as defined for purposes of section 401(k) of 
the Internal Revenue Code of 1954) for such year, over 
"(ii) the maximum amount of such contributions permitted 
under the limitations of paragraph (1) (determined by reducing 
contributions made on behalf of highly compensated employees 
in order of the matching contribution percentages beginning 
with the highest of such percentages). 
"(C) For purposes of subparagraph (A), the amount of excess 
employee contributions shall be determined under the principles of 
subparagraph (B). 
"(D) Any distribution of the excess matching contributions or 
excess employee contributions for any year shall be made to highly 
compensated employees on the basis of the respective portions of 
such amounts attributable to each of such employees. 
"(E) No early distribution tax, if any, under the Internal Revenue 
Code of 1954 shall be imposed on any amount required to be 
26 USC i et seq. 
distributed under subparagraph (A). 
"(c) Subsection (a) shall not be construed to provide that any 
amount of the employee's or Member's basic pay which is contrib-
uted to the Thrift Savings Fund shall not be included in the term 
'wages' for the purposes of section 209 of the Social Security Act or Ante, p. 288. 
section 3121(a) of the Internal Revenue Code of 1954. 
26 USC 3i2i. 
100 STAT. 558 
PUBLIC LAW 99-335—JUNE 6, 1986 
"SUBCHAPTER IV—SURVIVOR ANNUITIES 
5 use 8441. 
"§ 8441. Definitions 
"For the purpose of this subchapter— 
"(1) the term 'widow' means the surviving wife of an em-
ployee, Member, or annuitant, or of a former employee or 
Member, who— 
"(A) was married to him for at least 9 months imme-
diately before his death; or 
"(B) is the mother of issue by that marriage; 
"(2) the term 'widower' means the surviving husband of an 
employee. Member, or annuitant, or of a former employee or 
Member, who— 
"(A) was married to her for at least 9 months imme-
diately before her death; or 
"(B) is the father of issue by that marriage; 
"(3) the term 'dependent', in the case of any child, means that 
the employee. Member, or annuitant involved was, at the time 
of death of the employee, Member, or annuitant either living 
with or contributing to the support of such child, as determined 
in accordance with such regulations as the Office shall pre-
scribe; and 
"(4) the term 'child' means— 
"(A) an unmarried dependent child under 18 years of age, 
including (i) an adopted child, (ii) a stepchild but only if the 
stepchild lived with the employee, Member, or annuitant in 
a regular parent-child relationship, (iii) a recognized natu-
ral child, and (iv) a child who lived with and for whom a 
petition of adoption was filed by an employee. Member, or 
annuitant and who is adopted by the widow or widower of 
the employee. Member, or annuitant after the death of such 
employee. Member, or annuitant; 
"(B) such unmarried dependent child regardless of age 
who is incapable of self-support because of mental or phys-
ical disability incurred before age 18; or 
"(C) such unmarried dependent child between 18 and 22 
years of age who is a student regularly pursuing a full-time 
course of study or training in residence in a high school, 
trade school, technical or vocational institute, junior col-
lege, college, university, or comparable recognized edu-
cational institution. 
For the purpose of this paragraph and section 8443, a child 
whose 22nd birthday occurs before July 1 or after August 31 of a 
calendar year, and while regularly pursuing such a course of 
study or training, is deemed to have become 22 years of age on 
the first day of July after that birthday. A child who is a 
student is deemed not to have ceased to be a student during an 
interim between school years if the interim is not more than 5 
months and if such child shows to the satisfaction of the Office 
that such child has a bona fide intention of continuing to pursue 
a course of study or training in the same or different school 
during the school semester (or other period into which the 
school year is divided) immediately after the interim. 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 559 
"§ 8442. Rights of a widow or widower 
5 use 8442. 
"(aXD Except as provided in subsection (g), if an annuitant dies 
and is survived by a widow or widower, the widow or widower is 
entitled to an annuity equal to 50 percent of an annuity computed 
under section 8415 with respect to the annuitant, unless— 
"(A) the right to an annuity was waived under section 8416(a) 
(and no election was subsequently made under section 8416(d) 
nullifying the waiver); or 
"(B) in the case of a marriage after retirement, the annuitant 
did not file an election under section 8416 (b) or (c), as the case 
may be. 
"(2) A spouse acquired after retirement is entitled to an annuity 
under this subsection (as provided in paragraph (1)) only upon 
electing this annuity instead of any other survivor benefit to which 
such spouse may be entitled under this subchapter or section 8424 or 
under another retirement system for Government employees. 
"(b)(1) If an employee or Member dies after completing at least 18 
months of civilian service creditable under section 8411 and is 
survived by a widow or widower, the widow or widower is entitled 
to— 
"(A) an amount equal to the sum of— 
"(i) 50 percent of the final annual rate of basic pay (or of 
the average pay, if higher) of the employee or Member; and 
"(ii) $15,000 as adjusted under section 8462(e); and 
"(B) if the employee or Member completed at least 10 years of 
service, an annuity equal to 50 percent of an annuity computed 
under section 8415 with respect to the employee or Member, but 
without regard to subsection (f) of such section. 
"(2) The Office shall prescribe regulations under which the total 
Regulations. 
amount payable to a widow or widower under paragraph (IXA) may, 
at the election of the widow or widower, be paid— 
"(A) in a lump sum; or 
"(B) on a monthly basis— 
"(i) over a period of 3 years beginning on the day after the 
employee's or Member's death; or 
"(ii) over any other period established under 
the 
regulations. 
Any method of payment provided for under subparagraph (B) shall 
be designed such that the present value of the benefits provided 
under such method is actuarially equivalent to the present value of 
a lump-sum payment under subparagraph (A). 
"(3) An amount payable under paragraph (IXA) shall not be 
considered to be part of an annuity for purposes of this chapter. 
"(cXD If a former employee or Member dies after having sepa-
rated from the service with title to a deferred annuity under section 
8413 but before having established a valid claim for an annuity, and 
is survived by a widow or widower to whom married on the date of 
separation, the widow or widower may elect to receive— 
"(A) an annuity under paragraph (2); or 
"(B) the lump-sum credit, if the widow or widower is the 
individual who would be entitled to the lump-sum credit and if 
such widow or widower files application therefor with the 
Office. 
"(2XAXi) Subject to clause (ii) and subparagraph (BXii), the annu-
ity of the widow or widower is equal to 50 percent of an annuity 
computed under section 8415 for the former employee or Member. 
100 STAT. 560 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(iiXD In computing an amount under section 8415 for a former 
employee or Member (described in subclause (ID) in order to com-
pute the annuity for a widow or widower under this subsection, the 
computation under section 8415 shall be made as if the former 
employee or Member had attained the applicable minimum retire-
ment age under section 8412(h). 
"(II) This clause applies with respect to a former employee or 
Member who dies before having attained the applicable minimum 
retirement age under section 8412(h). 
"(BXi) Notwithstanding the first sentence of subsection (d)(1), the 
annuity of the widow or widower of a former employee or Member 
under subparagraph (AXii) commences— 
"(I) on the day after the date on which the former employee or 
Member would have attained age 62; or 
"(II) if the widow or widower so designates in the election, as 
of the day after the death of the former employee or Member, 
"(ii) The present value of the annuity of a widow or widower who 
chooses the earlier commencement date under clause (iXII) shall be 
actuarially equivalent to the present value of an annuity computed 
for the widow or widower, determined as if the commencement date 
under clause (iXD were applicable. 
"(3XA) Paragraphs (1) and (2) shall apply only in the case of an 
employee or Member who completes at least 10 years of service. 
"(B) Nothing in this subsection shall be considered to affect the 
provisions of this chapter relating to a lump-sum credit in the case 
of the widow or widower of a former employee or Member who dies 
after completing less than 10 years of service. 
"(dXD The annuity of a widow or widower under this section 
commences on the day after the death of the individual on whose 
service such annuity is based. This annuity and the right thereto 
terminate on the last day of the month before the widow or 
widower— 
"(A) dies; or 
"(B) remarries before becoming 55 years of age. 
"(2) In the case of a widow or widower whose annuity under this 
section is terminated because of remarriage before becoming 55 
years of age, the annuity shall be restored at the same rate 
commencing on the day the remarriage is dissolved by death, di-
vorce, or annulment, i
f
— 
"(A) the widow or widower elects to receive this annuity 
instead of any other survivor benefit to which such widow or 
widower may be entitled (under this subchapter or section 8424 
or under another retirement system for Government employees) 
by reason of the remarriage; and 
"(B) any lump sum paid on termination of the annuity is 
returned to the Fund. 
"(e) The requirement in paragraphs (IXA) and (2XA) of section 
8441 that the widow or widower of an annuitant, employee, or 
Member, or of a former employee or Member, have been married to 
such individual for at least 9 months immediately before the death 
of the individual in order to qualify as the widow or widower of such 
individual shall be deemed satisfied in any case in which the 
individual dies within the applicable 9-month period, i
f
— 
"(1) the death of the individual was accidental; or 
"(2) the surviving spouse of the individual had been pre-
viously married to such individual and subsequently divorced, 
and the aggregate time married is at least 9 months. 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 561 
"(f)(1) Subject to paragraph (4), a survivor who is entitled to an 
annuity under subsection (a) shall also be entitled to a supple-
mentary annuity under this subsection. 
"(2) A supplementary annuity under this subsection shall be equal 
to the lesser o
f
— 
"(A) the amount by which the survivor's assumed CSRS 
annuity exceeds the annuity payable to such survivor under 
subsection (a); or 
"(B) the amount determined under paragraph (3). 
"(8)(A) Except as provided in subparagraph (B), the amount under 
this paragraph for a survivor is the amount of widow's or widower's 
insurance benefits which would be payable to such survivor under 
title II of the Social Security Act (without regard to sections 
42 USC 401. 
202(e)(7), 202(0(2), and 203 of such Act) based on the wages and self- 42 use 402, 403. 
employment income of the deceased annuitant, and determined— 
"(i) as of the date on which the annuitant died; and 
"(ii) as if the survivor had attained age 60 and made applica-
tion for those benefits under subsection (e) or (f) of section 202 of 
such Act, as the case may be. 
"(B) Any computation or determination under this paragraph 
shall be made in accordance with the applicable provisions of the 
Social Security Act, except that in computing any primary insur- 42 USC 1305. 
ance amount under section 215 of such Act for purposes of determin- 42 use 415. 
ing an amount under this subsection, subparagraphs (A) and (C) of 
section 842103)(2) shall apply. 
"(4) A supplementary annuity under this subsection— 
"(A) shall be payable to a survivor only for calendar months 
ending before the calendar month in which such survivor first 
satisfies 
the minimum 
age requirement 
under 
section 
202(e)(l)(B)(i) or 202(f)(l)(B)(i) of the Social Security Act, as the 42 use 402. 
case may be; 
"(B) shall not be payable to a survivor who would not be 
entitled to benefits under subsection (e) or (f) of section 202 of 
the Social Security Act based on the wages and self-employment 
income of the deceased annuitant (determined, as of the date of 
the annuitant's death, as if the survivor had attained age 60 and 
made appropriate application for benefits, but without regard to 
any restriction under either such subsection relating to re-
marriage); and 
"(C) shall not be payable to a survivor for any calendar month 
in which such survivor is entitled (or would, on proper applica-
tion, be entitled) to benefits under section 202(g) of the Social 
Security Act (relating to mother's and father's insurance bene-
fits), or under section 202 (e) or (f) of such Act by reason of 
having become disabled, based on the wages and self-
employment income of the deceased annuitant. 
"(5) For the purpose of this subsection, the term 'assumed CSRS 
annuity', as used in the case of a survivor, means the amount of the 
annuity to which such survivor would be entitled under subchapter 
III of chapter 83 of this title based on the service of the deceased 
Post, pp. 589, 
annuitant, determined— 
591-593. 
"(A) as of the day after the date of the annuitant's death; 
"(B) as if the survivor had made appropriate application 
therefor; and 
"(C) as if the service of the deceased annuitant were cred-
itable under such subchapter. 
100 STAT. 562 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(6) An amount payable under this subsection shall be adjusted 
under section 8462 and shall otherwise be treated under this chapter 
in the same way as an amount payable under subsection (a). 
"(g)(1) If the widow or widower of an annuitant under section 8452 
(hereinafter in this subsection referred to as a 'disability annuitant') 
is determined under subsection (a) to be entitled to an annuity based 
on the service of such disability annuitant, the annuity of the widow 
or widower shall be equal to 50 percent of the amount determined 
under paragraph (2), rather than of the amount referred to in 
subsection (a). 
"(2)(A) Except as provided in subparagraph (B), the amount on 
which the annuity of the widow or widower of a disability annuitant 
is based shall be the amount of the annuity to which such disability 
annuitant was entitled, as computed under section 8452 (including 
appropriate reduction under subsection (a)(2) of such section and 
any adjustments under section 8462 allowed under section 8452), as 
of the day before the date of the disability annuitant's death. 
"(B)(i) In the case of a widow or widower entitled to an annuity 
based on the service of a disability annuitant who dies before age 62, 
the amount under clause (ii) shall apply instead of the amount 
which would otherwise apply under subparagraph (A). 
"(ii)(I) Subject to subclause (II), the amount of the annuity to 
which the disability annuitant was entitled as of the day before the 
date of death shall be considered to be the amount which would be 
computed with respect to such disability annuitant under section 
8452(b) if the disability annuitant had attained age 62 on the day 
before date of death. 
"(II) For purposes of any such computation under section 
8452(b)(2) pursuant to this clause, creditable service shall (in addi-
tion to the service which would otherwise be used under subpara-
graph (B)(i) of such section) include the period of time between date 
of death and the date of the sixty-second anniversary of the birth of 
the annuitant, and average pay shall be adjusted in accordance with 
subparagraph (B)(ii) of such section only through date of death. 
"(h) The following rules shall apply notwithstanding any other 
provision of this section: 
"(1) The annuity payable under this section to a widow or 
widower may not exceed the difference between— 
"(A) the amount of the annuity which would otherwise be 
payable to such widow or widower under this section; and 
*(B) the amount of the annuity payable to any former 
spouse of the deceased employee. Member, or annuitant, or 
former employee or Member, based on an election made 
under section 8417(b) or a court order previously issued or 
agreement previously entered into £is described in section 
8445(a). 
"(2) The amount payable under subsection (b)(1)(A) to a widow 
or widower may not exceed the difference between— 
"(A) the amount which would otherwise be payable to 
such widow or widower under such subsection; and 
"(B) the portion of such amount payable to any former 
spouse of the deceased employee, Member, or annuitant, or 
former employee or Member, based on a court order pre-
viously issued or agreement previously entered into. 
"(3) A lump-sum credit under subsection (c)(2) shall be subject 
to the same terms and conditions as apply with respect to a 
lump-sum credit under section 8424(b). 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 563 
*'§ 8443. Rights of a child 
5 use 8443. 
"(aXD If an employee or Member dies after completing at least 18 
months of civilian service which is creditable under section 8411, or 
an annuitant dies, each surviving child is, for any month, entitled to 
an annuity equal to— 
"(A) the amount by which the applicable amount under para-
graph (2) for such month exceeds the applicable amount under 
paragraph (3) for such month, divided by 
"(B) the number of children entitled to a payment under this 
section for such month. 
"(2) The applicable amount under this paragraph for any month is 
the total amount to which the surviving child or children (as the 
case may be) of the annuitant, employee, or Member would be 
entitled for such month under subchapter III of chapter 83 based on Post, pp. 589, 
the service of such annuitant, employee, or Member, if the service of 591-593. 
such annuitant, employee, or Member were creditable under such 
subchapter. 
"(3) The applicable amount under this paragraph for any month is 
the total amount of child's insurance benefits which are payable (or 
would, on proper application, be payable) under title II of the Social 
Security Act for such month based on the wages and self-employ- 42 use 40i. 
ment income of such annuitant, employee, or Member. 
"(b) The annuity of a child under this subchapter— 
"(1) commences on the day after the annuitant, employee, or 
Member dies; 
"(2) commences or resumes on the first day of the month in 
which the child later becomes or again becomes a student as 
described by section 8441(4), if any lump sum paid is returned to 
the Fund; or 
"(3) commences or resumes on the first day of the month in 
which the child later becomes or again becomes incapable of 
self-support because of a mental or physical disability incurred 
before age 18 (or a later recurrence of such disability), if any 
lump sum paid is returned to the Fund. 
This annuity and the right thereto terminate on the last day of the 
month before the child— 
"(A) becomes 18 years of age unless then a student as de-
scribed or incapable of self-support; 
"(B) becomes capable of self-support after becoming 18 years 
of age unless then such a student; 
"(C) becomes 22 years of age if then such a student and 
capable of self-support; 
"(D) ceases to be such a student after becoming 18 years of age 
unless then incapable of self-support; or 
"(E) dies or marries; 
whichever occurs first. On the death of the surviving wife or hus-
band, or former wife or husband, or termination of the annuity of a 
child, the annuity of any other child or children shall be recomputed 
and paid as though the wife or husband, former wife or husband, or 
child had not survived the annuitant, employee, or Member. 
"§ 8444. Rights of a named individual with an insurable interest 5 USC 8444. 
"The annuity of a survivor named under section 8420(a) is 55 
percent of the reduced annuity of the retired employee or Member 
determined under paragraph (2) of such section 8420(a). The annuity 
of the survivor commences on the day after the retired employee or 
100 STAT. 564 
PUBLIC LAW 99-335—JUNE 6, 1986 
Member dies. This annuity and the right thereto terminate on the 
last day of the month before the survivor dies. 
5 use 8445. 
"§ 8445. Rights of a former spouse 
"(a) Subject to subsections (b) through (e), a former spouse of a 
deceased employee, Member, or annuitant (or of a former employee 
or Member who dies after having separated from the service with 
title to a deferred annuity under section 8413 but before having 
established a valid claim for annuity) is entitled to an annuity under 
this section, if and to the extent expressly provided for in an election 
under section 8417(b), or in the terms of any decree of divorce or 
annulment or any court order or court-approved property settle-
ment agreement incident to such decree. 
"(b)(1) The annuity payable to a former spouse under this section 
may not exceed the difference between— 
"(A) the amount applicable in the case of such former spouse, 
as determined under paragraph (2); and 
"(B) the amount of any annuity payable under this section to 
any other former spouse of the employee, Member, or annu-
itant, or former employee or Member, based on an election 
previously made under section 8417(b), or a court order pre-
viously issued or agreement previously entered into as described 
in subsection (a). 
"(2) The applicable amount, for purposes of paragraph (1)(A) in the 
case of a former spouse, is the amount of the annuity which would 
be payable under the provisions of section 8442 (including subsection 
(f) of such section, but without regard to subsection (h) of such 
section) if such former spouse were a widow or widower entitled to 
an annuity under such provisions based on the service of the 
deceased employee, Member, or annuitant, or former employee or 
Member. 
Contracts. 
"(c) The commencement and termination of an annuity payable 
under this section shall be governed by the terms of the applicable 
order, decree, agreement, or election, as the case may be, except that 
any such annuity— 
"(1) shall not commence before— 
"(A) the day after the employee. Member, or annuitant, 
or former employee or Member, dies; or 
"(B) the first day of the second month beginning after the 
date on which the Office receives written notice of the 
order, decree, agreement, or election, as the case may be, 
together with such additional information or documenta-
tion as the Office may prescribe; 
whichever is later; and 
"(2) shall terminate no later than the last day of the month 
before the former spouse remarries before becoming 55 years of 
age or dies. 
"(d) For purposes of this chapter, a modification in a decree, order, 
agreement, or election referred to in subsection (a) shall not be 
effective— 
"(1) if such modification is made after the retirement or death 
of the employee. Member, or annuitant, or former employee or 
Member, concerned; and 
"(2) to the extent that such modification involves an annuity 
under this section. 
"(e) For purposes of this chapter, a decree, order, agreement, or 
election referred to in subsection (a) shall not be effective, in the 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 565 
case of a former spouse, to the extent that it is inconsistent with any 
joint waiver previously executed with respect to such former spouse 
under section 8416(a). 
"(fKD Any amount under section 8442(bXlXA) which would other-
wise be payable to a widow or widower based on the service of 
another individual shall be paid (in whole or in part) by the Office to 
a former spouse of such individual if and to the extent expressly 
provided for in the terms of a court decree of divorce, annulment, or 
legal separation, or the terms of a court order or court-approved 
property settlement incident to any decree of divorce, annulment, or 
legal separation. 
"(2) Paragraph (1) shall apply only to payments made by the 
Office after the date of receipt in the Office of written notice of such 
decree, order, or agreement, and such additional information and 
documentation as the Office may prescribe. 
"(g) Any payment under this section to a person bars recovery by 
any other person. 
"SUBCHAPTER V—DISABILITY BENEFITS 
"§ 8451. Disability retirement 
5 use 8451. 
"(aXlXA) An employee who completes at least 18 months of 
civilian service creditable under section 8411 and has become dis-
abled shall be retired on the employee's own application or on 
application by the employee's agency. 
"(B) For purposes of this subsection, an employee shall be consid-
ered disabled only if the employee is found by the Office to be 
unable, because of disease or injury, to render useful and efficient 
service in the employee's position. 
"(2)(A) Notwithstanding paragraph (1), an employee shall not be 
eligible for disability retirement under this section if the employee 
has declined a reasonable offer of reassignment to a vacant position 
in the employee's agency for which the employee is qualified if the 
position— 
"(i) is at the same grade (or pay level) as the employee's most 
recent grade (or pay level) or higher; 
"(ii) is within the employee's commuting area; and 
"(iii) is one in which the employee would be able to render 
useful and efficient service. 
"(B) An employee who is applying for disability retirement under Regulations. 
« this subchapter shall be considered for reassignment by the em-
ployee's agency to a vacant position described in subparagraph (A) 
in accordance with such procedures as the Office shall by regulation 
prescribe. 
"(C) An employee is entitled to appeal to the Merit Systems 
Protection Board under section 7701 any determination that the 
employee is not unable, because of disease or injury, to render useful 
and efficient service in a position to which the employee has de-
clined reassignment under this section. 
"(D) For purposes of subparagraph (A), an employee of the United 
States Postal Service shall not be considered qualified for a position 
if such position is in a different craft or if reassignment to such 
position would be inconsistent with the terms of a collective-
bargaining agreement covering the employee. 
"(b) A Member who completes at least 18 months of service as a 
Member and is found by the Office to be disabled for useful and 
100 STAT. 566 
PUBLIC LAW 99-335—JUNE 6, 1986 
efficient service as a Member because of disease or injury shall be 
retired on the Member's own application. 
"(c) An employee or Member retiring under this section is entitled 
to an annuity computed under section 8452. 
5 use 8452. 
"§ 8452. Computation of disability annuity 
"(aXlXA) Except as provided in paragraph (2), or subsection (b), (c), 
or (d), the annuity of an annuitant under this subchapter— 
"(i) for the period beginning on the date on which such 
annuity commences, or is restored (as described in section 
8455(b) (2) or (3)), and ending at the end of the twelfth month 
beginning on or after such date, shall be equal to 60 percent of 
the annuitant's average pay; and 
"(ii) after the end of the period referred to in clause (i), shall 
be equal to 40 percent of the annuitant's average pay. 
"(B) An annuity computed under this paragraph shall not, for 
purposes of any adjustment under section 8462 (including any 
adjustment under subsection (c)(1) of such section), be considered to 
have commenced until after such annuity ceases to be determined 
under subparagraph (AXi). 
"(2XA) For any month in which an annuitant is entitled both to an 
annuity under this subchapter as computed under paragraph (1) and 
to a disability insurance benefit under section 223 of the Social 
42 use 423. 
Security Act, the annuitant's annuity for such month (as so com-
puted) shall— 
"(i) if such month occurs during a period referred to in 
paragraph (IXAXi), be reduced by 100 percent of the annuitant's 
assumed disability insurance benefit for such month; or 
"(ii) if such month occurs other than during a period referred 
to in paragraph (IXAXi), be reduced by 60 percent of the annu-
itant's assumed disability insurance benefit for such month; 
except that an annuity may not be reduced below zero by reason of 
this paragraph, 
"(BXi) For purposes of this paragraph, the assumed disability 
insurance benefit of an annuitant for any month shall be equal to— 
"(I) the amount of the disability insurance benefit to which 
the annuitant would have been entitled under section 223 of the 
Social Security Act for the month in which the annuity under 
this subchapter commenced, or was restored, determined as if 
such annuitant had then satisfied all requirements for entitle-
ment to a benefit under such section, adjusted by 
"(II) all adjustments made under section 8462(b) between the 
date on which the annuity commenced, or was restored, and the 
start of the month involved (without regard to whether the 
annuitant's annuity was affected by any of those ac^ustments). 
For purposes of computing the assumed disability insurance benefit, 
the month in which the annuitant's disability began (as determined 
42 use 416. 
under section 216(iX2XC) of the Social Security Act) shall be the 
month in which the annuity commenced or, if earlier (and if a 
determination was actually made) the month determined under 
such section. 
"(ii) For purposes of applying section 224 of the Social Security 
42 use 424a. 
Act to the assumed disability insurance benefit used to compute the 
reduction under this paragraph, the amount of the annuity under 
this subchapter which is considered shall be the amount of the 
annuity as determined before the application of this paragraph. 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 567 
"rt)Xl) Except as provided in subsection (d), if an annuitant is 
entitled to an annuity under this subchapter as of the day before the 
date of the sixty-second anniversary of the annuitant's birth (herein-
after in this section referred to as the annuitant's 'redetermination 
date'), such annuity shall be redetermined under paragraph (3) or 
(4), as applicable. Effective as of the annuitant's redetermination 
date, the annuity (as so redetermined) shall be in lieu of any annuity 
to which such annuitant would otherwise be entitled under this 
subchapter. 
"(2XA) In order to carry out paragraphs (3) and (4), the Office shall 
compute an annuity for the annuitant under section 8415. 
"(B) In performing a computation under this paragraph— 
"(i) creditable service of the annuitant shall be increased by 
including the period (or periods), if any, before the annuitant's 
redetermination date during which the annuitant was entitled 
to an annuity under this subchapter; and 
"(ii) the average pay which would otherwise be used shall be 
adjusted to reflect all adjustments made under section 8462(b) 
with respect to any period (or periods) referred to in clause (i) 
(without regard to whether the annuitant's annuity was 
affected by any of those adjustments). 
"(3) If, as of the day before the annuitant's redetermination date, 
the annuitant's annuity is subject to reduction under subsection 
(a)(2), the annuitant's redetermined annuity shall be the lesser of— 
"(A) the amount determined with respect to such annuitant 
under paragraph (2); or 
"(B) subject to the following sentence, the amount (converted 
so as to be expressed as an annual amount) which would 
otherwise be payable under this subchapter for the month in 
which occurs the day before the annuitant's redetermination 
date, as computed under subsection (a) (based on the assumption 
that the annuitant was entitled to an annuity under this sub-
chapter, and to a disability insurance benefit under section 223 
of the Social Security Act, for the entirety of such month). 42 use 423. 
If the annuitant's redetermination date occurs during the period 
described in subsection (a)(1)(A), the amount used under subpara-
graph (B) may not exceed the amount (converted so as to be ex-
pressed as an annual amount) which would otherwise be payable 
under this subchapter for the first month after such period, as 
computed under subsection (a) based on the assumption that the 
annuitant was entitled to an annuity under this subchapter, and to 
a disability insurance benefit under section 223 of the Social Secu-
rity Act, for the entirety of such month. 
"(4) If, as of the day before the annuitant's redetermination date, 
the annuitant's annuity is not subject to reduction under subsection 
(a)(2), the annuitant's redetermined annuity shall be the lesser of— 
"(A) the amount determined with respect to such annuitant 
under paragraph (2); or 
"(B) the amount which would be used for such annuitant 
under subparagraph (B) of paragraph (3) (as determined subject 
to the second sentence of such paragraph), if such paragraph 
applied to such annuitant. 
"(c) Except as provided in subsection (d), the annuity of an annu-
itant under this subchapter shall be computed under section 8415 
if— 
"(1) such annuity commences, or is restored, beginning on or 
after the redetermination date of the annuitant; or 
100 STAT. 568 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(2) as of the day on which such annuity commences, or is 
restored, the annuitant satisfies the age and service require-
ments for entitlement to an annuity under section 8412 (other 
than subsection (g) of such section). 
"(d) The annuity to which an annuitant is entitled under this 
section shall not be less than the amount of an annuity computed 
under section 8415 (excluding subsection (f) of such section). 
Claims. 
"§ 8453. Application 
"A claim may be allowed under this subchapter only if application 
is filed with the Office before the employee or Member is separated 
from the service or within 1 year thereafter. This time limitation 
may be waived by the Office for an employee or Member who, at the 
date of separation from service or within 1 year thereafter, is 
mentally incompetent if the application is filed with the Office 
within 1 year from the date of restoration of the employee or 
Member to competency or the appointment of a fiduciary, whichever 
is earlier. 
5 use 8454. 
"§ 8454. Medical examination 
"An annuitant receiving a disability retirement annuity from the 
Fund shall be examined under the direction of the Office— 
"(1) at the end of 1 year from the date of the disability 
retirement; and 
"(2) annually thereafter until becoming 60 years of age; 
unless the disability is permanent in character. If the annuitant 
fails to submit to examination as required by this section, payment 
of the annuity shall be suspended until continuance of the disability 
is satisfactorily established. 
5 use 8455. 
"§ 8455. Recovery; restoration of earning capacity 
"(a)(1) If an annuitant receiving a disability retirement annuity 
from the Fund recovers from the disability before becoming 60 years 
of age, payment of the annuity terminates on reemployment by the 
Government or 1 year after the date on which the Office determines 
that the annuitant has recovered, whichever is earlier. 
"(2) If an annuitant receiving a disability annuity from the Fund, 
before becoming 60 years of age, is restored to an earning capacity 
fairly comparable to the current rate of pay of the position occupied 
at the time of retirement, payment of the annuity terminates 180 
days after the end of the calendar year in which earning capacity is 
so restored. Earning capacity is deemed restored if in any calendar 
year the income of the annuitant from wages or self-employment or 
both equals at least 80 percent of the current rate of pay of the 
position occupied immediately before retirement. 
"(b)(1) If an annuitant whose annuity is terminated under subsec-
tion (a) is not reemployed in a position in which that individual is 
subject to this chapter, such individual is deemed, except for service 
credit, to have been involuntarily separated from the service for the 
purpose of subchapter II of this chapter as of the date of termination 
of the disability annuity, and after that termination is entitled to 
annuity under the applicable provisions of such subchapter. 
"(2) If an annuitant whose annuity is terminated under subsection 
(a)(2)-
"(A) is not reemployed in a position subject to this chapter; 
and 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 569 
"(B) has not recovered from the disability for which that 
individual was retired; 
the annuity of such individual shall be restored at the applicable 
rate under section 8452 effective the first of the year following any 
calendar year in which such individual's income from wages or self-
employment or both is less than 80 percent of the current rate of 
pay of the position occupied immediately before retirement. 
"(3) If an annuitant whose annuity is terminated because of a 
medical finding that the individual has recovered from disability is 
not reemployed in a position in which such individual is subject to 
this chapter, the annuity of such individual shall be restored at the 
applicable rate under section 8452 effective from the date on which 
the Office determines that there has been a recurrence of the 
disability. 
"(4) Paragraphs (2) and (3) shall not apply in the case of an 
annuitant receiving an annuity from the Fund under subchapter II 
of this chapter. 
"§ 8456. Relationship to workers' compensation 
5 USC 8456. 
"(a)(1) An individual is not entitled to receive an annuity under 
this subchapter and compensation for injury to or disability of the 
individual under subchapter I of chapter 81 covering the same 5 USC 8101. 
period of time. 
"(2) Paragraph (1) does not bar the right of a claimant to the 
greater benefit conferred by either subchapter referred to in such 
paragraph for any part of the period referred to in such paragraph. 
"(3) Paragraph (1) and the provisions of subchapter I of chapter 81 
do not deny an individual an annuity which the individual is 
entitled to receive under this chapter on account of service per-
formed by the individual and do not deny any concurrent benefit to 
the individual under subchapter I of chapter 81 on account of the 
death of another individual. 
"(bXD Subject to paragraph (2), an individual's receipt of a lump-
sum payment for compensation under section 8135 shall not affect 
the individual's entitlement to an annuity under this subchapter. 
"(2) If an annuity is payable under this subchapter by reason of 
the same disability for which a lump-sum payment of compensation 
referred to in paragraph (1) has been made, so much of the com-
pensation as has been paid for a period extended beyond the date 
payment of the annuity commences, as determined by the Depart-
ment of Labor, shall be refunded to that Department for credit to 
the Employees' Compensation Fund. Before the individual may 
receive the disability annuity, the individual shall— 
"(A) refund to the Department of Labor the amount rep-
resenting the commuted compensation payments for the 
extended period; or 
"(B) authorize the deduction of the amount from the annuity. 
Deductions from the annuity may be made from accrued or accruing 
payments. The amounts deducted and withheld from the annuity 
shall be transmitted to the Department of Labor for reimbursement 
to the Employees' Compensation Fund. When the Department of 
Labor finds that the financial circumstances of an individual enti-
tled to an annuity under this subchapter warrant deferred refund-
ing under this paragraph, deductions from the annuity may be 
prorated against and paid from accruing payments in such manner 
as the Department determines appropriate. 
100 STAT. 570 
PUBLIC LAW 99-335—JUNE 6, 1986 
5 use 8457. 
"§ 8457. Military reserve technicians 
"(a)(1) Except as provided in paragraph (2) or (3), an individual 
shall be retired under this subchapter if the individual— 
"(A) is separated from employment as a military reserve 
technician by reason of a disability that disqualifies the individ-
ual from membership in a reserve component of the Armed 
Forces specified in section 261(a) of title 10 or from holding the 
military grade required for such employment; 
"(B) is not considered 
to be disabled 
under 
section 
8451(a)(1)(B); 
"(C) is not appointed to a position in the Government 
(whether under subsection (c) or otherwise); and 
"(D) has not declined an offer of an appointment to a position 
in the Government under subsection (c). 
"(2) Payment of any annuity for an individual pursuant to this 
section terminates— 
"(A) on the date the individual is appointed to a position in 
the Government (whether pursuant to subsection (c) or other-
wise); 
"(B) on the date the individual declines an offer of appoint-
ment to a position in the Government under subsection (c); or 
"(C) as provided under section 8455(a). 
"(3) An individual eligible to retire under section 8414(c) shall not 
be eligible to retire under this section. 
"(b) Any individual applying for or receiving any annuity pursu-
ant to this section shall, in accordance with regulations prescribed 
by the Office, be considered by any agency of the Government before 
any vacant position in the agency is filled if— 
"(1) the position is located within the commuting area of the 
individual's former position; 
"(2) the individual is qualified to serve in such position, as 
determined by the head of the agency; and 
"(3) the position is at the same grade or equivalent level as 
the position from which the individual was separated. 
"SUBCHAPTER VI—GENERAL AND ADMINISTRATIVE 
PROVISIONS 
5 use 8461. 
"§ 8461. Authority of the Office of Personnel Management 
"(a) The Office shall pay all benefits that are payable under 
subchapter II, IV, V, or VI of this chapter from the Fund. 
"(b) The Office shall administer all provisions of this chapter not 
specifically required to be administered by the Board, the Executive 
Director, the Secretary of Labor, or any other officer or agency. 
"(c) The Office shall adjudicate all claims under the provisions of 
this chapter administered by the Office. 
"(d) The Office shall determine questions of disability and depend-
ency arising under the provisions of this chapter administered by 
the Office. Except to the extent provided under subsection (e), the 
decisions of the Office concerning these matters are final and 
conclusive and are not subject to review. The Office may direct at 
any time such medical or other examinations as it considers nec-
essary to determine the facts concerning disability or dependency of 
an individual receiving or applying for annuity under the provisions 
of this chapter administered by the Office. The Office may suspend 
or deny annuity for failure to submit to examination. 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 571 
"(e)(1) Subject to paragraph (2), an administrative action or order 
affecting the rights or interests of an individual or of the United 
States under the provisions of this chapter administered by the 
Office may be appealed to the Merit Systems Protection Board 
under procedures prescribed by the Board. 
"(2) In the case of any individual found by the Office to be disabled 
in whole or in part on the basis of the individual's mental condition, 
and that finding was made pursuant to an application by an agency 
for purposes of disability retirement under section 8451, the proce-
dures under section 7701 shall apply and the decision of the Board 
shall be subject to judicial review under section 7703. 
"(f) The Office shall fix the fees for examinations made under 
subchapter V of this chapter by physicians or surgeons who are not 
medical officers of the United States. The fees and reasonable 
traveling and other expenses incurred in connection with the 
examinations are paid from appropriations for the cost of admin-
istering the provisions of this chapter administered by the Office. 
"(g) The Office may prescribe regulations to carry out the provi-
sions of this chapter administered by the Office. 
"(hXD Each Government agency shall furnish the Director with 
such information as the Director determines necessary in order to 
administer this chapter. 
"(2) The Director, in consultation with the officials from whom Regulations. 
such information is requested, shall establish Ot)y regulation or 
otherwise) such safeguards as are necessary to ensure that informa-
tion made available under this subsection is used only for the 
purpose authorized. 
"(i) In making a determination of 'actuarial equivalence' under 
this chapter, the economic assumptions used shall be the same as 
the economic assumptions most recently used by the Office Ot)efore 
the determination of actuarial equivalence involved) in determining 
the normal-cost percentage of the System. 
"(j)(l) Notwithstanding any other provision of this chapter, the 
Director of Central Intelligence shall, in a manner consistent with 
the administration of this chapter by the Office, and to the extent 
considered appropriate by the Director of Central Intelligence— 
"(A) determine entitlement to benefits under this chapter 
based on the service of employees of the Central Intelligence 
Agency; 
"(B) maintain records relating to the service of such Records. 
employees; 
"(C) compute benefits under this chapter based on the service 
of such employees; 
"(D) collect deposits to the Fund made by such employees, 
their spouses, their former spouses, and their survivors; 
"(E) authorize and direct disbursements from the Fund to the 
extent based on service of such employees; and 
"(F) perform such other functions under this chapter (other 
than under subchapters III and VII of this chapter) with respect 
to employees of the Central Intelligence Agency as the Director 
of Central Intelligence, in consultation with the Director of the 
Office of Personnel Management, determines to be appropriate. 
"(2) The Director of the Office of Personnel Management shall 
furnish such information and, on a reimbursable basis, such services 
to the Director of Central Intelligence as the Director of Central 
Intelligence requests to carry out paragraph (1). 
100 STAT. 572 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(k)(l) The Director of Central Intelligence, in consultation with 
the Executive Director of the Federal Retirement Thrift Investment 
Board, may— 
"(A) maintain exclusive records relating to elections, con-
tributions, and accounts under the Thrift Savings Plan provided 
in subchapter III of this chapter in the case of employees of the 
Central Intelligence Agency; 
"(B) provide that contributions by, or on behalf of, such 
employees to the Thrift Savings Plan be accounted for by such 
Executive Director in aggregate amounts; 
"(C) make the necessary disbursements from, and the nec-
essary allocations of earnings, losses, and charges to, individual 
accounts of such employees under the Thrift Savings Plan; and 
"(D) perform such other functions under subchapters III and 
VII of this chapter (but not including investing sums in the 
Thrift Savings Fund) with respect to employees of the Central 
Intelligence Agency as the Director of Central Intelligence, in 
consultation with the Executive Director of the Federal Retire-
ment Thrift Investment Board, determines to be appropriate. 
"(2) The Executive Director of the Federal Retirement Thrift 
Investment Board may not exercise authority under this chapter in 
the case of employees of the Central Intelligence Agency to the 
extent that the Director of Central Intelligence exercises authority 
provided in paragraph (1). 
"(3) The Executive Director of the Federal Retirement Thrift 
Investment Board shall furnish such information and, on a re-
imbursable basis, such services to the Director of Central Intel-
ligence as the Director of Central Intelligence determines necessary 
to carry out this subsection. 
"(1) Subsection (h)(1), and sections 8439(b) and 8474(c)(4), shall be 
applied with respect to information relating to employees of the 
Central Intelligence Agency in a manner that protects intelligence 
sources, methods, and activities. 
Regulations. 
"(m)(l) The Director of Central Intelligence, in consultation with 
the Director of the Office of Personnel Management and the Execu-
tive Director of the Federal Retirement Thrift Investment Board, 
shall by regulation prescribe appropriate procedures to carry out 
subsections (j), (k), and (1). 
"(2) The regulations shall provide procedures for the Director of 
the Office of Personnel Management to inspect and audit disburse-
ments from the Fund, and from the Thrift Savings Fund, under this 
chapter. 
"(3) The Director of Central Intelligence shall submit the regula-
tions prescribed under paragraph (1) to the Select Committee on 
Intelligence of the Senate and the Permanent Select Committee on 
Intelligence of the House of Representatives before the regulations 
take effect. 
5 use 8462. 
"§ 8462. Cost-of-living adjustments 
"(a) For the purpose of this section— 
"(1) the term 'base quarter', as used with respect to a year, 
means the calendar quarter ending on September 30 of such 
year; 
"(2) the price index for a b£ise quarter is the arithmetical 
mean of such index for the 3 months comprising such quarter; 
and 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 573 
"(3) the term 'percent change in the price index', as used with 
respect to a year, means the percentage derived by— 
"(A) reducing— 
"(i) the price index for the base quarter of such year, 
by 
(ii) the price index for the base quarter of the 
preceding year in which an adjustment under this 
subsection was made; 
"(B) dividing the difference under subparagraph (A) by 
the price index referred to in subparagraph (A)(ii); and 
"(C) multiplying the quotient under subparagraph (B) by 
100. 
"0))(1) Except as provided in subsection (c), effective December 1 of 
any year in which an adjustment under this subsection is to be 
made, as determined under paragraph (2), each annuity payable 
from the Fund under this chapter (other than an annuity under 
section 8443) having a commencing date not later than such Decem-
ber 1 shall be adjusted as follows: 
"(A) If the percent change in the price index for the year does 
not exceed 3 percent, each annuity subject to adjustment under 
this subsection shall be increased by the lesser o
f
— 
"(i) the percent change in the price index (rounded to the 
nearest one-tenth of 1 percent); or 
"(ii) 2 percent. 
"(B) If the percent change in the price index for the year 
exceeds 3 percent, each annuity subject to adjustment under 
this subsection shall be increased by the excess of— 
"(i) the percent change in the price index (rounded to the 
nearest one-tenth of 1 percent), over 
"(ii) 1 percent. 
"(2) An adjustment under this subsection shall be made in a year 
only if the price index for the base quarter of such year exceeds the 
price index for the base quarter of the preceding year in which an 
adjustment under this subsection was made. 
'(3) An annuity under this chapter shall not be subject to adjust-
ment under section 8340. 
"(c) Eligibility for an annuity increase under this section is gov-
erned by the commencing date of each annuity payable from the 
Fund as of the effective date of an increase, except as follows: 
"(1) The first increase (if any) made under subsection (b) to an 
annuity which is payable from the Fund to an annuitant or 
survivor (other than a child under section 8443) whose annuity 
has not been increased under this subsection or subsection (b) 
shall be equal to the product (adjusted to the nearest one-tenth 
of 1 percent) of— 
"(A) one-twelfth of the applicable percent change com-
puted under subsection (b), multiplied by 
"(B) the number of months (not to exceed 12 months, 
counting any portion of a month as a month)— 
"(i) for which the annuity was payable from the Fund 
before the effective date of the increase; or 
"(ii) in the case of a survivor of a deceased annuitant 
whose annuity has not been so increased, since the 
annuity was first payable to the deceased annuitant. 
"(2) Effective from its commencing date, an annuity payable 
from the Fund to an annuitant's survivor (other than a widow 
or widower whose annuity is computed under section 8442(g) or 
100 STAT. 574 
PUBLIC LAW 99-335—JUNE 6, 1986 
a child under section 8443) shall be increased by the total 
percentage by which the deceased annuitant's annuity had been 
increased under this section during the period beginning on the 
date the deceased annuitant's annuity commenced and ending 
on the date of the deceased annuitant's death. 
"(3)(A) An adjustment under subsection (b) for any year shall 
not be effective with respect to the annuity of an annuitant who 
is under 62 years of age as of the date on which such adjustment 
would otherwise first take effect. 
"(B)(i) Except as provided in clause (ii), this paragraph applies 
only with respect to an annuitant under section 8412, 8413, or 
8414. 
"(ii) This paragraph does not apply with respect to an annu-
itant under subsection (d) or (e) of section 8412 or (in the case of 
an annuitant separated from service as a military reserve 
technician as a result of disability) under section 8414(c). 
"(4) The first increase (if any) made under subsection (b) to an 
annuity which is payable from the Fund to a widow or widower 
whose annuity is computed under section 8442(g) shall be equal 
to the product (adjusted to the nearest one-tenth of 1 percent) 
of— 
"(A) one-twelfth of the applicable percent change com-
puted under subsection (b), multiplied by 
"(B) the number of months (not to exceed 12 months, 
counting any portion of a month as a month) since— 
"(i) the effective date of the adjustment last made 
under this section in the annuity of the annuitant on 
whose service on the widow's or widower's annuity is 
based; or 
"(ii) if the annuity of the annuitant (referred to in 
clause (i)) has not been increased under this section, the 
commencement date of such annuitant's 
annuity 
(determined subject to section 8452(a)(1)(B)). 
"(d) The monthly installment of an annuity after adjustment 
under this section shall be rounded to the next lowest dollar. 
However, the monthly installment shall, after adjustment, reflect 
an increase of at least $1. 
"(e) The $15,000 amount referred to in section 8442(b)(l)(A)(ii) 
shall be increased at the same time that, and by the same percent as 
the percentage by which, annuities under subchapter III of chapter 
Post, pp. 589, 
83 are increased. 
591-593. 
5 use 8463. 
"§ 8463. Rate of benefits 
"Each annuity payable from the Fund is stated as an annual 
amount, one-twelfth of which, rounded to the next lower dollar, 
constitutes the monthly rate payable on the first business day of the 
first month beginning after the month for which it has accrued. 
5 use 8464. 
"§ 8464. Commencement and termination of annuities of employ-
ees and Members 
"(a)(1) Except as otherwise provided in this chapter— 
"(A) an annuity payable from the Fund commences on the 
first day of the month after— 
"(i) separation from the service, in the case of an em-
ployee or Member retiring under section 8412, or subsection 
(a) or (b)(1)(B) of section 8414; or 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 575 
"(ii) pay ceases, and the applicable age and service 
requirements are met, in the case of an employee or 
Member retiring under section 8413; 
"(B) an annuity payable from the Fund commences on the day 
after separation from the service in the case of an employee 
retiring under subsection (b)(1)(A) or (c) of section 8414; and 
"(C) an annuity payable from the Fund commences on the day 
after separation from the service or the day after pay ceases and 
the requirements for title to an annuity are met in the case of 
an employee or Member retiring under section 8451. 
"(2) Notwithstanding paragraph (lXA)(i), an annuity payable from 
the Fund commences on the day after separation from the service in 
the case of an employee or Member— 
"(A) who retires under section 8412; and 
"(B) whose separation occurs upon the expiration of a term (or 
other period) for which the individual was appointed or elected. 
"(b) Except as otherwise provided in this chapter, the annuity of 
an annuitant under subchapter II or V of this chapter terminates on 
the date death or other terminating event occurs. 
"§ 8465. Waiver, allotment, and assignment of benefits 
5 use 8465. 
"(a) An individual entitled to an annuity payable from the Fund 
may decline to accept all or any part of the amount of the annuity 
by a waiver signed and filed with the Office. The waiver may be 
revoked in writing at any time. Payment of the annuity waived may 
not be made for the period during which the waiver is in effect. 
"(b) An individual entitled to an annuity payable from the Fund 
may make allotments or assignments of amounts from the annuity 
for such purposes as the Office considers appropriate. 
"§ 8466. Application for benefits 
5 USC 8466 
"(a) No payment of benefits based on the service of an employee or 
Member shall be made from the Fund unless an application for 
payment of the benefits is received by the Office before the one 
hundred and fifteenth anniversary of the birth of the employee or 
Member. 
"(b) Notwithstanding subsection (a), after the death of an 
employee. Member, or annuitant, or former employee or Member, a 
benefit based on the service of such employee. Member, or annu-
itant, or former employee or Member, shall not be paid under 
subchapter II or IV of this chapter unless an application therefor is 
received by the Office within 30 years after the death or other event 
which establishes the entitlement to the benefit. 
"(c) Payment due a minor, or an individual mentally incompetent 
or under other legal disability, may be made to the person who is 
constituted guardian or other fiduciary by the law of the State of 
residence of the claimant or is otherwise legally vested with the care 
of the claimant or his estate. If a guardian or other fiduciary of the 
individual under legal disability has not been appointed under the 
law of the State of residence of the claimant, payment may be made 
to any person who, in the judgment of the Office, is responsible for 
the care of the claimant, and the payment bars recovery by any 
other person. 
"§ 8467. Court orders 
5 USC 8467. 
"(a) Payments under this chapter which would otherwise be made 
to an employee. Member, or annuitant (including an employee. 
Children and 
youth. 
Disabled 
persons. 
100 STAT. 576 
PUBLIC LAW 99-335—JUNE 6, 1986 
Member, or annuitant as defined under section 8331) beised on the 
service of that individual shall be paid (in whole or in part) by the 
Office or the Executive Director (as the case may be), to another 
person if and to the extent that 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, annulment, or legal separation 
expressly provide. Any payment under this subsection to a person 
bars recovery by any other person. 
"(b) Subsection (a) shall apply only to payments made by the 
Office or the Executive Director under this chapter after the date on 
which the Office or the Executive Director (as the case may be) 
receives written notice of such decree, order, or agreement, and such 
additional information and documentation as the Office or the 
Executive Director may require. 
5 use 8468. 
"§ 8468. Annuities and pay on reemployment 
"(a) If an annuitant becomes employed in an appointive or elective 
position in the Government, payment of any annuity under sub-
chapter II or V of this chapter to the annuitant terminates effective 
on the date of the employment. The annuitant's service on and after 
the date the annuitant becomes so employed is covered by this 
chapter unless such service is performed as a justice or judge of the 
United States (as defined by section 451 of title 28) or as an 
employee subject to another retirement system for Government 
employees. Upon termination of the employment, the rights of the 
annuitant under subchapter II or V of this chapter (as the case may 
be) shall be redetermined. If the annuitant dies while still so 
employed, a survivor annuity payable with respect to the deceased 
annuitant shall be redetermined as if the employment had other-
wise terminated on the date of death. 
"(b) The amount of an annuity resulting from a redetermination 
of rights under this chapter pursuant to subsection (a) shall not be 
less than the amount of the terminated annuity plus any increases 
which (but for the reemployment) would have been payable under 
section 8462 after the termination of the annuity and before the 
commencement of the redetermined annuity. 
"(c) The redetermined annuity commences on the first day of the 
month after termination of employment. 
5 use 8469. 
"§ 8469. Withholding of State income taxes 
eontracts. 
"(a) The Office shall, in accordance with this section, enter into an 
agreement with any State within 120 days of a request for agree-
ment from the proper State official. The agreement shall provide 
that the Office shall withhold State income tax in the case of the 
monthly annuity of any annuitant who voluntarily requests, in 
writing, such withholding. The amounts withheld during any cal-
endar quarter shall be held in the Fund and disbursed to the States 
during the month following that calendar quarter. 
"(b) An annuitant may have in effect at any time only one request 
for withholding under this section, and an annuitant may not have 
more than two such requests in effect during any one calendar year. 
"(c) Subject to subsection (b), an annuitant may change the State 
designated by that annuitant for purposes of having withholdings 
made, and may request that the withholdings be remitted in accord-
ance with such change. An annuitant also may revoke any request 
of that annuitant for withholding. Any change in the State des-
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 577 
ignated or revocation is effective on the first day of the month after 
the month in which the request or the revocation is processed by the 
Office, but in no event later than on the first day of the second 
month beginning after the day on which such request or revocation 
is received by the Office. 
"(d) This section does not give the consent of the United States to 
the application of a statute which imposes more burdensome 
requirements on the United States than on employers generally, or 
which subjects the United States or any annuitant to a penalty or 
liability because of this section. The Office may not accept pay from 
a State for services performed in withholding State income taxes 
from annuities. Any amount erroneously withheld from an annuity 
and paid to a State by the Office shall be repaid by the State in 
accordance with regulations issued by the Office. 
"(e) For the purpose of this section— 
"(1) the term 'State' means a State, the District of Columbia, 
or any territory or possession of the United States; and 
"(2) the term 'annuitant' includes a survivor who is receiving 
an annuity from the Fund. 
"§ 8470. Exemption from legal process; recovery of payments 
5 use 8470. 
"(a) An amount payable under subchapter II, IV, or V of this 
chapter is not assignable, either in law or equity, except under the 
provisions of section 8465 or 8467, or subject to execution, levy, 
attachment, garnishment or other legal process, except as otherwise 
may be provided by Federal laws. 
"(b) Recovery of payments under subchapter II, IV, or V of this 
chapter may not be made from an individual when, in the judgment 
of the Office, the individual is without fault and recovery would be 
against equity and good conscience. Withholding or recovery of 
money paid under subchapter II, IV, or V of this chapter on account 
of a certification or payment made by a former employee of the 
United States in the discharge of his official duties may be made 
only if the head of the agency on behalf of which the certification or 
payment was made certifies to the Office that the certification or 
payment involved fraud on the part of the former employee. 
"SUBCHAPTER VII—FEDERAL RETIREMENT THRIFT 
INVESTMENT MANAGEMENT SYSTEM 
"§ 8471. Definitions 
5 USC 8471. 
"For the purposes of this subchapter— 
"(1) the term 'beneficiary' means an individual (other than a 
participant) entitled to payment from the Thrift Savings Fund 
under subchapter III of this chapter; 
"(2) the term 'Council' means the Employee Thrift Advisory 
Council established under section 8473 of this title; 
"(3) the term 'participant' means an individual for whom an 
account has been established under section 8439 of this title; 
"(4) the term 'person' means an individual, partnership, joint 
venture, corporation, mutual company, joint-stock company, 
trust, estate, unincorporated organization, association, or labor 
organization; and 
"(5) the term 'Thrift Savings Fund' means the Thrift Savings 
Fund established under section 8437 of this title. 
71-194 0 - 8 9 - 2 1 
: (X 3 Parti 
100 STAT. 578 
PUBLIC LAW 99-335—JUNE 6, 1986 
5 use 8472. 
"§ 8472. Federal Retirement Thrift Investment Board 
"(a) There is established in the Executive branch of the Govern-
ment a Federal Retirement Thrift Investment Board. 
"(b) The Board shall be composed of— 
"(1) 3 members appointed by the President, of whom 1 shall 
be designated by the President as Chairman; and 
"(2) 2 members appointed by the President, of whom— 
"(A) 1 shall be appointed by the President after taking 
into consideration the recommendation made by the 
Speaker of the House of Representatives in consultation 
with the minority leader of the House of Representatives; 
and 
"(B) 1 shall be appointed by the President after taking 
into consideration the recommendation made by the major-
ity leader of the Senate in consultation with the minority 
leader of the Senate. 
"(c) Except as provided in section 311 of the Federal Employees' 
Retirement System Act of 1986, appointments under subsection (a) 
shall be made by and with the advice and consent of the Senate. 
"(d) Members of the Board shall have substantial experience, 
training, and expertise in the management of financial investments 
and pension benefit plans. 
"(e)(1) Except as provided in section 311 of the Federal Employees' 
Retirement System Act of 1986, a member of the Board shall be 
appointed for a term of 4 years, except that of the members first 
appointed (other than the members appointed under such section)— 
"(A) the Chairman shall be appointed for a term of 4 years; 
"(B) the members appointed under subsection (b)(2) shall be 
appointed for terms of 3 years; and 
"(C) the remaining members shall be appointed for terms of 2 
years. 
"(2XA) A vacancy on the Board shall be filled in the manner in 
which the original appointment was made and shall be subject to 
any conditions which applied with respect to the 
original 
appointment, 
"(B) An individual chosen to fill a vacancy shall be appointed for 
the unexpired term of the member replaced. 
"(3) The term of any member shall not expire before the date on 
which the member's successor takes office. 
"(f) The Board shall— 
"(1) establish policies for— 
"(A) the investment and management of the Thrift Sav-
ings Fund; and 
"(B) the administration of subchapter III of this chapter; 
"(2) review the performance of investments made for the 
Thrift Savings Fund; and 
"(3) review and approve the budget of the Board. 
"(gXD The Board may— 
"(A) adopt, alter, and use a seal; 
"(B) except as provided in paragraph (2), direct the Executive 
Director to take such action as the Board considers appropriate 
to carry out the provisions of this subchapter and subchapter III 
of this chapter and the policies of the Board; 
"(C) upon the concurring votes of four members, remove the 
Executive Director from office for good cause shown; and 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 579 
"(D) take such other actions as may be necessary to carry out 
the functions of the Board. 
"(2) Except in the case of investments required by section 8438 of 
this title to be invested in securities of the Government, the Board 
may not direct the Executive Director to invest or to cause to be 
invested any sums in the Thrift Savings Fund in a specific asset or 
to dispose of or cause to be disposed of any specific asset of such 
Fund. 
"(h) The members of the Board shall discharge their responsibil-
ities solely in the interest of participants and beneficiaries under 
this subchapter and subchapter III of this chapter. 
"§ 8473. Employee Thrift Advisory Council 
5 USC 8473 
"(a) The Board shall establish an Employee Thrift Advisory Coun-
cil. The Council shall be composed of 14 members appointed by the 
Chairman of the Board in accordance with subsection (b). 
"(b) The Chairman shall appoint 14 members of the Council, of 
whom— 
"(1) 4 shall be appointed to represent the respective labor 
organizations representing (as exclusive representatives) the 
first, second, third, and fourth largest numbers of individuals 
subject to chapter 71 of this title; 
5 USC 7101 et 
"(2) 2 shall be appointed to represent the respective labor seq. 
organizations which have been accorded exclusive recognition 
under section 1203(a) of title 39 representing the largest and 
second largest numbers of individuals employed by the United 
States Postal Service; 
"(3) 1 shall be appointed to represent the labor organization 
which has been accorded exclusive recognition under section 
1203(a) of title 39 representing the largest number of individuals 
employed by the United States Postal Service £is rural letter 
carriers; 
"(4) 2 shall be appointed to represent the respective manage-
rial organizations (other than an organization described in para-
graph (5)) which consult with the United States Postal Service 
under section 1004(b) of title 39 and which represent the largest 
and second largest numbers of individuals employed by the 
United States Postal Service as managerial personnel; 
"(5) 1 shall be appointed to represent the supervisors' 
organization as defined in section 1004(h) of title 39; 
"(6) 1 shall be appointed to represent employee organizations 
having as a purpose promoting the interests of women in 
Government service; 
"(7) 1 shall be appointed to represent the organization rep-
resenting the largest number of individuals receiving annuities 
under this chapter or chapter 83 of this title; 
5 USC 8301 et 
"(8) 1 shall be appointed to represent the organization rep- seq. 
resenting the largest number of individuals subject to the 
Performance Management and Recognition System under chap-
ter 54 of this title; and 
5 USC 5401 et 
"(9) 1 shall be appointed to represent the organization rep- rep-
resenting the largest number of members of the Senior Execu-
tive Service. 
"(c)(1) The Chairman of the Board shall designate 1 member of the 
Council to serve as head of the Council. 
"(2) A member of the Council shall be appointed for a term of 4 
years. 
100 STAT. 580 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(3)(A) A vacancy in the Council shall be filled in the manner in 
which the original appointment was made and shall be subject to 
any conditions which applied with respect to the 
original 
appointment 
"(B) An individual chosen to fill a vacancy shall be appointed for 
the unexpired term of the member replaced. 
"(C) The term of any member shall not expire before the date on 
which the member's successor takes office. 
"(d) The Council shall act by resolution of a majority of the 
members. 
"(e) The Council shall— 
"(1) advise the Board and the Executive Director on matters 
relating to— 
"(A) investment policies for the Thrift Savings Fund; and 
"(B) the administration of this subchapter and sub-
chapter III of this chapter; and 
"(2) perform such other duties as the Board may direct with 
respect to investment funds established in accordance with 
subchapter III of this chapter. 
5 use app. 
"(f) Section 14(a)(2) of the Federal Advisory Committee Act shall 
not apply to the Council. 
5 use 8474 
"§ 8474. Executive Director 
"(a)(1) The Board shall appoint, without regard to the provisions of 
law governing appointments in the competitive service, an Execu-
tive Director by action agreed to by a majority of the members of the 
Board. 
"(2) The Executive Director shall have substantial experience, 
training, and expertise in the management of financial investments 
and pension benefit plans. 
"(b) The Executive Director shall— 
"(1) carry out the policies established by the Board; 
"(2) invest and manage the Thrift Savings Fund in accordance 
with the investment policies and other policies established by 
the Board; 
eontracts. 
"(3) purchase annuity contracts and provide for the payment 
of other benefits under subchapter III of this chapter; 
"(4) administer the provisions of this subchapter and sub-
chapter III of this chapter; 
Regulations. 
"(5) prescribe such regulations (other than regulations relat-
ing to fiduciary responsibilities) as may be necessary for the 
administration of this subchapter and subchapter III of this 
chapter; and 
"(6) meet from time to time with the Council upon request of 
the Council. 
"(c) The Executive Director may— 
"(1) prescribe such regulations as may be necessary to carry 
out the responsibilities of the Executive Director under this 
section, 
other 
than 
regulations 
relating 
to 
fiduciary 
responsibilities; 
"(2) appoint such personnel as may be necessary to carry out 
the provisions of this subchapter and subchapter III of this 
chapter; 
"(3) subject to approval by the Board, procure the services of 
5 use 3109. 
experts and consultants under section 3109 of this title; 
"(4) secure directly from an Executive agency, the United 
States Postal Service, or the Postal Rate Commission any 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 581 
information necessary to carry out the provisions of this sub-
chapter or subchapter III of this chapter and policies of the 
Board; 
"(5) make such payments out of sums in the Thrift Savings 
Fund as the Executive Director determines are necessary to 
carry out the provisions of this subchapter and subchapter III of 
this chapter and the policies of the Board; 
"(6) pay the compensation, per diem, and travel expenses of 
individuals appointed under paragraphs (2), (3), and (7) of this 
subsection from the Thrift Savings Fund; 
"(7) accept and use the services of individuals employed inter-
mittently in the Government service and reimburse such 
individuals for travel expenses, as authorized by section 5703 of 
this title, including per diem as authorized by section 5702 of 
5 use 5703. 
this title; 
5 use 5702. 
"(8) except as otherwise expressly prohibited by law or the 
policies of the Board, delegate any of the Executive Director's 
functions to such employees under the Board as the Executive 
Director 
may 
designate 
and 
authorize 
such 
successive 
redelegations of such functions to such employees under the 
Board as the Executive Director may consider to be necessary or 
appropriate; and 
"(9) take such other actions as are appropriate to carry out 
the functions of the Executive Director. 
"§ 8475. Investment policies 
5 use 8475. 
"The Board shall develop investment policies under section 
8472(f)(1) of this title which provide for— 
"(1) prudent investments suitable for accumulating funds for 
payment of retirement income; and 
"(2) low administrative costs. 
"§ 8476. Administrative provisions 
5 use 8476. 
"(a) The Board shall meet— 
"(1) not less than once during each month; and 
"(2) at additional times at the call of the Chairman. 
"(b)(1) Except as provided in sections 8472(g)(1)(C) and 8474(a)(1) of 
this title, the Board shall perform the functions and exercise the 
powers of the Board on a majority vote of a quorum of the Board. 
"(2) A vacancy on the Board shall not impair the authority of a 
quorum of the Board to perform the functions and exercise the 
powers of the Board. 
"(c) Three members of the Board shall constitute a quorum for the 
transaction of business. 
"(d)(1) Each member of the Board who is not an officer or em-
ployee of the Federal Government shall be compensated at the daily 
rate of basic pay for grade GS-18 of the General Schedule for each 
5 use 5332. 
day during which such member is engaged in performing a function 
of the Board. 
"(2) A member of the Board shall be paid travel, per diem, and 
other necessary expenses under subchapter I of chapter 57 of this 
title while traveling away from such member's home or regular 
5 use 5701. 
place of business in the performance of the duties of the Board. 
"(3) Payments authorized under this subsection shall be paid from 
the Thrift Savings Fund. 
100 STAT. 582 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(e) The accrued annual leave of any employee who is a member 
of the Board or the Council shall not be charged for any time used in 
performing services for the Board or the Council. 
5 use 8477. 
"§ 8477. Fiduciary responsibilities; liability and penalties 
"(a) For the purposes of this section— 
"(1) the term 'account' is not limited by the definition pro-
vided in section 8401(1); 
"(2) the term 'adequate consideration' means— 
"(A) in the case of a security for which there is a gen-
erally recognized market— 
"(i) the price of the security prevailing on a national 
securities exchange which is registered under section 6 
15 use 78f. 
of the Securities Exchange Act of 1934; or 
"(ii) if the security is not traded on such a national 
securities exchange, a price not less favorable to the 
Thrift Savings Fund than the offering price for the 
security as established by the current bid and asked 
prices quoted by persons independent of the issuer and 
of any party in interest; and 
"(B) in the case of an asset other than a security for 
which there is a generally recognized market, the fair 
market value of the asset as determined in good faith by a 
fiduciary or fiduciaries in accordance with regulations pre-
scribed by the Secretary of Labor; 
"(3) the term 'fiduciary' means— 
"(A) a member of the Board; 
"(B) the Executive Director; 
"(C) any person who has or exercises discretionary 
authority or discretionary control over the management or 
disposition of the assets of the Thrift Savings Fund; and 
' (D) any person who, with respect to the Thrift Savings 
Fund, is described in section 3(21)(A) of the Employee 
Retirement Income Security Act of 1974 (29 U.S.C 
1002(21)(A)); and 
"(4) the term 'party in interest' includes— 
"(A) any fiduciary; 
"(B) any counsel to a person who is a fiduciary, with 
respect to the actions of such person as a fiduciary; 
'(C) any participant; 
"(D) any person providing services to the Board and, with 
respect to the actions of the Executive Director as a 
fiduciary any person providing services to the Executive 
Director; 
"(E) a labor organization, the members of which are 
participants; 
"(F) a spouse, sibling, ancestor, lineal descendant, or 
spouse of a lineal descendant of a person described in 
subparagraph (A), (B), or (D); 
"(G) a corporation, partnership, or trust or estate of 
which, or in which, at least 50 percent of— 
"(i) the combined voting power of all classes of stock 
entitled to vote or the total value of shares of all classes 
of stock of such corporation; 
"(ii) the capital interest or profits interest of such 
partnership; or 
"(iii) the beneficial interest of such trust or estate. 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 583 
is owned directly or indirectly, or held by a person 
described in subparagraph (A), (B), (D), or (E); 
"(H) an official (including a director) of, or an individual 
employed by, a person described in subparagraph (A), (B), 
(D), (E), or (G), or an individual having powers or respon-
sibilities similar to those of such an official; 
"(I) a holder (directly or indirectly) of at least 10 percent 
of the shares in a person described in any subparagraph 
referred to in subparagraph (H); and 
"(J) a person who, directly or indirectly, is at least a 10 
percent partner or joint venturer (measured in capital or 
profits) in a person described in any subparagraph referred 
to in subparagraph (H). 
"Ot)Xl) To the extent not inconsistent with the provisions of this 
chapter and the policies prescribed by the Board, a fiduciary shall 
discharge his responsibilities with respect to the Thrift Savings 
Fund or applicable portion thereof solely in the interest of the 
participants and beneficiaries and— 
(A) for the exclusive purpose of^ 
"(i) providing benefits to participants and their bene-
ficiaries; and 
"(ii) defraying reasonable expenses of administering the 
Thrift Savings Fund or applicable portions thereof; 
"(B) with the care, skill, prudence, and diligence under the 
circumstances then prevailing that a prudent individual acting 
in a like capacity and familiar with such matters would use in 
the conduct of an enterprise of a like character and with like 
objectives; and 
"(C) to the extent permitted by section 8438 of this title, by 
diversifying the investments of the Thrift Savings Fund or 
applicable portions thereof so as to minimize the risk of large 
losses, unless under the circumstances it is clearly prudent not 
to do so. 
"(2) No fiduciary may maintain the indicia of ownership of any 
assets of the Thrift Savings Fund outside the jurisdiction of the 
district courts of the United States. 
"(c)(1) A fiduciary shall not permit the Thrift Savings Fund to 
engage in any of the following transactions, except in exchange for 
adequate consideration: 
"(A) A transfer of any assets of the Thrift Savings Fund to 
any person the fiduciary knows or should know to be a party in 
interest or the use of such assets by any such person. 
"(B) An acquisition of any property from or sale of any 
property to the Thrift Savings Fund by any person the fiduciary 
knows or should know to be a party in interest. 
"(C) A transfer or exchange of services between the Thrift 
Savings Fund and any person the fiduciary knows or should 
know to be a party in interest. 
"(2) Notwithstanding paragraph (1), a fiduciary with respect to the 
Thrift Savings Fund shall not— 
"(A) deal with any assets of the Thrift Savings Fund in his 
own interest or for his own account; 
"(B) act, in an individual capacity or any other capacity, in 
any transaction involving the Thrift Savings Fund on behalf of 
a party, or representing a party, whose interests are adverse to 
the interests of the Thrift Savings Fund or the interests of its 
participants or beneficiaries; or 
100 STAT. 584 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(C) receive any consideration for his own personal account 
from any party dealing with sums credited to the Thrift Savings 
Fund in connection with a transaction involving Eissets of the 
Thrift Savings Fund. 
"(3)(A) The Secretary of Labor may, in accordance with proce-
dures which the Secretary shall by regulation prescribe, grant a 
conditional or unconditional exemption of any fiduciary or trans-
action, or class of fiduciaries or transactions, from all or part of the 
restrictions imposed by paragraph (2). 
"(B) An exemption granted under this paragraph shall not relieve 
a fiduciary from any other applicable provision of this chapter. 
"(C) The Secretary of Labor may not grant an exemption under 
this paragraph unless he finds that such exemption is— 
"(i) administratively feasible; 
"(ii) in the interests of the Thrift Savings Fund and of its 
participants and beneficiaries; and 
"(iii) protective of the rights of participants and beneficiaries 
of such Fund. 
"(D) An exemption under this paragraph may not be granted 
unless— 
"(i) notice of the proposed exemption is published in the 
Federal Register; 
"(ii) interested persons are given an opportunity to present 
views; and 
"(iii) the Secretary of Labor affords an opportunity for a 
hearing and makes a determination on the record with respect 
to the respective requirements of clauses (i), (ii), and (iii) of 
subparagraph (C). 
"(d) This section does not prohibit any fiduciary from— 
"(1) receiving any benefit which the fiduciary is entitled to 
receive under this subchapter or subchapter III of this chapter 
as a participant or beneficiary; 
"(2) receiving any reasonable compensation authorized by this 
subchapter for services rendered, or for reimbursement of 
expenses properly and actually incurred, in the performance of 
the fiduciary s duties under this chapter; or 
"(3) serving as a fiduciary in addition to being an officer, 
employee, agent, or other representative of a party in interest. 
"(e)(1)(A) Any fiduciary that breaches the responsibilities, duties, 
and obligations set out in subsection (b) or violates subsection (c) 
shall be personally liable to the Thrift Savings Fund for any losses 
to such Fund resulting from each such breach or violation and to 
restore to such Fund any profits made by the fiduciary through use 
of assets of such Fund by the fiduciary, and shall be subject to such 
other equitable or remedial relief as a court considers appropriate. A 
fiduciary may be removed for a breach referred to in the preceding 
sentence. 
Law enforce- 
"(B) The Secretary of Labor may assess a civil penalty against a 
ment and 
party in interest with respect to each transaction which is engaged 
^^^^^- 
in by the party in interest and is prohibited by subsection (c). The 
amount of such penalty shall be equal to 5 percent of the amount 
involved in each such transaction (as defined in section 4975(fX4) of 
26 use 4975. 
the Internal Revenue Code of 1954) for each year or part thereof 
during which the prohibited transaction continues, except that, if 
the transaction is not corrected (in such manner as the Secretary of 
Labor shall prescribe by regulation consistent with section 4975(fX5) 
of such Code) within 90 days after the date the Secretary of Labor 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 585 
transmits notice to the party in interest (or such longer period as the 
Secretary of Labor may permit), such penalty may be in an amount 
not more than 100 percent of the amount involved. 
"(C) A fiduciary shall not be liable under subparagraph (A) with 
respect to a breach of fiduciary duty under subsection Ot)) committed 
before becoming a fiduciary or after ceasing to be a fiduciary. 
"(D) A fiduciary shall be jointly and severally liable under 
subparagraph (A) for a breach of fiduciary duty under subsection 0)) 
by another fiduciary if— 
"(i) the fiduciary participates knowingly in, or knowingly 
undertakes to conceal, an act or omission of such other fidu-
ciary, knowing such act or omission is such a breach; 
"(ii) by the fiduciary's failure to comply with subsection (b) in 
the administration of the fiduciary's specific responsibilities 
which give rise to the fiduciary status, the fiduciary has enabled 
such other fiduciary to commit such a breach; or 
"(iii) the fiduciary has knowledge of a breach by such other 
fiduciary, unless the fiduciary makes reasonable efforts under 
the circumstances to remedy the breach. 
"(E) The Secretary of Labor shall prescribe, in regulations, proce- Regulations. 
dures for allocating fiduciary responsibilities among fiduciaries, 
including investment managers. Any fiduciary who, pursuant to 
such procedures, allocates to a person or persons any fiduciary 
responsibility shall not be liable for an act or omission of such 
person or persons unless— 
"(i) such fiduciary violated subsection O
t
>
) with respect to the 
allocation, with respect to the implementation of the procedures 
prescribed by the Board, or in continuing such allocation; or 
"(ii) such fiduciary would otherwise be liable in accordance 
with subparagraph (D). 
"(2) A civil action may be brought in the district courts of the 
Courts, U.S. 
United States— 
"(A) by the Secretary of Labor— 
"(i) to determine and enforce a liability under paragraph 
(1)(A); 
"(ii) to collect any civil penalty under paragraph (1)(B); or 
"(iii) to enjoin any act or practice which violates subsec-
tion (g)(2) or (h) of section 8472 of this title; 
"(B) by the Secretary of Labor, any participant, beneficiary, 
or fiduciary— 
"(i) to enjoin any act or practice which violates any 
provision of subsection (b) or (c); or 
"(ii) to obtain any other appropriate equitable relief to 
redress a violation of any such provision; or 
"(C) by any participant or beneficiary to recover benefits due 
to him or her under the provisions of subchapter III of this 
chapter, to enforce his or her rights under such provisions, or to 
clarify his or her rights to future benefits under such provisions. 
"(3) An action may not be commenced under paragraph (2) with 
respect to a fiduciary's breach of any responsibility, duty, or obliga-
tion under subsection (b) or a violation of subsection (c) after the 
earlier o
f
— 
"(A) 6 years after (i) the date of the last action which con-
stituted a part of the breach or violation, or (ii) in the case of an 
omission, the latest date on which the fiduciary could have 
cured the breach or violation; or 
100 STAT. 586 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(B) 3 years after the earliest date on which the plaintiff had 
actual knowledge of the breach or violation, except that, in the 
case of fraud or concealment, such action may be commenced 
not later than 6 years after the date of discovery of such breach 
or violation. 
Courts, U.S. 
"(4)(A) The district courts of the United States shall have exclu-
sive jurisdiction of civil actions under this subsection. 
"(B) An action under this subsection may be brought in the 
District Court of the United States for the District of Columbia or a 
district court of the United States in the district where the breach 
alleged in the complaint or petition filed in the action took place or 
in the district where a defendant resides or may be found. Process 
may be served in any other district where a defendant resides or 
may be found. 
"(5)(A) A copy of the complaint or petition filed in any action 
brought under this subsection (other than by the Secretary of Labor) 
shall be served on the Executive Director, the Secretary of Labor, 
and the Secretary of the Treasury by certified mail. 
"(B) Any officer referred to in subparagraph (A) of this paragraph 
shall have the right in his discretion to intervene in any action. If 
the Secretary of Labor brings an action under paragraph (2) of this 
subsection on behalf of a participant or beneficiary, he shall notify 
the Executive Director and the Secretary of the Treasury. 
"(f) The Secretary of Labor may prescribe regulations to carry out 
this section. 
"(g)(1) The Secretary of Labor shall establish a program to carry 
out audits to determine the level of compliance with the require-
ments of this section relating to fiduciary responsibilities and 
prohibited activities of fiduciaries. 
"(2) An audit under this subsection may be conducted by the 
Secretary of Labor, by contract with a qualified non-governmental 
organization, or in cooperation with the Comptroller General of the 
United States, as the Secretary considers appropriate. 
5 use 8478. 
"§ 8478. Bonding 
"(aXD Except as provided in paragraph (2), each fiduciary (other 
than a member of the Employee Thrift Advisory Council with 
respect to his duties as a member) and each person who handles 
funds or property of the Thrift Savings Fund shall be bonded as 
provided in this section. 
"(2)(A) Bond shall not be required of a fiduciary (or of any officer 
or employee of such fiduciary) if such fiduciary— 
"(i) is a corporation organized and doing business under the 
laws of the United States or of any State; 
"(ii) is authorized under such laws to exercise trust powers or 
to conduct an insurance business; 
"(iii) is subject to supervision or examination by Federal or 
State authority; and 
"(iv) has at all times a combined capital and surplus in excess 
of such minimum amount (not less than $1,000,000) as the 
Secretary of Labor prescribes in regulations. 
"(B) If— 
"(i) a bank or other financial institution would, but for this 
subparagraph, not be required to be bonded under this section 
by reason of the application of the exception provided in 
subparagraph (A), 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 587 
"(ii) the bank or financial institution is authorized to exercise 
trust powers, and 
"(iii) the deposits of the bank or financial institution are not 
insured by the Federal Deposit Insurance Corporation or the 
Federal Savings and Loan Insurance Corporation, 
such exception shall apply to such bank or financial institution only 
if the bank or institution meets bonding requirements under State 
law which the Secretary of Labor determines are at least equivalent 
to those imposed on banks by Federal law. 
"(bXD The Secretary of Labor shall prescribe the amount of a 
bond under this section at the beginning of each fiscal year. Except 
as otherwise provided in this paragraph, such amount shall not be 
less than 10 percent of the amount of funds handled. In no case shall 
such bond be less than $1,000 nor more than $500,000, except that 
the Secretary of Labor, after due notice and opportunity for hearing 
to all interested parties, and other consideration of the record, may 
prescribe an amount in excess of $500,000. 
"(2) For the purpose of prescribing the amount of a bond under 
paragraph (1), the amount of funds handled shall be determined by 
reference to the amount of the funds handled by the person, group, 
or class to be covered by such bond or by their predecessor or 
predecessors, if any, during the preceding fiscal year, or to the 
amount of funds to be handled during the current fiscal year by 
such person, group, or class, estimated as provided in regulations 
prescribed by the Secretary of Labor. 
"(c) A bond required by subsection (a)— 
"(1) shall include such terms and conditions as the Secretary 
of Labor considers necessary to protect the Thrift Savings Fund 
against loss by reason of acts of fraud or dishonesty on the part 
of the bonded person directly or through connivance with 
others; 
"(2) shall have as surety thereon a corporate surety company 
which is an acceptable surety on Federal bonds under authority 
granted by the Secretary of the Treasury pursuant to sections 6 
through 13 of title 6; and 
"(3) shall be in a form or of a type approved by the Secretary 
of Labor, including individual bonds or schedule or blanket 
forms of bonds which cover a group or class. 
"(dXD It shall be unlawful for any person to whom subsection (a) 
applies, to receive, handle, disburse, or otherwise exercise custody or 
control of any of the funds or other property of the Thrift Savings 
Fund without being bonded as required by this section. 
"(2) It shall be unlawful for any fiduciary, or any other person 
having authority to direct the performance of functions described in 
paragraph (1), to permit any such function to be performed by any 
person to whom subsection (a) applies unless such person has met 
the requirements of such subsection. 
"(e) Notwithstanding any other provision of law, any person who 
is required to be bonded as provided in subsection (a) shall be 
exempt from any other provision of law which would, but for this 
subsection, require such person to be bonded for the handling of the 
funds or other property of the Thrift Savings Fund. 
"(f) The Secretary of Labor shall prescribe such regulations as Regulations 
may be necessary to carry out the provisions of this section, includ-
ing exempting a person or class of persons from the requirements of 
this section. 
Law enforce-
ment and 
crime. 
100 STAT. 588 
PUBLIC LAW 99-335—JUNE 6, 1986 
5 use 8479. 
"§ 8479. Exculpatory provisions; insurance 
"(a) Any provision in an agreement or instrument which purports 
to relieve a fiduciary fi-om responsibility or liability for any respon-
sibility, obligation, or duty under this subchapter shall be void. 
"(bXD The Executive Director may require employing agencies to 
contribute an amount not to exceed 1 percent of the amount such 
agencies are required to contribute in accordance with section 
8432(c) of this title to the Thrift Savings Fund. 
"(2) The sums credited to the Thrift Savings Fund under para-
graph (1) shall be available and may be used at the discretion of the 
Executive Director to purchase insurance to cover potential liability 
of persons who serve in a fiduciary capacity with respect to the 
Thrift Savings Fund, without regard to whether a policy of insur-
ance permits recourse by the insurer against the fiduciary in the 
case of a breach of a fiduciary obligation.". 
(b) CONFORMING AMENDMENT.—The table of chapters at the begin-
ning of part III of title 5, United States Code, is amended by 
inserting after the item relating to chapter 83 the following new 
item: 
"84. Federal Employees' Retirement System 
8401.". 
TITLE II—OTHER AMENDMENTS TO TITLE 
5 OF THE UNITED STATES CODE 
SEC. 201. TREATMENT UNDER CIVIL SERVICE RETIREMENT SYSTEM OF 
CERTAIN INDIVIDUALS EXCLUDED FROM FEDERAL EMPLOY-
EES' RETIREMENT SYSTEM. 
(a) DEDUCTIONS, CONTRIBUTIONS, AND DEPOSITS.—(1) Section 8334 
of title 5, United States Code, is amended by adding at the end 
thereof the following: 
"(k)(l) Effective with respect to pay periods beginning after 
December 31, 1986, in administering this section in the case of an 
individual described in section 8402(b)(2) of this title— 
"(A) the amount to be deducted and withheld by the employ-
ing agency shall be determined in accordance with paragraph 
(2) of this subsection instead of the first sentence of subsection 
(a)(1) of this section; and 
"(B) the amount of the contribution under the second sen-
tence of subsection (a)(1) of this section shall be the amount 
which would have been contributed under such sentence if this 
subsection had not been enacted. 
"(2)(A) With respect to Federal wages of an employee or Member 
(or that portion thereof) not exceeding the contribution and benefit 
base during the calendar year involved, the appropriate amount to 
be deducted and withheld under this subsection is the amount by 
which— 
"(i) the total deduction for those wages (or for that portion) 
exceeds; 
"(ii) the OASDI contribution with respect to those wages (or 
that portion). 
"(B) With respect to any portion of Federal wages of an employee 
or Member which exceed the contribution and benefit base during 
the calendar year involved, the appropriate amount to be deducted 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 589 
and withheld under this subsection is an amount equal to the total 
deduction for that portion. 
"(C) For purposes of this paragraph— 
"(i) the term 'Federal wages' means basic pay for service as an 
employee or Member, as the case may be; 
"(ii) the term 'contribution and benefit base' means the con-
tribution and benefit base in effect with respect to the period 
involved, as determined under section 280 of the Social Security 
Act; 
42 u s e 430. 
"(iii) the term 'total deduction', as used with respect to any 
Federal wages (or portion thereof), means an amount equal to 
the amount of those wages (or of that portion), multiplied by the 
percentage which (but for this subsection) would apply under 
the first sentence of subsection (a)(1) with respect to the individ-
ual involved; and 
"(iv) the term 'OASDI contribution', with respect to any 
income, means the amount of tax which may be imposed under 
section 3101(a) of the Internal Revenue Code of 1954 with 
26USC3ioi. 
respect to such income (determined without regard to any 
income which is not a part of Federal wages). 
"(3) The amount of a deposit under subsection (c) of this section for 
any service with respect to which paragraph (1) of this subsection 
applies shall be equal to an amount determined based on the 
preceding provisions of this subsection, and shall include interest.". 
(2) Such section 8334 is further amended— 
(A) in paragraphs (1) and (2) of subsection (e), by striking out 
"or (j)" and inserting in lieu thereof "(j), or (k)"; 
(B) in subsection (f), by inserting or (k)" after "subsection 
(a)"; and 
(C) in subsection (h), by striking out "and (j)" and inserting in 
lieu thereof "(j), and (k)". 
O
t
>
) OFFSET IN BENEFITS.—(1) Subchapter III of chapter 83 of title 5, 
United States Code, is amended by adding at the end thereof the 
5 USC 8331. 
following: 
Post, pp. 591-
593. 
"§8349. Offset relating to certain benefits under the Social 
5 use 8349. 
Security Act 
42 use i305. 
"(a)(1) Notwithstanding any other provision of this subchapter, if 
an individual under section 84020t))(2) is entitled, or would on proper 
application be entitled, to old-age insurance benefits under title II of 
the Social Security Act, the annuity otherwise payable to such 
42 use 401. 
individual shall be reduced under this subsection. 
"(2) A reduction under this subsection commences beginning with 
the first month for which the individual both— 
"(A) is entitled to an annuity under this subchapter; and 
"(B) is entitled, or would on proper application be entitled, to 
old-age insurance benefits under title II of the Social Security 
Act. 
"(3)(A)(i) Subject to clause (ii) and subparagraphs (B) and (C), the 
amount of a reduction under this subsection shall be equal to the 
difference between— 
"(I) the old-age insurance benefit which would be payable to 
the individual for the month referred to in paragraph (2); and 
"(II) the old-age insurance benefit which would be so payable, 
excluding all wages derived from Federal service of the individ-
ual, and assuming the individual were fully insured (as defined 
by section 214(a) of the Social Security Act). 
42 use 414. 
100 STAT. 590 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(ii) For purposes of this subsection, the amount of a benefit 
referred to in subclause (I) or (II) of clause (i) shall be determined 
without regard to subsections (b) through (1) of section 203 of the 
42 use 403. 
Social Security Act, and without regard to the requirement that an 
application for such benefit be filed. 
(B) A reduction under this subsection— 
"(i) may not exceed £in amount equal to the product of^ 
"(I) the old-age insurance benefit to which the individual 
is entitled (or would on proper application be entitled) for 
the month referred to in paragraph (2), determined without 
regard to subsections (b) through (1) of section 203 of the 
Social Security Act; and 
"(II) a fraction, as determined under section 8421(b)(3) 
with respect to the individual, except that the reference to 
'service' in subparagraph (A) of such section shall be consid-
ered to mean Federal service; and 
"(ii) may not cause the annuity payment for an individual to 
be reduced below zero. 
"(C) An amount computed under subclause (I) or (II) of subpara-
graph (A)(i), or under subparagraph (B)(iXI), for purposes of deter-
mining the amount of a reduction under this subsection shall be 
adjusted under section 8340 of this title. 
'(4) A reduction under this subsection applies with respect to the 
annuity otherwise payable to such individual under this subchapter 
(other than under section 8337) for the month involved— 
"(A) based on service of such individual; and 
"(B) without regard to section 8345(j), if otherwise applicable. 
"(5) The operation of the preceding paragraphs of this subsection 
shall not be considered for purposes of applying the provisions of the 
second sentence of section 215(aX7)(B)(i) or the provisions of section 
215(d)(5)(ii) of the Social Security Act in determining any amount 
under subclause (I) or (II) of paragraph (3)(A)(i) or paragraph 
(3)(BXi)(I) for purposes of this subsection. 
"(b)(1) Notwithstanding any other provision of this subchapter— 
"(A) a disability annuity to which an individual described in 
section 84020t>X2) is entitled under this subchapter, and 
"(B) a survivor annuity to which a person is entitled under 
this subchapter based on the service of an individual described 
in section 8402(bX2), 
shall be subject to reduction under this subsection if that individual 
or person is also entitled (or would on proper application also be 
entitled) to any similar benefits under title II of the Social Security 
42 use 401. 
Act based on the wages and self-employment income of such individ-
ual described in section 8402(bX2). 
"(2XA) Subject to subparagraph (B), reductions under this subsec-
tion shall be made in a manner consistent with the manner in which 
reductions under subsection (a) are computed and otherwise made. 
"(B) Reductions under this subsection shall be discontinued if, or 
for so long as, entitlement to the similar benefits under title II of the 
Social Security Act (as referred to in paragraph (1)) is terminated 
(or, in the case of an individual who has not made proper application 
therefor, would be terminated). 
"(3) For the purpose of applying section 224 of the Social Security 
Ante, pp. 286, 
Act to the disability insurance benefit used to compute the reduction 
287. 
under this subsection, the amount of the CSRS annuity considered 
shall be the amount of the CSRS annuity before application of this 
section. 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 591 
42 use 401. 
26 use 3101 
et seq. 
26 use 3121 and 
3121 note; 
42 use 409-410 
note. 
5 use 8331 note. 
5 u s e 8331 note. 
"(4) The Office shall prescribe regulations to carry out this 
Regulations 
subsection. 
"(c) For the purpose of this section, the term 'Federal service' 
means service which is employment for the purposes of title II of the 
Social Security Act and chapter 21 of the Internal Revenue Code of 
1954 by reason of the amendments made by section 101 of the Social 
Security Amendments of 1983.". 
(2) The analysis for chapter 83 of title 5, United States Code, is 
amended by adding at the end thereof the following new item: 
"8349. Offset relating to certain benefits under the Social Security Act.". 
(c) CREDITABIUTY OF INTERIM SERVICE.—Section 8334(c) of title 5, 
United States Code, is amended by adding at the end thereof the 
following: "Notwithstanding the preceding provisions of this subsec-
tion and any provision of section 206(b)(3) of the Federal Employees' 
Retirement Contribution Temporary Adjustment Act of 1983, the 
percentage of basic pay required under this subsection in the case of 
an individual described in section 8402(b)(2) shall, with respect to 
any covered service (as defined by section 203(a)(3) of such Act) 
performed by such individual after December 31, 1983, and before 
January 1,1987, be equal to 1.3 percent.". 
SEC. 202. NON-APPLICABILITY OF CIVIL SERVICE RETIREMENT SYSTEM 
TO INDIVIDUALS UNDER FEDERAL EMPLOYEES' RETIREMENT 
SYSTEM. 
(a) EMPLOYEES.—Section 8331(1) of title 5, United States Code, is 
amended— 
(1) by amending clause (ii) to read £is follows: 
"(ii) an employee subject to another retirement system for 
Government employees (other than an employee described in 
clause (x);"; 
(2) by striking "or" at the end of clause (viii); 
(3) by striking the period at the end of clause (ix) and insert-
ing in lieu thereof "; or"; and 
(4) by adding after clause (ix) the following: 
"(x) an employee subject to the Federal Employees' Retire-
ment System. . 
(b) MEMBERS OF CONGRESS.—Section 8331(2) of title 5, United 
States Code, is amended by striking the semicolon and inserting in 
lieu thereof ", but does not include any such Member of Congress 
who is subject to the Federal Employees' Retirement System or who 
makes an election under section 8401(20) of this title not to be 
subject to such System;". 
SEC. 203. PAY FOR THE EXECUTIVE DIRECTOR OF THE FEDERAL RETIRE-
MENT THRIFT INVESTMENT BOARD. 
Section 5314 of title 5, United States Code, is amended by adding 
at the end thereof the following: 
"Executive Director, Federal Retirement Thrift Investment 
Board.". 
SEC. 204. ALTERNATIVE FORMS OF ANNUITIES. 
(a) IN GENERAL.—Title 5, United States Code, is amended by 
inserting after section 8343 the following: 
"§ 8343a. Alternative forms of annuities 
Regulations. 
"(a) The Office of Personnel Management shall prescribe regula-
tions under which an employee or Member may, at the time of 
100 STAT. 592 
PUBLIC LAW 99-335—JUNE 6, 1986 
retiring under this subchapter (other than under section 8337 of this 
title), elect annuity benefits under this section instead of any other 
benefits under this subchapter (including any benefits under section 
8341 of this title) based on the service of the employee or Member. 
Regulations. 
"(b) Subject to subsection (c), the Office shall by regulation provide 
for such alternative forms of annuities as the Office considers 
appropriate, except that among the alternatives offered shall be— 
"(1) an alternative which provides for— 
"(A) payment of the lump-sum credit to the employee or 
Member; and 
"(B) payment of an annuity to the employee or Member 
for life; and 
"(2) in the case of an employee or Member who is married at 
the time of retirement, an alternative which provides for— 
"(A) payment of the lump-sum credit to the employee or 
Member; and 
"(B) pajrment of an annuity to the employee or Member 
for life, with a survivor annuity payable for the life of a 
surviving spouse. 
"(c) Each alternative provided for under subsection (b) shall, to the 
extent practicable, be designed such that the present value of the 
benefits provided under such alternative (including any lump-sum 
credit) is actuarially equivalent to the present value of the annuity 
which would otherwise be provided the employee or Member under 
this subchapter, as computed under subsections (a)-(i) and (n) of 
section 8339 of this title. 
"(d) An employee or Member who, at the time of retiring under 
this subchapter— 
"(1) is married, shall be ineligible to make an election under 
this section unless a waiver is made under section 8339(j)(l) of 
this title; or 
"(2) has a former spouse, shall be ineligible to make an 
election under this section if the former spouse is entitled to 
benefits under section 8341(h) or 8345(j) of this title (based on 
the service of the employee or Member) under the terms of a 
decree of divorce or annulment, or a court order or court-
approved property settlement incident to any such decree, with 
respect to which the Office has been duly notified. 
"(e) An employee or Member who is married at the time of 
retiring under this subchapter and who makes an election under 
this section may, during the 18-month period beginning on the date 
of retirement, make the election provided for under section 8339(o) 
of this title, subject to the deposit requirement thereunder.". 
(b) CONFORMING AMENDMENTS.—(1) The analysis for chapter 83 of 
title 5, United States Code, is amended by inserting after the item 
relating to section 8343 the following: 
"8343a. Alternative forms of annuities.". 
(2) The second sentence of section 8342(a) of title 5, United States 
Code, is amended by striking "The" and inserting in lieu thereof 
"Except as provided in section 8343a of this title, the". 
SEC. 205. RETIREMENT COUNSELING. 
(a) IN GENERAL.—Subchapter III of chapter 83 of title 5, United 
States Code, as amended by section 201(b), is further amended by 
adding at the end thereof the following: 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 593 
"§ 8350. Retirement counseling 
5 USC 8350. 
"(a) For the purposes of this section, the term 'retirement coun-
selor', when used with respect to an agency, means an employee of 
the agency who is designated by the head of the agency to furnish 
information on benefits under this subchapter and chapter 84 of this 
title and counseling services relating to such benefits to other 
Ante, p. 517. 
employees of the agency. 
"(b) The Director of the Office of Personnel Management shall 
establish a training program for all retirement counselors of agen-
cies of the Federal Government. 
"(cXD The training program established under subsection (bXD of 
this section shall provide for comprehensive training in the provi-
sions and administration of this subchapter and chapter 84 of this 
title, shall be designed to promote fully informed retirement deci-
sions by employees and Members under this subchapter and individ-
uals subject to chapter 84 of this title, and shall be revised as 
necessary to assure that the information furnished to retirement 
counselors of agencies under the program is current. 
"(2) The Director shall conduct a training session under the 
training program at least once every 3 months. 
"(3) Once each year, each retirement counselor of an agency shall 
successfully complete a training session conducted under the train-
ing program.". 
(b) CHAPTER ANALYSIS.—The chapter analysis at the beginning of 
such chapter is amended by inserting after the item relating to 
section 8349 the following: 
"8350. Retirement counseling.". 
SEC. 206. PARTICIPATION BY CERTAIN EMPLOYEES AND MEMBERS ONLY 
IN THE THRIFT SAVINGS PLAN. 
(a)(1) Subchapter III of chapter 83 of title 5, United States Code (as 
amended by sections 201(b) and 205(a) of this Act), is amended by 
adding at the end thereof the following new section: 
*'§ 8351. Participation in the Thrift Savings Plan 
5 USC 8351. 
"(a)(1) An employee or Member may elect to contribute to the 
Thrift Savings Fund established by section 8437 of this title. 
"(2) An election may be made under paragraph (1) only during a 
period provided under section 8432(b) for individuals who are subject 
to chapter 84 of this title. 
"Ot>)(l) Except as otherwise provided in this subsection, the provi-
sions of subchapters III and VII of chapter 84 of this title shall apply 
with respect to employees and Members making contributions to the 
Thrift Savings Fund under subsection (a) of this section. 
"(2) An employee or Member may contribute to the Thrift Savings 
Fund in any pay period any amount not exceeding 5 percent of the 
amount of the employee's or Member's basic pay for such period. 
"(3) No contributions may be made by an employing agency for 
the benefit of an employee or Member under section 8432(c) of this 
title. 
"(4) Section 8433(b) of this title applies to any employee or 
Member who elects to make contributions to the Thrift Savings 
Fund under subsection (a) of this section and separates from Govern-
ment employment entitled to an immediate annuity under this 
subchapter (including a disability retirement annuity under section 
100 STAT. 594 
PUBLIC LAW 99-335—JUNE 6, 1986 
8337 of this title) or separates from Government employment enti-
5 use 8101. 
tied to benefits under subchapter I of chapter 81 of this title. 
"(5) Section 8433(c) of this title applies to any employee or 
Member who elects to make contributions to the Thrift Savings 
Fund under subsection (a) of this section and separates entitled to a 
deferred annuity under this subchapter. 
"(6) Section 8433(d) of this title applies to any employee or 
Member who elects to make contributions to the Thrift Savings 
Fund under subsection (a) of this section and separates from the 
service before becoming entitled to an immediate or deferred annu-
ity under this subchapter. 
"(7)(A) The provisions of section 8435 of this title that require a 
waiver or consent by the spouse of an employee or Member (or 
former employee or Member) shall not apply with respect to sums in 
the Thrift Savings Fund contributed by the employee or Member (or 
former employee or Member) and earnings in the fund attributable 
to such sums. 
Loans. 
"(B) An election, change of election, or modification (relating to 
the commencement date of a deferred annuity) authorized by sub-
chapter III of chapter 84 of this title shall be effective in the case of 
a married employee or Member, and a loan may be approved under 
section 8433(i) of this title in such case, only after the Executive 
Director notifies the employee's or Member's spouse that the elec-
tion, change of election, or modification has been made or that the 
Executive Director has received an application for such loan, as the 
case may be. 
"(C) Subparagraph (B) may be waived with respect to a spouse or 
former spouse if the employee or Member establishes to the satisfac-
tion of the Executive Director of the Federal Retirement Thrift 
Investment Board that the whereabouts of such spouse or former 
spouse cannot be determined. 
Securities. 
"(8) Sums Contributed under this section and earnings attrib-
utable to such sums may be invested and reinvested only in the 
Government Securities Investment Fund established under section 
8438(b)(1)(A) of this title. 
Regulations. 
"(c) The Executive Director of the Federal Retirement Thrift 
Investment Board may prescribe regulations to carry out this 
section.". 
(2) The analysis for chapter 83 of such title is amended by adding 
at the end thereof the following: 
5 u s e 8351 note. 
"8351. Participation in the Thrift Savings Plan.". 
(b) An election may first be made by an employee of the Federal 
Government or a Member of Congress under section 8351 of title 5, 
United States Code (as added by subsection (a)(1)), during the first 
period referred to in subsection (a)(2) of such section which com-
mences on or after July 1,1987. 
SEC. 207. MISCELLANEOUS AMENDMENTS. 
(a) AMENDMENT TO SECTION 2105.—Section 2105(c)(2) of title 5, 
United States Code, is amended by striking out "chapter 81" and 
inserting in lieu thereof "chapter 81, chapter 84,". 
03) AMENDMENT TO SECTION 2109.—Section 2109(1) of title 5, 
United States Code, is amended to read as follows: 
"(1) 'air traffic controller' or 'controller' means a civilian 
employee of the Department of Transportation or the Depart-
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 595 
ment of Defense who, in an air traffic control facility or flight 
service station facility— 
"(A) is actively engaged— 
"(i) in the separation and control of air traffic; or 
"(ii) in providing preflight, inflight, or airport ad-
visory service to aircraft operators; or 
"(B) is the immediate supervisor of any employee de-
scribed in subparagraph (A); and". 
(c) AMENDMENT TO SECTION 6301.—Section 6301(2)(B) of title 5, 
United States Code, is amended to read as follows: 
"(B) an individual first employed by the government of 
the District of Columbia before October 1,1987;". 
(d) AMENDMENT TO SECTION 6303.—The second sentence of section 
6303(a) of title 5, United States Code, is amended by striking out 
"title." and inserting in lieu thereof "title and all service creditable 
under section 8411 of this title for the purpose of chapter 84 of this 
title.". 
(e) AMENDMENT TO SECTION 8116.—Section 8116 of title 5, United 
States Code, is amended by adding at the end thereof the following: 
"(d) Notwithstanding the other provisions of this section, an 
individual receiving benefits for disability or death under this sub-
chapter who is also receiving benefits under subchapter III of chap-
ter 84 of this title or benefits under title II of the Social Security Act 
shall be entitled to all such benefits, except that— 
"(1) benefits received under section 223 of the Social Security 
Act (on account of disability) shall be subject to reduction on 
account of benefits paid under this subchapter pursuant to the 
provisions of section 224 of the Social Security Act; and 
"(2) in the case of benefits received on account of age or death 
under title II of the Social Security Act, compensation payable 
under this subchapter beised on the Federal service of an em-
ployee shall be reduced by the amount of any such social 
security benefits payable that are attributable to Federal serv-
ice of that employee covered by chapter 84 of this title. How-
ever, eligibility for or receipt of benefits under chapter 84 of this 
title, or benefits under title II of the Social Security Act by 
virtue of service covered by chapter 84 of this title, does not 
affect the right of the employee to compensation for scheduled 
disabilities specified by section 8107(c) of this title.". 
if) AMENDMENTS TO SECTION 8331.—Section 8331(1) of title 5, 
United States Code, as amended by section 202(a), is further 
amended— 
(1) by amending subparagraph (G) to read as follows: 
"(G) an individual first employed by the government of 
the District of Columbia before October 1,1987;"; and 
(2) by striking out "or" at the end of clause (ix), by striking 
out the period at the end of clause (x) and inserting in lieu 
thereof "; or", and by adding after clause (x) the following: 
"(xi) an employee under the Botanic Garden excluded by 
the Director or Acting Director of the Botanic Garden 
under section 8347(1) of this title.", 
(g) AMENDMENTS TO SECTION 8332.—(1) Section 8332(b) of title 5, 
United States Code, is amended— 
(A) by striking "and" at the end of paragraph (12), striking 
the period at the end of the first paragraph (13) and inserting a 
semicolon, redesignating the second paragraph (13) as para-
District of 
Columbia. 
Ante, p. 517. 
42 use 401. 
42 use 423. 
42 use 424a. 
District of 
Columbia. 
100 STAT. 596 
PUBLIC LAW 99-335—JUNE 6, 1986 
graph (14), and striking the period at the end of such paragraph 
(14) (as so redesignated) and inserting "; and"; 
(B) by inserting after paragraph (14) (as so redesignated by 
subparagraph (A)) the following: 
District of 
"(15) subject to sections 8334(c) and 8339(i) of this title, service 
Columbia. 
performed on or after January 3, 1969, and before January 4, 
Virgki Islands 
1973, as the Washington Representative for Guam or the 
Washington Representative for the Virgin Islands, only if the 
individual serves as a Member for a period of at least five years 
after January 2,1973."; 
(C) in the second sentence after paragraph (15) (as added by 
subparagraph (B)), by striking "(13)" and inserting "(14)"; and 
(D) by adding at the end thereof the following: "For the 
purpose of this subchapter, service of the type described in 
paragraph (15) of this subsection shall be considered Member 
service.". 
(2) The last sentence of section 8332(f) of title 5, United States 
Code, is amended by striking "(13)" and inserting "(14)". 
(3) The last sentence of section 8332(kXl) of title 5, United States 
Code, is amended by striking "second" and inserting "third". 
(h) AMENDMENTS TO SECTION 8342.—Section 8342(a) of title 5, 
United States Code, is amended— 
(1) in paragraphs (IXB) and (3), by inserting ", or chapter 84 of 
Ante, p. 517. 
this title," after "subchapter"; and 
(2) by adding at the end the following: "In applying this 
subsection with respect to an employee or Member who becomes 
subject to chapter 84 of this title, entitlement to payment of the 
lump-sum credit shall be determined without regard to para-
graph (1) or (3) if, and to the extent that, such lump-sum credit 
relates to service of a type described in clauses (i) through (iii) of 
section 302(a)(lXC) of the Federal Employees' Retirement 
System Act of 1986.". 
(i) AMENDMENT TO SECTION 8347.—Section 8347 of title 5, United 
States Code, is amended by adding at the end thereof the following: 
"(nXl) Notwithstanding any other provision of this subchapter, 
the Director of Central Intelligence shall, in a manner consistent 
with the administration of this subchapter by the Office, and to the 
extent 
considered 
appropriate 
by 
the 
Director 
of 
Central 
Intelligence— 
"(A) determine entitlement to benefits under this subchapter 
based on the service of employees of the Central Intelligence 
Agency; 
Records. 
"(B) maintain records relating to the service of such 
employees; 
"(C) compute benefits under this subchapter based on the 
service of such employees; 
"(D) collect deposits to the Fund made by such employees, 
their spouses, and their former spouses; 
"(E) authorize and direct disbursements from the Fund to the 
extent bsised on service of such employees; and 
"(F) perform such other functions under this subchapter as 
the Director of Central Intelligence, in consultation with the 
Director of the Office of Personnel Management, determines to 
be appropriate. 
"(2) The Director of the Office of Personnel Management shall 
furnish such information and, on a reimbursable basis, such services 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 597 
to the Director of Central Intelligence as the Director of Central 
Intelligence requests to carry out paragraph (1) of this subsection. 
"(3)(A) The Director of Central Intelligence, in consultation with 
Regulations. 
the Director of the Office of Personnel Management, shall by regula-
tion prescribe appropriate procedures to carry out this subsection. 
"(B) The regulations shall provide procedures for the Director of 
the Office of Personnel Management to inspect and audit disburse-
ments from the Civil Service Retirement and Disability Fund under 
this subchapter. 
"(C) The Director of Central Intelligence shall submit the regula-
tions prescribed under subparagraph (A) to the Select Committee on 
Intelligence of the Senate and the Permanent Select Committee on 
Intelligence of the House of Representatives before the regulations 
take effect. 
"(4)(A) Section 201(c) of the Central Intelligence Agency Retire-
ment Act of 1964 for Certain Employees shall apply in the adminis- 50 USC 403 note. 
tration of this subchapter to the extent that the provisions of this 
subchapter are administered under this subsection. 
"(B) Notwithstanding subparagraph (A) of this paragraph, section 
8347(d) of this title shall apply with respect to employees of the 
Central Intelligence Agency who are subject to the Civil Service 
Retirement System.". 
(j) AMENDMENTS TO SECTION 8348.—Section 8348(a) of title 5, 
United States Code, is amended— 
(1) in paragraph (IXA), by striking out "subchapter;" and 
inserting in lieu thereof "subchapter or by the provisions of 
chapter 84 of this title which relate to benefits payable out of 
Ante, p. 517. 
the Fund;"; 
(2) in paragraph dXB)— 
(A) by inserting "or 8462" after "8340"; and 
(B) by striking out "title, and" and inserting in lieu 
thereof "title or subchapters II and IV of chapter 84 of this 
title, and"; and 
(3) in paragraph (2), by striking out "chapter" and inserting in 
lieu thereof "chapter, chapter 84 of this title,". 
(k) AMENDMENTS TO CHAPTER 87.—Chapter 87 of title 5, United 
5 use 8701 
States Code, is amended— 
«
^ s^9 
(1) by amending section 8701(a)(6) to read as follows: 
"(6) an individual first employed by the government of the 
District of Columbia before October 1,1987;"; 
(2) in section 8706, by striking out subsection (c) and 
redesignating subsections (d), (e), and (f) as subsections (c), (d), 
and (e), respectively; 
(3) by striking out subsection (cXD of section 8714a and insert-
ing in lieu thereof the following: 
"(cXl) Except as otherwise provided in this subsection, the op- Insurance. 
tional insurance on an employee stops on his separation from 
service or 12 months after discontinuance of his pay, whichever is 
earlier, subject to a provision for temporary extension of life insur-
ance coverage and for conversion to an individual policy of life 
insurance under conditions approved by the Office."; 
(4) by striking out the first sentence of section 8714b(cXl) and 
inserting in lieu thereof the following: "Except as otherwise 
provided in this subsection, the additional optional insurance 
elected by an employee pursuant to this section shall stop on 
separation from service or 12 months after discontinuance of his 
pay, whichever is earlier, subject to a provision for temporary 
100 STAT. 598 
PUBLIC LAW 99-335—JUNE 6, 1986 
extension of life insurance coverage and for conversion to an 
individual policy of life insurance under conditions approved by 
the Office."; and 
(5) by striking out subsection (c)(1) of section 8714c and insert-
ing in lieu thereof the following: 
"(cXl) Except as otherwise provided in this subsection, the op-
tional life insurance on family members shall stop at the earlier of 
the employee's death, the employee's separation from the service, or 
12 months after discontinuance of pay, subject to a provision for 
temporary extension of life insurance coverage and for conversion to 
individual policies of life insurance under conditions approved by 
the Office.". 
(1) AMENDMENTS TO SECTION 8901.—Section 8901 of title 5, United 
States Code, is amended— 
(1) by amending paragraph (IKE) to read as follows: 
District of 
"(E) an individual first employed by the government of 
Columbia. 
the District of Columbia before October 1,1987;"; 
(2) by amending paragraph (3)(A) to read as follows: 
"(A) an employee who retires— 
"(i) on an immediate annuity under subchapter III of 
Ante, pp. 589, 
chapter 83 of this title, or another retirement system 
591-593. 
for employees of the Government, after 5 or more years 
of service; 
"(ii) under section 8412 or 8414 of this title; or 
"(iii) for disability under subchapter III of chapter 83 
Ante, p. 517. 
of this title, chapter 84 of this title, or another retire-
ment system for employees of the Government;"; 
(3) in paragraph (4), by inserting "or chapter 84" after "83"; 
(4) in paragraph (lOXCXi), by inserting "or 8467" after 
"8345(j)", by inserting "or 8445" after "8341(h)", and by striking 
out "System)," and inserting in lieu thereof "System or the 
Federal Employees' Retirement System),"; and 
(5) in paragraph (lOXCXii)— 
(A) by striking out "or 8345(j)" and inserting in lieu 
thereof "8345(j), 8445, or 8467" and by striking out 
"System)" and inserting in lieu thereof "System or the 
Federal Employees' Retirement System)"; and 
(B) by inserting "or 8417(b)" after "8339(jX3)". 
(m) AMENDMENTS TO SECTION 8905.—Section 8905(cXl) of title 5, 
United States Code, is amended— 
(1) in subparagraph (B), by inserting "or 84170t))" after 
"8339(jX3)"; and 
(2) in the second sentence, by striking out "or 8345(j)" and 
inserting in lieu thereof "8345(j), 8445, or 8467". 
(n) AMENDMENT TO SECTION 5102.—Section 5102(cX14) of title 5, 
United States Code, is amended by inserting "(other than employees 
of the Federal Retirement Thrift Investment Management System 
appointed under section 8474(cX2) of this title)" after "United 
States". 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 599 
TITLE III—OTHER PROVISIONS RELATING 
TO THE FEDERAL EMPLOYEES' RE-
TIREMENT SYSTEM AND THE CIVIL 
SERVICE RETIREMENT SYSTEM 
SEC. 301. ELECTIONS. 
5 USC 8331 note. 
(a) ELECTIONS FOR INDIVIDUALS SUBJECT TO THE CIVIL SERVICE 
RETIREMENT SYSTEM.—(IXA) Any individual (other than an individ-
ual under subsection (b)) who, as of June 30,1987, is employed by the 
Federal Government, and who is then subject to subchapter III of 
chapter 83 of title 5, United States Code, may elect to become subject 
Ante, pp. 589, 
to chapter 84 of such title. 
591-593. 
(B) An election under this paragraph may not be made before 
'^"^^' P ^ ' 
July 1,1987, or after December 31,1987. 
(2)(A) Any individual who, after June 30, 1987, becomes re-
employed by the Federal Government, and who is then subject to 
subchapter III of chapter 83 of title 5, United States Code, may elect 
to become subject to chapter 84 of such title. 
(B) An election under this paragraph shall not be effective unless 
it is made during the six-month period beginning on the date on 
which reemployment commences. 
O
t
)
) ELECTIONS FOR CERTAIN INDIVIDUALS SERVING CONTINUOUSLY 
SINCE DECEMBER 31, 1983.—The following rules shall apply in the 
case of any individual described in section 84020t)Xl) of title 5, 
United States Code: 
(1) If, as of December 31, 1986, the individual is subject to 
subchapter III of chapter 83 of title 5, United States Code, but is 
not subject to section 204 of the Federal Employees' Retirement 
Contribution Temporary Adjustment Act of 1983, the individual 
5 USC 8331 note. 
shall remain so subject to such subchapter unless the individual 
elects, after June 30,1987, and before January 1,1988— 
(A) to become subject to such subchapter under the same 
terms and conditions as apply in the case of an individual 
described in section 8402(b)(2) of such title who is subject to 
such subchapter; or 
(B) to become subject to chapter 84 of such title. 
An individual eligible to make an election under this paragraph 
may make the election described in subparagraph (A) or (B), but 
not both. 
(2) If, as of December 31, 1986, the individual is subject to 
subchapter III of chapter 83 of title 5, United States Code, and is 
also subject to section 204 of the Federal Employees' Retirement 
Contribution 
Temporary 
Adjustment 
Act 
of 
1983, 
the 
individual— 
(A) shall, as of January 1, 1987, become subject to such 
subchapter under the same terms and conditions as apply 
in the case of an individual described in section 840203)(2) of 
such title who is subject to such subchapter; and 
(B) may (during the six-month period described in subsec-
tion (aXlXB)) elect to become subject to chapter 84 of such 
title. 
(3XAXi) If, as of December 31, 1986, the individual is not 
subject to subchapter III of chapter 83 of title 5, United States 
Code, the individual may, during the six-month period described 
100 STAT. 600 
PUBLIC LAW 99-335—JUNE 6, 1986 
in subsection (aXlXB), and if such individual has not since 
become subject to such subchapter pursuant to notification 
Ante, p. 591. 
under section 8331(2) of such title, elect to become subject to 
chapter 84 of such title. 
(ii) An individual who makes an election under this subpara-
graph ceases to be eligible to become subject to subchapter III of 
Ante, pp. 589, 
chapter 83 of title 5, United States Code, pursuant to notifica-
591-593. 
tion under section 8331(2) of such title. 
(B) Except as provided in subparagraph (AXii), nothing in this 
paragraph shall preclude an individual from becoming subject 
to subchapter III of chapter 83 of title 5, United States Code, 
pursuant to notification under section 8331(2) of such title. 
However, an individual who becomes subject to such subchapter 
pursuant to notification under such section 8331(2) after Decem-
ber 31, 1986, shall become subject to such subchapter under the 
same terms and conditions as apply in the case of an individual 
described in section 8402(bX2) of such title who is subject to such 
subchapter. 
(c) EFFECTIVE DATE; IRREVOCABIUTY.—An election made under this 
section— 
(1) shall take effect beginning with the first pay period begin-
ning after the date of the election; and 
(2) shall be irrevocable. 
(d) CONDITION FOR MAKING AN ELECTION; EXTENSION TO SATISFY 
CONDITION.—(1) An election under this section to become subject to 
Ante, p. 517. 
chapter 84 of title 5, United States Code, shall not be considered 
effective in the case of an individual having one or more former 
spouses, unless the election is made with the written consent of such 
former spouse (or each such former spouse, if there is more than 
one). 
(2XA) This subsection applies with respect to a former spouse who 
(based on the service of the individual involved) is entitled to 
benefits under section 8341(h) or 8345(j) of title 5, United States 
Code, under the terms of a decree of divorce or annulment, or a 
court order or court-approved property settlement incident to any 
such decree, with respect to which the Office of Personnel Manage-
ment has been duly notified. 
(B) This subsection does not apply with respect to a former spouse 
who has ceased to be so entitled as a result of remarrying before age 
55. 
(3) The requirement under paragraph (1) shall be considered 
satisfied with respect to a former spouse if the individual seeking to 
make the election establishes to the satisfaction of the Office (in 
accordance with regulations prescribed by the Office)— 
(A) that the former spouse's whereabouts cannot be deter-
mined; or 
(B) that, due to exceptional circumstances, requiring the 
individual to seek the former spouse's consent would otherwise 
be inappropriate. 
(4XA) The Office shall, upon application of an individual, grant an 
extension for such individual to make an election referred to in 
paragraph (1) if such individual— 
(i) files application for extension before the end of the period 
during which such individual would otherwise be eligible to 
make such election; and 
(ii) demonstrates to the satisfaction of the Office that the 
extension is needed to secure the modification of a decree of 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 601 
divorce or annulment (or a court order or court-approved prop-
erty settlement incident to any such decree) in order to satisfy 
the consent requirement under paragraph (1). 
(B) An extension under this paragraph shall be for 6 months or for 
such longer period as the Office considers appropriate. 
(e) EXCLUSIONS.—This section does not apply to an individual 
under section 8331(1)(G) of title 5, United States Code. 
Ante, p. 595. 
SEC. 302. EFFECT OF AN ELECTION UNDER SECTION 301 TO BECOME SUB- 
5 USC 8331 note. 
JECT TO THE FEDERAL EMPLOYEES' RETIREMENT SYSTEM. 
(a) GENERAL AND SPECIAL RULES.—All provisions of chapter 84 of 
title 5, United States Code (including those relating to disability 
Ante, p. 517. 
benefits, survivor benefits, and any reductions to provide for survi-
vor benefits) shall apply with respect to any individual who becomes 
subject to such chapter pursuant to an election under section 301, 
except if, or to the extent that, such provisions are inconsistent with 
the following: 
(1)(A) Any civilian service which is performed before the 
effective date of the election under section 301 shall not be 
creditable under chapter 84 of title 5, United States Code, 
except as otherwise provided in this subsection. 
(B) Any service described in subparagraph (A) which is cov-
ered service within the meaning of section 203(a)(3) of the 
Federal 
Employees' 
Retirement 
Contribution 
Temporary 
Adjustment Act of 1983 (97 Stat. 1107; 5 U.S.C. 8331 note) 
(hereinafter in this section referred to as "covered service") 
shall be creditable under chapter 84 of title 5, United States 
Code, if— 
(i) with respect to any such service performed before 
January 1, 1987, 1.3 percent of basic pay for such service 
was withheld in accordance with such Act or, if either such 
withholding was not made or was made, but the amount so 
withheld was subsequently refunded, 1.3 percent of basic 
pay for such period is deposited to the credit of the Civil 
Service Retirement and Disability Fund (hereinafter in this 
section referred to as the "Fund"), with interest (computed 
under section 8334(e) of such title); and 
(ii) with respect to any such service performed after 
December 31, 1986, and before the effective date of the 
election, an amount equal to the percentage of basic pay for 
such service which would be required to be withheld under 
section 8422(a) of title 5, United States Code, has been 
contributed to the Fund by the individual involved, 
whether by withholdings from pay or, if either no withhold-
ing was made or was made, but the amount withheld was 
subsequently refunded, the aforementioned percentage of 
basic pay for such period is deposited to the credit of the 
Fund, with interest (computed under section 8334(e) of such 
title). 
(C) Any service described in subparagraph (A)— 
(i) which is not covered service; 
(ii) which constitutes service of a type described in section 
8411(b)(3) of title 5, United States Code (determined without 
regard to whether such service was performed before, on, or 
after January 1, 1989, and without regard to the provisions 
of section 8411(f) of such title); and 
(iii) which, in the aggregate, is equal to less than 5 years; 
100 STAT. 602 
PUBLIC LAW 99-335—JUNE 6, 1986 
Ante, p. 517. 
shall be creditable under chapter 84 of such title, subject to 
section 8411(f) of such title. 
(D) Any service described in subparagraph (A)— 
(i) which is not covered service; 
(ii) which constitutes service of a type described in section 
8411(b)(3) of title 5, United States Code (determined without 
regard to whether such service was performed before, on, or 
after Jsuiuary 1, 1989, and without regard to the provisions 
of section 8411(f) of such title); and 
(iii) which, in the aggregate, is equal to 5 years or more; 
shall be creditable for purposes of^ 
(I) section 8410 of such title, relating to the minimum 
period of civilian service required to be eligible for an 
annuity; 
(II) any provision of section 8412 (other than subsection 
(d) or (e) thereof), 8413, 8414, 8442(bXl)(B), or 8451 of such 
title which relates to a minimum period of service for 
entitlement to an annuity; 
(III) the provisions of paragraphs (4) and (6); 
(IV) any provision of section 8412(d) of such title which 
relates to a minimum period of service for entitlement to an 
annuity, but only if and to the extent that the service 
described in subparagraph (A) was as a law enforcement 
officer or firefighter; and 
(V) any provision of section 8412(e) of such title which 
relates to a minimum period of service for entitlement to an 
annuity, but only if and to the extent that the service 
described in subparagraph (A) was as an air 
traffic 
controller. 
(2)(A) Except £is provided in subparagraph (B), the creditabil-
ity under chapter 84 of title 5, United States Code, of any 
military service which is performed before the effective date of 
the election under section 301 shall be determined in accord-
ance with applicable provisions of such chapter. 
(B) If the electing individual has performed service described 
in clauses (i) through (iii) of paragraph (1)(D), service described 
in subparagraph (A) which, but for the provisions of subsection 
O
t
>
)
, would be creditable under subchapter III of chapter 83 of 
Ante, pp. 589, 
title 5, United States Code, as in effect on December 31, 1986, 
591-593. 
shall be creditable for purposes of— 
(i) any provision of section 8412 (other than subsection (d) 
or (e) thereof), 8413, or 8414 of such title which relates to a 
minimum period of service for entitlement to an annuity; 
and 
(ii) the provisions of paragraph (4). 
(3)(A)(i) If the electing individual becomes entitled to an annu-
ity under subchapter II of chapter 84 of title 5, United States 
Code, or dies leaving a survivor or survivors entitled to benefits 
under subchapter IV of such chapter, the annuity for such 
individual shall be equal to the sum of the individual's accrued 
benefits under the Civil Service Retirement System (as 
determined under paragraph (4)) and the individual's accrued 
benefits under the Federal Employees' Retirement System (as 
determined under paragraph (5)). 
(ii) An annuity computed under this subparagraph shall be 
deemed to be the individual's annuity computed under section 
8415 of title 5, United States Code. 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 603 
(B) If the electing individual becomes entitled to an annuity 
under subchapter V of chapter 84 of title 5, United States Code, 
and if it becomes necessary to compute an annuity under 
section 8415 of such title with respect to such individual as a 
result of such individual's having become so entitled, the meth-
odology set forth in subparagraph (A) shall be used in comput-
ing any such annuity under section 8415. 
(4) Except as provided in paragraph (12)(B), accrued benefits 
under this paragraph shall be computed in accordance with 
applicable provisions of subchapter III of chapter 83 of title 5, 
United States Code (but without regard to subsection (j) or (k), ^nte, pp. 589, 
or the second sentence of subsection (e), of section 8339 of such 591-593. 
title) using only any civilian service under paragraph (1)(D), and 
any military service under paragraph (2)(B), which would be 
creditable for purposes of computing an annuity under such 
subchapter. 
(5) Accrued benefits under this paragraph shall be computed 
under section 8415 of title 5, United States Code, using— 
(A) total service creditable under chapter 84 of such title 
Ante, p. 517. 
which is performed on or after the effective date of the 
election under section 301; and 
(B) with respect to service performed before such effective 
date— 
(i) creditable civilian service (as determined under 
applicable provisions of this subsection) other than any 
service described in paragraph (1)(D); and 
(ii) creditable military service (as determined under 
applicable provisions of this subsection) other than any 
service described in paragraph (2)(B). 
(6)(A) For purposes of any computation under paragraph (4) or 
(5), the average pay to be used shall be the largest annual rate 
resulting from averaging the individual's rates of basic pay in 
effect over any 3 consecutive years of creditable service or, in 
the case of an annuity based on service of less than 3 years, over 
the total period of service so creditable, with each rate weighted 
by the period it was in effect. 
(B) For purposes of subparagraph (A), service shall be consid-
ered creditable if it would be considered creditable for purposes 
of determining average pay under chapter 83 or 84 of title 5, 
United States Code. 
5 use 8301 
(7) The cost-of-living adjustments for the annuity of the elect- ^
^ s^g. 
ing individual shall be made as follows: 
(A) The portion of the annuity attributable to paragraph 
(4) shall be adjusted at the time and in the amount provided 
for under section 8340 of title 5, United States Code. 
(B) The portion of the annuity attributable to paragraph 
(5) shall be adjusted at the time and in the amount provided 
for under section 8462 of title 5, United States Code. 
(8) For purposes of any computation under paragraph (4) in 
the case of an individual who retires under section 8412 or 8414 
of title 5, United States Code, or who dies leaving a survivor or 
survivors entitled to benefits under subchapter IV of such 
chapter, sick leave creditable under section 8339(m) of such title 
shall be equal to the number of days of unused sick leave to the 
individual s credit as of the date of retirement or as of the 
effective date of the individual's election under section 301, 
whichever is less. 
100 STAT. 604 
PUBLIC LAW 99-335—JUNE 6, 1986 
(9) In computing the annuity under paragraph (3) for an 
individual retiring under section 8412(g) or 8413(b) of title 5, 
United States Code, the reduction under section 8415(f) of such 
title shall apply with respect to the sum computed under such 
paragraph. 
(10) An annuity supplement under section 8421 of title 5, 
United States Code, shall be computed using the same service as 
is used for the computation under paragraph (5). 
(11) Effective from its commencing date, an annuity payable 
to an annuitant's survivor (other than a child under section 
8443 of title 5, United States Code) shall be increased by the 
total percent by which the deceased annuitant's annuity was 
increased under paragraph (7). 
(12)(A) If the electing individual is subject to section 8344 of 
title 5, United States Code, at the time of making the election, 
payment of annuity benefits otherwise payable to such individ-
Ante, pp. 589, 
ual Under subchapter III of chapter 83 of such title (and any 
^^i~593. 
related deductions from pay) shall terminate as of the effective 
date of the election. 
(B) Accrued benefits under paragraph (4) for an individual 
described in subparagraph (A) shall be computed— 
(i) in accordance with applicable provisions of subchapter 
III of chapter 83 of title 5, United States Code (but without 
regard to subsection (j) or (k), or the second sentence of 
subsection (e), of section 8339 of such title) using only any 
civilian service under paragraph (IXD), and any military 
service under paragraph (2XB), which would be creditable 
for purposes of computing an annuity under such sub-
chapter; and 
(ii) £is if the individual's reemployment terminated on the 
effective date of the election. 
(b) CHAPTER 83 GENERALLY INAPPUCABLE.—(1) Except as provided 
in subsection (a) or paragraph (2), subchapter III of chapter 83 of 
title 5, United States Code, shall not apply with respect to any 
individual who becomes subject to chapter 84 of title 5, United 
Ante, p. 517. 
States Code, pursuant to an election under section 301. 
(2XA) Nothing in pareigraph (1), or in subchapter III of chapter 83 
of title 5, United States Code, shall preclude the making of a 
deposit under such subchapter with respect to any civilian service 
under subsection (aXlXD) or military service under subsection 
(aX2XB) either by the electing individual or, for purposes of survivor 
annuities, by a survivor of such individual. 
(B) Nothing in paragraph (1) shall preclude the payment of any 
lump-sum credit in accordance with section 8342 of title 5, United 
States Code. 
(c) REFUNDS RELATING TO CERTAIN CIVIUAN SERVICE.—(1) 
Any 
individual who makes an election under section 301 to become 
subject to chapter 84 and who, with respect to any period before the 
effective date of the election, has made a contribution to the Civil 
Service Retirement System (whether by deductions from pay or by a 
deposit or redeposit) and has not taken a refund of the contribution 
(as so made), shall be entitled to a refund equal to— 
(A) for a period of service under clause (i) of subsection 
(a)(lXB), the amount by which— 
(i) the amount contributed with respect to such period, 
exceeds 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 605 
(ii) the amount required under such clause (i) with respect 
to such period; 
(B) for a period of service under clause (ii) of subsection 
(aXlXB), the amount by which— 
(i) the amount so contributed with respect to such period, 
exceeds 
(ii) the amount required under such clause (ii) with re-
spect to such period; and 
(C) for a period of service under subparagraph (C) of subsec-
tion (aXD, the amount by which— 
(i) the amount so contributed with respect to such period, 
exceeds 
(ii) the amount required under such subparagraph with 
respect to such period. 
(2) A refund under this subsection— 
(A) shall be payable with interest, computed at the rate 
applicable for the period involved under section 8331(8XC) of 
title 5, United States Code, but only if such interest would be 
payable pursuant to an application for a lump-sum credit appro-
priately filed under subchapter III of chapter 83 of such title; Ante, pp. 589, 
^nd 
591-593. 
(B) shall be payable upon written application therefor filed 
with the Office of Personnel Management. 
SEC. 303. PROVISIONS RELATING TO AN ELECTION TO BECOME SUBJECT 5 USC 8331 note. 
TO CHAPTER 83 SUBJECT TO CERTAIN OFFSETS RELATING TO 
SOCIAL SECURITY. 
(a) REFUND.—Any individual who makes an election under section 
301(bXlXA) shall, upon written application to the Office of Personnel 
Management, be entitled to a refund equal to— 
(1) for the period beginning on January 1,1984, and ending on 
December 31,1986, the amount by which— 
(A) the total amount deducted from such individual's 
basic pay under section 8334(aXl) of title 5, United States 
Code, for such period, exceeds 
(B) 1.3 percent of such individual's total basic pay for 
such period; and 
(2) for the period beginning on January 1,1987, and ending on 
the day before the effective date of the election, the amount by 
which— 
(A) the total amount deducted from such individual's 
basic pay under such section 8334(aXl) for such period, 
exceeds 
(B) the total amount which would have been deducted if 
such individual's basic pay had instead been subject to 
section 8334(k) of such title during such period. 
(b) DEPOSIT REQUIREMENTS.—(1) In the case of an individual who 
becomes subject to subchapter III of chapter 83 of title 5, United 
States Code, pursuant to notification as described in the second 
sentence of section 301(bX3XB), service performed by such individual 
before the effective date of the notification shall not be considered 
creditable under such subchapter unless— 
(A) for any service during the period beginning on January 1, 
1987, and ending on the day before such effective date, there is 
deposited to the credit of the Fund a percentage of basic pay for 
such period equal to the percentage which would have applied 
100 STAT. 606 
PUBLIC LAW 99-335—JUNE 6, 1986 
under section 8334(k) of such title if such individual's pay had 
been subject to such section during such period; 
(B) for any period of service beginning on January 1, 1984, 
and ending on December 31, 1986, there is deposited to the 
credit of the Fund an amount equal to 1.3 percent of basic pay 
for such period; and 
(C) for any period of service before January 1, 1984, there is 
deposited to the credit of the Fund any amount required with 
respect to such period under such subchapter. 
(2) A deposit under this subsection may be made by the individual 
or, for purposes of survivor annuities, a survivor of such individual. 
SEC. 304. AMENDMENTS RELATING TO SOCIAL SECURITY. 
(a) AMENDMENTS TO SOCIAL SECURITY ACT.—Section 210(a)(5) of the 
42 use 410. 
Social Security Act is amended— 
(1) by striking out "or" at the end of subparagraph (F); 
(2) by striking out the semicolon at the end of subparagraph 
(G) and inserting in lieu thereof ", or"; and 
(3) by adding at the end thereof the following: 
"(H) service performed by an individual on or after the 
effective date of an election by such individual under sec-
tion 301(a) of the Federal Employees' Retirement System 
Act of 1986, or under regulations issued under section 860 of 
Post, p. 619. 
the Foreign Service Act of 1980 or section 307 of the Central 
Intelligence Agency Retirement Act of 1964 for Certain 
Post, p. 628. 
Employees, to become subject to chapter 84 of title 5, 
Ante, p. 517. 
United States Code;". 
(b) AMENDMENTS TO THE INTERNAL REVENUE CODE OF 1954.— 
26 use 3121. 
Section 3121(b)(5) of the Internal Revenue Code of 1954 is amended— 
(1) by striking out "or" at the end of subparagraph (F); 
(2) by striking out the semicolon at the end of subparagraph 
(G) and inserting in lieu thereof ", or"; and 
(3) by adding at the end thereof the following: 
"(H) service performed by an individual on or after the 
effective date of an election by such individual under sec-
tion 301(a) of the Federal Employees' Retirement System 
Act of 1986, or under regulations issued under section 860 of 
the Foreign Service Act of 1980 or section 307 of the Central 
Intelligence Agency Retirement Act of 1964 for Certain 
Employees, to become subject to chapter 84 of title 5, 
United States Code;". 
SEC. 305. EXTENSION OF FEDERAL EMPLOYEES* RETIREMENT CON-
TRIBUTION TEMPORARY ADJUSTMENT ACT OF 1983; REFUND 
OF EXCESS CONTRIBUTIONS. 
(a) EXTENSION.—The Federal Employees' Retirement Contribution 
Temporary Adjustment Act of 1983 (97 Stat. 1106; 5 U.S.C. 8331 
note) is amended— 
(1) in sections 202(6), 203(a)(4)(A), 203(a)(4)(B), 204(a), and 
206(b)(2)(A)(i) by striking "May 1, 1986" each place it appears 
and inserting 
January 1, 1987", and in sections 202(1) and 
206(c)(3) by striking "January 1, 1986" and inserting "Janu-
ary 1,1987"; and 
(2) in subsections (b) and (c) of section 205, by striking out 
"and 1986" and inserting in lieu thereof "1986, and 1987". 
Effective date 
(b) REFUNDS.—(1) The amendments made by subsection (a) shall be 
5 use 8331 note, effective as of May 1,1986. 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 607 
(2) Any refund payable to an individual as a result of paragraph 
(1) shall be paid out of funds of the appropriate retirement system. 
(3) For purposes of this subsection, the term "retirement system" 
means a covered retirement system as defined by section 203(a)(2) of 
the Federal Employees' Retirement Contribution Temporary Adjust-
ment Act of 1983 (97 Stat. 1107; 5 U.S.C. 8331 note). 
SEC. 306. APPLICABILITY TO THE UNITED STATES POSTAL SERVICE. 
Section 1005(d) of title 39, United States Code, is amended to read 
as follows: 
"(d) Officers and employees of the Postal Service (other than the 
Governors) shall be covered by chapters 83 and 84 of title 5. The 
5 use 8301 
Postal Service shall withhold from pay and shall pay into the Civil et seq.; ante, 
Service Retirement and Disability Fund the amounts specified in or 
P ^ '• 
determined under such chapter 83 and subchapter II of such chapter 
84, respectively. The Postal Service shall pay into the Federal 
Retirement Thrift Savings Fund the amounts specified in or deter-
mined under subchapters III and VII of such chapter 84.". 
SEC. 307. USE OF "NORMAL-COST PERCENTAGE". 
5 USC 8401 note. 
Notwithstanding any other provision of law, the normal-cost 
percentage (as defined by section 8401(23) of title 5, United States 
Code, as added by this Act) of the Federal Employees' Retirement 
System shall be used to value the cost of the System for all purposes 
in which the cost of the System is required to be determined by the 
Federal Government, including any comparisons between the cost of 
performing commercial activities under contract with commercial 
sources and the cost of performing those activities using Govern-
ment facilities and personnel. 
SEC. 308. RETIREMENT STUDY. 
(a) STUDY AND PLAN.—The Secretary of Defense and Secretary of 
Transportation shall conduct a study of the retirement systems 
provided for employees of nonappropriated fund instrumentalities of 
the United States under their respective jurisdictions and shall 
develop a feasible plan or plans to provide portability of vested 
retirement benefits among such retirement systems and other Fed-
eral Government retirement systems. 
Ot)) REPORT.—Not later than 90 days after the date of enactment of 
this Act, the Secretary of Defense and Secretary of Transportation 
shall transmit a report to the Congress describing the plan or plans 
developed pursuant to subsection (a) and the anticipated schedule 
for the implementation of such plan or plans. 
SEC. 309. REPEAL OF AUTOMATIC TRANSFER PROVISION. 
Section 207 of the Federal Employees' Retirement Contribution 
Temporary Adjustment Act of 1983 (97 Stat. 1111; 5 U.S.C. 8331 
note) is repealed. 
SEC. 310. DISCLOSURE OF RETURN INFORMATION. 
(a) IN GENERAL.—Subsection (1) of section 6103 of the Internal 
Revenue Code of 1954 (relating to disclosure of returns and return 
26 use 6103. 
information for purposes other than tax administration) is amended 
by adding at the end thereof the following new paragraph: 
"(12) DISCLOSURE OF RETURN INFORMATION TO CARRY OUT FED-
ERAL EMPLOYEES' RETIREMENT SYSTEM.— 
"(A) IN GENERAL.—The Commissioner of Social Security 
shall, on written request, disclose to the Office of Personnel 
100 STAT. 608 
PUBLIC LAW 99-335—JUNE 6, 1986 
5 use 8301 
et seq.; ante, 
p. 517. 
26 use 6103. 
26 use 6103 
note. 
Management return information from returns with respect 
to net earnings from self-employment (as defined in section 
26 use 1402, 
1402), wages (as defined in section 3121(a) or 3401(a)), and 
3121, 3401. 
payments of retirement income, which have been disclosed 
to the Social Security Administration as provided by para-
graph (1) or (5). 
"(B) RESTRICTION ON DISCLOSURE.—The Commissioner of 
Social Security shall disclose return information under 
subparagraph (A) only for purposes of, and to the extent 
necessary in, the administration of chapters 83 and 84 of 
title 5, United States Code." 
(b) CONFORMING AMENDMENTS.— 
(1) Subparagraph (A) of section 6103(pX3) of such Code is 
amended by striking out "(10), or (11)" and inserting in lieu 
thereof "(10), (11), or (12)". 
(2) Paragraph (4) of section 6103(p) of such Code is amended— 
(A) by striking out "(10), or (11)" in the material preced-
ing subpareigraph (A) and inserting in lieu thereof "(10), 
(11), or (12)", and 
(B) by striking out "(10), or (11)" in subparagraph (FXii) 
and inserting in lieu thereof "(10), (11), or (12)". 
(c) REIMBURSEMENT.—The Office of Personnel Management shall 
reimburse the costs (as determined by the Secretary of Health and 
Human Services) of supplying— 
(1) information under section 6103(1)(12) of the Internal Reve-
nue Code of 1954; and 
(2) such other information agreed upon by the Director of the 
Office of Personnel Management and the Secretary of Health 
and Human Services, which is required in the administration of 
chapters 83 and 84 of title 5, United States Code. 
42 use 1306. 
Section 1106 (b) and (c) of the Social Security Act shall apply to any 
reimbursement under this subsection. 
5 use 8472 note. 
SEC. 311. INITIAL APPOINTMENTS TO THE FEDERAL RETIREMENT THRIFT 
INVESTMENT BOARD. 
(a) INITIAL APPOINTMENT OF MEMBERS.—Section 8472(c) of title 5, 
United States Code (as added by section 101(a) of this Act) shall not 
apply to the members of the Federal Retirement Thrift Investment 
Board first appointed to such Board. 
O
t
>
) TERMS OF SERVICE.—Notwithstanding subsection (e)(1) of sec-
tion 8472 of title 5, United States Code (as added by section 101(a) of 
this Act), the term of service of each member of the Federal Retire-
ment Thrift Investment Board appointed pursuant to subsection (a) 
shall be 1 year, except that such member shall continue to serve 
until his successor is appointed under subsection Ot)) of such section 
8472 and confirmed under subsection (c) of such section. 
5 use 8432 note. SEC. 312. PLAN FOR DELAYED CONTRIBUTIONS TO THE THRIFT SAVINGS 
FUND. 
Not later than January 1, 1988, the Executive Director of the 
Federal Retirement Thrift Investment Board shall transmit to Con-
gress a plan to afford employees of the Federal Government and 
Members of Congress who make less than the maximum amount of 
authorized contributions to the Thrift Savings Fund in any period 
an opportunity to contribute to such Fund, in a later period, the 
excess of such amount over the amount contributed during such 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 609 
period. The plan shall include such recommendations for legislation 
as the Executive Director considers appropriate. 
TITLE IV—FOREIGN SERVICE 
RETIREMENT 
SEC. 401. SHORT TITLE; REFERENCES TO FOREIGN SERVICE ACT OF 1980. 
(a) SHORT TITLE.—This title may be cited as the "Foreign Service 
Pension System Act of 1986". 
(b) AMENDMENTS TO FOREIGN SERVICE ACT OF 1980.—Whenever in 
this title a section or other provision is amended, such amendment 
shall be considered to be made to that section or other provision of 
the Foreign Service Act of 1980 (22 U.S.C. 3901 et seq.). 
SEC. 402. REDESIGNATION OF CERTAIN PROVISIONS OF THE FOREIGN 
SERVICE ACT OF 1980. 
(a) CONFORMING CHAPTER AMENDMENTS.—Chapter 8 of title I (22 
U.S.C. 4041 et seq.) is amended— 
(1) by striking out the caption of such chapter and inserting in 
lieu thereof the following: 
"CHAPTER 8—FOREIGN SERVICE RETIREMENT AND DISABIUTY 
Foreign Service 
Pension System 
Act of 1986. 
22 u s e 3901 
note. 
SUBCHAPTER I- -FOREIGN SERVICE RETIREMENT AND DISABILITY 
SYSTEM" 
(2) by striking out "this chapter" each place it appears and 
inserting in lieu thereof "this subchapter"; and 
(3) by inserting "under this subchapter" after "payable from 
the Fund" each place it appears. 
(b) CONFORMING AMENDMENTS RELATING TO RETIREMENT FOR 
DISABIUTY OR INCAPACITY.—(1) Section 808(d) (22 U.S.C. 4048(d)) is 
amended— 
(A) by striking out "such subchapter" each place it appears in 
the second and third sentences and inserting in lieu thereof 
"subchapter I of such chapter 8"; and 
(B) by striking out "Act" each place it appears and inserting 
in lieu thereof "subchapter". 
(2) Section 808(e) (22 U.S.C. 4048(e)) is amended by striking out 
"Act" each place it appears and inserting in lieu thereof "sub-
chapter". 
(c) CONFORMING AMENDMENTS RELATING TO DEATH IN SERVICE.— 
Section 809(a) (22 U.S.C. 4049(a)) is amended by striking out "Act" 
and inserting in lieu thereof "subchapter". 
SEC. 403. DEFINITION OF COURT. 
Section 804(3) (22 U.S.C. 4044(3)) is amended by striking out "or of 
the District of Columbia" and inserting in lieu thereof the following: 
", the District of Columbia, the Commonwealth of Puerto Rico, 
Guam, the Northern Mariana Islands, or the Virgin Islands, and 
any Indian court as defined by section 201(3) of the Act entitled 'An 
Act to prescribe penalties for certain acts of violence or intimida-
tion, and for other purposes', approved April 11, 1968 (25 U.S.C. 
1301(3); 82 Stat. 77)". 
District of 
Columbia. 
Commonwealth 
of Puerto Rico. 
Guam. 
Northern 
Mariana Islands. 
Virgin Islands. 
71_19A 0 - 89 - 22 : QL 3 Parti 
100 STAT. 610 
PUBLIC LAW 99-335—JUNE 6, 1986 
SEC. 404. CREDITABLE SERVICE FOR PURPOSES OF SUBCHAPTERS I AND 
II. 
(a) PRO RATA SHARE.—Section 804(10) (22 U.S.C. 4044(10)) is 
Ante, p. 609; 
amended by inserting "(creditable under subchapter I or II)" after 
post, p. 615. 
"creditable service" each place it appears. 
(b) FORMER SPOUSES.—(1) Section 814(a)(1) (22 U.S.C. 4054(a)(1)) is 
amended by adding at the end thereof the following: "For the 
purposes of this paragraph, the term 'creditable service' means 
service which is creditable under subchapter I or II.". 
(2) Section 81403X1) (22 U.S.C. 4054(b)(1)) is amended by adding at 
the end thereof the following: "For the purposes of this paragraph, 
the term 'creditable service' means service which is creditable under 
subchapter I or II.". 
(c) LUMP-SUM PAYMENTS.—Section 815(i) (22 U.S.C. 4055(i)) is 
amended by adding at the end thereof the following: "For the 
purposes of this subsection, the term 'creditable service' means 
service which is creditable under subchapter I or II.". 
SEC. 405. CONTRIBUTIONS TO THE FOREIGN SERVICE RETIREMENT AND 
DISABILITY SYSTEM. 
(a) CONTRIBUTIONS AFTER DECEMBER 31, 1986.—Section 805 (22 
U.S.C. 4045) is amended— 
(1) by inserting "Except as provided in subsection (h)," before 
"7 percent" in the first sentence of subsection (a); and 
(2) by adding at the end thereof the following new subsection 
(h): 
"(h) Effective with respect to pay periods beginning after Decem-
ber 31, 1986, in administering this section with respect to a partici-
Post, p. 616. 
pant described in section 853(c) whose service is employment for the 
42 use 401. 
purposes of title II of the Social Security Act and chapter 21 of the 
26 use 3101 
Internal Revenue Code of 1954, contributions to the Fund and 
^t seq- 
interest thereon shall be computed as if section 8334(k) of title 5, 
United States Code, were applicable.". 
O
b
) CREDITABILITY OF INTERIM SERVICE.—Subsection (d) of section 
805 (22 U.S.C. 4045(d)) is amended by adding at the end thereof the 
following: 
"(4) Notwithstanding the preceding provisions of this subsection 
and any provision of section 2060t))(3) of the Federal Employees' 
5 use 8331 note. Retirement Contribution Temporary Adjustment Act of 1983, the 
percentage of basic pay required under this subsection in the case of 
a participant described in section 853(c) shall, with respect to any 
5 use 8331 note. Covered service (as defined by section 203(a)(3) of such Act) per-
formed by such individual after December 31, 1983, and before 
January 1,1987, be equal to 1.3 percent.". 
SEC. 406. OFFSET OF ANNUITY BY THE AMOUNT OF SOCIAL SECURITY 
BENEFITS. 
Section 806 (22 U.S.C. 4046) is amended by adding at the end 
thereof the following new subsection: 
"(m) The annuity or survivor annuity payable to any individual 
Supra. 
subject to section 805(h) beginning with the first month for which 
such individual both— 
"(1) attains the minimum age for old-age benefits under title 
42 use 401. 
II of the Social Security Act, and 
"(2) first becomes entitled, or would upon proper application 
become entitled, for disability or survivor benefits under title II 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 611 
of the Social Security Act based on the service of any individual 
42 use 401. 
under this subchapter, 
shall be computed as if section 8349 of title 5, United States Code, Ante, p. 589. 
were applicable.". 
SEC. 407.18-MONTH PERIOD TO ELECT SURVIVOR ANNUITY. 
Section 806 (22 U.S.C. 4046) is further amended by adding at the 
end thereof the following: 
"(n)(l)(A) A participant— 
"(i) who, at the time of retirement, is married; and 
"(ii) who elects at such time (in accordance with subsection 
(b)) to waive a survivor annuity, 
may, during the 18-month period beginning on the date of the 
retirement of such participant, elect to have a reduction under 
subsection (b) made in the annuity of the participant (or in such 
portion thereof as the participant may designate) in order to provide 
a survivor annuity for the spouse of such participant. 
"(B) A participant— 
"(i) who, at the time of retirement, is married, and 
"(ii) who at such time designates (in accordance with subsec-
tion (b)) that a limited portion of the annuity of such participant 
is to be used as the base for a survivor annuity, 
may, during the 18-month period beginning on the date of the 
retirement of such participant, elect to have a greater portion of the 
annuity of such participant so used. 
"(2)(A) An election under subparagraph (A) or (B) of paragraph (1) 
of this subsection shall not be considered effective unless the 
amount specified in subparagraph (B) of this paragraph is deposited 
into the Fund before the expiration of the applicable 18-month 
period under paragraph (1). 
"(B) The amount to be deposited with respect to an election under 
this subsection is an amount equal to the sum of— 
"(i) the additional cost to the System which is associated with 
providing a survivor annuity under subsection (b) of this section 
and results from such election taking into account (I) the dif-
ference (for the period between the date on which the annuity of 
the former participant commences and the date of the election) 
between the amount paid to such former participant under this 
subchapter and the amount which would have been paid if such 
election had been made at the time the participant or former 
participant applied for the annuity, and (II) the costs associated 
with providing the later election; and 
"(ii) interest on the additional cost determined under clause 
(i)(I) of this subparagraph computed using the interest rate 
specified or determined under section 805(dX3) for the calendar 
year in which the amount to be deposited is determined. 
"(3) An election by a participant under this subsection voids 
prospectively any election previously made in the case of such 
participant under subsection (b). 
"(4) An annuity which is reduced in connection with an election 
under this subsection shall be reduced by the same percentage 
reductions as were in effect at the time of the retirement of the 
participant whose annuity is so reduced. 
"(5) Rights and obligations resulting from the election of a reduced 
annuity under this subsection shall be the same as the rights and 
obligations which would have resulted had the participant involved 
elected such annuity at the time of retiring.". 
100 STAT. 612 
PUBLIC LAW 99-335—JUNE 6, 1986 
SEC. 408. ALTERNATE FORMS OF ANNUITIES. 
Section 807 (22 U.S.C. 4047) is amended by adding at the end 
thereof the following: 
Regulations. 
"(e)(1) The Secretary of State shall prescribe regulations under 
which a participant may, at the time of retiring under this sub-
22 use 4048. 
chapter (other than under section 808), elect annuity benefits under 
this section instead of any other benefits under this subchapter 
(including survivor benefits) based on the service of the participant. 
"(2) Subject to paragraph (3), the Secretary of State shall by 
regulation provide for such alternative forms of annuities as the 
Secretary considers appropriate, except that among the alternatives 
offered shall be— 
"(A) an alternative which provides for— 
"(i) payment of the lump-sum credit (excluding interest) 
to the participant; and 
"(ii) payment of an annuity to the participant for life; and 
"(B) in the case of a participant who is married at the time of 
retirement, an alternative which provides for— 
"(i) payment of the lump-sum credit (excluding interest) 
to the participant; and 
"(ii) payment of an annuity to the participant for life, 
with a survivor annuity payable for the life of a surviving 
spouse. 
"(3) Each alternative provided for under paragraph (2) shall, to 
the extent practicable, be designed such that the total value of the 
benefits provided under such alternative (including any lump-sum 
credit) is actuarially equivalent to the value of the annuity which 
would otherwise be provided the participant under this subchapter, 
22 use 4046. 
as Computed under section 806(a). 
"(4) A participant who, at the time of retiring under this sub-
chapter— 
"(A) is married, shall be ineligible to make an election under 
this section unless a waiver is made under section 806(b)(1)(B); 
or 
"(B) has a former spouse, shall be ineligible to make an 
election under this section if the former spouse is entitled to 
benefits under this subchapter (based on the service of the 
participant) unless a waiver has been made under section 
806(b)(1)(C). 
"(5) A participant who is married at the time of retiring under 
this subchapter and who makes an election under this section may, 
during the 18-month period beginning on the date of retirement, 
make the election provided for under section 806(n), subject to the 
deposit requirement thereunder. 
"(6) Notwithstanding any other provision of law, any lump-sum 
credit provided pursuant to an election under this subsection shall 
not preclude an individual from receiving any other benefits under 
this subsection.". 
SEC. 
4
0
9
. 
TREATMENT 
OF 
CERTAIN 
RECALL 
SERVICE. 
Section 823 (22 U.S.C. 4063) is amended by adding at the end 
thereof the following: 
"(c) If an annuitant becomes subject to subchapter II of this 
Post, p. 615. 
chapter by reason of recall service— 
"(1) subsections (a) and (b) shall not apply to such annuitant; 
and 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 613 
"(2) section 824 shall apply to the recall service as if such 
service were reemployment.". 
SEC. 410. REEMPLOYMENT. 
Section 824 (22 U.S.C. 4064) is amended to read as follows: 
"SEC. 824. REEMPLOYMENT.—(a)(1)(A) Except in the case of an 
annuitant who makes an election under subsection O
t
>
)
, if any former 
participant, who has retired and is receiving an annuity under this 
subchapter or subchapter II of this chapter, becomes employed in an Post, p. 615. 
appointive or elective position in the Government, payment of any 
annuity under either subchapter to the annuitant shall terminate 
effective on the date of the employment and the reemployment 
service shall be covered service under the rules of the system under 
which the appointment is made. 
"(B) If the annuity of an individual is terminated under subpara-
graph (A) and that individual becomes covered under the same 
retirement system from which that annuity is terminated, that 
individual shall be entitled to a redetermination of rights under that 
system upon termination of the employment. 
"(C) If the annuity is terminated and the individual becomes 
covered under another contributory retirement system for Govern-
ment employees pursuant to paragraph (A), the individual shall be 
entitled to benefits under the rules of that system. In addition, the 
individual shall be entitled to a resumption of any annuity termi-
nated by reason of the employment. 
"(b)(1) A participant who is entitled to an annuity under this 
subchapter or subchapter II of this chapter and becomes employed 
in an appointive or elective position in the Government on a part-
time, intermittent, or temporary basis may elect to continue to 
receive either or both annuities as provided in this subsection. 
"(2) The total annuity payable under this chapter to an annuitant 
making an election under paragraph (1) shall be reduced during the 
part-time, intermittent, or temporary employment referred to in 
paragraph (1) as necessary to meet the requirements of paragraph 
(3). 
"(3) The sum of— 
"(A) the total annuity payable under this chapter to an 
annuitant making an election under paragraph (1), and 
"(B) the annual rate of pay payable to the annuitant during 
the part-time, intermittent, or temporary employment referred 
to in paragraph (1), 
may not exceed, in any calendar year, the highest annual rate of pay 
which is payable during such year for full-time employment in the 
position in which the annuitant is employed. 
"(4) Upon termination of the part-time, intermittent, or tem-
porary employment referred to in paragraph (1), payment of the full 
annuity of an annuitant who has made an election under paragraph 
(1) of this subsection shall resume. 
"(c) The amount of annuity which has been terminated or reduced 
under this section by reason of the reemployment of the annuitant 
and is resumed under this section shall be the amount of the 
annuity which would have been payable if the annuitant had not 
accepted the reemployment. The amount of an annuity resulting 
from a redetermination of rights pursuant to subsection (a) shall not 
be less than the amount of an annuity resumed under the previous 
sentence. 
100 STAT. 614 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(d) The annuity rights of any participant who is reemployed in 
the Government shall be determined under this section instead of 
section 8468 of title 5, United States Code. 
"(e) When any such retired participant is reemployed, the em-
ployer shall send a notice of such reemplojmaent to the Secretary of 
State, together with all pertinent information relating to such 
employment, and shall pay directly to such participant the salary of 
the position in which he or she is serving. 
"(f) In the event of any overpajrment under this section, such 
overpayment shall be recovered by withholding the amount involved 
from the salary payable to such reemployed participant or from any 
other moneys, including annuity payments, payable under this 
chapter.". 
SEC. 411. COMPARABILITY 
BETWEEN 
THE 
FEDERAL 
EMPLOYEES' 
RETIREMENT SYSTEM AND THE FOREIGN SERVICE PENSION 
SYSTEM. 
Section 827 (22 U.S.C. 4067) is amended by adding at the end 
thereof the following: 
President o
f U.S. 
"(c) The President shall maintain, under the same conditions and 
in the same manner as provided in subsections (a) and (b) existing 
conformity between the Federal Employees' Retirement System 
provided in chapter 84 of title 5, United States Code, and the 
Ante, p. 517. 
Foreign Service Pension System provided in subchapter II of this 
chapter.". 
SEC. 412. MODERATION OF REMARRIAGE PENALTY. 
Chapter 8 of title I (22 U.S.C. 4041 et seq.) is further amended by 
adding after section 827 the following: 
22 use 4068. 
"SEC. 828. REMARRIAGE.—NotwitlStanding any other provision of 
this subchapter, any benefit payable under this subchapter to a 
surviving spouse, former spouse, or surviving former spouse that 
would otherwise terminate or be lost if the individual remarried 
before 60 years of age, shall not terminate or be lost if the re-
marriage occurred on or after November 8,1984, and the individual 
was 55 years of age or over on the date of the remarriage.". 
SEC. 413. LUMP-SUM PAYMENTS. 
22 use 4055. 
Subsection (a) of section 815 is amended by adding at the end 
thereof the following: "A participant who becomes subject to sub-
Post, p. 615. 
chapter II shall be entitled to payment of the lump-sum credit if, 
and to the extent that, such lump-sum credit relates to service of a 
type described in clauses (i) through (iii) of section 802(a)(lXC) of the 
Federal Employees' Retirement System Act of 1986.". 
SEC. 414. EXCLUSION OF PARTICIPANTS IN FOREIGN SERVICE PENSION 
SYSTEM FROM FOREIGN SERVICE RETIREMENT AND DISABIL-
ITY SYSTEM. 
22 use 4043. 
Section 803 is amended— 
(1) in subsection (a), by striking out "The" and inserting in 
lieu thereof "Except as provided in subsection (d), the"; and 
(2) by adding at the end thereof the following: 
"(d) An individual subject to the Foreign Service Pension System 
(described in subchapter II) is not a participant in this System.". 
SEC. 415. FOREIGN SERVICE PENSION SYSTEM. 
Chapter 8 of title I (22 U.S.C. 4041 et seq.) is further amended by 
adding at the end thereof the following: 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 615 
"SUBCHAPTER II—FOREIGN SERVICE PENSION SYSTEM 
"SEC. 851. ESTABUSHMENT.—(a) There is hereby established a 
22 use 4071. 
Foreign Service Pension System. 
"(b) Except as otherwise specificEilly provided in this subchapter or 
any other provision of law, the provisions of chapter 84 of title 5, 
United States Code, shall apply to all participants in the Foreign 
Ante, p. 517. 
Service Pension System and such participants shall be treated in all 
respects similar to persons whose participation in the Federal 
Employees' Retirement System provided in that chapter is required. 
"SEC. 852. DEFINITIONS.—As used in this subchapter, unless other- 
22 use 407 
la. 
wise specified— 
"(1) the term 'court order' h£is the same meaning given in 
section 804(4); 
22 use 4044. 
"(2) the term 'Fund' means the Foreign Service Retirement 
and Disability Fund maintained by the Secretary of the Treeis-
ury pursuant to section 802; 
"(3) the term 'normal cost' means the entry-age normal cost of 
the provisions of the System which relate to the Fund, com-
puted by the Secretary of State in accordance with generally 
accepted actuarial practice and standards (using dynamic 
assumptions) and expressed as a level percentage of aggregate 
basic pay; 
"(4) the term 'participant' means a person who participates in 
the Foreign Service Pension System; 
"(5) the term 'pro rata share' in the case of any former spouse 
of any participant or former participant means the percentage 
which is equal to the percentage that (A) the number of years 
during which the former spouse was married to the participant 
during the service of the participant which is creditable under 
this chapter is of (B) the total number of years of such service, 
disregarding extra credit under section 817; 
"(6) the term 'supplemental liability' means the estimated 
excess of— 
"(A) the actuarial present value of all future benefits 
payable from the Fund under this subchapter based on the 
service of participants or former participants, over 
"(B) the sum of— 
"(i) the actuarial present value of (I) deductions to be 
withheld from the future basic pay of participants 
pursuant to section 856 and (II) contributions for p£ist 
civilian and military service; 
"(ii) the actuarial present value of future contribu-
tions to be made pursuant to section 857; 
"(iii) the Fund balance as of the date the supple-
mental liability is determined, to the extent that such 
balance is attributable— 
"(I) to the System, or 
"(II) to the contributions made under the Federal 
Employees' Retirement Contribution Temporary 
Adjustment Act of 1983 (5 U.S.C. 8331 note); and 
"(iv) any other appropriate amount, as determined by 
the Secretary of State in accordance with generally 
accepted actuarial practices and principles; and 
"(7) the term 'System' means the Foreign Service Pension 
System. 
100 STAT. 616 
PUBLIC LAW 99-335—JUNE 6, 1986 
22 use 4071b. 
42 use 401. 
26 use 3101 
et seq. 
Ante, p. 614. 
Ante, pp. 589, 
591-593. 
5 use 403 note. 
22 use 3946. 
22 use 4071c. 
5 use 8331 note. 
5 use 403 note. 
"SEC. 853. PARTICIPANTS.—(a) Except for persons excluded by 
subsection (b), (c), or (d), all members of the Foreign Service, any of 
whose service after December 31, 1983, is employment for the 
purpose of title II of the Social Security Act and chapter 21 of the 
Internal Revenue Code of 1954, who would, but for this section, be 
participants in the Foreign Service Retirement and Disability 
System pursuant to section 803 shall instead be participants in the 
Foreign Service Pension System. 
"Ot)) Members of the Service who were participants in the Foreign 
Service Retirement and Disability System on or before December 31, 
1983, and who have not had a break in service in excess of one year 
since that date, are not made participants in the System by this 
section, without regard to whether they are subject to title II of the 
Social Security Act. 
"(c) Individuals who become members of the Service after having 
completed at least 5 years of civilian service creditable under sub-
chapter I, subchapter III of chapter 83 of title 5, United States Code 
(the Civil Service Retirement System), or title II of the Central 
Intelligence Agency Retirement Act of 1964 for Certain Employees 
(determined without regard to any deposit or redeposit requirement 
under any such subchapter or title, any requirement that the 
individual become subject to such subchapter or title after perform-
ing the service involved, or any requirement that the individual give 
notice in writing to the official by whom such individual is paid of 
such individual s desire to become subject to such subchapter or 
title) are not participants in the System, except to the extent 
provided for under title III of the Federal Employees' Retirement 
System Act of 1986 pursuant to an election under such title to 
become subject to this subchapter (under regulations issued by the 
Secretary of State pursuant to section 860), 
"(d) The Secretary may exclude from the operation of this sub-
chapter any member of the Foreign Service, or group of members, 
whose employment is temporary or intermittent, except a member 
whose employment is part-time career appointment or career can-
didate appointment under section 306. 
"SEC. 854. CREDITABLE SERVICE.—(a) For purposes of this sub-
chapter, creditable service of a participant includes— 
"(1) service as a participant after December 31,1986; 
"(2) 
service 
with 
respect 
to 
which 
deductions 
and 
withholdings under section 204(a)(2) of the Federal Employees' 
Retirement Contribution Temporary Adjustment Act of 1983 
have been made; and 
"(3) except as provided in subsection (b), any civilian service 
performed before January 1, 1989 (other than service under 
paragraph (1) or (2)), which, but for the amendment made by 
section 414 of the Federal Employees' Retirement System Act of 
1986, would be creditable under subchapter I (determined with-
out regard to any deposit or redeposit requirement under such 
subchapter, subchapter III of chapter 83 of title 5, United States 
Code (the Civil Service Retirement System), or title II of the 
Central Intelligence Agency Retirement Act of 1964 for Certain 
Employees, any requirement that the individual become subject 
to such subchapter or title after performing the service in-
volved, or any requirement that the individual give notice in 
writing to the official by whom such individual is paid of such 
individual's desire to become subject to such subchapter or 
title). 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 617 
"(bXD A participant who has received a refund of retirenient 
deductions under subchapter I with respect to any service described 
in subsection (aX3) may not be allowed credit for such service under 
this subchapter unless such participant deposits into the Fund an 
amount equal to 1.3 percent of basic pay for such service, with 
interest. 
"(2) A participant may not be allowed credit under this sub-
chapter for any service described in subsection (a)(3) for which 
retirement deductions under subchapter I have not been made, 
unless such participant deposits into the Fund an amount equal to 
1.3 percent of basic pay for such service, with interest. 
"(3) Interest under paragraph (1) or (2) shall be computed in 
accordance with section 805(d) and regulations issued by the Sec-
retary of State. 
"(c) Credit shall be given under this System to a participant for a 
period of prior satisfactory service as— 
"(1) a volunteer or volunteer leader under the Peace Corps 
Act (22 U.S.C. 2501 et seq.), 
"(2) a volunteer under part A of title VIII of the Economic 
Opportunity Act of 1964, or 
"(3) a full-time volunteer for a period of service of at least one 
year's duration under part A, B, or C of title I of the Domestic 
Volunteer Service Act of 1973 (42 U.S.C. 4951 et seq.), 
if the participant makes a payment to the Fund equal to 3 percent of 
pay received for the volunteer service (as determined in accordance 
with regulations of the Secretary of State consistent with regula-
tions for making corresponding determinations under chapter 83, 
title 5, United States Code) together with interest determined under 
regulations issued by the Secretary of State. 
"(d) Credit shall be given under this System to a participant for a 
period of prior service under the Federal Employees' Retirement 
System (described in chapter 84 of title 5, United States Code) or 
under title III of the Central Intelligence Agency Retirement Act of 
1964 for Certain Employees if the participant waives credit under 
the other retirement system and makes a payment to the Fund 
equal to the amount which would have been deducted from pay 
under section 856(a) had the individual been a participant during 
the prior creditable service under the other retirement system 
together with interest on such amount computed in accordance with 
regulations issued by the Secretary of State. 
SEC. 855. ENTITLEMENT TO ANNUITY.—(a)(1) Any participant may 
be retired under the conditions specified in section 811 and shall be 
retired under the conditions specified in sections 812 and 813 and 
receive benefits under this subchapter. 
"(2) For the purposes of this subsection— 
"(A) the term 'participant', as used in the sections referred to 
in paragraph (1), means a participant in the Foreign Service 
Pension System; and 
"(B) the term 'System', as used in those sections, means the 
Foreign Service Pension System. 
"(b)(1) Any participant who retires voluntarily or mandatorily 
under section 607, 608, 811, 812, or 813 under conditions authorizing 
an immediate annuity for participants in the Foreign Service Retire-
ment and Disability System and who has completed at least 5 years 
of service subject to this chapter shall be entitled to an immediate 
annuity computed under paragraph (2). 
"(2) An annuity under paragraph (1) shall be computed— 
Voluntarism. 
42 use 2991 
and note. 
Post, p. 624. 
22 use 4071d. 
22 use 4051. 
22 use 4052, 
4053. 
22 use 4007, 
4008. 
100 STAT. 618 
PUBLIC LAW 99-335—JUNE 6, 1986 
Espionage. 
22 use 4010. 
22 use 4071e. 
26 use 3101. 
"(A) for all service earned while a participant in this System, 
at the rate stated in section 8415(d) of title 5, United States 
Ante, p. 527. 
Code; and 
"(B) for all service earned while a participant in another 
retirement system creditable under section 854(d), at the rate 
which would have been applicable to the individual had that 
individual remained a participant in the other system; and 
"(C) for all volunteer service creditable under section 854(c), 
at the rate stated in section 8415(a) of title 5, United States 
Code. 
"(c) A participant who is entitled to an immediate annuity under 
subsection OJ) shall be entitled to receive an annuity supplement 
while the annuitant is under 62 years of age. The annuity supple-
ment shall be based on the total creditable service of the annuitant 
and shall be computed in accordance with sections 8421(b) and 8421a 
of title 5, United States Code, as if the participant were a law 
enforcement officer retired under section 8412(d) of such title. 
"(d) Any participant who is separated for cause under section 610 
shall not be entitled to an annuity under this System when the 
Secretary determines that the separation was based in whole or in 
part on disloyalty to the United States. 
"SEC. 856. DEDUCTIONS AND WITHHOLDINGS FROM PAY.—(a) The 
employing agency shall deduct and withhold from basic pay of each 
participant a percentage of basic pay equal to IV2 percent minus the 
percentage then in effect under section 3101(a) of the Internal 
Revenue Code of 1954 (relating to the rate of tax for old age, 
survivors and disability insurance). 
"
O
t
>
) Each participant is deemed to consent and agree to the 
deductions under subsection (a). Notwithstanding any law or regula-
tion affecting the pay of a participant, payment less such deductions 
is a full and complete discharge and acquittance of all claims and 
demands for regular services during the period covered by the 
pa3rment, except the right to any benefits under this subchapter 
based on the service of the participant. 
"(c) Amounts deducted and withheld under this section shall be 
deposited in the Treasury of the United States to the credit of the 
Fund under such procedures as the Comptroller General of the 
United States may prescribe. 
"(d) Under such regulations as the Secretary of State may issue, 
amounts deducted under subsection (a) shall be entered on individ-
ual retirement records. 
22 use 407if. 
"SEC. 857. GOVERNMENT CONTRIBUTIONS.—(a) Each agency employ-
ing any participant shall contribute to the Fund the amount com-
puted in a manner similar to that used under section 8423(a) of title 
5, United States Code, pursuant to determinations of the normal 
cost percentage for the Foreign Service Pension System by the 
Secretary of State. 
"Ot))(l) The Secretary of State shall compute the amount of the 
supplemental liability of the Fund as of the close of each fiscal year 
beginning after September 30,1987. The amount of any such supple-
mental liability shall be amortized in 30 equal annual installments 
with interest computed at the rate used in the most recent valuation 
of the System. 
"(2) At the end of each fiscal year, the Secretary of State shall 
notify the Secretary of the Treasury of the amount of the install-
ment computed under this subsection for such year. 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 619 
"(3) Before closing the accounts for a fiscal year, the Secretary of 
the Treasury shall credit to the Fund, as a Government contribu-
tion, out of any money in the Treasury of the United States not 
otherwise appropriated, the amount under paragraph (2) of this 
subsection for such year. 
"SEC. 858. COST-OF-LIVING ADJUSTMENTS.—Cost-of-living adjust-
ments for annuitants under this System shall be granted under 
procedures in section 8462 of title 5, United States Code, in the same 
manner as such adjustments are made for annuitants referred to in 
subsection (c)(3XB)(ii) of such section. 
"SEC. 859. GENERAL AND ADMINISTRATIVE PROVISIONS.—(a) 
The 
Secretary of State shall administer the Foreign Service Pension 
System except for matters relating to the Thrift Savings Plan 
provided in subchapters III and VII of chapter 84 of title 5, United 
States Code. The Secretary of State shall, with respect to the 
Foreign Service Pension System, perform the functions and exercise 
the authority vested in the Office of Personnel Management or the 
Director of such Office by such chapter 84 and may issue regulations 
for such purposes. 
"(b) Determinations of the Secretary of State under the Foreign 
Service Pension System which, if made by the Office of Personnel 
Management under chapter 84 of title 5, United States Code, or the 
Director of such Office, would be appealable to the Merit Systems 
Protection Board shall, instead, be appealable to the Foreign Service 
Grievance Board, except that determinations of disability for 
participants shall be based upon the standards in section 808 (other 
than the exclusion for vicious habits, intemperance, or willful mis-
conduct) and subject to review in the same manner as under that 
section. 
"(c) At least every 5 years, the Secretary of the Treasury shall 
prepare periodic valuations of the Foreign Service Pension System 
and shall advise the Secretary of State of (1) the normal cost of the 
System, (2) the supplemental liability of the System, and (3) the 
amounts necessary to finance the costs of the System. 
"SEC. 860. TRANSITION PROVISIONS.—The Secretary of State shall 
issue regulations providing for the transition from the Foreign 
Service Retirement and Disability System to the Foreign Service 
Pension System in a manner comparable to the transition of 
employees subject to subchapter III of chapter 83 of title 5, United 
States Code (the Civil Service Retirement System), to the Federal 
Employees' Retirement System. For this and related purposes, ref-
erences made to participation in subchapter III of chapter 83 of title 
5, United States Code (the Civil Service Retirement System), the 
Social Security Act, and the Internal Revenue Code of 1954 shall be 
deemed to refer to participation in the Foreign Service Pension 
System or the Foreign Service Retirement and Disability System, as 
appropriate. 
SEC. 861. FORMER SPOUSES.—(a)(1)(A) Unless otherwise expressly 
provided by any spousal agreement or court order governing disposi-
tion of benefits under this subchapter, a former spouse of a partici-
pant or former participant is entitled, during the period described in 
subparagraph (B), to a share (determined under paragraph (2)) of all 
benefits otherwise payable to such participant under this sub-
chapter if such former spouse was married to the participant for at 
least 10 years during service of the participant which is creditable 
under this chapter with at least 5 of such years occurring while the 
participant was a member of the Foreign Service. 
22 use 4071g. 
22 use 4071h. 
Regulations. 
22 use 40711. 
Ante, pp. 589, 
591-593. 
42 use 1305. 
26 use 1 et seq. 
22 use 4071J. 
100 STAT. 620 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(B) The period referred to in subparagraph (A) is the period 
which begins on the first day of the month following the month in 
which the divorce or annulment becomes final and ends on the last 
day of the month before th§ former spouse dies or remarries before 
55 years of age. 
(2) The share referred to in paragraph (1) equals— 
"(A) 50 percent, if such former spouse w£is married to the 
participant throughout the actual years of service of the partici-
pant which are creditable under this chapter; or 
"(B) a pro rata share of 50 percent, if such former spouse was 
not married to the participant throughout such creditable 
service. 
"(3) A former spouse shall not be qualified for any benefit under 
this subsection if, before the commencement of any benefit, the 
former spouse remarries before becoming 55 years of age. 
26 use 1 et seq. 
"(4)(A) For purposes of the Internal Revenue Code of 1954, pay-
ments to a former spouse under this section shall be treated as 
income to the former spouse and not to the participant. 
"(B) Any reduction in payments to a participant or former partici-
pant as a result of payments to a former spouse under this subsec-
tion shall be disregarded in calculating— 
"(i) the survivor annuity for any spouse, former spouse, or 
other survivor under this subchapter, and 
"(ii) any reduction in the annuity of the participant to provide 
survivor benefits under this subchapter. 
"(5) Notwithstanding subsection (a)(1), in the case of any former 
spouse of a disability annuitant— 
"(A) the annuity of the former spouse shall commence on the 
date the participant would qualify, on the basis of his or her 
creditable service, for an annuity under this chapter (other than 
a disability annuity) or the date the disability annuity begins, 
whichever is later, and 
"(B) the amount of the annuity of the former spouse shall be 
calculated on the basis of the annuity for which the participant 
would otherwise so qualify. 
"(6)(A) Except as provided in subparagraph (B), any former spouse 
who becomes entitled to receive any benefit under this subchapter 
which would otherwise be payable to a participant or former partici-
pant shall be entitled to make any election regarding method of 
payment to such former spouse that such participant would have 
otherwise been entitled to elect, and the participant may elect an 
alternate method for the remaining share of such benefits. Such 
elections shall not increase the actuarial present value of benefits 
expected to be paid under this subchapter. 
"(B) A former spouse may not elect a method of payment under 
Ante, p. 522. 
Subchapter II, chapter 84 of title 5, United States Code, providing for 
pavment of a survivor annuity to any survivor of the former spouse. 
'(7) The maximum amount payable to any former spouse pursu-
ant to this subsection shall be the difference, if any, between 50 
percent of the total benefits authorized to be paid to a former 
participant by this subchapter, disregarding any apportionment of 
these benefits to others, and the aggregate amount payable to all 
others at any one time. 
"(b)(1) Unless otherwise expressly provided for by any spousal 
agreement or court order governing survivorship benefits under this 
subchapter to a former spouse married to a participant or former 
participant for the periods specified in subsection (aXl)(A), such 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 621 
former spouse is entitled to a share, determined under subsection 
(b)(2), of all survivor benefits that would otherwise be payable under 
this subchapter to an eligible surviving spouse of the participant. 
"(2) The share referred to in subsection (b)(1) equals— 
"(A) 100 percent if such former spouse was married to the 
participant throughout the entire period of service of the 
participant which is creditable under this chapter; or 
"(B) a pro rata share of 100 percent if such former spouse was 
not married to the participant throughout such creditable 
service. 
"(c) A participant or former participant may not make any elec-
tion or modification of election under section 8417, 8418, or 8433 of 
title 5, United States Code, or other section relating to the partici-
pant's account in the Thrift Savings Plan or annuity under the basic 
plan that would diminish the entitlement of a former spouse to any 
benefit granted to the former spouse by this section or in a current 
spousal agreement. 
"(d) If a member becomes a participant under this subchapter 
after qualifying for benefits under subchapter I and, at the time of 
transfer, has a former spouse entitled to benefits under subchapter I 
which are determined under section 814 or 815 (as determined by 22 use 4054, 
the Secretary of State) and are similar in amount to a pro rata share ^055. 
division under section 814 or 815 and the service of the member as a 
participant under this subchapter is not recognized in determining 
that pro rata share, then subsections (a) and (b) of this section shall 
not apply to such former spouse. Otherwise, subsections (a) and (b) of 
this section shall apply. 
"(e) If a participant dies after completing at least 18 months of 
service or a former participant dies entitled to a deferred annuity, 
but before becoming eligible to receive the annuity, and such partici-
pant or former participant has left with the Secretary of State a 
spousal agreement promising a share of a survivor annuity under 
subchapter IV, chapter 84, title 5, United States Code, to a former 
spouse, such survivor annuity shall be paid under the terms of this 
subchapter as if the survivor annuity had been ordered by a court. 
"SEC. 862. SPOUSAL AGREEMENTS.—A spousal agreement is any 22USC407ik. 
written agreement (properly authenticated as determined by the 
Secretary of State) between a participant or former participant and 
his or her spouse or former spouse on file with the Secretary of 
State. A spousal agreement shall be consistent with the terms of this 
Act and applicable regulations and, if executed at the time a partici-
pant or former participant is currently married, shall be approved 
by such current spouse. It may be used to fix the level of benefits 
payable under this subchapter to a spouse or former spouse.". 
SEC. 416. TABLE OF CONTENTS. 
The table of contents in section 2 of such Act is amended— 
(1) by striking out the item relating to chapter 8 and inserting 
in lieu thereof the following: 
"CHAPTER 8—FOREIGN SERVICE RETIREMENT AND DISABILITY 
"SUBCHAPTER I—FOREIGN SERVICE RETIREMENT AND DISABILITY SYSTEM"; 
and 
(2) by inserting after the item relating to section 827 the 
following: 
"Sec. 828. Remarriage. 
100 STAT. 622 
PUBLIC LAW 99-335—JUNE 6, 1986 
"SUBCHAPTER II—FOREIGN SERVICE PENSION SYSTEM 
"Sec. 851. Establishment. 
"Sec. 852. Definitions. 
"Sec. 853. Participants. 
"Sec. 854. Creditable service. 
"Sec. 855. Entitlement to annuity. 
"Sec. 856. Reduction and withholdings from pay. 
"Sec. 857. Government contributions. 
"Sec. 858. Cost-of-living adjustments. 
"Sec. 859. General and administrative provisions. 
"Sec. 860. Transition provisions. 
"Sec. 861. Former spouses. 
"Sec. 862. Spousal agreements.". 
22 u s e 4046 
SEC. 417. EFFECTIVE DATE. 
22 use 4022. 
(a) REGULATIONS.—Notwithstanding section 702 of this Act, the 
authority of the Secretary of State to issue regulations under sub-
Ante, p. 615. 
chapter II of title 8 of the Foreign Service Act of 1980 shall take 
effect on the date of enactment of this Act. 
0?) 18-MoNTH PERIOD TO ELECT SURVIVOR ANNUITY.—(1) Notwith-
22 use 4022; 
standing section 702 of this Act, the amendment made by section 407 
ante, p. 611. 
shall take effect 3 months after the date of enactment of this Act. 
(2XA) Subject to subparagraph (B), the amendment made by sec-
tion 407 shall apply with respect to participants and former partici-
pants who retire before, on, or after such amendment first takes 
effect. 
(B) For the purpose of applying the provisions of paragraph (1) of 
section 806(n) of the Foreign Service Act of 1980 (as added by section 
407) to former participants who retire before the date on which the 
amendment first takes effect— 
(i) the period referred to in subparagraph (A) or (B) of such 
paragraph (as the case may be) shall be considered to begin on 
the date on which such amendment first becomes effective; and 
(ii) the amount referred to in paragraph (2) of such section 
806(n) shall be computed without regard to the provisions of 
subparagraph (B)(ii) of such paragraph (relating to interest). 
(3) For purposes of this subsection, the term "participant" has the 
meaning given that term in section 803 of the Foreign Service Act of 
1980 (22 U.S.C. 4043). 
TITLE 
V—CENTRAL 
INTELLIGENCE 
AGENCY RETIREMENT AND RELATED 
MATTERS 
SEC. 
501. 
REFERENCES. 
The Central Intelligence Agency Retirement Act of 1964 for Cer-
tain Employees (78 Stat. 1043; 50 U.S.C. 403 note) is amended— 
(1) in section 201(c), by inserting "(except section 305(d) of this 
Act)" after "or any other provisions of law"; 
(2) by striking out "this Act" each place it appears in title II 
except in sections 201 and 264, and inserting in lieu thereof 
"this title"; and 
(3) by inserting "under this title" after "payable from the 
fund" each place it appears in title II. 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 623 
SEC. 502. CONTRIBUTIONS TO THE CENTRAL INTELLIGENCE AGENCY 
RETIREMENT AND DISABILITY SYSTEM. 
Section 211 of the Central Intelligence Agency Retirement Act of 
1964 for Certain Employees is amended— 
50 USC 403 note. 
(1) by striking out "Seven" in the first sentence of subsection 
(a) and inserting in lieu thereof "Except as provided in subsec-
tion (d), seven"; and 
(2) by adding at the end thereof the following new subsection 
(d): 
"(dXD In the case of a participant who was a participant subject to 
this title before January 1,1984, and whose service— 
"(A) is employment for the purposes of title II of the Social 
Security Act and chapter 21 of the Internal Revenue Code of 42 use 40i. 
1954, and 
26 use 3101 et 
"(B) is not creditable service for any purpose under title III of ^^^ 
this Act or chapter 84 of title 5, United States Code, 
Ante, p. 517. 
there shall be deducted and withheld from the basic pay of the 
participant under this subsection during any pay period only the 
amount computed pursuant to paragraph (2). 
"(2) The amount deducted and withheld from the basic pay of a 
participant during any pay period pursuant to paragraph (1) shall be 
the excess of^ 
"(A) the amount determined by multiplying the percent ap-
plicable to the participant under subsection (a) by the basic pay 
payable to the participant for such pay period, over 
"(B) the amount of the taxes deducted and withheld from such 
basic pay under section 3101(a) of the Internal Revenue Code of 
1954 (relating to old-age, survivors, and disability insurance) for 26 use 3101. 
such pay period.". 
SEC. 503. OFFSET OF ANNUITY BY THE AMOUNT OF SOCIAL SECURITY 
BENEFITS. 
Section 221 of the Central Intelligence Agency Retirement Act of 
1964 for Certain Employees is amended by adding at the end thereof 50 use 403 note. 
the following new subsection: 
"(pXD Notwithstanding any other provision of this title, except as 
provided in paragraph (2), an annuity (including a disability annu-
ity) payable under this title to an individual described in section 
301(cXl) and any survivor annuity payable under this title on the 
basis of the service of such individual shall be reduced in a manner 
consistent with section 8349 of title 5, United States Code, under Ante, p. 589. 
conditions consistent with the conditions prescribed in such section. 
"(2) This section shall not apply with respect to any annuity, or 
survivor annuity, which is based on the service of an individual 
described in section 301(cX2).". 
Post, p. 624. 
SEC. 504. THRIFT SAVINGS FUND PARTICIPATION BY PARTICIPANTS IN 
THE CENTRAL INTELLIGENCE AGENCY RETIREMENT AND 
DISABILITY SYSTEM. 
Part K of title II of the Central Intelligence Agency Retirement 
Act of 1964 for Certain Employees is amended by adding at the end 50 use 403 note. 
thereof the following new section: 
100 STAT. 624 
PUBLIC LAW 99-335—JUNE 6, 1986 
50 u s e 403 note. 
Ante, p. 593. 
Regulations. 
50 u s e 403 note. 
Ante, p. 591. 
Ante, p. 622. 
THRIFT SAVINGS FUND PARTICIPATION BY PARTICIPANTS IN THE 
CENTRAL 
INTELLIGENCE 
AGENCY 
RETIREMENT 
AND 
DISABIUTY 
SYSTEM 
"SEC. 293. (a) Participants in the Central Intelligence Agency 
Retirement and Disability System shall be deemed to be employees 
for the purposes of section 8351 of title 5, United States (Jode. 
"(b) Subsections (k) and (m) of section 8461 of title 5, United States 
Code, shall apply with respect to contributions made by officers and 
employees of the Agency to the Thrift Savings Fund under section 
8351 of such title, and to earnings attributable to the investment of 
such contributions.". 
SEC. 505. ALTERNATIVE FORMS OF ANNUITIES. 
Part K of title II of the Central Intelligence Agency Retirement 
Act of 1964 for Certain Employees (as amended by section 504 of this 
Act) is further amended by adding at the end thereof the following 
new section: 
"ALTERNATIVE FORMS OF ANNUITIES 
"SEC. 294. (a) The Director shall prescribe regulations under 
which an officer or employee of the Agency may, at the time of 
retiring under this title (other than under section 231), elect annuity 
benefits under this section instead of any other benefits under this 
title (including any survivor benefits under this title) based on the 
service of the officer or employee creditable under this title. The 
regulations and alternatives shall, to the maximum extent prac-
ticable, meet the requirements prescribed in section 8343a of title 5, 
United States Code. 
"(b) Notwithstanding any other provision of law, any lump-sum 
credit provided pursuant to an election under subsection (a) shall 
not preclude an individual from receiving other benefits provided 
under such subsection. 
"(c) The Director shall submit the regulations prescribed under 
subsection (a) to the Select Committee on Intelligence of the Senate 
and the Permanent Select Committee on Intelligence of the House 
of Representatives before the regulations take effect.". 
SEC. 506. PARTICIPATION IN THE FEDERAL EMPLOYEES' RETIREMENT 
SYSTEM. 
The Central Intelligence Agency Retirement Act of 1964 for Cer-
tain Employees is amended by adding at the end thereof the 
following: 
"TITLE III—PARTICIPATION IN THE FEDERAL EMPLOYEES' 
RETIREMENT SYSTEM 
50 u s e 403 note. 
42 u s e 401. 
26 u s e 3101 et 
seq.; ante, p. 517. 
APPLICATION OF FEDERAL EMPLOYEES RETIREMENT SYSTEM TO 
AGENCY EMPLOYEES 
"SEC. 301. (a) Except as provided in subsections 0)) and (c), all 
officers and employees of the Agency, any of whose service after 
December 31, 1983, is employment for the purpose of title II of the 
Social Security Act and chapter 21 of the Internal Revenue Code of 
1954, shall be subject to chapter 84 of title 5, United States Code. 
"(b) Participants in the Central Intelligence Agency Retirement 
and Disability System who were participants in such system on or 
before December 31, 1983, and who have not had a break in service 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 625 
in excess of 1 year since that date, are not subject to chapter 84 of 
title 5, United States Code, without regard to whether they are Ante, p. 517. 
subject to title II of the Social Security Act. 
42 use 40i. 
"(c)(1) The provisions of chapter 84 of title 5, United States Code, 
shall not apply with respect to— 
"(A) any individual who separates, or who has separated, 
from Federal Government service after having been an officer 
or employee of the Agency subject to title II of this Act; and 
"(B) any officer or employee of the Agency having at least 5 
years of civilian service which was performed before January 1, 
1987, and is creditable under title II of this Act (determined 
without regard to any deposit or redeposit requirement under 
subchapter III of chapter 83 of title 5, United States Code, or Ante, pp. 589, 
under title II of this Act, or any requirement that the individual 591-593. 
become subject to such subchapter or to title II of this Act after 
performing the service involved). 
"(2) Paragraph (1) shall not apply with respect to an individual 
who h£is elected under regulations prescribed under section 307 of 
this Act to become subject to chapter 84 of title 5, United States Post, p. 628. 
Code, to the extent provided in such regulations. 
"(3) An individual described in paragraph (1) shall be deemed to 
be an individual excluded under section 8402(bX2) of title 5, United 
States Code. 
"(d) The application of the provisions of chapter 84 of title 5, 
United States Code, to officers and employees referred to in subsec-
tion (a) shall be subject to the exceptions and special rules provided 
in this title. Any provision of such chapter which is inconsistent 
with a special rule provided in this title shall not apply to such 
officers and employees. 
"SPECIAL RULES RELATING TO SECTION 203 CRITERIA EMPLOYEES 
"SEC. 302. (a) Except as otherwise provided in this section, in the 50 use 403 note. 
application of chapter 84 of title 5, United States Code, to an officer 
or employee of the Agency who is subject to such chapter and is 
designated by the Director under the criteria prescribed in section 
203, such officer or employee shall be treated for purposes of deter-
mining such officer's or employee's retirement benefits and obliga-
tions under such chapter as if the officer or employee were a law 
enforcement officer (as defined in section 8401(17) of title 5, United 
States Code). 
"Ot)) The provisions of sections 233 and 235 of this Act shall apply 5
0 use 403 note. 
to officers and employees referred to in subsection (a), except that 
the retirement benefits shall be determined under the provisions of 
chapter 84 of title 5, United States Code. 
"(cXD Except as provided in paragraph (2), section 271 of this Act 
shall apply to an officer or employee referred to in subsection (a). 
"(2) Contributions during recall service shall be made as provided 
in section 8422 of title 5, United States Code. 
"(3) When an officer or employee recalled under this subsection 
reverts to a retired status, the annuity of such officer or employee 
shall be redetermined under the provisions of chapter 84 of title 5, 
United States Code. 
100 STAT. 626 
PUBLIC LAW 99-335—JUNE 6, 1986 
"SPECIAL RULES FOR OTHER EMPLOYEES FOR SERVICE ABROAD 
50 use 403 note. 
"SEC. 303. (a) Notwithstanding any provision of chapter 84 of title 
Ante, p. 517. 
5, United States Code, the annuity under subchapter II of such 
chapter of a retired officer or employee of the Agency who is not 
designated under section 302(a) of this Act and has served abroad as 
an officer or employee of the Agency shall be computed as provided 
in subsection 0)). 
"0)X1) The portion of the annuity relating to service abroad 
performed on or after the effective date of the Federal Employees' 
Retirement System Act of 1986 shall be computed as provided in 
section 8415(d) of title 5, United States Code. 
"(2) The portions of the annuity relating to other service in the 
Agency shall be computed as provided in the provision of section 
8415 of such title that is applicable to such service under the 
conditions prescribed in chapter 84 of such title. 
"SPECIAL RULES FOR FORMER SPOUSES 
50 use 403 note. 
"SEC. 304, (a) Section 8445 of title 5, United States Code, and 
subsections (d) and (e) of section 8435 of such title shall not apply in 
the case of an officer or employee of the Agency who is subject to 
chapter 84 of title 5, United States Code, and who has a former 
50 use 403 note, spouse (as defined in section 204(b)(4) of this Act). Any reference in 
such chapter to a survivor annuity for a former spouse, as applied to 
such officer or employee, shall be deemed to refer to a survivor 
annuity for a former spouse of such officer or employee provided 
under subsection (c) of this section. 
"(b) Section 221(b)(lXC) of this Act shall apply to a survivor 
annuity under subsection (cX2) of this section. 
"(c) Except as otherwise provided in this section, the following 
provisions of title II of this Act shall apply in the case of an officer 
or employee of the Agency who is entitled to receive an annuity 
under subchapter II, III, or V of chapter 84 of title 5, United States 
Code, in the same manner as such provisions apply in the case of an 
officer or employee of the Agency under title II: 
"(1) Section 222, except that subsections O
t
>
) and (c) of such 
section shall be subject to a waiver under subsection (b) of this 
section. 
"(2) Subsections (a), (bXD, and (bX3) of section 223 and the first 
sentence of subsection (c) of such section. 
"(3) Subsections (c) and (d) of section 234 (in the case of any 
lump-sum payment under section 8424(a) of title 5, United 
States Code, and any payment under subsection (b)(3), (b)(4), 
(cX3), (cX4), or (d) of section 8433 of such title). 
"(4) Section 2630t)). 
"(d) In the application of section 222(a) under subsection (c)(1)— 
"(1) the reference in paragraph (4XB) of such section to section 
271, 272, or 273 of this Act shall be deemed to refer to any 
similar provision of law applicable to such officer or employee 
for purposes of chapter 84 of title 5, United States Code; 
"(2) the amount of the reduction in the salary of a recalled or 
reinstated officer or employee under such paragraph (4)(B) shall 
be only the amount by which the annuity under subchapter II 
or V of chapter 84 of title 5, United States Code, would have 
been reduced; and 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 627 
"(3) amounts to be deposited in the Treasury of the United 
States pursuant to such paragraph (4XB) shall be credited to the 
Civil Service Retirement and Disability Fund. 
"(e) In the application of subsections (b) and (c) of section 222 50 use 403 note. 
under subsection (c)(2)— 
"(1) the percentage prescribed in subsections (b)(lXA), (b)(lXB), 
(bX4XA), and (cX2) of such section shall be deemed to be 50 
percent; 
"(2) for the purpose of computing the amount of the former 
spouse's annuity under subsection (bXD of such section and the 
maximum amount of survivor annuities under subsection (bX4) 
or (c)(2) of such section, the full amount of the deceased officer's 
or employee's annuity— 
"(A) in the case of an annuity under subchapter II or V of 
chapter 84 of title 5, United States Code, is the amount of Ante, pp. 517, 
such annuity computed without regard to the reduction for ^^^• 
survivor annuities; and 
"(B) in the case of an annuity under subchapter III of 
such chapter, is the amount of such annuity computed on 
an actuarial basis as provided in such subchapter taking 
into account the application of section 222(bXl) in the case 
of such annuity; 
"(3) an election under subsection (bX5XB) of such section shall 
apply with respect to a survivor annuity for a spouse under 
section 8442 of title 5, United States Code; 
"(4) the reference in subsection (cX2) of such section to a 
survivor annuity for a spouse shall be deemed to refer— 
"(A) in the case of an annuity under subchapter II or V of 
chapter 84 of title 5, United States Code, to the survivor 
annuity provided in section 8442 of title 5, United States 
Code; and 
"(B) in the case of an annuity under subchapter III of 
such chapter, to the survivor annuity described in section 
8435(c) of such title; and 
"(5) the fund referred to in subsections (cX3XA) and (cX3XB) of 
such section shall be deemed to refer— 
"(A) in the case of an annuity under subchapter II or V of 
chapter 84 of title 5, United States Code, to the Civil Service 
Retirement and Disability Fund; and 
"(B) in the case of an annuity under subchapter III of 
such chapter, the Thrift Savings Fund established by sec-
tion 8437 of such title. 
"(f) A reduction in the annuity of an officer or employee of the 
Agency to provide a survivor annuity or survivor annuities under 
this section shall be computed as provided in section 8419(a) of 
title 5, United States Code. 
"(g) The entitlement of a former spouse to a portion of an annuity 
of a retired officer or employee of the Agency under this section 
shall extend to any supplementary annuity payment that such 
officer or employee is entitled to receive under section 8421 of title 5, 
United States Code. 
"ADMINISTRATIVE PROVISIONS 
"SEC. 305. (a) Section 201(c) of this Act shall apply in the adminis- 50 use 403 note. 
tration of chapter 84 of title 5, United States Code, with respect to 
officers and employees of the Agency. 
100 STAT. 628 
PUBLIC LAW 99-335—JUNE 6, 1986 
"(b) Notwithstanding subsection (a), section 8461(e) of title 5, 
United States Code, shall apply with respect to officers and employ-
ees of the Agency who are not participants in the Central Intel-
ligence Agency Retirement and Disability System and are not 
Ante, p. 625. 
designated under section 302(a) of this Act. 
"REGULATIONS 
50 use 403 note. 
"SEC. 306. (a) The Director, in consultation with the Director of 
the Office of Personnel Management and the Executive Director of 
the Federal Retirement Thrift Investment Board, shall prescribe in 
regulations appropriate procedures to carry out this title. 
"
O
t
>
) The Director shall submit the regulations prescribed under 
subsection (a) to the Select Committee on Intelligence of the Senate 
and the Permanent Select Committee on Intelligence of the House 
of Representatives before the regulations take effect. 
"TRANSITION PROVISIONS 
Regulations. 
"SEC. 307. (a) The Director shall issue regulations providing for 
50 use 403 note, the transition from the Central Intelligence Agency Retirement and 
Disability System to the Federal Employees' Retirement System 
Ante, p. 517. 
provided in chapter 84 of title 5, United States Code, in a manner 
consistent with sections 301 through 304 of the Federal Employees' 
Retirement System Act of 1986. 
"(b) The Director shall submit the regulations prescribed under 
subsection (a) to the Select Committee on Intelligence of the Senate 
and the Permanent Select Committee on Intelligence of the House 
of Representatives before the regulations take effect.". 
SEC. 507. SPECIAL RETIREMENT ACCRUAL FOR OTHER INTELLIGENCE 
PERSONNEL. 
(a) CERTAIN NATIONAL SECURITY AGENCY PERSONNEL.—Section 
9(b)(1)(B) of the National Security Agency Act of 1959 (50 U.S.C. 402 
note) is amended by inserting before the semicolon the following: 
"(including special retirement accrual in the same manner provided 
in section 303 of the Central Intelligence Agency Retirement Act of 
Ante, p. 626. 
1964 for Certain Employees (50 U.S.C. 403 note))'\ 
(b) CERTAIN DEFENSE INTELLIGENCE AGENCY PERSONNEL.—Section 
1605(a) of title 10, United States Code, is amended by adding at the 
end thereof the following: "The Secretary may also provide to any 
such civilian personnel who are subject to chapter 84 of title 5, 
special retirement accrual benefits in the same manner provided for 
certain officers and employees of the Central Intelligence Agency in 
section 303 of the Central Intelligence Agency Retirement Act of 
Ante, p. 626. 
1964 for Certain Employees (50 U.S.C. 403 note).". 
TITLE VI—MISCELLANEOUS PROVISIONS 
SEC. 601. ANNUITIES FOR SURVIVORS OF DISTRICT OF COLUMBIA JUDGES. 
(a) AMENDMENTS TO DISTRICT OF COLUMBIA CODE.—(1) Subsections 
(a) and (b) of section 11-1567 of title 11 of the District of Columbia 
Code are each amended by striking out "3 per centum" each place it 
appears and inserting in lieu thereof "3.5 percent". 
(2)(A) Subsection (a) of section 11-1568 of title 11 of the District of 
Columbia Code is amended by striking out "computing a survivor 
PUBLIC LAW 99-335—JUNE 6, 1986 
100 STAT. 629 
annuity" and inserting in lieu thereof "any provision of this sub-
chapter which refers to this subsection". 
(B) Subsection (c) of section 11-1568 of title 11 of the District of 
Columbia Code is amended— 
(i) in paragraph (2XB), by striking out "the lesser of (i) $2,700 
per year divided by the number of such children or (ii) $900" 
and inserting in lieu thereof "the lesser of (i) $8,424 per year 
divided by the number of such children or (ii) $2,808"; 
(ii) in paragraph (3), by striking out "the lesser of (A) $3,240 
per year divided by the number of children or (B) $1,080" and 
inserting in lieu thereof "the lesser of (A) $10,110 per year 
divided by the number of such children or (B) $3,370"; 
(iii) by inserting before the first sentence of the matter follow-
ing paragraph (3) the following: 
"For the purpose of computing, under this subsection, the annuity of 
a child that commences on or after January 1, 1987, the figures 
$8,424, $2,808, $10,110, and $3,370 (provided in paragraphs (2) and 
(3)) shall be increased by the total percentage of the increases 
allowed and in force with respect to retirement salaries of judges 
under section ll-1571(a) of this title on or after such date.'; and 
(iv) in the first sentence of the matter following paragraph (3) 
by striking out "remarriage" and inserting in lieu thereof 
"upon remarriage prior to the attainment of fifty-five years of 
age". 
(C) Subsection (e) of section 11-1568 of title 11 of the District of 
Columbia Code is amended to read as follows: 
"(e) The annuity of a widow or widower of a judge or retired judge 
who elected a survivor annuity shall be equal to— 
"(1) in the case of a judge who dies while in active regular 
service as a judge, the greater of— 
"(A) 55 percent of the retirement salary the judge would 
have been entitled to receive (as computed under section 
11-1564) if the judge had retired on the day before the date 
of death (without regard to the age requirements prescribed 
in section ll-1562(b)), or 
"(B) 55 percent of the retirement salary the judge would 
have been entitled to receive (as computed under section 
11-1564) if the judge had retired on the day before the date 
of death with 15 years of service for the purposes of this 
subchapter (without regard to the age requirements pre-
scribed in section ll-1562(b)); and 
"(2) in the case of a retired judge, 55 percent of the retirement 
salary payable to such judge on the day before the date of the 
judge's death.", 
(b) APPUCATION OF AMENDMENTS.—The benefits conferred by sec-
tion 11-1568 of title 11 of the District of Columbia Code, by reason of 
the amendments made by subsection (a) shall apply to individuals 
eligible for annuities under such sections on or after the date of the 
enactment of this Act, except that— 
(1) such annuities shall be computed in accordance with the 
provisions of such section, as amended by subsection (a), not-
withstanding contributions or deposits made in accordance with 
applicable law at lower rates; and 
(2) no additional liability shall be created with respect to 
deposits made in accordance with applicable law before the date 
of the enactment of this Act, or after such date pursuant to an 
100 STAT. 630 
PUBLIC LAW 99-335—JUNE 6, 1986 
installment payment election made under section ll-1567(b) of 
title 11 of the District of Columbia Code, before such date. 
(c) OPPORTUNITY TO REVOKE A PREVIOUS SURVIVOR ANNUITY ELEC-
TION.—(IXA) Any individual who, before the date of the enactment 
of this Act, made an election under section 11-1566 of title 11 of the 
District of Columbia Code, to come within the purview of the 
survivor annuity provisions of subchapter III of chapter 15 of such 
title may revoke that election. Such a revocation shall constitute a 
complete withdrawal from the survivor annuity program provided 
for in such subchapter. 
(B) A revocation under subparagraph (A) shall be submitted in 
writing to the Mayor of the District of Columbia. 
(2) A revocation under paragraph (1) shall be effective on the day 
it is received by the official referred to in subparagraph (B) of such 
paragraph. 
(8XA) On the effective date of a revocation under paragraph (1), 
any right to survivor benefits (to which the revocation relates) for 
the survivors of the individual who makes the revocation shall 
terminate, and all amounts credited to the account of such individ-
ual under section ll-1570(c) of title 11 of the District of Columbia 
Code, together with interest computed as provided in subparagraph 
(B), shall be returned to that individual in a lump-sum payment. 
(B) For the purpose of subparagraph (A), interest shall be com-
puted in accordance with section 11-1561(10X0 of title 11 of the 
District of Columbia Code. 
(4XA) Any individual who makes a revocation under paragraph (1) 
and who thereafter becomes eligible to make an election under 
section 11-1556 of title 11 of the District of Columbia Code, may 
make such election only if such individual redeposits, to the credit of 
the District of Columbia Judge's Retirement Fund referred to in 
section 11-1561(4) of such title, the full amount of the lump-sum 
payment made to such individual under paragraph (4), together with 
interest. 
(B) For the purpose of subparagraph (A), interest shall be com-
puted at 3 percent per annum, compounded on December 31 of each 
year from the date of the lump-sum payment referred to in such 
subparagraph until the date on which the amount referred to in 
such subparagraph is redeposited under such subparagraph. 
(d) ADDITIONAL OPPORTUNITY TO MAKE A SURVIVOR ANNUITY ELEC-
TION.—(1) Any individual who, on or before the date of the enact-
ment of this Act, has not made an election under section ll-1566(a) 
of title 11 of the District of Columbia Code, to come within the 
purview of the survivor annuity provisions of subchapter III of 
chapter 15 of such title and is no longer entitled to make such an 
election may make such an election. Any such election shall be 
submitted in writing to the Mayor of the District of Columbia. 
(2) An election under paragraph (1) shall be effective on the day it 
is received by the official referred to in such paragraph. 
(e) PERIOD FOR EXERCISE OF RIGHT TO REVOKE OR ELECT.—The right 
to revoke an election under subsection (d) or to make an election 
under subsection (e) is irrevocably waived if not exercised within 180 
days after the date of the enactment of this Act. 
PUBLIC LAW 99-335—JUNE 6, 1986 
TITLE VII—AUTHORIZATION OF 
APPROPRIATIONS; EFFECTIVE DATES 
100 STAT. 631 
SEC. 701. AUTHORIZATION OF APPROPRIATIONS FOR CERTAIN EXPENSES 
5 USC 8472 note. 
OF 
THE 
FEDERAL 
RETIREMENT 
THRIFT 
INVESTMENT 
MANAGEMENT SYSTEM. 
(a) TEMPORARY ALTERNATIVE FUNDING.—Notwithstanding section 
8484(c)(3) of title 5, United States Code (as added by section 101 of 
this Act), the expenses incurred in the administration of the Federal 
Retirement Thrift Investment Management System under sub-
chapter VII of chapter 84 of such title (as so added) during fiscal 
Ante, p. 577. 
years 1986 and 1987 shall be paid from sums appropriated pursuant 
to subsection Ot)). 
(b) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to 
be appropriated to the Federal Retirement Thrift Investment Board, 
for ftscal years 1986 and 1987, such sums as may be necessary to pay 
the expenses incurred in the administration of the Federal Retire-
ment Thrift Investment Management System during such fiscal 
years. 
SEC. 702. EFFECTIVE DATES. 
(a) IN GENERAL.—Except as provided in subsection (b), this Act 
and the amendments made by this Act shall take effect on 
January 1,1987. 
(b) EXCEPTIONS.—(1) Subchapter VII of chapter 84 of title 5, United 
States Code, as added by section 101 of this Act, shall take effect on 
the date of the enactment of this Act. 
(2) Except as provided in section 305 of this Act, title III of this 
Act, and the amendments made by such title, shall take effect on the 
date of the enactment of this Act. 
(3) The amendments made by sections 204 and 205 of this Act shall 
take effect on the date of the enactment of this Act. 
(4) Section 701 of this Act shall take effect on the date of the 
enactment of this Act. 
(5) Sections 505 and 601 of this Act and the amendments made by 
such section 601 shall take effect on the date of the enactment of 
this Act. 
(c) FIRST COST-OF-LIVING ADJUSTMENT.—(1) For purposes of 
the 
first adjustment under subsection (b) of section 8462 of title 5, 
United States Code (as added by section 101 of this Act), the base 
quarter ending on September 30, 1986, shall be considered to have 
been the base quarter for a year in which an adjustment under such 
subsection was made. 
5 USC 8401 note. 
100 STAT. 632 
PUBLIC LAW 99-335—JUNE 6, 1986 
(2) As used in paragraph (1), the term "base quarter" has the 
meaning provided by section 8462(a)(1) of title 5, United States Code 
(as added by section 101 of this Act). 
Approved June 6, 1986. 
LEGISLATIVE HISTORY—H.R. 2672 (S. 1527): 
HOUSE REPORTS: No. 99-606 (Comm. on Conference). 
SENATE REPORTS: No. 99-166 accompanying S. 1527 (Comm. on Governmental 
Affairs) and No. 99-302 (Comm. of Conference). 
CONGRESSIONAL RECORD: 
Vol. 131 (1985): July 8, considered and passed House. 
Nov. 7, considered and passed Senate, amended, in lieu of S. 
1527. 
Vol. 132 (1986): May 20, Senate agreed to conference report. 
May 22, House agreed to conference report. 
WEEKLY COMPILATION OF PRESIDENTIAL DOCUMENTS, Vol. 22 (1986): 
June 6, Presidential statement.