An Act to amend the Railroad Retirement Act of 1937 and the Railroad Retirement Tax Act, and for other purposes
PL 89-699 (H.R.17285), enacted 10/30/1966

80 STAT. ] 
PUBLIC LAW 89-699-OCT. 30, 1966 
1073 
States Capitol Grounds known as Square 732 in the District of Co-
lumbia, bounded by Independence Avenue, S.E., Second Street, S.E., 
C Street, S.E., and First Street, S.E., and intersected by Carroll 
Street, for such period of time as said land is not required for building 
or other purposes by the Architect of the Capitol. 
Approved October 29, 1966. 
Public Law 89-699 
A N A C T 
October 30, 1966 
To amend the Railroad Retirement Act of 1937 and the Railroad Retirement 
[H. R. 17285] 
Tax Act, and for other purposes. 
Be it enacted hy the Senate and House of Representatives 
of the 
United States of America in Congress assembled^ That— 
Railroad Retire-
ment Act of 1937 
and Railroad Re-
TITLE I—AMENDMENTS TO T H E RAILEOAD EETIRE- '"^'"-"t Tax Act, 
MENT ACT OF 1987 TO PROVIDE 
SUPPLEMENTAL 
ANNUITIES 
SECTION 1. Section 3 of the Railroad Retirement Act of 1937 is 7 2^stftr\'779°' 
amended by adding at the end thereof the following new subsection: 
45 use 228c. 
"SUPPLEMENTAL ANNUITIES 
"(j) (1) An individual who is entitled to the payment of an annuity 
under section 2 of this Act (other than subsection (e) or (h) thereof) 73^|ta\!*'26^^' 
and had a current connection w^ith the railroad industry at the time 
45 use 228b. 
such annuity began to accrue, shall be entitled to have a supplemental 
annuity accrue to him for each month beginning with the month in 
which he has (i) attained the age of sixty-five and (ii) completed 
twenty-five or more years of service. The amount of the supplemental 
annuity shall be $45 plus an additional amount of $5 for each year of 
service that the individual has in excess of 25 years, but in no case 
shall the supplemental annuity exceed $70: Provided^ however^ That 
in cases where an individual's annuity under section 2 of this Act be-
gins to accrue on other than the first day of the month, the amount 
of any supplemental annuity to which he is entitled for that month 
shall be reduced by one-thirtieth for each day with respect to which he 
is not entitled to an annuity under section 2. The supplemental an-
nuity provided by this subsection shall, with respect to any month, be 
subject to the same provisions of subsection (d) of section 2 of this 
Act as the individual's annuity under such section 2. Except as pro-
vided in subsection (a) (2) of this section, the supplemental annuity 
^°^'' P- ^°^^-
provided by this subsection shall not be taken into consideration in 
determining or computing any other annuity or benefit under this Act. 
"(2) The supplemental annuity provided by this subsection for an 
individual shall, with respect to any month, be reduced by the amount 
of the supplemental pension, attributable to the employer's contribu-
tion, that such individual is entitled to receive for that month under 
any other supplemental pension plan: Provided^ hoioever^ That the 
maximum of such reduction shall be equal to the amount of the supple-
mental annuity less any amount by which the supplemental pension is 
reduced by reason of the supplemental annuity. 
"(3) The supplemental annuity provided by this subsection shall 
terminate with such annuity accruing for the sixtieth month following 
enactment of this subsection. 
"(4) The provisions of section 12 of this Act shall not operate to -^s use 228^ 
exclude the supplemental annuities herein provided for from income 
1074 
PUBLIC LAW 89-699-OCT. 30, 1966 
[80 STAT. 
taxable pui-suant to the Federal income tax provisions of the Internal 
Revenue Code of 1954." 
45 use liL 
^^^' ^- (^) Section 15 of the Railroad Retirement Act of 1937 is 
amended by inserting after subsection (a) the following: 
u 
RAILROAD RETIREMENT SUPPLEMENTAL 
ACCOUNT 
"(b) There is hereby created an account in the Treasury of the 
United States to be known as the Railroad Retirement Supplemental 
Account. There is hereby appropriated to the Railroad Retirement 
Supplemental Account, for the fiscal year ending June 30, 1967, and 
for each fiscal year thereafter, out of any moneys in the Treasury 
not otherwise appropriated, to provide for the payment of supple-
mental annuities in accordance with the provisions of section 3(j) 
Ante, p. 1073. 
^-f ^j^jg ^^.^^ ^j^^ f^j. cxpeuses uccessary for the Board in the adminis-
tration of such section 3(j) as may be specifically authorized annual-
ly in Appropriation Acts, for crediting to such Supplemental Ac-
count, an amount equal to amounts covered into the Treasury (minus 
refunds) during the fiscal year ending June 30, 1967, and during 
each fiscal year thereafter, under sections 3211(b) and 3221(c) of 
Post, p. 1078. 
tjjg Railroad Retirement Tax Act. 
"At the end of forty-eight months following the enactment of the 
Act establishing the Railroad Retirement Supplemental Account 
the Railroad Retirement Board, having surveyed the progress of such 
Account, shall make a determination of whether the balance in such 
Account together with the anticipated income to the Account for the 
next succeeding twelve months will be sufficient to provide for the 
payment of the supplemental annuities provided for in section 3(j) 
(1) of this Act. 
In the event that such determination is that such 
balance and such anticipated income will not be sufficient to provide 
for the payment of all such supplemental annuities in the amounts 
specified, the Railroad Retirement Board is hereby authorized and 
directed to readjust the amounts of all such supplemental annuities, 
proportionately, so that such balance and anticipated income will be 
sufficient to provide for payment of all the supplemental annuities 
as so readjusted for the next succeeding twelve months." 
(b) Section 15 of such Act is further amended by redesignating 
subsections (b), (c), and (d) as subsections (c), (d),and (e), respec-
tively ; by striking out the word "Account" where it first appears in 
subsection (c) as redesignated and inserting in lieu thereof "Rail-
road Retirement Account and the Railroad Retirement Supplemental 
Account (hereinafter jointly referred to as 'Accounts' or 'Railroad 
Retirement Accounts')"; by striking out "Account" each time it ap-
pears elsewhere in such redesignated subsections and inserting in lieu 
thereof "Accounts". 
Effective date. 
gj,^, 3 ^j^) rpj^g amendment made by section 1 of this title shall be 
effective with respect to individuals whose annuities under section 2 
45 use 228b. 
of the Railroad Retirement Act of 1937 are first awarded on or after 
July 1, 1966, provided that no supplemental annuity shall accrue for 
months before the calendar month following the month in which this 
Act is enacted: Provided, 
however, That if before July 1, 1966, an 
annuity was awarded to an individual under section 2(a) 4 or 5 of the 
60 Stat. 727. 
Railroad Retirement Act of 1937, and such individual had recovered 
from disability and returned to the service of an employer before July 
1, 1966, following which he was awarded an annuity after June 30, 
1966, the annuity last awarded him shall be deemed to be an annuity 
first awarded within the meaning of this subsection but only if he 
would have a current connection with the railroad industry at the 
time the annuity last awarded begins to accrue, disregarding his 
earlier entitlement to an annuity. 
77 Stat. 220. 
80 STAT. ] 
PUBLIC LAW 89-699-OCT. 30, 1966 
1075 
(b) The Kailroad Retirement Board is authorized to request the f^^ds"^^^*^ °^ 
Secretary of the Treasury to transfer from the Railroad Retirement 
Account to the credit of the Railroad Retirement Supplemental Ac-
count such moneys as the Board estimates would be necessary for the 
payment of the Supplemental annuities, provided for in section 3(j) 
of the Railroad Retirement Act of 1937, for the six months next fol- 
^"^^' P- I°^^-
lowing enactment of this Act, and for administrative expenses neces-
sary in the administration of such section 3(j) (which expenses are 
hereby authorized) until such time as an appropriation for such ex-
penses is made pursuant to section 15(b) of such Act, and the Secre- 
'^'^' ^
* ^°^'*" 
tary shall make such transfer. The Railroad Retirement Board shall 
request the Secretary of the Treasury at any time before the expira-
tion of one year following the enactment of this Act, to retransfer 
from the Railroad Retirement Supplemental Account to the credit of 
the Railroad Retirement Account the amount transferred to the Rail-
road Retirement Supplemental Account pursuant to the next preced-
ing sentence, plus interest at a rate equal to the average rate of in-
terest borne by all special obligations held by the Railroad Retire-
ment Account on the last day of the fiscal year ending on June 30, 
1966, rounded to the nearest multiple of one-eighth of 1 per centum, 
and the Secretary shall make such retransfer. 
TITLE II—AMENDMENTS TO T H E RAILROAD RETIRE-
MENT ACT OF 1937 TO PROVIDE AN INCREASE IN CER-
TAIN ANNUITIES UNDER THE ACT 
SEC. 201. (a)(1) Section 2(e) of the Railroad Retirement Act of .^spouse's annu-
1937 is amended by striking out the period at the end thereof and in- 
es stat. 683; 
serting in lieu thereof the following: ": And provided further^ That '^^4|'usc^2*28b 
the spouse's annuity provided for herein and in subsection (h) of 
this section shall be computed without regard to the reduction in the 
^^ stat. 26. 
individual's annuity under the first two provisos in section 3(a)(1) 
of this Act and without regard to the effect of section 3(a) (2) on the 
annuity of the individual from whom such spouse's annuity derives.". 
(2) Section 2 of such Act is further amended by adding a new sub-
section at the end thereof as follows: 
"(i) The spouse's annuity provided under subsections (e) and (h) 
of this section shall (before any reduction on account of age) be re-
duced in accordance with the first two provisos in section 3(a) (1) of 
this Act except that the spouse's annuity shall not be less than it would 
be had this Act not been amended in 1966." 
(b) Section 3(a) of such Act is amended by striking out all that 
computation of 
^ ^ 
1 
• 
1 • 
• 
• ! • 
1 
j
!
i
p
n
' 
annuities. 
appeairs therein and inserting in lieu thereof the lollowmg: 
so stat. 310. 
"SEC. 3. (a) (1) The annuity shall be computed by multiplying an 
"
^
^ ^sc 228c. 
individual's 'years of service' by the following percentages of his 
'monthly compensation': 3.58 per centum of the first $50; 2.69 per 
centum of the next $100; 1.79 per centum of the next $300; and 1.67 
per centum of the remainder up to an amount equal to one-twelfth 
of the current maximum annual taxable 'wages' as defined in section 
3121 of the Internal Revenue Code of 1954: Provided^ however^ That 
in cases where an individual is entitled to a benefit under title II of 
the Social Security Act, the amount so computed shall be reduced 
^'^ ^^^ '*°^-
by 6.55 per centum of the amount of such social security benefit (dis-
regarding any increases in such benefit based on recomputations other 
than for the correction of errors after such reduction is first applied 
and any increases derived from changes in the primary insurance 
amount through legislation enacted after the Social Security Amend-
ments of 1965) : Provided further^ That in determining social security 
benefit amounts for the purpose of this subsection, if such individual's 
68A Stat. 417. 
26 u s e 3121. 
79 Stat. 286. 
42USC 302note. 
1076 
PUBLIC LAW 89-699-OCT. 30, 1966 
[80 STAT. 
average monthly wage is in excess of $400, only an average monthly 
wage of $400 shall be used : And provided further. That the amount of 
an annuity as computed under this subsection shall not be less than 
it would be had this Act not been amended in 1966. 
"(2) Notwithstanding the provisions of paragraph (1) of this sub-
section, and of subsection (e) of this section, the annuity of an indi-
vidual for a month with respect to which a supplemental annuity under 
Ante, p. 1073. 
subsectlou (j) of this section accrues to him shall be computed or re-
computed under the provisions of this subsection, or of subsection (e) 
of this section, as in effect before their amendment in 1966: Provided, 
however.. That if the application of the preceding provision of this 
paragraph would result in the amount of the annuity, plus the amount 
of a supplemental annuity (after adjustment under subsection (j) (2) 
of this section) payable to an individual for a month being lower than 
the amount which would be payable as an annuity except for such 
preceding provision, the annuity shall be in an amount which together 
with the amount of the supplemental annuity would be no less than the 
amount that would be payable as an annuity but for such preceding 
provision."' 
45 u^sc 2
2
8
^
c
^
.
' 
(c) Sectiou 3(e) of such Act is amended by striking out all that 
precedes the first proviso and inserting in lieu thereof the following: 
"In the case of an individual having a current connection with the rail-
road industry, the minimum annuity payable shall, before any reduc-
es use 2
^
2
8
^
b 
^'^^^ pursuant to section 2(a) (3), be whichever of the following is the 
least: (1) $5.35 multiplied by the number of his years of service; or 
(2) $89.35; or (3) 118 per centum of his monthly compensation except 
that the minimum annuity so determined shall be reduced in accord-
Ante, p. 1075. 
^ricQ, with the first two provisos in subsection (a) (1) of this section, 
but shall not be less than it would be had this Act not been amended in 
1966:". 
45 use 2^28e. 
(d) Sectiou 5(h) of such Act is amended by striking out all that 
appears therein and substituting in lieu thereof the following: 
"MAXIMUM AND MINIMUM ANNUITY TOTALS,—^Whenever according 
to the provisions of this section as to annuities payable for a month 
with respect to the death of an employee, the total annuities is more 
than $38.84 and exceeds either (a) $207.15, or (b) an amount equal to 
(wo and two-thirds times such employee's basic amount, whichever of 
such amounts is the lesser, such total of annuities shall, after any de-
60 Stat. 731. 
ductions under subsection (i)-, be reduced to such lesser amount or to 
$38.84, whichever is greater. Whenever such total of annuities is less 
than $18.14, such total shall, prior to any deductions under subsection 
(i), be increased to $18.14: Provided., however., That the share of any 
individual in an amount so determined shall be reduced in accordance 
with the first two provisions in section 3(a) (1) of this Act except that 
the share of such individual shall not be less than it would be had this 
Act not been amended in 1966." 
"Basic amount." 
^g) Sectiou 5 (1) (10) of such Act is amended— 
(1) by striking out all that appears in subdivision (i) and 
inserting in lieu thereof the following: "for an employee who will 
have been partially insured, or completely insured solely by virtue 
of paragraph (7) (i) or (7)(ii), or both: the sum of (A) 52.4 
per centum of his average monthly remuneration, up to and 
including $75; plus (B) 12.8 per centum of such average monthly 
remuneration exceeding $75 and up to and including $450; plus 
(C) 12 per centum of such average monthly remuneration exceed-
ing $450 and up to and including an amount equal to one-twelfth 
of the current maximum annual taxable 'wages' as defined in sec-
26^usc^*3uV' 
^^^^^ ^^^^ "* ^^^' Infernal Revenue Code of 1954, plus (D) 1 per 
50 Stat. 312. 
45 use 228f. 
80 STAT. ] 
PUBLIC LAW 89-699-OCT. 30, 1966 
1077 
centum of the sum of (A) plus (B) plus (C) multiplied by the 
number of years after 1936 in each of which the compensation, 
wages, or both, paid to him will have been equal to $200 or more; 
if the basic amount thus computed is less than $18.14, it shall be 
increased to $18.14;" and 
(2) by striking out in subdivision (ii) thereof "'49*' wherever 
73 stat. 27. 
it appears and inserting in lieu thereof "52.4'', by striking out in 
such subdivision "12" and inserting in lieu thereof "12.8", by 
striking out in such subdivision "$40.38" and inserting "$43.15", 
by striking out in such subdivision "$30.25" and inserting in lieu 
thereof "$32.37", and by striking out in such subdivision "$16.13" 
and inserting in lieu thereof "$17.26". 
(f) Section 5 of such Act is amended by adding at the end thereof 
^° ^'|^- ^^^^ 
the following new subsection: 
" (m) An annuity payable under this section to an individual, with-
out regard to subsection (h) of this section or the proviso in the first '^"'^' ^' ^^''^• 
paragraph of section 3(e) of this Act, shall be reduced in accordance 
^^ ^sc 2
2
^
8
^
0
. 
with the first two provisos in section 3(a) (1) of this Act except that 
Ante, p. 1075. 
the amount of the annuity shall not be less than it would be had this 
Act not been amended in 1966." 
(g) All pensions under section 6 of the Railroad Retirement Act 
of 1937, all joint and survivor annuities and survivor annuities deriv-
ing from joint and survivor annuities under that Act awarded before 
the month following the month of enactment of this Act, all widows' 
and widowers' insurance annuities which began to accrue before the 
second month following the month of enactment of this Act, and 
which, in accordance with the proviso in section 5(a) or section 5(b) 
of the Railroad Retirement Act of 1937, are payable in the amount 
of a spouse's annuity to which the widow or widower was entitled 
(except those of such insurance annuities which are based on a spouse's 
annuity which was payable in the maximum amount as determined 
in accordance with the provisions of the Social Security Act as 
amended by the Social Security Amendments of 1965), and all annul- 
^ 
ties under the Railroad Retirement Act of 1935 are increased by 7 
49staT.V6V." 
per centum, but such a widow's or widower's annuity in an amount 
"
^
^ ^^^ 215-228 
formerly received as a spouse's annuity shall not be increased to an 
amount above $74.80: Provided, hoioever, That in cases where an 
individual is entitled to a benefit under title II of the Social Security 
Act, the additional amount payable because of this subsection shall 
be reduced by 6.55 per centum of the amount of such social security 
benefit (disregarding any increases in such benefit based on recompu-
tations other than for the correction of errors after such reduction 
is first applied and any increases derived from changes in the primary 
insurance amount through legislation enacted after the Social Secu-
rity Amendments of 1965) : Provided further, That in determining 
social security benefit amounts for the purpose of this subsection, if 
such individual's average monthly wage is in excess of $400, only 
the average monthly wage of $400 shall be used. 
SEC. 202. (a) The amendments made by section 201 of this title 
shall be effective with respect to annuities accruing for months after 
the month in which this Act is enacted, and with respect to pensions 
due in calendar months after the month next following the month in 
which this Act is enacted. 
The amendments made by subsection (e) 
of section 201 of this title shall be effective as to lump-sum benefits 
under section 5(f) (1) of the Railroad Retirement Act of 1937 with 
^^ ^'^'- ^^9 
respect to deaths occurring on or after the date of enactment 
of this Act. 
65 Stat. 685. 
79 Stat. 286. 
42 u s e 302note. 
42 u s e 401. 
Effective date. 
1078 
PUBLIC LAW 89-699-OCT. 30, 1966 
[80 STAT. 
(b) All recertifications required by reason of the amendnients made 
by this title shall be made by the Railroad Retirement Board without 
application therefor. 
TITLE III—AMENDMENTS TO T H E RAILROAD 
RETIREMENT TAX ACT 
79 Stat. 861. 
26 u s e 3201. 
26 u s e 3211. 
79 Stat. 862. 
26 u s e 3221. 
CHANGES IN" TAX RATES 
SEC. 301. (a) Section 3201 of the Internal Revenue Code of 1954 
(relating to rate of tax on employees under the Railroad Retirement 
Tax Act) is amended by striking out "6% percent'' from subdivision 
"(3)" and inserting in lieu thereof "7 percent"; by striking out "7 
percent" from subdivision "(4')" and inserting in lieu thereof "7i/4 
percent"; and by striking out "714 percent" from subdivision "(5)" 
and inserting in lieu thereof "71/^ percent". 
(b) Section 3211 of such Code (relating to rate of tax on employee 
representatives under the Railroad Retirement Tax Act) is amended 
by striking out "131/^ percent" from subdivision "(3)" and inserting 
in lieu thereof "14 percent"; by striking out "14 percent" from sub-
division "(4)" and inserting in lieu thereof "141/^ percent"; and by 
striking out "141/^ percent" from subdivision "(5)" and inserting in 
lieu thereof "15 percent". 
(c) Section 3221(a) of such Code (relating to rate of tax on em-
ployers under the Railroad Retirement Tax Act) is amended bj^ strik-
mg out "6% percent" from subdivision "(3)" and inserting in lieu 
thereof "7 percent" j by striking out "7 percent" from subdivision 
"(4)" and inserting m lieu thereof " 7 ^ percent"; and by striking out 
"71/4 percent" from subdivision "(5)" and inserting in lieu thereof 
"71/^ percent". 
SUPPLEMENTAL TAXES 
(d) Section 3211 of such Code is further amended by inserting 
"(a)" after "SEC. 3211" and by adding at the end thereof the follow-
ing new subsection: 
"(b) In addition to other taxes, there is hereby imposed on the in-
come of each employee representative a tax equal to 2 cents for each 
man-hour for which compensation is paid to him for services rendered 
as an employee representative." 
(e) Section 3221 of such Code is further amended by adding at the 
end thereof the following new subsection: 
"(c) In addition to other taxes, there is hereby imposed on every 
employer an excise tax, with respect to having individuals in his 
employ, equal to 2 cents for each man-hour, for which compensation 
is paid. With respect to daily, weekly, or monthly rates of compensa-
tion such tax shall apply to the number of hours comprehended in 
the rate together with the number of overtime hours for which com-
pensation in addition to the daily, weekly, or monthly rate is paid. 
With respect to compensation paid on a mileage or piecework basis such 
tax shall apply to the number of hours constituting the hourly equiva-
lent of the compensation paid. 
"Each employer of employees whose supplemental annuities are re-
duced pursuant to section 3(j) (2) of the Railroad Retirement Act of 
Ante, p. 1073. 
5^937 shall be allowed as a credit against the tax imposed by this sub-
section an amount equivalent in each month to the aggregate amount 
of reductions in supplemental annuities accruing in such month to 
employees of such employer. If the credit so allowed to such an em-
ployer for any month exceeds the tax liability of such employer accru-
80 STAT. ] 
PUBLIC LAW 89-700-OCT. 30, 1966 
1079 
ing under this subsection in such month, the excess may be carried for-
ward for credit against such taxes accruing in subsequent months but 
the total credit allowed by this paragraph to an employer shall not 
exceed the total of the taxes on such employer imposed by this sub-
section. At the end of each calendar quarter the Railroad Retirement 
Board shall certify to the Secretary of the Treasury with respect to 
each such employer the amount of credit accruing to such employer 
under this paragraph during such quarter and shall notify such em-
ployer as to the amount so certified." 
(f) The amendments made by subsections (d) and (e) of this sec- 
Effective date. 
tion shall be effective with respect to man-hours, for sixty months be-
ginning with the first month following enactment of this Act, for 
which compensation is paid. 
Approved October 30, 1966. 
Public Law 89-700 
AN ACT 
October 30, 1966 
To amend the Railroad. Retirement Act of 1937, the Railroad Unemployment 
[H. R. 14355] 
Insurance Act, and the Railroad Retirement Tax Act to make certain tech-
nical changes, to provide for survivor benefits to children ages eighteen to 
twenty-one, inclusive, and for other purposes. 
Be it enacted hy the Senate and House of Reyresentatives 
of the 
United States of America in Congress assemhled, 
,. Railroad Re-
J 
i) 
^ 
tirement Act of 
1937, Railroad 
TITLE I—AMENDMENTS TO T H E RAILROAD 
ur^empioyment 
_ 
^ 
Insurance Act, 
RETIREMENT ACT 
OF 
1937 
and Railroad Re-
tirement Tax Act, 
SEC. 101. (a) Section 1(e) of the Railroad Retirement Act of 1937 
^"^It^Tz^^, 
is amended by striking out", Alaska, Hawaii,". 
45 use 228a. 
(b) The third sentence of section 1(h) (1) of such Act is amended 
by striking out "subsections (a), (c), and (d) of section 2 and sub-
section (a) of section 5" and inserting in lieu thereof "sections 2 and 
5"; and by striking out "(1)" and "(2)" and inserting in lieu thereof 
" ( i ) " and "(ii)", respectively. 
(c) Section l(q) of such Act is amended by striking out "in 1965" 
79 stat. 4oo. 
and inserting in lieu thereof "from time to time". 
SEC. 102. ^ (a) Section 2(a) of the Railroad Retirement Act of 1937 
^o stat. 728. 
IS amended by striking out from the third sentence of the last para-
graph thereof the phrase "the month" and inserting in lieu thereof the 
following: "the second month following the month . 
45 u s e 228b.