Feds one step closer to an option for easing into retirement

Sen. Max Baucus, D-Mont., proposed the work-retirement hybrid. Sen. Max Baucus, D-Mont., proposed the work-retirement hybrid. J. Scott Applewhite/AP

The Senate on Wednesday passed an overhaul of highway and transportation programs that includes language allowing retirement-eligible federal employees to work part time to help pay for other government programs.

The chamber passed the $109 billion highway bill by a vote of 74-22, putting the ball in the House’s court. Among the more than 20 amendments considered during this week’s marathon voting in the Senate was a provision penned by Sen. Max Baucus, D-Mont., that would use the retirement flex plan to offset costs of economic development aid in rural counties.

Under the Baucus amendment, approved 82-16 last week, part-time employees would receive partial annuities and could earn additional retirement benefits proportional to the amount of time they work. In addition, older employees would be required to mentor younger new hires and help preserve agency knowledge.

Because many federal employees are nearing retirement, part-time work could pad federal coffers since agencies would not have to replace these employees entirely. The Office of Personnel Management included a similar proposal in its fiscal 2013 budget request. Easing older employees into retirement by offering a part-time work program would save the Obama administration $720 million during the next 10 years, according to White House estimates.

The Senate-passed transportation bill also included a provision that would reinstate parity between parking and mass transit subsidies for commuters, including federal employees.

The National Treasury Employees Union praised that provision, noting that encouraging the use of public transportation would cut down on pollution and congestion on the roads. “With gas prices going higher and higher, this makes more sense than ever,” NTEU President Colleen Kelley said in a statement.

Federal employee unions also applauded the Senate for rejecting a bid to extend the civilian pay freeze an additional year. but they opposed the Baucus phased-in retirement provision on principle. “What we really have a problem is using the savings that would come from that proposal to fund yet another program that’s unrelated to federal employees,” AFGE spokesman Tim Kauffman told Government Executive last week.

The most recent highway and transit legislation expires March 31. The bill now goes to the House, which could take up its own version or use the Senate’s. Leadership has acknowledged “internal Republican divisions” over the House’s highway transit offering, H.R. 7, and Speaker John Boehner, R-Ohio, has suggested the House might defer to the Senate’s transit bill.

In its current form, H.R. 7 is more harmful to federal workers than the Senate-passed measure. The most recent version of the House bill includes a proposal to eliminate the Federal Retirement Employees Retirement System annuity supplement and would change the annuity calculation for new federal hires from an average of their three highest salaries to a high-five average. It also would require workers to contribute a total of 1.5 percent more to their pensions over three years, beginning in 2013.

One union representative told Government Executive the pension offsets would be included when the House resumes debate next week. Another union source suggested that if pension provisions were included, the House would lose support from Democrats, whose backing might be needed to pass the rest of the bill.

Stay up-to-date with federal news alerts and analysis — Sign up for GovExec's email newsletters.
FROM OUR SPONSORS
JOIN THE DISCUSSION
Close [ x ] More from GovExec
 
 

Thank you for subscribing to newsletters from GovExec.com.
We think these reports might interest you:

  • Sponsored by G Suite

    Cross-Agency Teamwork, Anytime and Anywhere

    Dan McCrae, director of IT service delivery division, National Oceanic and Atmospheric Administration (NOAA)

    Download
  • Data-Centric Security vs. Database-Level Security

    Database-level encryption had its origins in the 1990s and early 2000s in response to very basic risks which largely revolved around the theft of servers, backup tapes and other physical-layer assets. As noted in Verizon’s 2014, Data Breach Investigations Report (DBIR)1, threats today are far more advanced and dangerous.

    Download
  • Federal IT Applications: Assessing Government's Core Drivers

    In order to better understand the current state of external and internal-facing agency workplace applications, Government Business Council (GBC) and Riverbed undertook an in-depth research study of federal employees. Overall, survey findings indicate that federal IT applications still face a gamut of challenges with regard to quality, reliability, and performance management.

    Download
  • PIV- I And Multifactor Authentication: The Best Defense for Federal Government Contractors

    This white paper explores NIST SP 800-171 and why compliance is critical to federal government contractors, especially those that work with the Department of Defense, as well as how leveraging PIV-I credentialing with multifactor authentication can be used as a defense against cyberattacks

    Download
  • Toward A More Innovative Government

    This research study aims to understand how state and local leaders regard their agency’s innovation efforts and what they are doing to overcome the challenges they face in successfully implementing these efforts.

    Download
  • From Volume to Value: UK’s NHS Digital Provides U.S. Healthcare Agencies A Roadmap For Value-Based Payment Models

    The U.S. healthcare industry is rapidly moving away from traditional fee-for-service models and towards value-based purchasing that reimburses physicians for quality of care in place of frequency of care.

    Download
  • GBC Flash Poll: Is Your Agency Safe?

    Federal leaders weigh in on the state of information security

    Download

When you download a report, your information may be shared with the underwriters of that document.