It would be nice to retire at age 50 with 20 years of service and full retirement benefits, wouldn't it? Some federal employees, such as air traffic controllers, have that option. But if you think your retirement rules are hard to understand, wait until you explore theirs. To start with, you delve into the 2002 Treasury-Postal appropriations bill, which became law in November. You drop down to Section 640 of the law, which reads: "Section 8335(a) of title 5, United States Code, is amended by striking the period at the end of the first sentence and inserting: `or completes the age and service requirements for an annuity under Section 8336, whichever occurs later.'" You head over to your copy of the U.S. Code and learn that the first sentence of Section 8335(a) says: "An air traffic controller [under the Civil Service Retirement System] shall be separated from the service on the last day of the month in which he becomes 56 years of age." You tack on the phrase included in the 2002 Treasury-Postal bill so the sentence now reads: "An air traffic controller [under the Civil Service Retirement System] shall be separated from the service on the last day of the month in which he becomes 56 years of age or completes the age and service requirements for an annuity under Section 8336, whichever occurs later." You note that the new sentence is effective Nov. 12, 2001, the date President Bush signed the Treasury-Postal bill. You scroll down to Section 8336, which explains that air traffic controllers under the Civil Service Retirement System are eligible for retirement benefits once they have completed at least 20 years of service and are at least 50 years old or once they complete 25 years of service at any age. You then deduce that before the change included in the 2002 Treasury-Postal bill, CSRS air traffic controllers who turned 56 but hadn't completed 20 years of service would have to leave their positions as air traffic controllers. That would have kept them from qualifying for their retirement benefits as air traffic controllers. But now, a CSRS air traffic controller who, say, has only 18 years of service when he turns 56 can stay on for another two years to get full retirement benefits. Checking other sections of the law, you see that air traffic controllers in the Federal Employees Retirement System can also stay past 56 if they haven't completed 20 years of service. Of course, you note elsewhere in the regulation that mandatory retirement at age 56 regardless of years of service never applied to people who were appointed to air traffic control positions by the Transportation Department before May 16, 1972. It also never applied if they were hired as air traffic controllers by the Defense Department before Sept. 12, 1980 or as flight service station specialists before Jan. 1, 1987. And even for air traffic controllers subject to the 56-and-out rule, you discover that they could seek an exemption from the head of the department that would allow them to keep working to age 61. Then you see that the mandatory retirement age of 56 triggered a maximum entry age for air traffic controllers, which is still in effect: 30. That ensures that someone hired at age 30 can complete 25 years of service before hitting the mandatory retirement age. Of course, you also see that the maximum entry age of 30 can be waived if someone has experience as an air traffic controller, such as a contractor at one of the few privatized air traffic control towers in the country or as a military air traffic controller. Hence, the need to change the law so that CSRS air traffic controllers who hit age 56 can keep working until they have enough years of service to qualify for full retirement benefits. Maybe by now you've decided that while it would be nice to retire at age 50 with 20 years of service with full retirement benefits, you're glad you're not an air traffic controller. Be glad you're not a firefighter or police officer either (that's a whole other column). And Then There's the Pay Issue If you did become an air traffic controller, then, in terms of pay, you would definitely want to work for the Federal Aviation Administration, not the Defense Department. Because the National Air Traffic Controllers Association has been able to bargain over pay issues under special bargaining authority at the FAA, the agency's air traffic controllers are making a lot more money these days than civilian air traffic controllers at the Defense Department, whose unions don't have the same bargaining authority. Despite a 5 percent salary increase last year from Defense, the FAA's air traffic controllers make a whopping 75 percent more than their Defense Department counterparts, according to Office of Personnel Management statistics. As of September 2001, the average FAA air traffic controller's salary was $93,640, compared to $53,498 at the Defense Department. Part of that substantial difference could be chalked up to experience-the average FAA controller has six more years of experience than the average Defense controller. But even when you compare controllers with the same levels of experience, the difference in pay is substantial. Defense controllers with 10 to 14 years of experience make an average of $49,878, compared to $90,333 for FAA controllers with 10 to 14 years of experience. Defense controllers with 15 to 19 years of experience make an average of $56,450, compared to $97,383 at the FAA. It's no wonder, then, that the Defense Department had a 14 percent turnover rate among air traffic controllers in 2001 (based on 149 separations from a September 2000 workforce of 1,067), compared to a 2.5 percent turnover rate at FAA (based on 560 separations from a September 2000 workforce of 22,851). In 2000, the Defense Department set up a working group to come up with ways to deal with the air traffic control problem. The group included representatives of the Air Force, Army and Navy-the three services that employ air traffic controllers-and union representatives. Peter Tchirkow, an American Federation of Government Employees pay specialist, said the working group came up with a plan to seek higher special pay rates for air traffic controllers at Defense. To get higher pay rates, the department is documenting its recruitment and retention problems. Defense will submit the documentation to the Office of Personnel Management, which will then decide whether to grant higher pay rates. The working group recommended in an April 2001 report that air traffic controllers should get special rates about 30 percent to 40 percent above standard General Schedule rates. Tchirkow said the union may also seek legislation to raise the pay of air traffic controllers at Defense. Corrections An early version of last week's column incorrectly explained administrative expenses in the Thrift Savings Plan. Here's the correct explanation: Expense ratios for the C, F and G Funds were 6 basis points in 2001. The S and I Funds had expense ratios of 5 basis points for the seven months they existed (they were started up in May). That means that for every $1,000 invested, participants were charged 60 cents for the C, F and G Funds and 50 cents for the S and I Funds. Those expense ratios are well below typical expense ratios in the private sector, according to investment advisors. The column also mentioned the ability to transfer money from previous employers' 401k plans and from individual retirement accounts into the TSP. Only money from so-called "conduit" IRAs can be transferred into the TSP. Conduit IRAs consist of funds rolled over from a retirement plan, not money that you contribute directly. Money in traditional IRAs and Roth IRAs cannot be rolled into the TSP.
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