Pay & Benefits Watch Pay & Benefits WatchPay & Benefits Watch
Key developments in the world of federal employee benefits: health, pay, and much more.

Will Feds Pay for Student Loans and Highways?

Here we go again.

It’s a few days before major legislation expires, Congress is about to go on recess and federal employees’ benefits hang in the balance. This is familiar territory for those who watch federal pay and benefits issues closely: In the last year and a half, this scenario has played out too many times to count.

This time, it’s the debate over extending the reduced student loan interest rate, which expires July 1, and extending stopgap transportation funding, which expires June 30. To pay for the extensions, it’s possible that one or both measures could include provisions that would increase the amount federal workers contribute to their pensions. Lawmakers are hammering out the details now and expect to seal a deal by the end of this week. Lawmakers reportedly reached a tentative deal on the transportation bill, as of Wednesday afternoon, according to the Associated Press, though nothing is final.

Extending the current federal Stafford student loan interest rate of 3.4 percent for one year would cost about $6 billion. To help pay for that, Republicans have suggested making federal employees in both the Civil Service Retirement System and the Federal Employees Retirement System contribute 0.4 percent more to their pensions in calendar years 2012 through 2015, a total of a 1.2 percent increase over current contribution levels. Democrats have offered their own proposals for funding the measure, which do not specifically affect feds’ retirement benefits. No one in a leadership position, however, has publicly said federal workers’ pensions are off the table as a pay-for.

Remember, the House in May passed a bill that includes a 5 percent pension hike phased in over five years for CSRS and FERS employees. That bill, however, is stalled in the Senate and the White House has said President Obama will veto it if it reaches him.

As for the highway bill, Congress passed a stopgap funding measure to prevent a shutdown of transportation-related activities through the end of June. That bill did not include provisions in the House-approved legislation that require federal employees and members of Congress to pay a total of 1.5 percent more toward their pensions over three years beginning in 2013.

So what are the odds federal retirement benefits will be affected? Capitol Hill aides aren’t saying much of anything at the moment, but it’s likely feds will escape the ax again this time around. The White House, however, supported hiking federal employees’ pension contribution rates in its fiscal 2013 budget proposal, so retirement benefits will continue to be on the table in many major policy debates for the foreseeable future.

SES Hiring Tips

Looking for helpful hints on hiring the best and the brightest senior executives? Agencies and human resources managers can peruse a resume-based “workbook” put together by the Office of Personnel Management and the nonprofit Partnership for Public Service. The tool aims to “provide hiring officials and executive resources staff with a framework, guidance, best practices and templates to improve the hiring of Senior Executive Service employees through more efficient and effective methods,” OPM Director John Berry said in a June 22 memorandum to agencies. Click here to take a look.

Per Diem Rates

The Defense Department on Thursday will publish in the Federal Register revised civilian per diem rates to government workers traveling to Guam and the Northern Mariana Islands, effective July 1. The updated maximum per diem rate for Guam, which includes lodging, meals and incidentals, is $255. There are four revised maximum per diem rates for the Northern Mariana Islands, depending on where you travel. They are: $236 for Rota, $227 for Saipan, $161 for Tinian and $161 for everywhere else.

Kellie Lunney covers federal pay and benefits issues, the budget process and financial management. After starting her career in journalism at Government Executive in 2000, she returned in 2008 after four years at sister publication National Journal writing profiles of influential Washingtonians. In 2006, she received a fellowship at the Ohio State University through the Kiplinger Public Affairs in Journalism program, where she worked on a project that looked at rebuilding affordable housing in Mississippi after Hurricane Katrina. She has appeared on C-SPAN’s Washington Journal, NPR and Feature Story News, where she participated in a weekly radio roundtable on the 2008 presidential campaign. In the late 1990s, she worked at the Housing and Urban Development Department as a career employee. She is a graduate of Colgate University.

Close [ x ] More from GovExec

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

  • Forecasting Cloud's Future

    Conversations with Federal, State, and Local Technology Leaders on Cloud-Driven Digital Transformation

  • The Big Data Campaign Trail

    With everyone so focused on security following recent breaches at federal, state and local government and education institutions, there has been little emphasis on the need for better operations. This report breaks down some of the biggest operational challenges in IT management and provides insight into how agencies and leaders can successfully solve some of the biggest lingering government IT issues.

  • Communicating Innovation in Federal Government

    Federal Government spending on ‘obsolete technology’ continues to increase. Supporting the twin pillars of improved digital service delivery for citizens on the one hand, and the increasingly optimized and flexible working practices for federal employees on the other, are neither easy nor inexpensive tasks. This whitepaper explores how federal agencies can leverage the value of existing agency technology assets while offering IT leaders the ability to implement the kind of employee productivity, citizen service improvements and security demanded by federal oversight.

  • IT Transformation Trends: Flash Storage as a Strategic IT Asset

    MIT Technology Review: Flash Storage As a Strategic IT Asset For the first time in decades, IT leaders now consider all-flash storage as a strategic IT asset. IT has become a new operating model that enables self-service with high performance, density and resiliency. It also offers the self-service agility of the public cloud combined with the security, performance, and cost-effectiveness of a private cloud. Download this MIT Technology Review paper to learn more about how all-flash storage is transforming the data center.

  • Ongoing Efforts in Veterans Health Care Modernization

    This report discusses the current state of veterans health care


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