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A Potential Pay Cut for Some Feds, Expanded Telework and More

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A recently introduced bill in Congress could substantially cut the pay of more than 1,000 federal employees in an already beleaguered agency.

The 2017 CFPB Pay Fairness Act (H.R. 4499), introduced last month by Rep. Sean Duffy, R-Wis., would restrict the pay of Consumer Financial Protection Bureau employees to be in line with the General Schedule. Many employees of the controversial financial watchdog agency make far more than their counterparts elsewhere in government, to stay competitive with the private sector in the market for specialized skill sets.

Duffy said in a statement that the higher pay for CFPB employees is unfair to other feds and to taxpayers.

“The CFPB is dangerously unaccountable to the American people because Democrats intentionally designed it that way,” he said. “As a result, they can act as a bully to small banks and credit unions, push a far-left agenda, and spend lavishly on bureaucrat salaries that are obscenely higher than the vast majority of public servants.”

The measure is the latest in a series of efforts by Republicans to rein in the agency created by the Dodd-Frank Wall Street Reform and Consumer Protection Act enacted during the Obama administration. House appropriations bills would bring CFPB, which is currently funded by the Federal Reserve, under congressional spending procedures, and President Trump last month appointed Office of Management and Budget Director Mick Mulvaney to run the bureau on an acting basis, prompting a political firestorm and court battle.

Sen. Mike Enzi, R-Wyo., introduced the bill in the Senate (S. 2171) and said the measure is a common-sense effort to improve accountability at CFPB.

“The need for Congress to bring accountability to the Consumer Financial Protection Bureau is long overdue and the bureau’s lavish spending on employee salaries is a key example of why,” Enzi said. “There are hundreds of employees at the Consumer Financial Protection Bureau making more than governors, Supreme Court justices and senior White House staff, and Congress lacks the usual constitutional checks to rein in this behavior.”

But Tony Reardon, national president of the National Treasury Employees Union, which represents employees at CFPB, said this measure would severely impair the agency’s ability to recruit and retain employees.

“When Congress created the Consumer Financial Protection Bureau, lawmakers correctly decided that CFPB employees should be compensated just like those employees at other independent financial regulatory agencies,” Reardon said in a statement. “CFPB employees could easily earn significantly more money in the private sector, so keeping salaries competitive is crucial. NTEU opposes H.R. 4499 and S. 2171, which would put CFPB under the General Schedule and significantly harm the agency's ability to recruit and retain the best qualified attorneys, examiners, accountants and other financial experts.”

The House approved by voice vote Tuesday a measure that would extend a pilot program encouraging agencies to expand telework opportunities for federal workers. The bill (H.R. 4171), extends the provisions of the 2010 Telework Enhancement Act for an additional three years until the end of 2020.

The measure, introduced by Reps. Greg Gianforte, R-Mont., and Gerry Connolly, D-Va., was approved by the House Oversight and Government Reform Committee last month. Both lawmakers highlighted the success of the U.S. Patent and Trademark Office’s telework program, which allows some full-time employees to live anywhere in the country.

“With the vast geography of Montana, teleworking makes it easier for the federal government to recruit and employ well-qualified Montanans, as the USPTO has done,” Gianforte said last month. “This program has saved taxpayers tens of millions of dollars and has helped recruit and retain outstanding employees that would otherwise be unavailable if they were required to work out of the USPTO’s office in Alexandria, Va.”

The bill now heads to the Senate for consideration.

As lawmakers continue to negotiate a long-term spending deal to keep the government open beyond Dec. 22, the Treasury Department is already bracing for the next potential crisis: running into the debt limit next spring.

As Eric Katz reported, Treasury Secretary Steven Mnuchin announced this week that he would begin suspending Treasury investments into federal pensions, including the Civil Service Retirement and Disability Fund and the Postal Service Retiree Health Benefits Fund. He also announced that the department will temporarily reduce investments in the Thrift Savings Plan’s government securities (G) fund, the most stable offering in the 401(k)-style retirement savings program.

The Congressional Budget Office estimated that Treasury will run out of extraordinary measures to delay hitting the debt ceiling around late March or early April 2018.

Erich Wagner is a staff correspondent covering pay, benefits and other federal workforce issues. He joined Government Executive in the spring of 2017 after extensive experience writing about state and local issues in Maryland and Virginia, most recently as editor-in-chief of the Alexandria Times. He holds a bachelor's degree in journalism from the University of Maryland.

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