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OPM Announces a Special FSA Enrollment, and More
A weekly roundup of pay and benefits news.
The Office of Personnel Management on Monday announced that federal employees will be able to enroll in flexible spending accounts for medical expenses and dependent care between now and June 30, implementing provisions of the fiscal 2021 spending package and COVID-19 relief bill passed this spring.
FSAs are accounts that allow employees to set aside money on a pre-tax basis to be spent on child care costs and a variety of out-of-pocket medical expenses such as copays and over-the-counter drugs and other medical supplies. The omnibus spending package passed last December allowed enrollees in FSAs to roll over unused money from 2020 through 2021. Ordinarily, money in FSAs is considered “use it or lose it,” with any unspent money forfeited at the end of a calendar year.
The American Rescue Plan, enacted in March, raised the pretax contribution limits for dependent care FSAs and increased the maximum age of a dependent from 13 to 14.
In a press release, OPM announced that it has launched a Special Open Enrollment period for traditional health care FSAs, Limited Expense Health Care FSAs and Dependent Care FSAs until June 30. Additional details are available at FSAFEDS.com.
Another Bill Targeting TSP Chinese Investments
Sen. Marco Rubio, R-Fla., last week introduced another bill aimed at preventing the agency that administers the federal government’s 401(k)-style retirement savings program from investing participants’ money in securities based in mainland China.
The TSP Fiduciary Security Act (S. 1993) would alter the definition of “fiduciary duty” as it pertains to the Federal Retirement Thrift Investment Board, which administers the Thrift Savings Plan, to include a “duty not to harm the national security of the United States.” It also specifically bars investments in “Communist Chinese military companies,” investments in companies on the Commerce Department’s Entity List, and proxy votes by the TSP’s contractual managers in favor of transactions that would “breach contracts with the federal government” or outsource technologies to China.
The bill marks the latest effort to block the TSP from shifting the index upon which the international (I) fund is based to include investments in emerging markets, all of which include some degree of exposure to China. TSP officials and advocates have consistently argued that the decision, which was delayed after then-President Trump nominated new candidates to replace most of the existing board, was made with participants’ best fiduciary interest in mind, and that national security investment issues should be up to the Treasury Department’s Office of Foreign Assets Control.
Rubio’s latest legislation appears to be a response to those arguments.
“It was incredibly shortsighted and dangerous for the Federal Retirement Thrift Investment Board to attempt to invest American civil servants’ retirement savings in companies that are tools of the Chinese Communist Party,” Rubio said. “But it was also revealing of a serious problem: the board and their friends on Wall Street will get away with using American servicemembers’ own savings to fund threats to U.S. national security if the fiduciary duties binding these money managers only focus on short term financial value. My legislation would update the board’s fiduciary duty to more accurately reflect the interests of the TSP’s beneficiaries, rather than the financial interests of Wall Street.”