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Key developments in the world of federal employee benefits: health, pay, and much more.

Pension push

The march is on again to get more Social Security benefits for some federal retirees. The National Association of Retired Federal Employees is drumming up support for legislation that would revise the Government Pension Offset, a provision of Social Security law that reduces retirement checks for Civil Service Retirement System retirees whose spouses earned Social Security benefits. In a Feb. 7 letter, association President Frank Atwater urged President Bush to support a reduction or elimination of the offset. Rep. William Jefferson, D-La., last week introduced a bill (H.R. 664) that would eliminate the offset for federal retirees whose combined government and Social Security retirement checks total less than $1,200. The bill won't help better-off retirees, but opponents of the offset have had a hard time making the case that wealthier pensioners need relief. Federal retirees and employees have been fighting the Government Pension Offset since it became law in 1977. Last year, eyeing budget surpluses and emboldened by other efforts to reform Social Security, offset opponents garnered support for Jefferson's bill (then known as H.R. 1217) from 263 of the 435 members of the House. Maryland Democratic Sen. Barbara Mikulski's companion bill (S. 717) had 21 co-sponsors. So far this year, 110 members of the House have signed back up to support Jefferson's bill. Mikulski has not yet re-introduced the companion bill, but a spokeswoman for the Senator said she will do so within "the next month or two." In the House, Jefferson's bill falls under the jurisdiction of the Ways and Means Subcommittee on Social Security. Unfortunately for offset opponents, full committee chairman Rep. Bill Thomas, R-Calif., and subcommittee chairman Rep. Clay Shaw, R-Fla., did not throw their support behind the bill last year and have not yet done so this year. Senate Finance Committee Chairman Charles Grassley, R-Iowa, whose panel oversees Social Security for the upper chamber, did not co-sponsor Mikulski's bill last year either. If a broader Social Security reform measure gets introduced during the 107th Congress, offset opponents may try to slip a provision into it sometime during the legislative process. The federal retirees association also has its sights on the Windfall Elimination Provision, a Social Security rule that Pay and Benefits Watch will explore in future columns. Overtime for Attorneys About 9,200 Justice Department attorneys have had their fingers crossed since Dec. 20, when U.S. Court of Federal Claims Judge Robert H. Hodges Jr. got the last of the briefs that will help him decide whether Justice owes the attorneys millions of dollars in back overtime pay. Justice contends that the lawyers don't qualify for overtime, while the attorneys say that other federal agencies' lawyers get overtime pay, so Justice lawyers should too. Hodges has two basic options. He can decide to hold a hearing or he can rule up or down. The judge does not have to adhere to any specific timeline, so both sides are in a wait-and-see mode. A Few Overpaid Managers Bad news for a few federal managers: You're overpaid. The managers in question are at grades GM-13, 14 and 15 and classified under the 0558 special rate table, as well as those at grade GM-13 and classified under the 999B-F special rate tables. It turns out that a short-cut method for calculating pay increases overcompensates those managers. Office of Personnel Management Director Henry Romero sent a Feb. 14 memorandum to federal human resources directors that explains how to correct the pay rates. If you think you're affected, check with your human resources office. The New Funds on the Block In 1988, the lonely G Fund was joined by the C Fund and the F Fund on the Thrift Savings Plan playground. Less than three months from now, two more funds will come out to play: the I Fund and the S Fund. The I Fund will invest in international stocks, while the S Fund will invest in small capitalization stocks. The C Fund is the other stock fund, investing in common stocks that track the S&P 500, a major stock market index. The S Fund will track the Wilshire 4500, which measures the performance of stocks that are not included in the S&P 500. The I Fund will track the Morgan Stanley Europe, Australia and Far East (EAFE) index. None of the stock funds had a good year in 2000. The C Fund's value dropped 9.14 percent last year, while the Wilshire 4500 (the S Fund) fell 15.8 percent and the EAFE fell 14.2 percent. In the coming weeks, Pay and Benefits Watch will take a closer look at the new funds.

Brian Friel is founder of One Nation Analytics, an independent research, analytics and consulting firm for the federal market.

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