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

Relief for Feds Hitting Overtime Pay Caps, Benefits During a Shutdown and More

The House voted 407-4 Tuesday to approve a bill that would increase the annual overtime pay cap for employees at the Secret Service.

The 2017 Secret Service Recruitment and Retention Act (H.R. 3731), introduced by Reps. John Katko, R-N.Y., and Elijah Cummings, D-Md., would raise the overtime pay cap for Secret Service employees from $160,000 per year to $187,000 for 2017 and 2018. It would also direct the agency to submit a report on its recruitment and retention efforts, including data on attrition, morale issues and strategies to address these challenges.

As early as last August, more than 1,000 Secret Service agents had already reached the cap on the amount of overtime pay they could receive in a year. The agency has struggled to recruit and retain agents in recent years, a problem exacerbated by news of misconduct and President Trump’s frequent travel and large family.

The House Oversight and Government Reform Committee advanced the bill to the House floor in September. At the time, Katko and Cummings said the lower cap on overtime pay hurt the Secret Service’s efforts to address its staffing issues.

“The men and women of the Secret Service...

TSP Participants Are Leaving Money on the Table, Fund Changes, and More

Officials at the federal government’s 401(k)-style retirement savings plan said Tuesday that some employees are actually investing too much of their paychecks, and as a result they’re leaving money on the table.

Geoffrey Nieboer, the Thrift Savings Plan’s chief of business intelligence, told members of the Federal Retirement Thrift Investment Board, which governs the TSP, that every year, several thousand federal workers cease contributing to their accounts because they have hit their annual cap on pre-tax investments.

“There are a group of participants who are contributing a high percentage of their income and are reaching their annual contribution limit well before the end of the year,” he said. “While certainly this is well intentioned, they may not understand that by stopping contributions early, they will no longer receive matching contributions and may actually be losing money.”

The federal government provides an employer match for federal employees on the first 5 percent of their paycheck that they invest in the TSP. Officials said those who wish to invest more should still attempt to only hit that cap at the end of the year, so they can continue to receive the employer match.

“We message this regularly...

Senate Panel Drops TSP Catch-Up Contribution Restrictions, A Blow to Pay Parity, and More

Less than a week after floating the idea that older employees should no longer be able to make extra contributions to their retirement accounts before taxes, that proposal appears to be off the table, for now.

Senate Finance Committee Chairman Orrin Hatch, R-Utah, had filed an amendment to the chamber’s tax reform legislation last week that would restrict so-called “catch-up” contributions for workers aged 50 and above to 401(k), 403(b) and 457(b) retirement accounts and the Thrift Savings Plan to Roth investments, which are taxed before the money is invested. His plan also banned the use of catch-up contributions for employees making at least $500,000 per year.

But when the committee marked up its version of the Tax Cuts and Jobs Act Thursday, those proposals were not included, following outcry from federal retiree and employee groups and the retirement savings industry.

The House approved its version of the Tax Cut and Jobs Act (H.R. 1) Thursday. That legislation similarly does not include any changes to how Americans can make catch-up contributions to their retirement accounts.

Elsewhere on Capitol Hill, the Senate Appropriations Committee released the initial version of its fiscal 2018 financial services and...

Tuition Discounts for Feds, a Tax Reform Update, and More

The Office of Personnel Management announced Wednesday that it has reached agreements with four new colleges and universities to provide discounted tuition for federal employees.

Acting OPM Director Kathleen McGettigan announced in a memo to agencies that her office has secured academic agreements with the Catholic University of America’s Metropolitan School of Professional Studies, Pace University’s iPace Program, Park University and Utica College to provide reduced tuition rates or scholarships to federal employees.

The addition of these four schools brings the total number of institutions participating in OPM’s Federal Academic Alliance up to 15. The program is intended to help federal agencies close skills gaps and provide professional development and retention incentives for federal employees.

The agreement provides reduced tuition for federal workers both on campus and for online courses at Catholic University of America, Park University and Utica College. At Pace University only the online curricula are available to feds.

Additionally, the agreement allows feds’ spouses and dependents to attend Park University and Utica College at a discount.

“This Federal Academic Alliance provides federal government employees and their families with access to opportunities to earn a variety of bachelor and master degrees,” McGettigan said in a...

TSP Hardship Withdrawal Programs Extended, OPM Waives Pay Cap for Disaster Volunteers and More

Officials at the 401(k)-style retirement savings program for federal employees announced Monday that they would extend the deadline for workers and retirees impacted by Hurricane Maria to make withdrawals from their accounts under relaxed rules.

In September, Hurricane Maria struck Puerto Rico as a category 4 hurricane, devastating the island. More than a month later, most residents are still without power and other necessities.

Thrift Savings Plan officials in October announced the program would allow federal workers who work or live in an area impacted by Maria to take hardship withdrawals without incurring a six-month contribution ban. Such withdrawals can also be used to assist an eligible family member who works or lived in an area hit by the storm.

The original deadline for submissions was set for Jan. 24, but with Monday’s extension, federal employees and retirees now have until March 8 to request a hardship withdrawal. The funds must be distributed by March 15.

Officials also announced Monday that the TSP also would extend the relaxed hardship withdrawal rules to federal employees and retirees who were affected by the wildfires in California last month. Any TSP enrollee who lives or works in an area impacted...