CIVIL SERVICE RETIREMENT

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP74B00415R000600020007-3
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 17
• Document Creation Date: December 12, 2016
• Document Release Date: August 7, 2001
• Sequence Number: 7
• Publication Date: August 12, 1970
• Content Type: REPORT

Ap~roved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
91ST CONGRESS 1 SENATE
2d Session
I No.,91-1092
CIVIL SERVICE RETIREMENT
AUGUST 12 (legislative day, AUGUST 11), 1970.-Ordered to. be printed
Mr. McGEE, from the Committee on Post Office and Civil Service,
submitted the following
REPORT
[To accompany S. 437]
The Committee on Post Office and Civil Service, to which was
referred the bill (S. 437) to amend chapter 83, title 5, United States
Code, to eliminate the reduction in the annuities of employees or
Members who elected reduced annuities in order to provide a survivor
annuity if predeceased by the person named as survivor and permit a
retired employee or Member to designate a now spouse as survivor if
predeceased by the person named as survivor at the time of retirement
having considered the same, reports favorably thereon with amend-
ments and recommends that the bill as amended do pass.
STATEMENT AND JUSTIFICATION
The Civil Service Retirement Act provides.that when an employee
retires he may elect to take a reduced annuity and provide a lifetime
survivor benefit equal to 55 percent of his reduced annuity for his
spouse in the event he dies before his spouse. The election which the
employee makes at the time of his retirement is irrevocable and the
reduction in annuity continues regardless of whether he or his spouse
dies first. About 65 times out of 100, a male retiree dies before his
wife dies; but more than one-third of the time, a male .retiree will
outlive his wife, and will continue to pay 'a reduction in his annuity
to provide a survivor benefit for which there is, by law, no beneficiary.
The problem of providing adequate income for older citizens is
natiDnal in scope. The committee believes that it is in the best interest
of the Government and the civil service retirement system to amend
existing law to permit a retired Federal employee to designate that
his spouse at the time of his death sliall receive a survivor annuity.
The requirement that the spouse have been married to him at the time
of his retirement should be eliminated.
Calendar No. 1103
REPORT,
48-010-70-1
Approved For Release 2001/11/01 : CIA-RDP74B00415R0 0600020007-3
 Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
2
This recommendation is consistent with previous policy established
by the Congress in regard to survivor annuities. In 1966, Congress
changed the Civil Service Retirement Act to eliminate the termination
of survivor annuity in the case of a spouse who remarried after her
husband's death: and since the enactment of that change, the provision
was made partially retroactive to insure equitable treatment for all
surviving spouses whose remarriage occurred on or after July 18, 1966.
S. 437, as introduced, would have permitted the retired employee
to elect that his annuity be recomputed in the event his spouse died,
thus treating him as though he had not made the election for a survivor
annuity. Then if he subsequently remarried, his second spouse could
become eligible for a survivor annuity when (1) she reaches 60 years
of age, and (2) the retired employee repays to the civil service retire-
ment and disability fund the total amount of money he has received
from the fund as the result of the recornpu.tation of his annuity.
The committee has amended the bill to provide that the election to
designate a surviving spouse to receive a survivor annuity will con-
tinue to be an irrevocable decision. No recomputation may ever be
made; but the retired employee will acquire an absolute right for a
survivor annuity for the spouse to whom he is married at the time of
his death so long as the marriage has lasted at least 2 years or the
spouse is the parent of issue from that marriage.
The requirement for the spouse to attain age 60 has been eliminated.
The requirement that the retired employee repay funds paid him
on account of a recomputation has been eliminated. It is unnecessary
because there will be no recomputation. To permit a recomputation
would be an administrative burden upon the Civil Service Commission
and would not increase the employeeis retirement annuity by very
much; but it would impose upon the retired employee who elected a
recomputation and subsequently remarried an affirmative burden. of
repayment that in the most equitable of cases could be a great
hardship.
A retired Federal worker entitled to an annuity of $3,600 a year
takes a reduction of $90 a year to provide a survivor annuity. If his
spouse dies the day after his retirement And he remarries 5 years later,
he would be required to pay $540 before his second spouse would be
eligible for a survivor annuity. A retiree! living on $3,600 a year would
find it very difficult to repay that large a sum, and thus the socially
desirable goal of protecting older people could easily be thwarted.
In addition, an older retired employee should not be required to
remember to notify the Civil Service ;Commission of his desire to
designate a subsequent spouse to receive a survivor annuity. Admin-
istrative experience in the health insurance program exclusively
applicable to Federal employees who retired before July 1, 1960, has
proved that communication between this older group of citizens and
the bureauracy of the Federal Government is difficult.
The provisions of this liberalization of the retirement program will
be partly retroactive. The opportunity to designate a subsequent
spouse or the opportunity to designate a first spouse (if the marriage
occurs after the retirement of the employee) will be extended to any
emp.oyee or to any retired employee on the active or retirement rolls
on the date of enactment. Thus, an employee who retired 20 years
ago will have the opportunity to designate a subsequent spouse to
Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
 Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
3
receive a survivor annuity even though the provisions of this act were
not enacted until long after his retirement from the Federal service.
The surviving subsequent spouse of a retired Federal employee
whose death occurred before the date of enactment of this act will
not be entitled to any of the benefits of this act.
SURVIVOR ANNUITIES CARVED OUT OF 'SUPPLEMENTAL ANNUITIES
Present law provides that when a retiree is reemployed in Federal
service under conditions not terminating his annuity, his salary is
reduced by the amount of his annuity. While he is considered as being
covered by the retirement law, no deductions are withheld from his
salary during the period of reemployment. If he completes at least
one, but less than 5 years of continuous full-time reemployment
service, he is eligible to receive a supplemental annuity benefit com-
puted upon salary and service during the reemployment period..
When this supplemental annuity provision was added to the Civil
Service Retirement Act in 1956, experience indicated that the reem-
ployment periods of retirees were relatively brief, and that the re-
sulting benefits were not large enough to provide a significant increase
in a spouse's potential survivor rate. The supplemental annuity was,
accordingly, made a single-life benefit.
However, there are instances of a reemployed annuitant working
for an extended period and earning a supplemental annuity large
enough to provide a significant increase in the potential survivor
annuity of his spouse.
While not creating a survivor annuity not previously provided upon
original retirement, section 2 of the reported bill would amend the
law to make the supplemental annuity available to increase the
potential survivor rate of the retiree's spouse. The supplemental
annuity would be reduced by 10 percent and the spouse would be
entitled to an increased survivor benefit equal to 55 percent of the
supplemental benefit. The reduction and the increased survivor an-
nuity would be automatic unless the retiree elected to take the full
single-life benefit.
The committee recognizes the value of service rendered by re-
employed annuitants. In many cases, they are employees whose
agencies request their continued service after reaching optional or
mandatory retirement age. The supplemental annuity was created by
Congress to reward such employees for their service after retirement.
DEPENDENT WIDOWERS
The committee recommends that the Civil Service Retirement Act
be amended to remove the requirement that the husband of a female
employee covered under the civil service retirement system be de-
pendent upon his wife in order to qualify for a survivor annuity.
There is no such requirement in the case of the husband of a retired
female employee, and the female employee of the Government pays
as much for her civil service retirement protection as does any male
employee of the Government. In line with other recommendations in-
suring equal protection and benefits for women under Federal law, the
civil service retirement system should be so amended.
Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
 Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
4
AGENCY VIEWS
Following is a letter from the Honorable Robert E. Hampton,
Chairman of the U.S. Civil Service Commission, on S. 437, expressing
the Commission's views on the bill and recommending enactment of
legislation similar to S. 437 as amended by the committee.
U.S. CIVIL SERVICE COMMISSION.
Hon. GALE W. MCGEE, Washington, D.C., August 7, 1970.
Chairman, Committee on Post Office and Civil Service,
U.S. Senate.
DEAR MR. CHAIRMAN: This is in further reply to your request for
the Commission's views on S. 437, a bill to amend chapter 83, title 5,
United States Code, to eliminate the reduction in the annuities of
employees or Members who elected reduced annuities in order to
provide a survivor annuity if predeceased by the person named as
survivor and permit a retired employee or Member to designate a
new spouse as survivor if predeceased by the person named as survivor
at the time of retirement.
Under the civil service retirement law, the annuity of a retiring
married employee is automatically reduced in order to offset a portion
of the cost of providing survivor benefits for his wife (or her husband),
unless at time of retirement the employee elects in writing to receive
an unreduced single-life annuity. The employee's decision in this
matter is irrevocable; the law does not permit him either to name
another person for the survivor annuity or to change his reduced
survivor annuity to an unreduced single-life annuity should the named
spouse predecease him, or should the marriage relationship upon
which the survivor right was based be dissolved.
S. 437, as we construe it, proposes to add to the survivor annuity
option the proviso that if the named spouse predeceases the retiree-
(1) The retiree's reduced survivor annuity would be recom-
puted, under the law in effect at the time he retired, as though
he had not elected survivor benefits; and
(2) Upon remarriage, the retiree could again elect a reduced
annuity with survivor benefits to his (or her) now spouse. The
survivor benefits to the new spouse would also be computed under
the law in effect when the retiree retired. This election could not
be made, however, until the new spouse attained age 60 and the
aggregate additional amount paid to the retiree as a result of the
recomputation in (1) above had been refunded to the civil service
retirement and disability fund.
The recomputation and reelection process could be repeated as often
as the designated spouse predeceases the retiree and he remarries.
However, it divorce from the designated spouse would not permit the
retiree's annuity to be recomputed, nor could he elect survivor benefits
for his new spouse, should he remarry.
S. 437 would apply to people retired both before and after its =ma.ct-
ment, including people retired whose spouses had died before enact-
ment. In the case of a retiree predeceased by a designated spouse after
enactment, the recomputations in (1) or (2) above would be effective,
respectively, the first day of the month beginning after the spouse's
Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
 Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
5
death or the first day of the month beginning after the new spouse
attains age 60.
Insofar as cost is concerned, enactment of S. 437 would increase the
unfunded liability of the civil service retirement and disability fund
by $1,008.4 million. Under the financing provisions of Public Law
91-93, approved October 20, 1969, this amount would be amortized
in 30 annual installments of approximately $53.1 million. The first
$53.1 million would be payable in fiscal year 1971 if the bill is enacted
before June 30, 1971. The normal cost of providing retirement benefits
would be increased by 0.10 percent from 13.98 percent to 14.08 percent.
The Commission finds no justification for the provision of S. 437
that would eliminate the reduction in the annuity of a retiree who
elected a survivor annuity, if predeceased by the person named as
survivor. The reduction originally was equal to the full actuarial cost
of the survivor protection computed over the lifetime of the retiree,
taking into account that there will be instances where the survivor
benefit will never be payable due to intervening death or divorce of
the named survivor. As shown in the following table, though., this
reduction has been decreased five times so that it now equals only a
fraction of the cost of the survivor protection.
Benefit to spouse named at
Reduction in retiree's annuity retirement
Retired between-
Jan. 1, 1940 to Mar. 31, 1948_____-_____ Full actuarial_______________________ 50 or 100 percent of retiree's
reduced annuity.
Apr. 1, 1948 to Sept. 29, 1949___________ 10 percent, plus % of I percent for 50 percent of retiree's unre-
any years spouse under age 60. duced annuity.
Sept. 30, 1949 to Sept. 30, 1956 --------- 5 percent of 1st $1,500 and 10 percent Do.
of remainder, plus j of 1 percent
for any years spouse under age 60.
Oct. 1, 1956 to Oct. 10, 1962____________ 23 percent of Ist $2,400 and 10 per- 50 percent of the amount used
cent of any added amount used as as survivor base.
base for survivor benefit.
Oct. 11, 1962 to present________________ 23 percent of 1st $3,600 and 10 per- 55 percent of the amount used
cent of any added amount used as as survivor base.
base for survivor benefits.
The Commission finds no justification for restoring a single life
annuity to a retiree whose spouse has predeceased him, but concurs
in principle with the idea of extending the survivor protection to the
new spouse of a retired employee or Member if the retiree's marriage
to the spouse named as survivor at the time of retirement is dissolved.
The socioeconomic need to provide survivor protection for the new
spouse is no less than the need to protect the former spouse. However,
we would suggest certain modifications in the provisions included in
S. 437 that are intended to effect this objective.
As noted above, S. 437 would permit the election of a new spouse
in cases where the designated spouse predeceases the retiree, the new
spouse has attained the age of 60, the aggregate additional amount
paid to the retiree as a result of eliminating the reduction in the
retiree's annuity has been refunded, and the retiree's annuity is once
again reduced.
We believe-
(1) Effective on enactment, the substitution of the new spouse
should be automatic, and without regard to age. If, as we recom-
mend, the . retiree's annuity is (as under present law) continued
Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
 Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
6
In summary, the Commission-
(1) Finds no justification for restoring a single-life annuity
to a retiree whose spouse has predeceased him.
(2) Agrees in principle with the idea of extending the original
survivor-
urvivor election to a new spose,;, but recommends that, in
lieu of the provision in S. 437, survivor protection be automatically
extended to a spouse acquired after retirement where the mar-
riage has lasted at least 2 years or produced a child.
Accordingly with the changes discussed above the Commission
recommends enactment of S. 437.
The recommendations above would increase the unfunded liability
of the civil service retirement fund by $1,077.4 million which would be
at the reduced rate following the death of the spouse initially
designated as the potential recipient of survivor benefits, the
substitution of a new spouse would not necessitate the refund
and reduction contemplated under S. 437. Therefore, the auto-
matic substitution of a new spouse could not adversely affect
the retiree insofar as the amount of his annuity is concerned.
In addition, automatic substitution would simplify administration
and assure the new spouse the same survivor protection that
had been provided the former spouse.
(2) Provision for a spouse acquired after retirement should
be effective when the marriage has lasted at least 2 years or a
child has been born of the marriage. This proposed change is
consistent with the automatic survivor annuity provision, already
in the retirement law, for spouses of deceased employees. Its
purpose is to deter "deathbed" marriages in order to provide
annuity to the new spouse.
(3) The substitution of the new spouse should be permitted
when the former marriage ends because of divorce or annulment,
as well as because of death. The reason why the former marriage
ended has no bearing on the need for providing survivor protec-
tion to a new spouse.
(4) Where a spouse acquired after retirement is, and upon
marrying the retiree remains, entitled to a survivor benefit under
this or another retirement system; for Government employees,
she should he paid an annuity under this provision only if she
elects to take it instead of the survivor benefit she already is
entitled to.
(5) Provision should be made for the protection of a spouse
acquired after retirement by an annuitant who was unmarried
at the time he retired. .
(a) Where an unmarried retiree elected annuity without
survivor benefit, he should be permitted to change his
election within 1 year after his marriage, with a reduction in
his annuity becoming effective on the first of the month fol-
lowing receipt of his election in the Commission;
(b) Where an unmarried retiree elected annuity with a
survivor benefit to a person having an insurable interest in
his life, he should similarly be permitted to change his elec-
tion within 1 year after his marriage, with the reduction in
his annuity on accout of his original election to be recompu ted
under the regular option formula, effective on the first of the
month following receipt of his election in the Commission.
Approved For Release 2001/11/01 : CIA-ROP74B00415R000600020007-3
 Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
7
amortized in 30 annual installments of approximately $56.1 million
(beginning with fiscal year 1971 if the provision is enacted before
July 1, 1971). The normal cost of the retirement system would be
increased by 0.11 percent, to 14.09 percent.
We note there are certain technical and conforming changes that
should be made in the text of S. 437. Our technical staff will be avail-
able to advise on this if the committee so desires.
The Office of Management and Budget advises that from the
standpoint of the administration's program there is no objection to
the submission of this report.
By direction of the Commission :
Sincerely yours,
ROBERT HAMPTON, Chairman.
In compliance with subsection 4 of rule XXIX of the Standing
Rules of the Senate, changes in existing law made by the bill as re-
ported are shown as follows (existing law in which no change is pro-
posed is shown in roman; existing law proposed to be omitted is en-
closed in black brackets; new matter is shown in italic) :
Chapter 83, Title 5, United States Code
* * * * * *
? 8339. Computation of annuity
(a) Except as otherwise provided by this section., the annuity of an
employee retiring under this subchapter is-
(1) 13 percent of his average pay multiplied by so much of his
total service as does not exceed 5 years; plus
(2) 13/4 percent of his average pay multiplied by so much of his
total service as exceeds 5 years but does not exceed 10 years; plus
(3) 2 percent of his average pay multiplied by so much of his
total service as exceeds 10 years.
However, when it results in a larger annuity, 1 percent of his average
pay plus $25 is substituted for the percentage specified by paragraph
(1), (2), or (3) of this subsection., or any combination thereof.
(b) The annuity of a Congressional employee, or former Con-
gressional employee, retiring under this subchapter is computed under
subsection (a) of this section, except, if he has had-
(1) at least 5 years' service as a Congressional employee or
Member or any combination thereof; and
(2) deductions withheld from his pay or has made deposit
covering his last 5 years of civilian service;
his annuity is computed, with respect to his service as a Congressional
employee, his military service not exceeding 5 years, and any Member
service, by multiplying 2% percent of his average pay by the years
of that service.
(c) The annuity of a Member, or former Member with title to
Member annuity, retiring under this subchapter is computed under
subsection (a) of this section, except, if he has had at least 5 years'
service as a Member or Congressional employee or any combination
thereof, his annuity is computed with respect to-
Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
 Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
(1) his service as a Member an so much of his military service
as is creditable for the purpose of this paragraph; and
(2) his Congressional employee; service;
by multiplying 2% percent of his average pay by the years of that
service.
(d) The annuity of an employee retiring under section 8336(c) of
this title is 2 percent of his average pay multiplied by his total service.
. (( ') The annuity computed under subsections (a)-(d) of this section
may not exceed 80 percent of-
(1) the average pay of the employee; or
(2) the greater of-
(A) the final basic pay of the Member; or
(B) the final basic pay of the appointive position of a for-
mer Member who elects to have his annuity computed or re-
computed under section 8344(b) (1) of this title.
(f) The annuity of an employee or Member retiring under section
8337 of this title is at least the smaller of-
(1) 40 percent of his average pay; or
(2) the sum obtained under subsections (a)-(c) of this section
after increasing his service of the type last performed by the
period elapsing between the date of separation and the date he
becomes 60 years of age.
(g) The annuity computed under subsections (a), (b), and (e) of
this section for an employee retiring tinder section 8336(d) of this
title is reduced by % of 1 percent for each full month the employee is
under 55 years of age at the date of separation. The annuity computed
under subsections (c) and (e) of this section for a Member retiring
under the second or third sentence of section 8336(f) of this title or
the third sentence of section 8338(h) of this title is reduced by % of
1 percent for each full month not in excess of 60 months, and ii of 1
percent for each full month in excess of 60 months, the member is
under 60 years of age at the (late of separation.
(h) The annuity computed under subsections (a)-(g) of this section
is reduced by 10 percent of a deposit described by section 8334(c) of
this title remaining unpaid, unless the employee or Member elects to
eliminate the service involved for the purpose of annuity computation.
(i) The annuity computed under subsections (n)-(h) of this section
for a married employee or Member retiring under this subchapter, or
any portion of that annuity designated'in writing for the purpose of
section 8:341(b) of this title by the employee or Member at the time
of retirement, is reduced by 2% percent of so much thereof as does not
exceed $3,600 and by 10 percent of so much thereof as exceeds $3,600,
unless the employee or Member notifies the Civil Service Commission
in writing at the time of retirement that',he does not desire his spouse
to receive an annuity under section 8341 (b) of this title.
(j) (1) At the time of retiring under section 8336 or 8338 of this title,
an unmarried employee or Member who is found to be in good health
by the Commission may elect a reduced annuity instead of an annuity
computed under subsections (a)-(h) of this section and name in
writing an individual having an insurable interest in the employee or
Member to receive an annuity under section 8341(c) of this title after
the death of the retired employee or Member. The annuity of the
employee or Member making the election is reduced by 10 percent,
and by 5 percent for each full 5 years the individual named is younger
Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
 Approved For Release 2001/11/0 : CIA-RDP74B00415R000600020007-3
than the retiring employee or Member. However, the total reduction
may not exceed 40 percent.
(2) An employee or Member who is unmarried at the time of retiring
or an annuitant who is unmarried at the time of separation and who
later marries may, within one year after he marries, select a reduced
annuity with benefit to surviving spouse as provided in section 834.1(b).
His annuity is recomputed and paid under the provisions of section
8339(i) effective the first day of the month after his written election is
received in the Civil Service Commission. An election under this paragraph
voids prospectively any election previously made under paragraph (1)
of this subsection.
(k) The annuity computed under subsections (a)-(j) of this section
for an employee who is a citizen of the United States is increased by
$36 for each year of service in the employ of-
(1) the Alaska Engineering Commission, or The Alaska, Rail-
road, in Alaska between March 12, 1914, and July 1, 1923; or
(2) the Isthmian Canal Commission, or the Panama Railroad
Company on the Isthmus of Panama between May 4, 1904, and
April 1, 1914.
(I) In determining service for the purpose of computing an annuity
under each paragraph of this section, 45 per centum of each year, or
fraction thereof, of service referred to in section 8332(b)(6) which
was performed prior to the effective date of the National Guard
Technicians Act of 1968 shall be disregarded.
(m) In computing any annuity under subsections (a)-(d.) of this
section, the total service of an employee who retires on an immediate
annuity or dies leaving a survivor or survivors entitled to annuity
includes, without regard to the limitations imposed by subsection (e)
of this section, the days of unused sick leave to his credit under it
formal leave system, except that these days will not be counted in
determining average pay or annuity eligibility under this subchapter.
? 8340. Cost-of-living adjustment of annuities
(a) Effective December 1, 1965, each annuity payable from the Fund
having a commencing date before December 2, 1965, is increased by-
(1) the percent rise in the price index, adjusted to the nearest
?o of 1 percent, determined by the Civil Service Commission on
the basis of the annual average price index for calendar year 1962
and the price index for the base month of July 1965; plus
(2) 632 percent if the commencing date (or in the case of the
survivor of a deceased annuitant the commencing date of the
annuity of the retired employee) occurred before October 2, 1956,
or 132 percent if the commencing date (or in the case of the sur-
vivor of a deceased annuitant the commencing date of the annuity
of the retired employee) occurred after October 1, 1956.
Each annuity payable from the Fund (other than the immediate
annuity of an annuitant's survivor or of a child entitled under section
8341(e) of this title) having a commencing date after December 1,
1965, but before January 1, 1966, is increased from its commencing
date as if the annuity commencing date were December 1, 1965. Each
survivor annuity authorized by-
(A) section 8 of the Act of May 29,.1930, as amended to July
6, 1950; or
(B) section 2 of the Act of June 25, 1958 (72 Stat. 219) ;
S. Rept. 91-1092-2
Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
 Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
10
is increased by any additional amount required to make the total
increase under this subsection equal to the smaller of 15 percent or $10
a month.
(b) Each month the Commission shall determine the percent change
in the price index. Effective the first day of the third month that
begins after the price index change equals a rise of at least 3 percent
for 3 consecutive months over the price index for the base month, each
annuity payable from the Fund having ,a commencing date not later
than that effective date shall be increased by 1 percent plus the percent
rise in the price index (calculated on the highest level of the price
index during the 3 consecutive months) !adjusted to the nearest hio of
1 percent.
(c) Eligibility for an annuity increase under this section is gov-
erned by the commencing date of each annuity payable from the Fund
as of the effective date of an increase, except as follows:
(1) Effective from its commencing date, an annuity payable
from the Fund to an annuitant's survivor (except a child entitled
under section 8341(e) of this title), which annuity commences the
day after the death of the annuitant and after the effective date of
the first increase under this section, shall be increased by the total
percent increase the annuitant was receiving under this section at
death. However, the increase in a survivor annuity authorized by
section 8 of the Act of May 29, 1930, as amended to July 6, 1950,
shall be computed as if the annuity commencing date had been the
effective date of the first increase under this section.
(2) For the purpose of computing the annuity of a child
under section 8341(n) of this title that commences on or after the
first day of the first month that begins on or after the date of
enactment, of the Civil Service Retirement Amendments of 1969,
the items $900, $1,080, $2,700, and i$3,240 appearing in section
8341(e) of this title shall be increased by the total percent in-
creases allowed and in force under this section on or after such
day and, in case of a deceased annuitant, the items 60 percent and
75 percent appearing in section 8341'(e) of this title shall be in-
creased by the total percent allowed and in force to the annuitant
under this section on or after such day.
(d) This section does not authorize an increase in an additional
annuity purchased at retirement by voluntary contributions.
(e) The monthly installment of annuity after adjustment under
this section shall be fixed at the nearest dollar. Hovw-ever, the monthly
installment shall after adjustment reflect 'n increase of at least $1.
(f) Effective September 1, 1966, or on the commencing date of an-
nuity, whichever is later, the annuity of each surviving spouse whose
entitlement to annuity payable from the Fund resulted from the (loath
of-
(1) an employee or Member before October 11, 1962; or
(2) a retired employee or Member whose retirement was based
on a separation from service before October 11, 1962;
is increased by 10 percent.
? 8341. Survivor annuities
(a) For the purpose of this section--
(1) "widow" means the surviving wife of an employee or Mem-
ber who-
Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
 Approved For Release 2001/11/91 : CIA-RDP74B00415R000600020007-3
(A) was married to him for at least 2 years immediately
before his death; or
(B) is the mother of issue by that marriage;
(2) "widower" means the surviving husband of an employee
or Member who--
(A) was married to her for at least 2 years immediately
before her death; or
(B) is the, father of issue by that marriage; and
[(3) "dependent widower" means a widower who-
(A) is incapable of self-support because of mental or phys-
ical disability; and
(B) received more than half his support from the em-
ployee or Member; and]
[(4)](3) "child" means-
(A) an unmarried child under 18 years of age, including
(i) an adopted child, and (ii) a stepchild or recognized nat-
ural child who lived with the employee or Member in a
regular parent-child relationship;
(B) such unmarried child regardless of ago who is inca-
pable of self-support because of mental or physical disability
incurred before age l8; or
(C) such unmarried child between 18 and 22 years of age
who is a student regularly pursuing a full-tune course of study
h
l
-
, tec
or training in residence in a high school, trade schoo
meal or vocational institute, junior college, college, univer-
sity, or comparable recognized educational institution.
For the purpose of this paragraph and subsection (e) of this sec-
tion, a child whose 22nd birthday occurs before July 1 or after
August 31 of a calendar year, and while he is regularly pursuing
such a course of study or training, is deemed to have become 22
years of age on the first day of July after that birthday. A child
who is a student is deemed not to have ceased to be a student dur-
ing an interim between school years if the interim is not more than
5 months and if he shows to the satisfaction of the Civil Service
Commission that he has a bona fide intention of continuing to
pursue a course of study or training in the same or different school
l
during the school semester (or other period into which the schoo
(b) If an employee r Member dies after having retired under this
subchapter and is survved by a spouse to whom he was married at
the time of retirement)the spouse is entitled to an annuity equal to
55 percent of an annuity computed under section 8339 (a)-(h) of this
I title as may apply with respect to the annuitant, or of such portion
thereof as may have been designated for this purpose under section
8339(i) of this title, unless the employee or Member has notified the
Commission in writing at the time or retirement that he does not desire Gj
's spous to receive this annuity. The annuity of the spouse com-
mences on the day after the retired employee or Member dies. This
annuity and the right thereto terminate on the last day of the month
before-
(1) the spouse of a retired employee dies, or remarries before
becoming 60 years of age; or
(2) the spouse of a retired Member dies or remarries.
(c) The annuity of a survivor named under section 8339(j) of this
title is 55 percent of the reduced annuity of the retired employee or
Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
 Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
12
Member. The annuity of the survivor commences on the day after
the retired employee or Member dies. This annuity and the right
thereto terminate on the last day of the month before the survivor
(ties.
(d) If an employee or Member dies after completing at least 1S
months of civilian service, the widow o5 [dependent] widower of the
employee or Member is entitled to an annuity equal to 55 percent of
an annuity computed under section 8339 (a)-(e) and (h) of this title
as may apply with respect to the employee or Member, except that in
the computation of the, annuity under such section, the annuity of the
employee or Member shall be at least the smaller of (i) 40 percent of
his average pay, or (ii) the sum obtained under such section after
increasing his service of the type last performed by the period elapsing
between the date of death and the date be would have become 60 years
of age. The annuity of the widow or [dependent] widower commences
on the day after the employee or Member dies. This annuity and the
right thereto terminate on the last day of the month before-
(1) the widow or [dependent] widower dies;
[(2) the dependent widower becomes capable of self-support;]
[(3)] (2) the widow or [dependent] widower of an employee
remarries before becoming 60 years of age; or
[(4)] (3) the widow or [dependent] widower of a Member
remarries.
(e) (1) If any employee or Member dies after completing at least
18 months of civilian service, or an employee or Member dies after
retiring under this subchapter, and is survived by a spouse, each sur-
viving child is entitled to an annuity equal to the' smallest of-
(A) 60 percent of the average pay of the employee or Member
divided by the number of children;
(B) $900; or
(C) $2,700 divided by the number of chi dren;
subject to section 8340 of this title. if the employee or Member is not
survived by a spouse, each surviving child is entitled to an annuity
equal to the smallest of-
(i) 75 percent of the average pay, of the employee or Member
divided by the number of children;
(ii) $1,080; or
(iii) $3,240 divided by the numbei of children;
subject to section 8340 of this title.
(2) The annuity of a child under this' subchapter or under the Act
of May 29, 1930, as amended from and after February 28, 1948, com-
mences on the day after the employee or!Member dies, or commences
or resumes on the first day of the month in which the child later be-
comes or again becomes a student as descfibed by subsection (a) [(4)]
(3) of this section, if any lump sum paid is returned to the Fund. This
annuity and the right thereto terminate on the last day of the month
before the child-
(A) becomes 18 years of age unless he is then a student as de-
scribed. or incapable of self-support;
(B) becomes capable of self-support after becoming 18 years
of age unless he is then such a student;
(C) becomes 22 years of age if be is then such a student and
capable of self-support;
Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
 Approved For Release 2001/11/013 CIA-RDP74B00415R000600020007-3
(D) ceases to be such a student after becoming 18 years of age
unless he is then incapable of self-support; or
(E) dies or marries;
whichever first occurs. On the death of the surviving spouse or termi-
nation of the annuity of a child, the annuity of any other child or
children shall be recomputed and paid as though the spouse or child
had not survived the employee or Member.
(f) If a Member heretofore or hereafter separated from the service
with title to deferred annuity from the Fund hereafter dies before
having established a valid claim for annuity and is survived by a
spouse to whom married at the date of separation, the surviving
spouse-
(1) is entitled to an annuity equal to 55 percent of the deferred
annuity of the Member commencing on the day after the Member
dies and terminating on the last day of the month before the
surviving spouse dies or remarries; or
(2) may elect to receive the lump-sum credit instead of annuity
if the spouse is the individual who would be entitled to the lump-
sum credit and files application therefor with the Commission
before the award of the annuity.
(g) In the case of a surviving spouse whose annuity under this sec-
tion is terminated after July 18, 1066, because of remarriage before
becoming 60 years of age, annuity at the same rate shall be restored
commencing on the day the remarriage is dissolved by death, annul-
ment, or divorce, if-.
(1) the surviving spouse elects to receive this annuity instead
of a survivor benefit to which he may be entitled, under this
subchapter or another retirement system for Government em-
ployees, by reason of the remarriage; and
(2) any lump sum paid on termination of the annuity is re-
turned to the Fund.
8342. Lump-sum benefits; designation of beneficiary; order of
precedence
(a) An employee or Member who is separated from the service, or
is transferred to a position in which he does not continue subject to
this subchapter, is entitled to be paid the lump-sum credit if his sepa-
ration or transfer occurs and application for payment is filed with the
Civil Service Commission at least 31 days before the earliest commenc-
ing date of any annuity for which he is eligible. The receipt of payment
of the lump-sum credit by the individual voids all annuity rights under
this subchapter, until he is reemployed in the service subject to this
subchapter. This subsection. also applies to an employee or Member
separated before October 1, 1956, after completing at least 20 years
of civilian service.
(b) Under regulations prescribed by the Commission, a present or
former employee or Member may designate a beneficiary or benefici-
aries for the purpose of this subchapter.
(c) Lump-sum benefits authorized by subsections (d)-(f) of this
section shall be paid to the person or persons surviving the employee
or Member and alive at the date title to the payment arises in the fol-
lowing order of precedence, and the payment bars recovery by any
other person:
Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
 Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
14
First, to the beneficiary or beneficiaries designated by the em-
ployee or Member in a signed and witnessed writing received in
the Commission before his death. For this purpose, a designation,
change, or cancellation of beneficiary in a will or other document
not so executed and filed has no force or effect.
Second, if there is no designated beneficiary, to the widow or
widower of the employee or Member.
Third, if none of the above, to the child or children of the
erployee or Member and descendants of deceased children by
representation.
Fourth, if none of the above, to the parents of the employee or
Member or the survivor of them.
Fifth, if none of the above, to the duly appointed executor or
administrator of the estate of the employee or Member.
Sixth, if none of the above, to such other next of kin of the
employee or Member as the Commission determines to be entitled
under the laws of the domicile of the employee or Member at the
(late of his death.
For the purpose of this subsection, "child" includes a natural child
and an adopted child, but does not include a stepchild.
(d) If an employee or Member dies-
(1) without a survivor; or
(2) with a survivor or survivors and the right of all survivors
terminates before a claim for survivor annuity is filed;
or if a former employee or Member not retired dies, the lump-sum
credit shall be paid.
(e) If all annuity rights under this subchapter based on the service
of a deceased employer or Member terminates before the total annuity
paid equals the lump-sum credit, the difference shall be paid.
(f) If an annuitant dies, annuity accrued and unpaid shall be paid.
(g) Annuity accrued and unpaid on ! the termination, except by
death, of the annuity of an annuitant or survivor annuitant shall be
paid to that individual. Annuity accrued and unpaid on the death of
a survivor annuitant shall be paid in the following order of prece-
dence, and the payment bars recovery by any other person:
First, to the duly appointed executor or administrator of the
estate of the survivor annuitant.
Second, if there is no executor or administrator, payment may
be made, after 30 days from the date of death of the survivor
annuitant, to such next of kin of the survivor annuitant as the
Commission determines to be entitled under the laws of the domi-
cile of the survivor annuitant at the date of his death.
(h) Amounts deducted and withheld from the basic pay of an em-
ployee or Member from the first day of the first month which begins
after he has performed sufficient service (excluding service which the
employee or Member elects to eliminate for the purpose of annuity
computation under section 8339 of this title) to entitle him to the
maximum annuity provided by section 8339 of this title, together with
interest on the amounts at the rate of 3 percent a year compounded
annually from the date of the deductions; to the date of retirement or
death, shall be applied toward any deposit due under section 8334 of
this title, and any balance not so required is deemed a voluntary
contribution for the purpose of section 8343 of this title.
(i) An employee who-
Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
 Approved For Release 2001/11/015: CIA-RDP74B00415R000600020007-3
(1) is separated from the service before July 12, 1960; and
(2) continues in the service after July 12, 1960, without break
in service of 1 workday or more;
is entitled to the benefits of subsection (h) of this section.
? 8343. Additional annuities; voluntary contributions
(a) Under regulations prescribed by the Civil Service Commission,
an employee or Member may voluntarily contribute additional sums in
multiples of $25, but the total may not exceed 10 percent of his basic
pay for creditable service after July 31, 1920. The voluntary contribu-
tion account in each case is the sum of unrefunded contributions, plus
interest at 3 percent a year compounded annually to-
(1) the date of payment under subsection (d) of this section,
separation, or transfer to a position in which he does not con-
tinue subject to this subchapter, whichever is earliest; or
(2) the commencing date fixed for a deferred annuity or date
of death, whichever is earlier, in the case of an individual who is
separated with title to deferred annuity and does not claim the
voluntary contribution account.
(b) The voluntary contribution account is used to purchase at re- .
tirement an annuity in addition to the annuity otherwise provided.
For each $100 in the voluntary contribution account, the additional
annuity consists of $7, increased by 20 cents for each full year, if any,
the employee or Member is over 55 years of age at the date of
retirement.
(c) A retiring employee or Member may elect a reduced additional
annuity instead of the additional annuity described by subsection (b)
of this section and designate in writing an individual to receive after
his death an annuity of 50 percent of his reduced additional annuity.
The additional annuity of the employee or Member making the elec-
tion is reduced by 10 percent, and by 5 percent for each full 5 years the
individual designated is younger than the retiring employee or Mem-
ber. However, the total reduction may not exceed 40 percent.
(d) A present or former employee or Member is entitled to be paid.
the voluntary contribution account if he files application for payment
with the Commission before receivingan additional annuity. An indi-
vidual who has been paid the voluntary contribution account may not
again deposit additional sums under this section until, after a separa-
tion from the service of more than 3 calendar days, he again becomes
subject to this subchapter.
(e) If a preseht or former employee or Member not retired dies, the
voluntary contribution account is paid under section 8342(c) of this
title. If all additional annuities or any right thereto based on the
voluntary contribution account of a deceased employee or Member ter-
minate before the total additional annuity paid equals the account, the
difference is paid under section 8342(c) of this title.
? 8344. Annuities and pay on reemployment
(a) If an annuitant receiving annuity from the Fund, except-
(1) a disability annuitant whose annuity is terminated because
of his recovery or restoration of earning capacity;
(2) an annuitant whose annuity is based on an involuntary
separation from the service other than an automatic separation;
or
Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
 Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
16
(3) a Member receiving annuity from the Fund;
becomes employed after September 30, 1956, or on July 31, 1956, was
serving, in an appointive or elective position, his service on and after
the date he was or is so employed is covered by this subchapter. De-
ductions for the Fund may not be withheld from his. pay. An amount
equal to the annuity allocable to the period of actual employment
shall be deducted from his pay, except for lump-sum leave payment
purposes under section 5551 of this title. If the annuitant serves on a
full-time basis, except as President, for at least 1 year in employment
not excluding him from coverage under section 8331(1) (i) or (ii) of
this title-
(A) his annuity on termination of employment is increased by
an annuity computed under section 8339 (a), (b), (d), (g), and
(h) of this title as may apply based on the period of employment
and the basic pay, before deduction, averaged during that
employment; and
(B) his lump-sum credit may not be reduced by annuity paid
(luring that employment. If the annuitant on termination of em-
ployment is married to a spouse potentially entitled to annuity as
surviving spouse under section 8341 of this title, the supplemental
annuity payable under the fourth sentence of this subsection is
reduced by 10 percent and the spouseis entitled to an annuity equal
to 55 percent of the supplemental annuity commencing and termanat-
ii;ng at the same times as the survivor annuity payable under section
8341 of this title, unless at the time of claiming the supplemental
annuity the annuitant notifies the 'Civil Service Commission in
writing that he does not desire his spouse to receive this annuity.
If the described employment of the annuitant continues for at least
5 years, he may elect, instead of the benefits provided by this sub-
section, to deposit in the Fund an amount computed under section
8334(e) of this title covering that employment and have his rights
redetermined under this subchapter. Notwithstanding the restrictions
contained in section 115 of the Social Security Amendments of 1954
(68 Stat. 1087), a similar right to redetermination after deposit is
applicable to an annuitant-
(i) whose annuity is based on an! involuntary separation from
the service; and
(ii) who is separated after July 11, 1960, following such a pe-
riod of employment on a full-time basis that began before Octo-
ber 1, 1956.
(The employment of an annuitant under this subsection does not
create an annuity for or affect the annuity of a survivor.]
(b) If a Member receiving annuity f?rom the Fund becomes em-
ployed in an appointive or elective position, annuity payments are
discontinued during the employment and' resumed in the same amount
on termination of the employment, except that-
(1) the retired Member or Member separated with title to im-
mediate or deferred annuity, who serves at any time after separa-
tion as a Member in an appointive position in which he is subject
to this subchapter, is entitled, if he so elects, to have his Member
annuity computed or recomputed as if the service had been per-
formed before his separation as a Member and the annuity as so
computed or recomputed is effective-
(A) the day Member annuity commences; or
Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3
 Approved For Release 2001/11/0117: CIA-RDP74B00415R000600020007-3
(B) the day after the date of separation from the appoint-
ive position;
whichever is later;
(2) if the retired Member becomes employed after December 31,
1958, in an appointive position on an intermittent-service basis-
(A) his annuity continues during the employment and is
not increased as a result of service performed during that
employment;
(B) retirement deductions may not be withheld from his
pay;
(C) an amount equal to the annuity allocable to the period
of actual employment shall be deducted from his pay, except
for lump-sum leave payment purposes under section 5551 of
this title; and
(D) the amounts so deducted shall be deposited in the
Treasury of the United States to the credit ofpthe Fund;
(3) if the retired Member becomes employed after December 31,
1958, in an appointive position without pay on a full-time or
substantially full-time basis, his annuity continues during the
employment and is not increased as a result of service performed
during the employment; and
(4) if the retired Member takes office as Member and gives
notice as provided by section 8331(2) of this title, his service as
Member during that period shall be credited in determining his
right to and the amount of later annuity.
This subsection does not apply to a Member appointed by the Presi-
dent to a position not requiring confirmation by the Senate.
0
Approved For Release 2001/11/01 : CIA-RDP74B00415R000600020007-3