RETIREMENT: SENATOR STEVENS SUPPLEMENTAL PLAN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP87M01152R000200160010-7
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 126
• Document Creation Date: December 22, 2016
• Document Release Date: August 19, 2010
• Sequence Number: 10
• Publication Date: March 6, 1985
• Content Type: MEMO

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STAT
VIA: Acting Chief, Liaison Division, OLL
Liaison Division, OLL
STAT
STAT
STAT
STAT
SUBJECT: Retirement: Senator Stevens Supplemental
Plan
1. Attached hereto is the updated version of Senator Ted
Stevens (R., AL) bill to establish a "Civil Service Pension"
for all Federal civilian employees hired on or after 1
January 1984. Also attached is the most recent draft of a
"Section-by-Section Analysis" of the bill, and summary of the
bill. Please destroy earlier versions of the bill (the last
distributed was dated 16 January 1984).
2. The staff does not anticipate further changes. This
bill will soon be introduced and hearings will commence in
March. There are no changes to earlier reports on Senate
plans for supplemental retirement.
(b)(3)
(b)(3)
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~ ~1~,e1X 198.x"
Section-by-Section Analysis
The opening section (section 2) provides for the purpose
of the legislation. The purposes delineated include providing
a stable and flexible retirement plan which is comparable to
good private sector retirement benefits plans, enhancing porta-
bility of retirement assets between Federal jobs and jobs outside
the Federal government, and ensuring a fully funded and financiall}~
sound federal retirement program.
Title I - Civil Service Pension System
Section 101(a) amends title 5, United States Code, by
inserting a new chapter 84, entitled "Civil Service Pension
System" (CSPS) .
Subchapter I of this chapter provides definitions for
administration of the CSPS, identifies the participants in the
new CSPS, and specifies its relationship to the Social Security
Act. Employees of the District of Columbia are specifically
excluded. Employees of the current Civil Service System are
included if they so choose pursuant to Section 8471.
Subchapter II describes the basic retirement plan, which
is a defined benefits plan applicable to all permanent employees
covered by the Social Security System on or after January 1, 1984
and any employees subject to the CSRS who elect to join the CSPS.
Section 8411 of such title lists the combinations of age
and service which establish entitlement to an immediate annuity.
Subsections (a) and (b) provide for an immediate annuity
at age 55 with 30 years of service and age 62 with 10 years of
service.
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Subsections (c) and (d) provide for an immediate annuity
to the special retirement classes (law enforcement officer,
firefighter, or air traffic controller) at age 55 with 25
years of service in those respective occupations.
Subsection (e) recognizes the unique situation of
military technicians who must maintain military membership
as a condition of civil service employment. This currently
is covered, for National Guard technicians, in the National
Guard Technicians Act of 1968; for reserve technicians,
coverage is by administrative agreement with the Office of
Personnel Management.
Subsection (f) provides for an immediate annuity to an
employee who is separated from the service involuntarily and
who has completed 25 years of service or is not less than age
50 with 20 years of service.
Subsection (g) provides that the annuity authorized by
this section is computed under sections 8413 through 8415 of
this title.
Section 8412 provides for deferred retirement at age 62
to a participant under age 62 who terminates service after
completing 10 years of civilian service.
Section 8413 provides the formula for computing the annuit~~
a participant is entitled to receive.. The formula is 0.85
percent of the average pay over a period of five consecutive
years multiplied by the number of years of service. For the
special retirement classes, an annuity supplement equal to the
amount of Social Security benefits paid at age 62 will be paid
to annuitants under age 62 until they reach age 62. This
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supplement will be increased annually by the percent increase
in the index of national salaries and wages.
Section 8414 provides for a reduction of an immediate
annuity by two percent for each year the participant is under
age 62 on the date of separation. For employees in the
special retirement classes who are involuntarily separated
prior to age 55, the two percent reduction applies to each
year the participant is under age 55. This is also appli-
cable to military technicians whose loss of military status
results in their involuntary separation from their technician
position.
Section 8415 lists the methods by which an annuity may
be reduced to provide for a survivor annuity.
Subsection (a) provides for an automatic annuity reduction
to provide a survivor annuity to the spouse of a married parti-
cipant unless the participant and his or her spouse jointly
waive the spouse's right to a survivor annuity.
Subsection (b) provides for an automatic annuity reduction
when the participant has a former spouse who is entitled to a
survivor annuity.
Section 8416 provides that OPM shall prescribe methods of
payment of annuities and participant election of the method
preferred. Included in those methods are:
(1) a monthly annuity only during the life of the
annuitant
(2) a monthly annuity for the joint lives of the
annuitant and spouse and the life of the one
of them who survives the other.
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Section 8417 provides that the participant's employing
agency shall contribute an amount equal to the normal cost of
an annuity under this subchapter for each participant employed
by the agency. It also provides for a yearly determination
of the Fund's supplemental liability which is to be credited
to the Fund by the Secretary of the Treasury or the Post-
master General of the United States, as appropriate.
Subchapter III describes the thrift savings plan, which
is an optional plan permitting participants and those former
participants who are receiving disability benefits to con-
tribute a percentage of their basic pay or disability benefits
to a selected investment vehicle and have those contributions
matched two for one by the government, up to a maximum of
an eight percent government contribution.
Section 8421(a) allows participants to contribute up to
10 percent of their basic pay to the thrift plan. Former
participants under age 62, who are receiving disability
benefits, may contribute up to 10 percent of the disability
benefits payable. An opportunity to change the contribution
amount will be provided at least annually.
Section 8421(b} requires the employing agency to contribute
an amount equal to twice the contribution of the participant
at the same time as the participant's contribution is made.
The total amount of the employing agency's contribution
cannot exceed eight percent of the participant's annual rate
of basic pay or the disabled participant's disability benefits
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for the fiscal year.
Section 8421(c) provides that appropriations or funds
available to the agency for payments of basic pay are to
serve as the source of the agency's contribution to the
thrift fund.
Section 8421(d) provides that amounts contributed by
the employee to the thrift fund are not included in gross
income for income tax purposes.
Section 8422 provides a vesting schedule for the thrift
plan. A participant immediately vests in his contributions
and their earnings. Beginning at two years of service, the
participant vests in 25 percent~of the employer's contribution.
This increases by 25 percent for each additional year of parti-
cipation up to five years and beyond, when the entire share
contributed by the employer, plus interest, is vested: A
participant who dies while employed by the government
immediately vests in 100 percent of the employer's contribution
and the earnings on it.
Subsection 8423(a) permits a participant who separates
from government employment when entitled to an immediate annuity
to elect one of four methods of receiving money credited to
his or her thrift account. These methods are:
(1) An immediate annuity
(2) A deferred annuity
(3) A lump sum withdrawal
(4) Transfer to an individual retirement account
or another qualified plan
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Subsection 8423(b) permits a participant who separates
from government employment before becoming entitled to an
immediate annuity to elect one of three methods of receiving
money credited to his or her thrift account. These methods
are:
(1) An annuity at age 62
(2) A lump sum withdrawal at age 62
(3) Transfer to an individual retirement account
or another qualified retirement plan
Subsection 8423(c) permits a participant who elected to
defer an annuity payment under subsection 8423(a) to modify
the date specified in that election.
Subsection 8423(d) requires participants who transferred
from the CSRS to wait five years from their date of participation
before they can receive or transfer their accounts if they
separate from service during the five year period. This
limitation does not apply to transferees who become eligible
for an immediate or a deferred annuity before the five year
period expires.
Section 8424 describes how annuities available from the
thrift plan will be computed and paid. The Thrift Investment
Board will prescribe methods of payment which must include a
monthly annuity payable only during the life of the annuitant
and a monthly annuity payable for the joint lives of the one who
survives the other. The amounts will be determined in accordance
with generally accepted actuarial principles. Methods for pro-
viding annual increases in the annuity payable must also be
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prescribed. At the end of each fiscal year, a reconcil-
iation of the investment experience for the annuitant's
account and the actuarial assumptions used to compute the
annuity will be made. Any excess return will be used to
purchase an additional annuity payable from the fund.
Section 8425 provides rules for payments and elections
by participants entitled to payments or transfers from the
thrift plan.
Section 8426 establishes the Thrift Savings Fund and
prescribes how monies in the Fund may be used. One such use
is loans to participants in cases of hardship.
Section 8427 identifies categories of investments
available to the Board for investment of sums in the Fund
and provides that Fund participants may elect the type or
types of investments into which money in their account will
be invested. The section also specifies, for the imple-
mentation phase, a minimum percentage of contributions made
(1) by the participant and (2) on behalf of the participant
which must be invested, during a given period of time, in
United States government securities. The initial percentage
is 100, reduced over a four year period by 25$ each year
for the participant's contributions. For the agency's
contribution, the reduction goes to a final rate of 12.5
over a 12 year period. All sums initially credited for
transfer participants and for participants hired during the
temporary adjustment period will be invested in U.S. govern-
ment securities. All amounts earned on sums invested in
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interest-bearing securities of the United States government
and matured investments will be reinvested in interest-
bearing securities of the United States government. The
Board is restricted from investing in equity securities of
private businesses to the extent that their ownership
interest would permit them to direct the management of that
private business.
Section 8428 prescribes how the Board is to account for
the funds of each participant in the System and requires
that the participant be provided an annual statement of his
or her account.
Subchapter IV describes the benefits available to sur-
vivors of deceased participants and former participants.
Section 8431 provides for payment of death benefits
from the basic plan to a participant's survivor if the
deceased had at least 18 months of service. The survivor
gets the higher of:
(1) 50 percent of the accrued annuity (computed as
if the worker had retired the day before death, with any
applicable early retirement reductions, but without the
reduction for survivor benefits), or
(2) 25 percent of the worker's high-five average
salary. This benefit is offset by the family benefits.
This offset does not apply if the only benefit payable is a
child's insurance benefit.
Section 8432 provides for payment of death benefits
from the basic plan to a retiree's survivor unless the
surviving spouse waived a survivor annuity. Survivors
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eligible for social security benefits get 50 percent of the
unreduced annuity (except for early retirement reduction).
Survivors who are not eligible for social security get the
full annuity that was payable to the retiree (after reductions
for early retirement and survivor benefits). When they become
eligible for social security, they get 50 percent of that
amount, taking into account any adjustments made in the annuity
since the date of death.
Money required to pay an annuity to a former spouse is
deducted from the amounts described above.
Section 8433 provides for survivor benefits from the thrift
savings plan using one of three methods. These are:
(1) An annuity payable for life,
(2) Transfer of the money to the spouse's individual
retirement account, or
(3) Lump sum payment
Money required to pay an annuity to a former spouse is
deducted from a distribution to the surviving spouse or the
estate and held in a fund until expended in payment of that
annuity, unless terminated. Any remaining money in such fund
goes to the surviving spouse or the estate.
Section 8434 provides for survivor benefits from the
basic plan and the thrift plan for eligible former spouses.
The benefits from the basic plan are the same as for a sur-
viving spouse under sections 8431 or 8432.
-- In all three of the above sections, any prior elections
or prior court orders or decrees concerning an annuity for a
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former spouse must be honored before payment to a surviving
spouse or another former spouse can be made.
-- Benefits from the thrift fund are determined actuarially.
Section 8435 provides for a former participant to elect a
survivor benefit from the basic plan and the thrift plan for
an eligible former spouse.
Subsection (a) permits a participant who has a former
spouse to elect an annuity reduction in order to provide a
survivor annuity to such former spouse. The election must be
made on the date payment of an annuity from the basic plan
commences or, if later, within two years after the date on which
the marriage of the former spouse to the participant is dissolved.
A deposit, computed to reflect the amount by which the annuity
would have been reduced if it had been continuously in effect
since the date the annuity commenced, plus interest at six
percent is required. If the deposit is not made, the retiree's
annuity will be offset. An election of an annuity reduction
to provide a survivor benefit to a former spouse shall not be
effective if it
(1) conflicts with a court order or decree,
(2) exceeds the funds available to pay it, or
(3) is made without the spouse's written consent.
Subsection (b) provides that a retiree whose annuity
is being reduced to provide a survivor benefit to a former
spouse may elect to provide or increase a survivor annuity
for any other former spouse. This election must occur within
two years after the former spouse's date of death or remarriage
before age 55.
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Subsection (c) provides for a former participant to elect
to provide or increase a survivor annuity to his spouse if the
entitlement of an eligible former spouse is terminated or reduced
due to remarriage or death.
Section 8436 provides for termination of a survivor annuity
on death of the spouse, or former spouse, dissolution of the
marriage, or remarriage of the former spouse before reaching
age 55.
Subchapter V describes the disability benefits available
to a participant who has at least 18 months of service.
Section 8441 provides definitions for the administration
of this benefit.
Section 8442 provides that an eligible participant is
entitled to receive benefits under this subchapter while under
age 62. At age 62, the annuity is payable under the basic
plan provisions of subchapter II based on at least 10 years
actual service plus projected service through age 62. Average
pay is equal to pay on the date of disability, increased each
time after that date by the compounded overall average
percentage increase in the rates of the General Schedule
pursuant to section 5305.
Section 8443 provides the following methods for computing
disability benefits:
(1) If eligible for Social Security or ineligible
for Social Security only as a result of in-
sufficient quarters of coverage, 60 percent of
the high five salary minus 100 percent of the
Social Security benefit.
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(2) If ineligible for Social Security, 60 percent
of the high five salary for the first year.
After the first year, 20 percent of the high
five or the accrued benefit based on projected
service through age 62, whichever is lower.
Section 8444 requires a claim for disability benefits to
be filed within one year after the date the participant sepa-
rates from employment by the Federal Government. This time
limit may be waived by OPM.
Section 8445 requires OPM to direct a medical examination
of disability retirement applicants.
Section 8446 requires that an applicant who is determined
able to perform the work required in any position offered by the
agency must be considered for appointment to such position. The
applicant is entitled to appeal such a determination.
Section 8447 provides for termination of disability benefits
to an individual who recovers from the disability before reach-
ing age 62. These benefits may be resumed if there is a
recurrence of disability. In the case of an individual whose
benefits were terminated due to restored earning capacity,
benefits are resumed if he is not reemployed within one year,
his disability continues, and his income for one year is less
than the amount establishing his restored earning capacity.
Section 8448 establishes that an individual is not
entitled to receive both disability benefits under this chapter
and injury compensation benefits under subchapter I of chapter
81 of this title for the same period of time.
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Section 8449 provides for disability benefits for a
National Guard technician who is separated from employment
as a technician due to a disability which disqualifies him
from membership in the National Guard or from holding the
military grade required for such employment and who is not
placed in another position.
Section 8450 requires agencies to pay disability
benefits from their salary appropriations.
Subchapter VI describes general provisions applicable
to the administration of the basic plan.
Section 8451 provides that OPM shall pay all benefits
payable under the basic plan from the Fund.
Section 8452 provides for an annual adjustment to the
basic pension of the consumer price index minus 2 percentage
points. The adjustment is made in January and is based on
the change from September to September. A pro rata share of
the increase is payable to retirees or survivor annuitants
for whom this is the first increase.
Section 8453 provides that each annuity and disability
benefit is stated as an annual amount, one-twelfth of which
is the monthly rate payable.
Section 8454 provides that a participant's annuity
under the basic pension begins to accrue on the day after
the participant separates from government employment and
terminates on the date of death or other terminating event
provided by law. It further provides that a survivor
annuity begins to accrue on the date of death of the parti-
cipant or retiree on whom the annuity is based and terminates
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on the last day of the last month ending before the surviving
spouse dies or remarries before age 55.
Section 8455 provides that an individual entitled to
receive a basic pension may waive receipt of all or part of
the benefits. An individual may also make allotments from
the benefit payment.
Section 8456 provides that an application for benefits
must be received before the former participant's 115th
birthday; for survivor benefits, the application must be
received within 30 years after the death or other event
which establishes entitlement to the benefit.
Section 8457 requires compliance with the terms of a
court order requiring payment of an annuity, in whole or in
part, to another person.
Section 8458 provides for termination of an annuity
when an annuitant is employed in an appointive or elective
position in the Government. Upon termination of the employ-
ment, his annuity rights are redetermined. The amount of
the annuity resulting from a redetermination is not less
than the amount of the terminated annuity plus any increases
under section 8452 of this title.
Subchapter VII outlines the transition provisions for
individuals covered by the CSRS who choose to participate in
the CSPS.
Section 8471 permits CSRS participants to elect to
transfer to the CSPS or to begin participation in the CSPS
and retain accrued credit for entitlement to benefits under
the CSRS for service subject to that system. It also permits
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the same election to rehires who are required to participate
in the CSPS but who have an unrefunded lump-sum credit in
the Fund based on prior service under the CSRS.
Section 8472 provides that for transferees from the
CSRS to the CSPS, the total amount deposited to the CSRS
Fund on their behalf (employee and employer contributions),
plus interest on this amount as if it had been credited at
an annual rate of seven percent at the end of each year for
the amount deposited during that year and had been com-
pounded, will be transferred to the thrift savings fund in
the form of U.S. Government securities. All service credited
under subchapter III of chapter 83 is creditable service for
the basic pension benefit.
Section 8473 provides that CSRS participants who elect
to first participate in the CSPS are allowed credit for
service under both systems for purposes of determining
eligibility to retire in both systems. Pay for such in-
dividuals subsequent to beginning participation in the CSPS
is taken into account in computing average pay under both
systems.
Section 8474 provides that service by a participant
during the temporary adjustment period will be recognized by
transferring from the Fund to the Thrift Savings Fund an
amount which equals his or her contributions plus twice that
amount plus interest at 10~.
Section 8475 excludes former CSRS participants who join
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the CSPS from the offset provisions of the Social Security
Section 8476 authorizes OPM to prescribe regulations
to carry out this subchapter.
Subchapter VIII describes the Civil Service Thrift
Investment Board, which administers the Thrift Savings Fund.
Section 8491 provides that the Board is established as
an independent establishment in the executive branch of the
Federal government. The Board will be composed of six
members appointed by the President, confirmed by the Senate,
and an Executive Director appointed by a majority of the
members. Except for the members first appointed under this
section, the members and the Executive Director are appointed
for seven years.
Section 8492 lists the functions of the Board and the
Executive Director.
Section 8493 states the powers of the Board.
Section 8494 states the powers of the Executive Director,
including the authority to contract with private business
concerns for the investment of sums in the Thrift Savings
Fund and the management of such investments.
Section 8495 provides rules of administration for
actions of the Board.
Section 8496 identifies fiduciaries and their responsi-
bilities, defines "party in interest," lists prohibited
practices by fiduciaries, and describes penalties for
committing a prohibited practice.
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Title II - Amendments to the Internal Revenue Code of
1954 and the Social Security Act.
Section 201(a) amends section 210(a)(5) of the Social
Security Act by adding a new subparagraph concerning service
performed by an individual who transfers to or commences
participation in the CSPS.
Section 201(b) amends section 3121(b)(5) of the Internal
Revenue Code of 1954 by adding a new subparagraph concerning
service performed by an individual who transfers to or com-
mences participation in the CSPS.
Title III - Miscellaneous Amendments
Section 301 amends section 5363(a) of title 5, United
States Code, to provide pay retention for disabled employees
placed as a result of subchapter V of chapter 84 in a lower
grade position.
Section 302(a) amends section 8331 of title 5, U..S.
code, to exclude District of Columbia government employees
first employed after the effective date of this Act.
Section 302(b) amends section 8332 of title 5, United
States Code, by adding a new subsection excluding participants
in the CSPS from the creditable service provisions of the
CSRS. Also excluded are those who transfer from the CSRS.
Section 302(c) amends section 8334(a) of title 5,
United States Code, relating to deductions from an employee's
pay for both CSRS and Social Security coverage. An employee
who was covered by the CSRS on December 31, 1983 and who was
subsequently covered by Social Security will continue in the
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CSRS at a reduced contribution. The contribution to CSRS
will be equal to the excess of the employee's normal CSRS
contribution over the full Social Security contribution.
Section 302(d) amends section 8334(d) of title 5,
United States Code, to exclude participants under chapter 84
from making a redeposit to the Fund for a refund of retire-
ment deductions covering service for which they may be allowed
credit under subchapter III of chapter 83.
Section 302(e) amends section 8339 of title 5, United
States Code, to specify that the CSRS benefit will be offset
by 100 of the Social Security benefit attributable to
federal service. ,
Section 303 excludes participants in the CSPS from
participation in the Foreign Service Retirement and Dis-
ability System and the Central Intelligence Agency Retire-
ment and Disability System. It includes officers and
employees of the Postal Service for coverage under the
provisions of chapters 83 and 84 of title 5.
Section 304 amends title 5, U.S. Code, to incorporate
health benefit plan eligibility requirements for former
spouses as a result of P.L. 98-615.
Title IV - Authorization and Effective Dates.
Section 401 provides for payment of the fiscal year
1986 expenses of the Civil Service Thrift Investment Board
from appropriations.
Section 402 provides that this act takes effect 180
days after enactment, except for subchapter VIII of chapter
84 (relating to the Civil Service Thrift Investment Board),
which takes effect on the date of enactment.
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Participation-
- All permanent federal employees covered by Social
Security on or after January 1, 1984 with the
exception of employees who were participants in
CSRS on December 31, 1983.
- All those who are currently subject to CSRS and who
elect to join.
I. BASIC PLAN-
0.85 x high 5 years of salary x years of service.
2~ per year reduction of annuity under age 62.
Can retire with immediate annuity at age 62 with
10 years of service; age 55 with 30 years of
service.
Involuntary retirement age 50 with 20 years of
service, any age and 25 years of service.
Disability and survivor benefits integrated with
Social Security.
Deferred annuity at age 62 for employees with 10
years service who leave prior to retirement
eligibility.
Retains special retirement classes (Law enforcement,
firefighters and air traffic controllers)
-- Age 55 with 25 years of service
-- Age 62 with 10 years of service
-- No reduction under 62
-- Retirement Supplement under 62 equal to Social
Security benefit available at 62.
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Funding
Agency contributes to CSR fund the percentage of pay
necessary to meet the projected cost of benefits. Any
supplemental liabilities to be amortized from Treasury over
30 year period. Agency also pays cost of annuity for dis-
ability retirees under age 62.
Fund for basic plan will be the same as that for CSRS.
OPM pays benefits, must provide life annuity and joint and
survivor annuity along with any other annuity form OPM
desires as long as actuarially equivalent.
Basic pension is adjusted annually in January for the
change in CPI from September-September minus two.
Disability
18 months for vesting
If eligible for Social Security, 60~ of high 5 minus
100 of Social Security benefit from onset of disability to
age 62.
If ineligible for Social Security:
1) Definition tightened resulting in placement of
disabled employee in any job in commuting area for which
qualified within 2 grades of current position.
2) lst year - 60$ of high 5
3) After 1st year - 20~ of high 5 or accrued benefit
based on projected service through age 62, whichever is
lower.
In both cases, accrued benefit after age 62 based on
actual service plus projected service through age 62. Must
have 10 years of actual and projected service.
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Survivor Annuity
A. Preretirement survivor benefits:
1. Benefits payable immediately if the deceased had
at least 18 months service
2. Survivor gets the higher of:
(a) 50 percent of the accrued annuity (computed
as if the worker had retired the day before
death, with any applicable early retirement
reductions, but without the reduction for
survivor benefits) plus any social security
payable,
(b) 25 percent of the worker's high-five average
salary minus any social security family
benefits (not applicable if only benefit
payable is child's insurance benefit).
B. Postretirement survivor benefits: Annuity to married
retiree automatically reduced actuarially as in a 50 percent
joint-and-survivor plan to provide a spouse survivor annuity -
waived with consent of spouse.
1. Survivors eligible for Social Security benefits
get 50 percent of the unreduced annuity
(except for early retirement reduction) plus
any social security payable.
2. Survivors not eligible for Social Security
get the full annuity that was payable to the
retiree (after reductions for early retirement
and survivor benefits) until age 60, when they
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will get 50 percent of the accrued annuity'
after early retirement reductions plus
any social security payable.
Survivors benefits to widows and widowers cease if they
remarry before age 55 (this reflects the provision in the
new Civil Service Retirement Spouse Equity Act of 1984).
Child survivor benefits:
only.
none from plan, social security
Former spouse benefits: Any prior elections or court orders
concerning an annuity for a former spouse must be honored
before payment to a surviving spouse or another former
spouse can be made.
THRIFT/SAVINGS PLAN
Participant may contribute to the fund any amount not
exceeding 10 percent of basic pay.
Contributions will be tax deferred.
Agency shall contribute $2 for every $1 contributed
by employee up to 40 of employee basic pay.
-- Maximum agency contribution will be 80 of pay.
Employee elects category of investment(s) for his
account, receives annual statement of earnings,
annual opportunity to change amount contributed,
category of investment(s).
At retirement may withdraw, rollover in IRA, draw an
annuity or defer.
Upon separation prior to retirement eligibility
may rollover in IRA or qualified employer pension
or leave till age 62 and withdraw or receive an
annuity.
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Investments
1st year - all monies invested in federal securities.
2nd year and beyond - each year a 25~ increment of
employee money to be invested by Board of Trustees in any
federal, state, local or private interest bearing securities,
equities, real estate, etc. Agency money to be invested in
12.5 increments beginning in year 6. After year 4 all
employee money to be invested by board; after year 12, all
agency money.
Thrift Investment Board
Off budget agency.
6 trustees.
Appointed by President, confirmed by Senate.
Executive Director appointed by Board, must have
substantial experience, training or expertise in
the management of financial investments.
All trustees have 7 year appointments except first few
to be graduated.
III. Transition provisions
For current employees to join new system - two options
(also applicable to rehires covered by the plan who have an
unrefunded lump-sum credit from prior service under the
CSRS) .
1) employee contributions to current system will be
matched by government money plus 7$ interest (credited
annually and compounded) from CSRS and transferred to
thrift/savings account of employee. Additionally, credit
under current program will be transferred to credit under new
basic plan.
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2) credit in current program will freeze and employee
may accrue new credit in new program. Service in new program
will count towards eligibility to retire in old. Salar}~ in
new will count towards high 3 in old. However, service in
new program will not accrue for old. Service in old program
will count towards eligibility to retire in new but will not
accrue in new.
Employees hired during interim period will be given
credit for service in basic plan plus 1.3o contribution will
be matched 2 for 1 with a loo interest applied and put in
employees' thrift/savings accounts.
Employee covered by CSRS prior to January 1, 1984 and
covered by Social Security pursuant to Social Security
Amendments of 1983 will contribute difference between OASDI
contribution and normal CSRS contribution to CSRS fund.
Entitled to full CSRS benefit until begins receiving Social
Security payment. CSRS benefit recomputed and reduced by
the amount of the Social Security benefit attributable to
service performed while employee of federal government.
Applies to normal benefit, disability and survivor benefits.
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~~ ~~~-e H /9 SS"'
1[ H79910.087 S.L.C.
99th CQNGRESS
1~t Session ~.
IN THE SENATE OF THE UNITED STATES
Kc. Stevens intcoduc~d the followinS bill; which was read twice
and referred to the Committee on ___w _______~
To amend title 5, United States Co3e, to establish a new
retirement and disability plan for Federal employees, postal
employees, and Kembers of Congress, and for oth~c purpcses.
1 B~ l~ ~II~S~~ hY S.b.g ~~tS s~DSi H4L5s Qf 3~C~~IIS~~ives
2 of S~h~ SIIII~g~ ~z~~~ Qf ~m?ti~a in ~s~nst~~ a~s~m~l~~...
3 That this Act may be cited as the "Civil Service Pension
~ Reform Act of 1985".
5 PURPOSES
6 Sec. 2. The purposes of this Act ace--
7 (1) to provide Federal employees with a retirement
8 benefits plan which is comparable to good private sector
9 retirement benefits plans;
10 (2) to promote financial stability and flexibility
11 for the future of each Federal ettployee;
12 (3) to ensure a fully funded and financially scund
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07991 ~. A 87 S.I.C.
2
1 Federal Government retirement benefits plan;
2 (4) to enhance portability of retirement assets
3 between Federal jobs and fobs outside the Federal
4 Government;
5 (5) to increase the options of each Federal employee
5 with respect to retirement benefits plans;
7 (6) to encourage Federal employees to increase
e personal savings;
9 (7) to include Federal employees in the investment
1S decisionmakin~ process with respect to the assets cf the
11 retirement system; and
12 (8 ) to extend financial protection from disability to
13 additional Federal employees and to increase such
14 protection for eligible Federal employees.
15 TITLE I--CIVIL SERVICE PENSION SXSTE>'S
16 ESTaBLISHKENT
17 Sec. 101. (a) Title 5, United States Cods, is amended by
18 inserting after chapter 83 the following new chapter:
19 ` `CHI~PTER 84--CIVIL SERVICE PENSION SXSTEH
" SUBCHAPTER I--DEFINITIONS; CIVIL SERVICE PENSION SXSTEK
"Sec.
"
8401.
Definiticns.
"
8402.
Civil Service Pension System; participation.
"
8403.
Relationship to the Social Security act.
"
8411.
Entitlement.
"
8412.
Deferred retirement.
"
8413.
Computation of annuity.
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"8414. Reductior. for early retirement.
"8415. Reduction for survivor annuities.
?`8416. Itethods of Payments.
" 8417. Funding.
"SUBCHAPTER III--THRIFT SAVINGS PLAN
" 8421. Contributions.
?`8422. vesting.
" 8423. Entitlement and elections relating to entitlement.
8424. Annuities: methods of payment; election; and
computation.
" 8425. Administrative provisions relating to payments and
elections.
?`8426. Thrift Savings Fund.
" 8427. Investment of Thrift Savings Fund.
" 8428. Accounting.
" SUBCHAPTER IY--SURVIVOR BENEFITS
"8431. Basic plan benefits relating to death of a
participant.
"8432. Basic plan benefits relating to death of a forger
participant.
" 8433. Survivor benefits under the thrift savings plan.
`?8434. Survivor benefits for former spouses: entitlements;
amount .
" 8435. Survivor benfits for former spouses: elections,
deposits and collections, and administrative
provisions.
" 8436. Termination of entitlement.
"SUBCHAPTER Y--DISABILITY BENEFITS
?`8441. Definitions.
" 8442. Entitlement.
" 8443. Computation of benefits.
" 8444. Application.
" 8445. Hedical examinations.
??8446. Offers of alternative employment.
" 8447. Recovery or restoration of earning capacity.
" 8448. Relationship to Workers' compensation.
" 8449. National Guard technicians.
" 8458. Funding.
`'SUBCHAPTER YI--GENERAL AND ADHINZSTRATIYE PROYISION~
" 8451. Responsibilities.
" 8452. Cost-of-living adjustment in basic plan annuities,
survivor annuities, and disability benefits.
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079918.087 S.L.C.
4
"8453. Rate of benefits.
" 8454. Accrual and termination of annuities.
" 8455. Waiver, allotment, and assi4nment of benefits.
" 8456. Application for benefits.
" 8 457 . Court or dscs.
" 8458. Annuities and pay on reemployment.
" SUBCHAPTER YII--TRANSITION PROVISIONS
" 8471 . Elections.
"8472. Transfer participants.
" 8473. Participants retaining entitlement in the Civil
Service Retirement and Disability System.
'8474. Participants hived during temporary adjustment
period .
"8475. Exemption from offset provision of the Social
Security Act.
" 8476. Regulaticns.
" SUBCHAPTER VIII--CIVIL SERVICE THRIFT INVESTIKENT BOARD
" 8491. Establishment; membership.
" 8492. Functions.
" 8493. Powers of the Board.
"8494. Powers of the Executive Director.
" 8495. Administrative provisions.
" 8496. Fiduciary responsibilities; liability and penalty.
1 " SUBCHAPTER I--DEFINITIONS; CIYII. SEFVICE PENSION SYSTEH
2 " S 8401. Definitions
3 " Except as ctherwise provided in this chapter, for the
4 purposes of this ~haptec--
5 _ " t 1) the term `account', when used with respect to a
6 participant cr annuitant, means an account established
7 and maintaine3 under section 8428(a) of this title;
8 " (2) the term `annuitant' means a former participant
9 who is entitlsd to an annuity under this chapter and who
10 has applied under this chapter for the payment of the
11 annuity to begin;
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079910.087 S.I.C.
5
1 " (3) the term 'average pay', when used with respect
2 to a participant, means the largest annual rate resulting
3 from avera9irq the participant's rates of basic pay in
4 effect over any five consecutive years of creditable
5 service oc, in the case of an annuity under this chapter
6 based on service of less than five years, over the total
7 service, with each rate weighted by the time it was in
8 effect;
9 " (4) the term `basic pay', when used with respect to
10 a participant--
11 " (~) means the lesser of--
12 " (i) the basic pay of the participant
13 established pursuant to law, without regard to
14 any provision of law limiting the rate cf pay
15 actually payable in any pay period (including any
15 provision of law restricting the use of
17 apprcpriated funds); or
18 `? (11) the rate of basic pay payable fcr
19 level I of the Executive Schedule; and
20 " (B) includes the items described in
21 subparagraphs (a) through (D) of paragraph (3) of
22 section 8331 of this title and does not include the
23 items excluded by such paragraph;
24 " (5) the teem 'Board' means the Civil Service Thrift
25 Investment Bc3rd established by section 8491(a ) of this
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879910.087 S.I.C.
6
1 title;
2 " (6) the term `Civil Service Retirement and
3 Disability Fund' means the Civil Service Retirement and
4 Disability Fund referred to in section 8348 of this
5 title;
6 " (7) the term `court', When used With respect to a
7 judgment, decree, order, oc other Judicial action, means
6 any court of the United States, a State, the District of
9 Columbia, the Commonwealth of Puerto Rico, or a territory
1a oc possession of the United States, or any Indian court,
11 having jurisdiction to issue such judgment, decree, or
12 order or to take such other judicial action;
13 " t81 the term `Dicect~r' means the Director of the
14 Office of Personnel Ranagement;
15 " (9) the term `dynamic assumptions' means economic
16 assumptions that ace used in determining actuarial costs
17 and liabilities of a retirement system and anticipate the
18 effects of long-term future--
19 ` ` (1~ ) investment yields,
20 " (B) increases in rates of basic pay, and
21 "(C) rates of inflation;
22 " (10) the term `earning', When used With respect to
23 the Thrift Savings Fund, means the amount of the gain
24 realized or yield received from the investment of sums in
25 such fund;
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s. i.c.
1 " (11) the term 'eligible former spouse', When used
2 pith respect to a participant or former pacticiFan?,
3 means a formes spouse of the participant or former
4 participant if--
5 " (A) the participant oc former participant
6 performed at least 18 months of civilian service
7 covered under this chapter as a participant or
8 subchapter III of chapter 83 of this title; anc
9 ?`(B) the former spouse Was married to the
10 participant or former participant for at least 9
11 months;
12 " (12) the term 'employee' means--
13 ??(A) each individual referred to in
14 subparagraphs (A), (E), (F), (H), (I), and (J) of
15 section 8331(1) of this title; and
16 " (B) a Congressional employee as defined in
17 section 2197 of this title, including a temporary
18 Congressional employee;
19 any of Whose service after December 31, 1983, is
20 employment fcc the purposes of title II of the Social
21 Security Act and chapter 21 of the Internal Revenue Code
22 of 1954, except that such term does not include any
23 individual referred to in clause (i), (v), (vi), or (ix)
24 of paragraph (1) of section 8331 of this title or in the
25 undesignated material after clause (ix) of such
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8
1 paragraph, any individual excluded under section
2 8402(b)(2) of this title, or any individual Who was
3 subject to subchapter III of chapter 83 of this title on
4 December 31, 1983, and has not elected to transfer to the
5 System or to ~ommence participation in the System
6 pursuant to section 8471(a) of this title;
7 " (13) the term `Executive Director' means the
8 Executive Director of the Board;
9 ??(14) the term `firefighter' has the same meaning
10 provided in section 8331(21) of this title;
11 `?(15) the term `Fund' means the Civil Service
12 Retirement and Disability Fund;
13 " (16) the term `Government' has the same meaning
14 provided in section 8331(7 ) of this title;
15 ??(17) the term `law enforcement officer' has the
16 same meaning provided in section 8331(28) of this title;
17 " (18) the term loss', when used with respect to the
18 Thrift Savings Furd, means the amount of the loss
19 realized from the investment of sums in such fund;
20 ?' (19) the term `lump-sum credit' has the same
21 meaning as provided by section 8331(8) of this title;
22 " (20) the term 'Kember' has the same meaning as
23 provided by section 2106 of this title, except that such
24 term does not include a Member who was subject to
25 subchapter III of chapter 83 of this title on December
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07991PJ.e87 S.I.C.
9
1 31, 1983, and has not elected to transfer to the System
2 or to commence participation in the System pursuant to
3 section 8471(a) of this title;
4 " (21) the term 'net earnings' means the excess of
5 earnings over losses;
6 ~ " (22) the term `net losses' means the excess cf
7 losses over earnings;
8 " (23L the term 'normal cost', When used with respect
9 to an annuity of a participant, means the entry-age
10 normal cost of the annuity, computed by the Office in
11 accordance with generally accepted actuarial practice and
12 standards (using dynamic assumptions) and expressed as a
13 level percentage of the basic pay of the participant;
14 ' ` (24) the term `Office' means the Office of
15 Personnel ~1an3gement;
16 " t25) the teem 'participant' means an employee or
17 [ember ;
16 " (26) the term 'price index' has the same meaning as
19 provided in section 8331(15) of this title;
20 " (27) the term `service', when used with respect to
21 a participant or former participant, means employment of
22 the participant or former participant (while a
23 participant) that would be creditable under sectior. 8332
24 of this title if the participant or annuitant were
25 subject to subchapter III of chapter 83 of this title
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079910.887 S.I.C.
10
1 instead of this chapter (and is not credited for tre
2 purposes of the application of such subchapter to the
3 participant cr former participant);
4 " (28) the term 'supplemental liability', when used
5 with respect to a fiscal year, means the estimated excess
6 o f --
" (~1) the sum of--
" (i) the present value of all benefit
payable from the Fund after such fiscal year to
participants and former participants, and to
their survivors, under this chapter, computed in
accordance with generally accepted actuarial
practice and standards (using dynamic
assunptions),
" (11) the excess of the amount of the
administrative expenses incurred by the office in
carrying out this chapter during such fiscal year
over the amount of the administrative expenses
estimated for such fiscal year for the purposes
of clause (111) of this paragraph at the end of
the preceding fiscal year; and
" (lii) the es*_imated amount of the
administrative expenses that the Office will
incur in carrying out this chapter during the
ensuing fiscal year; over
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07991 x.987 S.I.C.
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" ( B ) the sum of--
" (i) the total amount of the contributions
made an behalf of participants pursuant to
section 8417 (a) of this title;
" (li) the present value of the contributions
to be made on behalf of participants pursuant to
such section 8417 (a) ;
" (iii) the amount of the net earnings from
investment of sums contributed on behalf of
participants pursuant to such section e417(a);
11 and
" (iv) the present value of the amount of the
net earnings expected to he realized from
investment of sums contributed on behalf of
participants pursuant to such section 8417(a);
16 and
17 " (29) the term 'System' means the Civil Service
18 Pension System described in section 8492(a) of this
19 title.
20 " S 8402. Civil Service Pension System; participation
21 " (a) The provisions of this chapter comprise the Civil
22 Service Pension System.
23 " (b)(1) Except as provided in paragraph (2) of this
24 subsection, each employee and tiember shall be a participant
25 in the System.
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879910.887 S.L.C.
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1 " (2)(A) The Office may exclude from the operation of
2 this chapter an employee or group of employees in or urdec an
3 Executive agency Whose employment is temporary or
4 intermittent, except an employee who occupies a position as
5 part-time career employment (as defined in section 3481(2) of
6 this title).
7 " (B) The architect of the Capitol may exclude frort the
operation of this chapter an employee under the Office of the
Architect of the Capitol whose employment is temporary or of
uncertain duration.
" (C) The Librarian of Congress may exclude from tre
operation of this chapter an employee under the Library of
13 Congress whose employment
14 duration.
is temporary or of uncertain
15 " S 8403. Relationship to the Social Security Act
16 " Except as otherwise provided in this chapter, the
17 benefits payable under the System are in addition tc the
18 benefits payable under the Social Security Act.
" SQBCHAPTER II--BASIC PLAN
20 " S 8 411 . Entitlement
21 " (a) An employee or a Kember who is separated from
22 employment by the Federal Government after becoming 55 years
23 of age and completing 38 years of service is entitled to an
24 immediate annuity.
25 `?(b) An employee or a Member who is separated from
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1 employment by the Federal Government after becoming 62 years
2 of age and completing 10 years of service is entitled to an
3 immediate annuity.
4 " (c) An employee Who is separated from employment by the
5 Federal Government after becoming 55 years of age and
6 completing 25 years of service as a laW enforcement officer
7 or firefighter, cc any combination of such service totaling
e at least 25 years, is entitled to an immediate annuity.
9 " (d) An employee Who is separated from employment by the
10 Federal Government after becoming 55 years of age and
11 completing 25 years as an air traffic controller is entitled
12 to an immediate annuity.
13 " (E)(1) For the purposes of this subsection--
14 ?`(A) the term `military technician' means a member
15 of the reserve components of the Armed Forces Who is
16 assigned to a civilian position as a technican in the
17 administration and training of the reserve ~omponer.ts of
18 the Armed Forces or the maintenance and repair cf
19 supplies issued to the reserve components of the Armed
20 Forces; and
21 " (B) the term `reserve components of the Armed
22 Forces' means the reserve components of the Armed Forces
23 specified in section 261(a) of title 1g.
24 " (2) A military technician Who is separated from
25 employment by the Federal Government after becoming 55 years
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079910.087 S.L.C.
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1 of age and completing 30 years of service is entitled to an
2 immediate annuity.
3 " (f)(1) Except as provided in paragraph (2) of this
4 subsection, any employee who has completed 25 years of
5 service, br is nct less than 50 years of age and has
6 completed 20 years of service, and who--
7 " (a) is separated from employment by the Federal
8 Government involuntarily, except by removal for cause on
9 charges of misconduct or delinquency; or
10 " (E) while serving in a geographic area deslgrated
11 by the Director, is voluntarily separated from employment
12 by the Federal Government during a period that--
13 " (i) the agency in which the employee is secvina
14 is undergoing a majcr reorganization, a ma~cr
15 reduction in force, or a major transfer of function;
16 and
17 "(li) a significant percentage of the total
18 number of employees serving in such agency will be
19 separated or subject to an immediate reduction in the
28 rate of basic pay (without regard to subchapter YI of
21 chapter 53 of this title or comparable provisicns);
22 as determined by the Director, is entitled to an immediate
23 annuity.
24 " (2 ) An employee described in paragraph (1) (~1) of this
25 subsectlon is not entitled to an annuity under this
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1 subsection if the employee has declined a reasonable offer of
2 another positicn in the employee's agency for Which the
3 employee is qualified and the offered position is not lower
4 than two grades (or pay levels) below the employee's grade
5 (or pay level) and is within the employee's commuting area.
6 " (q) An annuity authorized by this section is computed
7 under sections 8413 through 8415 of this title.
B "S 8412. Defecr?d retirement
9 " (a) A participant who is under 62 years of age ar.d
10 separates from ert~ployment by the Federal Government of ter
11 completing 1? years of civilian service is entitled to an
12 annuity beginning on the date the participant becomes 62
13 years of age.
14 " (b) An annuity authorized by this section is computed
15 under sections 8413 through 8415 of this title.
16 "S 8413. Computation of annuity
17 ` ` (a) ( 1) Except as provided in section 8414 or 841 ~ of
18 this title, the amount of the annuity a former participant is
19 entitled to receive under this subchapter shall be equal to
2a the product of 0.85 percent of the former participant's
21 average pay (while serving as an employee or liember)
22 multiplied by the participant's total service.
23 " (2) For the purposes of computing the amount of an
24 annuity under par3graph (~) of this subsection, the total
25 service of a participant who separates from employment by the
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1 Federal Government entitled to an immediate annuity or Who
2 dies leaving a survivor or survivors entitled to a survivor
3 annuity includes the days of unused sick leave credited to
4 the participant under a formal leave system.
5 " (b)(1) Except as provided in section 8415 of this
6 title, a former participant Who is entitled to receive an
7 annuity under subsection (c) oc (d) of section 8411 of this
8 title and is under 62 years of age on the date the annuity
9 commences shall be entitled to receive an annuity supplement,
10 in addition to the amount of the annuity computed under
11 subsection (a) of this section, chile under such age.
12 " (2) The amount of the annuity supplement payable to a
13 former participant under paragraph (1) of this subsection
14 shall be equal to the amount of the benefits that--
15 " (A) the former participant Would be entitled to
16 receive under title II of the Social Security Act if the
17 participant Were 62 years of age on the date the annuity
18 referred to in such paragraph commences; and
19 "(B) is attributable to service referred to ir.
20 section 8411 (c), 8411(d), or 8411(e) of this title, as
21 applicable,
22 increased as provided in paragraph (3) of this subsection.
23 " (3) Effective on January 1 of each year, the amount of
24 the annuity supplement computed under par3graph (2) of this
25 subsection shall be increased by the percent increase, if
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1 any, in the SSA average wage index (as defined. in section
2 215(i)(1)(G) of the Social Security Act) published for
3 November of the preceding year over such index published for
4 November of the next preceding year.
5 "S 8414. Reduction for early retirement
6 " (a) The annuity computed under section 8413(a) of this
7 title (without regard to this section or section eu15 cf this
8 title)--
g ? ? (1) for a participant who is separating from
10 - employment by the Federal Government entitled to ar
11 immediate annuity, other than a participant referred to
12 in paragraph (2) of this section, shall be reduced by
13 one-sixth of one percent for each full month the
14 participant is under 62 years of age on the date of
15 separation; and
16 ` ` (2 ) for ~a participant who is separating from
17 employment by the Federal Government entitled to an
18 immediate annuity under section 8411 (f) of this title and
19 who--
20 " (A) has been a law enforcement officer,
21 iirefightsr, or air traffic controller for the years
22 of service qualifying the participant for an
23 immediate annuity under such section 8411(f), cr
24 " (B) is a military technician (as defined in
25 section 8411(e)(1)(A) of this title) when separated,
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1 shall be reduced by one-sixth of one percent for each
2 full month the participant is under 55 years of aQe on
3 the date of separation.
4 "S 8415. Reduction for survivor annuities
5 " (a) The annuity of a former participant computed under
6 section 8413 of this title (includlnq an annuity supFlement
7 computed under subsection (b) of such section) and, if
e appropriate, under section 8414 of this title shall be
9 reduced by the appropriate amount such that the total amount
13 of the retirement benefits expected to be payable to the
11 former participant under this subchapter and all survivor
12 benefits expected to be payable With respect to the former
13 participant pursuant to sections 8432 and 8434 of this title
14 is equal to the total amount of the retirement benefits that
15 Would be expected to be payable under this subchapter to the
16 former participant pursuant to the method referred to in
17 section 8416(b)( 1) of this title, determined in accordance
16 With generally accepted actuarial principles and standards.
19 " (b) a reduction in the annuity of a former participant
20 pursuant to subsection (a) of this section shall be adjusted,
21 as appropriate tc carry out such subsection, to reflect any
22 election made pursuant to subsection (b), (c), or (d) cf
23 section 8435 of this title.
24 '~' S 8416. >methods of Payment
25 " (a) ( 1) The Office shall prescribe methods of payaent of
26 annuities under this subchapter.
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1 " (2) The Office shall include among the methods of
2 payment prescribed under paragraph (1) of this subsection--
3 " (~-) a method providing for the payment of a monthly
4 annuity only to a former participant entitled tc the
5 annuity during the life of the former participant; and
6 " (B) a method providing for the payment of a monthly
7 annuity for the point lives of a former participant and
8 the spouse of the former participant and the life cf the
9 one of them Who survives the other of them.
10 " (b) Subject to section 8432 of this title--,
11 " (1) under such regulations as the Office shall
12 prescribe, each former participant shall elect ane of the
13 methods of payment prescribed by the Office under
14 subsection (a) of this section; and
15 " (2) the annuity of the former participant under
16 this subchapter shall be paid in accordance With the
17 method of payment elected by the former participant
18 pursuant to paragraph (1) of this subsection.
19 "S 8417. Funding
20 ' ` (a) ( 1) The employing agency of a participant sha 11
21 contribute to the Fund for each participant employed by the
22 agency an amount equal to the normal cost of an annuity under
23 this subchapter for such participant.
24 " (2) The contribution required by.paragcaph. (1) of this
25 subsection to be made for a participant shall be made from
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1 the appropriation or fund used to pay the participant, or, in
2 the case of an elected participant, from an appropriation or
3 f and available fcr payment of other salaries of the office oc
4 establishment of the participant. In the case of a
5 participant in the legislative branch vho is paid by the
6 Clerk of the House of Representatives, contributions f cr the
7 benefit of such participant shall be paid from the contingent
8 fund of the House of Representatives.
9 " (b) ( 1) The Office of shall compute--
10 " (~1) the amount of the supplemental liability of the
11 Fund pelatin9 to participants and former participants
12 other than participants and former participants referred
13 to in subparagraph (B) of this paragraph, and
14 " (B) the amount of the supplemental liability cf the
15 Furd relating to participants and former participants Who
16 are active or retired officers or employees of the United
17 States Postal Service,
18 as of the close cf each fiscal year beginning after September
19 30, 1985.
20 " (2) The amounts of any supplemental liability--
21 " (a) computed pursuant to paragraph (1) (a) of this
22 subsection With respect to participants and former
23
participants referred to in such paragraph (1) (a) of
24 this subsection, and
25 " (B) computed pursuant to paragraph (1) (B) of this
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1 subsection with respect tc participants and forcrer
2 participants referred to in such paragraph (1) (B),
3 shall each be amcrtized in thirty annual installments.
4 " (3) At the end of each fiscal year, the Office st~.all
5 notify--
6 " (A ) the Secretary of the Treasury of the amount of
7 the annual installment computed under paragraph (2) (A)
8 of this subsection for such fiscal year, and
g " (B) the Postmaster General of the United States of
10 the amount of the annual installment computed pursuant to
11 paragraph (2) (B) of this subsection for such fiscal
12 year.
13 ?? (4)(A) Befcce closing the accounts for a fiscal year,
14 the Secretary of the Treasury shall credit the amount cf the
15 annual installment computed for such fiscal year pursuant to
16 paragraph (2) (A) to the Fund, as a Government contribution,
17 out of any money in the Treasury of the United States r.et
18 otherwise appropriated.
19 " (B) Upon receiving a notice required by paragrapr (3)
20 (B) of this subsection, the United States Postal Service
21 shall pay the amcunt of the annual installment specified in
22 the notice. The amount paid sh311 be credited to the Fund.
23 " SUBCHAPTER III--THRIFT SAVIPGS PLAR
24 ?`S 8421. Contributions
25 " (a)(1) Each participant may contribute to the Thrift
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1 Savings Fund in any fiscal year any amount not exceedir.o ten
2 percent of the participant's annual rate of basic pay.
3 " (2) Each former participant receiving disability
4 benefits under subchapter Y of this chapter may, until
5 becoming 62 years of age, ccntribute to the Thrift Savings
6 Fund in any fiscal year any amount not exceeding ten percent
7 of the amount of the former participant's disability benefits
8 payable under such subchapter during such fiscal year.
9 " (3) any contribution under this subsection shall be
10 made only pursuant to a program of regular contributions *_o
11 be made at the end of each pay period of the participant, or
12 at the end of each disability benefits payment period in the
13 case of a disabled former participant, under such regulations
14 as the 3oard shall prescribe.
15 ' ` (4) lit least once each year, a participant or former
16 participant may modify the amount contributed pursuant to
17 paragraph (1) or (2) of this subsection, as the case may be.
18 " (b) The employing agency of a participant Who
19 contributes to the Thrift Savings Fund under subsectior. (a)
20 of this section for any pay period, or, in the case of a
21 disabled former participant Who contributes to such fund
22 under such subsection for any disability benefits payment
23 period, the emplcyinq agency of the former participant on the
24 date of onset of the disability, shall contribute to tre
25 Thrift Savings Fund for the benefit of such participant or
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1 disabled former participant at the end of such period an
2 amount equal to twice such portion of the amount of the
3 contribution of the participant or former participant as does
4 not exceed four percent of the amount of the gross pay or
5 gross disability benefits, as the case may be, payable for
6 such period.
7 " (c) The sums required to be contributed to the Thrift
8 Savings Fund by an employing agency under subsection (b) of
9 this section for the benefit of a participant or disabled
10 former participant shall be paid from the appropriations or
11 funds available *_o such agency to pay the basic pav of
12 participants or, in the case of an elected participant, from
13 an appropriation or fund available for payment of other
14 salaries of the participant's office or establishment. In the
15 case of a participant in the legislative branch rho is paid
16 by the Clerk of the House of Representatives, contributions
17 for the benefit cf such participant shall be paid from the
18 contingent fund cf the House of Representatives.
19 " (d) For purposes of the Internal Revenue Code of 1954--
2e ``(1) any amount of the participant's pay Rhicr is
21 contributed to the Thrift Savings Fund and the amount of
22 the employing agency's matching contributions shall not
23 De included in the gross income of the participant, and
24 " (2) the Thrift Savings Fund shall be treated, for
25 purposes of determining Shen amounts in such Fund are
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1 included in the income of any participant, as described
2 in section 401(a) of such Code.
3 ??S 8422. Vesting
4 ??(3)(1) A participant Who separates from employment by
5 the Government shall be entitled to an amount equal to--
6 `?(A) the sum of the total amount of the
7 contributions made under section 8421(a) of this title
e and the total amount of the net earnings in the Thrift
9 Savings Fund attributable to such contributions; ar.d
1a ? ? (B ) the applicable percentage of the sum of the
11 total amount contributed to the Thrift Savings Fund for
12 the benefit cf the participant under section 84210) of
13 this title and the total amount of the net earnings in
14 the Thrift Savings Fund attributable to such
15 contributions, as provided in subsection (b) of this
16 section.
17 ??(2) The amount to Which a participant is entitled under
16 paragraph ( 1) of this subsection shall be payable in
19 accordance With the election made by the participant pursuant
20 to section 8423 cf this title.
21 ? ` (b) ( 1) For the purpose of subsection ( a) (1) (B ) o f this
22 section, except as provided in paragraph (2) of this
23 subsection, the applicable percentage for a participant
24 separating from employment by the Government after having
25 been a participant in the System for a period set forth under
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1 column I of the table below is the percentage set forte under
2 column II of the table below opposite the description cf such
3 period:
? ? ~SIyIDII ~ ~4~1i~ Z1
Period for Which the participant has 1pplicable
been a Participant in the System: percentage:
Less thar. 2 years B
Not less than 2 years, but less than 3 years. 25?
Not less than 3 years, but less than 4 years. 50
Not less than 4 years, but less than 5 years. 75
Not less than 5 years 1AB.
4 `?(2) For the purposes cf subsection (a)(1)(B) of this
5 section, the percentage applicable in the case of any
6 participant Who dies While employed by the Government shall
7 be 10B percent.
8 " S 8423. Entitlement and elections relating to entitlement
9 " (a) any participant Who separates from employment by
10 the Government entitled to an immediate annuity under section
11 8411 of this title is en titled and may elect--
12 " (1) to receive an immediate annuity from the Thrif t
13 Savings Fund;
14 " (2) to defer the commencement of the payment of an
15 annuity from the Thrift Savings Fund until such date as
16 the participant specifies;
17 " (3) to Withdraw, in one payment, the amount cf the
18 balance credited to the participant's account in the
19 Thrift Savings Fund as cf such date; or
20 ?`(4) to transfer the amount of the balance in the
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1 account to an individual retirement account or cther
2 qualified plan (within the meaning of the Internal
3 Revenue Code of 1954) of the participant.
4 " (b) Subject to section 8425(d) of this title, any
5 participant who separates from employment by the Government
6 before becoming entitled to an immediate annuity under
7 section 84 t 1 of this title is entitled and may elect--
e " (1) to receive an annuity from the Thrift Savings
9 Fund commencing when the participant becomes 62 years of
18 age;
11 " (2) to withdraw, in one payment, the amount cf the
12 balance credited to the participant's account in the
13 Thrift Sa~tings Funds (subject to the limitations set out
14 in section 8422(a)(1) of this title), payable when the
15 participant becomes 62 years of age; or
16 " (3) to transfer such amount to an individual
17 retirement account oc other qualified plan (within the
18 meaning of the Internal Revenue Code of 1954) of tre
19 participant.
20 " (c) ( 1) Subject to paragraph (2) of this subsecticn, any
21 participant making an election pursuant to subsection (a)(2)
22 of this section may modify the date specified in the
23 election.
24 "(2) any modification under paragraph (1) of this
25 subsection may not specify a date for the commencement of
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1 annuity payments earlier than one month after the date such
2 modification is filed with the Board.
3 " (d)(1) Notwithstanding any other provision of this
4 section, except as provided in paragraph (2) of this
5 subsection, a participant who has transfFrred to the System
5 under section 8471(a)(1) of this title shall not be entitled
7 to receive benefits under this section, other than ar,
e immediate annuity under subsection (a)(1) of this section or
9 a deferred annuity under subsection (b)(1) of this section,
10 before the date five years after the date the participant
11 commenced participation in the System.
12 " (2 ) Paragraph (1) of this subsection shall not apply in
13 the case of a deceased participant or a person who is
14 disabled for the purposes of subchapter V of this title.
15 " S 8424. annuities: methods of payment; election; and
16 computation
17 " (a) (1) The Board shall prescribe methods of payment of
18 annuities under this subchapter.
19 ` ` (2 ) The Board shall include among the methods of
20 payment prescribed under paragraph (1) of this subsection--
21 " (~) a method providing far the payment of a nonthly
22 annuity only to a former participant during the life of
23 the former pacticipa,nt;
24 " (B) a method providing for the payment of a monthly
25 annuity for the point lives of a former participant and
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1 the spouse of the former participant and the life cf the
2 one of them ~-ho survives the other of them;
3 " (C) a method described in subparagraph (a) of this
4 paragraph prcviding for annual increases. in the amcunt of
5 the annuity F3yable; and
6 " (D) a method described in subparagraph (B) of this
7 paragraph prcviding for annual increases in the amcunt of
8 the annuity payable.
9 " (b) Under such regulations as the Board shall
10 prescribe, each former participant electing under section
11 8423 (b) of this title to receive an annuity from the thrift
12 Savings Fund shall elect one of the metho3s of payment
13 prescribed by the Board under subsection (a) of this section.
14 ` ` (c) ( 1) Subject to paragraph (2 ) of this subsection, the
15 amount of the annuity payable under this subchapter to a
16 former participant pursuant to the method elected under
17 subsection (b) of this section shall be determined, as of the
18 date on Khich the payment of the annuity under the elected
19 method commences, in accordance With generally accepted
20 actuarial principles and standards based on the balance in
21 the annuitant's account on such date.
22 " (2) The tot31 amount of all retirement benefits
23 expected to be payable to a former participant under this
24 subchapter and all survivor benefits expected .to be payable
25 With respect to the former participant pursuant to an
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1 election cnadE under subsection (b) of this section and
2 pursuant to section 8434 of this *_itle shall be equal to the
3 total amount of the retirement benefits that Would be
4 expected to be payable under this subchapter to the former
5 participant pursuant to the method referred to in subsection
6 (a)(2)(A) of this section, determined in accordance With
7 generally accepted actuarial principles and standards.
g ? ` (3) The amount of the annuity payable to a former
9 participant under this subchapter shall be redetermined if--
10 " (A) an individual entitled to a survivor annuity
11 pursuant to an election made under subsection (c) cf this
12 section or pursuant to section 8434 of this title dies or
13 loses the entitlement to the survivor annuity; oc
14 " (B) the former participant makes an election
15 pursuant to section 8435 of this title.
16 " (d) At the end of each fiscal year, the investment
17 experience relating to the account of each annuitant ir. the
18 Thrift Savings Fund shall be compared to the actuarial
19 assumptions that Were used to compute the amount of the
29 annuity payable from the Thrift Savings Fund to the annuitant
21 under this subchapter during such fiscal year. IInder
22 regulations issued by the Board, the excess of the amount of
23 the return, if any, over the amount of the assumed return
24 shall be used to purchase an additional annuity payable from
25 the Thrift Savings Fund. The amcunt of the additional annuity
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1 shall be computed by the Board in accordance with generally
2 accepted actuarial principles and standards.
3 "S 8425. ?administrative provisions relating to payments and
4 el e~tions
5 " (a) The Board shall make payments and transfers ir.
6 accordance with an election of a participant under section
7 8423 oc 8424(b) of this title.
8 " (b) any election under section 8423 oc 8424 of tris
9 title shall be in writing and shall be filed with the Poard
1B in accordance with such rules as the Board may prescribe.
11 " (c) laotwithstanding any other provision of this
12 section, a~ election or modification of an election under any
13 provision of this subchapter shall not be effective if the
14 election oc modification would result in a violation of the
15 terms of an applicable ceurt decree of divorce, annulment, or
tb legal separation, oc the terms of any court order or ccurt-
17 approved property settlement agreement incident to a ccurt
18 decree of divorce, annulment, or legal separation, as
19 determined by the Executive Director.
2B ``(d)(1) ~ participant may make an election authorized by
21 paragraph ( 2 > or ( 3 ) of section 8423 (b) of this title- -
22 " (~) only if the spouse and each eligible focRer
23 spouse of the participant are notified of the
24 participant's election; and
25 " (B) in any case in which there is an eligible
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former spouse, shall be sub)ect to the terms of a court
order or decree issued with respect to such former spouse
" (i) the order or decree expressly relate ~ to
any portion of the
"(ii) payment
the election would
former spouse to a
8434 of this title
under section 8457
amount involved, and
of the amount in accordance with
extinguish entitlement of the
survivor annuity under section
or to any portion of an annuity
of this title .
11 " (2)(A) rot ification of a spouse or eligible former
12 spouse under this subsection shall be made in accordance with
13 such requirements as the Board shall by regulation prescribe.
14 " (B) Dnder the regulations, the Board may provide that
15 paragraph (1)(A) of this subsection may be waived with
16 respect to a spouse or eligible former spouse if the
17 participant establishes to the satisfaction of the Board that
18 the location of such spouse or former spouse cannot be
19 determined.
20 " (3) The Board shall prescribe regulations under Which
21 this subsection shall be applied in any case in which the
22 Office receives two or more applicable court orders or
23 decrees.
24 " S 8426. Thrift Savings Fund
25 " (a) There is established in the Treasury of the United
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1 States a Thrift Savings Fund.
2 " (b) The Thrift Savings Fund consists of the sum cf all
3 amounts contributed under section 8421 of this title
4 increased by the total net earnings from investments of sums
5 in the Thrift Savings Fund or reduced by the total net losses
5 from investments of the Thrift Savings Fund.
7 " (c) The sums in the Thrift Savings Fund ace
e appropriated and shall remain available without fiscal year
9 limitation--
1a ' ` (1 ) to invest under section 842? of this title;
11 " (2) to pay benefits under this subchapter;
12 ` ` (3 ) to pay the administrative expenses of th e
13 Board; and
14 ` ` (4 ) to ~aake loans to participants as provide c in
15 subsection (e) of this section.
16 " (d) ( 1) Except as provided in paragraph ( 2 ) of this
17 subsection, sums in the Thrift Savings Fund are not subject
18 to execution, levy, attachment, garnishment, oc other legal
19 process.
2g " (2) Koneys due or payable from the Thrift Savings Fund
21- to any individual shall be sub)ect to legal process for the
22 enforcement of the individual's legal obligations tc provide
23 child support or make alimony payments as provided in section
24 459 of the Social Security act (42 U.S.C. 659).
25 " (e) Under such regulations as the Board shall
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1 prescribe, the Bcacd may make loans from the Thrift Savings
2 Fund to a participant in case of hardship.
3 " (f) The sums in the Thrift Savings Fund shall not be
4 appropriated and may not be used for any purpose other than
5 the purposes specified in this section.
6 ' ` S 8427 . Investment of Thrift Savings Fund
7 " (a) Subject to subsections (b), (c), and (d) of this
e section, the Board--
9 " (1) may invest the sums available in the Thrift
1a Savings Fund for investment--
11 " (k) in interest-bearing securities of the
12 United States Government;
13 " (B ) in interest-bearing securities of any State
14 ~ or a political subdivision thereof;
15 "(C) in interest-bearing or equity securities of
16 any private business concern;
17 " (D) in teal estate; and
18 " (E) in any other assets the Roard considers
19 appropriate; and
20 " (2) shall determine the appropriate distribution of
21 investments among the assets listed under paragrapr (1)
22 of this subsection.
23 " (b)(1) Except as proviced in subsection (c) or (c) of
24 this section, once each year, a participant or former
25 participant may elect the general type or types of
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1 investments, as designated by the Board under section
2 8492(a)(2) of this title, into Which the Board shall invest
3 sums in the Fund credited to the account of such participant
4 or former participant and the distribution of such sums among
5 the types of investments elected.
.6 " (2) The election of a participant or former participant
7 under paragraph (1) of this subsection shall be made ir.
8 accordance With rules prescribed by the Board and Within such
9 period aftAr the date the participant's oc former
10 participant's annual statement is transmitted to the
11 participant or former participant pursuant to section 8428(c)
12 of this title as the Board shall prescribe in such rules.
13 " (c) (1) lit the end of the first calendar month during
14 Which title I of the Civil Service Pension Reform pct cf 1985
15 takes effect, the amounts ccntributed by a participant to the
16 Thrift Savings Fund under section 8421(a) of this title and
17 the amounts contributed to such fund for the benefit of such
18 participant under section 8421(b) of this title shall be
1~ invested in interest bearing securities of the United States
20 Government.
21 "x(2)(]1) The Board shall invest a percentage of the total
22 amount that--
23 " (i) is contributed to the Thrift Savings Fund by a
24 participant under section 8u21(a) of this title during a
25 month described under column I of the table of
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1 distribution of investments set out in subparagraph (B)
2 of this paragraph, and
" (ii) is available for investment,
4 in interest-bearing securities of the United States
5 Government, as specified under column II of the table
6 opposite the description of such month.
7 " (R) Foc the purposes of subparagraph (t) of this
e paragraph, the table of distribution of investments is as
9 folloWS:
? ? ~l1iIDQ I
Number of the month
after the month des-
cribed in paragraph
(1) of this
subsection:
S~slslIDO I~
>'iinimum percentage
of the contribu-
tions made by
a participant for
the month to
be invested in
United States
Government
securities
1
through
12
100
13
through
24
75
25
through
36
50
37
through
48
25.
10 "(3)(~) :he Board shall
11 amount that--
" (i) is contributed
invest a percentage of the total
to the Thrift Savings Fund by
the Government for the benefit of a participant pursuant
to section 8421(b) of this title during a month described
under column I of the table of distribution of
investments sst out in subparagraph (B) of this
paragraph, and
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1 " (ii) is available for investment,
2 in interest-bearing securities of the United States
3 Government, as specified under column II of the table
4 opposite the description of such month.
5 ` ` (B) For the purposes of subparagraph (~1) of this
6 paragraph, the table of distribution of investments is as
7 folloWS:
Number of the month
after the month des-
cribed in paragraph
(1) of this
subsection:
column u
xinimum percentage
of the contribu-
tions made for
the benefit of
a participant for
the month to
be invested in
United States
Government
securities:
1
through
60
100
61
through
72
87.5
73
through
84
75
85
through
36
62.5
97
through
108
5g
1B9
through
120
37.5
121
through
132
25
133
through
144
12.5
8 "(4) all sums credited to the Thrift Savings Fund
9 pursuant to section 8472(a) or 8474(b> of this title shall be
1e invested in inter?st-bearing securities of the United States
11 Government.
12 " (5) The sum; invested in interest-bearing secuci ties of
13 the United States Government as required by this subsection
14 and returned to the Thrift Savings Fund after maturity of the
15 securities, and the amounts earned on the investment of such
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1 sums, shall be reinvested in interest-bearing securities of
2 the Onited States Government.
3 " (d) In investing sums in the Thrift Savings Fund in
4 equity securities of private businesses the Board shall not
5 acquire such an extensive ownership interest in any private
6 business that the Board, Without the concurrence of other
7 owners of the private business, can elect any officer cf the
6 private business or require the adoption of any policy for
9 the management of the private business.
10 "S 8428. Accounting
11 " (a)(1) The Board shall establish and maintain an
12 account for each participant making contributions under
13 section 8421(a) cf this title.
14 ` ` (2 ) The balance in the account of a participant cr
15 former participant at any time is the excess of--
16 ' ' (A ) the sum of --
17 " (i) all contributions made to the Thrift
18 Savings Fund by the participant or former participant
19 under section 8421(a) of this title;
20 " (ii) all contributions made to such fund for
21 the benefit of the participant or former participant
22 under section 8421(b) of this title;
23 "(iii) the amounts transferred from such fund
24 With respect to the participant or former participant
25 under section 8472(a) or 8474(b) of this title; and
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1 " (iv) the total amount of the allocaticns made
2 to and reductions made in the account pursuant to
3 paragraph (3) of this section, over
4 " (B) the amounts paid With respect to such
5 participant under sections 8411, 8412, 8433, and 8434 of
6 this title.
7 " (3 ) Pursuant to rules prescribed by the Board, t>re
e Board shall allocate to the credit of the account of each
9 participant or former participant an amount equal to a pro
10 rata share of the net earnings and net losses from each
11 investment of suns in the Thrift Savings Fund attributable to
12 sums credited to the account of such participant, reduced by
13 an appropriate share of--
14 " (~) the administrative expensAs of the Board, and
15 " (B) any amount reserved by the Board to pay
16 underfunded annuities,
17 as determined by the Board.
~e " (b) Each Amploying a4ency shall report to the Board at
19 the end of each nonth all amounts contributed by or for the
2a benefit of each participant during such month under section
21 8421(b ) of this title. ?
22 ? ` (c) The Board shall provide each participant and former
23 participant an annual statement of the balance in the
24 participant's oc former participant's account.
25 " SOBCH~PTER IY--SIIRYIYOR BEREFITS
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1 " S 8431. Basic plan benefits relating to death of a
2 participant
3 ` ` (a ) If a participant dies of ter performing eighteen
4 months of service and before separating from employment by
5 the Government, death benefits shall be paid as provided in
6 this section.
7 " (b) Except as provided in subsection (c) of this
8 section, the surviving spouse of a deceased participant
9 referred to in subsection (a) of this section shall be
10 entitled to a survivor annuity equal to the higher cf--
11 " (1) the amount equal to 50 percent of the ar.ruity
12 computed With respect to the deceased participant
13 pursuant to sections 8413 and 8414 of this title as if
14 the participant had retired from employment by the
15 Government entitled to an immediate annuity under section
16 8411 of this title on the day before the date of death of
17 the participant; or
18 " (2) the amount equal to the excess, if any, cf--
19 " (l~) the amount equal to 25 percent of the
20 average pay of the deceased participant, over
21 " (B) the sum of--
22 " (i) the amount of the benefits, if acy,
23 that, by reason of the death of the participant
24 and based on the service of the participant, are
25 payable pursuant to subsection (e), (f), or (9)
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1 of section 202 of the Social SPcucity act (or
2 that, but for a failure to file an application
3 referred to in such subsection, would be payable
4 pursuant to such subsection) to the surviving
5 spouse; and
6 "(i1) if benefits referred to in clause (i)
7 of this subparagraph ace or would be payable to
e the surviving spouse, the amount of the berefits,
9 if any, that, by reason of the death of the
1S participant and based on the service of the
11 ~ participant, ace payable pursuant to secticn
12 202 (d) of such act (or that, but for a failure to
13 file an application referred to in such section
14 202(d), would be payable pursuant to such section
15 202(d)) to the deceased participant's children,
16 if any, who are in the care of the surviving
17 spouse.
18 " (c) The amount of the survivor annuity payable under
19 this section to the surviving spouse of a deceased
20 participant shall be equal tc the excess, if any, of tre
21 amount of the survivor annuity which would be payable to the
22 surviving spouse under this section without regard to this
23 subsection over the total amount of the survivor annuity or
24 survivor annuities payable pursuant to section 8434 of this
25 title to an eligible former spouse or eligible former spouses
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41
1 of the deceased former participant.
2 "S 8432. Basic plan benefits relating to death of a fcrmer
3 participant
4 " (a) For the purposes of this section the term 'deceased
5 former participant's annuity' means--
6 " (1) the annuity the deceased former participant was
7 entitled to receive under section 8411 of this title on
8 the day before the date of the former participant's
9 death; or
10 " (2) in the case of a former participant who died
11 entitled to a deferred annuity under section 8412 cf this
12 title before payment of the annuity commenced, the
13 annuity the deceased former participant would have been
14 entitled to receive under such section if the deceased
15 former participant had been 62 years of age on the day
16 before the date of death.
17 " (b)(1) Except as provided in paragraph (2) of this
18 subsection, the surviving spouse of a former participant who
19 dies after terminating emplcyment entitled to an immediate oc
20 deferred annuity under subchapter II of this chapter shall be
21 entitled to a survivor annuity as provided in subsecticn (c)
22 of this section.
23 " (2)(~) ~ survivor annuity shall not be paid to a
24 surviving spouse of a former participant who, jointly with
25 the former participant, waived a survivor annuity under this
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1 section as provided in subparagraph (B) of this paragraph.
2 ` ` (B ) For the purposes of subparagraph ( ~) of this
3 paragraph, a waiver may be made only in Writing, on the date
4 payment of an annuity to the former participant commences
5 under subchapter II of this chapter, and in accordance with
6 such regulations as the Office may prescribe.
7 " (c) Except 3s provided in subsection (d) of this
8 section, the amount of the survivor annuity payable under
9 subsection (b) of this section to a deceased former
10 participant's surviving spouse--
11 " (1) for any month the surviving spouse is or
12 becomes eligible, by reason of the death of the former
13 participant and based on the service of the former
14 participant, to receive benefits pursuant to subsection
15 (e), (f), or (g) of section 202 of the Social Security
16 Act (or would be or would become eligible to receive such
17 benefits if the participant had been fully or currently
19 insured for the purposes of such subsection) shall be
19 equal to--
20 " (A) in the case of a surviving spouse whc has
21 not received a survivor annuity computed pursuant to
22 paragraph (2) of this subsection (based on the
23 service of the deceased former participant), 50
24 percent of the amount of the deceased former
25 participant's annuity computed pursuant to sections
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1 8413 and 8414 of this title without regard to section
2 8415 of this title and adjusted as provided in
3 section 8452 of this title; and
4 " (B) in the case of a surviving spouse whc has
5 sere?ved 3 survivor annuity computed pursuant tc
6 paragraph (2) of this subsection (based on the
7 service of the deceased former participant), Se
8 percent of the amount of such survivor annuity the
9 surviving spouse was entitled to receive for tre
10 latest month such paragraph applied to the survivor
11 annuity; and
12 ` ` (2 ) for any full month the surviving spouse is not
13 eligible to receive benefits pursuant to subsection (e),
14 (f ), or (4) cf section 2~'2 of the Social Security Ac*
15 (and would not be eligible to receive such benefits if
15 the participant had been fully or currently insures for
17 the purposes of such subsection) shall be equal to the
18 amount of the deceased former participant's annuity
19 computed pursuant to sections 8413, 8414, and 8415 of
20 this title.
21 " (d) The amount of the survivor annuity payable under
22 this section to the surviving spouse of a deceased forR.er
23 participant shall be equal to the excess, if any, of the
24 amount of the survivor annuity which would be payable to the
25 surviving spouse under this section without regard to this
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1 subsection over the total amount of any survivor annuity or
2 survivor annuities payable pursuant to section 8434 of this
3 title to an eligible former spouse or eligible former spouses
4 of the deceased farmer participant.
5 ??~ 8433. Survivor benefits under the thrift savings plan
6 " (a) Except 3s provided in section 8425(a) of this title
7 or subsection (c) of this section, the amount in the account
e established and m3lntained for a deceased participant cr
9 deceased former participant pursuant to section 8428(a) of
10 this title, determined on the date of distribution under this
11 section, shall, subject to the limits of the entitlement set
12 out in section 8422(a)(1) of this title (vithout regard to
13 section 8422(a)(2) of this title), be paid to--
14 ? ? (1) the surviving spouse of the deceased
15 participant pursuant to the method elected under
16 subsection (b) of this section; or
17 " (2) if these is no surviving spouse, to the es?ate
18 of the deceased participant.
19 ?`(b) a surviving spouse entitled to payment of benefits
20 under subsection (a) of this section may elect--
21 ??(1) to receive an annuity from the Fund payable
22 monthly for life;
23 ? ? (2) to transfer the amount referred to in such
24 subsection tc an individual retirement account (Within
25 the meaning of the Internal Revenue Code of 1954) cf the
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1 surviving spcuse; oc
2 " (3) to Withdraw such amount in one payment.
3 " (c) ( 1) Any amount required for the payment of a
4 survivor annuity With respect to a deceased participant or
5 deceased former participant out of the Thrift Savings Fund
6 pursuant to section 8434 of this title shall be deducted and
7 withheld from a distribution made With respect to the
8 deceased participant or deceased former participant pursuant
9 to subsection (a) of this section. The amount deducted and
10 withheld shall be maintained in the Thrift Savings Fund until
11 expended in payment of the survivor annuity oc until the
12 survivor annuity terminates. Any sums remaining from the
13 amount deducted and Withheld after the termination of the
14 survivor annuity, plus net earnings realized from investment
15 of such amount, shall be distributed as provided in
16 subsection (a) of~this section.
17 "S 8434. Survivor benefits for eligible former spouses:
18 entitlement; amount
19 " (a) Subject to subsections (b) through (f) of this
20 section, an eligible formes svouse of a deceased participant
21 or deceased former participant is entitled to a survivor
22 annuity under this section, if and to the extent that an
23 election under section 8435 of this title or the terms of any
24 court decree dissolving or annulling the marriage of the
25 participant or former participant and the eligible former
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1 spouse or any court order or court-approved property
2 settlement agreement incident to such decree expressly
3 provides for such survivor annuity.
4 ' ` (b) ( 1) The amount of the survivor annuity payable from
5 the Fund to an eligible former spouse of a deceased
6 participant or deceased former participant under this section
7 may not exceed the excess, if any, of--
e " (~) the amount applicable in the case of such
9 eligible former spouse, as determined under paragraph (2)
10 of this subsection, over
11 " (B) the amount of any survivor annuity payable from
12 the Fund under this section to any other eligible former
13 spouse of the participant or former participant based on
14 an election previously made under section 8435 cf this
15 title or a court decree or order previously issued.
16 ` ` (2) (7! ) For the purposes of paragraph (1) (~- ) of t his
17 subsection, the applicable amount in the case of an eligible
18 former spouse of 3 deceased participant or deceased former
19 participant is the amount Which Would De applicable--
20 ?` (i) under section 8432(c) of this title (eithout
21 regard to section 8432(d) of this title) in the case of a
22 surviving spouse of the deceased, if the deceased Baas a
23 former participant Who died after retirement; or
24 " (ii) under section 8431(b) (1) of this title
25 ( Without reg acd to section 8431(c) of this title ) in the
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1 case of a surviving spouse cf the deceased, if the
2 deceased was 3 participant dAscribed in section 8431!n election under this subparagraph shall be made in a signed
6 writing received by the office Within two years after the
7 date of the remarriage.
8 " (2) an election under paragraph (1) of this subsection
9 shall be effective the first day of the second month
10 beginning after the election is received by the office, but
11 not earlier than nine months after the date of the remarriage
12 referred to in such paragraph.
13 " (3) ~ former participant making an election under
14 paragraph (1) of this subsection shall, Within two years
15 after the date of the remarriage referred to in such
16 paragraph, deposit in the Fund an amount determined by the
17 Office, as nearly as may be administratively feasible, to
18 reflect the amount by which the annuity of such former
19 participant would have been reduced if the election had been
20 in effect since the date that payment of ar, annuity to the
21 former participant under subchapter II of this chapter
22 commenced or, if later, the date the previous reductior. in
23 such former participant's annuity was terminated under
24 section 8415(b) cr 8415(c) of this title, plus interest.
25 " (4) Notwithstanding any other provision of this
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1 paragraph, an election under this subsection may not be made
2 for the purpose cf providing a survivor annuity to a spouse
3 of a former participant by remarriage if--
4 " (a) such spouse was married to the former
5 participant on the date that payment of an annuity to the
6 former participant under subchapter II of this chapter
7 commenced; and
e " (E) all rights to survivor benefits for such spouse
9 under this subchapter based on marriage to such former
10 participant were then waived under section 8432(bi(2) of
11 this title.
12 ? " (e) For the purposes of subsection