IMPORTANT CHANGE TO RETIREMENT LAW INCLUDING PROVISION FOR FORMER SPOUSE ANNUITY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90B01370R000100110008-1
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 3
• Document Creation Date: December 21, 2016
• Document Release Date: December 30, 2008
• Sequence Number: 8
• Publication Date: October 1, 1982
• Content Type: REGULATION

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POST OFFICE BOX 1925 rorwaroeo to All CIARDS
WASHINGTON, D. C. 20013 tirees
T.kph October 1982
IMPORTANT CHANGE TO RETIREMENT' LAW
INCLUDING PROVISION FOR FORMER SPOUSE ANNUITY
This notice is to inform you of changes in the law concerning retirees.
The "omnibus Budget Reconciliation Act of 1982" is effective 1 October 1982
and applies to both the CIARDS and CSRS systems. The Act includes the follow-
ing changes that will effect annuitants:
Cost-of-Living Adjustments
During 1983, 1984 and 1985 the effective date of the cost-of-living adjustments
has been changed from the current March 1 of each year to April 1, 1983, May 1,
1984 and June 1, 1985. These increases will be reflected in the annuity checks
issued on 1 May 1983, 1 June 1984 and 1 July 1985. The COLA continues to be
based on the December to December increase in the consumer price index. In 1986
the current March 1 effective date will once again apply. In addition, certain
annuitants will receive less than the full cost-of-living adjustments in these
three fiscal years. Annuitants who are under age 62 as of March 1 in each year
and who are not disability annuitants or survivor annuitants will receive the
following cost-of-living adjustments in 1983, 1984, and 1985:
April 1983 - 3.3 percent, plus any amount by which the actual CPI
increase exceeds 6.6 percent
May 1984 - 3.6 percent, plus any amount by which the actual CPI
increase exceeds 7.2 percent
June 1985 - 3.3 percent, plus any amount by which the actual CPI
increase exceeds 6.6 percent.
If the actual cost-of-living increase granted is less than or equal to the pro-
jected adjustments for the next three years, under age 62 annuitants will receive
one-half of the projected adjustment.
Disability Retirement
The test period concerning "Restored to Earning Capacity" for disability retirees
has been reduced from two years to one year and the grace period to receive con-
tinued payments shortened to six months. These provisions apply to earnings
after 31 December 1982. In addition, the bill allows the Retirement Systems to
verify records of the Social Security Administration and the Department of Labor.
Rounding Down of Retirement Annuities
Retirement annuities will be rounded down to the next lowest dollar, both when
they are computed and when they are adjusted by the rise in the cost-of-living.
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Credit for Military Service
Under previous law, military service could be credited toward a civil service
annuity, but the annuity was recomputed at age 62 to exclude credit for any
post-1956 military service if the individual was eligible for Social Security
benefits.
The new law provides that annuities for these individuals would be reduced at
age 62 by an amount equal to a fraction of their Social Security benefit com-
puted by dividing their total military wages that were subject to Social Security
deductions by their total lifetime wages that were subject to Social Security
deductions. Thus, individuals having Social Security covered employment only
in the military would have their civil service annuity reduced at age 62 by the
full amount of the Social Security benefit they were eligible to begin receiving
at age 62. However, the reduction so computed will not be permitted to be
greater than the reduction required by previous law. This new formula applies
to all annuity payments after October 1, 1982, including annuity payments to
those who have previously reached age 62 and thus already had their annuities
recomputed.
All annuitants who are affected by this provision will receive a separate notice
concerning their status.
Limit on Annuities
Cost-of-living adjustments will not be made to annuities if such adjustments
cause the annuities to exceed the rate of pay for a GS-15, Step 10 (now $57,500)
unless the annuitants final pay (or average pay, if higher), when increased by
the cumulative average General Schedule pay increase since the annuitant's
retirement, is higher than that rate, in which case cost-of-living adjustments
could be given up to such higher amount. This provision applies to all cost-
of-living adjustments after 8 September 1982, but no annuity will be reduced.
New Legislation Effecting Former Spouses
Under Title VI, Retirement Benefits for Certain Former Spouses of Central
Intelligence Agency Employees, of Public Law 97-269 the former spouse annuity
provisions become effective on 15 November 1982. As defined by the Act, "former
spouse" means a former wife or husband of a participant or former participant
who was married to such participant for not less than 10 years during periods
of service by that participant which are creditable under the Act, at least
five years of which were spent outside the United States by both the participant
and the former spouse.
The Act allows qualified spouses of employees who are separated from service
with the Agency after 15 November 1982 and who were divorced from the participant
on or after 15 November 1982 to share in the retirement annuity, survivor bene-
fits and lump sum disbursements paid from retirement funds. The legislation does
not affect those individuals who were divorced prior to the effective date of the
Act. Retirees who are divorced on or after 15 November 1982 will be affected
insofar as the provision of a survivor annuity for a former spouse is concerned.
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The maximum survivor annuity that may be provided for that former spouse is limited
to the amount provided for that person at the time of retirement. This limited
application means that unless otherwise expressly provided by any spousal agreement
or court order, the former spouse shall be entitled to a survivor annuity...
A. if married to the participant (retiree) throughout the creditable
service of the participant, equal to 55 percent of the elected
amount of the participant's annuity, or
B. if not married to the participant (retiree) throughout such
creditable service, equal to a proportion of 55 percent of the
elected amount of such annuity which is the proportion that the
number of days of the marriage bears to the total number of days
of such creditable service.
The former spouse shall not be qualified for any annuity if the former spouse
remarries before becoming 60 years of age.
It should be noted that the new provisions of law summarized above are
stated in general terms and in a simplified manner. This notice is not a com-
prehensive statement. Any questions concerning this notice should be directed
to the address on this letterhead.
CHIEF, RETIREMENT AFFAIRS DIVISION
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