Congress makes early out authority permanent

Permanent early retirement authority and a 4.8 percent federal pay raise are just two of the goodies Congress packed into the fiscal 2000 Treasury-Postal appropriations bill.

Before Congress' passage of the bill this week, the government's early out authority was set to expire on Sept. 30, 1999. The Treasury-Postal bill will allow agencies to offer early outs after that date.

To qualify for early retirement, an employee must have 25 years of service regardless of age or 20 years of service and be at least 50 years old. Employees under the Civil Service Retirement System who take early outs have their pensions reduced by 2 percent for each year they are under age 55. There is no reduction for Federal Employees Retirement System enrollees. Under early out authority, the employees begin receiving their annuities right after they leave government. Without such authority, they would either have to take a lump-sum payment of their retirement contributions or wait to receive their pensions until they are older.

"We have extended the authority for voluntary early retirement for federal employees in this bill, critical as we downsize in a smart way," Rep. Steny Hoyer, D-Md., said on the House floor this week. Hoyer argued that early outs will help agencies avoid layoffs. "Clearly an across-the-board [reduction-in-force] is very inefficient. It does not necessarily remove those employees who are no longer needed, and is, both from an efficiency standpoint and from an economic standpoint, a very poor way to manage our service."

Agencies must request early out authority from the Office of Personnel Management.

Hoyer also championed a 4.8 percent pay raise next year for federal employees, the same raise military personnel will get in January. Hoyer inserted the 4.8 percent increase, the biggest civilian increase since 1982, to force President Clinton to give employees more than the 4.4 percent increase proposed in the President's fiscal 2000 budget proposal.

National Treasury Employees Union President Colleen Kelley issued a statement applauding Congress for passing the 4.8 percent raise, but she called for Congress and the Clinton administration to commit to high raises in the future as well.

"We don't think it is unrealistic for Congress and the administration to start taking action now, now that the budget deficit has been eliminated, to ... create a competitive environment in which the nation's best and brightest will be drawn to the public service," Kelley said.

Other federal pay, benefits and management provisions in the Treasury-Postal bill include:

• Requiring agencies to reimburse federal managers and other professionals for half the cost of professional liability insurance. Previously, agencies could offer the reimbursements but were not required to.
• Boosting the President's pay from $200,000 a year to $400,000 a year when the next President takes office.
• Allowing agencies to subsidize the cost of child care in federal facilities for low-income workers.
• Prohibiting abortion coverage under the Federal Employees Health Benefits Program, but requiring coverage of contraceptives.
• Establishing a chief financial officer in the Executive Office of the President when the next administration takes office.
• Requiring the Treasury Department to create a Web site allowing taxpayers to generate an itemized receipt showing the allocation of their taxes among major federal spending categories.
• Requiring the General Services Administration to modify its procedures for determining per diem rates to assure that next year's per diems determination "accurately reflects the cost of federal travel."
• Offering buyouts of up to $25,000 for employees of the Office of the Treasury Inspector General for Tax Administration through Jan. 1, 2003.
• Offering buyouts of up to $25,000 for employees of the Chicago Financial Center of Treasury's Financial Management Service until Jan. 31, 2000.

One person who lost out in the Treasury-Postal bill was the U.S. Customs Service Commissioner. The Senate and House rejected a provision that would have boosted the Customs chief's salary.