OPM Retirement Cut Legislative Proposal Draws Bipartisan Opposition

Just a week after Office of Personnel Management Director Jeff Pon sent a letter to House Speaker Paul Ryan requesting legislation that would cut federal employee retirement benefits, there seems to be little momentum behind the initiative.

Late last week, Pon proposed legislation for a number of retirement cuts, all of which had previously been included in both of President Trump’s annual budget proposals. The suggested legislation would: eliminate Federal Employees Retirement System supplements for employees who retire before age 62; increase employee contributions to FERS by 1 percentage point per year until they reach an overall contribution level of 7.25 percent, matching the government’s share; change the basis of defined benefit annuity payments from an employee’s highest three years of salary to his or her highest five years; and eliminate cost-of-living adjustments for FERS retirees—both current and future—and reduce Civil Service Retirement System COLAs by 0.5 percent.

The White House reportedly pushed for lawmakers to include the cuts in the fiscal 2019 National Defense Authorization Act ahead of a committee mark-up on Wednesday, but lawmakers in both parties declined to consider it.

Others on Capitol Hill also seem reluctant to take up the administration’s cause. A spokesperson for House Oversight and Government Reform Committee Chairman Trey Gowdy, R-S.C., did not return requests for comment on the proposal. Meanwhile, Republicans and Democrats have come out in opposition to the plan.

Rep. Elijah Cummings, D-Md., ranking member of the oversight committee, said that if Congress enacts these changes, it would be breaking a promise to public servants.

“The Trump administration’s draconian proposal—to cut more than $143 billion over the next 10 years from the pay and benefits of current federal workers, retirees, future retirees, and even children who suffer the loss of a parent—comes after the president and Republicans in Congress just enacted $1.5 trillion in tax cuts for wealthy individuals and corporations,” Cummings said in a statement. “Enacting these changes would betray the promises the nation has made to middle class federal workers who dedicate their lives to public service—as well as their families—and it would severely degrade recruitment and retention.”

Rep. Mike Turner, R-Ohio, sent a letter to Pon Wednesday urging him to rescind his proposal, arguing the move would make it harder, not easier to recruit the next generation of federal employees.

“Despite their hard work and dedication, few groups have been asked to sacrifice more than federal employees,” Turner wrote. “Since the start of the Great Recession in 2008, federal workers have foregone $182 billion in the form of pay and benefit cuts . . . With the United States’ growing economy and a tightening labor market, we cannot afford to make the federal government a less attractive place to work by diminishing the very benefits that help the government keep pace with jobs in the (often higher-paying) private sector.”

Rep. Don Beyer, D-Va., also said he opposes the retirement cuts. He said an apparent lack of congressional willingness to enact the changes has not alleviated the fears of feds he has spoken with.

“In fact, I spoke today at a federal government luncheon, and a couple hands went up at the end for questions,” Beyer said in an interview Thursday. “The first question was, ‘Are you going to fight this new OPM suggestion?’ I went on for a minute about how I would, and then when I looked around, there were no more hands up. I asked, ‘What happened?’ And someone replied, ‘We all had the same question.’ ”

Beyer said he has trouble seeing any path forward for Pon’s proposals, even in the more solidly Republican-controlled House.

“I think it’s going to be tough slogging for them, because there are some prominent, powerful Republicans who are fairly fierce defenders of federal employees,” he said. “You’ve got Rob Bishop of Utah, Mike Simpson [of Idaho], and Tom Cole from Oklahoma . . . Virtually no Democrats will support this, and so you don’t need a whole lot of people upending it from the Republican side for this thing to be dead.”