Senate Panel Advances Budget Resolution Over Democratic Objections

A Senate panel voted by party lines Thursday to advance a budget proposal that would slash discretionary spending at non-defense agencies by 9 percent in fiscal 2020, including an instruction for the committee that governs federal employee benefits to cut $15 billion over the next five years.

The Senate Budget Committee proposal, released last week, would instruct the Senate Homeland Security and Governmental Affairs Committee to cut $15 billion from programs within its jurisdiction. Although the committee is not required to tap federal benefits, such proposals typically result in changes to the Federal Employees Retirement System.

In President Trump’s fiscal 2020 budget request, the White House outlined a number of proposed changes to federal employees’ retirement benefits. Those plans included:

• Require federal workers to contribute about 6 percent more to FERS, phased in over the next six years.
• Eliminate cost of living adjustments for current and future FERS retirees, and reduce COLAs for Civil Service Retirement System participants by 0.5 percent.
• Eliminate the early retirement supplement for FERS annuitants under the age of 62.
• Base annuity calculations on a FERS participant’s highest five years of salary, rather than the current highest three years.
• Cut the interest rate of the Thrift Savings Plan’s government securities (G) fund, likely by basing it on the four-week U.S. Treasury bill.

Committee Democrats attempted in vain to roll back the proposals in the resolution that could impact federal employee benefits. Sen. Tim Kaine, D-Va., introduced an amendment that would have gotten rid of the language concerning the Homeland Security and Governmental Affairs Committee altogether.

“What my amendment would do is simply strike the reconciliation instruction, because of the effect we’ve already visited on employees with the [partial government] shutdown,” Kaine said. “It really affected federal employees in a very significant way. They’ve already been blasted with the 35-day shutdown, and we all interacted with them enough to know that the morale and retention effect on these employees has been significant.”

And Sen. Mark Warner, D-Va., introduced an amendment with Kaine and Sen. Chris Van Hollen, D-Md., which would block Congress from using federal employee retirement programs to offset spending increases elsewhere in the appropriations process.

“Under the budget put forward by the White House, the administration has used these federal employees’ retirement accounts to offset spending elsewhere,” Warner said. “That’s a slap in the face of federal employees all over the country, not just in the Washington, D.C., area. It’s further insult to injury.”

Republicans on the committee blocked both amendments from being adopted, and the resolution advanced to the Senate floor by a party-line vote. Although Committee Chairman Mike Enzi, R-Wyo., opposed both amendments, he suggested it was merely a first offer in the negotiation process.

“Right now, this is simply a target for committees, and it is not prescriptive,” Enzi said. “It’s up to each committee how they want to do it. It could be cuts or it could be revenue . . . [We want to] move it one step closer to a possible floor debate, and then a possible conference [committee negotiation] with the House.”