FEDERAL EMPLOYEES' RETIREMENT SYSTEM ACT OF 1986

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90-00530R000701790008-5
• Release Decision: RIPPUB
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• Document Page Count: 120
• Document Creation Date: December 23, 2016
• Document Release Date: March 7, 2013
• Sequence Number: 8
• Publication Date: June 6, 1986
• Content Type: OPEN SOURCE

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1.41-1 u9-335?JUNE 6, 1986
0 LI
3-351z
FEDERAL EMPLOYEES' RETIREMENT
SYSTEM ACT OF 1986
71-139 0 - 86 (337)
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LAW 99-335?JUNE 6, 1986
June 6, 1986
[H.R. 2672]
Federal
Employees'
Retirement
System Act
of 1986.
New Jersey
International
and
Bulk Mail
Center.
Public Law 99-335
99th Congress
An Act
To amend title 5, United States Code, to establish a new retirement and disability
plan for Federal employees, postal employees, and Members of Congress, and for
other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. REDESIGNATION OF BUILDING.
(a) REDESIGNATION.?The New York Bulk and Foreign Mail
Center in Jersey City, New Jersey, shall hereafter be known and
designated as the "New Jersey International and Bulk Mail
Center". Any reference to such building in any law, map, regulation,
document, record, or other paper of the United States shall be
considered to be a reference to the New Jersey International and
Bulk Mail Center.
(b) EFFECTIVE DATE.?This section shall take effect 6 months after
the date of the enactment of this Act.
SEC. 2. DEDICATION OF MICHAEL McDERMOTT PLACE.
(a) ERECTION OF SIGN.?The United States Postal Service shall
erect a suitable sign bearing the inscription "Michael McDermott
Place", anywhere on its property adjacent to the street and parking
area located immediately to the east of the New York Bulk and
Foreign Mail Center building in Jersey City, New Jersey, so as to
dedicate such portion of such street in memory of former postal
employee Michael McDermott.
(b) EFFECTIVE DATE.?This section shall take effect on the date of
the enactment of this Act.
TITLE I?FEDERAL EMPLOYEES'
RETIREMENT SYSTEM
SEC. 100. SHORT TITLE; TABLE OF CONTENTS.
5 USC 8401 note. (a) SHORT TITLE.?This Act may be cited as the "Federal
Employees' Retirement System Act of 1986".
(b) TABLE OF CONTENTS.?The table of contents is as follows:
TABLE OF CONTENTS
TITLE I?FEDERAL EMPLOYEES' RETIREMENT SYSTEM
Sec. 100. Short title; table of contents.
Sec. 100A. Purposes.
Sec. 101. Establishment.
TITLE II?OTHER AMENDMENTS TO TITLE 5 OF THE UNITED STATES CODE
Sec. 201. Treatment under Civil Service Retirement System of certain individuals
excluded from Federal Employees' Retirement System.
Sec. 202. Non-applicability of Civil Service Retirement System to individuals under
Federal Employees' Retirement System.
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Sec. 203. Pay for the Executive Director of the Federal Retirement Thrift Invest-
ment Board.
Sec. 204. Alternative forms of annuities.
Sec. 205. Retirement counseling.
Sec. 206. Participation by certain employees and Members only in the Thrift
Savings Plan.
Sec. 207. Miscellaneous amendments.
TITLE III-OTHER PROVISIONS RELATING TO THE FEDERAL EMPLOYEES'
RETIREMENT SYSTEM AND THE CIVIL SERVICE RETIREMENT SYSTEM
Sec. 301. Elections.
Sec. 302. Effect of an election under section 301 to become subject to the Federal
Employees' Retirement System.
Sec. 303. Provisions relating to an election to become subject to chapter 83 subject
to certain offsets relating to Social Security.
Sec. 304. Amendments relating to Social Security.
Sec. 305. Extension of Federal Employees' Retirement Contribution Temporary Ad-
justment Act of 1983; refund of excess contributions.
Sec. 306. Applicability to the United States Postal Service.
Sec. 307. Use of "normal-cost percentage".
Sec. 308. Retirement study.
Sec. 309. Repeal of automatic transfer provision.
Sec. 310. Disclosure of return information.
Sec. 311. Initial appointments to the Federal Retirement Thrift Investment Board.
Sec. 312. Plan for delayed contributions to the Thrift Savings Fund.
TITLE P1-FOREIGN SERVICE RETIREMENT
Sec. 401. Short title; references to Foreign Service Act of 1980.
Sec. 402. Redesignation of certain provisions of the Foreign Service Act of 1980.
Sec. 403. Definition of court.
Sec. 404. Creditable service for purposes of subchapters I and II.
Sec. 405. Contributions to the Foreign Service Retirement and Disability System.
Sec. 406. Offset of annuity by the amount of Social Security benefits.
Sec. 407. 18-month period to elect survivor annuity.
Sec. 408. Alternate forms of annuities.
Sec. 409. Treatment of certain recall service.
Sec. 410. Reemployment.
Sec. 411. Comparability between the Federal Employees' Retirement System and
the Foreign Service Pension System.
Sec. 412. Moderation of remarriage penalty.
Sec. 413. Lump-sum payments.
Sec. 414. Exclusion of participants in Foreign Service Pension System from Foreign
Service Retirement and Disability System.
Sec. 415. Foreign Service Pension System.
Sec. 416. Table of contents.
Sec. 417. Effective date.
TITLE V-CENTRAL INTELLIGENCE AGENCY RETIREMENT AND RELATED
MATTERS
Sec. 501. References.
Sec. 502. Contributions to the Central Intelligence Agency Retirement and Disabil-
ity System.
Sec. 503. Offset of annuity by the amount of Social Security benefits.
Sec. 504. Thrift savings fund participation by participants in the Central Intelli-
gence Agency Retirement and Disability System.
Sec. 505. Alternative forms of annuities.
Sec. 506. Participation in the Federal Employees' Retirement System.
Sec. 507. Special retirement accrual for other intelligence personnel.
TITLE VI-MISCELLANEOUS PROVISIONS
Sec. 601. Annuities for survivors of District of Columbia judges.
TITLE VII-AUTHORIZATION OF APPROPRIATIONS; EFFECTIVE DATES
Sec. 701. Authorization of appropriations for certain expenses of the Federal Retire-
ment Thrift Investment Management System.
Sec. 702. Effective dates.
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nyv 011-1.1. e/.1.0 a.)a,?JiC LAW 99-335-JUNE 6, 1986
42 USC 401.
SEC. 100A. PURPOSES.
The purposes of this Act are-
(1) to establish a Federal employees' retirement plan which is
coordinated with title II of the Social Security Act;
(2) to ensure a fully funded and financially sound retirement
benefits plan for Federal employees;
(3) to enhance portability of retirement assets earned as an
employee of the Federal Government;
(4) to provide options for Federal employees with respect to
retirement planning;
(5) to assist in building a quality career work force in the
Federal Government;
(6) to encourage Federal employees to increase personal sav-
ings for retirement; and
(7) to extend financial protection from disability to additional
Federal employees and to increase such protection for eligible
Federal employees.
SEC. 101. ESTABLISHMENT.
(a) IN GENERAL.-Title 5, United States Code, is amended by
inserting after chapter 83 the following new chapter:
"CHAPTER 84-FEDERAL EMPLOYEES' RETIREMENT SYSTEM
"SUBCHAPTER I-GENERAL PROVISIONS
"8401. Definitions.
"8402. Federal Employees' Retirement System; exclusions.
"8403. Relationship to the Social Security Act.
"SUBCHAPTER II-BASIC ANNUITY
"8410. Eligibility for annuity.
"8411. Creditable service.
"8412. Immediate retirement.
"8413. Deferred retirement.
"8414. Early retirement.
"8415. Computation of basic annuity.
"8416. Survivor reduction for a current spouse.
"8417. Survivor reduction for a former spouse.
"8418. Survivor elections; deposit; offsets.
"8419. Survivor reductions; computation.
"8420. Insurable interest reductions.
"8420a. Alternative forms of annuities.
"8421. Annuity supplement.
"8421a. Reductions on account of earnings from work performed while entitled to an
annuity supplement.
"8422. Deductions from pay; contributions for military service.
"8423. Government contributions.
"8424. Lump-sum benefits; designation of beneficiary; order of precedence.
"8425. Mandatory separation.
"SUBCHAPTER III-THRIFT SAVINGS PLAN
"8431. Definition.
"8432. Contributions.
"8433. Benefits and election of benefits.
"8434. Annuities: methods of payment; election; purchase.
"8435. Protections for spouses and former spouses.
"8436. Administrative provisions.
"8437. Thrift Savings Fund.
"8438. Investment of Thrift Savings Fund.
"8439. Accounting and information.
"8440. Tax treatment of the Thrift Savings Fund.
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"SUBCHAPTER IV-SURVIVOR ANNUITIES
"8441. Definitions.
"8442. Rights of a widow or widower.
"8443. Rights of a child.
"8444. Rights of a named individual with an insurable interest.
"8445. Rights of a former spouse.
"SUBCHAPTER V-DISABILITY BENEFITS
"8451. Disability retirement.
"8452. Computation of disability annuity.
"8453. Application.
"8454. Medical examination.
"8455. Recovery; restoration of earning capacity.
"8456. Relationship to workers' compensation.
"8457. Military reserve technicians.
"SUBCHAPTER VI-GENERAL AND ADMINISTRATIVE PROVISIONS
"8461. Authority of the Office of Personnel Management.
"8462. Cost-of-living adjustments.
"8463. Rate of benefits.
"8464. Commencement and termination of annuities of employees and Members.
"8465. Waiver, allotment, and assignment of benefits.
"8466. Application for benefits.
"8467. Court orders.
"8468. Annuities and pay on reemployment.
"8469. Withholding of State income taxes.
"8470. Exemption from legal process; recovery of payments.
"SUBCHAPTER VII-FEDERAL RETIREMENT THRIFT INVESTMENT
MANAGEMENT SYSTEM
"8471. Definitions.
"8472. Federal Retirement Thrift Investment Board.
"8473. Employee Thrift Advisory Council.
"8474. Executive Director.
"8475. Investment policies.
"8476. Administrative provisions.
"8477. Fiduciary responsibilities; liability and penalties.
"8478. Bonding.
"8479. Exculpatory provisions; insurance.
"SUBCHAPTER I-GENERAL PROVISIONS
"? 8401. Definitions
"For the purpose of this chapter-
"(1) the term 'account means an account established and
maintained under section 8439(a) of this title;
"(2) the term 'annuitant' means a former employee or
Member who, on the basis of that individual's service, meets all
requirements for title to an annuity under subchapter II or V of
this chapter and files claim therefor;
"(3) the term 'average pay' means the largest annual rate
resulting from averaging an employee's or Member's rates of
basic pay in effect over any 3 consecutive years of service or, in
the case of an annuity under this chapter based on service of
less than 3 years, over the total service, with each rate weighted
by the period it was in effect;
"(4) except as provided in subchapter III of this chapter, the
term 'basic pay' has the meaning given such term by section
8331(3);
"(5) the term 'Board' means the Federal Retirement Thrift
Investment Board established by section 8472(a) of this title;
5 USC 8401.
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-1 LAW 99-335?JUNE 6, 1986
"(6) the term 'Civil Service Retirement and Disability Fund'
or 'Fund' means the Civil Service Retirement and Disability
Fund under section 8348;
"(7) the term 'court' means any court of any State, the
District of Columbia, the Commonwealth of Puerto Rico, Guam,
the Northern Mariana Islands, or the Virgin Islands, and any
Indian court;
"(8) the term 'Director' means the Director of the Office of
Personnel Management;
"(9) the term 'dynamic assumptions' means economic assump-
tions that are used in determining actuarial costs and liabilities
of a retirement system and in anticipating the effects of long-
term future?
"(A) investment yields;
"(B) increases in rates of basic pay; and
"(C) rates of price inflation;
"(10) the term 'earnings', when used with respect to the Thrift
Savings Fund, means the amount of the gain realized or yield
received from the investment of sums in such Fund;
"(11) the term 'employee' means?
"(A) an individual referred to in subparagraph (A), (E),
(F), (H), (I), or (J) of section 8331(1) of this title; and
"(B) a Congressional employee as defined in section 2107
of this title, including a temporary Congressional employee
and an employee of the Congressional Budget Office;
any of whose civilian service after December 31, 1983, is employ-
42 USC 401. ment for the purposes of title II of the Social Security Act and
26 USC 3101 et chapter 21 of the Internal Revenue Code of 1954, except that
seq. such term does not include?
"(i) any individual referred to in?
"(I) clause (i), (v), (vi), or (ix) of paragraph (1) of
section 8331;
"(II) clause (ii) of such paragraph (other than an
employee of the United States Park Police, or the
United States Secret Service, any of whose civilian
service after December 31, 1983, is such employment);
or
"(III) the undesignated material after the last clause
of such paragraph; or
"(ii) any individual excluded under section 8402(c) of this
title;
"(12) the term 'former spouse' means a former spouse of an
individual?
"(A) if such individual performed at least 18 months of
civilian service creditable under section 8411 as an
employee or Member; and
"(B) if the former spouse was married to such individual
for at least 9 months;
"(13) the term 'Executive Director' means the Executive
Director appointed under section 8474(a);
"(14) the term 'firefighter' means?
"(A) an employee, the duties of whose position?
"(i) are primarily to perform work directly connected
with the control and extinguishment of fires; and
"(ii) are sufficiently rigorous that employment
opportunities are required to be limited to young and
physically vigorous individuals, as determined by the
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Director considering the recommendations of the
employing agency; and
"(B) an employee who is transferred directly to a super-
visory or admini3trative position after performing duties
described in subparagraph (A) for at least 10 years;
"(15) the term 'Government' means the Federal Government
and Gallaudet College;
"(16) the term 'Indian court' has the meaning given such term
by section 8331(24
'(17) t e rm 'law enforcement officer' means?
"(A) an employee, the duties of whose position?
"(i) are primarily?
"(I) the investigation, apprehension, or detention
of individuals suspected or convicted of offenses
against the criminal laws of the United States, or
(II) the protection of officials of the United
States against threats to personal safety; and
"(ii) are sufficiently rigorous that employment
opportunities are required to be limited to young and
physically vigorous individuals, as determined by the
Director considering the recommendations of the
employin
"MT an employee who is transferred directly to a super-
visory or administrative position after performing duties
described in sub ? ar ra h A) for at least 10 ears; and
an emp oyee?
"(i) of the Bureau of Prisons or Federal Prison Indus-
tries, Incorporated;
"(ii) of the Public Health Service assigned to the fiel
service of the Bureau of Prisons or of the Federa
Prison Industries, Incorporated; or
"(iii) in the field service at Army or Navy discipli
nary barracks or at any other confinement and r
habilitation facility operated by any of the arm
forces;
whose duties in connection with individuals in detentio
suspected or convicted of offenses against the criminal law
of the United States or of the District of Columbia o
offenses against the punitive articles of the Uniform Cod
of Military Justice (chapter 47 of title 10) require frequent
direct contact with these individuals in their detention and
are sufficiently rigorous that employment opportunities are
required to be limited to young and physically vigorous
individuals, as determined by the head of the employing
agency;
"(18) the term 'loss', when used with respect to the Thrift
Savings Fund, means the amount of the loss resulting from the
investment of sums in such Fund;
"(19) the term `lump-sum credit' means the unrefunded
amount consisting of?
"(A) retirement deductions made from the basic pay of an
employee or Member under section 8422(a) of this title (or
under section 204 of the Federal Employees' Retirement
Contribution Temporary Adjustment Act of 1983);
"(B) amounts deposited by an employee or Member under
section 8422(e); and
STAT STAT
5 USC 8331 note.
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5 USC 8331 note.
"(C) interest on the deductions and deposits which, for
any cplendar year, shall be equal to the overall average
yield to the Fund during the preceding fiscal year from all
obligations purchased by the Secretary of the Treasury
during such fiscal year under section 8348 (c), (d), and (e), as
determined by the Secretary (compounded annually);
but does not include interest?
"(i) if the service covered thereby aggregates 1 year or
less; or
"(ii) for a fractional part of a month in the total service;
"(20) the term 'Member' has the same meaning as pros ided in
section 2106, except that such term does not include an individ-
ual who irrevocably elects, by written notice to the official by
whom such individual is paid, not to participate in the Federal
Employees' Retirement System;
"(21) the term 'net earnings' means the excess of earnings
over losses;
"(22) the term 'net losses' means the excess of losses over
earnings;
"(23) the term 'normal-cost percentage' means the entry-age
normal cost of the provisions of the System which relate to the
Fund, computed by the Office in accordance with generally
accepted actuarial practice and standards (using dynamic
assumptions) and expressed as a level percentage of aggregate
basic pay;
"(24) the term 'Office' means the Office of Personnel
Management;
"(25) the term 'price index' has the same meaning as provided
in section 8331(15);
"(26) the term 'service' means service which is creditable
under section 8411;
"(27) the term 'supplemental liability' means the estimated
excess of?
"(A) the actuarial present value of all future benefits
payable from the Fund under this chapter based on the
service of current or former employees or Members, over
"(B) the sum of?
"(0 the actuarial present value of deductions to be
withheld from the future basic pay of employees and
Members currently subject to this chapter pursuant to
section 8422;
"(ii) the actuarial present value of the future con-
tributions to be made pursuant to section 8423(a) with
respect to employees and Members currently subject to
this chapter;
"(iii) the Fund balance as of the date the supple-
mental liability is determined, to the extent that such
balance is attributable?
"(I) to the System, or
"(II) to contributions made under the Federal
Employees' Retirement Contribution Temporary
Adjustment Act of 1983 by or on behalf of an
individual who became subject to the System; and
"(iv) any other appropriate amount, as determined by
the Office in accordance with generally accepted
actuarial practices and principles;
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U Mill; LAW UU?;J60?JUNE 6, 1986 100 STAT. 521
"(28) the term 'survivor' means an individual entitled to an
annuity under subchapter IV of this chapter;
"(29) the term 'System' means the Federal Employees' Retire-
ment System described in section 8402(a);
"(30) the term 'military reserve technician' means a member
of one of the reserve components of the armed forces specified in
section 261(a) of title 10 who?
"(A) is assigned to a civilian position as a technician in
the administration and training of such reserve components
or in the maintenance and repair of supplies issued to such
reserve components; and
"(B) as a condition of employment in such position, is
required to be a member of one of such reserve components
serving in a specified military grade; and
"(31) the term 'military service' means honorable active
service?
"(A) in the armed forces;
"(B) in the commissioned corps of the Public Health
Service after June 30, 1960; or
"(C) in the commissioned corps of the National Oceanic
and Atmospheric Administration, or a predecessor entity in
function, after June 30, 1961;
but does not include service in the National Guard except when
ordered to active duty in the service of the United States.
"? 8402. Federal Employees' Retirement System; exclusions 5 USC 8402.
"(a) The provisions of this chapter comprise the Federal Em-
ployees' Retirement System.
"(b) The provisions of this chapter shall not apply with respect
to?
"(1) any individual who has performed service of a type
described in subparagraph (C), (D), (E), or (F) of section 210(aX5)
of the Social Security Act continuously since December 31, 1983 42 USC 410.
(determined in accordance with the provisions of section
210(a)(5)(B) of the Social Security Act, relating to continuity of
employment); or
"(2)(A) any employee or Member who has separated from the
service after?
"(i) having been subject to subchapter III of chapter 83 of
this title, or subchapter I of chapter 8 of the Foreign Service Post, pp. 589,
Act of 1980; and 591-593.
"(ii) having completed at least 5 years of civilian service 22 USC 4041.
creditable under subchapter III of chapter 83 of this title, or
at least 5 years of civilian service creditable under sub-
chapter I of the Foreign Service Act of 1980 (determined
without regard to any deposit or redeposit requirement
under either such subchapter, or any requirement that the
individual become subject to either such subchapter after
performing the service involved); or
"(B) any employee having at least 5 years of civilian service
performed before January 1, 1987, creditable under subchapter
III of chapter 83 of this title (determined without regard to any
deposit or redeposit requirement under such subchapter, any
requirement that the individual become subject to such sub-
chapter after performing the service involved, or any require-
ment that the individual give notice in writing to the official by
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Ivy 1.7 LIGGI L....EC LAW 99-335?JUNE 6, 1986
whom such individual is paid of such individual's desire to
become subject to such subchapter);
except to the extent provided for under title III of the Federal
Employees' Retirement System Act of 1986 pursuant to an election
under such title to become subject to this chapter.
"(cX1) The Office may exclude from the operation of this chapter
an employee or group of employees in or under an Executive agency,
the United States Postal Service, or the Postal Rate Commission,
whose employment is temporary or intermittent, except an em-
ployee whose employment is part-time career employment (as
defined in section 3401(2)).
"(2) The Architect of the Capitol may exclude from the operation
of this chapter an employee under the Office of the Architect of the
Capitol whose employment is temporary or of uncertain duration.
"(3) The Librarian of Congress may exclude from the operation of
this chapter an employee under the Library of Congress whose
employment is temporary or of uncertain duration.
"(4) The Director or Acting Director of the Botanic Garden may
exclude from the operation of this chapter an employee under the
Botanic Garden whose employment is temporary or of uncertain
duration.
5 USC 8403. "? 8403. Relationship to the Social Security Act
"Except as otherwise provided in this chapter, the benefits pay-
able under the System are in addition to the benefits payable under
42 USC 1305. the Social Security Act.
"SUBCHAPTER II?BASIC ANNUITY
5 USC 8410. "? 8410. Eligibility for annuity
"Notwithstanding any other provision of this chapter, an
employee or Member must complete at least 5 years of civilian
service creditable under section 8411 in order to be eligible for an
annuity under this subchapter.
5 USC 8411. "? 8411. Creditable service
"(aX1) The total service of an employee or Member is the full
years and twelfth parts thereof, excluding from the aggregate the
fractional part of a month, if any.
"(2) Credit may not be allowed for a period of separation from the
service in excess of 3 calendar days.
"(b) For the purpose of this chapter, creditable service of an
employee or Member includes?
"(1) employment as an employee, and any service as a
Member (including the period from the date of the beginning of
the term for which elected or appointed to the date of taking
office as a Member), after December 31, 1986;
"(2) service with respect to which deductions and
withholdings under section 204(aX1) of the Federal Employees'
5 USC 8331 note. Retirement Contribution Temporary Adjustment Act of 1983
have been made;
"(3) except as provided in subsection (0, any civilian service
(performed before January 1, 1989, other than any service under
paragraph (1) or (2)) which, but for the amendments made by
subsections (aX4) and (b) of section 202 of the Federal Em-
ployees' Retirement System Act of 1986, would be creditable
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under subchapter III of chapter 83 of this title (determined Post, pp. 589,
without regard to any deposit or redeposit requirement under 591-593.
such subchapter, any requirement that the individual become
subject to such subchapter after performing the service involved,
or any requirement that the individual give notice in writing to
the official by whom such individual is paid of such individual's
desire to become subject to such subchapter); and
"(4) a period of service (other than any service under any of
the preceding provisions of this subsection and other than any
military service) that was creditable under the Foreign Service
Pension System described in subchapter II of chapter 8 of the
Foreign Service Act of 1980, if the employee or Member waives 22 USC 3901.
credit for such service under the Foreign Service Pension
System and makes a payment to the Fund equal to the amount
that would have been deducted from pay under section 8422(a)
had the employee been subject to this chapter during such
period of service (together with interest on such amount com-
puted under paragraphs (2) and (3) of section 8334(e)).
"(cX1) Except as provided in paragraph (2) or (3), an employee or
Member shall be allowed credit for?
"(A) each period of military service performed before Janu-
ary 1, 195'7; and
"(B) each period of military service performed after Decem-
ber 31, 1956, and before the separation on which title to annuity
is based, if a deposit (including interest, if any) is made with
respect to such period in accordance with section 8422(e).
"(2) If an employee or Member is awarded retired pay based on
any period of military service, the service of the employee or
Member may not include credit for such period of military service
unless the retired pay is awarded?
"(A) based on a service-connected disability?
"(i) incurred in combat with an enemy of the United
States; or
"(ii) caused by an instrumentality of war and incurred in
line of duty during a period of war as defmed by section 301
of title 38; or
"(B) under chapter 67 of title 10. 10 USC 1331
"(3) An employee or Member who has made a deposit under et seq.
section 8334(j) (or a similar prior provision of law) with respect to a
period of military service, and who has not taken a refund of such
deposit?
"(A) shall be allowed credit for such service without regard to
the deposit requirement under paragraph (1XB); and
"(B) shall be entitled, upon filing appropriate application
therefor with the Office, to a refund equal to the difference
between?
"(i) the amount deposited with respect to such period
under such section 8334(j) (or prior provision), excluding
interest; and
"(ii) the amount which would otherwise have been
required with respect to such period under paragraph (1XB).
"(d) Credit under this chapter shall be allowed for leaves of
absence without pay granted an employee while performing mili-
tary service, or while receiving benefits under subchapter I of
chapter 81. An employee or former employee who returns to duty 5 USC 8101.
after a period of separation is deemed, for the purpose of this
subsection, to have been on leave of absence without pay for that
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5 USC 8101.
Post, pp. 589,
591-593.
5 USC 8412.
part of the period in which that individual was receiving benefits
under subchapter I of chapter 81. Credit may not be allowed for so
much of other leaves of absence without pay as exceeds 6 months in
the aggregate in a calendar year.
"(e) Credit shall be allowed for periods of approved leave without
pay granted an employee to serve as a full-time officer or employee
of an organization composed primarily of employees (as defined by
section 8331(1) or 8401(11)), subject to the employee arranging to
pay, through the employee's employing agency, within 60 days after
commencement of such leave without pay, amounts equal to the
retirement deductions and agency contributions which would be
applicable under sections 8422(a) and 8423(a), respectively, if the
employee were in pay status. If the election and all payments
provided by this subsection are not made, the employee may not
receive credit for the periods of leave without pay, notwithstanding
the third sentence of subsection (d).
"(OW An employee or Member who has received a refund of
retirement deductions under subchapter III of chapter 83 with
respect to any service described in subsection (bX3) may not be
allowed credit for such service under this chapter unless such
employee or Member deposits an amount equal to 1.3 percent of
basic pay for such service, with interest.
"(2) An employee or Member may not be allowed credit under this
chapter for any service described in subsection (bX3) for which
retirement deductions under subchapter III of chapter 83 have not
been made, unless such employee or Member deposits an amount
equal to 1.3 percent of basic pay for such service, with interest.
"(3) Interest under paragraph (1) or (2) shall be computed in
accordance with paragraphs (2) and (3) of section 8334(e) and regula-
tions prescribed by the Office.
"(4) For the purpose of survivor annuities, deposits authorized by
the preceding provisions of this subsection may also be made by a
survivor of an employee or Member.
"? 8412. Immediate retirement
"(a) An employee or Member who is separated from the service
after attaining the applicable minimum retirement age under
subsection (h) and completing 30 years of service is entitled to an
annuity.
"(b) An employee or Member who is separated from the service
after becoming 60 years of age and completing 20 years of service is
entitled to an annuity.
"(c) An employee or Member who is separated from the service
after becoming 62 years of age and completing 5 years of service is
entitled to an annuity.
"(d) An employee who is separated from the service, except by
removal for cause on charges of misconduct or delinquency?
"(1) after completing 25 years of service as a law enforcement
officer or firefighter, or any combination of such service totaling
at least 25 years, or
"(2) after becoming 50 years of age and completing 20 years of
service as a law enforcement officer or firefighter, or any
combination of such service totaling at least 20 years,
is entitled to an annuity.
"(e) An employee who is separated from the service, except by
removal for cause on charges of misconduct or delinquency?
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"(1) after completing 25 years of service as an air traffic
controller, or
"(2) after becoming 50 years of age and completing 20 years of
service as an air traffic controller,
is entitled to an annuity.
"(f) A Member who is separated from the service, except by
resignation or expulsion?
"(1) after completing 25 years of service, or
"(2) after becoming 50 years of age and completing 20 years of
service,
is entitled to an annuity.
"(g) An employee or Member who is separated from the service
after attaining the applicable minimum retirement age under
subsection (h) and completing 10 years of service is entitled to an
annuity. This subsection shall not apply to an employee or Member
who is entitled to an annuity under any other provision of this
section.
"(hX1) The applicable minimum retirement age under this subsec-
tion is?
"(A) for an individual whose date of birth is before January 1,
1948, 55 years of age;
"(B) for an individual whose date of birth is after Decem-
ber 31, 1947, and before January 1, 1953, 55 years of age plus the
number of months in the age increase factor determined under
paragraph (2)(A);
"(C) for an individual whose date of birth is after Decem-
ber 31, 1952, and before January 1, 1965, 56 years of age;
"(D) for an individual whose date of birth is after Decem-
ber 31, 1964, and before January 1, 1970, 56 years of age plus the
number of months in the age increase factor determined under
paragraph (2XB); and
"(E) for an individual whose date of birth is after Decem-
ber 31, 1969, 57 years of age.
"(2)(A) For an individual whose date of birth occurs during the 5-
year period consisting of calendar years 1948 through 1952, the age
increase factor shall be equal to two-twelfths times the number of
months in the period beginning with January 1948 and ending with
December of the year in which the date of birth occurs.
"(B) For an individual whose date of birth occurs during the 5-year
period consisting of calendar years 1965 through 1969, the age
increase factor shall be equal to two-twelfths times the number of
months in the period beginning with January 1965 and ending with
December of the year in which the date of birth occurs.
"? 8413. Deferred retirement
"(a) An employee or Member who is separated from the service, or
transferred to a position in which the employee or Member does not
continue subject to this chapter, after completing 5 years of service
is entitled to an annuity beginning at the age of 62 years.
"(b)(1) An employee or Member who is separated from the service,
or transferred to a position in which the employee or Member does
not continue subject to this chapter, after completing 10 years of
service is entitled to an annuity beginning on the date designated by
the employee or Member in a written election under this subsection.
The date designated under this subsection may not precede the date
on which the employee or Member attains the applicable minimum
5 USC 8413.
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.L.A. Ill Ai . I. .C...I . ? .../ f.1%.1
5 USC 8414.
5 USC 4311.
5 USC 5361.
retirement age under section 8412(h) and must precede the date on
which the employee or Member becomes 62 years of age.
"(2) The election of an annuity under this subsection shall not be
effective unless?
"(A) it is made at such time and in such manner as the Office
shall by regulation prescribe; and
"(B) the employee or Member will not otherwise be eligible to
receive an annuity within 31 days after filing the election.
"(3) The election of an annuity under this subsection extinguishes
the right of the employee or Member to receive any other annuity
based on the service on which the annuity under this subsection is
based.
"? 8414. Early retirement
"(aX1) A member of the Senior Executive Service who is removed
from the Senior Executive Service for less than fully successful
executive performance (as determined under subchapter II of chap-
ter 43 of this title) after completing 25 years of service, or after
becoming 50 years of age and completing 20 years of service, is
entitled to an annuity.
"(2) A member of the Defense Intelligence Senior Executive Serv-
ice or the Senior Cryptologic Executive Service who is removed from
such service for less than fully successful executive performance
after completing 25 years of service, or after becoming 50 years of
age and completing 20 years of service, is entitled to an annuity.
"(3)(1) Except as provided in paragraphs (2) and (3), an employee
who?
"(A) is separated from the service involuntarily, except by
removal for cause on charges of misconduct or delinquency; or
"(B) while serving in a geographic area designated by the
Director, is separated from the service voluntarily during a
period in which (as determined by the Director)?
"(i) the agency in which the employee is serving is under-
going a major reorganization, a major reduction in force, or
a major transfer of function; and
"(ii) a significant percentage of the total number of
employees serving in such agency will be separated or
subject to an immediate reduction in the rate of basic pay
(without regard to subchapter VI of chapter 53 of this title
or comparable provisions);
after completing 25 years of service, or after becoming 50 years of
age and completing 20 years of service, is entitled to an annuity.
"(2) An employee under paragraph (1) who is separated as de-
scribed in subparagraph (A) of such paragraph is not entitled to an
annuity under this subsection if the employee has declined a reason-
able offer of another position in the employee's agency for which the
employee is qualified, and the offered position is not lower than 2
grades (or pay levels) below the employee's grade (or pay level) and
is within the employee's commuting area.
"(3) Paragraph (1) shall not apply to an employee entitled to an
annuity under subsection (d) or (e) of section 8412.
"(c) A military reserve technician who is separated from techni-
cian service, after becoming 50 years of age and completing 25 years
of service, by reason of ceasing to satisfy the condition described in
section 8401(30XB) is entitled to an annuity.
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"? 8415. Computation of basic annuity 5 USC 8415.
"(a) Except as otherwise provided in this section, the annuity of an
employee retiring under this subchapter is 1 percent of that individ-
ual's average pay multiplied by such individual's total service.
"(b) The annuity of a Member, or former Member with title to a
Member annuity, retiring under this subchapter is computed under
subsection (a), except that if the individual has had at least 5 years
of service as a Member or Congressional employee, or any combina-
tion thereof, so much of the annuity as is computed with respect to
either such type of service (or a combination thereof), not exceeding
a total of 20 years, shall be computed by multiplying 17/10 percent of
the individual's average pay by the years of such service.
"(c) The annuity of a Congressional employee, or former Congres-
sional employee, retiring under this subchapter is computed under
subsection (a), except that if the individual has had at least 5 years
of service as a Congressional employee or Member, or any combina-
tion thereof, so much of the annuity as is computed with respect to
either such type of service (or a combination thereof), not exceeding
a total of 20 years, shall be computed by multiplying 17/10 percent of
the individual's average pay by the years of such service.
"(d) The annuity of an employee retiring under subsection (d) or
(e) of section 8412 or under subsection (a) or (b) of section 8425 is?
"(1) 17A o percent of that individual's average pay multiplied
by so much of such individual's total service as does not exceed
20 years; plus
"(2) 1 percent of that individual's average pay multiplied by
so much of such individual's total service as exceeds 20 years.
"(e)(1) In computing an annuity under this subchapter for an
employee whose service includes service performed on a part-time
basis?
"(A) the average pay of the employee, to the extent that it
includes pay for service performed in any position on a part-
time basis, shall be determined by using the annual rate of basic
pay that would be payable for full-time service in the position;
and
"(B) the benefit so computed shall then be multiplied by a
fraction equal to the ratio which the employee's actual service,
as determined by prorating the employee's total service to
reflect the service that was performed on a part-time basis,
bears to the total service that would be creditable for the
employee if all of the service had been performed on a full-time
basis.
"(2) For the purpose of this subsection, employment on a part-time
basis shall not be considered to include employment on a temporary
or intermittent basis.
"(0(1) The annuity of an employee or Member retiring under
section 8412(g) or 8413(b) is computed in accordance with applicable
provisions of this section, except that the annuity shall be reduced
by five-twelfths of 1 percent for each full month by which the
commencement date of the annuity precedes the sixty-second
anniversary of the birth of the employee or Member.
"(2)(A) Paragraph (1) does not apply in the case of an employee or
Member retiring under section 8413(b) if the employee or Member
would satisfy the age and service requirements for title to an
annuity under section 8412 (a), (b), (d)(2), (e)(2), or (0(2), determined
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5 USC 8416.
as if the employee or Member had, as of the date of separation,
attained the age specified in subparagraph (B).
"(B) A determination under subparagraph (A) shall be based on
how old the employee or Member will be as of the date on which the
annuity under section 8413(b) is to commence.
"(gX1) In applying subsection (a) with respect to an employee
under paragraph (2), the percentage applied under such subsection
shall be 1.1 percent, rather than 1 percent.
"(2) This subsection applies in the case of an employee who?
"(A) retires entitled to an annuity under section 8412; and
"(B) at the time of the separation on which entitlement to the
annuity is based, is at least 62 years of age and has completed at
least 20 years of service;
but does not apply in the case of a Congressional employee, military
reserve technician, law enforcement officer, firefighter, or air traffic
controller.
"? 8416. Survivor reduction for a current spouse
"(aX1) If an employee or Member is married at the time of retiring
under this chapter, the reduction described in section 8419(a) shall
be made unless the employee or Member and the spouse jointly
waive, by written election, any right which the spouse may have to a
survivor annuity under section 8442 based on the service of such
employee or Member. A waiver under this paragraph shall be filed
with the Office under procedures prescribed by the Office.
"(2) Notwithstanding paragraph (1), an employee or Member who
is married at the time of retiring under this chapter may waive the
annuity for a surviving spouse without the spouse's consent if the
employee or Member establishes to the satisfaction of the Office (in
accordance with regulations prescribed by the Office)?
"(A) that the spouse's whereabouts cannot be determined; or
"(B) that, due to exceptional circumstances, requiring the
employee or Member to seek the spouse's consent would other-
wise be inappropriate.
"(3) Except as provided in subsection (d), a waiver made under this
subsection shall be irrevocable.
"(b)(1) Upon remarriage, a retired employee or Member who was
married at the time of retirement (including an employee or
Member whose annuity was not reduced to provide a survivor
annuity for the employee's or Member's spouse or former spouse as
of the time of retirement) may irrevocably elect during such mar-
riage, in a signed writing received by the Office within 2 years after
such remarriage or, if later, within 2 years after the death or
remarriage of any former spouse of such employee or Member who
was entitled to a survivor annuity under section 8445 (or of the last
such surviving former spouse, if there was more than one), a reduc-
tion int he employee's or Member's annuity under section 8419(a) for
the purpose of providing an annuity for such employee's or Mem-
ber's spouse in the event such spouse survives the employee or
Member.
"(2) The election and reduction shall be effective the first day of
the second month after the election is received by the Office, but not
less than 9 months after the date of the remarriage.
"(3) An election to provide a survivor annuity to an individual
under this subsection?
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"(A) shall prospectively void any election made by the em-
ployee or Member under section 8420 with respect to such
individual; or
"(B) shall, if an election was made by the employee or
Member under section 8420 with respect to a different individ-
ual, prospectively void such election if appropriate written ap-
plication is made by such employee or Member at the time of
making the election under this subsection.
"(4) Any election under this subsection made by an employee or
Member on behalf of an individual after the retirement of such
employee or Member shall not be effective if?
"(A) the employee or Member was married to such individual
at the time of retirement; and
"(B) the annuity rights of such individual based on the service
of such employee or Member were then waived under subsec-
tion (a).
"(cX1) An employee or Member who is unmarried at the time of
retiring under this chapter and who later marries may irrevocably
elect, in a signed writing received by the Office within 2 years after
such employee or Member marries or, if later, within 2 years after
the death or remarriage of any former spouse of such employee or
Member who was entitled to a survivor annuity under section 8445
(or of the last such surviving former spouse, if there was more than
one), a reduction in the current annuity of the retired employee or
Member, in accordance with section 8419(a).
"(2) The election and reduction shall take effect the first day of
the first month beginning 9 months after the date of marriage. Any
such election to provide a survivor annuity for an individual?
"(A) shall prospectively void any election made by the em-
ployee or Member under section 8420 with respect to such
individual; or
"(B) shall, if an election was made by the employee or
Member under section 8420 with respect to a different individ-
ual, prospectively void such election if appropriate written ap-
plication is made by such employee or Member at the time of
making the election under this subsection.
"(dX1) An employee or Member?
"(A) who is married on the date of retiring under this chapter,
and
"(B) with respect to whose spouse a waiver under subsection
(a) has been made,
may, during the 18-month period beginning on such date, elect to
have a reduction made under section 8419 in order to provide a
survivor annuity under section 8442 for such spouse.
"(2XA) An election under this subsection shall not be effective
unless the amount described in subparagraph (B) is deposited into
the Fund before the expiration of the 18-month period referred to in
paragraph (1).
"(B) The amount to be deposited under this subparagraph is equal
to the sum of?
"(i) the difference (for the period between the date on which
the annuity of the former employee or Member commences and
the date on which reductions pursuant to the election under
this subsection commence) between the amount paid to the
former employee or Member from the Fund under this chapter
and the amount which would have been paid if such election
had been made at the time of retirement; and
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5 USC 8417.
Regulations.
5 USC 8418.
"(ii) the costs associated with providing for the election under
this subsection.
The amount to be deposited under clause (i) shall include interest,
computed at the rate of 6 percent a year.
"(3) An annuity which is reduced pursuant to an election by a
former employee or Member under this subsection shall be reduced
by the same percentage as was in effect under section 8419 as of the
date of the employee's or Member's retirement.
"(4) Rights and obligations under this chapter resulting from an
election under this subsection shall be the same as the rights and
obligations which would have resulted had the election been made
at the time of retirement.
"(5) The Office shall inform each employee and Member who is
eligible to make an election under this subsection of the right to
make such election and the procedures and deadlines applicable in
making any such election.
"? 8417. Survivor reduction for a former spouse
"(a) If an employee or Member has a former spouse who is entitled
to a survivor annuity as provided in section 8445, the reduction
described in section 8419(a) shall be made.
"(b)(1) An employee or Member who has a former spouse may
elect, under procedures prescribed by the Office, a reduction in the
annuity of the employee or Member under section 8419(a) in order to
provide a survivor annuity for such former spouse under section
8445.
"(2) An election under this subsection shall be made at the time of
retirement or, if the marriage is dissolved after the date of retire-
ment, within 2 years after the date on which the marriage of the
former spouse to the employee or Member is so dissolved.
"(3) An election under this subsection?
"(A) shall not be effective to the extent that it?
"(i) conflicts with?
"(I) any court order or decree referred to in section
8445(a) which was issued before the date of such elec-
tion; or
"(II) any agreement referred to in such section
8445(a) which was entered into before such date; or
"(ii) would cause the total of survivor annuities payable
under sections 8442 and 8445, respectively, based on the
service of the employee or Member to exceed the amount
which would be payable to a widow or widower of such
employee or Member under such section 8442 (determined
without regard to any reduction to provide for an annuity
under such section 8445); and
"(B) shall not be effective, in the case of an employee or
Member who is then married, unless it is made with the
spouse's written consent.
The Office shall by regulation provide that subparagraph (B) may be
waived for either of the reasons set forth in section 8416(aX2).
"? 8418. Survivor elections; deposit; offsets
"(aX1) An individual who makes an election under subsection (b)
or (c) of section 8416 or section 8417(b) which is required to be made
within 2 years after the date of a prescribed event shall deposit into
the Fund, before the expiration of the 2-year period involved, an
amount determined by the Office (as nearly as may be administra-
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tively feasible) to reflect the amount by which the annuity of such
individual would have been reduced if the election had been in effect
since the date of retirement (or, if later, and in the case of an
election under such section 8416(b), since the date the previous
reduction in the annuity of such individual was terminated under
paragraph (1) or (2) of section 8419(b)), plus interest.
"(2) Interest under paragraph (1) shall be computed at the rate of
6 percent a year.
"(b) If the electing individual does not make the deposit required
under subsection (a), the Office shall collect such amount by offset
against such individual's annuity, up to a maximum of 25 percent of
the net annuity otherwise payable, and the individual is deemed to
consent to such offset.
"(c) Subsections (a) and (b) shall not apply if?
"(1) the employee or Member makes an election under section
8416 (b) or (c) after having made an election under section 8420;
and
"(2) the election under such section 8420 becomes void under
subsection (b)(3) or (c)(2) of such section 8416.
"(d) The Office shall prescribe regulations under which the survi- Regulations.
vor of an employee or Member may make a deposit under this
section.
"? 8419. Survivor reductions: computation 5 USC 8419.
"(a)(1) Except as provided in paragraph (2), the annuity of an
annuitant computed under section 8415, or under section 8452
(including subsection (a)(2) of such section, if applicable), shall be
reduced by 10 percent if a survivor annuity, or a combination of
survivor annuities, under section 8442 or 8445 (or both) are to be
provided for.
"(2XA) If no survivor annuity under section 8442 is to be provided
for, but one or more survivor annuities under section 8445 involving
a total of less than the entirety of the amount referred to in
subsection (b)(2) of such section are to be provided for, the annuity of
the annuitant involved (as computed under section 8415, or under
section 8452 (including subsection (aX2) of such section, if ap-
plicable)), shall be reduced by an appropriate percentage determined
under subparagraph (B).
"(B) The Office shall prescribe regulations under which an appro- Regulations.
priate reduction under this paragraph, not to exceed a total of 10
percent, shall be made.
"(b)(1) Any reduction in an annuity for the purpose of providing a
survivor annuity for the current spouse of a retired employee or
Member shall be terminated for each full month?
"(A) after the death of the spouse; or
"(B) after the dissolution of the spouse's marriage to the
employee or Member, except that an appropriate reduction
shall be made thereafter if the spouse is entitled, as a former
spouse, to a survivor annuity under section 8445.
"(2) Any reduction in an annuity for the purpose of providing a
survivor annuity for a former spouse of a retired employee or
Member shall be terminated for each full month after the former
spouse remarries before reaching age 55 or dies. This reduction shall
be replaced by appropriate reductions under subsection (a) if the
retired employee or Member has one or more of the following:
"(A) another former spouse who is entitled to a survivor
annuity under section 8445;
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.L\111 LIiJ.. tJeJ 4.a
"(B) a current spouse to whom the employee or Member was
married at the time of retirement and with respect to whom a
survivor annuity was not waived under section 8416(a) (or, if
waived, with respect to whom an election under section 8416(d)
has been made); or
"(C) a current spouse whom the employee or Member married
after retirement and with respect to whom an election has been
made under subsection (b) or (c) of section 8416.
5 USC 8420. "? 8420. Insurable interest reductions
"(aX1) At the time of retiring under section 8412, 8413, or 8414, an
employee or Member who is found to be in good health by the Office
may elect to have such employee's or Member's annuity (as com-
puted under section 8415) reduced under paragraph (2) in order to
provide an annuity under section 8444 for an individual having an
insurable interest in the employee or Member. Such individual shall
be designated by the employee or Member in writing.
"(2) The annuity of the employee or Member making the election
is reduced by 10 percent, and by 5 percent for each full 5 years the
individual named is younger than the retiring employee or Member,
except that the total reduction may not exceed 40 percent.
"(3) An annuity which is reduced under this subsection shall,
effective the first day of the month following the death of the
individual named under this subsection, be recomputed and paid as
if the annuity had not been so reduced.
"(b)(1) In the case of a married employee or Member, an election
under this section on behalf of the spouse may be made only if any
right of such spouse to a survivor annuity based on the service of
such employee or Member is waived in accordance with section
8416(a).
"(2) Paragraph (1) does not apply in the case of an employee or
Member if such employee or Member has a former spouse who
would become entitled to an annuity under section 8445 as a survi-
vor of such employee or Member.
5 USC 8420a. "? 8420a. Alternative forms of annuities
Regulations. "(a) The Office shall prescribe regulations under which an em-
ployee or Member may, at the time of retiring under this sub-
chapter, elect annuity benefits under this section instead of any
other benefits under this subchapter, and any benefits under sub-
chapter IV of this chapter, based on the service of the employee or
Member.
"(b) Subject to subsection (c), the Office shall by regulation provide
for such alternative forms of annuities as the Office considers
appropriate, except that among the alternatives offered shall be?
"(1) an alternative which provides for?
"(A) payment of the lump-sum credit (excluding interest)
to the employee or Member; and
"(B) payment of an annuity to the employee or Member
for life; and
"(2) in the case of an employee or Member who is married at
the time of retirement, an alternative which provides for?
"(A) payment of the lump-sum credit (excluding interest)
to the employee or Member; and
"(B) payment of an annuity to the employee or Member
for life, with a survivor annuity payable for the life of a
surviving spouse.
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"(c) Each alternative provided for under subsection (b) shall, to the
extent practicable, be designed such that the present value of the
benefits provided under such alternative (including any lump-sum
credit) is actuarially equivalent to the sum of?
"(1) the present value of the annuity which would otherwise
be provided under this subchapter, as computed under section
8415; and
"(2) the present value of the annuity supplement which would
otherwise be provided (if any) under section 8421.
"(d) An employee or Member who, at the time of retiring under
this subchapter?
"(1) is married, shall be ineligible to make an election under
this section unless a waiver is made under section 8416(a); or
"(2) has a former spouse, shall be ineligible to make an
election under this section if the former spouse is entitled to
benefits under section 8445 or 8467 (based on the service of the
employee or Member) under the terms of a decree of divorce or
annulment, or a court order or court-approved property settle-
ment incident to any such decree, with respect to which the
Office has been duly notified.
"(e) An employee or Member who is married at the time of
retiring under this subchapter and who makes an election under
this section may, during the 18-month period beginning on the date
of retirement, make the election provided for under section 8416(d),
subject to the deposit requirement thereunder.
"? 8421. Annuity supplement 5 USC 8421.
"(a)(1) Subject to paragraph (3), an individual shall, if and while
entitled to an annuity under subsection (a), (b), (d), or (e) of section
8412, or under section 8414(c), also be entitled to an annuity supple-
ment under this section.
"(2) Subject to paragraph (3), an individual shall, if and while
entitled to an annuity under section 8412(f), or under subsection (a)
or (b) of section 8414, also be entitled to an annuity supplement
under this section if such individual is at least the applicable
minimum retirement age under section 8412(h).
"(3XA) An individual whose entitlement to an annuity under
section 8412 or 8414 does not commence before age 62 is not entitled
to an annuity supplement under this section.
"(B) An individual entitled to an annuity supplement under this
section ceases to be so entitled after the last day of the month
preceding the first month for which such individual would, on
proper application, be entitled to old-age insurance benefits under
title II of the Social Security Act, but not later than the last day of 42 USC 401.
the month in which such individual attains age 62.
"(bX1) The amount of the annuity supplement of an annuitant
under this section for any month shall be equal to the product of?
"(A) an amount determined under paragraph (2), multiplied
by
"(E) a fraction, as described in paragraph (3).
"(2) The amount under this paragraph for an annuitant is an
amount equal to the old-age insurance benefit which would be
payable to such annuitant under title II of the Social Security Act
(without regard to sections 203, 215(07), and 215(dX5) of such Act) 42 USC 403, 415.
upon attaining age 62 and filing application therefor, determined as
if the annuitant had attained such age and filed application there-
for, and were a fully insured individual (as defined in section 214(a)
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iuu bIAT. 064 r u ntad LAW 99-335?JUNE 6, 1986
42 USC 414. of such Act), on January 1 of the year in which such annuitant's
entitlement to any payment under this section commences, except
that the reduction of such old-age insurance benefit under section
42 USC 402. 202(q) of such Act shall be the maximum applicable for an individ-
ual born in the same year as the annuitant. In computing the
42 USC 415. primary insurance amount under section 215 of such Act for pur-
poses of this paragraph, the number of elapsed years (referred to in
section 215(bX2XBXiii) of such Act and used to compute the number
of benefit computation years) shall not include years beginning with
the year in which such annuitant's entitlement to any payment
under this section commences, and?
"(A) only basic pay for service performed (if any) shall be
taken into account in computing the total wages and self-
employment income of the annuitant for a benefit computation
year;
"(B) for a benefit computation year which commences after
the date of the separation with respect to which entitlement to
the annuitant's annuity under this subchapter is based and
before the date as of which such annuitant is treated, under the
preceding sentence, to have attained age 62, the total wages and
self-employment income of such annuitant for such year shall
be deemed to be zero; and
"(C) for a benefit computation year after age 21 which pre-
cedes the separation referred to in subparagraph (B), and during
which the individual did not perform a full year of service, the
total wages and self-employment income of such annuitant for
such year shall be deemed to have been an amount equal to the
product of?
"(i) the average total wages of all workers for that year,
multiplied by
"(ii) a fraction?
"(I) the numerator of which is the total basic pay of
the individual for service performed in the first year
thereafter in which such individual performed a full
year of service; and
"(II) the denominator of which is the average total
wages of all workers for the year referred to in
subclause (I).
"(3) The fraction under this paragraph for any annuitant is a
fraction?
"(A) the numerator of which is the annuitant's total years of
service (rounding a fraction to the nearest whole number, with
1/2 being rounded to the next higher number), not to exceed the
number under subparagraph (B); and
"(B) the denominator of which is 40.
"(4) For the purpose of this subsection?
"(A) the term 'benefit computation year' has the meaning
42 USC 415. provided in section 215(bX2XBXi) of the Social Security Act;
"(B) the term 'average total wages of all workers', for a year,
means the average of the total wages, as defined and computed
under section 215(bX3XAXiiXI) of the Social Security Act for
such year; and
"(C) the term 'service' does not include military service.
"(c) An amount under this section shall, for purposes of section
8467, be treated in the same way as an amount computed under
section 8415.
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"? 8421a. Reductions on account of earnings from work performed 5 USC 8421a.
while entitled to an annuity supplement
"(a) The amount of the annuity supplement to which an individ-
ual is entitled under section 8421 for any month (determined with-
out regard to subsection (c) of such section) shall be reduced by the
amount of any excess earnings of such individual which are required
to be charged to such supplement for such month, as determined
under subsection (b).
"(b) The amount of an individual's excess earnings shall be
charged to months as follows:
"(1)(A) There shall be charged to each month of a year under
subsection (a) an amount equal to the individual's excess earn-
ings (as determined under paragraph (2) with respect to such
year), divided by the number of the individual's supplement
entitlement months for such year (as determined under para-
graph (3)).
"(B) Notwithstanding subparagraph (A), the amount charged
to a month under subsection (a) may not exceed the amount of
the annuity supplement to which the individual is entitled
under section 8421 for such month (determined without regard
to subsection (c) of such section).
"(2) The excess earnings based on which reductions under
subsection (a) shall be made with respect to an individual in a
year?
"(A) shall be equal to 50 percent of so much of such
individual's earnings for the immediately preceding year as
exceeds the applicable exempt amount for such preceding
year; but
"(B) may not exceed the total amount of the annuity
supplement payments to which such individual was entitled
for such preceding year under section 8421 (determ ined
without regard to subsection (c) of such section, and w about
regard to this section).
"(3)(A) Subject to subparagraph (B), the number of an individ-
ual's supplement entitlement months for a year shall be 12.
"(R) The number determined under subparagraph (A) shall be
reduced so as not to include any month after which such
individual ceases to be entitled to an annuity supplement by
reason of section 8421(a)(3XB), relating to cessation of entitle-
ment upon attaining age 62.
"(4XA) For purposes of this section, and except as provided in
subparagraph (B), the 'earnings' and the 'applicable exempt
amount' of an individual shall be determined in a manner
consistent with applicable provisions of section 203 of the Social
Security Act. 42 USC 403.
"(B) For purposes of this section?
"(i) in determining the excess earnings of any individual,
only earnings attributable to periods during which such
individual was entitled to an annuity supplement under
section 8421 shall be considered; and
"(ii) any earnings attributable to a period before attain-
ing the applicable retirement age under section 8412(h)
shall not be considered in determining the excess earnings
of an individual who retires under section 8412 (d) or (e), or
section 8414(c).
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"(c) If, after an individual ceases to be entitled to an annuity
supplement under section 8421 by reason of subsection (aX3XB) of
such section, any portion of the individual's excess earnings remains
outstanding, an amount not to exceed 25 percent of the amount
otherwise payable to such individual under this chapter for each
month shall be deducted from such monthly payment until the full
amount of that outstanding portion has been accounted for. To the
extent practicable, reductions under this subsection shall be made
by a level percentage.
Regulations. `(d) The Office shall prescribe regulations under which this sec-
tion shall be applied in the case of a reemployed annuitant.
5 USC 8422. "? 8422. Deductions from pay; contributions for military service
"(a)(1) The employing agency shall deduct and withhold from basic
pay of each employee and Member a percentage of basic pay deter-
mined in accordance with paragraph (2).
"(2) The applicable percentage under this subsection for any pay
period shall be?
"(A) in the case of an employee (other than a law enforcement
officer, firefighter, air traffic controller, or Congressional em-
ployee) a percentage equal to?
"(i) 7 percent, minus
"(ii) the percentage then in effect under section 3101(a) of
26 USC 3101. the Internal Revenue Code of 1954 (relating to rate of tax
for old-age, survivors, and disability insurance); and
"(B) in the case of a Member, law enforcement officer, fire-
fighter, air traffic controller, or Congressional employee, a
percentage equal to?
"(i) 71/2 percent, minus
"(ii) the same percentage as would apply in the case of an
employee under subparagraph (AXii).
"(b) Each employee or Member is deemed to consent and agree to
the deductions under subsection (a). Notwithstanding any law or
regulation affecting the pay of an employee or Member, payment
less such deductions is a full and complete discharge and acquit-
tance of all claims and demands for regular services during the
period covered by the payment, except the right to any benefits
under this subchapter, or under subchapter IV or V of this chapter,
based on the service of the employee or Member.
"(c) The amounts deducted and withheld under this section shall
be deposited in the Treasury of the United States to the credit of the
Fund under such procedures as the Comptroller General of the
United States may prescribe.
"(d) Under such regulations as the Office may prescribe, amounts
deducted under subsection (a) shall be entered on individual retire-
ment records.
"(e)(1) Each employee or Member who has performed military
service before the date of the separation on which the entitlement to
any annuity under this subchapter, or subchapter V of this chapter,
is based may pay, in accordance with such regulations as the Office
shall issue, to the agency by which the employee is employed, or, in
the case of a Member or a Congressional employee, to the Secretary
of the Senate or the Clerk of the House of Representatives, as
appropriate, an amount equal to 3 percent of the amount of the
basic pay paid under section 204 of title 37 to the employee or
Member for each period of military service after December 1956.
The amount of such payments shall be based on such evidence of
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basic pay for military service as the employee or Member may
provide, or if the Office determines sufficient evidence has not been
so provided to adequately determine basic pay for military service,
such payment shall be based on estimates of such basic pay provided
to the Office under paragraph (4).
"(2) Any deposit made under paragraph (1) more than two years
after the later of?
"(A) January 1, 1987; or
"(B) the date on which the employee or Member making the
deposit first becomes an employee or Member,
shall include interest on such amount computed and compounded
annually beginning on the date of the expiration of the two-year
period. The interest rate that is applicable in computing interest in
any year under this paragraph shall be equal to the interest rate
that is applicable for such year under section 8334(e).
"(3) Any payment received by an agency, the Secretary of the
Senate, or the Clerk of the House of Representatives under this
subsection shall be immediately remitted to the Office for deposit in
the Treasury of the United States to the credit of the Fund.
"(4) The Secretary of Defense, the Secretary of Transportation,
the Secretary of Commerce, or the Secretary of Health and Human
Services, as appropriate, shall furnish such information to the Office
as the Office may determine to be necessary for the administration
of this subsection.
"? 8423. Government contributions 5 USC 8423.
"(a)(1) Each employing agency having any employees or Members
subject to section 8422(a) shall contribute to the Fund an amount
equal to the sum of?
"(A) the product of?
"(i) the normal-cost percentage, as determined for
employees (other than employees covered by subparagraph
(B)), multiplied by
"(ii) the aggregate amount of basic pay payable by the
agency, for the period involved, to employees (under clause
(i)) who are within such agency; and
"(B) the product of?
"(i) the normal-cost percentage, as determined for Mem-
bers, Congressional employees, law enforcement officers,
firefighters, air traffic controllers, military reserve techni-
cians, and employees under sections 302 and 303 of the
Central Intelligence Agency Retirement Act of 1964 for Post, pp. 625,
Certain Employees, multipled by 626.
"(ii) the aggregate amount of basic pay payable by the
agency, for the period involved, to employees and Members
(under clause (i)) who are within such agency.
"(2) In determining any normal-cost percentage to be applied
under this subsection, amounts provided for under section 8422 shall
be taken into account.
"(3) Contributions under this subsection shall be paid?
"(A) in the case of law enforcement officers, firefighters, air
traffic controllers, military reserve technicians, and other
employees, from the appropriation or fund used to pay such law
enforcement officers, firefighters, air traffic controllers, mili-
tary reserve technicians, or other employees, respectively;
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"(B) in the case of elected officials, from an appropriation or
fund available for payment of other salaries of the same office
or establishment; and
"(C) in the case of employees of the legislative branch paid by
the Clerk of the House of Representatives, from the contingent
fund of the House.
"(4) A contribution to the Fund under this subsection shall be
deposited under such procedures as the Comptroller General of the
United States may prescribe.
"(bX1) The Office shall compute?
"(A) the amount of the supplemental liability of the Fund
with respect to individuals other than those to whom subpara-
graph (B) relates, and
"(B) the amount of the supplemental liability of the Fund
with respect to current or former employees of the United
States Postal Service (and the Postal Rate Commission) and
their survivors;
as of the close of each fiscal year beginning after September 30,
1987.
"(2) The amount of any supplemental liability computed under
paragraph (1XA) or (1XB) shall be amortized in 30 equal annual
installments, with interest computed at the rate used in the most
recent valuation of the System.
"(3) At the end of each fiscal year, the Office shall notify?
"(A) the Secretary of the Treasury of the amount of the
installment computed under this subsection for such year with
respect to individuals under paragraph (1XA); and
"(B) the Postmaster General of the United States of the
amount of the installment computed under this subsection for
such year with respect to individuals under paragraph (1XB).
"(4)(A) Before closing the accounts for a fiscal year, the Secretary
of the Treasury shall credit to the Fund, as a Government contribu-
tion, out of any money in the Treasury of the United States not
otherwise appropriated, the amount under paragraph (3XA) for such
year.
"(B) Upon receiving notification under paragraph (3XB), the
United States Postal Service shall pay the amount specified in such
notification to the Fund.
"(5) For the purpose of carrying out paragraph (1) with respect to
any fiscal year, the Office may?
"(A) require the Board of Actuaries of the Civil Service
Retirement System to make actuarial determinations and valu-
ations, make recommendations, and maintain records in the
same manner as provided in section 8347(f); and
"(B) use the latest actuarial determinations and valuations
made by such Board of Actuaries.
"(c) Under regulations prescribed by the Office, the head of an
agency may request reconsideration of any amount determined to be
payable with respect to such agency under subsection (a) or (b). Any
such request shall be referred to the Board of Actuaries of the Civil
Service Retirement System. The Board of Actuaries shall review the
computations of the Office and may make any adjustment with
respect to any such amount which the Board determines appro-
priate. A determination by the Board of Actuaries under this subsec-
tion shall be final.
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"? 8424. Lump-sum benefits; designation of beneficiary; order of 5 USC 8424.
precedence
"(a) Subject to subsection (b), an employee or Member who?
"(IXA) is separated from the service for at least 31 consecutive
days; or
"(B) is transferred to a position in which the individual is not
subject to this chapter and remains in such a position for at
least 31 consecutive days;
"(2) files an application with the Office for payment of the
lump-sum credit;
"(3) is not reemployed in a position in which the individual is
subject to this chapter at the time of filing the application; and
"(4) will not become eligible to receive an annuity within 31
days after filing the application;
is entitled to be paid the lump-sum credit. Except as provided in
section 8420a, payment of the lump-sum credit to an employee or
Member voids all annuity rights under this subchapter, and sub-
chapters IV and V of this chapter, based on the service on which the
lump-sum credit is based.
"(bX1) Payment of the lump-sum credit under subsection (a)?
"(A) may be made only if any current spouse and any former
spouse of the employee or Member are notified of the applica-
tion by the employee or Member; and
"(B) in any case in which there is a former spouse, shall be
subject to the terms of a court decree of divorce, annulment, or
legal separation issued with respect to such former spouse if?
"(i) the decree expressly relates to any portion of the
lump-sum credit involved; and
"(ii) payment of the lump-sum credit would affect any
right or interest of the former spouse with respect to a
survivor annuity under section 8445, or to any portion of an
annuity under section 8467.
"(2)(A) Notification of a spouse or former spouse under this subsec- Regulations.
tion shall be made in accordance with such requirements as the
Office shall by regulation prescribe.
"(B) Under the regulations, the Office may provide that para-
graph (1 XA) may be waived with respect to a spouse or former
spouse if the employee or Member establishes to the satisfaction of
the Office that the whereabouts of such spouse or former spouse
cannot be determined.
"(3) The Office shall prescribe regulations under which this Regulations.
subsection shall be applied in any case in which the Office receives
two or more orders or decrees referred to in paragraph (1)(B)(i).
"(c) Under regulations prescribed by the Office, an employee or
Member, or a former employee or Member, may designate one or
more beneficiaries under this section.
"(d) Lump-sum benefits authorized by subsections (e) through (g)
shall be paid to the individual or individuals surviving the employee
or Member and alive at the date title to the payment arises in the
following order of precedence, and the payment bars recovery by
any other individual:
"First, to the beneficiary or beneficiaries designated by the
employee or Member in a signed and witnessed writing received
in the Office before the death of such employee or Member. For
this purpose, a designation, change, or cancellation of bene-
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? t/-.?.,
5 USC 8425.
ficiary in a will or other document not so executed and filed has
no force or effect.
"Second, if there is no designated beneficiary, to the widow or
widower of the employee or Member.
"Third, if none of the above, to the child or children of the
employee or Member and descendants of deceased children by
representation.
"Fourth, if none of the above, to the parents of the employee
or Member or the survivor of them.
"Fifth, if none of the above, to the duly appointed executor or
administrator of the estate of the employee or Member.
"Sixth, if none of the above, to such other next of kin of the
employee or Member as the Office determines to be entitled
under the laws of the domicile of the employee or Member at
the date of death of the employee or Member.
For the purpose of this subsection, 'child' includes a natural child
and an adopted child, but does not include a stepchild.
"(e) If an employee or Member, or former employee or Member,
dies?
"(1) without a survivor, or
"(2) with a survivor or survivors and the right of all survivors
under subchapter IV terminates before a claim for survivor
annuity under such subchapter is filed,
the lump-sum credit shall b..: paid.
"(f) If all annuity rights under this chapter (other than under
subchapter III of this chapter) based on the service of a deceased
employee or Member terminate before the total annuity paid equals
the lump-sum credit, the difference shall be paid.
"(g) If an annuitant dies, annuity accrued and unpaid shall be
paid.
"(h) Annuity accrued and unpaid on the termination, except by
death, of the annuity of an annuitant or survivor shall be paid to
that individual. Annuity accrued and unpaid on the death of a
survivor shall be paid in the following order of precedence, and the
payment bars recovery by any other person:
"First, to the duly appointed executor or administrator of the
estate of the survivor.
"Second, if there is no executor or administrator, payment
may be made, after 30 days from the date of death of the
survivor, to such next of kin of the survivor as the Office
determines to be entitled under the laws of the domicile of the
survivor at the date of death.
"? 8425. Mandatory separation
"(a) An air traffic controller who is otherwise eligible for imme-
diate retirement under section 8412(e) shall be separated from the
service on the last day of the month in which that air traffic
controller becomes 56 years of age or completes 20 years of service if
then over that age. The Secretary, under such regulations as the
Secretary may prescribe, may exempt a controller having excep-
tional skills and experience as a controller from the automatic
separation provisions of this subsection until that controller be-
comes 61 years of age. The Secretary shall notify the controller in
writing of the date of separation at least 60 days before that date.
Action to separate the controller is not effective, without the con-
sent of the controller, until the last day of the month in which the
60-day notice expires.
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"(b) A law enforcement officer or firefighter who is otherwise
eligible for immediate retirement under section 8412(d) shall be
separated from the service on the last day of the month in which
that law enforcement officer or firefighter becomes 55 years of age
or completes 20 years of service if then over that age. If the head of
the agency judges that the public interest so requires, that agency
head may exempt such an employee from automatic separation
under this subsection until that employee becomes 60 years of age.
The employing office shall notify the employee in writing of the date
of separation at least 60 days before that date. Action to separate
the employee is not effective, without the consent of the employee,
until the last day of the month in which the 60-day notice expires.
"(c) The President, by Executive order, may exempt an employee President of U.S.
from automatic separation under this section if the President deter-
mines the public interest so requires.
"SUBCHAPTER III?THRIFT SAVINGS PLAN
"? 8431. Definition 5 USC 8431.
"Notwithstanding section 8401 of this title, for the purpose of this
subchapter, the term 'basic pay', when used with respect to an
employee or Member, means the basic pay of the employee or
Member established pursuant to law, without regard to any provi-
sion of law (except sections 5308 and 5382(b) of this title) limiting the
rate of pay actually payable in any pay period (including any
provision of law restricting the use of appropriated funds).
"? 8432. Contributions 5 USC 8432.
"(a) An employee or Member may contribute to the Thrift Savings
Fund in any pay period, pursuant to an election under subsection
(b)(1), an amount not to exceed 10 percent of such individual's basic
pay for such period. Contributions made under this subsection
during any 6-month period for which an election period is provided
under subsection (bX1) shall be made each pay period during
such 6-month period pursuant to a program of regular contributions
provided in regulations prescribed by the Executive Director.
"(bX1XA) The Executive Director shall prescribe regulations under Regulations.
which employees and Members shall be afforded a reasonable period
every 6 months to elect to make contributions under subsection (a),
to modify the amount to be contributed under such subsection, or to
terminate such contributions. An election to make such contribu-
tions shall remain in effect until modified or terminated.
"(B) The amount to be contributed pursuant to an election under
subparagraph (A) shall be the percentage of basic pay or amount
designated by the employee or Member.
"(2) Under the regulations?
"(A) an employee or Member who has not previously been
eligible to make an election under this subsection shall not
become so eligible until the second period (described in para-
graph (1)) beginning after the date of commencing service as an
employee or Member;
"(B) an employee or Member whose appointment or election
to a position or office in the Federal Government follows a
previous period of service during which that individual met the
requirements of subparagraph (A) shall be eligible to make an
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election under this subsection notwithstanding any period of
separation;
"(C) an employee or Member who elects under subparagraph
(D) to terminate contributions shall not again become eligible to
make an election under this subsection until the second period
(described in paragraph (1)) commencing after the election to
terminate; and
"(D) an election to terminate may be made under this
subparagraph at any time other than during a period afforded
under paragraph (1).
"(3) Notwithstanding paragraph (2XA), an employee or Member
who elects to become subject to this chapter under section 301 of the
Federal Employees' Retirement System Act of 1986 may make the
first election for the purpose of subsection (a) during the period
prescribed for such purpose by the Executive Director. The period
prescribed by the Executive Director shall commence on the date on
which the employee or Member makes the election to become
subject to this chapter.
"(4) Notwithstanding paragraph (2XA), an employee or Member
who is an employee or Member on January 1, 1987, and has cred-
itable service described in section 8411(bX2) of this title may make
the first election for the purpose of subsection (a) during the election
period prescribed for such purpose by the Executive Director. The
Executive Director shall prescribe an election period for such pur-
pose which shall commence on January 1, 1987. An election by such
an employee or Member during that election period shall be effec-
tive on the first day of the employee's or Member's first pay period
which begins after the last day of that election period.
"(cX1) At the end of the pay period that includes the first date on
which an employee or Member may make contributions under
subsection (a) (without regard to whether the employee or Member
has elected to make such contributions during such pay period), and
at the end of each succeeding pay period, the employing agency shall
contribute to the Thrift Savings Fund for the benefit of such
employee or Member the amount equal to 1 percent of the basic pay
of such employee or Member for such pay period.
"(2XA) In addition to contributions made under paragraph (1), the
employing agency of an employee or Member who contributes to the
Thrift Savings Fund under subsection (a) for any pay period shall
make a contribution to the Thrift Savings Fund for the benefit of
such employee or Member. The employing agency's contribution
shall be made at the end of such pay period.
"(B) The amount contributed under subparagraph (A) by an
employing agency with respect to a contribution of an employee or
Member during any pay period shall be the amount equal to the
sum of?
"(i) such portion of the total amount of the employee's or
Member's contribution as does not exceed 3 percent of such
employee's or Member's basic pay for such period; and
"(ii) one-half of such portion of the amount of the employee's
or Member's contribution as exceeds 3 percent, but does not
exceed 5 percent, of such employee's or Member's basic pay for
such pay period.
"(3XA) There shall be contributed to the Thrift Savings Fund on
behalf of each employee or Member described in subparagraph (B)
the amount determined under subparagraph (C).
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"(B) An employee or Member referred to in subparagraph (A) is an
employee or Member who?
"(i) is an employee or Member on January 1, 1987;
"(ii) has creditable service described in section 8411(bX2) of
this title; and
"(iii) has not received a refund of the amount of the retire-
ment deductions made with respect to such service under sec-
tion 204 of the Federal Employees' Retirement Contribution
Temporary Adjustment Act of 1983.
"(C) The amount referred to in subparagraph (A) in the case of an
employee or Member is equal to the sum of?
"(i) 1 percent of the total basic pay paid to such employee or
Member for service described in section 8411(bX2) of this title;
and
"(ii) interest on such amount computed with respect to such
service in the manner provided in paragraphs (2) and (3) of
section 8334(e) of this title.
"(D) The Secretary of the Treasury shall credit to the Thrift
Savings Fund, out of any sums in the Treasury not otherwise
appropriated, the amounts determined by the Director to be nec-
essary to carry out this paragraph.
"(d) Notwithstanding any other provision of this section, no con-
tribution may be made under this section for any year to the extent
that such contribution, when added to prior contributions for such
year, exceeds any limitation under section 415 of the Internal
Revenue Code of 1954.
"(e) The sums required to be contributed to the Thrift Savings
Fund by an employing agency under subsection (c) for the benefit of
an employee or Member shall be paid from the appropriation or
fund available to such agency for payment of salaries of the
employee's or Member's office or establishment. When an employee
or Member in the legislative branch is paid by the Clerk of the
House of Representatives, the Clerk may pay from the contingent
fund of the House of Representatives the contribution that other-
wise would be contributed from the appropriation or fund used to
pay the employee or Member.
"(f) Amounts contributed by an employee or Member under
subsection (a) and amounts contributed with respect to such em-
ployee or Member under subsection (c) shall be deposited in the
Thrift Savings Fund to the credit of that employee's or Member's
account in accordance with such procedures as the Comptroller
General of the United States may, in consultation with the Execu-
tive Director, prescribe in regulations.
"(g)(1) Except as provided in paragraphs (2) and (3), all contribu-
tions made under this section shall be fully nonforfeitable when
made.
"(2) Contributions made for the benefit of an employee under
subsection (cX1) and all earnings attributable to such contributions
shall be forfeited if the employee separates from Government
employment before completing?
`(A) 2 years of civilian service in the case of an employee who,
at the time of separation, is serving in?
"(i) a position in the Senior Executive Service as a non-
career appointee (as defined in section 3132(aX7) of this
title);
5 USC 8331 note.
26 USC 415.
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5 USC 8433.
5 USC 8101.
"(ii) a position listed in section 5312, 5313, 5314, 5315, or
5316 of this title or a position placed in level IV or V of the
Executive Schedule under section 5317 of this title; or
"(iii) a position in the Executive branch which is excepted
from the competitive service by the Office by reason of the
confidential and policy-determining character of the posi-
tion; or
"(B) 3 years of civilian service in the case of an employee who
is not serving in a position described in subparagraph (A) at the
time of separation.
"(3) Contributions made for the benefit of a Member or Congres-
sional employee under subsection (cX1) and all earnings attributable
to such contributions shall be forfeited if the Member or Congres-
sional employee separates from Government employment before
completing 2 years of civilian service.
"(h) No transfers or contributions may be made to the Thrift
Savings Fund except as provided in this chapter or section 8351 of
this title.
"? 8433. Benefits and election of benefits
"(a) An employee or Member who separates from Government
employment is entitled to the amount of the balance in the
employee's or Member's account (except for the portion of such
amount forfeited under section 8432(g) of this title, if any) as pro-
vided in this section.
"(b) Subject to section 8435 of this title, any employee or Member
who separates from Government employment entitled to an imme-
diate annuity under subchapter II of this chapter, any employee or
Member who separates from Government employment entitled to
benefits under subchapter I of chapter 81 of this title, and any
employee or Member who is entitled to receive disability benefits
under subchapter V of this chapter is entitled and may elect?
"(1) to receive an immediate annuity from the Thrift Savings
Fund;
"(2) to defer the commencement of the payment of an annuity
from the Thrift Savings Fund until such date as the employee
or Member specifies, but not later than April 1 of the year
following the year in which the employee or Member becomes
701/2 years of age;
"(3) to withdraw the amount of the balance in the employee's
or Member's account in the Thrift Savings Fund in one or more
substantially equal payments to be made not less frequently
than annually and to commence before April 1 of the year
following the year in which the employee or Member becomes
701/2 years of age; or
"(4) to transfer the amount of the balance in the employee's
or Member's account to an eligible retirement plan as provided
in subsection (e).
"(c) Subject to section 8435 of this title, any employee or Member
who separates from Government employment entitled to a deferred
annuity under subchapter II of this chapter is entitled and may
elect?
"(1) to receive an immediate annuity from the Thrift Savings
Fund;
"(2) to defer the commencement of the payment of an annuity
from the Thrift Savings Fund until such date as the employee
or Member specifies, but not later than April 1 of the year
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following the year in which the employee or Member becomes
701/2 years of age;
"(3) to withdraw the amount of the balance in the employee's
or Member's account in the Thrift Savings Fund in one or more
substantially equal payments to be made not less frequently
than annually and to commence during any period which (A)
commences on or after the date on which payment of the
employee's or Member's annuity under subchapter II of this
chapter commences, and (B) ends not later than April 1 of the
year following the year in which the employee or Member
becomes 701/2 years of age; or
"(4) to transfer the amount of the balance in the employee's
or Member's account to an eligible retirement plan as provided
in subsection (e).
"(d) Subject to section 8435 of this title, any employee or Member
who separates from Government employment before becoming en-
titled to a deferred annuity under subchapter II of this chapter shall
transfer the amount of the balance in the employee's or Member's
account to an eligible retirement plan as provided in subsection (e).
"(e)(1) The Executive Director shall make each transfer elected
under subsection (bX4) or (cX4) or required under subsection (d)
directly to an eligible retirement plan or plans (as defined in section
402(a)(5)(E) of the Internal Revenue Code of 1954) identified by the 26 USC 402.
employee, Member, former employee, or former Member for whom
the transfer is made.
"(2) A transfer may not be made for an employee, Member, former
employee, or former Member under paragraph (1) until the Execu-
tive Director receives from that individual the information required
by the Executive Director specifically to identify the eligible retire-
ment plan or plans to which the transfer is to be made.
"(0(1) Subject to paragraph (3XA) and subsections (a) and (d) of
section 8435 of this title, an employee or Member may change an
election previously made under this subchapter.
"(2) Subject to paragraph (3)(B) and section 8435(d) of this title, a
former employee or Member who has made an election pursuant to
subsection (bX2) or (cX2) may modify the date specified in such
election or in a previous modification under this paragraph.
"(3XA) A former employee or Member may not change an election
under this section on or after the date on which a payment is made
in accordance with such election or, in the case of an election to
receive an annuity, the date on which an annuity elected by the
former employee or Member commences.
"(B) A modification of a date may not be made under paragraph
(2) on or after such date and may not specify a date for the
commencement of an annuity earlier than 1 month after the date on
which the modification is submitted to the Executive Director.
"(g) If an employee or Member (or former employee or Member)
dies without having made an election under this section or after
having elected an annuity under this section but before making an
election under section 8434 of this title, an amount equal to the
value of that individual's account (as of death) shall, subject to any
decree, order, or agreement referred to in section 8435(dX2) of this
title be paid in a manner consistent with section 8424(d) of this title.
"(h) Unless otherwise elected under this section, benefits under
this subchapter shall be paid as an annuity commencing for an
employee, Member, former employee, or former Member on Feb-
ruary 1 of the year following the latest of the year in which?
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"(1) the employee, Member, former employee, or former
Member becomes 65 years of age;
"(2) occurs the tenth anniversary of the year in which the
employee, Member, former employee, or former Member
became subject to this subchapter; or
"(3) the employee, Member, former employee, or former
Member separates from Government employment.
"(iX1) At any time after December 31, 1987, and before separation,
an employee or Member may apply to the Board for permission to
borrow from the employee's or Member's account an amount not
exceeding the value of that portion of such account which is attrib-
utable to contributions made by the employee or Member under
section 8432(a) of this title.
"(2) An application under this subsection may be approved only
for?
"(A) the purchase of a primary residence;,
"(B) educational expenses;
"(C) medical expenses; or
"(D) financial hardship.
"(3) Loans under this subsection shall be subject to such conditions
as the Board may prescribe consistent with section 408(bX1) of the
Employee Retirement Income Security Act of 1974 (29 U.S.C.
1108(bX1)). The conditions shall be included in regulations issued by
the Executive Director.
"(4) A loan may not be made under this subsection to the extent
that the loan would be treated as a taxable distribution under
26 USC 72. section '72(p) of the Internal Revenue Code of 1954.
"(5) A loan may not be made under this subsection unless the
requirements of section 8435(0 of this title are satisfied.
5 USC 8434. "? 8434. Annuities: methods of payment; election; purchase
"(aX1) The Board shall prescribe methods of payment of annuities
under this subchapter.
"(2) The methods of payment prescribed under paragraph (1) shall
include, but not be limited to?
"(A) a method which provides for the payment of a monthly
annuity only to an annuitant during the life of the annuitant;
"(B) a method which provides for the payment of a monthly
annuity to an annuitant for the joint lives of the annuitant and
the spouse of the annuitant and an appropriate monthly annu-
ity to the one of them who survives the other of them for the life
of the survivor;
"(C) a method described in subparagraph (A) which provides
annual increases in the amount of the annuity payable;
"(D) a method described in subparagraph (B) which provides
annual increases in the amount of the annuity payable; and
"(E) a method which provides for the payment of a monthly
annuity?
"(i) to the annuitant for the joint lives of the annuitant
and an individual who is designated by the annuitant under
regulations prescribed by the Executive Director and (I) is a
former spouse of the annuitant, or (II) has an insurable
interest in the annuitant; and
"(ii) to the one of them who survives the other of them for
the life of the survivor.
Regulations. "(b) Subject to section 8435(c) of this title, under such regulations
as the Executive Director shall prescribe, an employee, Member,
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former employee, or former Member who elects under section 8433
of this title to receive an annuity under this subchapter shall elect,
on or before the date on which the annuity commences, one of the
methods of payment prescribed under subsection (a).
"(c) Notwithstanding an elimination of a method of payment by
the Board?
"(1) an employee, Member, former employee, or former
Member who is entitled under section 8412 of this title to an
immediate annuity not reduced under section 8415(0 of this title
may elect the eliminated method if the elimination of such
method became effective less than 5 years before the date on
which the annuity commences; and
"(2) any other employee, Member, former employee, or former
Member may elect such method of payment for amounts
contributed by or on behalf of the employee, Member, former
employee, or former Member under section 8432 of this title
before such effective date and for earnings attributable to such
amounts.
"(dX1) At the time an annuity is to commence under this sub-
chapter, the Executive Director shall expend the balance in the
annuitant's account to purchase an annuity contract from any
entity which, in the normal course of its business, sells and provides
annuities.
"(2) The Executive Director shall assure, by contract entered into Contracts.
with each entity from which an annuity contract is purchased under
paragraph (1), that the annuity shall be provided in accordance with
the provisions of this subchapter and subchapter VII of this chapter.
"(3) An annuity contract purchased under paragraph (1) shall
include such terms and conditions as the Executive Director re-
quires for the protection of the annuitant.
"(4) The Executive Director shall require, from each entity from
which an annuity contract is purchased under paragraph (1), a bond
or proof of financial responsibility sufficient to protect the
annuitant.
"? 8435. Protections for spouses and former spouses 5 USC 8435.
"(aX1XA) A married employee or Member (or former employee or
Member) may make an election under subsection (hX3), (hX4), (cX3),
or (cX4) of section 8433 of this title or change an election previously
made under subsection (b)(1), (bX2), (cX1), or (cX2) of such section
only if the employee or Member (or former employee or Member)
satisfies the requirements of subparagraph (B).
"(B) An employee or Member (or former employee or Member)
may make an election or change referred to in subparagraph (A) if
the employee or Member and the employee's or Member's spouse (or
the former employee or Member and the former employee's or
Member's spouse) jointly waive, by written election, any right which
the spouse may have to a survivor annuity with respect to such
employee or Member (or former employee or Member) under section
8434 of this title or subsection (c).
"(2) Paragraph (1) shall not apply to an election or change of
election by an employee or Member (or former employee or Member)
who establishes to the satisfaction of the Executive Director (at the
time of the election or change and in accordance with regulations
prescribed by the Executive Director)?
"(A) that the spouse's whereabouts cannot be determined; or
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1
"(B) that, due to exceptional circumstances, requiring the
spouse's waiver would otherwise be inappropriate.
"(bX1) Except as provided in paragraph (2), a transfer may be
made by an employee or Member (or former employee or Member) I
under section 8433(d) of this title only after the Executive Director
notifies any current spouse and each former spouse of the employee
or Member (or former employee or Member), if any, that the trans-
former spouse if the employee or Member (or former employee or
"(2) Paragraph (1) may be waived with respect to a spouse or
trans-
fer is to be made.
Member) establishes to the satisfaction of the Executive Director
that the whereabouts of such spouse or former spouse cannot be
determined.
"(cX1) Notwithstanding any election under subsection (b) of sec-
tion 8434 of this title, the method described in subsection (aX2XB) of
such section (or, if more than one form of such method is available,
the form which the Board determines to be the one which provides
for a surviving spouse a survivor annuity most closely approximat-
ing the annuity of a surviving spouse under section 8442 of this title)
shall be deemed the applicable method under such subsection (b) in
the case of an employee, Member, former employee, or former
Member who is married on the date on which the employee's,
Member's, former employee's, or former Member's annuity corn-
mences under this subchapter.
"(2) Paragraph (1) shall not apply?
"(A) in the case of an employee or Member retiring under
section 8412, 8413, 8414, or 8451 of this title if?
"(i) a joint waiver of such method is made, in writing, by
the employee or Member and the spouse; or
"(ii) the employee or Member waives such method, in
writing, after establishing to the satisfaction of the Execu-
tive Director that circumstances described in subsection
(aX2XA) or (aX2XB) make the requirement of a joint waiver
inappropriate; or
"(B) in the case of an employee or Member not covered by
subparagraph (A), if the employee or Member waives such
method after?
"(i) having provided notification to the spouse of intent to
waive; or
"(ii) establishing to the satisfaction of the Executive
Director that the whereabouts of such spouse cannot be
determined.
"(dX1) An election, change of election, or modification of the
commencement date of a deferred annuity shall not be effective
under this subchapter and a transfer may not be made under section
8433(d) of this title to the extent that the election, change, modifica-
tion, or transfer conflicts with any court decree, order, or agreement
described in paragraph (2).
"(2) A court decree, order, or agreement referred to in paragraph
(1) is, with respect to an employee or Member (or former employee
or Member), a court decree of divorce, annulment, or legal separa-
tion issued in the case of such employee or Member (or former
employee or Member) and any former spouse of the employee or
Member (or former employee or Member) or any court order or
court-approved property settlement agreement incident to such
decree if?
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"(A) the decree, order, or agreement expressly relates to any
portion of the balance in the employee's or Member's (or former
employee's or Member's) account; and
"(B) notice of the decree, order, or agreement was received by
the Executive Director before?
"(i) the date on which payment is made, or
"(ii) in the case of an annuity, the date on which the
annuity commences,
in accordance with the election, change, modification, or con-
tribution referred to in paragraph (1).
"(3) The Executive Director shall prescribe regulations under Regulations.
which this subsection shall be applied in any case in which the
Executive Director receives two or more decrees, orders, or agree-
ments referred to in paragraph (1).
"(eX1) Subject to paragraphs (2) through (7), a former spouse of a
deceased employee or Member (or a deceased former employee or
Member) who died after performing 18 or more months of service
and a former spouse of a deceased former employee or Member who
died entitled to an immediate or deferred annuity under subchapter
II of this chapter is entitled to a survivor annuity under this
subsection if and to the extent that?
"(A) an election under section 8434(aX2XE) of this title, or
"(B) any court decree, order, or agreement (described in
subsection (dX2), without regard to subparagraph (B) of such
subsection) which relates to such deceased individual and such
former spouse,
expressly provides for such survivor annuity.
"(2) Paragraph (1) shall apply only to payments made by the
Executive Director after the date on which the Executive Director
receives written notice of the election, decree, order, or agreement,
and such additional information and documentation as the Execu-
tive Director may require.
"(3) The amount of the survivor annuity payable from the Thrift
Savings Fund to a former spouse of a deceased employee, Member,
former employee, or former Member under this section may not
exceed the excess, if any, of?
"(A) the amount of the survivor annuity determined for a
surviving spouse of the deceased employee, Member, former
employee, or former Member under the method described in
subsection (cX1), over
"(B) the total amount of all other survivor annuities payable
under this subchapter to other former spouses of such deceased
employee, Member, former employee, or former Member based
on the order of precedence provided in paragraph (4).
"(4) If more than one former spouse of a deceased employee,
Member, former employee, or former Member is entitled to a survi-
vor annuity pursuant to this subsection, the amount of each such
survivor annuity shall be limited appropriately to carry out para-
graph (3) in the order of precedence established for the entitlements
by the chronological order of the dates on which elections are
properly made pursuant to section 8434(aX2XE) of this title and the
dates on which the court decrees, orders, or agreements applicable
to the entitlement were issued, as the case may be.
"(5) Subsections (c) and (d) of section 8445 of this title shall apply
to an entitlement of a former spouse to a survivor annuity under
this subsection.
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ivy i11-x. JOU 1- u DLIC LAW 99-335?JUNE 6, 1986
Loans.
5 USC 8436.
5 USC 8437.
"(6) For the purposes of this section, a court decree, order, or
agreement or an election referred to in subsection (a) of this section
shall not be effective, in the case of a former spouse, to the extent
that the election is inconsistent with any joint waiver previously
executed with respect to such former spouse under subsection (aX2)
or (cX2).
"(7) Any payment under this subsection to any individual bars
recovery by any other individual.
"(f)(1XA) A loan may be made to a married employee or Member
under section 8433(i) of this title only if the employee's or Member's
spouse consents to such loan in writing.
"(B) A consent under subparagraph (A) shall be irrevocable with
respect to the loan to which the consent relates.
"(C) Subparagraph (A) shall not apply to a loan to an employee or
Member who establishes to the satisfaction of the Executive Direc-
tor (at the time the employee or Member applies for such loan and
in accordance with regulations prescribed by the Executive
Director)?
"(i) that the spouse's whereabouts cannot be determined; or
"(ii) that, due to exceptional circumstances, requiring the
employee or Member to seek the spouse's consent would other-
wise be inappropriate.
"(2) An application for a loan under section 8433(i) of this title
shall not be approved if approval would have the result described in
subsection (d)(1).
"(g) Waivers and notifications required by this section and waivers
of the requirements for such waivers and notifications (as
authorized by this section) may be made only in accordance with
procedures prescribed by the Executive Director.
"(h) The protections provided by this section are in addition to the
protections provided by section 8467 of this title.
"? 8436. Administrative provisions
"(a) The Executive Director shall make or provide for payments
and transfers in accordance with an election of an employee or
Member under section 8433 or 8434(b) of this title or, if applicable, in
accordance with section 8435 of this title.
"(b) Any election, change of election, or modification of a deferred
annuity commencement date made under this subchapter shall be in
writing and shall be filed with the Executive Director in accordance
with regulations prescribed by the Executive Director.
"? 8437. Thrift Savings Fund
"(a) There is established in the Treasury of the United States a
Thrift Savings Fund.
"(b) The Thrift Savings Fund consists of the sum of all amounts
contributed under section 8432 of this title and all amounts depos-
ited under section 8479(b) of this title, increased by the total net
earnings from investments of sums in the Thrift Savings Fund or
reduced by the total net losses from investments of the Thrift
Savings Fund, and reduced by the total amount of payments made
from the Thrift Savings Fund (including payments for administra-
tive expenses).
"(c) The sums in the Thrift Savings Fund are appropriated and
shall remain available without fiscal year limitation?
"(1) to invest under section 8438 of this title;
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"(2) to pay benefits or purchase annuity contracts under this
subchapter;
"(3) to pay the administrative expenses of the Federal Retire-
ment Thrift Investment Management System prescribed in
subchapter VII of this chapter;
"(4) to make distributions for the purposes of section 8440(b)
of this title;
"(5) to make loans to employees and Members as authorized
under section 8433(i) of this title; and
"(6) to purchase insurance as provided in section 8479(bX2) of
this title.
"(d) Administrative expenses incurred to carry out this sub-
chapter and subchapter VII of this chapter shall be paid first out of
any sums in the Thrift Savings Fund forfeited under section 8432(g)
of this title and then out of net earnings in such Fund attributable
to sums contributed to such Fund under section 8432(c) of this title.
"(e)(1) Subject to paragraphs (2) and (3), sums in the Thrift Savings
Fund credited to the account of an employee, Member, former
employee, or former Member may not be used for, or diverted to,
purposes other than for the exclusive benefit of the employee,
Member, former employee, or former Member or his beneficiaries
under this subchapter.
"(2) Except as provided in paragraph (3), sums in the Thrift
Savings Fund may not be assigned or alienated and are not subject
to execution, levy, attachment, garnishment, or other legal process.
For the purposes of this paragraph, a loan made from such Fund to
an employee or Member shall not be considered to be an assignment
or alienation.
"(3) Moneys due or payable from the Thrift Savings Fund to any
individual and, in the case of an individual who is an employee or
Member (or former employee or Member), the balance in the ac-
count of the employee or Member (or former employee or Member)
shall be subject to legal process for the enforcement of the individ-
ual's legal obligations to provide child support or make alimony
payments as provided in section 459 of the Social Security Act (42
U.S.C. 659).
"U') The sums in the Thrift Savings Fund shall not be appropriated
for any purpose other than the purposes specified in this section and
may not be used for any other purpose.
"(g) All sums contributed to the Thrift Savings Fund by an
employee or Member or by an employing agency for the benefit of
such employee or Member and all net earnings in such Fund
attributable to investment of such sums are held in such Fund in
trust for such employee or Member.
"? 8438. Investment of Thrift Savings Fund
"(a) For the purposes of this section?
"(1) the term 'Common Stock Index Investment Fund' means
the Common Stock Index Investment Fund established under
subsection (bX1)(C);
"(2) the term 'equity capital' means common and preferred
stock, surplus, undivided profits, contingency reserves, and
other capital reserves;
"(3) the term 'Fixed Income Investment Fund' means the
Fixed Income Investment Fund established under subsection
(b)(1)(B);
Child support.
Alimony.
Law
enforcement
and crime.
5 USC 8438.
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_
"(4) the term 'Government Securities Investment Fund'
means the Government Securities Investment Fund established
under subsection (bX1XA);
"(5) the term 'net worth' means capital, paid-in and contrib-
uted surplus, unassigned surplus, contingency reserves, group
contingency reserves, and special reserves;
"(6) the term 'plan' means an employee benefit plan, as
defined in section 3(3) of the Employee Retirement Income
Security Act of 1974 (29 U.S.C. 1002(3));
"(7) the term 'qualified professional asset manager' means?
"(A) a bank, as defined in section 202(aX2) of the
Investment Advisers Act of 1940 (15 U.S.C. 80b-2(aX2))
which?
"(i) has the power to manage, acquire, or dispose of
assets of a plan; and
"(ii) has, as of the last day of its latest fiscal year
ending before the date of a determination for the pur-
pose of this clause, equity capital in excess of
$1,000,000;
"(B) a savings and loan association, the accounts of which
are insured by the Federal Savings and Loan Insurance
Corporation, which?
"(i) has applied for and been granted trust powers to
manage, acquire, or dispose of assets of a plan by a
State or Government authority having supervision over
savings and loan associations; and
"(ii) has, as of the last day of its latest fiscal year
ending before the date of a determination for the pur-
pose of this clause, equity capital or net worth in excess
of $1,000,000;
"(C) an insurance company which?
"(i) is qualified under the laws of more than one
State to manage, acquire, or dispose of any assets of a
plan;
"(ii) has, as of the last day of its latest fiscal year
ending before the date of a determination for the pur-
pose of this clause, net worth in excess of $1,000,000;
and
"(iii) is subject to supervision and examination by a
State authority having supervision over insurance
companies; or
"(D) an investment adviser registered under section 203
of the Investment Advisers Act of 1940 (15 U.S.C. 80b-3) if
the investment adviser has, on the last day of its latest
fiscal year ending before the date of a determination for the
purpose of this subparagraph, total client assets under its
management and control in excess of $50,000,000, and?
"(i) the investment adviser has, on such day, share-
holder's or partner's equity in excess of $750,000; or
"(ii) payment of all of the investment adviser's liabil-
ities, including any liabilities which may arise by
reason of a breach or violation of a duty described in
section 8477 of this title, is unconditionally guaranteed
by?
"(I) a person (as defined in section 8471(4) of this
title) who directly or indirectly, through one or
more intermediaries, controls, is controlled by, or
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is under common control with the investment ad-
viser and who has, on the last day of the person's
latest fiscal year ending before the date of a deter-
mination for the purpose of this clause, share-
holder's or partner's equity in an amount which,
when added to the amount of the shareholder's or
partner's equity of the investment adviser on such
day, exceeds $750,000;
"(II) a qualified professional asset manager de-
scribed in subparagraph (A), (B), or (C); or
"(III) a broker or dealer registered under section
15 of the Securities Exchange Act of 1934 (15 U.S.C.
78o) that has, on the last day of the broker's or 15 USC 780.
dealer's latest fiscal year ending before the date of
a determination for the purpose of this clause, net
worth in excess of $750,000; and
"(8) the term 'shareholder's or partner's equity', as used in
paragraph (7XD) with respect to an investment adviser or a
person (as defined in section 8471(4) of this title) who is affili-
ated with the investment adviser in a manner described in
clause (iiXI) of such paragraph (7XD), means the equity shown in
the most recent balance sheet prepared for such investment
adviser or affiliated person, in accordance with generally
accepted accounting principles, within 2 years before the date
on which the investment adviser's status as a qualified profes-
sional asset manager is determined for the purposes of this
section.
"(b)(1) The Board shall establish?
"(A) a Government Securities Investment Fund under which
sums in the Thrift Savings Fund are invested in securities of the
United States Government issued as provided in subsection (f);
"(B) a Fixed Income Investment Fund under which sums in
the Thrift Savings Fund are invested in?
"(i) insurance contracts;
"(ii) certificates of deposits; or
"(iii) other instruments or obligations selected by quali-
fied professional asset managers,
which return the amount invested and pay interest, at a speci-
fied rate or rates, on that amount during a specified period of
time; and
"(C) a Common Stock Index Investment Fund as provided in
paragraph (2).
"(2XA) The Board shall select an index which is a commonly
recognized index comprised of common stock the aggregate market
value of which is a reasonably complete representation of the
United States equity markets.
"(B) The Common Stock Index Investment Fund shall be invested
in a portfolio designed to replicate the performance of the index
selected under subparagraph (A). The portfolio shall be designed
such that, to the extent practicable, the percentage of the Common
Stock Index Investment Fund that is invested in each stock is the
same as the percentage determined by dividing the aggregate
market value of all shares of that stock by the aggregate market
value of all shares of all stocks included in such index.
"(cX1) Subject to subsection (e), the Executive Director shall invest
the sums available in the Thrift Savings Fund for investment as
provided in elections made under subsection (d).
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"(2) If an election has not been made with respect to any sums in
the Thrift Savings Fund available for investment, the Executive
Director shall invest such sums in the Government Securities
Investment Fund.
"(dX1) At least twice each year, an employee or Member (or
former employee or Member) may elect the investment funds re-
ferred to in subsection (b) into which the sums in the Thrift Savings
Fund credited to such individual's account and not subject to subsec-
tion (e) are to be invested or reinvested.
"(2) An election may be made under paragraph (1) only in accord-
ance with regulations prescribed by the Executive Director and
within such period as the Executive Director shall provide in such
regulations.
"(eX1XA) During each year specified under column 1 of table I set
out in subparagraph (D), the Executive Director shall invest, with
respect to each employee, Member, former employee, and former
Member not less than the percentage determined under subpara-
graph (B) of the amount described in subparagraph (C) in the
Government Securities Investment Fund.
"(B) For the purposes of subparagraph (A), the minimum percent-
age applicable to investments during a year specified under column
1 of table I is the percentage which corresponds to such year under
column 2 of table I.
"(C) The amount to be invested as provided in subparagraph (A) in
any year specified under column 1 of table I is the total amount
contributed to the Thrift Savings Fund by an employee, Member,
former employee, or former Member under section 8432(a) of this
title and available for investment during such year.
"(D) Table I is as follows:
"TABLE I
"Column 1 Column 2
Year: Minimum percentage:
1987
100
1988
80
1989
60
1990
40
1991
20.
"(2XA) During each year specified under column 1 of table II set
out in subparagraph (D), the Executive Director shall invest, with
respect to each employee, Member, former employee, and former
Member not less than the percentage determined under subpara-
graph (B) of the amount described in subparagraph (C) in the
Government Securities Investment Fund.
"(B) For the purposes of subparagraph (A), the minimum percent-
age applicable to investments during a year specified under column
1 of table II is the percentage which corresponds to such year under
column 2 of table II.
"(C) The amount to be invested as provided in subparagraph (A) in
any year specified under column 1 of table II is the total amount
contributed to the Thrift Savings Fund for the benefit of an em-
ployee, Member, former employee, or former Member under section
8432(c) of this title and available for investment during such year.
"(D) Table II is as follows:
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"? 8440. Tax treatment of the Thrift Savings Fund 5 USC 8440.
"(a) For purposes of the Internal Revenue Code of 1954? 26 USC 1 et seq.
"(1) the Thrift Savings Fund shall be treated as a trust
described in section 401(a) of such Code which is exempt from 26 USC 401.
taxation under section 501(a) of such Code; 26 USC 501.
"(2) any contribution to, or distribution from, the Thrift
Savings Fund shall be treated in the same manner as contribu-
tions to or distributions from such a trust; and
"(3) subject to the provisions of subsection (b) and any dollar
limitation on the application of section 402(aX8) of such Code, 26 USC 402.
contributions to the Thrift Savings Fund shall not be treated as
distributed or made available to an employee or Member nor as
a contribution made to the Fund by an employee or Member
merely because the employee or Member has, under the provi-
sions of this subchapter and section 8351 of this title, an election
whether the contribution will be made to the Thrift Savings
Fund or received by the employee or Member in cash.
"(bX1) Subsection (aX3) shall not apply to the Thrift Savings Fund
unless the Fund meets the antidiscrimination requirements (other
than any requirement relating to coverage) applicable to arrange-
ments described in section 401(k) of the Internal Revenue Code of
1954 and to matching contributions. 26 USC 401.
"(2 XA) This subchapter shall not be treated as failing to meet the
requirements of paragraph (1) for any year if the amount of the
excess matching contributions and excess employee contributions
for such year (and any income attributable to such contributions) is
distributed before the close of the following year. Such contributions
(and income) may be distributed without regard to any other provi-
sion of law.
"(B) For purposes of subparagraph (A), the term 'excess matching
contributions' means, with respect to any year, the excess of?
"(i) the aggregate amount of contributions under section
8432(c) of this title actually made on behalf of highly com-
pensated employees (as defined for purposes of section 401(k) of
the Internal Revenue Code of 1954) for such year, over
"(ii) the maximum amount of such contributions permitted
under the limitations of paragraph (1) (determined by reducing
contributions made on behalf of highly compensated employees
in order of the matching contribution percentages beginning
with the highest of such percentages).
"(C) For purposes of subparagraph (A), the amount of excess
employee contributions shall be determined under the principles of
subparagraph (B).
"(D) Any distribution of the excess matching contributions or
excess employee contributions for any year shall be made to highly
compensated employees on the basis of the respective portions of
such amounts attributable to each of such employees.
"(E) No early distribution tax, if any, under the Internal Revenue
Code of 1954 shall be imposed on any amount required to be 26 USC 1 et seq.
distributed under subparagraph (A).
"(c) Subsection (a) shall not be construed to provide that any
amount of the employee's or Member's basic pay which is contrib-
uted to the Thrift Savings Fund shall not be included in the term
'wages' for the purposes of section 209 of the Social Security Act or Ante, p. 288.
section 3121(a) of the Internal Revenue Code of 1954. 26 USC 3121.
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"SUBCHAPTER IV?SURVIVOR ANNUITIES
5 USC 8441. "? 8441. Definitions
"For the purpose of this subchapter?
"(1) the term 'widow' means the surviving wife of an em-
ployee, Member, or annuitant, or of a former employee or
Member, who?
"(A) was married to him for at least 9 months imme-
diately before his death; or
"(B) is the mother of issue by that marriage;
"(2) the term 'widower' means the surviving husband of an
employee, Member, or annuitant, or of a former employee or
Member, who?
"(A) was married to her for at least 9 months imme-
diately before her death; or
"(B) is the father of issue by that marriage;
"(3) the term 'dependent', in the case of any child, means that
the employee, Member, or annuitant involved was, at the time
of death of the employee, Member, or annuitant either living
with or contributing to the support of such child, as determined
in accordance with such regulations as the Office shall pre-
scribe; and
"(4) the term 'child' means?
"(A) an unmarried dependent child under 18 years of age,
including (i) an adopted child, (ii) a stepchild but only if the
stepchild lived with the employee, Member, or annuitant in
a regular parent-child relationship, (iii) a recognized natu-
ral child, and (iv) a child who lived with and for whom a
petition of adoption was filed by an employee, Member, or
annuitant and who is adopted by the widow or widower of
the employee, Member, or annuitant after the death of such
employee, Member, or annuitant;
"(B) such unmarried dependent child regardless of age
who is incapable of self-support because of mental or phys-
ical disability incurred before age 18; or
"(C) such unmarried dependent child between 18 and 22
years of age who is a student regularly pursuing a full-time
course of study or training in residence in a high school,
trade school, technical or vocational institute, junior col-
lege, college, university, or comparable recognized edu-
cational institution.
For the purpose of this paragraph and section 8443, a child
whose 22nd birthday occurs before July 1 or after August 31 of a
calendar year, and while regularly pursuing such a course of
study or training, is deemed to have become 22 years of age on
the first day of July after that birthday. A child who is a
student is deemed not to have ceased to be a student during an
interim between school years if the interim is not more than 5
months and if such child shows to the satisfaction of the Office
that such child has a bona fide intention of continuing to pursue
a course of study or training in the same or different school
during the school semester (or other period into which the
school year is divided) immediately after the interim.
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"? 8442. Rights of a widow or widower 5 USC 8442.
"(aX1) Except as provided in subsection (g), if an annuitant dies
and is survived by a widow or widower, the widow or widower is
entitled to an annuity equal to 50 percent of an annuity computed
under section 8415 with respect to the annuitant, unless?
"(A) the right to an annuity was waived under section 8416(a)
(and no election was subsequently made under section 8416(d)
nullifying the waiver); or
"(B) in the case of a marriage after retirement, the annuitant
did not file an election under section 8416 (b) or (c), as the case
may be.
"(2) A spouse acquired after retirement is entitled to an annuity
under this subsection (as provided in paragraph (1)) only upon
electing this annuity instead of any other survivor benefit to which
such spouse may be entitled under this subchapter or section 8424 or
under another retirement system for Government employees.
"(bX1) If an employee or Member dies after completing at least 18
months of civilian service creditable under section 8411 and is
survived by a widow or widower, the widow or widower is entitled
to?
"(A) an amount equal to the sum of?
"(i) 50 percent of the final annual rate of basic pay (or of
the average pay, if higher) of the employee or Member; and
"(ii) $15,000 as adjusted under section 8462(e); and
"(B) if the employee or Member completed at least 10 years of
service, an annuity equal to 50 percent of an annuity computed
under section 8415 with respect to the employee or Member, but
without regard to subsection (f) of such section.
"(2) The Office shall prescribe regulations under which the total Regulations.
amount payable to a widow or widower under paragraph (1XA) may,
at the election of the widow or widower, be paid?
"(A) in a lump sum; or
"(B) on a monthly basis?
"(i) over a period of 3 years beginning on the day after the
employee's or Member's death; or
"(ii) over any other period established under the
regulations.
Any method of payment provided for under subparagraph (B) shall
be designed such that the present value of the benefits provided
under such method is actuarially equivalent to the present value of
a lump-sum payment under subparagraph (A).
"(3) An amount payable under paragraph (1XA) shall not be
considered to be part of an annuity for purposes of this chapter.
"(cX1) If a former employee or Member dies after having sepa-
rated from the service with title to a deferred annuity under section
8413 but before having established a valid claim for an annuity, and
is survived by a widow or widower to whom married on the date of
separation, the widow or widower may elect to receive?
"(A) an annuity under paragraph (2); or
"(B) the lump-sum credit, if the widow or widower is the
individual who would be entitled to the lump-sum credit and if
such widow or widower files application therefor with the
Office.
"(2XA)(i). Subject to clause (ii) and subparagraph (BXii), the annu-
ity of the widow or widower is equal to 50 percent of an annuity
computed under section 8415 for the former employee or Member.
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"(iiXI) In computing an amount under section 8415 for a former
employee or Member (described in subclause (II)) in order to com-
pute the annuity for a widow or widower under this subsection, the
computation under section 8415 shall be made as if the former
employee or Member had attained the applicable minimum retire-
ment age under section 8412(h).
"(II) This clause applies with respect to a former employee or
Member who dies before having attained the applicable minimum
retirement age under section 8412(h).
"(BXi) Notwithstanding the first sentence of subsection (dX1), the
annuity of the widow or widower of a former employee or Member
under subparagraph (AXii) commences?
"(I) on the day after the date on which the former employee or
Member would have attained age 62; or
"(II) if the widow or widower so designates in the election, as
of the day after the death of the former employee or Member.
"(ii) The present value of the annuity of a widow or widower who
chooses the earlier commencement date under clause (iXII) shall be
actuarially equivalent to the present value of an annuity computed
for the widow or widower, determined as if the commencement date
under clause (iXI) were applicable.
"(3XA) Paragraphs (1) and (2) shall apply only in the case of an
employee or Member who completes at least 10 years of service.
"(B) Nothing in this subsection shall be considered to affect the
provisions of this chapter relating to a lump-sum credit in the case
of the widow or widower of a former employee or Member who dies
after completing less than 10 years of service.
"(dX1) The annuity of a widow or widower under this section
commences on the day after the death of the individual on whose
service such annuity is based. This annuity and the right thereto
terminate on the last day of the month before the widow or
widower?
"(A) dies; or
"(B) remarries before becoming 55 years of age.
"(2) In the case of a widow or widower whose annuity under this
section is terminated because of remarriage before becoming 55
years of age, the annuity shall be restored at the same rate
commencing on the day the remarriage is dissolved by death, di-
vorce, or annulment, if?
"(A) the widow or widower elects to receive this annuity
instead of any other survivor benefit to which such widow or
widower may be entitled (under this subchapter or section 8424
or under another retirement system for Government employees)
by reason of the remarriage; and
"(B) any lump sum paid on termination of the annuity is
returned to the Fund.
"(e) The requirement in paragraphs (1XA) and (2XA) of section
8441 that the widow or widower of an annuitant, employee, or
Member, or of a former employee or Member, have been married to
such individual for at least 9 months immediately before the death
of the individual in order to qualify as the widow or widower of such
individual shall be deemed satisfied in any case in which the
individual dies within the applicable 9-month period, if?
"(1) the death of the individual was accidental; or
"(2) the surviving spouse of the individual had been pre-
viously married to such individual and subsequently divorced,
and the aggregate time married is at least 9 months.
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"(0(1) Subject to paragraph (4), a survivor who is entitled to an
annuity under subsection (a) shall also be entitled to a supple-
mentary annuity under this subsection.
"(2) A supplementary annuity under this subsection shall be equal
to the lesser of?
"(A) the amount by which the survivor's assumed CSRS
annuity exceeds the annuity payable to such survivor under
subsection (a); or
"(B) the amount determined under paragraph (3).
"(3XA) Except as provided in subparagraph (B), the amount under
this paragraph for a survivor is the amount of widow's or widower's
insurance benefits which would be payable to such survivor under
title II of the Social Security Act (without regard to sections 42 USC 401.
202(eX7), 202(0(2), and 203 of such Act) based on the wages and self- 42 USC 402, 403.
employment income of the deceased annuitant, and determined?
"(i) as of the date on which the annuitant died; and
"(ii) as if the survivor had attained age 60 and made applica-
tion for those benefits under subsection (e) or (f) of section 202 of
such Act, as the case may be.
"(B) Any computation or determination under this paragraph
shall be made in accordance with the applicable provisions of the
Social Security Act, except that in computing any primary insur- 42 USC 1305.
ance amount under section 215 of such Act for purposes of determin- 42 USC 415.
ing an amount under this subsection, subparagraphs (A) and (C) of
section 8421(13)(2) shall apply.
"(4) A supplementary annuity under this subsection?
"(A) shall be payable to a survivor only for calendar months
ending before the calendar month in which such survivor first
satisfies the minimum age requirement under section
202(eX1)(B)(D or 202(f)(1XBXi) of the Social Security Act, as the 42 USC 402.
case may be;
"(B) shall not be payable to a survivor who would not be
entitled to benefits under subsection (e) or (f) of section 202 of
the Social Security Act based on the wages and self-employment
income of the deceased annuitant (determined, as of the date of
the annuitant's death, as if the survivor had attained age 60 and
made appropriate application for benefits, but without regard to
any restriction under either such subsection relating to re-
marriage); and
"(C) shall not be payable to a survivor for any calendar month
in which such survivor is entitled (or would, on proper applica-
tion, be entitled) to benefits under section 202(g) of the Social
Security Act (relating to mother's and father's insurance bene-
fits), or under section 202 (e) or (0 of such Act by reason of
having become disabled, based on the wages and self-
employment income of the deceased annuitant.
"(5) For the purpose of this subsection, the term 'assumed CSRS
annuity', as used in the case of a survivor, means the amount of the
annuity to which such survivor would be entitled under subchapter
III of chapter 83 of this title based on the service of the deceased Post, pp. 589,
annuitant, determined? 591-593.
"(A) as of the day after the date of the annuitant's death;
"(B) as if the survivor had made appropriate application
therefor; and
"(C) as if the service of the deceased annuitant were cred-
itable under such subchapter.
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"(6) An amount payable under this subsection shall be adjusted
under section 8462 and shall otherwise be treated under this chapter
in the same way as an amount payable under subsection (a).
"(gX1) If the widow or widower of an annuitant under section 8452
(hereinafter in this subsection referred to as a 'disability annuitant')
is determined under subsection (a) to be entitled to an annuity based
on the service of such disability annuitant, the annuity of the widow
or widower shall be equal to 50 percent of the amount determined
under paragraph (2), rather than of the amount referred to in
subsection (a).
"(2XA) Except as provided in subparagraph (B), the amount on
which the annuity of the widow or widower of a disability annuitant
is based shall be the amount of the annuity to which such disability
annuitant was entitled, as computed under section 8452 (including
appropriate reduction under subsection (aX2) of such section and
any adjustments under section 8462 allowed under section 8452), as
of the day before the date of the disability annuitant's death.
"(EXi) In the case of a widow or widower entitled to an annuity
based on the service of a disability annuitant who dies before age 62,
the amount under clause (ii) shall apply instead of the amount
which would otherwise apply under subparagraph (A).
"(iiXI) Subject to subclause (II), the amount of the annuity to
which the disability annuitant was entitled as of the day before the
date of death shall be considered to be the amount which would be
computed with respect to such disability annuitant under section
8452(b) if the disability annuitant had attained age 62 on the day
before date of death.
"(II) For purposes of any such computation under section
8452(bX2) pursuant to this clause, creditable service shall (in addi-
tion to the service which would otherwise be used under subpara-
graph (EXi) of such section) include the period of time between date
of death and the date of the sixty-second anniversary of the birth of
the annuitant, and average pay shall be adjusted in accordance with
subparagraph (EXii) of such section only through date of death.
"(h) The following rules shall apply notwithstanding any other
provision of this section:
"(1) The annuity payable under this section to a widow or
widower may not exceed the difference between?
"(A) the amolmt, of the annuity which would otherwise be
payable to such widow or widower under this section; and
"(B) the amount of the annuity payable to any former
spouse of the deceased employee, Member, or annuitant, or
former employee or Member, based on an election made
under section 8417(b) or a court order previously issued or
agreement previously entered into as described in section
8445(a).
"(2) The amount payable under subsection (bX1XA) to a widow
or widower may not exceed the difference between?
"(A) the amount which would otherwise be payable to
such widow or widower under such subsection; and
"(E) the portion of such amount payable to any former
spouse of the deceased employee, Member, or annuitant, or
former employee or Member, based on a court order pre-
viously issued or agreement previously entered into.
"(3) A lump-sum credit under subsection (cX2) shall be subject
to the same terms and conditions as apply with respect to a
lump-sum credit under section 8424(b).
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"? 8443. Rights of a child 5 USC 8443.
"(aX1) If an employee or Member dies after completing at least 18
months of civilian service which is creditable under section 8411, or
an annuitant dies, each surviving child is, for any month, entitled. to
an annuity equal to?
"(A) the amount by which the applicable amount under para-
graph (2) for such month exceeds the applicable amount under
paragraph (3) for such month, divided by
"(B) the number of children entitled to a payment under this
section for such month.
"(2) The applicable amount under this paragraph for any month is
the total amount to which the surviving child or children (as the
case may be) of the annuitant, employee, or Member would be
entitled for such month under subchapter III of chapter 83 based on Post, pp. 589,
the service of such annuitant, employee, or Member, if the service of 591-593.
such annuitant, employee, or Member were creditable under such
subchapter.
"(3) The applicable amount under this paragraph for any month is
the total amount of child's insurance benefits which are payable (or
would, on proper application, be payable) under title II of the Social
Security Act for such month based on the wages and self-employ- 42 USC 401.
ment income of such annuitant, employee, or Member.
"(b) The annuity of a child under this subchapter?
"(1) commences on the day after the annuitant, employee, or
Member dies;
"(2) commences or resumes on the first day of the month in
which the child later becomes or again becomes a student as
described by section 8441(4), if any lump sum paid is returned to
the Fund; or
"(3) commences or resumes on the first day of the month in
which the child later becomes or again becomes incapable of
self-support because of a mental or physical disability incurred
before age 18 (or a later recurrence of such disability), if any
lump sum paid is returned to the Fund.
This annuity and the right thereto terminate on the last day of the
month before the child?
"(A) becomes 18 years of age unless then a student as de-
scribed or incapable of self-support;
"(B) becomes capable of self-support after becoming 18 years
of age unless then such a student;
"(C) becomes 22 years of age if then such a student and
capable of self-support;
"(D) ceases to be such a student after becoming 18 years of age
unless then incapable of self-support; or
"(E) dies or marries;
whichever occurs first. On the death of the surviving wife or hus-
band, or former wife or husband, or termination of the annuity of a
child, the annuity of any other child or children shall be recomputed
and paid as though the wife or husband, former wife or husband, or
child had not survived the annuitant, employee, or Member.
"? 8444. Rights of a named individual with an insurable interest
"The annuity of a survivor named under section 8420(a) is 55
percent of the reduced annuity of the retired employee or Member
determined under paragraph (2) of such section 8420(a). The annuity
of the survivor commences on the day after the retired employee or
5 USC 8444.
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5 USC 8445.
Contracts.
Member dies. This annuity and the right thereto terminate on the
last day of the month before the survivor dies.
"? 8445. Rights of a former spouse
."(a) Subject to subsections (b) through (e), a former spouse of a
deceased employee, Member, or annuitant (or of a former employee
or Member who dies after having separated from the service with
title to a deferred annuity under section 8413 but before having
established a valid claim for annuity) is entitled to an annuity under
this section, if and to the extent expressly provided for in an election
under section 8417(b), or in the terms of any decree of divorce or
annulment or any court order or court-approved property settle-
ment agreement incident to such decree.
"(bX1) The annuity payable to a former spouse under this section
may not exceed the difference between?
"(A) the amount applicable in the case of such former spouse,
as determined under paragraph (2); and
"(B) the amount of any annuity payable under this section to
any other former spouse of the employee, Member, or annu-
itant, or former employee or Member, based on an election
previously made under section 8417(b), or a court order pre-
viously issued or agreement previously entered into as described
in subsection (a).
"(2) The applicable amount, for purposes of paragraph (1XA) in the
case of a former spouse, is the amount of the annuity which would
be payable under the provisions of section 8442 (including subsection
(0 of such section, but without regard to subsection (h) of such
section) if such former spouse were a widow or widower entitled to
an annuity under such provisions based on the service of the
deceased employee, Member, or annuitant, or former employee or
Member.
"(c) The commencement and termination of an annuity payable
under this section shall be governed by the terms of the applicable
order, decree, agreement, or election, as the case may be, except that
any such annuity?
"(1) shall not commence before?
"(A) the day after the employee, Member, or annuitant,
or former employee or Member, dies; or
"(B) the first day of the second month beginning after the
date on which the Office receives written notice of the
order, decree, agreement, or election, as the case may be,
together with such additional information or documenta-
tion as the Office may prescribe;
whichever is later; and
"(2) shall terminate no later than the last day of the month
before the former spouse remarries before becoming 55 years of
age or dies.
"(d) For purposes of this chapter, a modification in a decree, order,
agreement, or election referred to in subsection (a) shall not be
effective?
"(1) if such modification is made after the retirement or death
of the employee, Member, or annuitant, or former employee or
Member, concerned; and
"(2) to the extent that such modification involves an annuity
under this section.
"(e) For purposes of this chapter, a decree, order, agreement, or
election referred to in subsection (a) shall not be effective, in the
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0-d AL' 0, 1000 100 STAT. 555
"TABLE II
"Column 1 Column 2
Year: Minimum percentage:
1987-1992 100
1993 80
1994 60
1995 40
1996 20.
"(3XA) Before 1992, the sums invested in the Government Securi-
ties Investment Fund as required by paragraph (1) and the earnings
attributable to the investment of such sums may not be reinvested
in any investment fund other than the Government Securities
Investment Fund.
"(B) Before 1997, the sums invested in the Government Securities
Investment Fund as required by paragraph (2) and the earnings
attributable to the investment of such sums may not be reinvested
in any investment fund other than the Government Securities
Investment Fund.
"(f)(1) The Secretary of the Treasury is authorized to issue special
interest-bearing obligations of the United States for purchase by the
Thrift Savings Fund for the Government Securities Investment
Fund.
"(2XA) Obligations issued for the purpose of this subsection shall
have maturities fixed with due regard to the needs of such Fund as
determined by the Executive Director, and shall bear interest at a
rate equal to the average market yield (computed by the Secretary
of the Treasury on the basis of market quotations as of the end of
the calendar month next preceding the date of issue of such obliga-
tions) on all marketable interest-bearing obligations of the United
States then forming a part of the public debt which are not due or
callable earlier than 4 years after the end of such calendar month.
"(B) Any average market yield computed under subparagraph (A)
which is not a multiple of one-eighth of 1 percent, shall be rounded
to the nearest multiple of one-eighth of 1 percent.
"(g) The Board, other Government agencies, the Executive Direc-
tor, an employee, a Member, a former employee, and a former
Member may not exercise voting rights associated with the owner-
ship of securities by the Thrift Savings Fund.
"? 8439. Accounting and information
"(a)(1) The Executive Director shall establish and maintain an
account for each individual for whom contributions are made under
section 8432(cX1) of this title or who makes contributions to the
Thrift Savings Fund under section 8351 of this title.
"(2) The balance in an individual's account at any time is the
excess of?
"(A) the sum of?
"(i) all contributions made to the Thrift Savings Fund by
the individual under section 8432(a) or 8351 of this title;
"(ii) all contributions made to such Fund for the benefit of
the individual under section 8432(c) of this title; and
"(iii) the total amount of the allocations made to and
reductions made in the account pursuant to paragraph (3),
over
"(B) the amounts paid out of the Thrift Savings Fund with
respect to such individual under this subchapter.
"(3) Pursuant to regulations prescribed by the Executive Director,
the Executive Director shall allocate to each account an amount
equal to a pro rata share of the net earnings and net losses from
each investment of sums in the Thrift Savings Fund attributable to
sums credited to such account, reduced by an appropriate share of
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Audit.
Report.
Regulations.
the administrative expenses paid out of the net earnings under
section 8437(d) of this title, as determined by the Executive Director.
"(bX1) For the purposes of this subsection, the term 'qualified
public accountant shall have the same meaning as provided in
section 103(aX3XD) of the Employee Retirement Income Security Act
of 1974 (29 U.S.C. 1023(aX3XD)).
"(2) The Executive Director shall annually engage, on behalf of all
individuals for whom an account is maintained, an independent
qualified public accountant, who shall conduct an examination of all
accounts and other books and records maintained in the administra-
tion of this subchapter and subchapter VII as the public accountant
considers necessary to enable the public accountant to make the
determination required by paragraph (3). The examination shall be
conducted in accordance with generally accepted auditing standards
and shall involve such tests of the accounts, books, and records as
the public accountant considers necessary.
"(3) The public accountant conducting an examination under
paragraph (2) shall determine whether the accounts, books, and
records referred to in such paragraph have been maintained in
conformity with generally accepted accounting principles applied on
a basis consistent with the manner in which such principles were
applied during the examination conducted under such paragraph
during the preceding year. The public accountant shall transmit to
the Board and the Comptroller General of the United States a
report on his examination, including his determination under this
paragraph.
"(4) In making a determination under paragraph (3), a public
accountant may rely on the correctness of any actuarial matter
certified by an enrolled actuary if the public accountant states his
reliance in the report transmitted to the Board under such
paragraph.
"(cX1) The Board shall prescribe regulations under which each
individual for whom an account is maintained shall be furnished
with?
"(A) a periodic statement relating to the individual's account;
and
"(B) a summary description of the investment options under
section 8438 of this title covering, and an evaluation of, each
such option the 5-year period preceding the date as of which
such evaluation is made.
"(2) Information under this subsection shall be provided at least
30 calendar days before the beginning of each election period under
section 8432(bX1XA) of this title, and in a manner designed to
facilitate informed decisionmaking with respect to elections under
sections 8432 and 8438 of this title.
"(d) Each employee, Member, former employee, or former Member
who elects to invest in the Common Stock Index Investment Fund or
the Fixed Income Investment Fund described in paragraphs (1) and
(3), respectively, of section 8438(a) of this title shall sign an acknowl-
edgement prescribed by the Executive Director which states that the
employee, Member, former employee, or former Member under-
stands that an investment in either such Fund is made at the
employee's, Member's, former employee's, or former Member's risk,
that the employee, Member, former employee, or former Member is
not protected by the Government against any loss on such invest-
ment, and that a return on such investment is not guaranteed by
the Government.
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v. au-000?JUNE 6, 1986 100 STAT. 565
case of a former spouse, to the extent that it is inconsistent with any
joint waiver previously executed with respect to such former spouse
under section 8416(a).
"(0(1) Any amount under section 8442(bX1XA) which would other-
wise be payable to a widow or widower based on the service of
another individual shall be paid (in whole or in part) by the Office to
a former spouse of such individual if and to the extent expressly
provided for in the terms of a court decree of divorce, annulment, or
legal separation, or the terms of a court order or court-approved
property settlement incident to any decree of divorce, annulment, or
legal separation.
"(2) Paragraph (1) shall apply only to payments made by the
Office after the date of receipt in the Office of written notice of such
decree, order, or agreement, and such additional information and
documentation as the Office may prescribe.
"(g) Any payment under this section to a person bars recovery by
any other person.
"SUBCHAPTER V?DISABILITY BENEFITS
"? 8451. Disability retirement 5 USC 8451.
"(aX1XA) An employee who completes at least 18 months of
civilian service creditable under section 8411 and has become dis-
abled shall be retired on the employee's own application or on
application by the employee's agency.
"(B) For purposes of this subsection, an employee shall be consid-
ered disabled only if the employee is found by the Office to be
unable, because of disease or injury, to render useful and efficient
service in the employee's position.
"(2XA) Notwithstanding paragraph (1), an employee shall not be
eligible for disability retirement under this section if the employee
has declined a reasonable offer of reassignment to a vacant position
in the employee's agency for which the employee is qualified if the
position?
is at the same grade (or pay level) as the employee's most
recent grade (or pay level) or higher;
"(ii) is within the employee's commuting area; and
"(iii) is one in which the employee would be able to render
useful and efficient service.
"(B) An employee who is applying for disability retirement under Regulations.
this subchapter shall be considered for reassignment by the em-
ployee's agency to a vacant position described in subparagraph (A)
in accordance with such procedures as the Office shall by regulation
prescribe.
"(C) An employee is entitled to appeal to the Merit Systems
Protection Board under section 7701 any determination that the
employee is not unable, because of disease or injury, to render useful
and efficient service in a position to which the employee has de-
clined reassignment under this section.
"(D) For purposes of subparagraph (A), an employee of the United
States Postal Service shall not be considered qualified for a position
if such position is in a different craft or if reassignment to such
position would be inconsistent with the terms of a collective-
bargaining agreement covering the employee.
"(b) A Member who completes at least 18 months of service as a
Member and is found by the Office to be disabled for useful and
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5 USC 8452.
42 USC 423.
42 USC 416.
42 USC 424a.
efficient service as a Member because of disease or injury shall be
retired on the Member's own application.
"(c) An employee or Member retiring under this section is entitled
to an annuity computed under section 8452.
"? 8452. Computation of disability annuity
"(a)(1)(A) Except as provided in paragraph (2), or subsection (b), (c),
or (d), the annuity of an annuitant under this subchapter?
"(i) for the period beginning on the date on which such
annuity commences, or is restored (as described in section
8455()) (2) or (3)), and ending at the end of the twelfth month
beginning on or after such date, shall be equal to 60 percent of
the annuitant's average pay; and
"(ii) after the end of the period referred to in clause (i), shall
be equal to 40 percent of the annuitant's average pay.
"(B) An annuity computed under this paragraph shall not, for
purposes of any adjustment under section 8462 (including any
adjustment under subsection (cX1) of such section), be considered to
have commenced until after such annuity ceases to be determined
under subparagraph (AXi).
"(2A) For any month in which an annuitant is entitled both to an
annuity under this subchapter as computed under paragraph (1) and
to a disability insurance benefit under section 223 of the Social
Security Act, the annuitant's annuity for such month (as so com-
puted) shall?
"(i) if such month occurs during a period referred to in
paragraph (1XAXi), be reduced by 100 percent of the annuitant's
assumed disability insurance benefit for such month; or
"(ii) if such month occurs other than during a period referred
to in paragraph (1XAXi), be reduced by 60 percent of the annu-
itant's assumed disability insurance benefit for such month;
except that an annuity may not be reduced below zero by reason of
this paragraph.
"(BX0 For purposes of this paragraph, the assumed disability
insurance benefit of an annuitant for any month shall be equal to?
"(I) the amount of the disability insurance benefit to which
the annuitant would have been entitled under section 223 of the
Social Security Act for the month in which the annuity under
this subchapter commenced, or was restored, determined as if
such annuitant had then satisfied all requirements for entitle-
ment to a benefit under such section, adjusted by
"(II) all adjustments made under section 8462(b) between the
date on which the annuity commenced, or was restored, and the
start of the month involved (without regard to whether the
annuitant's annuity was affected by any of those adjustments).
For purposes of computing the assumed disability insurance benefit,
the month in which the annuitant's disability began (as determined
under section 216(iX2XC) of the Social Security Act) shall be the
month in which the annuity commenced or, if earlier (and if a
determination was actually made) the month determined under
such section.
"(ii) For purposes of applying section 224 of the Social Security
Act to the assumed disability insurance benefit used to compute the
reduction under this paragraph, the amount of the annuity under
this subchapter which is considered shall be the amount of the
annuity as determined before the application of this paragraph.
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'(bX1) Except as provided in subsection (d), if an annuitant is
entitled to an annuity under this subchapter as of the day before the
date of the sixty-second anniversary of the annuitant's birth (herein-
after in this section referred to as the annuitant's 'redetermination
date'), such annuity shall be redetermined under paragraph (3) or
(4), as applicable. Effective as of the annuitant's redetermination
date, the annuity (as so redetermined) shall be in lieu of any annuity
to which such annuitant would otherwise be entitled under this
subchapter.
"(2A) In order to carry out paragraphs (3) and (4), the Office shall
compute an annuity for the annuitant under section 8415.
"(B) In performing a computation under this paragraph?
"(1) creditable service of the annuitant shall be increased by
including the period (or periods), if any, before the annuitant's
redetermination date during which the annuitant was entitled
to an annuity under this subchapter; and
"(ii) the average pay which would otherwise be used shall be
adjusted to reflect all adjustments made under section 8462(b)
with respect to any period (or periods) referred to in clause (i)
(without regard to whether the annuitant's annuity was
affected by any of those adjustments).
"(3) If, as of the day before the annuitant's redetermination date,
the annuitant's annuity is subject to reduction under subsection
(a2), the annuitant's redetermined annuity shall be the lesser of?
"(A) the amount determined with respect to such annuitant
under paragraph (2); or
"(B) subject to the following sentence, the amount (converted
so as to be expressed as an annual amount) which would
otherwise be payable under this subchapter for the month in
which occurs the day before the annuitant's redetermination
date, as computed under subsection (a) (based on the assumption
that the annuitant was entitled to an annuity under this sub-
chapter, and to a disability insurance benefit under section 223
of the Social Security Act, for the entirety of such month). 42 USC 423.
If the annuitant's redetermination date occurs during the period
described in subsection (aX1XA), the amount used under subpara-
graph (B) may not exceed the amount (converted so as to be ex-
pressed as an annual amount) which would otherwise be payable
under this subchapter for the first month after such period, as
computed under subsection (a) based on the assumption that the
annuitant was entitled to an annuity under this subchapter, and to
a disability insurance benefit under section 223 of the Social Secu-
rity Act, for the entirety of such month.
"(4) If, as of the day before the annuitant's redetermination date,
the annuitant's annuity is not subject to reduction under subsection
(a2), the annuitant's redetermined annuity shall be the lesser of?
"(A) the amount determined with respect to such annuitant
under paragraph (2); or
"(B) the amount which would be used for such annuitant
under subparagraph (B) of paragraph (3) (as determined subject
to the second sentence of such paragraph), if such paragraph
applied to such annuitant.
"(c) Except as provided in subsection (d), the annuity of an annu-
itant under this subchapter shall be computed under section 8415
if?
"(1) such annuity commences, or is restored, beginning on or
after the redetermination date of the annuitant; or
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"(2) as of the day on which such annuity commences, or is
restored, the annuitant satisfies the age and service require-
ments for entitlement to an annuity under section 8412 (other
than subsection (g) of such section).
"(d) The annuity to which an annuitant is entitled under this
section shall not be less than the amount of an annuity computed
under section 8415 (excluding subsection (f) of such section).
Claims. "? 8453. Application
5 USC 8453.
"A claim may be allowed under this subchapter only if application
is filed with the Office before the employee or Member is separated
from the service or within 1 year thereafter. This time limitation
may be waived by the Office for an employee or Member who, at the
date of separation from service or within 1 year thereafter, is
mentally incompetent if the application is filed with the Office
within 1 year from the date of restoration of the employee or
Member to competency or the appointment of a fiduciary, whichever
is earlier.
5 USC 8454. "? 8454. Medical examination
"An annuitant receiving a disability retirement annuity from the
Fund shall be examined under the direction of the Office?
"(I) at the end of 1 year from the date of the disability
retirement; and
"(2) annually thereafter until becoming 60 years of age;
unless the disability is permanent in character. If the annuitant
fails to submit to examination as required by this section, payment
of the annuity shall be suspended until continuance of the disability
is satisfactorily established.
5 USC 8455. "? 8455. Recovery; restoration of earning capacity
"(aX1) If an annuitant receiving a disability retirement annuity
from the Fund recovers from the disability before becoming 60 years
of age, payment of the annuity terminates on reemployment by the
Government or 1 year after the date on which the Office determines
that the annuitant has recovered, whichever is earlier.
"(2) If an annuitant receiving a disability annuity from the Fund,
before becoming 60 years of age, is restored to an earning capacity
fairly comparable to the current rate of pay of the position occupied
at the time of retirement, payment of the annuity terminates 180
days after the end of the calendar year in which earning capacity is
so restored. Earning capacity is deemed restored if in any calendar
year the income of the annuitant from wages or self-employment or
both equals at least 80 percent of the current rate of pay of the
position occupied immediately before retirement.
"(bX1) If an annuitant whose annuity is terminated under subsec-
tion (a) is not reemployed in a position in which that individual is
subject to this chapter, such individual is deemed, except for service
credit, to have been involuntarily separated from the service for the
purpose of subchapter II of this chapter as of the date of termination
of the disability annuity, and after that termination is entitled to
annuity under the applicable provisions of such subchapter.
"(2) If an annuitant whose annuity is terminated under subsection
(aX2)?
"(A) is not reemployed in a position subject to this chapter;
and
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"(B) has not recovered from the disability for which that
individual was retired;
the annuity of such individual shall be restored at the applicable
rate under section 8452 effective the first of the year following any
calendar year in which such individual's income from wages or self-
employment or both is less than 80 percent of the current rate of
pay of the position occupied immediately before retirement.
"(3) If an annuitant whose annuity is terminated because of a
medical finding that the individual has recovered from disability is
not reemployed in a position in which such individual is subject to
this chapter, the annuity of such individual shall be restored at the
applicable rate under section 8452 effective from the date on which
the Office determines that there has been a recurrence of the
disability.
"(4) Paragraphs (2) and (3) shall not apply in the case of an
annuitant receiving an annuity from the Fund under subchapter II
of this chapter.
"6 8456. Relationship to workers' compensation 5 USC 8456.
"(aX1) An individual is not entitled to receive an annuity under
this subchapter and compensation for injury to or disability of the
individual under subchapter I of chapter 81 covering the same 5 USC 8101.
period of time.
"(2) Paragraph (1) does not bar the right of a claimant to the
greater benefit conferred by either subchapter referred to in such
paragraph for any part of the period referred to in such paragraph.
"(3) Paragraph (1) and the provisions of subchapter I of chapter 81
do not deny an individual an annuity which the individual is
entitled to receive under this chapter on account of service per-
formed by the individual and do not deny any concurrent benefit to
the individual under subchapter I of chapter 81 on account of the
death of another individual.
"(bX1) Subject to paragraph (2), an individual's receipt of a lump-
sum payment for compensation under section 8135 shall not affect
the individual's entitlement to an annuity under this subchapter.
"(2) If an annuity is payable under this subchapter by reason of
the same disability for which a lump-sum payment of compensation
referred to in paragraph (1) has been made, so much of the com-
pensation as has been paid for a period extended beyond the date
payment of the annuity commences, as determined by the Depart-
ment of Labor, shall be refunded to that Department for credit to
the Employees' Compensation Fund. Before the individual may
receive the disability annuity, the individual shall?
"(A) refund to the Department of Labor the amount rep-
resenting the commuted compensation payments for the
extended period; or
"(B) authorize the deduction of the amount from the annuity.
Deductions from the annuity may be made from accrued or accruing
payments. The amounts deducted and withheld from the annuity
shall be transmitted to the Department of Labor for reimbursement
to the Employees' Compensation Fund. When the Department of
Labor finds that the financial circumstances of an individual enti-
tled to an annuity under this subchapter warrant deferred refund-
ing under this paragraph, deductions from the annuity may be
prorated against and paid from accruing payments in such manner
as the Department determines appropriate.
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5 USC 8457. "6 8457. Military reserve technicians
"(aX1) Except as provided in paragraph (2) or (3), an individual
shall be retired under this subchapter if the individual?
"(A) is separated from employment as a military reserve
technician by reason of a disability that disqualifies the individ-
ual from membership in a reserve component of the Armed
Forces specified in section 261(a) of title 10 or from holding the
military grade required for such employment;
"(B) is not considered to be disabled under section
8451(aX1XB);
"(C) is not appointed to a position in the Government
(whether under subsection (c) or otherwise); and
"(D) has not declined an offer of an appointment to a position
in the Government under subsection (c).
"(2) Payment of any annuity for an individual pursuant to this
section terminates?
"(A) on the date the individual is appointed to a position in
the Government (whether pursuant to subsection (c) or other-
wise);
"(B) on the date the individual declines an offer of appoint-
ment to a position in the Government under subsection (c); or
"(C) as provided under section 8455(a).
"(3) An individual eligible to retire under section 8414(c) shall not
be eligible to retire under this section.
"(b) Any individual applying for or receiving any annuity pursu-
ant to this section shall, in accordance with regulations prescribed
by the Office, be considered by any agency of the Government before
any vacant position in the agency is filled if?
"(1) the position is located within the commuting area of the
individual's former position;
"(2) the individual is qualified to serve in such position, as
determined by the head of the agency; and
"(3) the position is at the same grade or equivalent level as
the position from which the individual was separated.
"SUBCHAPTER VI?GENERAL AND ADMINISTRATIVE
PROVISIONS
5 USC 8461. "6 8461. Authority of the Office of Personnel Management
"(a) The Office shall pay all benefits that are payable under
subchapter II, IV, V, or VI of this chapter from the Fund.
"(b) The Office shall administer all provisions of this chapter not
specifically required to be administered by the Board, the Executive
Director, the Secretary of Labor, or any other officer or agency.
"(c) The Office shall adjudicate all claims under the provisions of
this chapter administered by the Office.
"(d) The Office shall determine questions of disability and depend-
ency arising under the provisions of this chapter administered by
the Office. Except to the extent provided under subsection (e), the
decisions of the Office concerning these matters are final and
conclusive and are not subject to review. The Office may direct at
any time such medical or other examinations as it considers nec-
essary to determine the facts concerning disability or dependency of
an individual receiving or applying for annuity under the provisions
of this chapter administered by the Office. The Office may suspend
or deny annuity for failure to submit to examination.
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"(eX1) Subject to paragraph (2), an administrative action or order
affecting the rights or interests of an individual or of the United
States under the provisions of this chapter administered by the
Office may be appealed to the Merit Systems Protection Board
under procedures prescribed by the Board.
"(2) In the case of any individual found by the Office to be disabled
in whole or in part on the basis of the individual's mental condition,
and that finding was made pursuant to an application by an agency
for purposes of disability retirement under section 8451, the proce-
dures under section 7701 shall apply and the decision of the Board
shall be subject to judicial review under section 7703.
"(f) The Office shall fix the fees for examinations made under
subchapter V of this chapter by physicians or surgeons who are not
medical officers of the United States. The fees and reasonable
traveling and other expenses incurred in connection with the
examinations are paid from appropriations for the cost of admin-
istering the provisions of this chapter administered by the Office.
"(g) The Office may prescribe regulations to carry out the provi-
sions of this chapter administered by the Office.
"(hX1) Each Government agency shall furnish the Director with
such information as the Director determines necessary in order to
administer this chapter.
"(2) The Director, in consultation with the officials from whom Regulations.
such information is requested, shall establish (by regulation or
otherwise) such safeguards as are necessary to ensure that informa-
tion made available under this subsection is used only for the
purpose authorized.
"(i) In making a determination of 'actuarial equivalence' under
this chapter, the economic assumptions used shall be the same as
the economic assumptions most recently used by the Office (before
the determination of actuarial equivalence involved) in determining
the normal-cost percentage of the System.
"(jX1) Notwithstanding any other provision of this chapter, the
Director of Central Intelligence shall, in a manner consistent with
the administration of this chapter by the Office, and to the extent
considered appropriate by the Director of Central Intelligence?
"(A) determine entitlement to benefits under this chapter
based on the service of employees of the Central Intelligence
Agency;
"(B) maintain records relating to the service of such Records.
employees;
"(C) compute benefits under this chapter based on the service
of such employees;
"(D) collect deposits to the Fund made by such employees,
their spouses, their former spouses, and their survivors;
"(E) authorize and direct disbursements from the Fund to the
extent based on service of such employees; and
"(F) perform such other functions under this chapter (other
than under subchapters III and VII of this chapter) with respect
to employees of the Central Intelligence Agency as the Director
of Central Intelligence, in consultation with the Director of the
Office of Personnel Management, determines to be appropriate.
"(2) The Director of the Office of Personnel Management shall
furnish such information and, on a reimbursable basis, such services
to the Director of Central Intelligence as the Director of Central
Intelligence requests to carry out paragraph (1).
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ivy
Regulations.
5 USC 8462.
"(kX1) The Director of Central Intelligence, in consultation with
the Executive Director of the Federal Retirement Thrift Investment
Board, may?
"(A) maintain exclusive records relating to elections, con-
tributions, and accounts under the Thrift Savings Plan provided
in subchapter III of this chapter in the case of employees of the
Central Intelligence Agency;
"(B) provide that contributions by, or on behalf of, such
employees to the Thrift Savings Plan be accounted for by such
Executive Director in aggregate amounts;
"(C) make the necessary disbursements from, and the nec-
essary allocations of earnings, losses, and charges to, individual
accounts of such employees under the Thrift Savings Plan; and
"(D) perform such other functions under subchapters III and
VII of this chapter (but not including investing sums in the
Thrift Savings Fund) with respect to employees of the Central
Intelligence Agency as the Director of Central Intelligence, in
consultation with the Executive Director of the Federal Retire-
ment Thrift Investment Board, determines to be appropriate.
"(2) The Executive Director of the Federal Retirement Thrift
Investment Board may not exercise authority under this chapter in
the case of employees of the Central Intelligence Agency to the
extent that the Director of Central Intelligence exercises authority
provided in paragraph (1).
"(3) The Executive Director of the Federal Retirement Thrift
Investment Board shall furnish such information and, on a re-
imbursable basis, such services to the Director of Central Intel-
ligence as the Director of Central Intelligence determines necessary
to carry out this subsection.
"(1) Subsection (hX1), and sections 8439(b) and 8474(cX4), shall be
applied with respect to information relating to employees of the
Central Intelligence Agency in a manner that protects intelligence
sources, methods, and activities.
"(mX1) The Director of Central Intelligence, in consultation with
the Director of the Office of Personnel Management and the Execu-
tive Director of the Federal Retirement Thrift Investment Board,
shall by regulation prescribe appropriate procedures to carry out
subsections (j), (k), and (1).
"(2) The regulations shall provide procedures for the Director of
the Office of Personnel Management to inspect and audit disburse-
ments from the Fund, and from the Thrift Savings Fund, under this
chapter.
"(3) The Director of Central Intelligence shall submit the regula-
tions prescribed under paragraph (1) to the Select Committee on
Intelligence of the Senate and the Permanent Select Committee on
Intelligence of the House of Representatives before the regulations
take effect.
"? 8462. Cost-of-living adjustments
"(a) For the purpose of this section?
"(1) the term 'base quarter', as used with respect to a year,
means the calendar quarter ending on September 30 of such
year;
"(2) the price index for a base quarter is the arithmetical
mean of such index for the 3 months comprising such quarter;
and
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"(3) the term 'percent change in the price index', as used with
respect to a year, means the percentage derived by?
'(A) reducing?
"(i) the price index for the base quarter of such year,
by
"(ii) the price index for the base quarter of the
preceding year in which an adjustment under this
subsection was made;
"(B) dividing the difference under subparagraph (A) by
the price index referred to in subparagraph (AXii); and
"(C) multiplying the quotient under subparagraph (B) by
100.
"(b)(1) Except as provided in subsection (c), effective December 1 of
any year in which an adjustment under this subsection is to be
made, as determined under paragraph (2), each annuity payable
from the Fund under this chapter (other than an annuity under
section 8443) having a commencing date not later than such Decem-
ber 1 shall be adjusted as follows:
"(A) If the percent change in the price index for the year does
not exceed 3 percent, each annuity subject to adjustment under
this subsection shall be increased by the lesser of?
"(i) the percent change in the price index (rounded to the
nearest one-tenth of 1 percent); or
"(ii) 2 percent.
"(B) If the percent change in the price index for the year
exceeds 3 percent, each annuity subject to adjustment under
this subsection shall be increased by the excess of?
"(i) the percent change in the price index (rounded to the
nearest one-tenth of 1 percent), over
"(ii) 1 percent.
"(2) An adjustment under this subsection shall be made in a year
only if the price index for the base quarter of such year exceeds the
price index for the base quarter of the preceding year in which an
adjustment under this subsection was made.
`(3) An annuity under this chapter shall not be subject to adjust-
ment under section 8340.
"(c) Eligibility for an annuity increase under this section is gov-
erned by the commencing date of each annuity payable from the
Fund as of the effective date of an increase, except as follows:
"(1) The first increase (if any) made under subsection (b) to an
annuity which is payable from the Fund to an annuitant or
survivor (other than a child under section 8443) whose annuity
has not been increased under this subsection or subsection (b)
shall be equal to the product (adjusted to the nearest one-tenth
of 1 percent) of?
"(A) one-twelfth of the applicable percent change com-
puted under subsection (b), multiplied by
"(B) the number of months (not to exceed 12 months,
counting any portion of a month as a month)?
"(i) for which the annuity was payable from the Fund
before the effective date of the increase; or
"(ii) in the case of a survivor of a deceased annuitant
whose annuity has not been so increased, since the
annuity was first payable to the deceased annuitant.
"(2) Effective from its commencing date, an annuity payable
from the Fund to an annuitant's survivor (other than a widow
or widower whose annuity is computed under section 8442(g) or
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iuu OTA1. D(41 r u JaLde LAW 99-335?JUNE 6, 1986
Post, pp. 589,
591-593.
5 USC 8463. "6 8463. Rate of benefits
a child under section 8443) shall be increased by the total
percentage by which the deceased annuitant's annuity had been
increased under this section during the period beginning on the
date the deceased annuitant's annuity commenced and ending
on the date of the deceased annuitant's death.
"(3XA) An adjustment under subsection (b) for any year shall
not be effective with respect to the annuity of an annuitant who
is under 62 years of age as of the date on which such adjustment
would otherwise first take effect.
"(BXi) Except as provided in clause (ii), this paragraph applies
only with respect to an annuitant under section 8412, 8413, or
8414.
"(ii) This paragraph does not apply with respect to an annu-
itant under subsection (d) or (e) of section 8412 or (in the case of
an annuitant separated from service as a military reserve
technician as a result of disability) under section 8414(c).
"(4) The first increase (if any) made under subsection (b) to an
annuity which is payable from the Fund to a widow or widower
whose annuity is computed under section 8442(g) shall be equal
to the product (adjusted to the nearest one-tenth of 1 percent)
of?
"(A) one-twelfth of the applicable percent change com-
puted under subsection (b), multiplied by
"(B) the number of months (not to exceed 12 months,
counting any portion of a month as a month) since?
"(i) the effective date of the adjustment last made
under this section in the annuity of the annuitant on
whose service on the widow's or widower's annuity is
based; or
"(ii) if the annuity of the annuitant (referred to in
clause (i)) has not been increased under this section, the
commencement date of such annuitant's annuity
(determined subject to section 8452(aX1XB)).
"(d) The monthly installment of an annuity after adjustment
under this section shall be rounded to the next lowest dollar.
However, the monthly installment shall, after adjustment, reflect
an increase of at least $1.
"(e) The $15,000 amount referred to in section 8442(13)(1XAXii)
shall be increased at the same time that, and by the same percent as
the percentage by which, annuities under subchapter III of chapter
83 are increased.
"Each annuity payable from the Fund is stated as an annual
amount, one-twelfth of which, rounded to the next lower dollar,
constitutes the monthly rate payable on the first business day of the
first month beginning after the month for which it has accrued.
5 USC 8464. "6 8464. Commencement and termination of annuities of employ-
ees and Members
"(aX1) Except as otherwise provided in this chapter?
"(A) an annuity payable from the Fund commences on the
first day of the month after?
"(i) separation from the service, in the case of an em-
ployee or Member retiring under section 8412, or subsection
(a) or (bX1XB) of section 8414; or
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YUBLIU LAW 99-335?JUNE 6, 1986 100 STAT. 575
"(ii) pay ceases, and the applicable age and service
requirements are met, in the case of an employee or
Member retiring under section 8413;
"(B) an annuity payable from the Fund commences on the day
after separation from the service in the case of an employee
retiring under subsection (bX1XA) or (c) of section 8414; and
"(C) an annuity payable from the Fund commences on the day
after separation from the service or the day after pay ceases and
the requirements for title to an annuity are met in the case of
an employee or Member retiring under section 8451.
"(2) Notwithstanding paragraph (1XAXi), an annuity payable from
the Fund commences on the day after separation from the service in
the case of an employee or Member?
"(A) who retires under section 8412; and
"(B) whose separation occurs upon the expiration of a term (or
other period) for which the individual was appointed or elected.
"(b) Except as otherwise provided in this chapter, the annuity of
an annuitant under subchapter II or V of this chapter terminates on
the date death or other terminating event occurs.
"? 8465. Waiver, allotment, and assignment of benefits
"(a) An individual entitled to an annuity payable from the Fund
may decline to accept all or any part of the amount of the annuity
by a waiver signed and filed with the Office. The waiver may be
revoked in writing at any time. Payment of the annuity waived may
not be made for the period during which the waiver is in effect.
"(b) An individual entitled to an annuity payable from the Fund
may make allotments or assignments of amounts from the annuity
for such purposes as the Office considers appropriate.
"? 8466. Application for benefits
"(a) No payment of benefits based on the service of an employee or
Member shall be made from the Fund unless an application for
payment of the benefits is received by the Office before the one
hundred and fifteenth anniversary of the birth of the employee or
Member.
"(b) Notwithstanding subsection (a), after the death of an
employee, Member, or annuitant, or former employee or Member, a
benefit based on the service of such employee, Member, or annu-
itant, or former employee or Member, shall not be paid under
subchapter II or IV of this chapter unless an application therefor is
received by the Office within 30 years after the death or other event
which establishes the entitlement to the benefit.
"(c) Payment due a minor, or an individual mentally incompetent
or under other legal disability, may be made to the person who is
constituted guardian or other fiduciary by the law of the State of
residence of the claimant or is otherwise legally vested with the care
of the claimant or his estate. If a guardian or other fiduciary of the
individual under legal disability has not been appointed under the
law of the State of residence of the claimant, payment may be made
to any person who, in the judgment of the Office, is responsible for
the care of the claimant, and the payment bars recovery by any
other person.
"? 8467. Court orders
"(a) Payments under this chapter which would otherwise be made
to an employee, Member, or annuitant (including an employee,
5 USC 8465.
5 USC 8466.
Children and
youth.
Disabled
persons.
5 USC 8467.
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Member, or annuitant as defined under section 8331) based on the
service of that individual shall be paid (in whole or in part) by the
Office or the Executive Director (as the case may be), to another
person if and to the extent that the terms of any court decree of
divorce, annulment, or legal separation, or the terms of any court
order or court-approved property settlement agreement incident to
any court decree of divorce, annulment, or legal separation
expressly provide. Any payment under this subsection to a person
bars recovery by any other person.
"(b) Subsection (a) shall apply only to payments made by the
Office or the Executive Director under this chapter after the date on
which the Office or the Executive Director (as the case may be)
receives written notice of such decree, order, or agreement, and such
additional information and documentation as the Office or the
Executive Director may require.
5 USC 8468. "0 8468. Annuities and pay on reemployment
"(a) If an annuitant becomes employed in an appointive or elective
position in the Government, payment of any annuity under sub-
chapter II or V of this chapter to the annuitant terminates effective
on the date of the employment. The annuitant's service on and after
the date the annuitant becomes so employed is covered by this
chapter unless such service is performed as a justice or judge of the
United States (as defined by section 451 of title 28) or as an
employee subject to another retirement system for Government
employees. Upon termination of the employment, the rights of the
annuitant under subchapter II or V of this chapter (as the case may
be) shall be redetermined. If the annuitant dies while still so
employed, a survivor annuity payable with respect to the deceased
annuitant shall be redetermined as if the employment had other-
wise terminated on the date of death.
"(b) The amount of an annuity resulting from a redetermination
of rights under this chapter pursuant to subsection (a) shall not be
less than the amount of the terminated annuity plus any increases
which (but for the reemployment) would have been payable under
section 8462 after the termination of the annuity and before the
commencement of the redetermined annuity.
"(c) The redetermined annuity commences on the first day of the
month after termination of employment.
5 USC 8469. "0 8469. Withholding of State income taxes
Contracts. "(a) The Office shall, in accordance with this section, enter into an
agreement with any State within 120 days of a request for agree-
ment from the proper State official. The agreement shall provide
that the Office shall withhold State income tax in the case of the
monthly annuity of any annuitant who voluntarily requests, in
writing, such withholding. The amounts withheld during any cal-
endar quarter shall be held in the Fund and disbursed to the States
during the month following that calendar quarter.
"(b) An annuitant may have in effect at any time only one request
for withholding under this section, and an annuitant may not have
more than two such requests in effect during any one calendar year.
"(c) Subject to subsection (b), an annuitant may change the State
designated by that annuitant for purposes of having withholdings
made, and may request that the withholdings be remitted in accord-
ance with such change. An annuitant also may revoke any request
of that annuitant for withholding. Any change in the State des-
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ut, 1986 100 STAT. 577
ignated or revocation is effective on the first day of the month after
the month in which the request or the revocation is processed by the
Office, but in no event later than on the first day of the second
month beginning after the day on which such request or revocation
is received by the Office.
"(d) This section does not give the consent of the United States to
the application of a statute which imposes more burdensome
requirements on the United States than on employers generally, or
which subjects the United States or any annuitant to a penalty or
liability because of this section. The Office may not accept pay from
a State for services performed in withholding State income taxes
from annuities. Any amount erroneously withheld from an annuity
and paid to a State by the Office shall be repaid by the State in
accordance with regulations issued by the Office.
"(e) For the purpose of this section?
"(1) the term 'State' means a State, the District of Columbia,
or any territory or possession of the United States; and
"(2) the term 'annuitant' includes a survivor who is receiving
an annuity from the Fund.
"? 8470. Exemption from legal process; recovery of payments
"(a) An amount payable under subchapter II, IV, or V of this
chapter is not assignable, either in law or equity, except under the
provisions of section 8465 or 8467, or subject to execution, levy,
attachment, garnishment or other legal process, except as otherwise
may be provided by Federal laws.
"(b) Recovery of payments under subchapter II, IV, or V of this
chapter may not be made from an individual when, in the judgment
of the Office, the individual is without fault and recovery would be
against equity and good conscience. Withholding or recovery of
money paid under subchapter II, IV, or V of this chapter on account
of a certification or payment made by a former employee of the
United States in the discharge of his official duties may be made
only if the head of the agency on behalf of which the certification or
payment was made certifies to the Office that the certification or
payment involved fraud on the part of the former employee.
"SUBCHAPTER VII?FEDERAL RETIREMENT THRIFT
INVESTMENT MANAGEMENT SYSTEM
5 USC 8470.
"0 8471. Definitions 5 USC 8471.
"For the purposes of this subchapter?
"(1) the term 'beneficiary' means an individual (other than a
participant) entitled to payment from the Thrift Savings Fund
under subchapter III of this chapter;
"(2) the term 'Council' means the Employee Thrift Advisory
Council established under section 8473 of this title;
"(3) the term 'participant' means an individual for whom an
account has been established under section 8439 of this title;
"(4) the term 'person' means an individual, partnership, joint
venture, corporation, mutual company, joint-stock company,
trust, estate, unincorporated organization, association, or labor
organization; and
"(5) the term 'Thrift Savings Fund' means the Thrift Savings
Fund established under section 8437 of this title.
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x- En.,ie LAW 99-335?JUNE 6, 1986
5 USC 8472. "? 8472. Federal Retirement Thrift Investment Board
"(a) There is established in the Executive branch of the Govern-
ment a Federal Retirement Thrift Investment Board.
"(b) The Board shall be composed of?
"(1) 3 members appointed by the President, of whom 1 shall
be designated by the President as Chairman; and
"(2) 2 members appointed by the President, of whom?
"(A) 1 shall be appointed by the President after taking
into consideration the recommendation made by the
Speaker of the House of Representatives in consultation
with the minority leader of the House of Representatives;
and
"(B) 1 shall be appointed by the President after taking
into consideration the recommendation made by the major-
ity leader of the Senate in consultation with the minority
leader of the Senate.
"(c) Except as provided in section 311 of the Federal Employees'
Retirement System Act of 1986, appointments under subsection (a)
shall be made by and with the advice and consent of the Senate.
"(d) Members of the Board shall have substantial experience,
training, and expertise in the management of financial investments
and pension benefit plans.
"(eX1) Except as provided in section 311 of the Federal Employees'
Retirement System Act of 1986, a member of the Board shall be
appointed for a term of 4 years, except that of the members first
appointed (other than the members appointed under such section)?
"(A) the Chairman shall be appointed for a term of 4 years;
"(B) the members appointed under subsection (bX2) shall be
appointed for terms of 3 years; and
"(C) the remaining members shall be appointed for terms of 2
years.
"(2XA) A vacancy on the Board shall be filled in the manner in
which the original appointment was made and shall be subject to
any conditions which applied with respect to the original
appointment.
"(B) An individual chosen to fill a vacancy shall be appointed for
the unexpired term of the member replaced.
"(3) The term of any member shall not expire before the date on
which the member's successor takes office.
"(f) The Board shall?
"(1) establish policies for?
"(A) the investment and management of the Thrift Sav-
ings Fund; and
"(B) the administration of subchapter III of this chapter;
"(2) review the performance of investments made for the
Thrift Savings Fund; and
"(3) review and approve the budget of the Board.
"(gX1) The Board may?
"(A) adopt, alter, and use a seal;
"(B) except as provided in paragraph (2), direct the Executive
Director to take such action as the Board considers appropriate
to carry out the provisions of this subchapter and subchapter III
of this chapter and the policies of the Board;
"(C) upon the concurring votes of four members, remove the
Executive Director from office for good cause shown; and
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"(D) take such other actions as may be necessary to carry out
the functions of the Board.
"(2) Except in the case of investments required by section 8438 of
this title to be invested in securities of the Government, the Board
may not direct the Executive Director to invest or to cause to be
invested any sums in the Thrift Savings Fund in a specific asset or
to dispose of or cause to be disposed of any specific asset of such
Fund.
"(h) The members of the Board shall discharge their responsibil-
ities solely in the interest of participants and beneficiaries under
this subchapter and subchapter III of this chapter.
"fi 8473. Employee Thrift Advisory Council
"(a) The Board shall establish an Employee Thrift Advisory Coun-
cil. The Council shall be composed of 14 members appointed by the
Chairman of the Board in accordance with subsection (b).
"(b) The Chairman shall appoint 14 members of the Council, of
whom?
"(1) 4 shall be appointed to represent the respective labor
organizations representing (as exclusive representatives) the
first, second, third, and fourth largest numbers of individuals
subject to chapter 71 of this title;
"(2) 2 shall be appointed to represent the respective labor
organizations which have been accorded exclusive recognition
under section 1203(a) of title 39 representing the largest and
second largest numbers of individuals employed by the United
States Postal Service;
"(3) 1 shall be appointed to represent the labor organization
which has been accorded exclusive recognition under section
1203(a) of title 39 representing the largest number of individuals
employed by the United States Postal Service as rural letter
carriers;
"(4) 2 shall be appointed to represent the respective manage-
rial organizations (other than an organization described in para-
graph (5)) which consult with the United States Postal Service
under section 1004(b) of title 39 and which represent the largest
and second largest numbers of individuals employed by the
United States Postal Service as managerial personnel;
"(5) 1 shall be appointed to represent the supervisors'
organization as defined in section 1004(h) of title 39;
"(6) 1 shall be appointed to represent employee organizations
having as a purpose promoting the interests of women in
Government service;
"(7) 1 shall be appointed to represent the organization rep-
resenting the largest number of individuals receiving annuities
under this chapter or chapter 83 of this title;
"(8) 1 shall be appointed to represent the organization rep-
resenting the largest number of individuals subject to the
Performance Management and Recognition System under chap-
ter 54 of this title; and
"(9) 1 shall be appointed to represent the organization rep-
resenting the largest number of members of the Senior Execu-
tive Service.
"(cX1) The Chairman of the Board shall designate 1 member of the
Council to serve as head of the Council.
"(2) A member of the Council shall be appointed for a term of 4
years.
5 USC 8473.
5 USC 7101 et
seq.
5 USC 8301 et
seq.
5 USC 5401 et
seq.
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thu ..111.1. bU ruBLIC LAW 99-335?JUNE 6, 1986
5 USC app.
5 USC 8474.
Contracts.
Regulations.
5 USC 3109.
"(3XA) A vacancy in the Council shall be filled in the manner in
which the original appointment was made and shall be subject to
any conditions which applied with respect to the original
appointment.
"(B) An individual chosen to fill a vacancy shall be appointed for
the unexpired term of the member replaced.
"(C) The term of any member shall not expire before the date on
which the member's successor takes office.
"(d) The Council shall act by resolution of a majority of the
members.
"(e) The Council shall?
"(1) advise the Board and the Executive Director on matters
relating to?
"(A) investment policies for the Thrift Savings Fund; and
"(B) the administration of this subchapter and sub-
chapter III of this chapter; and
"(2) perform such other duties as the Board may direct with
respect to investment funds established in accordance with
subchapter III of this chapter.
"(f) Section 14(aX2) of the Federal Advisory Committee Act shall
not apply to the Council.
"? 8474. Executive Director
"(aX1) The Board shall appoint, without regard to the provisions of
law governing appointments in the competitive service, an Execu-
tive Director by action agreed to by a majority of the members of the
Board.
"(2) The Executive Director shall have substantial experience,
training, and expertise in the management of financial investments
and pension benefit plans.
"(b) The Executive Director shall?
"(1) carry out the policies established by the Board;
"(2) invest and manage the Thrift Savings Fund in accordance
with the investment policies and other policies established by
the Board;
"(3) purchase annuity contracts and provide for the payment
of other benefits under subchapter III of this chapter;
"(4) administer the provisions of this subchapter and sub-
chapter III of this chapter;
"(5) prescribe such regulations (other than regulations relat-
ing to fiduciary responsibilities) as may be necessary for the
administration of this subchapter and subchapter III of this
chapter; and
"(6) meet from time to time with the Council upon request of
the Council.
"(c) The Executive Director may?
"(1) prescribe such regulations as may be necessary to carry
out the responsibilities of the Executive Director under this
section, other than regulations relating to fiduciary
responsibilities;
"(2) appoint such personnel as may be necessary to carry out
the provisions of this subchapter and subchapter III of this
chapter;
"(3) subject to approval by the Board, procure the services of
experts and consultants under section 3109 of this title;
"(4) secure directly from an Executive agency, the United
States Postal Service, or the Postal Rate Commission any
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information necessary to carry out the provisions of this sub-
chapter or subchapter ifi of this chapter and policies of the
Board;
"(5) make such payments out of sums in the Thrift Savings
Fund as the Executive Director determines are necessary to
carry out the provisions of this subchapter and subchapter III of
this chapter and the policies of the Board;
"(6) pay the compensation, per diem, and travel expenses of
individuals appointed under paragraphs (2), (3), and (7) of this
subsection from the Thrift Savings Fund;
"(7) accept and use the services of individuals employed inter-
mittently in the Government service and reimburse such
individuals for travel expenses, as authorized by section 5703 of
this title, including per diem as authorized by section 5702 of 5 USC 5703.
this title; 5 USC 5702.
"(8) except as otherwise expressly prohibited by law or the
policies of the Board, delegate any of the Executive Director's
functions to such employees under the Board as the Executive
Director may designate and authorize such successive
redelegations of such functions to such employees under the
Board as the Executive Director...may consider to be necessary or
appropriate; and
"(9) take such other actions as are appropriate to carry out
the functions of the Executive Director.
"? 8475. Investment policies 5 USC 8475.
"The Board shall develop investment policies under section
8472(0(1) of this title which provide for?
"(1) prudent investments suitable for accumulating funds for
payment of retirement income; and
"(2) low administrative costs.
"? 8476. Administrative provisions 5 USC 8476.
"(a) The Board shall meet?
"(1) not less than once during each month; and
"(2) at additional times at the call of the Chairman.
"(b)(1) Except as provided in sections 8472(gX1XC) and 8474(aX1) of
this title, the Board shall perform the functions and exercise the
powers of the Board on a majority vote of a quorum of the Board.
"(2) A vacancy on the Board shall not impair the authority of a
quorum of the Board to perform the functions and exercise the
powers of the Board.
"(c) Three members of the Board shall constitute a quorum for the
transaction of business.
"(dX1) Each member of the Board who is not an officer or em-
ployee of the Federal Government shall be compensated at the daily
rate of basic pay for grade GS-18 of the General Schedule for each 5 USC 5332.
day during which such member is engaged in performing a function
of the Board.
"(2) A member of the Board shall be paid travel, per diem, and
other necessary expenses under subchapter I of chapter 57 of this
title while traveling away from such member's home or regular 5 USC 5701.
place of business in the performance of the duties of the Board.
"(3) Payments authorized under this subsection shall be paid from
the Thrift Savings Fund.
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kJ J. CI. J. . e_JCIG E 1/1-J1k.3 LAW 99-335?JUNE 6, 1986
5 USC 8477.
15 USC 78f.
"(e) The accrued annual leave of any employee who is a member
of the Board or the Council shall not be charged for any time used in
performing services for the Board or the Council.
"? 8477. Fiduciary responsibilities; liability and penalties
"(a) For the purposes of this section?
"(1) the term 'account' is not limited by the definition pro-
vided in section 8401(1);
"(2) the term 'adequate consideration' means?
"(A) in the case of a security for which there is a gen-
erally recognized market?
"(i) the price of the security prevailing on a national
securities exchange which is registered under section 6
of the Securities Exchange Act of 1934; or
"(ii) if the security is not traded on such a national
securities exchange, a price not less favorable to the
Thrift Savings Fund than the offering price for the
security as established by the current bid and asked
prices quoted by persons independent of the issuer and
of any party in interest; and
"(B) in the case of an asset other than a security for
which there is a gmerally recognized market, the fair
market value of the asset as determined in good faith by a
fiduciary or fiduciaries in accordance with regulations pre-
scribed by the Secretary of Labor;
"(3) the term 'fiduciary' means?
"(A) a member of the Board;
"(B) the Executive Director;
"(C) any person who has or exercises discretionary
authority or discretionary control over the management or
disposition of the assets of the Thrift Savings Fund; and
"(D) any person who, with respect to the Thrift Savings
Fund, is described in section 3(21XA) of the Employee
Retirement Income Security Act of 1974 (29 U.S.C.
1002(21XA)); and
"(4) the term 'party in interest' includes?
"(A) any fiduciary;
"(B) any counsel to a person who is a fiduciary, with
respect to the actions of such person as a fiduciary;
"(C) any participant;
"(D) any person providing services to the Board and, with
respect to the actions of the Executive Director as a
fiduciary any person providing services to the Executive
Director;
"(E) a labor organization, the members of which are
participants;
"(F) a spouse, sibling, ancestor, lineal descendant, or
spouse of a lineal descendant of a person described in
subparagraph (A), (B), or (D);
"(G) a corporation, partnership, or trust or estate of
which, or in which, at least 50 percent of?
"(i) the combined voting power of all classes of stock
entitled to vote or the total value of shares of all classes
of stock of such corporation;
"(ii) the capital interest or profits interest of such
partnership; or
"(iii) the beneficial interest of such trust or estate,
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PUBLIC LAW 99-335?JUNE 6, 1986 100 STAT. 583
is owned directly or indirectly, or held by a person
described in subparagraph (A), (B), (D), or (E);
"(H) an official (including a director) of, or an individual
employed by, a person described in subparagraph (A), (B),
(D), (E), or (G), or an individual having powers or respon-
sibilities similar to those of such an official;
"(I) a holder (directly or indirectly) of at least 10 percent
of the shares in a person described in any subparagraph
referred to in subparagraph (H); and
"(J) a person who, directly or indirectly, is at least a 10
percent partner or joint venturer (measured in capital or
profits) in a person described in any subparagraph referred
to in subparagraph (H).
"(bX1) To the extent not inconsistent with the provisions of this
chapter and the policies prescribed by the Board, a fiduciary shall
discharge his responsibilities with respect to the Thrift Savings
Fund or applicable portion thereof solely in the interest of the
participants and beneficiaries and?
"(A) for the exclusive purpose of?
"(i) providing benefits to participants and their bene-
ficiaries; and
"(ii) defraying reasonable expenses of administering the
Thrift Savings Fund or applicable portions thereof;
"(B) with the care, skill, prudence, and diligence under the
circumstances then prevailing that a prudent individual acting
in a like capacity and familiar with such matters would use in
the conduct of an enterprise of a like character and with like
objectives; and
"(C) to the extent permitted by section 8438 of this title, by
diversifying the investments of the Thrift Savings Fund or
applicable portions thereof so as to minimize the risk of large
losses, unless under the circumstances it is clearly prudent not
to do so.
"(2) No fiduciary may maintain the indicia of ownership of any
assets of the Thrift Savings Fund outside the jurisdiction of the
district courts of the United States.
"(cX1) A fiduciary shall not permit the Thrift Savings Fund to
engage in any of the following transactions, except in exchange for
adequate consideration:
"(A) A transfer of any assets of the Thrift Savings Fund to
any person the fiduciary knows or should know to be a party in
interest or the use of such assets by any such person.
"(B) An acquisition of any property from or sale of any
property to the Thrift Savings Fund by any person the fiduciary
knows or should know to be a party in interest.
"(C) A transfer or exchange of services between the Thrift
Savings Fund and any person the fiduciary knows or should
know to be a party in interest.
"(2) Notwithstanding paragraph (1), a fiduciary with respect to the
Thrift Savings Fund shall not?
"(A) deal with any assets of the Thrift Savings Fund in his
own interest or for his own account;
"(B) act, in an individual capacity or any other capacity, in
any transaction involving the Thrift Savings Fund on behalf of
a party, or representing a party, whose interests are adverse to
the interests of the Thrift Savings Fund or the interests of its
participants or beneficiaries; or
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11JU iii. 064 ruisLIC LAW 99-335?JUNE 6, 1986
"(C) receive any consideration for his own personal account
from any party dealing with sums credited to the Thrift Savings
Fund in connection with a transaction involving assets of the
Thrift Savings Fund.
"(3XA) The Secretary of Labor may, in accordance with proce-
dures which the Secretary shall by regulation prescribe, grant a
conditional or unconditional exemption of any fiduciary or trans-
action, or class of fiduciaries or transactions, from all or part of the
restrictions imposed by paragraph (2).
"(B) An exemption granted under this paragraph shall not relieve
a fiduciary from any other applicable provision of this chapter.
"(C) The Secretary of Labor may not grant an exemption under
this paragraph unless he finds that such exemption is?
"(i) administratively feasible;
"(ii) in the interests of the Thrift Savings Fund and of its
participants and beneficiaries; and
"(iii) protective of the rights of participants and beneficiaries
of such Fund.
"(D) An exemption under this paragraph may not be granted
unless?
"(i) notice of the proposed exemption is published in the
Federal Register;
"(ii) interested persons are given an opportunity to present
views; and
"(iii) the Secretary of Labor affords an opportunity for a
hearing and makes a determination on the record with respect
to the respective requirements of clauses (i), (ii), and (iii) of
subparagraph (C).
"(d) This section does not prohibit any fiduciary from?
"(1) receiving any benefit which the fiduciary is entitled to
receive under this subchapter or subchapter III of this chapter
as a participant or beneficiary;
"(2) receiving any reasonable compensation authorized by this
subchapter for services rendered, or for reimbursement of
expenses properly and actually incurred, in the performance of
the fiduciary's duties under this chapter; or
"(3) serving as a fiduciary in addition to being an officer,
employee, agent, or other representative of a party in interest.
"(eX1XA) Any fiduciary that breaches the responsibilities, duties,
and obligations set out in subsection (b) or violates subsection (c)
shall be personally liable to the Thrift Savings Fund for any losses
to such Fund resulting from each such breach or violation and to
restore to such Fund any profits made by the fiduciary through use
of assets of such Fund by the fiduciary, and shall be subject to such
other equitable or remedial relief as a court considers appropriate. A
fiduciary may be removed for a breach referred to in the preceding
sentence.
"(B) The Secretary of Labor may assess a civil penalty against a
party in interest with respect to each transaction which is engaged
in by the party in interest and is prohibited by subsection (c). The
amount of such penalty shall be equal to 5 percent of the amount
involved in each such transaction (as defined in section 4975(0(4) of
26 USC 4975. the Internal Revenue Code of 1954) for each year or part thereof
during which the prohibited transaction continues, except that, if
the transaction is not corrected (in such manner as the Secretary of
Labor shall prescribe by regulation consistent with section 4975(0(5)
of such Code) within 90 days after the date the Secretary of Labor
Law enforce-
ment and
crime.
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1.).1.411.? ivv n,-oou?JUNE 6, 1986 100 STAT. 585
transmits notice to the party in interest (or such longer period as the
Secretary of Labor may permit), such penalty may be in an amount
not more than 100 percent of the amount involved.
"(C) A fiduciary shall not be liable under subparagraph (A) with
respect to a breach of fiduciary duty under subsection (b) committed
before becoming a fiduciary or after ceasing to be a fiduciary.
"(D) A fiduciary shall be jointly and severally liable under
subparagraph (A) for a breach of fiduciary duty under subsection (b)
by another fiduciary if?
"(i) the fiduciary participates knowingly in, or knowingly
undertakes to conceal, an act or omission of such other fidu-
ciary, knowing such act or omission is such a breach;
"(ii) by the fiduciary's failure to comply with subsection (b) in
the administration of the fiduciary's specific responsibilities
which give rise to the fiduciary status, the fiduciary has enabled
such other fiduciary to commit such a breach; or
"(iii) the fiduciary has knowledge of a breach by such other
fiduciary, unless the fiduciary makes reasonable efforts under
the circumstances to remedy the breach.
"(E) The Secretary of Labor shall prescribe, in regulations, proce- Regulations.
dures for allocating fiduciary responsibilities among fiduciaries,
including investment managers. Any fiduciary who, pursuant to
such procedures, allocates to a person or persons any fiduciary
responsibility shall not be liable for an act or omission of such
person or persons unless?
"(i) such fiduciary violated subsection (b) with respect to the
allocation, with respect to the implementation of the procedures
prescribed by the Board, or in continuing such allocation; or
"(ii) such fiduciary would otherwise be liable in accordance
with subparagraph (D).
"(2) A civil action may be brought in the district courts of the Courts, U.S.
United States?
"(A) by the Secretary of Labor?
"(i) to determine and enforce a liability under paragraph
(1)(A);
"(ii) to collect any civil penalty under paragraph (1XB); or
"(iii) to enjoin any act or practice which violates subsec-
tion (gX2) or (h) of section 8472 of this title;
"(B) by the Secretary of Labor, any participant, beneficiary,
or fiduciary?
"(i) to enjoin any act or practice which violates any
provision of subsection (b) or (c); or
"(ii) to obtain any other appropriate equitable relief to
redress a violation of any such provision; or
"(C) by any participant or beneficiary to recover benefits due
to him or her under the provisions of subchapter III of this
chapter, to enforce his or her rights under such provisions, or to
clarify his or her rights to future benefits under such provisions.
"(3) An action may not be commenced under paragraph (2) with
respect to a fiduciary's breach of any responsibility, duty, or obliga-
tion under subsection (b) or a violation of subsection (c) after the
earlier of?
"(A) 6 years after (i) the date of the last action which con-
stituted a part of the breach or violation, or (ii) in the case of an
omission, the latest date on which the fiduciary could have
cured the breach or violation; or
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100 STAT. 586 PUBLIC LAW 99-335?JUNE 6, 1986
Courts, U.S.
5 USC 8478.
"(B) 3 years after the earliest date on which the plaintiff had
actual knowledge of the breach or violation, except that, in the
case of fraud or concealment, such action may be commenced
not later than 6 years after the date of discovery of such breach
or violation.
"(4XA) The district courts of the United States shall have exclu-
sive jurisdiction of civil actions under this subsection.
"(B) An action under this subsection may be brought in the
District Court of the United States for the District of Columbia or a
district court of the United States in the district where the breach
alleged in the complaint or petition filed in the action took place or
in the district where a defendant resides or may be found. Process
may be served in any other district where a defendant resides or
may be found.
"(5XA) A copy of the complaint or petition filed in any action
brought under this subsection (other than by the Secretary of Labor)
shall be served on the Executive Director, the Secretary of Labor,
and the Secretary of the Treasury by certified mail.
"(B) Any officer referred to in subparagraph (A) of this paragraph
shall have the right in his discretion to intervene in any action. If
the Secretary of Labor brings an action under paragraph (2) of this
subsection on behalf of a participant or beneficiary, he shall notify
the Executive Director and the Secretary of the Treasury.
"U) The Secretary of Labor may prescribe regulations to carry out
this section.
"(g)(1) The Secretary of Labor shall establish a program to carry
out audits to determine the level of compliance with the require-
ments of this section relating to fiduciary responsibilities and
prohibited activities of fiduciaries.
"(2) An audit under this subsection may be conducted by the
Secretary of Labor, by contract with a qualified non-governmental
organization, or in cooperation with the Comptroller General of the
United States, as the Secretary considers appropriate.
"? 8478. Bonding
"(aX1) Except as provided in paragraph (2), each fiduciary (other
than a member of the Employee Thrift Advisory Council with
respect to his duties as a member) and each person who handles
funds or property of the Thrift Savings Fund shall be bonded as
provided in this section.
"(2XA) Bond shall not be required of a fiduciary (or of any officer
or employee of such fiduciary) if such fiduciary?
"(i) is a corporation organized and doing business under the
laws of the United States or of any State;
"(ii) is authorized under such laws to exercise trust powers or
to conduct an insurance business;
"(iii) is subject to supervision or examination by Federal or
State authority; and
"(iv) has at all times a combined capital and surplus in excess
of such minimum amount (not less than $1,000,000) as the
Secretary of Labor prescribes in regulations.
"(B) If?
"(i) a bank or other financial institution would, but for this
subparagraph, not be required to be bonded under this section
by reason of the application of the exception provided in
subparagraph (A),
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.,,,,JUNE 6, 1986 100 STAT. 587
"(ii) the bank or financial institution is authorized to exercise
trust powers, and
"(iii) the deposits of the bank or financial institution are not
insured by the Federal Deposit Insurance Corporation or the
Federal Savings and Loan Insurance Corporation,
such exception shall apply to such bank or financial institution only
if the bank or institution meets bonding requirements under State
law which the Secretary of Labor determines are at least equivalent
to those imposed on banks by Federal law.
"(bX1) The Secretary of Labor shall prescribe the amount of a
bond under this section at the beginning of each fiscal year. Except
as otherwise provided in this paragraph, such amount shall not be
less than 10 percent of the amount of funds handled. In no case shall
such bond be less than $1,000 nor more than $500,000, except that
the Secretary of Labor, after due notice and opportunity for hearing
to all interested parties, and other consideration of the record, may
prescribe an amount in excess of $500,000.
"(2) For the purpose of prescribing the amount of a bond under
paragraph (1), the amount of funds handled shall be determined by
reference to the amount of the funds handled by the person, group,
or class to be covered by such bond or by their predecessor or
predecessors, if any, during the preceding fiscal year, or to the
amount of funds to be handled during the current fiscal year by
such person, group, or class, estimated as provided in regulations
prescribed by the Secretary of Labor.
"(c) A bond required by subsection (a)?
"(1) shall include such terms and conditions as the Secretary
of Labor considers necessary to protect the Thrift Savings Fund
against loss by reason of acts of fraud or dishonesty on the part
of the bonded person directly or through connivance with
others;
"(2) shall have as surety thereon a corporate surety company
which is an acceptable surety on Federal bonds under authority
granted by the Secretary of the Treasury pursuant to sections 6
through 13 of title 6; and
"(3) shall be in a form or of a type approved by the Secretary
of Labor, including individual bonds or schedule or blanket
forms of bonds which cover a group or class.
"(dX1) It shall be unlawful for any person to whom subsection (a) Law enforce-
applies, to receive, handle, disburse, or otherwise exercise custody or ment and
control of any of the funds or other property of the Thrift Savings crime.
Fund without being bonded as required by this section.
"(2) It shall be unlawful for any fiduciary, or any other person
having authority to direct the performance of functions described in
paragraph (1), to permit any such function to be performed by any
person to whom subsection (a) applies unless such person has met
the requirements of such subsection.
"(e) Notwithstanding any other provision of law, any person who
is required to be bonded as provided in subsection (a) shall be
exempt from any other provision of law which would, but for this
subsection, require such person to be bonded for the handling of the
funds or other property of the Thrift Savings Fund.
"(f) The Secretary of Labor shall prescribe such regulations as Regulations.
may be necessary to carry out the provisions of this section, includ-
ing exempting a person or class of persons from the requirements of
this section.
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iuu 1tt1. O? r utstAC LAW 99-335?JUNE 6, 1986
"? 8479. Exculpatory provisions; insurance
"(a) Any provision in an agreement or instrument which purports
to relieve a fiduciary from responsibility or liability for any respon-
sibility, obligation, or duty under this subchapter shall be void.
"(bX1) The Executive Director may require employing agencies to
contribute an amount not to exceed 1 percent of the amount such
agencies are required to contribute in accordance with section
8432(c) of this title to the Thrift Savings Fund.
"(2) The sums credited to the Thrift Savings Fund under para-
graph (1) shall be available and may be used at the discretion of the
Executive Director to purchase insurance to cover potential liability
of persons who serve in a fiduciary capacity with respect to the
Thrift Savings Fund, without regard to whether a policy of insur-
ance permits recourse by the insurer against the fiduciary in the
case of a breach of a fiduciary obligation.".
(b) CONFORMING AMENDMENT.?The table of chapters at the begin-
ning of part III of title 5, United States Code, is amended by
inserting after the item relating to chapter 83 the following new
item:
"84. Federal Employees' Retirement System 8401.".
TITLE II-OTHER AMENDMENTS TO TITLE
5 OF THE UNITED STATES CODE
SEC. 201. TREATMENT UNDER CIVIL SERVICE RETIREMENT SYSTEM OF
CERTAIN INDIVIDUALS EXCLUDED FROM FEDERAL EMPLOY-
EES' RETIREMENT SYSTEM.
(a) DEDUCTIONS, CONTRIBUTIONS, AND DEPOSITS.?(1) Section 8334
of title 5, United States Code, is amended by adding at the end
thereof the following:
"(kX1) Effective with respect to pay periods beginning after
December 31, 1986, in administering this section in the case of an
individual described in section 8402(b)(2) of this title?
"(A) the amount to be deducted and withheld by the employ-
ing agency shall be determined in accordance with paragraph
(2) of this subsection instead of the first sentence of subsection
(aX1) of this section; and
"(B) the amount of the contribution under the second sen-
tence of subsection (aX1) of this section shall be the amount
which would have been contributed under such sentence if this
subsection had not been enacted.
"(2XA) With respect to Federal wages of an employee or Member
(or that portion thereof) not exceeding the contribution and benefit
base during the calendar year involved, the appropriate amount to
be deducted and withheld under this subsection is the amount by
which?
"(i) the total deduction for those wages (or for that portion)
exceeds;
"(ii) the OASDI contribution with respect to those wages (or
that portion).
"(B) With respect to any portion of Federal wages of an employee
or Member which exceed the contribution and benefit base during
the calendar year involved, the appropriate amount to be deducted
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PUBLIC LAW 99-335?JUNE 6, 1986 100 STAT. 589
and withheld under this subsection is an amount equal to the total
deduction for that portion.
"(C) For purposes of this paragraph?
"(i) the term 'Federal wages' means basic pay for service as an
employee or Member, as the case may be;
'(ii) the term 'contribution and benefit base' means the con-
tribution and benefit base in effect with respect to the period
involved, as determined under section 230 of the Social Security
Act; 42 USC 430.
"(iii) the term 'total deduction', as used with respect to any
Federal wages (or portion thereof), means an amount equal to
the amount of those wages (or of that portion), multiplied by the
percentage which (but for this subsection) would apply under
the first sentence of subsection (a)(1) with respect to the individ-
ual involved; and
"(iv) the term `OASDI contribution', with respect to any
income, means the amount of tax which may be imposed under
section 3101(a) of the Internal Revenue Code of 1954 with 26 USC 3101.
respect to such income (determined without regard to any
income which is not a part of Federal wages).
"(3) The amount of a deposit under subsection (c) of this section for
any service with respect to which paragraph (1) of this subsection
applies shall be equal to an amount determined based on the
preceding provisions of this subsection, and shall include interest".
(2) Such section 8334 is further amended?
(A) in paragraphs (1) and (2) of subsection (e), by striking out
"or (j)" and inserting in lieu thereof "(j), or (kr;
(B) in subsection (0, by inserting "or (k)" after "subsection
(a)"; and
(C) in subsection (h), by striking out "and (j)" and inserting in
lieu thereof "(j), and (k)".
(b) OFFsrr IN BENEFITS.--(1) Subchapter III of chapter 83 of title 5,
United States Code, is amended by adding at the end thereof the 5 USC 8331.
following: Post, pp. 591-
593.
"? 8349. Offset relating to certain benefits under the Social 5 USC 8349.
Security Act 42 USC 1305.
"(aX1) Notwithstanding any other provision of this subchapter, if
an individual under section 8402(b)(2) is entitled, or would on proper
application be entitled, to old-age insurance benefits under title II of
the Social Security Act, the annuity otherwise payable to such 42 USC 401.
individual shall be reduced under this subsection.
"(2) A reduction under this subsection commences beginning with
the first month for which the individual both?
"(A) is entitled to an annuity under this subchapter; and
"(B) is entitled, or would on proper application be entitled, to
old-age insurance benefits under title II of the Social Security
Act.
"(3XA)(i) Subject to clause (ii) and subparagraphs (B) and (C), the
amount of a reduction under this subsection shall be equal to the
difference between?
"(I) the old-age insurance benefit which would be payable to
the individual for the month referred to in paragraph (2); and
"(II) the old-age insurance benefit which would be so payable,
excluding all wages derived from Federal service of the individ-
ual, and assuming the individual were fully insured (as defined
by section 214(a) of the Social Security Act). 42 USC 414.
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luu bTAT. OUU rursLie LAW 99-335?JUNE 6, 1986
42 USC 403.
42 USC 401.
Ante, pp. 286,
287.
"(ii) For purposes of this subsection, the amount of a benefit
referred to in subclause (I) or (II) of clause (i) shall be determined
without regard to subsections (b) through (1) of section 203 of the
Social Security Act, and without regard to the requirement that an
application for such benefit be filed.
"(B) A reduction under this subsection?
"(i) may not exceed an amount equal to the product of?
"(I) the old-age insurance benefit to which the individual
is entitled (or would on proper application be entitled) for
the month referred to in paragraph (2), determined without
regard to subsections (b) through (1) of section 203 of the
Social Security Act; and
"(II) a fraction, as determined under section 8421(bX3)
with respect to the individual, except that the reference to
'service' in subparagraph (A) of such section shall be consid-
ered to mean Federal service; and
"(ii) may not cause the annuity payment for an individual to
be reduced below zero.
"(C) An amount computed under subclause (I) or (II) of subpara-
graph (AXi), or under subparagraph (BXiXI), for purposes of deter-
mining the amount of a reduction under this subsection shall be
adjusted under section 8340 of this title.
"(4) A reduction under this subsection applies with respect to the
annuity otherwise payable to such individual under this subchapter
(other than under section 8337) for the month involved?
"(A) based on service of such individual; and
"(B) without regard to section 8345(j), if otherwise applicable.
"(5) The operation of the preceding paragraphs of this subsection
shall not be considered for purposes of applying the provisions of the
second sentence of section 215(aX7X8Xi) or the provisions of section
215(dX5Xii) of the Social Security Act in determining any amount
under subclause (I) or (II) of paragraph (3XAXi) or paragraph
(3XBXiXI) for purposes of this subsection.
"(bX1) Notwithstanding any other provision of this subchapter?
"(A) a disability annuity to which an individual described in
section 8402(b)(2) is entitled under this subchapter, and
"(B) a survivor annuity to which a person is entitled under
this subchapter based on the service of an individual described
in section 8402(b)(2),
shall be subject to reduction under this subsection if that individual
or person is also entitled (or would on proper application also be
entitled) to any similar benefits under title II of the Social Security
Act based on the wages and self-employment income of such individ-
ual described in section 8402(b)(2).
"(2XA) Subject to subparagraph (B), reductions under this subsec-
tion shall be made in a manner consistent with the manner in which
reductions under subsection (a) are computed and otherwise made.
"(B) Reductions under this subsection shall be discontinued if, or
for so long as, entitlement to the similar benefits under title II of the
Social Security Act (as referred to in paragraph (1)) is terminated
(or, in the case of an individual who has not made proper application
therefor, would be terminated).
"(3) For the purpose of applying section 224 of the Social Security
Act to the disability insurance benefit used to compute the reduction
under this subsection, the amount of the CSRS annuity considered
shall be the amount of the CSRS annuity before application of this
section.
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PUBLIC LAW 99-335?JUNE 6, 1986
100 STAT. 591
"(4) The Office shall prescribe regulations to carry out this
subsection.
"(c) For the purpose of this section, the term 'Federal service'
means service which is employment for the purposes of title II of the
Social Security Act and chapter 21 of the Internal Revenue Code of
1954 by reason of the amendments made by section 101 of the Social
Security Amendments of 1983.".
(2) The analysis for chapter 83 of title 5, United States Code, is
amended by adding at the end thereof the following new item:
"8349. Offset relating to certain benefits under the Social Security Act".
(C) CREDITABILITY OF INTERIM SERVICE.?Section 8334(c) of title 5,
United States Code, is amended by adding at the end thereof the
following: "Notwithstanding the preceding provisions of this subsec-
tion and any provision of section 206(bX3) of the Federal Employees'
Retirement Contribution Temporary Adjustment Act of 1983, the
percentage of basic pay required under this subsection in the case of
an individual described in section 8402(bX2) shall, with respect to
any covered service (as defined by section 203(aX3) of such Act)
performed by such individual after December 31, 1983, and before
January 1, 1987, be equal to 1.3 percent".
SEC. 202. NON-APPLICABILITY OF CIVIL SERVICE RETIREMENT SYSTEM
TO INDIVIDUALS UNDER FEDERAL EMPLOYEES' RETIREMENT
SYSTEM.
(a) EMPLOYEES.?Section 8331(1) of title 5, United States Code, is
amended?
(1) by amending clause (ii) to read as follows.:
"(ii) an employee subject to another retirement system for
Government employees (other than an employee described in
clause (x);";
(2) by striking "or" at the end of clause (viii);
(3) by striking the period at the end of clause (ix) and insert-
ing in lieu thereof "; or"; and
(4) by adding after clause (ix) the following:
"(x) an employee subject to the Federal Employees' Retire-
ment System.".
(b) MEMBERS OF CONGRESS.?Section 8331(2) of title 5, United
States Code, is amended by striking the semicolon and inserting in
lieu thereof ", but does not include any such Member of Congress
who is subject to the Federal Employees' Retirement System or who
makes an election under section 8401(20) of this title not to be
subject to such System;".
SEC. 203. PAY FOR THE EXECUTIVE DIRECTOR OF THE FEDERAL RETIRE-
MENT THRIFT INVESTMENT BOARD.
Section 5314 of title 5, United States Code, is amended by adding
at the end thereof the following:
"Executive Director, Federal Retirement Thrift Investment
Board.".
SEC. 204. ALTERNATIVE FORMS OF ANNUITIES.
(a) IN GENERAL.?Title 5, United States Code, is amended by
inserting after section 8343 the following:
"? 8343a. Alternative forms of annuities
"(a) The Office of Personnel Management shall prescribe regula-
tions under which an employee or Member may, at the time of
Regulations.
42 USC 401.
26 USC 3101
et seq.
26 USC 3121 and
3121 note;
42 USC 409-410
note.
5 USC 8331 note.
5 USC 8331 note.
Regulations.
5 USC 8343a.
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100 STAT. 592 PUBLIC LAW 99-335?JUNE 6, 1986
retiring under this subchapter (other than under section 8337 of this
title), elect annuity benefits under this section instead of any other
benefits under this subchapter (including any benefits under section
8341 of this title) based on the service of the employee or Member.
Regulations. "(b) Subject to subsection (c), the Office shall by regulation provide
for such alternative forms of annuities as the Office considers
appropriate, except that among the alternatives offered shall be?
"(1) an alternative which provides for?
"(A) payment of the lump-sum credit to the employee or
Member; and
"(B) payment of an annuity to the employee or Member
for life; and
"(2) in the case of an employee or Member who is married at
the time of retirement, an alternative which provides for?
"(A) payment of the lump-sum credit to the employee or
Member; and
"(B) payment of an annuity to the employee or Member
for life, with a survivor annuity payable for the life of a
surviving spouse.
"(c) Each alternative provided for under subsection (b) shall, to the
extent practicable, be designed such that the present value of the
benefits provided under such alternative (including any lump-sum
credit) is actuarially equivalent to the present value of the annuity
which would otherwise be provided the employee or Member under
this subchapter, as computed under subsections (a)-(i) and (n) of
section 8339 of this title.
"(d) An employee or Member who, at the time of retiring under
this subchapter?
"(1) is married, shall be ineligible to make an election under
this section unless a waiver is made under section 8339(j)(1) of
this title; or
"(2) has a former spouse, shall be ineligible to make an
election under this section if the former spouse is entitled to
benefits under section 8341(h) or 8345(j) of this title (based on
the service of the employee or Member) under the terms of a
decree of divorce or annulment, or a court order or court-
approved property settlement incident to any such decree, with
respect to which the Office has been duly notified.
"(e) An employee or Member who is married at the time of
retiring under this subchapter and who makes an election under
this section may, during the 18-month period beginning on the date
of retirement, make the election provided for under section 8339(o)
of this title, subject to the deposit requirement thereunder.".
(b) CONFORMING AMENDMENTS.?(1) The analysis for chapter 83 of
title 5, United States Code, is amended by inserting after the item
relating to section 8343 the following:
"8343a. Alternative forms of annuities.".
(2) The second sentence of section 8342(a) of title 5, United States
Code, is amended by striking "The" and inserting in lieu thereof
"Except as provided in section 8343a of this title, the".
SEC. 205. RETIREMENT COUNSELING.
(a) IN GENERAL.?Subchapter III of chapter 83 of title 5, United
States Code, as amended by section 201(b), is further amended by
adding at the end thereof the following:
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rutsmu LAW 99-335?JUNE 6, 1986 100 STAT. 593
"? 8350. Retirement counseling 5 USC 8350.
"(a) For the purposes of this section, the term 'retirement coun-
selor', when used with respect to an agency, means an employee of
the agency who is designated by the head of the agency to furnish
information on benefits under this subchapter and chapter 84 of this
title and counseling services relating to such benefits to other Ante, p. 517.
employees of the agency.
"(b) The Director of the Office of Personnel Management shall
establish a training program for all retirement counselors of agen-
cies of the Federal Government.
"(cX1) The training program established under subsection (bX1) of
this section shall provide for comprehensive training in the provi-
sions and administration of this subchapter and chapter 84 of this
title, shall be designed to promote fully informed retirement deci-
sions by employees and Members under this subchapter and individ-
uals subject to chapter 84 of this title, and shall be revised as
necessary to assure that the information furnished to retirement
counselors of agencies under the program is current.
"(2) The Director shall conduct a training session under the
training program at least once every 3 months.
"(3) Once each year, each retirement counselor of an agency shall
successfully complete a training session conducted under the train-
ing program.".
(h) CHAPTER ANALYSIS.?The chapter analysis at the beginning of
such chapter is amended by inserting after the item relating to
section 8349 the following:
"8350. Retirement counseling.".
SEC. 206. PARTICIPATION BY CERTAIN EMPLOYEES AND MEMBERS ONLY
IN THE THRIFT SAVINGS PLAN.
(aX1) Subchapter III of chapter 83 of title 5, United States Code (as
amended by sections 201(b) and 205(a) of this Act), is amended by
adding at the end thereof the following new section:
"0 8351. Participation in the Thrift Savings Plan 5 USC 8351.
"(aX1) An employee or Member may elect to contribute to the
Thrift Savings Fund established by section 8437 of this title.
"(2) An election may be made under paragraph (1) only during a
period provided under section 8432(b) for individuals who are subject
to chapter 84 of this title.
"(bX1) Except as otherwise provided in this subsection, the provi-
sions of subchapters III and VII of chapter 84 of this title shall apply
with respect to employees and Members making contributions to the
Thrift Savings Fund under subsection (a) of this section.
"(2) An employee or Member may contribute to the Thrift Savings
Fund in any pay period any amount not exceeding 5 percent of the
amount of the employee's or Member's basic pay for such period.
"(3) No contributions may be made by an employing agency for
the benefit of an employee or Member under section 8432(c) of this
title.
"(4) Section 8433(b) of this title applies to any employee or
Member who elects to make contributions to the Thrift Savings
Fund under subsection (a) of this section and separates from Govern-
ment employment entitled to an immediate annuity under this
subchapter (including a disability retirement annuity under section
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100 STAT. 594 PUBLIC LAW 99-335?JUNE 6, 1986
5 USC 8101.
Loans.
Securities.
Regulations.
5 USC 8351 note.
8337 of this title) or separates from Government employment enti-
tled to benefits under subchapter I of chapter 81 of this title.
"(5) Section 8433(c) of this title applies to any employee or
Member who elects to make contributions to the Thrift Savings
Fund under subsection (a) of this section and separates entitled to a
deferred annuity under this subchapter.
"(6) Section 8433(d) of this title applies to any employee or
Member who elects to make contributions to the Thrift Savings
Fund under subsection (a) of this section and separates from the
service before becoming entitled to an immediate or deferred annu-
ity under this subchapter.
"(7)(A) The provisions of section 8435 of this title that require a
waiver or consent by the spouse of an employee or Member (or
former employee or Member) shall not apply with respect to sums in
the Thrift Savings Fund contributed by the employee or Member (or
former employee or Member) and earnings in the fund attributable
to such sums.
"(B) An election, change of election, or modification (relating to
the commencement date of a deferred annuity) authorized by sub-
chapter III of chapter 84 of this title shall be effective in the case of
a married employee or Member, and a loan may be approved under
section 8433(i) of this title in such case, only after the Executive
Director notifies the employee's or Member's spouse that the elec-
tion, change of election, or modification has been made or that the
Executive Director has received an application for such loan, as the
case may be.
"(C) Subparagraph (B) may be waived with respect to a spouse or
former spouse if the employee or Member establishes to the satisfac-
tion of the Executive Director of the Federal Retirement Thrift
Investment Board that the whereabouts of such spouse or former
spouse cannot be determined.
"(8) Sums contributed under this section and earnings attrib-
utable to such sums may be invested and reinvested only in the
Government Securities Investment Fund established under section
8438(b)(1XA) of this title.
"(c) The Executive Director of the Federal Retirement Thrift
Investment Board may prescribe regulations to carry out this
section.".
(2) The analysis for chapter 83 of such title is amended by adding
at the end thereof the following:
"8351. Participation in the Thrift Savings Plan.".
(b) An election may first be made by an employee of the Federal
Government or a Member of Congress under section 8351 of title 5,
United States Code (as added by subsection (aX1)), during the first
period referred to in subsection (aX2) of such section which com-
mences on or after July 1, 1987.
SEC. 207. MISCELLANEOUS AMENDMENTS.
(a) AMENDMENT TO SECTION 2105.?Section 2105(cX2) of title 5,
United States Code, is amended by striking out "chapter 81" and
inserting in lieu thereof "chapter 81, chapter 84,".
(b) AMENDMENT TO SECTION 2109.?Section 2109(1) of title 5,
United States Code, is amended to read as follows:
"(1) 'air traffic controller' or 'controller' means a civilian
employee of the Department of Transportation or the Depart-
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r u 1.11-1W Uu?i?JUNE 6, 1986
100 STAT. 595
ment of Defense who, in an air traffic control facility or flight
service station facility?
"(A) is actively engaged?
"(i) in the separation and control of air traffic; or
"(ii) in providing preflight, inflight, or airport ad-
visory service to aircraft operators; or
"(B) is the immediate supervisor of any employee de-
scribed in subparagraph (A); and".
(c) AMENDMENT TO SECTION 6301.?Section 6301(2XB) of title 5, District of
United States Code, is amended to read as follows: Columbia.
"(B) an individual first employed by the government of
the District of Columbia before October 1, 1987;".
(d) AMENDMENT TO SECTION 6303.?The second sentence of section
6303(a) of title 5, United States Code, is amended by striking out
"title." and inserting in lieu thereof "title and all service creditable
under section 8411 of this title for the purpose of chapter 84 of this
title.". Ante, p. 517.
(e) AMENDMENT TO SECTION 8116.?Section 8116 of title 5, United
States Code, is amended by adding at the end thereof the following:
"(d) Notwithstanding the other provisions of this section, an
individual receiving benefits for disability or death under this sub-
chapter who is also receiving benefits under subchapter III of chap-
ter 84 of this title or benefits under title II of the Social Security Act 42 USC 401.
shall be entitled to all such benefits, except that?
"(1) benefits received under section 223 of the Social Security
Act (on account of disability) shall be subject to reduction on 42 USC 423.
account of benefits paid under this subchapter pursuant to the
provisions of section 224 of the Social Security Act; and 42 USC 424a.
"(2) in the case of benefits received on account of age or death
under title II of the Social Security Act, compensation payable
under this subchapter based on the Federal service of an em-
ployee shall be reduced by the amount of any such social
security benefits payable that are attributable to Federal serv-
ice of that employee covered by chapter 84 of this title. How-
ever, eligibility for or receipt of benefits under chapter 84 of this
title, or benefits under title II of the Social Security Act by
virtue of service covered by chapter 84 of this title, does not
affect the right of the employee to compensation for scheduled
disabilities specified by section 8107(c) of this title.".
(0 AMENDMENTS TO SEcrioN 8331.?Section 8331(1) of title 5,
United States Code, as amended by section 202(a), is further
amended?
(1) by amending subparagraph (G) to read as follows: District of
"(G) an individual first employed by the government of Columbia.
the District of Columbia before October 1, 1987;"; and
(2) by striking out "or" at the end of clause (ix), by striking
out the period at the end of clause (x) and inserting in lieu
thereof "; or", and by adding after clause (x) the following:
"(xi) an employee under the Botanic Garden excluded by
the Director or Acting Director of the Botanic Garden
under section 8347(1) of this title.".
(g) AMENDMENTS TO SECTION 8332.?(1) Section 8332(b) of title 5,
United States Code, is amended?
(A) by striking "and" at the end of paragraph (12), striking
the period at the end of the first paragraph (13) and inserting a
semicolon, redesignating the second paragraph (13) as para-
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iuu STAT. bUt) rutsLIC LAW 99-335?JUNE 6, 1986
District of
Columbia.
Guam.
Virgin Islands.
Ante, p. 517.
Records.
graph (14), and striking the period at the end of such paragraph
(14) (as so redesignated) and inserting "; and";
(B) by inserting after paragraph (14) (as so redesignated by
subparagraph (A)) the following:
"(15) subject to sections 8334(c) and 8339(i) of this title, service
performed on or after January 3, 1969, and before January 4,
1973, as the Washington Representative for Guam or the
Washington Representative for the Virgin Islands, only if the
individual serves as a Member for a period of at least five years
after January 2, 1973.";
(C) in the second sentence after paragraph (15) (as added by
subparagraph (B)), by striking "(13)" and inserting "(14)"; and
(D) by adding at the end thereof the following: "For the
purpose of this subchapter, service of the type described in
paragraph (15) of this subsection shall be considered Member
service.".
(2) The last sentence of section 8332(f) of title 5, United States
Code, is amended by striking "(13)" and inserting "(14)".
(3) The last sentence of section 8332(kX1) of title 5, United States
Code, is amended by striking "second" and inserting "third".
(h) AMENDMENTS TO SECTION 8342.?Section 8342(a) of title 5,
United States Code, is amended?
(1) in paragraphs (1XB) and (3), by inserting ", or chapter 84 of
this title," after "subchapter"; and
(2) by adding at the end the following: "In applying this
subsection with respect to an employee or Member who becomes
subject to chapter 84 of this title, entitlement to payment of the
lump-sum credit shall be determined without regard to para-
graph (1) or (3) if, and to the extent that, such lump-sum credit
relates to service of a type described in clauses (i) through (iii) of
section 302(aX1XC) of the Federal Employees' Retirement
System Act of 1986.".
(i) AMENDMENT TO SECTION 8347.?Section 8347 of title 5, United
States Code, is amended by adding at the end thereof the following:
"(nX1) Notwithstanding any other provision of this subchapter,
the Director of Central Intelligence shall, in a manner consistent
with the administration of this subchapter by the Office, and to the
extent considered appropriate by the Director of Central
Intelligence?
"(A) determine entitlement to benefits under this subchapter
based on the service of employees of the Central Intelligence
Agency;
"(B) maintain records relating to the service of such
employees;
"(C) compute benefits under this subchapter based on the
service of such employees;
"(D) collect deposits to the Fund made by such employees,
their spouses, and their former spouses;
"(E) authorize and direct disbursements from the Fund to the
extent based on service of such employees; and
"(F) perform such other functions under this subchapter as
the Director of Central Intelligence, in consultation with the
Director of the Office of Personnel Management, determines to
be appropriate.
"(2) The Director of the Office of Personnel Management shall
furnish such information and, on a reimbursable basis, such services
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PUBLIC LAW 99-335?JUNE 6, 1986 100 STAT. 597
to the Director of Central Intelligence as the Director of Central
Intelligence requests to carry out paragraph (1) of this subsection.
"(3XA) The Director of Central Intelligence, in consultation with Regulations.
the Director of the Office of Personnel Management, shall by regula-
tion prescribe appropriate procedures to carry out this subsection.
"(B) The regulations shall provide procedures for the Director of
the Office of Personnel Management to inspect and audit disburse-
ments from the Civil Service Retirement and Disability Fund under
this subchapter.
"(C) The Director of Central Intelligence shall submit the regula-
tions prescribed under subparagraph (A) to the Select Committee on
Intelligence of the Senate and the Permanent Select Committee on
Intelligence of the House of Representatives before the regulations
take effect.
"(4XA) Section 201(c) of the Central Intelligence Agency Retire-
ment Act of 1964 for Certain Employees shall apply in the adminis- 50 USC 403 note.
tration of this subchapter to the extent that the provisions of this
subchapter are administered under this subsection.
"(B) Notwithstanding subparagraph (A) of this paragraph, section
8347(d) of this title shall apply with respect to employees of the
Central Intelligence Agency who are subject to the Civil Service
Retirement System.".
(j) AMENDMENTS TO SECTION 8348.?Section 8348(a) of title 5,
United States Code, is amended?
(1) in paragraph (1XA), by striking out "subchapter;" and
inserting in lieu thereof "subchapter or by the provisions of
chapter 84 of this title which relate to benefits payable out of Ante, p. 517.
the Fund;";
(2) in paragraph (1XB)?
(A) by inserting "or 8462" after "8340"; and
(B) by striking out "title, and" and inserting in lieu
thereof "title or subchapters II and IV of chapter 84 of this
title, and"; and
(3) in paragraph (2), by striking out "chapter" and inserting in
lieu thereof "chapter, chapter 84 of this title,".
(k) AMENDMENTS TO CHAPTER 87.?Chapter 87 of title 5, United 5 USC 8701
States Code, is amended? et seq.
(1) by amending section 8701(aX6) to read as follows:
"(6) an individual first employed by the government of the
District of Columbia before October 1, 1987;";
(2) in section 8706, by striking out subsection (c) and
redesignating subsections (d), (e), and (0 as subsections (c), (d),
and (e), respectively;
(3) by striking out subsection (cX1) of section 8714a and insert-
ing in lieu thereof the following:
"(c)(1) Except as otherwise provided in this subsection, the op- Insurance.
tional insurance on an employee stops on his separation from
service or 12 months after discontinuance of his pay, whichever is
earlier, subject to a provision for temporary extension of life insur-
ance coverage and for conversion to an individual policy of life
insurance under conditions approved by the Office.";
(4) by striking out the first sentence of section 8714b(cX1) and
inserting in lieu thereof the following: "Except as otherwise
provided in this subsection, the additional optional insurance
elected by an employee pursuant to this section shall stop on
separation from service or 12 months after discontinuance of his
pay, whichever is earlier, subject to a provision for temporary
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100 STAT. 598 PUBLIC LAW 99-335?JUNE 6, 1986
District of
Columbia.
Ante, pp. 589,
591-593.
Ante, p. 517.
extension of life insurance coverage and for conversion to an
individual policy of life insurance under conditions approved by
the Office."; and
(5) by striking out subsection (cX1) of section 8714c and insert-
ing in lieu thereof the following:
"(cX1) Except as otherwise provided in this subsection, the op-
tional life insurance on family members shall stop at the earlier of
the employee's death, the employee's separation from the service, or
12 months after discontinuance of pay, subject to a provision for
temporary extension of life insurance coverage and for conversion to
individual policies of life insurance under conditions approved by
the Office.".
(1) AMENDMENTS TO SECTION 8901.?Section 8901 of title 5, United
States Code, is amended?
(1) by amending paragraph (1XE) to read as follows:
"(E) an individual first employed by the government of
the District of Columbia before October 1, 1987;";
(2) by amending paragraph (3XA) to read as follows:
"(A) an employee who retires?
"(i) on an immediate annuity under subchapter III of
chapter 83 of this title, or another retirement system
for employees of the Government, after 5 or more years
of service;
"(ii) under section 8412 or 8414 of this title; or
"(iii) for disability under subchapter III of chapter 83
of this title, chapter 84 of this title, or another retire-
ment system for employees of the Government;";
(3) in paragraph (4), by inserting "or chapter 84" after "83";
(4) in paragraph (10XCXi), by inserting "or 8467" after
"8345(j)", by inserting "or 8445" after "8341(h)", and by striking
out "System)," and inserting in lieu thereof "System or the
Federal Employees' Retirement System),"; and
(5) in paragraph (10XCXii)?
(A) by striking out "or 8345(j)" and inserting in lieu
thereof "8345(j), 8445, or 8467" and by striking out
"System)" and inserting in lieu thereof "System or the
Federal Employees' Retirement System)"; and
(B) by inserting "or 8417(b)" after "8339(jX3)".
(m) AMENDMENTS TO SECTION 8905.?Section 8905(cX1) of title 5,
United States Code, is amended?
(1) in subparagraph (B), by inserting "or 8417(b)" after
"8339(jX3)"; and
(2) in the second sentence, by striking out "or 8345(j)" and
inserting in lieu thereof "8345(j), 8445, or 8467".
(n) AMENDMENT TO SECTION 5102.?Section 5102(cX14) of title 5,
United States Code, is amended by inserting "(other than employees
of the Federal Retirement Thrift Investment Management System
appointed under section 8474(cX2) of this title)" after "United
States".
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PUBLIC; LAW 99-335?JUNE 6, 1986 100 STAT. 599
TITLE III OTHER PROVISIONS RELATING
TO THE FEDERAL EMPLOYEES' RE-
TIREMENT SYSTEM AND THE CIVIL
SERVICE RETIREMENT SYSTEM
SEC. 301. ELECTIONS. 5 USC 8331 note.
(a) ELECTIONS FOR INDIVIDUALS SUBJECT TO THE CIVIL SERVICE
RETIREMENT SYSTEM.?(1XA) Any individual (other than an individ-
ual under subsection (b)) who, as of June 30, 1987, is employed by the
Federal Government, and who is then subject to subchapter III of
chapter 83 of title 5, United States Code, may elect to become subject Ante, pp. 589,
to chapter 84 of such title. 591-593.
(B) An election under this paragraph may not be made before Ante, p. 517.
July 1, 1987, or after December 31, 1987.
(2)(A) Any individual who, after June 30, 1987, becomes re-
employed by the Federal Government, and who is then subject to
subchapter III of chapter 83 of title 5, United States Code, may elect
to become subject to chapter 84 of such title.
(B) An election under this paragraph shall not be effective unless
it is made during the six-month period beginning on the date on
which reemployment commences.
(b) ELECTIONS FOR CERTAIN INDIVIDUALS SERVING CONTINUOUSLY
SINCE DECEMBER 31, 1983.?The following rules shall apply in the
case of any individual described in section 8402(bX1) of title 5,
United States Code:
(1) If, as of December 31, 1986, the individual is subject to
subchapter III of chapter 83 of title 5, United States Code, but is
not subject to section 204 of the Federal Employees' Retirement
Contribution Temporary Adjustment Act of 1983, the individual 5 USC 8331 note.
shall remain so subject to such subchapter unless the individual
elects, after June 30, 1987, and before January 1, 1988?
(A) to become subject to such subchapter under the same
terms and conditions as apply in the case of an individual
described in section 8402(bX2) of such title who is subject to
such subchapter; or
(B) to become subject to chapter 84 of such title.
An individual eligible to make an election under this paragraph
may make the election described in subparagraph (A) or (B), but
not both.
(2) If, as of December 31, 1986, the individual is subject to
subchapter III of chapter 83 of title 5, United States Code, and is
also subject to section 204 of the Federal Employees' Retirement
Contribution Temporary Adjustment Act of 1983, the
individual?
(A) shall, as of January 1, 1987, become subject to such
subchapter under the same terms and conditions as apply
in the case of an individual described in section 8402(bX2) of
such title who is subject to such subchapter; and
(B) may (during the six-month period described in subsec-
tion (aX1XB)) elect to become subject to chapter 84 of such
title.
(3XAXi) If, as of December 31, 1986, the individual is not
subject to subchapter III of chapter 83 of title 5, United States
Code, the individual may, during the six-month period described
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100 STAT. 600 PUBLIC LAW 99-335?JUNE 6, 1986
Ante, p. 591.
Ante, pp. 589,
591-593.
Ante, p. 517.
in subsection (aX1XB), and if such individual has not since
become subject to such subchapter pursuant to notification
under section 8331(2) of such title, elect to become subject to
chapter 84 of such title.
(ii) An individual who makes an election under this subpara-
graph ceases to be eligible to become subject to subchapter III of
chapter 83 of title 5, United States Code, pursuant to notifica-
tion under section 8331(2) of such title.
(B) Except as provided in subparagraph (AXii), nothing in this
paragraph shall preclude an individual from becoming subject
to subchapter III of chapter 83 of title 5, United States Code,
pursuant to notification under section 8331(2) of such title.
However, an individual who becomes subject to such subchapter
pursuant to notification under such section 8331(2) after Decem-
ber 31, 1986, shall become subject to such subchapter under the
same terms and conditions as apply in the case of an individual
described in section 8402(b)(2) of such title who is subject to such
subchapter.
(C) EFFECTIVE DATE; IRREVOCABILITY.?An election made under this
section?
(1) shall take effect beginning with the first pay period begin-
ning after the date of the election; and
(2) shall be irrevocable.
(d) CONDITION FOR MAKING AN ELECTION; EXTENSION To SATISFY
CONDM0N.?(1) An election under this section to become subject to
chapter 84 of title 5, United States Code, shall not be considered
effective in the case of an individual having one or more former
spouses, unless the election is made with the written consent of such
former spouse (or each such former spouse, if there is more than
one).
(2XA) This subsection applies with respect to a former spouse who
(based on the service of the individual involved) is entitled to
benefits under section 8341(h) or 8345(j) of title 5, United States
Code, under the terms of a decree of divorce or annulment, or a
court order or court-approved property settlement incident to any
such decree, with respect to which the Office of Personnel Manage-
ment has been duly notified.
(B) This subsection does not apply with respect to a former spouse
who has ceased to be so entitled as a result of remarrying before age
55.
(3) The requirement under paragraph (1) shall be considered
satisfied with respect to a former spouse if the individual seeking to
make the election establishes to the satisfaction of the Office (in
accordance with regulations prescribed by the Office)?
(A) that the former spouse's whereabouts cannot be deter-
mined; or
(B) that, due to exceptional circumstances, requiring the
individual to seek the former spouse's consent would otherwise
be inappropriate.
(4XA) The Office shall, upon application of an individual, grant an
extension for such individual to make an election referred to in
paragraph (1) if such individual?
(i) files application for extension before the end of the period
during which such individual would otherwise be eligible to
make such election; and
(ii) demonstrates to the satisfaction of the Office that the
extension is needed to secure the modification of a decree of
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PUBLIC LAW 99-335?JUNE 6, 1986 100 STAT. 601
divorce or annulment (or a court order or court-approved prop-
erty settlement incident to any such decree) in order to satisfy
the consent requirement under paragraph (1).
(B) An extension under this paragraph shall be for 6 months or for
such longer period as the Office considers appropriate.
(e) EXCLUSIONS.?This section does not apply to an individual
under section 8331(1XG) of title 5, United States Code. Ante, p. 595.
SEC. 302. EFFECT OF AN ELECTION UNDER SECTION 301 TO BECOME SUB- 5 USC 8331 note.
JECT TO THE FEDERAL EMPLOYEES' RETIREMENT SYSTEM.
(a) GENERAL AND SPECIAL RULFS.?All provisions of chapter 84 of
title 5, United States Code (including those relating to disability Ante, p. 517.
benefits, survivor benefits, and any reductions to provide for survi-
vor benefits) shall apply with respect to any individual who becomes
subject to such chapter pursuant to an election under section 301,
except if, or to the extent that, such provisions are inconsistent with
the following:
(1XA) Any civilian service which is performed before the
effective date of the election under section 301 shall not be
creditable under chapter 84 of title 5, United States Code,
except as otherwise provided in this subsection.
(B) Any service described in subparagraph (A) which is cov-
ered service within the meaning of section 203(aX3) of the
Federal Employees' Retirement Contribution Temporary
Adjustment Act of 1983 (97 Stat. 1107; 5 U.S.C. 8331 note)
(hereinafter in this section referred to as "covered service")
shall be creditable under chapter 84 of title 5, United States
Code, if?
(i) with respect to any such service performed before
January 1, 1987, 1.3 percent of basic pay for such service
was withheld in accordance with such Act or, if either such
withholding was not made or was made, but the amount so
withheld was subsequently refunded, 1.3 percent of basic
pay for such period is deposited to the credit of the Civil
Service Retirement and Disability Fund (hereinafter in this
section referred to as the "Fund"), with interest (computed
under section 8334(e) of such title); and
(ii) with respect to any such service performed after
December 31, 1986, and before the effective date of the
election, an amount equal to the percentage of basic pay for
such service which would be required to be withheld under
section 8422(a) of title 5, United States Code, has been
contributed to the Fund by the individual involved,
whether by withholdings from pay or, if either no withhold-
ing was made or was made, but the amount withheld was
subsequently refunded, the aforementioned percentage of
basic pay for such period is deposited to the credit of the
Fund, with interest (computed under section 8334(e) of such
title).
(C) Any service described in subparagraph (A)?
(i) which is not covered service;
(ii) which constitutes service of a type described in section
8411(b)(3) of title 5, United States Code (determined without
regard to whether such service was performed before, on, or
after January 1, 1989, and without regard to the provisions
of section 8411(f) of such title); and
(iii) which, in the aggregate, is equal to less than 5 years;
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100 STAT. 602 PUBLIC LAW 99-335?JUNE 6, 1986
Ante, p. 517.
Ante, pp. 589,
591-593.
shall be creditable under chapter 84 of such title, subject to
section 8411(f) of such title.
(D) Any service described in subparagraph (A)?
(i) which is not covered service;
(ii) which constitutes service of a type described in section
8411(bX3) of title 5, United States Code (determined without
regard to whether such service was performed before, on, or
after January 1, 1989, and without regard to the provisions
of section 8411(0 of such title); and
(iii) which, in the aggregate, is equal to 5 years or more;
shall be creditable for purposes of?
(I) section 8410 of such title, relating to the minimum
period of civilian service required to be eligible for an
annuity;
(II) any provision of section 8412 (other than subsection
(d) or (e) thereof), 8413, 8414, 8442(bX1XB), or 8451 of such
title which relates to a minimum period of service for
entitlement to an annuity;
(III) the provisions of paragraphs (4) and (6);
(IV) any provision of section 8412(d) of such title which
relates to a minimum period of service for entitlement to an
annuity, but only if and to the extent that the service
described in subparagraph (A) was as a law enforcement
officer or firefighter; and
(V) any provision of section 8412(e) of such title which
relates to a minimum period of service for entitlement to an
annuity, but only if and to the extent that the service
described in subparagraph (A) was as an air traffic
controller.
(2XA) Except as provided in subparagraph (B), the creditabil-
ity under chapter 84 of title 5, United States Code, of any
military service which is performed before the effective date of
the election under section 301 shall be determined in accord-
ance with applicable provisions of such chapter.
(B) If the electing individual has performed service described
in clauses (i) through (Hi) of paragraph (1XD), service described
in subparagraph (A) which, but for the provisions of subsection
(b), would be creditable under subchapter III of chapter 83 of
title 5, United States Code, as in effect on December 31, 1986,
shall be creditable for purposes of?
(i) any provision of section 8412 (other than subsection (d)
or (e) thereof), 8413, or 8414 of such title which relates to a
minimum period of service for entitlement to an annuity;
and
(ii) the provisions of paragraph (4).
(3XAX0 If the electing individual becomes entitled to an annu-
ity under subchapter II of chapter 84 of title 5, United States
Code, or dies leaving a survivor or survivors entitled to benefits
under subchapter IV of such chapter, the annuity for such
individual shall be equal to the sum of the individual's accrued
benefits under the Civil Service Retirement System (as
determined under paragraph (4)) and the individual's accrued
benefits under the Federal Employees' Retirement System (as
determined under paragraph (5)).
(ii) An annuity computed under this subparagraph shall be
deemed to be the individual's annuity computed under section
8415 of title 5, United States Code.
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r u tuAu LH. VV UV-600?d ONE 6, 1986 100 STAT. 603
(B) If the electing individual becomes entitled to an annuity
under subchapter V of chapter 84 of title 5, United States Code,
and if it becomes necessary to compute an annuity under
section 8415 of such title with respect to such individual as a
result of such individual's having become so entitled, the meth-
odology set forth in subparagraph (A) shall be used in comput-
ing any such annuity under section 8415.
(4) Except as provided in paragraph (12XB), accrued benefits
under this paragraph shall be computed in accordance with
applicable provisions of subchapter III of chapter 83 of title 5,
United States Code (but without regard to subsection (j) or (k),
? or the second sentence of subsection (e), of section 8339 of such
title) using only any civilian service under paragraph (1XD), and
any military service under paragraph (2XB), which would be
creditable for purposes of computing an annuity under such
subchapter.
(5) Accrued benefits under this paragraph shall be computed
under section 8415 of title 5, United States Code, using?
(A) total service creditable under chapter 84 of such title
which is performed on or after the effective date of the
election under section 301; and
(B) with respect to service performed before such effective
date?
(i) creditable civilian service (as determined under
applicable provisions of this subsection) other than any
service described in paragraph (1XD); and
(ii) creditable military service (as determined under
applicable provisions of this subsection) other than any
service described in paragraph (2XB).
(6XA) For purposes of any computation under paragraph (4) or
(5), the average pay to be used shall be the largest annual rate
resulting from averaging the individual's rates of basic pay in
effect over any 3 consecutive years of creditable service or, in
the case of an annuity based on service of less than 3 years, over
the total period of service so creditable, with each rate weighted
by the period it was in effect.
(B) For purposes of subparagraph (A), service shall be consid-
ered creditable if it would be considered creditable for purposes
of determining average pay under chapter 83 or 84 of title 5,
United States Code.
(7) The cost-of-living adjustments for the annuity of the elect-
ing individual shall be made as follows:
(A) The portion of the annuity attributable to paragraph
(4) shall be adjusted at the time and in the amount provided
for under section 8340 of title 5, United States Code.
(B) The portion of the annuity attributable to paragraph
(5) shall be adjusted at the time and in the amount provided
for under section 8462 of title 5, United States Code.
(8) For purposes of any computation under paragraph (4) in
the case of an individual who retires under section 8412 or 8414
of title 5, United States Code, or who dies leaving a survivor or
survivors entitled to benefits under subchapter IV of such
chapter, sick leave creditable under section 8339(m) of such title
shall be equal to the number of days of unused sick leave to the
individual's credit as of the date of retirement or as of the
effective date of the individual's election under section 301,
whichever is less.
Ante, pp. 589,
591-593.
Ante, p. 517.
5 USC 8301
et seq.
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ivy oitti. Dug r u tsLIC LAW 99-335?JUNE 6, 1986
Ante, pp. 589,
591-593.
Ante, p. 517.
(9) In computing the annuity under paragraph (3) for an
individual retiring under section 8412(g) or 8413(b) of title 5,
United States Code, the reduction under section 8415(0 of such
title shall apply with respect to the sum computed under such
paragraph.
(10) An annuity supplement under section 8421 of title 5,
United States Code, shall be computed using the same service as
is used for the computation under paragraph (5).
(11) Effective from its commencing date, an annuity payable
to an annuitant's survivor (other than a child under section
8443 of title 5, United States Code) shall be increased by the
total percent by which the deceased annuitant's annuity was
increased under paragraph (7).
(12XA) If the electing individual is subject to section 8344 of
title 5, United States Code, at the time of making the election,
payment of annuity benefits otherwise payable to such individ-
ual under subchapter III of chapter 83 of such title (and any
related deductions from pay) shall terminate as of the effective
date of the election.
(B) Accrued benefits under paragraph (4) for an individual
described in subparagraph (A) shall be computed?
(i) in accordance with applicable provisions of subchapter
III of chapter 83 of title 5, United States Code (but without
regard to subsection (j) or (k), or the second sentence of
subsection (e), of section 8339 of such title) using only any
civilian service under paragraph (1XD), and any military
service under paragraph (2XB), which would be creditable
for purposes of computing an annuity under such sub-
chapter; and
(ii) as if the individual's reemployment terminated on the
effective date of the election.
(b) CHAPTER 83 GENERALLY INAPPLICABLE.?(1) Except as provided
in subsection (a) or paragraph (2), subchapter III of chapter 83 of
title 5, United States Code, shall not apply with respect to any
individual who becomes subject to chapter 84 of title 5, United
States Code, pursuant to an election under section 301.
(2XA) Nothing in paragraph (1), or in subchapter III of chapter 83
of title 5, United States Code, shall preclude the making of a
deposit under such subchapter with respect to any civilian service
under subsection (aX1XD) or military service under subsection
(aX2XB) either by the electing individual or, for purposes of survivor
annuities, by a survivor of such individual.
(B) Nothing in paragraph (1) shall preclude the payment of any
lump-sum credit in accordance with section 8342 of title 5, United
States Code.
(c) REFUNDS RELATING TO CERTAIN CIVILIAN SERVICE.?(1) Any
individual who makes an election under section 301 to become
subject to chapter 84 and who, with respect to any period before the
effective date of the election, has made a contribution to the Civil
Service Retirement System (whether by deductions from pay or by a
deposit or redeposit) and has not taken a refund of the contribution
(as so made), shall be entitled to a refund equal to?
(A) for a period of service under clause (i) of subsection
(aX1XB), the amount by which?
(i) the amount contributed with respect to such period,
exceeds
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PUBLIC LAW 99-335?JUNE 6, 1986 100 STAT. 605
(ii) the amount required under such clause (i) with respect
to such period;
(B) for a period of service under clause (ii) of subsection
(aX1XB), the amount by which?
(i) the amount so contributed with respect to such period,
exceeds
(ii) the amount required under such clause (ii) with re-
spect to such period; and
(C) for a period of service under subparagraph (C) of subsec-
tion (aX1), the amount by which?
(i) the amount so contributed with respect to such period,
exceeds
(ii) the amount required under such subparagraph with
respect to such period.
(2) A refund under this subsection?
(A) shall be payable with interest, computed at the rate
applicable for the period involved under section 8331(8XC) of
title 5, United States Code, but only if such interest would be
payable pursuant to an application for a lump-sum credit appro-
priately filed under subchapter III of chapter 83 of such title;
and
(B) shall be payable upon written application therefor filed
with the Office of Personnel Management.
SEC. 303. PROVISIONS RELATING TO AN ELECTION TO BECOME SUBJECT 5 USC 8331 note.
TO CHAPTER 83 SUBJECT TO CERTAIN OFFSETS RELATING TO
SOCIAL SECURITY.
(a) REFUND.?Any individual who makes an election under section
301(bX1XA) shall, upon written application to the Office of Personnel
Management, be entitled to a refund equal to?
(1) for the period beginning on January 1, 1984, and ending on
December 31, 1986, the amount by which?
(A) the total amount deducted from such individual's
basic pay under section 8334(aX1) of title 5, United States
Code, for such period, exceeds
(B) 1.3 percent of such individual's total basic pay for
such period; and
(2) for the period beginning on January 1, 1987, and ending on
the day before the effective date of the election, the amount by
which?
(A) the total amount deducted from such individual's
basic pay under such section 8334(aX1) for such period,
exceeds
(B) the total amount which would have been deducted if
such individual's basic pay had instead been subject to
section 8334(k) of such title during such period.
(b) DEPOSIT REQUIREMENTS.?(1) In the case of an individual who
becomes subject to subchapter III of chapter 83 of title 5, United
States Code, pursuant to notification as described in the second
sentence of section 301(bX3XB), service performed by such individual
before the effective date of the notification shall not be considered
creditable under such subchapter unless?
(A) for any service during the period beginning on January 1,
1987, and ending on the day before such effective date, there is
deposited to the credit of the Fund a percentage of basic pay for
such period equal to the percentage which would have applied
Ante, pp. 589,
591-593.
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100 STAT. 606 PUBLIC LAW 99-335?JUNE 6, 1986
under section 8334(k) of such title if such individual's pay had
been subject to such section during such period;
(B) for any period of service beginning on January 1, 1984,
and ending on December 31, 1986, there is deposited to the
credit of the Fund an amount equal to 1.3 percent of basic pay
for such period; and
(C) for any period of service before January 1, 1984, there is
deposited to the credit of the Fund any amount required with
respect to such period under such subchapter.
(2) A deposit under this subsection may be made by the individual
or, for purposes of survivor annuities, a survivor of such individual.
SEC. 304. AMENDMENTS RELATING TO SOCIAL SECURITY.
(a) AMENDMENTS TO SOCIAL SECURITY ACT.?Section 210(SX5) Of the
42 USC 410. Social Security Act is amended?
(1) by striking out "or" at the end of subparagraph (F);
(2) by striking out the semicolon at the end of subparagraph
(G) and inserting in lieu thereof ", or"; and
(3) by adding at the end thereof the following:
"(H) service performed by an individual on or after the
effective date of an election by such individual under sec-
tion 301(a) of the Federal Employees' Retirement System
Act of 1986, or under regulations issued under section 860 of
Post, p. 619. the Foreign Service Act of 1980 or section 307 of the Central
Intelligence Agency Retirement Act of 1964 for Certain
Post, p. 628. Employees, to become subject to chapter 84 of title 5,
Ante, p. 517. United States Code;".
(b) AMENDMENTS TO THE INTERNAL REVENUE CODE OF 1954.-
26 USC 3121. Section 3121(bX5) of the Internal Revenue Code of 1954 is amended?
(1) by striking out "or" at the end of subparagraph (F);
(2) by striking out the semicolon at the end of subparagraph
(G) and inserting in lieu thereof ", or"; and
(3) by adding at the end thereof the following:
"(H) service performed by an individual on or after the
effective date of an election by such individual under sec-
tion 301(a) of the Federal Employees' Retirement System
Act of 1986, or under regulations issued under section 860 of
the Foreign Service Act of 1980 or section 307 of the Central
Intelligence Agency Retirement Act of 1964 for Certain
Employees, to become subject to chapter 84 of title 5,
United States Code;".
SEC. 305. EXTENSION OF FEDERAL EMPLOYEES' RETIREMENT CON-
TRIBUTION TEMPORARY ADJUSTMENT ACT OF 1983; REFUND
OF EXCESS CONTRIBUTIONS.
(a) EXTENSION.?The Federal Employees' Retirement Contribution
Temporary Adjustment Act of 1983 (97 Stat. 1106; 5 U.S.C. 8331
note) is amended?
(1) in sections 202(6), 203(aX4XA), 203(aX4XB), 204(a), and
206(bX2XAXi) by striking "May 1, 1986" each place it appears
and inserting by
1, 1987", and in sections 202(1) and
206(cX3) by striking "January 1, 1986" and inserting "Janu-
ary 1, 1987"; and
(2) in subsections (b) and (c) of section 205, by striking out
"and 1986" and inserting in lieu thereof "1986, and 1987".
(h) REFUNDS.?(1) The amendments made by subsection (a) shall be
effective as of May 1, 1986.
Effective date.
5 USC 8331 note.
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PUBLIC LAW 99-330?JUNE 6, 1986 100 STAT. 607
(2) Any refund payable to an individual as a result of paragraph
(1) shall be paid out of funds of the appropriate retirement system.
(3) For purposes of this subsection, the term "retirement system"
means a covered retirement system as defined by section 203(aX2) of
the Federal Employees' Retirement Contribution Temporary Adjust-
ment Act of 1983 (97 Stat. 1107; 5 U.S.C. 8331 note).
SEC. 306. APPLICABILITY TO THE UNITED STATES POSTAL SERVICE.
Section 1005(d) of title 39, United States Code, is amended to read
as follows:
"(d) Officers and employees of the Postal Service (other than the
Governors) shall be covered by chapters 83 and 84 of title 5. The
Postal Service shall withhold from pay and shall pay into the Civil
Service Retirement and Disability Fund the amounts specified in or
determined under such chapter 83 and subchapter II of such chapter
84, respectively. The Postal Service shall pay into the Federal
Retirement Thrift Savings Fund the amounts specified in or deter-
mined under subchapters III and VII of such chapter 84.".
SEC. 307. USE OF "NORMAL-COST PERCENTAGE".
Notwithstanding any other provision of law, the normal-cost
percentage (as defmed by section 8401(23) of title 5, United States
Code, as added by this Act) of the Federal Employees' Retirement
System shall be used to value the cost of the System for all purposes
in which the cost of the System is required to be determined by the
Federal Government, including any comparisons between the cost of
performing commercial activities under contract with commercial
sources and the cost of performing those activities using Govern-
ment facilities and personnel.
SEC. 308. RETIREMENT STUDY.
(a) STUDY AND PLAN.?The Secretary of Defense and Secretary of
Transportation shall conduct a study of the retirement systems
provided for employees of nonappropriated fund instrumentalities of
the United States under their respective jurisdictions and shall
develop a feasible plan or plans to provide portability of vested
retirement benefits among such retirement systems and other Fed-
eral Government retirement systems.
(b) REPORT.?Not later than 90 days after the date of enactment of
this Act, the Secretary of Defense and Secretary of Transportation
shall transmit a report to the Congress describing the plan or plans
developed pursuant to subsection (a) and the anticipated schedule
for the implementation of such plan or plans.
SEC. 309. REPEAL OF AUTOMATIC TRANSFER PROVISION.
Section 207 of the Federal Employees' Retirement Contribution
Temporary Adjustment Act of 1983 (97 Stat. 1111; 5 U.S.C. 8331
note) is repealed.
SEC. 310. DISCLOSURE OF RETURN INFORMATION.
(a) IN GENERAL.?Subsection (1) of section 6103 of the Internal
Revenue Code of 1954 (relating to disclosure of returns and return 26 USC 6103
information for purposes other than tax administration) is amended
by adding at the end thereof the following new paragraph:
"(12) DISCLOSURE OF RETURN INFORMATION TO CARRY OUT FED-
ERAL EMPLOYEES' RETIREMENT SYSTEM.?
"(A) IN GENERAL.?The Commissioner of Social Security
shall, on written request, disclose to the Office of Personnel
5 USC 8301
et seq.; ante,
p. 517.
5 USC 8401 note.
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ivy 11-11 . uuo r u ncuiu LAW 99-335?JUNE 6, 1986
26 USC 1402,
3121, 3401.
5 USC 8301
et seq.; ante,
p. 517.
26 USC 6103.
26 USC 6103
note.
42 USC 1306.
Management return information from returns with respect
to net earnings from self-employment (as defined in section
1402), wages (as defined in section 3121(a) or 3401(a)), and
payments of retirement income, which have been disclosed
to the Social Security Administration as provided by para-
graph (1) or (5).
"(B) RESTRICTION ON DISCLOSURE.?The Commissioner of
Social Security shall disclose return information under
subparagraph (A) only for purposes of, and to the extent
necessary in, the administration of chapters 83 and 84 of
title 5, United States Code."
(b) CONFORMING AMENDMENTS.?
(1) Subparagraph (A) of section 6103(pX3) of such Code is
amended by striking out "(10), or (11)" and inserting in lieu
thereof "(10), (11), or (12)".
(2) Paragraph (4) of section 6103(p) of such Code is amended?
(A) by striking out "(10), or (11)" in the material preced-
ing subparagraph (A) and inserting in lieu thereof "(10),
(11), or (12)", and
(B) by striking out "(10), or (11)" in subparagraph (FXii)
and inserting in lieu thereof "(10), (11), or (12)".
(C) REIMBURSEMENT.?The Office of Personnel Management shall
reimburse the costs (as determined by the Secretary of Health and
Human Services) of supplying?
(1) information under section 6103(1X12) of the Internal Reve-
nue Code of 1954; and
(2) such other information agreed upon by the Director of the
Office of Personnel Management and the Secretary of Health
and Human Services, which is required in the administration of
chapters 83 and 84 of title 5, United States Code.
Section 1106 (b) and (c) of the Social Security Act shall apply to any
reimbursement under this subsection.
5 USC 8472 note. SEC. 311. INITIAL APPOINTMENTS TO THE FEDERAL RETIREMENT THRIFT
INVESTMENT BOARD.
(a) INITIAL APPOINTMENT OF MEMBERS.?Section 8472(c) of title 5,
United States Code (as added by section 101(a) of this Act) shall not
apply to the members of the Federal Retirement Thrift Investment
Board first appointed to such Board.
(b) TERMS OF SERVICE.?Notwithstanding subsection (eX1) of sec-
tion 8472 of title 5, United States Code (as added by section 101(a) of
this Act), the term of service of each member of the Federal Retire-
ment Thrift Investment Board appointed pursuant to subsection (a)
shall be 1 year, except that such member shall continue to serve
until his successor is appointed under subsection (b) of such section
8472 and confirmed under subsection (c) of such section.
5 USC 8432 note. SEC. 312. PLAN FOR DELAYED CONTRIBUTIONS TO THE THRIFT SAVINGS
FUND.
Not later than January 1, 1988, the Executive Director of the
Federal Retirement Thrift Investment Board shall transmit to Con-
gress a plan to afford employees of the Federal Government and
Members of Congress who make less than the maximum amount of
authorized contributions to the Thrift Savings Fund in any period
an opportunity to contribute to such Fund, in a later period, the
excess of such amount over the amount contributed during such
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PUBLIC LAW 99-335?JUNE 6, 1986
100 STAT. 609
period. The plan shall include such recommendations for legislation
as the Executive Director considers appropriate.
TITLE IV FOREIGN SERVICE
RETIREMENT
SEC. 401. SHORT TITLE; REFERENCES TO FOREIGN SERVICE ACT OF 1980.
(a) SHORT Timm?This title may be cited as the "Foreign Service
Pension System Act of 1986".
(b) AMENDMENTS TO FOREIGN SERVICE ACT OF 1980.?Whenever in
this title a section or other provision is amended, such amendment
shall be considered to be made to that section or other provision of
the Foreign Service Act of 1980 (22 U.S.C. 3901 et seq.).
SEC. 402. REDESIGNATION OF CERTAIN PROVISIONS OF THE FOREIGN
SERVICE ACT OF 1980.
(a) CONFORMING CHAPTER AMENDMENTS.?Chapter 8 of title I (22
U.S.C. 4041 et seq.) is amended?
(1) by striking out the caption of such chapter and inserting in
lieu thereof the following:
"CHAPTER 8?FOREIGN SERVICE RETIREMENT AND DISABILITY
"SUBCHAPTER I?FOREIGN SERVICE RETIREMENT AND DISABILITY
SYSTEM"
(2) by striking out "this chapter" each place it appears and
inserting in lieu thereof "this subchapter"; and
(3) by inserting "under this subchapter" after "payable from
the Fund" each place it appears.
(b) CONFORMING AMENDMENTS RELATING TO RETIREMENT FOR
DISABILITY OR INCAPACITY.?(1) Section 808(d) (22 U.S.C. 4048(d)) is
amended?
(A) by striking out "such subchapter" each place it appears in
the second and third sentences and inserting in lieu thereof
"subchapter I of such chapter 8"; and
(B) by striking out "Act" each place it appears and inserting
in lieu thereof "subchapter".
(2) Section 808(e) (22 U.S.C. 4048(e)) is amended by striking out
"Act" each place it appears and inserting in lieu thereof "sub-
chapter".
(C) CONFORMING AMENDMENTS RELATING TO DEATH IN SERVICE.?
Section 809(a) (22 U.S.C. 4049(a)) is amended by striking out "Act"
and inserting in lieu thereof "subchapter".
SEC. 403. DEFINITION OF COURT.
Section 804(3) (22 U.S.C. 4044(3)) is amended by striking out "or of
the District of Columbia" and inserting in lieu thereof the following:
", the District of Columbia, the Commonwealth of Puerto Rico,
Guam, the Northern Mariana Islands, or the Virgin Islands, and
any Indian court as defined by section 201(3) of the Act entitled 'An
Act to prescribe penalties for certain acts of violence or intimida-
tion, and for other purposes', approved April 11, 1968 (25 U.S.C.
1301(3); 82 Stat. 77)".
Foreign Service
Pension System
Act of 1986.
22 USC 3901
note.
District of
Columbia,
Commonwealth
of Puerto Rico,
Guam, Northern
Mariana Islands,
Virgin Islands.
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100 STAT. 610 PUBLIC LAW 99-335?JUNE 6, 1986
Ante, p. 609;
post, p. 615.
SEC. 404. CREDITABLE SERVICE FOR PURPOSES OF SUBCHAPTERS I AND
II.
(a) PRO RATA SHARE.?Section 804(10) (22 U.S.C. 4044(10)) is
amended by inserting "(creditable under subchapter I or II)" after
"creditable service" each place it appears.
(b) FORMER SPOUSES.?(1) Section 814(aX1) (22 U.S.C. 4054(aX1)) is
amended by adding at the end thereof the following: "For the
purposes of this paragraph, the term 'creditable service' means
service which is creditable under subchapter I or II.".
(2) Section 814(bX1) (22 U.S.C. 4054(bX1)) is amended by adding at
the end thereof the following: "For the purposes of this paragraph,
the term 'creditable service' means service which is creditable under
subchapter I or II.".
(c) LUMP-SUM PAYMENTS.?Section 815(i) (22 U.S.C. 4055(i)) is
amended by adding at the end thereof the following: "For the
purposes of this subsection, the term 'creditable service' means
service which is creditable under subchapter I or II.".
SEC. 405. CONTRIBUTIONS TO THE FOREIGN SERVICE RETIREMENT AND
DISABILITY SYSTEM.
(a) CONTRIBUTIONS Arum DECEMBER 31, 1986.?Section 805 (22
U.S.C. 4045) is amended?
(1) by inserting "Except as provided in subsection (h)," before
"7 percent" in the first sentence of subsection (a); and
(2) by adding at the end thereof the following new subsection
(h):
"(h) Effective with respect to pay periods beginning after Decem-
ber 31, 1986, in administering this section with respect to a partici-
Post, p. 616. pant described in section 853(c) whose service is employment for the
42 USC 401. purposes of title II of the Social Security Act and chapter 21 of the
26 USC 3101 Internal Revenue Code of 1954, contributions to the Fund and
et seq. interest thereon shall be computed as if section 8334(k) of title 5,
United States Code, were applicable.".
(b) CREDITABILITY OF INTERIM SERVICE.?Subsection (d) of section
805 (22 U.S.C. 4045(d)) is amended by adding at the end thereof the
following:
"(4) Notwithstanding the preceding provisions of this subsection
and any provision of section 206(bX3) of the Federal Employees'
5 USC 8331 note. Retirement Contribution Temporary Adjustment Act of 1983, the
percentage of basic pay required under this subsection in the case of
a participant described in section 853(c) shall, with respect to any
5 USC 8331 note, covered service (as defined by section 203(aX3) of such Act) per-
formed by such individual after December 31, 1983, and before
January 1, 1987, be equal to 1.3 percent.".
SEC. 406. OFFSET OF ANNUITY BY THE AMOUNT OF SOCIAL SECURITY
BENEFITS.
Section 806 (22 U.S.C. 4046) is amended by adding at the end
thereof the following new subsection:
"(m) The annuity or survivor annuity payable to any individual
Supra. subject to section 805(h) beginning with the first month for which
such individual both?
"(1) attains the minimum age for old-age benefits under title
42 USC 401. II of the Social Security Act, and
"(2) first becomes entitled, or would upon proper application
become entitled, for disability or survivor benefits under title II
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rUISLIU iw 0U-660?JUNE 6, 1986 100 STAT. 611
of the Social Security Act based on the service of any individual 42 USC 401.
under this subchapter,
shall be computed as if section 8349 of title 5, United States Code, Ante, p. 589.
were applicable.".
SEC. 407. 18-MONTH PERIOD TO ELECT SURVIVOR ANNUITY.
Section 806 (22 U.S.C. 4046) is further amended by adding at the
end thereof the following:
"(nX1XA) A participant?
"(i) who, at the time of retirement, is married; and
"(ii) who elects at such time (in accordance with subsection
(b)) to waive a survivor annuity,
may, during the 18-month period beginning on the date of the
retirement of such participant, elect to have a reduction under
subsection (b) made in the annuity of the participant (or in such
portion thereof as the participant may designate) in order to provide
a survivor annuity for the spouse of such participant.
"(B) A participant?
"(i) who, at the time of retirement, is married, and
"(ii) who at such time designates (in accordance with subsec-
tion (b)) that a limited portion of the annuity of such participant
is to be used as the base for a survivor annuity,
may, during the 18-month period beginning on the date of the
retirement of such participant, elect to have a greater portion of the
annuity of such participant so used.
"(2XA) An election under subparagraph (A) or (B) of paragraph (1)
of this subsection shall not be considered effective unless the
amount specified in subparagraph (B) of this paragraph is deposited
into the Fund before the expiration of the applicable 18-month
period under paragraph (1).
"(B) The amount to be deposited with respect to an election under
this subsection is an amount equal to the sum of?
"(i) the additional cost to the System which is associated with
providing a survivor annuity under subsection (b) of this section
and results from such election taking into account (I) the dif-
ference (for the period between the date on which the annuity of
the former participant commences and the date of the election)
between the amount paid to such former participant under this
subchapter and the amount which would have been paid if such
election had been made at the time the participant or former
participant applied for the annuity, and (II) the costs associated
with providing the later election; and
"(ii) interest on the additional cost determined under clause
(i)(I) of this subparagraph computed using the interest rate
specified or determined under section 805(dX3) for the calendar
year in which the amount to be deposited is determined.
"(3) An election by a participant under this subsection voids
prospectively any election previously made in the case of such
participant under subsection (b).
"(4) An annuity which is reduced in connection with an election
under this subsection shall be reduced by the same percentage
reductions as were in effect at the time of the retirement of the
participant whose annuity is so reduced.
"(5) Rights and obligations resulting from the election of a reduced
annuity under this subsection shall be the same as the rights and
obligations which would have resulted had the participant involved
elected such annuity at the time of retiring.".
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IOU 1AI. tilZ PUBLIC LAW 99-335?JUNE 6, 1986
Regulations.
22 USC 4048.
22 USC 4046.
Post, p. 615.
SEC. 408. ALTERNATE FORMS OF ANNUITIES.
Section 807 (22 U.S.C. 4047) is amended by adding at the end
thereof the following:
"(e)(1) The Secretary of State shall prescribe regulations under
which a participant may, at the time of retiring under this sub-
chapter (other than under section 808), elect annuity benefits under
this section instead of any other benefits under this subchapter
(including survivor benefits) based on the service of the participant.
"(2) Subject to paragraph (3), the Secretary of State shall by
regulation provide for such alternative forms of annuities as the
Secretary considers appropriate, except that among the alternatives
offered shall be?
"(A) an alternative which provides for?
"(i) payment of the lump-sum credit (excluding interest)
to the participant; and
"(ii) payment of an annuity to the participant for life; and
"(B) in the case of a participant who is married at the time of
retirement, an alternative which provides for?
"(i) payment of the lump-sum credit (excluding interest)
to the participant; and
"(ii) payment of an annuity to the participant for life,
with a survivor annuity payable for the life of a surviving
spouse.
"(3) Each alternative provided for under paragraph (2) shall, to
the extent practicable, be designed such that the total value of the
benefits provided under such alternative (including any lump-sum
credit) is actuarially equivalent to the value of the annuity which
would otherwise be provided the participant under this subchapter,
as computed under section 806(a).
"(4) A participant who, at the time of retiring under this sub-
chapter?
"(A) is married, shall be ineligible to make an election under
this section unless a waiver is made under section 806(bX1XB);
or
"(B) has a former spouse, shall be ineligible to make an
election under this section if the former spouse is entitled to
benefits under this subchapter (based on the service of the
participant) unless a waiver has been made under section
806(bX1XC).
"(5) A participant who is married at the time of retiring under
this subchapter and who makes an election under this section may,
during the 18-month period beginning on the date of retirement,
make the election provided for under section 806(n), subject to the
deposit requirement thereunder.
"(6) Notwithstanding any other provision of law, any lump-sum
credit provided pursuant to an election under this subsection shall
not preclude an individual from receiving any other benefits under
this subsection.".
SEC. 409. TREATMENT OF CERTAIN RECALL SERVICE.
Section 823 (22 U.S.C. 4063) is amended by adding at the end
thereof the following:
"(c) If an annuitant becomes subject to subchapter II of this
chapter by reason of recall service?
"(1) subsections (a) and (b) shall not apply to such annuitant;
and
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PUBLIC LAW 99-335?JUNE 6, 1986 100 STAT. 613
"(2) section 824 shall apply to the recall service as if such
service were reemployment.".
SEC. 410. REEMPLOYMENT.
Section 824 (22 U.S.C. 4064) is amended to read as follows:
"SEC. 824. REEMPLOYMENT.?(aX1XA) Except in the case of an
annuitant who makes an election under subsection (b), if any former
participant, who has retired and is receiving an annuity under this
subchapter or subchapter II of this chapter, becomes employed in an Post, p. 615.
appointive or elective position in the Government, payment of any
annuity under either subchapter to the annuitant shall terminate
effective on the date of the employment and the reemployment
service shall be covered service under the rules of the system under
which the appointment is made.
"(B) If the annuity of an individual is terminated under subpara-
graph (A) and that individual becomes covered under the same
retirement system from which that annuity is terminated, that
individual shall be entitled to a redetermination of rights under that
system upon termination of the employment.
"(C) If the annuity is terminated and the individual becomes
covered under another contributory retirement system for Govern-
ment employees pursuant to paragraph (A), the individual shall be
entitled to benefits under the rules of that system. In addition, the
individual shall be entitled to a resumption of any annuity termi-
nated by reason of the employment.
"(bX1) A participant who is entitled to an annuity under this
subchapter or subchapter II of this chapter and becomes employed
in an appointive or elective position in the Government on a part-
time, intermittent, or temporary basis may elect to continue to
receive either or both annuities as provided in this subsection.
"(2) The total annuity payable under this chapter to an annuitant
making an election under paragraph (1) shall be reduced during the
part-time, intermittent, or temporary employment referred to in
paragraph (1) as necessary to meet the requirements of paragraph
(3).
"(3) The sum of?
"(A) the total annuity payable under this chapter to an
annuitant making an election under paragraph (1), and
"(B) the annual rate of pay payable to the annuitant during
the part-time, intermittent, or temporary employment referred
to in paragraph (1),
may not exceed, in any calendar year, the highest annual rate of pay
which is payable during such year for full-time employment in the
position in which the annuitant is employed.
"(4) Upon termination of the part-time, intermittent, or tem-
porary employment referred to in paragraph (1), payment of the full
annuity of an annuitant who has made an election under paragraph
(1) of this subsection shall resume.
"(c) The amount of annuity which has been terminated or reduced
under this section by reason of the reemployment of the annuitant
and is resumed under this section shall be the amount of the
annuity which would have been payable if the annuitant had not
accepted the reemployment. The amount of an annuity resulting
from a redetermination of rights pursuant to subsection (a) shall not
be less than the amount of an annuity resumed under the previous
sentence.
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100 STAT. 614 PUBLIC LAW 99-335?JUNE 6, 1986
"(d) The annuity rights of any participant who is reemployed in
the Government shall be determined under this section instead of
section 8468 of title 5, United States Code.
"(e) When any such retired participant is reemployed, the em-
ployer shall send a notice of such reemployment to the Secretary of
State, together with all pertinent information relating to such
employment, and shall pay directly to such participant the salary of
the position in which he or she is serving.
"(f) In the event of any overpayment under this section, such
overpayment shall be recovered by withholding the amount involved
from the salary payable to such reemployed participant or from any
other moneys, including annuity payments, payable under this
chapter.".
SEC. 411. COMPARABILITY BETWEEN THE FEDERAL EMPLOYEES'
RETIREMENT SYSTEM AND THE FOREIGN SERVICE PENSION
SYSTEM.
Section 827 (22 U.S.C. 4067) is amended by adding at the end
thereof the following:
President of U.S. "(C) The President shall maintain, under the same conditions and
in the same manner as provided in subsections (a) and (b) existing
conformity between the Federal Employees' Retirement System
provided in chapter 84 of title 5, United States Code, and the
Ante, p. 517. Foreign Service Pension System provided in subchapter II of this
chapter.".
SEC. 412. MODERATION OF REMARRIAGE PENALTY.
Chapter 8 of title I (22 U.S.C. 4041 et seq.) is further amended by
adding after section 827 the following:
22 USC 4068. "SEc. 828. REMARRIAGE.?Notwithstanding any other provision of
this subchapter, any benefit payable under this subchapter to a
surviving spouse, former spouse, or surviving former spouse that
would otherwise terminate or be lost if the individual remarried
before 60 years of age, shall not terminate or be lost if the re-
marriage occurred on or after November 8, 1984, and the individual
was 55 years of age or over on the date of the remarriage.".
SEC. 413. LUMP-SUM PAYMENTS.
22 USC 4055. Subsection (a) of section 815 is amended by adding at the end
thereof the following: "A participant who becomes subject to sub-
Post, p. 615. chapter II shall be entitled to payment of the lump-sum credit if,
and to the extent that, such lump-sum credit relates to service of a
type described in clauses (i) through (iii) of section 302(aX1XC) of the
Federal Employees' Retirement System Act of 1986.".
SEC. 414. EXCLUSION OF PARTICIPANTS IN FOREIGN SERVICE PENSION
SYSTEM FROM FOREIGN SERVICE RETIREMENT AND DISABIL-
ITY SYSTEM.
22 USC 4043. Section 803 is amended?
(1) in subsection (a), by striking out "The" and inserting in
lieu thereof "Except as provided in subsection (d), the"; and
(2) by adding at the end thereof the following:
"(d) An individual subject to the Foreign Service Pension System
(described in subchapter II) is not a participant in this System.".
SEC. 415. FOREIGN SERVICE PENSION SYSTEM.
Chapter 8 of title I (22 U.S.C. 4041 et seq.) is further amended by
adding at the end thereof the following:
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YUBLK; LAW 99-335?JUNE 6, 1986 100 STAT. 615
"SUBCHAPTER II?FOREIGN SERVICE PENSION SYSTEM
"SEC. 851. ESTABLISHMENT.?(a) There is hereby established a 22 USC 4071.
Foreign Service Pension System.
"(b) Except as otherwise specifically provided in this subchapter or
any other provision of law, the provisions of chapter 84 of title 5,
United States Code, shall apply to all participants in the Foreign Ante, p. 517.
Service Pension System and such participants shall be treated in all
respects similar to persons whose participation in the Federal
Employees' Retirement System provided in that chapter is required.
"SEC. 852. DEEnvrrioNs.?As used in this subchapter, unless other- 22 USC 4071a.
wise specified?
"(1) the term 'court order' has the same meaning given in
section 804(4); 22 USC 4044.
"(2) the term 'Fund' means the Foreign Service Retirement
and Disability Fund maintained by the Secretary of the Treas-
ury pursuant to section 802;
"(3) the term 'normal cost' means the entry-age normal cost of
the provisions of the System which relate to the Fund, com-
puted by the Secretary of State in accordance with generally
accepted actuarial practice and standards (using dynamic
assumptions) and expressed as a level percentage of aggregate
basic pay;
"(4) the term 'participant' means a person who participates in
the Foreign Service Pension System;
"(5) the term 'pro rata share' in the case of any former spouse
of any participant or former participant means the percentage
which is equal to the percentage that (A) the number of years
during which the former spouse was married to the participant
during the service of the participant which is creditable under
this chapter is of (B) the total number of years of such service,
disregarding extra credit under section 817;
"(6) the term 'supplemental liability' means the estimated
excess of?
"(A) the actuarial present value of all future benefits
payable from the Fund under this subchapter based on the
service of participants or former participants, over
"(B) the sum of?
"(i) the actuarial present value of (I) deductions to be
withheld from the future basic pay of participants
pursuant to section 856 and (II) contributions for past
civilian and military service;
"(ii) the actuarial present value of future contribu-
tions to be made pursuant to section 857;
"(iii) the Fund balance as of the date the supple-
mental liability is determined, to the extent that such
balance is attributable?
"(I) to the System, or
"(II) to the contributions made under the Federal
Employees' Retirement Contribution Temporary
Adjustment Act of 1983 (5 U.S.C. 8331 note); and
"(iv) any other appropriate amount, as,determined-by
the Secretary of State in accordance with generally
accepted actuarial practices and principles; and
"(7) the term 'System' means the Foreign Service Pension
System.
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.IUu0.111.1. bib PUBLIC LAW 99-335?JUNE 6, 1986
22 USC 4071b. "SEc. 853. PARTICIPANTS.?(a) Except for persons excluded by
subsection (b), (c), or (d), all members of the Foreign Service, any of
whose service after December 31, 1983, is employment for the
42 USC 401. purpose of title II of the Social Security Act and chapter 21 of the
26 USC 3101 Internal Revenue Code of 1954, who would, but for this section, be
et seq. participants in the Foreign Service Retirement and Disability
Ante, p. 614. System pursuant to section 803 shall instead be participants in the
Foreign Service Pension System.
"(b) Members of the Service who were participants in the Foreign
Service Retirement and Disability System on or before December 31,
1983, and who have not had a break in service in excess of one year
since that date, are not made participants in the System by this
section, without regard to whether they are subject to title II of the
Social Security Act.
"(c) Individuals who become members of the Service after having
completed at least 5 years of civilian service creditable under sub-
Ante, pp. 589, chapter I, subchapter III of chapter 83 of title 5, United States Code
591-593. (the Civil Service Retirement System), or title II of the Central
5 USC 403 note. Intelligence Agency Retirement Act of 1964 for Certain Employees
(determined without regard to any deposit or redeposit requirement
under any such subchapter or title, any requirement that the
individual become subject to such subchapter or title after perform-
ing the service involved, or any requirement that the individual give
notice in writing to the official by whom such individual is paid of
such individual's desire to become subject to such subchapter or
title) are not participants in the System, except to the extent
provided for under title III of the Federal Employees' Retirement
System Act of 1986 pursuant to an election under such title to
become subject to this subchapter (under regulations issued by the
Secretary of State pursuant to section 860).
"(d) The Secretary may exclude from the operation of this sub-
chapter any member of the Foreign Service, or group of members,
whose employment is temporary or intermittent, except a member
whose employment is part-time career appointment or career can-
22 USC 3946. didate appointment under section 306.
22 USC 4071c. "SEC. 854. CREDITABLE SERVICE.?(a) For purposes of this sub-
chapter, creditable service of a participant includes?
"(1) service as a participant after December 31, 1986;
"(2) service with respect to which deductions and
withholdings under section 204(aX2) of the Federal Employees'
5 USC 8331 note. Retirement Contribution Temporary Adjustment Act of 1983
have been made; and
"(3) except as provided in subsection (b), any civilian service
performed before January 1, 1989 (other than service under
paragraph (1) or (2)), which, but for the amendment made by
section 414 of the Federal Employees' Retirement System Act of
1986, would be creditable under subchapter I (determined with-
out regard to any deposit or redeposit requirement under such
subchapter, subchapter III of chapter 83 of title 5, United States
Code (the Civil Service Retirement System), or title II of the
Central Intelligence Agency Retirement Act of 1964 for Certain
5 USC 403 note. Employees, any requirement that the individual become subject
to such subchapter or title after performing the service in-
volved, or any requirement that the individual give notice in
writing to the official by whom such individual is paid of such
individual's desire to become subject to such subchapter or
title).
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PUBLIC LAW 99-335?JUNE 6, 1986 100 STAT. 617
"(bX1) A participant who has received a refund of retirement
deductions under subchapter I with respect to any service described
in subsection (aX3) may not be allowed credit for such service under
this subchapter unless such participant deposits into the Fund an
amount equal to 1.3 percent of basic pay for such service, with
interest.
"(2) A participant may not be allowed credit under this sub-
chapter for any service described in subsection (aX3) for which
retirement deductions under subchapter I have not been made,
unless such participant deposits into the Fund an amount equal to
1.3 percent of basic pay for such service, with interest.
"(3) Interest under paragraph (1) or (2) shall be computed in
accordance with section 805(d) and regulations issued by the Sec-
retary of State.
"(c) Credit shall be given under this System to a participant for a Voluntarism.
period of prior satisfactory service as?
"(1) a volunteer or volunteer leader under the Peace Corps
Act (22 U.S.C. 2501 et seq.),
"(2) a volunteer under part A of title VIII of the Economic
Opportunity Act of 1964, or 42 USC 2991
"(3) a full-time volunteer for a period of service of at least one and note.
year's duration under part A, B, or C of title I of the Domestic
Volunteer Service Act of 1973 (42 U.S.C. 4951 et seq.),
if the participant makes a payment to the Fund equal to 3 percent of
pay received for the volunteer service (as determined in accordance
with regulations of the Secretary of State consistent with regula-
tions for making corresponding determinations under chapter 83,
title 5, United States Code) together with interest determined under
refulations issued by the Secretary of State.
'(d) Credit shall be given under this System to a participant for a
period of prior service under the Federal Employees' Retirement
System (described in chapter 84 of title 5, United States Code) or
under title III of the Central Intelligence Agency Retirement Act of
1964 for Certain Employees if the participant waives credit under Post, p. 624.
the other retirement system and makes a payment to the Fund
equal to the amount which would have been deducted from pay
under section 856(a) had the individual been a participant during
the prior creditable service under the other retirement system
together with interest on such amount computed in accordance with
regulations issued by the Secretary of State.
'SEC. 855. ENTITLEMENT TO ANNurrv.?(aX1) Any participant may 22 USC 4071d.
be retired under the conditions specified in section 811 and shall be 22 USC 4051.
retired under the conditions specified in sections 812 and 813 and 22 USC 4052,
receive benefits under this subchapter. 4053.
"(2) For the purposes of this subsection?
"(A) the term 'participant', as used in the sections referred to
in paragraph (1), means a participant in the Foreign Service
Pension System; and
"(B) the term 'System', as used in those sections, means the
Foreign Service Pension System.
"(bX1) Any participant who retires voluntarily or mandatorily
under section 607, 608, 811, 812, or 813 under conditions authorizing 22 USC 4007,
an immediate annuity for participants in the Foreign Service Retire- 4008.
ment and Disability System and who has completed at least 5 years
of service subject to this chapter shall be entitled to an immediate
annuity computed under paragraph (2).
"(2) An annuity under paragraph (1) shall be computed?
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100 STAT. 618 PUBLIC LAW 99-335?JUNE 6, 1986
"(A) for all service earned while a participant in this System,
at the rate stated in section 8415(d) of title 5, United States
Ante, p. 527. Code; and
"(B) for all service earned while a participant in another
retirement system creditable under section 854(d), at the rate
which would have been applicable to the individual had that
individual remained a participant in the other system; and
"(C) for all volunteer service creditable under section 854(c),
at the rate stated in section 8415(a) of title 5, United States
Code.
"(c) A participant who is entitled to an immediate annuity under
subsection (b) shall be entitled to receive an annuity supplement
while the annuitant is under 62 years of age. The annuity supple-
ment shall be based on the total creditable service of the annuitant
and shall be computed in accordance with sections 8421(b) and 8421a
of title 5, United States Code, as if the participant were a law
enforcement officer retired under section 8412(d) of such title.
Treason. "(d) Any participant who is separated for cause under section 610
22 USC 4010. shall not be entitled to an annuity under this System when the
Secretary determines that the separation was based in whole or in
part on disloyalty to the United States.
22 USC 4071e. "SEC. 856. DEDUCTIONS AND WITHHOLDINGS FROM PAY.?(a) The
employing agency shall deduct and withhold from basic pay of each
participant a percentage of basic pay equal to 7? percent minus the
percentage then in effect under section 3101(a) of the Internal
26 USC 3101. Revenue Code of 1954 (relating to the rate of tax for old age,
survivors and disability insurance).
"(b) Each participant is deemed to consent and agree to the
deductions under subsection (a). Notwithstanding any law or regula-
tion affecting the pay of a participant, payment less such deductions
is a full and complete discharge and acquittance of all claims and
demands for regular services during the period covered by the
payment, except the right to any benefits under this subchapter
based on the service of the participant.
"(c) Amounts deducted and withheld under this section shall be
deposited in the Treasury of the United States to the credit of the
Fund under such procedures as the Comptroller General of the
United States may prescribe.
"(d) Under such regulations as the Secretary of State may issue,
amounts deducted under subsection (a) shall be entered on individ-
ual retirement records.
22 USC 4071f. "SEC. 857. GOVERNMENT CONTRIBUTIONS.?(a) Each agency employ-
ing any participant shall contribute to the Fund the amount com-
puted in a manner similar to that used under section 8423(a) of title
5, United States Code, pursuant to determinations of the normal
cost percentage for the Foreign Service Pension System by the
Secretary of State.
"(bX1) The Secretary of State shall compute the amount of the
supplemental liability of the Fund as of the close of each fiscal year
beginning after September 30, 1987. The amount of any such supple-
mental liability shall be amortized in 30 equal annual installments
with interest computed at the rate used in the most recent valuation
of the System.
"(2) At the end of each fiscal year, the Secretary of State shall
notify the Secretary of the Treasury of the amount of the install-
ment computed under this subsection for such year.
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PUBLIC LAW 99-335?JUNE 6, 1986
100 STAT. 619
"(3) Before closing the accounts for a fiscal year, the Secretary of
the Treasury shall credit to the Fund, as a Government contribu-
tion, out of any money in the Treasury of the United States not
otherwise appropriated, the amount under paragraph (2) of this
subsection for such year.
"SEc. 858. COST-OF-LIVING ADJUSTMENTS.?Cost-of-living adjust-
ments for annuitants under this System shall be granted under
procedures in section 8462 of title 5, United States Code, in the same
manner as such adjustments are made for annuitants referred to in
subsection (cX3XBXii) of such section.
"SEc. 859. GENERAL AND ADMINISTRATIVE PROVISIONS.?(a) The
Secretary of State shall administer the Foreign Service Pension
System except for matters relating to the Thrift Savings Plan
provided in subchapters III and VII of chapter 84 of title 5, United
States Code. The Secretary of State shall, with respect to the
Foreign Service Pension System, perform the functions and exercise
the authority vested in the Office of Personnel Management or the
Director of such Office by such chapter 84 and may issue regulations
for such purposes.
"(b) Determinations of the Secretary of State under the Foreign
Service Pension System which, if made by the Office of Personnel
Management under chapter 84 of title 5, United States Code, or the
Director of such Office, would be appealable to the Merit Systems
Protection Board shall, instead, be appealable to the Foreign Service
Grievance Board, except that determinations of disability for
? participants shall be based upon the standards in section 808 (other
than the exclusion for vicious habits, intemperance, or willful mis-
conduct) and subject to review in the same manner as under that
section.
"(c) At least every 5 years, the Secretary of the Treasury shall
prepare periodic valuations of the Foreign Service Pension System
and shall advise the Secretary of State of (1) the normal cost of the
System, (2) the supplemental liability of the System, and (3) the
amounts necessary to finance the costs of the System.
? "SEc. 860. TElorsmoN PROVISIONS.?The Secretary of State shall
issue regulations providing for the transition from the Foreign
Service Retirement and Disability System to the Foreign Service
Pension System in a manner comparable to the transition of
employees subject to subchapter III of chapter 83 of title 5, United
States Code (the Civil Service Retirement System), to the Federal
Employees' Retirement System. For this and related purposes, ref-
erences made to participation in subchapter III of chapter 83 of title
5, United States Code (the Civil Service Retirement System), the
Social Security Act, and the Internal Revenue Code of 1954 shall be
deemed to refer to participation in the Foreign Service Pension
System or the Foreign Service Retirement and Disability System, as
appropriate.
? "SEc. 861. FORMER SPOUSES.?(a)(1XA) Unless otherwise expressly
provided by any spousal agreement or court order governing disposi-
tion of benefits under this subchapter, a former spouse of a partici-
pant or former participant is entitled, during the period described in
subparagraph (B), to a share (determined under paragraph (2)) of all
benefits otherwise payable to such participant under this sub-
chapter if such former spouse was married to the participant for at
least 10 years during service of the participant which is creditable
under this chapter with at least 5 of such years occurring while the
participant was a member of the Foreign Service.
22 USC 4071g.
22 USC 4071h.
Regulations.
22 USC 407E.
Ante, pp. 589,
591-593.
42 USC 1305.
26 USC 1 et seq.
22 USC 4071j.
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100 STAT. 620 PUBLIC LAW 99-335?JUNE 6, 1986
26 USC 1 et seq.
Ante, p. 522.
"(B) The period referred to in subparagraph (A) is the period
which begins on the first day of the month following the month in
which the divorce or annulment becomes final and ends on the last
day of the month before thq former spouse dies or remarries before
55 years of age.
"(2) The share referred to in paragraph (1) equals?
"(A) 50 percent, if such former spouse was married to the
participant throughout the actual years of service of the partici-
pant which are creditable under this chapter; or
"(B) a pro rata share of 50 percent, if such former spouse was
not married to the participant throughout such creditable
service.
"(3) A former spouse shall not be qualified for any benefit under
this subsection if, before the commencement of any benefit, the
former spouse remarries before becoming 55 years of age.
"(4XA) For purposes of the Internal Revenue Code of 1954, pay-
ments to a former spouse under this section shall be treated as
income to the former spouse and not to the participant.
"(B) Any reduction in payments to a participant or former partici-
pant as a result of payments to a former spouse under this subsec-
tion shall be disregarded in calculating?
"(i) the survivor annuity for any spouse, former spouse, or
other survivor under this subchapter, and
"(ii) any reduction in the annuity of the participant to provide
survivor benefits under this subchapter.
"(5) Notwithstanding subsection (aX1), in the case of any former
spouse of a disability annuitant?
"(A) the annuity of the former spouse shall commence on the
date the participant would qualify, on the basis of his or her
creditable service, for an annuity under this chapter (other than
a disability annuity) or the date the disability annuity begins,
whichever is later, and
"(B) the amount of the annuity of the former spouse shall be
calculated on the basis of the annuity for which the participant
would otherwise so qualify.
"(6XA) Except as provided in subparagraph (B), any former spouse
who becomes entitled to receive any benefit under this subchapter
which would otherwise be payable to a participant or former partici-
pant shall be entitled to make any election regarding method of
payment to such former spouse that such participant would have
otherwise been entitled to elect, and the participant may elect an
alternate method for the remaining share of such benefits. Such
elections shall not increase the actuarial present value of benefits
expected to be paid under this subchapter.
"(B) A former spouse may not elect a method of payment under
subchapter II, chapter 84 of title 5, United States Code, providing for
payment of a survivor annuity to any survivor of the former spouse.
"(7) The maximum amount payable to any former spouse pursu-
ant to this subsection shall be the difference, if any, between 50
percent of the total benefits authorized to be paid to a former
participant by this subchapter, disregarding any apportionment of
these benefits to others, and the aggregate amount payable to all
others at any one time.
"(bX1) Unless otherwise expressly provided for by any spousal
agreement or court order governing survivorship benefits under this
subchapter to a former spouse married to a participant or former
participant for the periods specified in subsection (a)(1XA), such
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PUBLIC LAW 99-335?JUNE 6, 1986 100 STAT. 621
former spouse is entitled to a share, determined under subsection
(bX2), of all survivor benefits that would otherwise be payable under
this subchapter to an eligible surviving spouse of the participant.
"(2) The share referred to in subsection (bX1) equals?
"(A) 100 percent if such former spouse was married to the
participant throughout the entire period of service of the
participant which is creditable under this chapter; or
"(B) a pro rata share of 100 percent if such former spouse was
not married to the participant throughout such creditable
service.
"(c) A participant or former participant may not make any elec-
tion or modification of election under section 8417, 8418, or 8433 of
? title 5, United States Code, or other section relating to the partici-
pant's account in the Thrift Savings Plan or annuity under the basic
plan that would diminish the entitlement of a former spouse to any
benefit granted to the former spouse by this section or in a current
? spousal agreement.
"(d) If a member becomes a participant under this subchapter
after qualifying for benefits under subchapter I and, at the time of
transfer, has a former spouse entitled to benefits under subchapter I
which are determined under section 814 or 815 (as determined by 22 USC 4054,
? the Secretary of State) and are similsr in amount to a pro rata share 4055.
division under section 814 or 815 and the service of the member as a
participant under this subchapter is not recognized in determining
that pro rata share, then subsections (a) and (b) of this section shall
not apply to such former spouse. Otherwise, subsections (a) and (b) of
this section shall apply.
"(e) If a participant dies after completing at least 18 months of
service or a former participant dies entitled to a deferred annuity,
but before becoming eligible to receive the annuity, and such partici-
pant or former participant has left with the Secretary of State a
spousal agreement promising a share of a survivor annuity under
subchapter W, chapter 84, title 5, United States Code, to a former
spouse, such survivor annuity shall be paid under the terms of this
subchapter as if the survivor annuity had been ordered by a court.
"SEc. 862. SPOUSAL AGREEMENTS.?A spousal agreement is any 22 USC 4071k.
written agreement (properly authenticated as determined by the
? Secretary of State) between a participant or former participant and
his or her spouse or former spouse on file with the Secretary of
State. A spousal agreement shall be consistent with the terms of this
Act and applicable regulations and, if executed at the time a partici-
pant or former participant is currently married, shall be approved
? by such current spouse. It may be used to fix the level of benefits
payable under this subchapter to a spouse or former spouse.".
SEC. 416. TABLE OF CONTENTS.
The table of contents in section 2 of such Act is amended?
(1) by striking out the item relating to chapter 8 and inserting
in lieu thereof the following:
"CHAPTER 8?FOREIGN SERVICE RETIREMENT AND DISABILTTY
"SUBCHAPTER I-FOREIGN SERVICE RETIREMENT AND DISABILITY SYSTEM";
and
(2) by inserting after the item relating to section 827 the
following:
"Sec. 828. Remarriage.
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100 STAT. 622 PUBLIC LAW 99-335?JUNE 6, 1986
22 USC 4046
note.
22 USC 4022.
Ante, p. 615.
22 USC 4022;
ante, p. 611.
50 USC 403 note.
"SUBCHAPTER II?FOREIGN SERVICE PENSION SYSTEM
"Sec. 851. Establishment.
"Sec. 852. Definitions.
"Sec. 853. Participants.
"Sec. 854. Creditable service.
"Sec. 855. Entitlement to annuity.
"Sec. 856. Reduction and withholdings from pay.
"Sec. 857. Government contributions.
"Sec. 858. Cost-of-living adjustments.
"Sec. 859. General and administrative provisions.
"Sec. 860. Transition provisions.
"Sec. 861. Former spouses.
"Sec. 862. Spousal agreements.".
SEC. 417. EFFECTIVE DATE.
(a) REGULATIONS.?Notwithstanding section 702 of this Act, the
authority of the Secretary of State to issue regulations under sub-
chapter II of title 8 of the Foreign Service Act of 1980 shall take
effect on the date of enactment of this Act.
(b) 18-MONTH PERIOD TO ELECT SURVIVOR ANNUITY.?(1) Notwith-
standing section 702 of this Act, the amendment made by section 407
shall take effect 3 months after the date of enactment of this Act.
(2XA) Subject to subparagraph (B), the amendment made by sec-
tion 407 shall apply with respect to participants and former partici-
pants who retire before, on, or after such amendment first takes
effect.
(B) For the purpose of applying the provisions of paragraph (1) of
section 806(n) of the Foreign Service Act of 1980 (as added by section
407) to former participants who retire before the date on which the
amendment first takes effect?
(i) the period referred to in subparagraph (A) or (B) of such
paragraph (as the case may be) shall be considered to begin on
the date on which such amendment first becomes effective; and
(ii) the amount referred to in paragraph (2) of such section
806(n) shall be computed without regard to the provisions of
subparagraph (BXii) of such paragraph (relating to interest).
(3) For purposes of this subsection, the term "participant" has the
meaning given that term in section 803 of the Foreign Service Act of
1980 (22 U.S.C. 4043).
TITLE V-CENTRAL INTELLIGENCE
AGENCY RETIREMENT AND RELATED
MATTERS
SEC. 501. REFERENCES.
The Central Intelligence Agency Retirement Act of 1964 for Cer-
tain Employees (78 Stat. 1043; 50 U.S.C. 403 note) is amended?
(1) in section 201(c), by inserting "(except section 305(d) of this
Act)" after "or any other provisions of law";
(2) by striking out "this Act" each place it appears in title II
except in sections 201 and 264, and inserting in lieu thereof
"this title"; and
(3) by inserting "under this title" after "payable from the
fund" each place it appears in title II.
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100 STAT. 623
SEC. 502. CONTRIBUTIONS TO THE CENTRAL INTELLIGENCE AGENCY
RETIREMENT AND DISABILITY SYSTEM.
Section 211 of the Central Intelligence Agency Retirement Act of
1964 for Certain Employees is amended?
(1) by striking out "Seven" in the first sentence of subsection
(a) and inserting in lieu thereof "Except as provided in subsec-
tion (d), seven"; and
(2) by adding at the end thereof the following new subsection
(d):
"(dX1) In the case of a participant who was a participant subject to
this title before January 1, 1984, and whose service?
"(A) is employment for the purposes of title II of the Social
Security Act and chapter 21 of the Internal Revenue Code of
1954, and
"(B) is not creditable service for any purpose under title HI of
this Act or chapter 84 of title 5, United States Code,
there shall be deducted and withheld from the basic pay of the
participant under this subsection during any pay period only the
amount computed pursuant to paragraph (2).
"(2) The amount deducted and withheld from the basic pay of a
participant during any pay period pursuant to paragraph (1) shall be
the excess of?
"(A) the amount determined by multiplying the percent ap-
plicable to the participant under subsection (a) by the basic pay
payable to the participant for such pay period, over
"(B) the amount of the taxes deducted and withheld from such
basic pay under section 3101(a) of the Internal Revenue Code of
1954 (relating to old-age, survivors, and disability insurance) for
such pay period.".
SEC. 503. OFFSET OF ANNUITY BY THE AMOUNT OF SOCIAL SECURITY
BENEFITS.
Section 221 of the Central Intelligence Agency Retirement Act of
1964 for Certain Employees is amended by adding at the end thereof
the following new subsection:
"(pX1) Notwithstanding any other provision of this title, except as
provided in paragraph (2), an annuity (including a disability annu-
ity) payable under this title to an individual described in section
301(cX1) and any survivor annuity payable under this title on the
basis of the service of such individual shall be reduced in a manner
consistent with section 8349 of title 5, United States Code, under
conditions consistent with the conditions prescribed in such section.
"(2) This section shall not apply with respect to any annuity, or
survivor annuity, which is based on the service of an individual
described in section 301(cX2).".
SEC. 504. THRIVE SAVINGS FUND PARTICIPATION BY PARTICIPANTS IN
THE CENTRAL INTELLIGENCE AGENCY RETIREMENT AND
DISABILITY SYSTEM.
Part K of title II of the Central Intelligence Agency Retirement
Act of 1964 for Certain Employees is amended by adding at the end
thereof the following new section:
50 USC 403 note.
42 USC 401.
26 USC 3101 et
seq.
Ante, p. 517.
26 USC 3101.
50 USC 403 note.
Ante, p. 589.
Post, p. 624.
50 USC 403 note.
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100 STAT. 624 PUBLIC LAW 99-335?JUNE 6, 1986
50 USC 403 note.
Ante, p. 593.
Regulations.
50 USC 403 note.
Ante, p. 591.
Ante, p. 622.
50 USC 403 note.
42 USC 401.
26 USC 3101 et
seq.; ante, p. 517.
"THRIFT SAVINGS FUND PARTICIPATION BY PARTICIPANTS IN THE
CENTRAL INTELLIGENCE AGENCY RETIREMENT AND DISABILITY
SYSTEM
"SEC. 293. (a) Participants in the Central Intelligence Agency
Retirement and Disability System shall be deemed to be employees
for the purposes of section 8351 of title 5, United States Code.
"(b) Subsections (k) and (m) of section 8461 of title 5, United States
Code, shall apply with respect to contributions made by officers and
employees of the Agency to the Thrift Savings Fund under section
8351 of such title, and to earnings attributable to the investment of
such contributions.".
SEC. 505. ALTERNATIVE FORMS OF ANNUITIES.
Part K of title II of the Central Intelligence Agency Retirement
Act of 1964 for Certain Employees (as amended by section 504 of this
Act) is further amended by adding at the end thereof the following
new section:
"ALTERNATIVE FORMS OF ANNUITIES
"SEC. 294. (a) The Director shall prescribe regulations under
which an officer or employee of the Agency may, at the time of
retiring under this title (other than under section 231), elect annuity
benefits under this section instead of any other benefits under this
title (including any survivor benefits under this title) based on the
service of the officer or employee creditable under this title. The
regulations and alternatives shall, to the maximum extent prac-
ticable, meet the requirements prescribed in section 8343a of title 5,
United States Code.
"(b) Notwithstanding any other provision of law, any lump-sum
credit provided pursuant to an election under subsection (a) shall
not preclude an individual from receiving other benefits provided
under such subsection.
"(c) The Director shall submit the regulations prescribed under
subsection (a) to the Select Committee on Intelligence of the Senate
and the Permanent Select Committee on Intelligence of the House
of Representatives before the regulations take effect.".
SEC. 506. PARTICIPATION IN THE FEDERAL EMPLOYEES' RETIREMENT
SYSTEM.
The Central Intelligence Agency Retirement Act of 1964 for Cer-
tain Employees is amended by adding at the end thereof the
following:
"TITLE III?PARTICIPATION IN THE FEDERAL EMPLOYEES'
RETIREMENT SYSTEM
"APPLICATION OF FEDERAL EMPLOYEES' RETIREMENT SYSTEM TO
AGENCY EMPLOYEES
"SEC. 301. (a) Except as provided in subsections (b) and (c), all
officers and employees of the Agency, any of whose service after
December 31, 1983, is employment for the purpose of4itle II of the
Social Security Act and chapter 21 of the Internal Revenue Code of
1954, shall be subject to chapter 84 of title 5, United States Code.
"(b) Participants in the Central Intelligence Agency Retirement
and Disability System who were participants in such system on or
before December 31, 1983, and who have not had a break in service
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,-,,-00.?JUNE 6, 1986 100 STAT. 625
in excess of 1 year since that date, are not subject to chapter 84 of
title 5, United States Code, without regard to whether they are Ante, p. 517.
subject to title II of the Social Security Act. 42 USC 401.
"(cX1) The provisions of chapter 84 of title 5, United States Code,
shall not apply with respect to?
"(A) any individual who separates, or who has separated,
from Federal Government service after having been an officer
or employee of the Agency subject to title II of this Act; and
"(B) any officer or employee of the Agency having at least 5
years of civilian service which was performed before January 1,
1987, and is creditable under title II of this Act (determined
without regard to any deposit or redeposit requirement under
subchapter HI of chapter 83 of title 5, United States Code, or Ante, pp. 589,
under title II of this Act, or any requirement that the individual 591-593.
become subject to such subchapter or to title H of this Act after
performing the service involved).
"(2) Paragraph (1) shall not apply with respect to an individual
who has elected under regulations prescribed under section 307 of
this Act to become subject to chapter 84 of title 5, United States Post, p. 628.
Code, to the extent provided in such regulations.
"(3) An individual described in paragraph (1) shall be deemed to
be an individual excluded under section 8402(bX2) of title 5, United
States Code.
"(d) The application of the provisions of chapter 84 of title 5,
-,Vnited States Code, to officers and employees referred to in subsec-
tion (a) shall be subject to the exceptions and special rules provided
in this title. Any provision of such chapter which is inconsistent
with a special rule provided in this title shall not apply to such
officers and employees.
"SPECIAL RULES RELATING TO SECTION 203 CRITERIA EMPLOYEES
"SEC. 302. (a) Except as otherwise provided in this section, in the 50 USC 403 note.
application of chapter 84 of title 5, United States Code, to an officer
or employee of the Agency who is subject to such chapter and is
designated by the Director under the criteria prescribed in section
203, such officer or employee shall be treated for purposes of deter-
mining such officer's or employee's retirement benefits and obliga-
tions under such chapter as if the officer or employee were a law
enforcement officer (as defined in section 8401(17) of title 5, United
, States Code).
"(b) The provisions of sections 233 and 235 of this Act shall apply 50 USC 403 note.
to officers and employees referred to in subsection (a), except that
the retirement benefits shall be determined under the provisions of
chapter 84 of title 5, United States Code.
"(cX1) Except as provided in paragraph (2), section 271 of this Act
shall apply to an officer or employee referred to in subsection (a).
"(2) Contributions during recall service shall be made as provided
in section 8422 of title 5, United States Code.
"(3) When an officer or employee recalled under this subsection
reverts to a retired status, the annuity of such officer or employee
shall be redetermined under the provisions of chapter 84 of title 5,
United States Code.
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100 STAT. 626 PUBLIC LAW 99-335?JUNE 6, 1986
50 USC 403 note.
Ante, p. 517.
50 USC 403 note.
50 USC 403 note.
"SPECIAL RULES FOR OTHER EMPLOYEES FOR SERVICE ABROAD
"SEc. 303. (a) Notwithstanding any provision of chapter 84 of title
5, United States Code, the annuity under subchapter II of such
chapter of a retired officer or employee of the Agency who is not
designated under section 302(a) of this Act and has served abroad as
an officer or employee of the Agency shall be computed as provided
in subsection (b).
"(bX1) The portion of the annuity relating to service abroad
performed on or after the effective date of the Federal Employees'
Retirement System Act of 1986 shall be computed as provided in
section 8415(d) of title 5, United States Code.
"(2) The portions of the annuity relating to other service in the
Agency shall be computed as provided in the provision of section
8415 of such title that is applicable to such service under the
conditions prescribed in chapter 84 of such title.
"SPECIAL RULES FOR FORMER SPOUSES
"SEC. 304. (a) Section 8445 of title 5, United States Code, and
subsections (d) and (e) of section 8435 of such title shall not apply in
the case of an officer or employee of the Agency who is subject to
chapter 84 of title 5, United States Code, and who has a former
spouse (as defined in section 204(bX4) of this Act). Any reference in
such chapter to a survivor annuity for a former spouse, as applied to ,
such officer or employee, shall be deemed to refer to a survivor
annuity for a former spouse of such officer or employee provided
under subsection (c) of this section.
"(b) Section 221(bX1XC) of this Act shall apply to a survivor
annuity under subsection (cX2) of this section.
"(c) Except as otherwise provided in this section, the following
provisions of title II of this Act shall apply in the case of an officer
or employee of the Agency who is entitled to receive an annuity
under subchapter II, III, or V of chapter 84 of title 5, United States
Code, in the same manner as such provisions apply in the case of an
officer or employee of the Agency under title II:
"(1) Section 222, except that subsections (b) and (c) of such
section shall be subject to a waiver under subsection (b) of this
section.
"(2) Subsections (a), (bX1), and (hX3) of section 223 and the first
sentence of subsection (c) of such section.
"(3) Subsections (c) and (d) of section 234 (in the case of any
lump-sum payment under section 8424(a) of title 5, United
States Code, and any payment under subsection (bX3), (hX4),
(cX3), (cX4), or (d) of section 8433 of such title).
"(4) Section 263(b).
"(d) In the application of section 222(a) under subsection (cX1)?
"(1) the reference in paragraph (4XB) of such section to section
271, 272, or 273 of this Act shall be deemed to refer to any
similar provision of law applicable to such officer or employee
for purposes of chapter 84 of title 5, United States Code;
"(2) the amount of the reduction in the salary of a recalled or
reinstated officer or employee under such paragraph (4XB) shall
be only the amount by which the annuity under subchapter II
or V of chapter 84 of title 5, United States Code, would have
been reduced; and
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PUBLIC LAW 99-335?JUNE 6, 1986 100 STAT. 627
"(3) amounts to be deposited in the Treasury of the United
States pursuant to such paragraph (4XB) shall be credited to the
Civil Service Retirement and Disability Fund.
"(e) In the application of subsections (b) and (c) of section 222
under subsection (cX2)?
"(1) the percentage prescribed in subsections (bX1XA), (bX1XB),
(bX4XA), and (cX2) of such section shall be deemed to be 50
percent;
"(2) for the purpose of computing the amount of the former
spouse's annuity under subsection (bX1) of such section and the
maximum amount of survivor annuities under subsection (bX4)
or (cX2) of such section, the full amount of the deceased officer's
or employee's annuity?
"(A) in the case of an annuity under subchapter II or V of
chapter 84 of title 5, United States Code, is the amount of
such annuity computed without regard to the reduction for
survivor annuities; and
"(B) in the case of an annuity under subchapter III of
such chapter, is the amount of such annuity computed on
an actuarial basis as provided in such subchapter taking
into account the application of section 222(bX1) in the case
of such annuity;
"(3) an election under subsection (bX5XB) of such section shall
apply with respect to a survivor annuity for a spouse under
section 8442 of title 5, United States Code;
"(4) the reference in subsection (cX2) of such section to a
survivor annuity for a spouse shall be deemed to refer?
"(A) in the case of an annuity under subchapter II or V of
chapter 84 of title 5, United States Code, to the survivor
annuity provided in section 8442 of title 5, United States
Code; and
"(B) in the case of an annuity under subchapter III of
such chapter, to the survivor annuity described in section
8435(c) of such title; and
"(5) the fund referred to in subsections (c)(3XA) and (cX3XB) of
such section shall be deemed to refer?
"(A) in the case of an annuity under subchapter II or V of
chapter 84 of title 5, United States Code, to the Civil Service
Retirement and Disability Fund; and
"(B) in the case of an annuity under subchapter III of
such chapter, the Thrift Savings Fund established by sec-
tion 8437 of such title.
"(f) A reduction in the annuity of an officer or employee of the
Agency to provide a survivor annuity or survivor annuities under
this section shall be computed as provided in section 8419(a) of
title 5, United States Code.
"(g) The entitlement of a former spouse to a portion of an annuity
of a retired officer or employee of the Agency under this section
shall extend to any supplementary annuity payment that such
officer or employee is entitled to receive under section 8421 of title 5,
United States Code.
50 USC 403 note.
Ante, pp. 517,
565.
"ADMINISTRATIVE PROVISIONS
"SEC. 305. (a) Section 201(c) of this Act shall apply in the adminis- 50 USC 403 note.
tration of chapter 84 of title 5, United States Code, with respect to
officers and employees of the Agency.
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100 STAT. 628 PUBLIC LAW 99-335?JUNE 6, 1986
Ante, p. 625.
50 USC 403 note.
Regulations.
50 USC 403 note.
Ante, p. 517.
Ante, p. 626.
Ante, p. 626.
"(b) Notwithstanding subsection (a), section 8461(e) of title 5,
United States Code, shall apply with respect to officers and employ-
ees of the Agency who are not participants in the Central Intel-
ligence Agency Retirement and Disability System and are not
designated under section 302(a) of this Act.
"REGULATIONS
"SEC. 306. (a) The Director, in consultation with the Director of
the Office of Personnel Management and the Executive Director of
the Federal Retirement Thrift Investment Board, shall prescribe in
regulations appropriate procedures to carry out this title.
"(b) The Director shall submit the regulations prescribed under
subsection (a) to the Select Committee on Intelligence of the Senate
and the Permanent Select Committee on Intelligence of the House
of Representatives before the regulations take effect.
"TRANSITION PROVISIONS
"SEC. 307. (a) The Director shall issue regulations providing for
the transition from the Central Intelligence Agency Retirement and
Disability System to the Federal Employees' Retirement System
provided in chapter 84 of title 5, United States Code, in a manner
consistent with sections 301 through 304 of the Federal Employees'
Retirement System Act of 1986.
"(b) The Director shall submit the regulations prescribed under
subsection (a) to the Select Committee on Intelligence of the Senate
and the Permanent Select Committee on Intelligence of the House
of Representatives before the regulations take effect".
SEC. 507. SPECIAL RETIREMENT ACCRUAL FOR OTHER INTELLIGENCE
PERSONNEL
(a) CERTAIN NATIONAL SECURITY AGENCY PERSONNEL.?SeCtIOD
9(bX1X13) of the National Security Agency Act of 1959 (50 U.S.C. 402
note) is amended by inserting before the semicolon the following:
"(including special retirement accrual in the same manner provided
in section 303 of the Central Intelligence Agency Retirement Act of
1964 for Certain Employees (50 U.S.C. 403 note))".
(b) CERTAIN DEFENSE INTELLIGENCE AGENCY PERSONNEL.?Section
1605(a) of title 10, United States Code, is amended by adding at the
end thereof the following: "The Secretary may also provide to any
such civilian personnel who are subject to chapter 84 of title 5,
special retirement accrual benefits in the same manner provided for
certain officers and employees of the Central Intelligence Agency in
section 303 of the Central Intelligence Agency Retirement Act of
1964 for Certain Employees (50 U.S.C. 403 note).".
TITLE VI MISCELLANEOUS PROVISIONS
SEC. 601. ANNUITIES FOR SURVIVORS OF DISTRICT OF COLUMBIA JUDGES.
(a) AMENDMENTS TO DISTRICT OF COLUMBIA CODE.?(1) Subsections
(a) and (b) of section 11-1567 of title 11 of the District of Columbia
Code are each amended by striking out "3 per centum" each place it
appears and inserting in lieu thereof "3.5 percent".
(2XA) Subsection (a) of section 11-1568 of title 11 of the District of
Columbia Code is amended by striking out "computing a survivor
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r u tsidu LAW UU-63b?JUNE 6, 1986 100 STAT. 629
Lannuity" and inserting in lieu thereof "any provision of this sub-
chapter which refers to this subsection".
(B) Subsection (c) of section 11-1568 of title 11 of the District of
Columbia Code is amended?
(i) in paragraph (2XB), by striking out "the lesser of (i) $2,700
per year divided by the number of such children or (ii) $900"
and inserting in lieu thereof "the lesser of (i) $8,424 per year
divided by the number of such children or (ii) $2,808";
(ii) in paragraph (3), by striking out "the lesser of (A) $3,240
per year divided by the number of children or (B) $1,080" and
inserting in lieu thereof "the lesser of (A) $10,110 per year
divided by the number of such children or (B) $3,370";
(iii) by inserting before the first sentence of the matter follow-
ing paragraph (3) the following:
"For the purpose of computing, under this subsection, the annuity of
a child that commences on or after January 1, 1987, the figures
$8,424, $2,808, $10,110, and $3,370 (provided in paragraphs (2) and
(3)) shall be increased by the total percentage of the increases
allowed and in force with respect to retirement salaries of judges
under section 11-1571(a) of this title on or after such date."; and
(iv) in the first sentence of the matter following paragraph (3)
by striking out "remarriage" and inserting in lieu thereof
"upon remarriage prior to the attainment of fifty-five years of
age".
(C) Subsection (e) of section 11-1568 of title 11 of the District of
Columbia Code is amended to read as follows:
"(e) The annuity of a widow or widower of a judge or retired judge
who elected a survivor annuity shall be equal to?
"(1) in the case of a judge who dies while in active regular
service as a judge, the greater of?
"(A) 55 percent of the retirement salary the judge would
have been entitled to receive (as computed under section
11-1564) if the judge had retired on the day before the date
of death (without regard to the age requirements prescribed
in section 11-1562(b)), or
"(B) 55 percent of the retirement salary the judge would
have been entitled to receive (as computed under section
11-1564) if the judge had retired on the day before the date
of death with 15 years of service for the purposes of this
subchapter (without regard to the age requirements pre-
scribed in section 11-1562(b)); and
"(2) in the case of a retired judge, 55 percent of the retirement
salary payable to such judge on the day before the date of the
judge's death.".
(b) APPLICATION OF AMENDMENTS.?The benefits conferred by sec-
tion 11-1568 of title 11 of the District of Columbia Code, by reason of
the amendments made by subsection (a) shall apply to individuals
eligible for annuities under such sections on or after the date of the
enactment of this Act, except that?
(1) such annuities shall be computed in accordance with the
provisions of such section, as amended by subsection (a), not-
withstanding contributions or deposits made in accordance with
applicable law at lower rates; and
(2) no additional liability shall be created with respect to
deposits made in accordance with applicable law before the date
of the enactment of this Act, or after such date pursuant to an
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100 STAT. 630 PUBLIC LAW 99-335--JUNE 6, 1986
installment payment election made under section 11-1567(b) of
title 11 of the District of Columbia Code, before such date.
(c) OPPoRTuNiTY TO REVOKE A PREVIOUS SURVIVOR ANNUITY ELEC-
n0N.?(1XA) Any individual who, before the date of the enactment
of this Act, made an election under section 11-1566 of title 11 of the
District of Columbia Code, to come within the purview of the
survivor annuity provisions of subchapter III of chapter 15 of such
title may revoke that election. Such a revocation shall constitute a
complete withdrawal from the survivor annuity program provided
for in such subchapter.
(B) A revocation under subparagraph (A) shall be submitted in
writing to the Mayor of the District of Columbia.
(2) A revocation under paragraph (1) shall be effective on the day
it is received by the official referred to in subparagraph (B) of such
paragraph.
(3XA) On the effective date of a revocation under paragraph (1),
any right to survivor benefits (to which the revocation relates) for
the survivors of the individual who makes the revocation shall
terminate, and all amounts credited to the account of such individ-
ual under section 11-1570(c) of title 11 of the District of Columbia
Code, together with interest computed as provided in subparagraph
(B), shall be returned to that individual in a lump-sum payment.
(B) For the purpose of subparagraph (A), interest shall be com-
puted in accordance with section 11-1561(10XC) of title 11 of the
District of Columbia Code.
(4XA) Any individual who makes a revocation under paragraph (1)
and who thereafter becomes eligible to make an election under
section 11-1556 of title 11 of the District of Columbia Code, may
make such election only if such individual redeposits, to the credit of
the District of Columbia Judge's Retirement Fund referred to in
section 11-1561(4) of such title, the full amount of the lump-sum
payment made to such individual under paragraph (4), together with
interest.
(B) For the purpose of subparagraph (A), interest shall be com-
puted at 3 percent per annum, compounded on December 31 of each
year from the date of the lump-sum payment referred to in such
subparagraph until the date on which the amount referred to in
such subparagraph is redeposited under such subparagraph.
(d) ADDITIONAL OPPORTUNITY TO MAKE A SURVIVOR ANNUITY ELEC-
TION.?(1) Any individual who, on or before the date of the enact-
ment of this Act, has not made an election under section 11-1566(a)
of title 11 of the District of Columbia Code, to come within the
purview of the survivor annuity provisions of subchapter III of
chapter 15 of such title and is no longer entitled to make such an
election may make such an election. Any such election shall be
submitted in writing to the Mayor of the District of Columbia.
(2) An election under paragraph (1) shall be effective on the day it
is received by the official referred to in such paragraph.
(e) PERIOD FOR EXERCISE OF RIGHT TO REVOKE OR ELECT.?The right
to revoke an election under subsection (d) or to make an election
under subsection (e) is irrevocably waived if not exercised within 180
days after the date of the enactment of this Act.
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PUBLIC LAW 99-335?JUNE 6, 1986 100 STAT. 631
,4
TITLE VII-AUTHORIZATION OF
APPROPRIATIONS; EFFECTIVE DATES
SEC. 701. AUTHORIZATION OF APPROPRIATIONS FOR CERTAIN EXPENSES
OF THE FEDERAL RETIREMENT THRIFT INVESTMENT
MANAGEMENT SYSTEM.
(a) TEMPORARY ALTERNATIVE FUNDING.?Notwithstanding section
8434(cX3) of title 5, United States Code (as added by section 101 of
this Act), the expenses incurred in the administration of the Federal
Retirement Thrift Investment Management System under sub-
chapter VII of chapter 84 of such title (as so added) during fiscal Ante, p. 577.
years 1986 and 1987 shall be paid from sums appropriated pursuant
to subsection (b).
(b) AUTHORIZATION OF APPROPRIATIONS.?There are authorized to
be appropriated to the Federal Retirement Thrift Investment Board,
for fiscal years 1986 and 1987, such sums as may be necessary to pay
the expenses incurred in the administration of the Federal Retire-
ment Thrift Investment Management System during such fiscal
years.
SEC. 702. EFFECTIVE DATES. 5 USC 8401 note.
(a) IN GENERAL.?Except as provided in subsection (b), this Act
and the amendments made by this Act shall take effect on
January 1, 1987.
(b) ExcErrioNs.?(1) Subchapter VII of chapter 84 of title 5, United
States Code, as added by section 101 of this Act, shall take effect on
the date of the enactment of this Act.
(2) Except as provided in section 305 of this Act, title III of this
Act, and the amendments made by such title, shall take effect on the
date of the enactment of this Act.
(3) The amendments made by sections 204 and 205 of this Act shall
take effect on the date of the enactment of this Act.
(4) Section 701 of this Act shall take effect on the date of the
enactment of this Act.
(5) Sections 505 and 601 of this Act and the amendments made by
such section 601 shall take effect on the date of the enactment of
this Act.
(D) FIRST COST-OF-LIVING ADJUSTMENT.?(1) For purposes of the
first adjustment under subsection (b) of section 8462 of title 5,
United States Code (as added by section 101 of this Act), the base
quarter ending on September 30, 1986, shall be considered to have
been the base quarter for a year in which an adjustment under such
subsection was made.
5 USC 8472 note.
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100 STAT. 632 PUBLIC LAW 99-335?JUNE 6, 1986
(2) As used in paragraph (1), the term "base quarter" has the
meaning provided by section 8462(aX1) of title 5, United States Code
(as added by section 101 of this Act).
Approved June 6, 1986.
LEGISLATIVE HISTORY?H.R. 2672 (S. 1527):
HOUSE REPORT No. 99-606 (Comm. of Conference).
SENATE REPORTS: No. 99-166 accompanying S. 1527 (Comm. on Governmental
Affairs) and No. 99-302 (Comm. of Conference).
CONGRESSIONAL RECORD:
Vol. 131 (1985): July 8, considered and passed House.
Nov. 7, considered and passed Senate, amended, in lieu of S.
1527.
Vol. 132 (1986): May 20, Senate agreed to conference report.
May 22, House agreed to conference report.
WEEKLY COMPILATION OF PRESIDENTIAL DOCUMENTS: Vol. 22, No. 23(1986):
June 6, Presidential statement.
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