OFFICE OF PERSONNEL MANAGEMENT DRAFT BILL, "TO AMEND TITLE 5, UNITED STATES CODE, TO IMPROVE THE COMPENSATION FOR MEMBERS OF THE SENIOR EXECUTIVE SERVICE, AND FOR OTHER PURPOSES.

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90M00005R001400010037-1
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 15
• Document Creation Date: December 27, 2016
• Document Release Date: October 17, 2012
• Sequence Number: 37
• Publication Date: August 11, 1988
• Content Type: LETTER

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OCA 273],-88
OFFICE OF CONGRESSIONAL AFFAIRS
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ACTION
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3. DD/Senate Affairs
4. Ch/Senate Affairs
5. DD/House Affairs
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8. FOIA Officer
Constituent Inquiries
9. Officer
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11.
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ACTION
INFO
1. D/OCA
2. DD/Legislation
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3. DD/Senate Affairs
4. Ch/Senate Affairs
5. DD/House Affairs
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7. Admin Officer
8. FOIA Officer
Constituent Inquiries
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OFFICE OF CONGRESSIONAL AFFAIRS
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EXECUTIVE OFFICE OF THE PRESIDENT
OFFICE OF MANAGEMENT AND BUDGET
WASHINGTON, D.C. 20503
August 11, 1988
LEGISLATIVE REFERRAL MEMORANDUM
OCA 2731-88
TO: Legislative Liaison Officer -
National Science Foundation-Charles Herz-357-9435
Department of Agriculture-Marvin Shapiro-382-1516
Department of Commerce-Michael Levitt-377-3151
Department of Defense-Sam Brick-697-1305
Department of Education-Jack Kristy-732-2670
Department of Energy-Bob Rabben-586-6718
Department of Health and Human Services-F White-245-7760
Department of Housing and Urban Development-E. Murphy-
755-7093
Department of the Interior-Philip Kiko-343-6706
Department of Justice-John Bolton-633-2141
Department of Labor-Seth Zinman-523-8201
Department of State-Bronwyn Bachrach-647-4463
Department of Transportation-Tom Herlihy-366-9293
Department of the Treasury-Rick Carro-566-8523
Veterans Administration - Donald Ivers - 233-3832
Central ntelligence,Age_ncy~
Environmental Protection Agency-A.H. Schilling-382-5414
General Services Administration-Al Vicchiolla-566-0563
National Aeronautics and Space Administration-J. Murphy-
453-1948
SUBJECT: Office of Personnel Management draft bill, "To amend
title 5, United States Code, to improve the compensation
for members of the Senior Executive Service, and for-
other purposes."
The Office of Management and Budget requests the views of your
agency on the above subject before advising on its relationship
to the program of the President, in accordance with OMB
Circular A-19.
A response to this request for your views is needed no later than
Wednesday, August 24, 1988.
Questions should be referred to Hilda Schreiber (395-7362), the
legislative analyst in this office.
~t~. X~,
Naomi R. Sweeney for
Assistant Director for
Legislative Reference
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tr ,
r rt, r UNITED STATES
`. 1 OFFICE OF PERSONNEL MANAGEMENT
`09 WASHINGTON, D.C. 20415
Office of the Director
Honorable George Bush
President of the Senate
Washington, D.C. 20510
The Office of Personnel Management submits herewith a legis-
lative proposal, "To amend title 5, United States Code, to
improve the compensation for members of the Senior Executive
Service, and for other purposes." We request that this pro-
posal be referred to the appropriate committee for early con-
s ideration.
On April 10, 1987, President Reagan established the President s
Commission on Compensation of Career Federal Executives. That
Commission, in its report this year, has recommended several
changes in the laws governing compensation for the Senior
Executive Service (SES). (A copy of the Commission's report,
explair2ing these changes, is enclosed.) This legislative
proposal would implement several of these changes.
At the outset, it should be noted that this proposal does not
increase basic pay for the SES. The Compensation Commission
recommended substantial increases in SES pay, both in absolute
terms and in relation to the pay rates for the Government's
senior elective and appointive officials. While we believe the
Government's pay rates for its high-level officials are seri-
ously inadequate, we do not think career executive pay should
be decoupled from political executive pay, an action which
would result in career senior executives, as a general rule,
being paid more than the Executive Schedule appointees to whom
they report. In our view, it is vitally important to attract
highly qualified political leadership, as well as competent
senior career executives. A policy which strengthens career,
but not political, executive pay would likely undermine the
stature and authority of Presidential appointees and provide a
disincentive to their accepting such appointments. Therefore,
in our view, the next Quadrennial Commission should consider
pay increases large enough to accommodate an SES increase of
some magnitude, while retaining the current relationship
between the SES and the Executive Schedule.
However, with respect to the Compensation Commission's other
legislative recommendations, we believe the case is clear that
action should be taken immediately.
CON 161-64-4
May 1966
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Honorable George Bush
First, the Commission has recommended that the SES bonus pool
be increased from 3 percent to 10 percent of the aggregate
career SES payroll, and that four-tenths of this expanded pool
be available for the payment of recruitment and retention
bonuses to help agencies compete in the labor market for scarce
executive talent. Such bonuses would also be -useful in
encouraging SES members to relocate to high-cost areas.
Second, the Commission recommended that SES Presidential Rank
Awards be increased in value. The dollar amount of these
awards was set by statute in 1978, at $20,.000 for the Distin-
guished Executive Award and $10,000 for the Meritorious Execu-
tive Award. Since that time, inflation has eroded the value of
those awards. Accordingly, the Commission recommended that
these awards be set equal to 40 percent and 20 percent, respec-
tively, of the highest SES pay rate. Under the current SES pay
schedule, this change would increase the Rank Awards to $31,000
and $15,500, respectively, and these amounts would increase
automatically in the future whenever SES pay increases.
Third, the Commission recommended eliminating the current
provision of law that limits the aggregate compensation any SES
member can receive in any fiscal year to the rate for level I
of the Executive Schedule, now $99,500. Since fiscal year
1985, SES members whose compensation has reached this ceiling
have been permitted to carry forward the excess and be paid it
in a subsequent fiscal year, so eliminating this ceiling would
really only permit the earlier payment of amounts that would be
paid anyway, thus simplifying the administration of SES pay.
Fourth, the Commission recommended changing the current provi-
sions of law concerning SES annual leave accumulation. Under
current law, SES members may accumulate leave without limit,
carrying it over from year to year until they separate from the
Government, at which time they receive a lump-sum payment for
the unused leave. The Commission recommended that SES members
be permitted to receive each year a lump-sum payment for annual
leave they have accumulated over 120 hours, thus permitting
them to receive this payment as current rather than deferred
compensation.
The enclosed bill would accomplish those four recommendations,
and we urge its enactment. We believe that these four changes
will make SES compensation significantly more attractive, and
will be very helpful in enabling the Government to recruit and
retain a Senior Executive Service of the highest caliber.
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Honorable George Bush 3
.The Office of Management and Budget advises that, from the
standpoint of the Administration's program, there is no objec-
tion to the submission of this proposal.
A similar letter is being sent to the President of the Senate.
Sincerely,
Constance Horner
Director
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To amend title 5, United States Code, to improve the
compensation for members of the Senior Executive Ser-
vice, and for other purposes.
Be it enacted by the Senate and House of Representatives
of the United States of America in Congress assembled, That
this Act may be cited as the "Senior Executive Service Com-
pensation Amendments of 1988".
Sec. 2. Section 4507(e) of title 5, United States Code,
is amended--
(1) in paragraph (1), by striking out "of $10,000"
and inserting in lieu thereof "equal to 20 percent of
the maximum rate paid under section 5382 of this title,
rounded to the next higher $100"; and
(2) in paragraph (2), by striking out "of $20,000"
and inserting in lieu thereof "equal to 40 percent of
the maximum rate paid under section 5382 of this title,
rounded to the next higher $100".
Sec. 3. Section 5383 of title 5, United States Code, is
amended by striking out subsection (b), and by redesignating
subsections (c) and (d) as subsections (b) and (c), respec-
tively.
Sec. 4. (a) Section 5384 of title 5, United States
Code, is amended to read as follows:
"?5384. Performance, recruitment, and retention awards in
the Senior Executive Service
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"(a)(1) To encourage excellence in performance by career
appointees and to aid in the recruitment and retention of
career appointees with exceptional qualifications or for
difficult-to-fill positions, awards shall be paid to career
appointees in accordance with the provisions of this sec-
tion.
"(2) Such awards shall be paid in a lump sum and shall
be in addition to the basic pay paid under section 5382 of
this title or any award paid under section 4507 of_ this
title.
"(b)(1) No award under this section shall be paid to any
career appointee whose performance was determined to be less
than fully successful at the time of the appointee's most
recent performance appraisal and rating under subchapter II
of chapter 43 of this title.
"(2) The amount of an award under this section shall be
determined by the agency head but may not be less than 5
percent nor more than 20 percent of the career appointee's
rate of basic pay. A career appointee may be paid both a
performance award and a recruitment or retention award in the
same fiscal year.
"(3) The aggregate amount of awards paid under this
section by an agency during any fiscal year may not exceed
the greater of--
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"(A) an amount equal to 10 percent of the aggregate
amount of basic pay paid to career appointees in such agency
during the preceding fiscal year; or
"(B) an amount equal to 15 percent of the average
of the annual rates of basic pay paid to career appoin-
tees in such agency during the preceding fiscal year.
"(4) Of the amount determined under paragraph (3) of
this subsection, an agency may pay not to exceed four-tenths
in recruitment or retention awards in accordance with subsec-
tion (d) of this section.
"(c) Awards paid by any agency under this section on the
basis of performance shall be based on recommendations by
performance review boards established by such agency under
section 4314 of this title.
"(d)(1) In order to recruit or retain a career appointee
with exceptional qualifications or for employment in a
difficult-to-fill position, an agency may pay an award to
such appointee in accordance with such criteria and guide-
lines as the Office of Personnel Management may provide.
"(2) An award may be paid to a career appointee under
this subsection only if the career appointee enters into a
service agreement with the agency under which the career
appointee agrees to complete one year of service with the
agency. If the career appointee voluntarily, or because of
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misconduct, fails to complete the year of service, the career
appointee shall be required to repay the full amount of this
award, unless the head of the agency determines that such
repayment should be waived, in whole or in part, because of
extenuating circumstances beyond the control of the career
appointee. If the career appointee is separated involun-
tarily by the agency, other than for misconduct, before the
year of service is completed, no repayment may be required.
"(e) The Office of Personnel Management may issue guid-
ance to agencies'concerning the proportion of Senior Execu-
tive Service salary expenses that may be appropriately
applied to payment of awards and the distribution of
awards.".
(b) The item relating to section 5384 in the analysis
for chapter 53 of title 5, United States Code, is amended to
read as follows:
"5384. Performance, recruitment, and retention awards in
the Senior Executive Service.".
Sec. 5. (a) Subchapter VI of chapter 55 of title 5,
United States Code, is amended by adding at the end thereof
the following new sections:
"5553. Lump-sum payment for accumulated and accrued leave
for members of the Senior Executive Service
"A member of the Senior Executive Service is entitled to
receive a lump-sum payment for all or any portion of any
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accumulated and current accrued annual leave to such member's
credit in excess of 120 hours, if the member applies to
receive such payment during an annual application period to
be prescribed by the Office of Personnel Management for such
purpose.
"5554. Regulations
"The Office.of Personnel Management may prescribe regu-
lations necessary for the administration of this sub-
chapter.".
(b) The analysis for chapter 55 of title 5, United
States Code, is amended by inserting after the item relating
to section 5552 the following new items:
"5553. Lump-sum payment for accumulated and accrued leave
for members of the Senior Executive Service.
"5554. Regulations.".
Sec. 6. (a) The amendments made by this Act shall take
effect on October 1, 1988, but any authority to make payments
under any amendment made by this Act shall be effective only
to such extent or in such amounts as are provided for in
advance by appropriation Acts.
(b) The Office of Personnel Management may prescribe
regulations limiting the number of hours of annual leave for
which a member of the Senior Executive Service may receive a
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lump-sum payment each year. Such regulations shall remain in
effect until such date'as the office may provide, but not
later than September 30, 1993. _
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to accompany a bill
To amend title 5, United States Code, to improve the
compensation for members of the Senior Executive Ser-
vice, and for other purposes.
The first section of the bill provides a short title, the
"Senior Executive Service Compensation Amendments of 1988."
Section 2 amends section 4507 of title 5, United States Code,
to increase the value of Presidential Rank Awards. The value
of Meritorious Executive Awards would be increased from
$10,000 to 20 percent of the maximum SES pay rate, rounded to
the next higher $100. (Under current SES rates, the resul-
tant amount would be $15,500.) The value of Distinguished
Executive Awards would be increased from $20,000 to 40 per-
cent of the maximum SES pay rate, rounded to the next higher
$100. (Under current SES rates, the resultant award would be
$31,000.)
Section 3 would repeal subsection (b) of section 5383 of
title 5, United States Code, eliminating the Executive Sched-
ule level I limitation on aggregate compensation for SES
members.
Section 4 would amend section 5384 of title 5, United States
Code, concerning SES performance awards. In addition to
performance-based awards, agencies would be permitted to pay
awards to SES career appointees with exceptional qualifi-
cations or for difficult-to-fill positions, in accordance
with criteria and guidelines issued by the Office of Person-
nel Management. Such an award might also, for instance, be
paid to encourage an SES member to relocate. A recipient of
a recruitment or retention award would have to agree to serve
for at least a year. If he or she failed to do so, the award
would have to be repaid unless the agency waived repayment
because of extenuating circumstances.
Section 4 would also increase the funds available for SES
awards from 3 percent of each agency's career SES payroll to
10 percent. Up to four-tenths of this increased award pool,
would be available for recruitment or retention awards.
Section 5 of the bill would add a new section 5553 to title
5, United States Code. This new section would permit SES
members to apply for and receive each year a lump-sum payment
for all or any part of the annual leave to their credit in
excess of 120 hours.
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This election would be made during an annual election period
to be established by the Office of Personnel Management.
Section 5 would also add a new section 5554, permitting the
Office to issue regulations on lump-sum payments for unused
annual leave, under the new section 5553 and under current
law, where no. regulatory authority currently exists.
Section 6 of the bill would provide that the bill's provi-
sions would be effective on October 1, 1988, but only to the
extent funds are otherwise available. The Office of Person-
nel Management would be permitted to issue regulations limit-
ing lump-sum payments for annual leave for the first five
years after enactment.
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