House Passes Federal Retirement Reform BillThe House on April 1 passed H.R.1804, the Federal Retirement Reform Act of 2009, which, among other things, would allow employees enrolled in the Federal Employees Retirement System (FERS) to count unused sickleave in the calculation of their retirement annuities.Currently, FERS employees often try to use up sick leave immediately prior to retirement because there is no incentive for them to save it up. Civil Service Retirement System (CSRS) employees already receive credit for unused sick leave.The bill also contains a provision to allow FERS employees who leave the federal government to redeposit annuityfunds if they return to federal service. Currently, those employees either may cash out their annuity or roll it into a private account.But if they return to federal employment, they are not allowed to redeposit those funds—andthey lose credit for prior years for service for the purpose of determining annuity benefits.The bill lets returning FERS employees reinvest their full federal retirement annuity without losing credit for previous years of service.“We are encouraged that this bill not only provides FERS employees with a credit for unused sick leave, but thatit also places these employees on par with their CSRS counterparts,” said Federal Managers Association NationalPresident Darryl Perkinson. “This is a commonsense bill strengthening the civil service retirement system and I urge swift action by the Senate.”H.R. 1804 also contains provisions affecting the Thrift Savings Plan (TSP). Under the bill, all new federal employees would be enrolled in the TSP automatically when they begin employment. Additionally, the bill also establishes within the TSP a Roth IRA option for federal employees. National Active and Retired Federal Employees Association (NARFE) President Margaret L. Baptiste praised the efforts of key lawmakers—including Reps. James Moran, D-Va., Edolphus Towns, D-N.Y., chairman of the House Committee on Oversight and Government Reform, and Stephen Lynch, D-Mass., chairman of the Subcommittee on the Federal Workforce—for their work on the FERS sick leave issue and other aspects of the bill. Baptiste also lauded the automatic TSP enrollment initiative, which she said will boost the percentage of feds who make use of the TSP to ensure they are better prepared their retirement. And the Roth IRA provision, she said, will provide federal employees with more of the same options available to private-sector workers in some 401 (k) plans.To see more, go to: www.fedmanagers.org/public/announcement.cfm?id=306 , or to www.narfe.org.
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