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NARFE Hotline 9/16/97

NARFE Legislative Hotline is generally recorded Fridays if Congress is in session for telephone callers to 1-202/234-0503 and available on the Internet at http://www.narfe.org

Hello and welcome to the NARFE Legislative HOTLINE recorded by Chris Farrell on Friday, September 26th. Campaign finance reform, the status of appropriation bills and pending priority legislation will be covered. The next scheduled HOTLINE is October 3rd.

Today the Senate is debating the merits and demerits of the current system of financing congressional elections. Senators McCain and Feingold will offer a version of their reform measure, S. 25. The House is sticking to appropriation bills amid dilatory tactics by minority Democrats and the Speaker's support for removing the current limits on contributions to Congressional candidates. Sunday network television news programs are likely to discuss these issues.

As the beginning of the new fiscal year looms, only 3 of 13 appropriation bills have been cleared for the President. Senate Minority Leader Daschle indicates a continuing resolution is likely to be considered that would last until October 23rd. No one wants even a partial government shutdown!

NARFE had a successful budget cycle but we should not relax. Here is the way to stay engaged. Even if unaffected personally by the Government Pension Offset, each NARFE member should use the September issue of Retirement Life, pages 10 and 11, to prepare a postcard or letter pressing their own Representative to cosponsor and work for passage of H.R. 2273, the Government Pension Offset bill. Your phone calls and correspondence are the key! Due to NARFE member efforts 7 cosponsors were added September 24th. NARFE's Government Pension Offset bill now has 76 cosponsors.

Similarly, NARFE's "off budget" legislation, H.R. 107, needs more than the current 93 cosponsors. October 12th through 19th will be an ideal time to meet your Representatives and Senators during the Columbus Day Work Period! Start planning a group visit with your Representative during that week. Contact your Representative's local office now to schedule that group visit. Face to face meetings can establish a relationship that may prove vital in the future.

Thank you for calling. The Hotline is available by both E-mail and on NARFE's web page on the Internet. All are services of the National Association of Retired Federal Employees.


Subject: NARFE Hotline 9/5/97

Hello and welcome back to a NARFE Legislative HOTLINE recorded Friday, September 5th. This brief message will deal with Congress' current agenda and encourage NARFE members to lobby their Representatives to cosponsor NARFE priority legislation. The next scheduled HOTLINE is September 12th.

While Washington imitated Paris during August, Congress is now back in town. All of September will be consumed by floor consideration of the 13 regular appropriations bills. A continuing resolution may become necessary if any of these bills are not completed by September 30th. Campaign finance abuses and reform legislation will get considerable coverage. Congress will attempt to override President Clintoin's first use of the line item veto authority.

NARFE members should. turn their attention to pending legislation endorsed by NARFE delegates at the 1996 convention in Houston. The September issue of Retirement Life explains newly introduced legislation to amend the Social Security Government Pension Offset. The bill, H.R. 2273, was introduced by Rep. Jefferson with 51 original cosponsors. Our off budget legislation, H.R. 107, championed by Rep. Bilirakis needs citizen lobbyist action. Your letters and postcards to your own Representative are the one and only way to prove federal retirees are engaged in these issues. Often it takes only a handful of letters, postcards and phone calls to convince a Representative that his or her constituents interests are at stake. Legislators like to say YES. Use September's Retirement Life draft a letter or postcard.

The adjournment target for Congress is the end of October or beginning of November. Both the House and Senate will recess for the week which includes Columbus Day, October 12-19. Start planning a group visit with your Representative during that week. Face to face meetings can establish a relationship that may prove vital in the future.

Thank you for calling. The Hotline is available by both E-mail and on NARFE's web page on the Internet. All are services of the National Association of Retired Federal Employees.


Waiting for January

Monday, August 18, 1997; Page B02

With two months left to go in the countdown process, most federal retirees are in line for at least a 1.9 percent cost-of-living adjustment effective in January 1998. The adjustment, which also goes to retired military personnel and people getting Social Security checks, will be higher if inflation rises in August and September.

There are about 300,000 former federal workers, military retirees and survivors in the Washington area. When you say COLA in this town, people usually don't think of Pepsi or Coke. They think of that monthly benefit check.

Benefits for federal and military retirees are indexed to inflation. They are supposed to get annual adjustments each January to help keep pace with living costs. Most private-sector pensions are not indexed to inflation.

Federal and military adjustments are based on the increase in living costs, as measured by the Consumer Price Index, from the third quarter of the current year over the third quarter of the previous year. That's why the full amount of the 1998 adjustment won't be known until August and September inflation data is available.

Those who retired under the old Civil Service Retirement System -- which is 95 percent of all retirees -- get full cost-of-living adjustments regardless of their age.

Those who retired under the newer Federal Employees Retirement System (which covers most people hired after 1983) are under a different adjustment formula. They do not get any inflation adjustment until they reach age 62. At that point, if the inflation index produces a 2 percent raise, they get the full amount. But if the rate of inflation is between 2 percent and 3 percent, these retirees get only a 2 percent adjustment. If it is 3 percent or more, they get a raise that is 1 percent less than the rise in the Consumer Price Index.

Federal Pay Raises

Unlike federal retirees, active-duty feds don't get cost-of-living adjustments. Their January pay raises are based on catch-ups with industry, but more often they are determined by budgetary and political considerations.

For example, the 1990 federal pay law -- passed by a Democratic Congress and signed by a Republican president -- promised to narrow the purported pay gap between government and industry over the next decade. That was to be accomplished by a series of dual annual raises, both payable each January.

One increase was a national adjustment that would go to all white-collar federal employees. The second was to be a locality adjustment based on local labor wage changes in various cities from Washington to Houston and Seattle.

But Clinton administration officials balked at paying the full amount of the raises because they think the data collected by the government -- which compares salaries for selected jobs -- don't give the full pay picture.

They believe it would be fairer to compare "total compensation," which includes both wages and fringe benefits. For that reason, the White House has shaved each pay raise due under law since the Clinton administration took over.

This year, the White House budget proposed delaying civilian retiree cost-of-living adjustments (but not those for military retirees or Social Security recipients) until April of each year.

But Congress shot down the plan, thanks to heavy lobbying from federal and postal unions and the 500,000-member National Association of Retired Federal Employees.

King of Perks

Many private-sector employees believe that working for Uncle Sam equals a ride on the world's best fringe benefit gravy train. But many feds look with envy on real (and perceived) benefits available to workers in industry.

For a look at who gets it best, check this space tomorrow.


New Formula, Old Answer

Thursday, August 14, 1997; Page D02

This is the story of the meteor that didn't plow into your back yard. It's about one of the many legislative bullets that feds and retirees dodged this year, thanks to big-time lobbying by groups representing them, and key politicians who butted heads with Republican budget-cutters and the White House. It is a classic example of creative math, Washington-style.

First, health insurance premiums -- reflecting benefit changes and medical inflation -- will go up next year for many federal workers and retirees.

But the increases, which will be announced within the next several weeks, won't be nearly as high as they might have been.

Fortunately for the nearly 10 million people covered by the federal health insurance program, a bipartisan congressional effort earlier this year scuttled a move to decrease the government share of health premiums -- which would have raised the price tag each year for workers and retirees.

The giant Federal Employees Health Benefit program covers about half the people in the Washington area, ranging from Vice President Gore and family to the former spouses of some feds and retirees. It provides cradle-to-grave coverage for federal families, who pay about 29 percent of their plans' total premiums.

President Clinton's budget proposal assumed there would be a change in the current premium-setting formula. The change would have meant that premiums for self-only plans would go up $164 a year and that those for family plans would increase $326, in addition to any normal premium increases.

But some new math and old-style political compromise produced a "change" in premium-sharing that produces the same result as before. It could happen only in Washington.

Here's the best explanation (still tough to understand), taken from the August issue of the National Association of Retired Federal Employees magazine:

"The House and Senate budget bills contain the `Fair Share' proposal that will maintain the current premium sharing ratio between government and enrollees" by using a different formula.

That change satisfies budget-reformers, but it means that the government will continue to pay the same 71 percent of premiums, with employees and retirees continuing to pay 29 percent of the premium each year.

As NARFE points out, "Sen. Thad Cochran (R-Miss.) and Reps. Steny Hoyer (D-Md.), Connie Morella (R-Md.) and Elijah Cummings (D-Md.) worked with the Office of Personnel Management, NARFE and other federal and postal organizations to write the new Fair Share formula." It uses an equally complicated formula to determine the government's and employee's or retiree's share of the premium. But the end result, if everybody's math is correct, will be the same: OPM actuaries say the premium split, 71 percent government and 29 percent employee, will remain the same.

Bottom line: The system that budget-cutters wanted to change, which guaranteed the federal share of premiums, has been changed. But it has changed to a new system guaranteeing that Uncle Sam -- using a different formula -- will continue to pay 71 cents of every premium dollar.

If you are confused, welcome to the club. So are the budget-cutters who got rolled in the process. They won the battle and lost the war. For feds and retirees, it is a win-win situation. For once, they came out on top in the Washington numbers game. When you pay those higher health premiums next year (and not all plans are going up), remember: It could have been much worse.

Special NARFE Note: NARFE Hq. reported today that the BLS announced this morning that the July CPI-W rose 0.1 percent, to an index of 157.5. This latest CPI figure is 1.9 percent higher than the 1996 third quarter average base index of 154.6, used for computng the next COLA in retirement benefits. If recent inflation trends continue the next two months, the COLA in next January's retirement checks will be just over 2 percent.

For former federal workers receiving FECA benefits, with COLAs determined by the calendar year hike in CPI-W, this index has risen 1.0 percent through the first seven months of 1997 (as compared to a 2.3 percent increase the first seven months of 1996). -- Don Geoffrion


Holding Even

Wednesday, August 13, 1997; Page B02

Nearly half a million retired federal workers get annuities that are bigger than their salaries were when they retired, thanks to the inflation-protection feature of the government's retirement system. According to the General Accounting Office, the typical retiree has been retired 22 years and has received 26 cost-of-living adjustments. The GAO says the $40 billion spent on civil service retirement benefits in fiscal 1996 made the system the seventh-largest mandatory federal spending program.

But GAO auditors say that no retiree is "receiving a pension that was larger than his or her final salary" once salaries are adjusted for inflation. In other words, the former feds have kept pace, more or less, with inflation but haven't done better financially than when they were working.

The inflation-indexing feature of the retirement system is one of the items looked at in a new GAO report prepared for Sen. Ted Stevens (R-Alaska). The federal retirement plans cover 2.8 million active-duty workers, 1.7 million retirees and 600,000 survivors.

Most retirees are under the old Civil Service Retirement System. But most active-duty feds are under the Federal Employees Retirement System. FERS replaced CSRS in 1984.

CSRS is considered a "stand-alone" program. That means employees get their primary benefit -- a government annuity -- from the retirement system, to which they contribute 7 percent of their salaries. They pay only the Medicare portion of Social Security and also can contribute up to 5 percent of their pay into the federal 401(k) plan.

FERS, which was designed by Stevens, is more like a private-sector plan. Workers get a smaller civil service benefit (and pay only 0.8 percent into the fund), but they pay into and qualify for Social Security. They also can contribute up to 10 percent of pay to the 401(k) plan and get a 5 percent agency match.

Employees under the CSRS plan are supposed to get full cost-of-living adjustments each year. Those under the FERS system get partial adjustments.

Virtually all of the annuitants studied in the GAO report retired under the CSRS system.

Some highlights from the report:


Subject: NARFE Hotline 7/30/97

Hello and welcome to a special edition of the NARFE Legislative HOTLINE recorded Wednesday, July 30th. Final agreement between the Clinton Administration and Congressional leaders is certain to be ratified by House and Senate votes on July 30th and 31st. A White House signing ceremony is tentatively set for Friday, August 1st. Congress will be in summer recess from August 2nd through Labor Day. The next schedule HOTLINE will be September 8th.

While House and Senate floor action moved a variety of annual appropriation bills toward final passage, Capitol Hill negotiators sealed the budget deals with the White House Chief of Staff, the Treasury Secretary and Congressional liaison John Hilley. The summer recess will be a victory lap for Republicans and Democrats spinning the settlement to their constituents and voters.

For NARFE members and federal retirees the Budget Reconciliation Spending Act Conference Report means COLA Equity -- COLAs on the same timetable as Social Security benefits. Equally importantly, this conference report contains a new and permanent premium-sharing formula for the Federal Employees Health Benefits Program. This formula will protect enrollees from large premium increases that could have occurred with the expiration of the Aetna proxy formula. The Senate-passed means-test of Medicare Part B premiums was dropped, as were the new home health co-pays and the gradual increase in the eligibility age. However, a Medicare commission will be established to report in two years.

Capital gains tax rates and estate tax exemptions will be changed but not indexed. When the Congress returns after Labor Day, completing the 13 regular appropriation bills will dominate the agenda.

Here's what others are saying:

"We gave ground, the administration gave ground, and we found common ground." -- Senate Majority Leader Trent Lott.

"Under a bipartisan shower of rhetorical confetti, final legislative debate begins today on the budget-balancing deal." -- Congressional Quarterly

"This is a lost opportunity that, on balance and in the long run, will likely do a fairly large amount of harm -- the tax cuts -- for relatively little good."

And Ron Pollard of Families USA called the agreement "the most significant advance in funding for health care coverage since the Medicare and Medicaid programs were enacted 32 years ago."

Details in September's Retirement Life.

Judy Park extends a special thank-you to NARFE members who successfully averted COLA delay, FEHBP premium increases, means testing and possible sequestration. Sweet as these victories are, nothing lasts forever, including political victories. President Jackson suggests that NARFE members intercept their Congressman on the victory lap and recruit cosponsors for two House bills. Newly introduced legislation, H.R. 2273, partially repeals the Social Security Government Pension Offset, a long-sought NARFE goal. Our off-budget bill, H.R. 107, has 93 cosponsors and needs more. Information in the August and September issues of Retirement Life.

Thank you for calling. The Hotline is available by both E-mail and on NARFE's web page on the Internet. All are services of the National Association of Retired Federal Employees.


Subject: FedWeek 7/30/97 Excerpts

This Week's FREE Issue Wednesday, July 30, 1997

Editor's Note: Please let your colleagues know about FEDweek.com. As you know, they can sign up for it at our website: http://www.fedweek.com. And itís free. Thanks, Don Mace

Higher Retirement Contributions Survives Negotiations Language requiring higher retirement contributions from agencies and individual employees has survived negotiations between the White House and the congressional leadership. Workers will pay another 0.5 percent of salary phased in over three years beginning in January 1999 under the plan, and agencies eventually will have to kick in a total of 1.5 percent more.

Public Pension Offset Bill Introduced Rep. William Jefferson, D-La., has introduced a bill (HR-2273) that would modify the controversial Public Pension Offset, providing relief for thousands of federal retirees, almost all of them under the older CSRS retirement system. The offset can greatly reduce or wipe out any Social Security benefit received by a federal retiree under CSRS. The bill would exempt any federal retiree whose combined Social Security benefit and civil service annuity is $1200 or less and base the offset only on amounts above $1200 for others. The bill has attracted bipartisan support and has 50 co-sponsors, so far.

Budget Deal Good Deal for Retirees The National Association of Retired Federal Employees generally is pleased with the White House/GOP budget deal, saying that the final package could have been a lot worse for federal and postal retirees. The budget wonít delay COLA payments and thereís language ensuring that retirees under the federal employee health benefits program won't pay higher premiums based on a technical fix in the premium-sharing formula. And three major changes in the Medicare program that NARFE opposed were dropped, as well, from the final package, including means-testing premiums, raising the eligibility age and charging beneficiaries $5 for certain home visits.

Thursday Ends Current TSP Open Season Federal employees who havenít done so already have until the close of business July 31 to participate in the current thrift savings plan open enrollment season. The next regularly scheduled TSP open season begins on November 15. More than half of the federal work force is actively investing in the TSP program.

Back Issues of FEDweek.com Available A reminder: Back issues of FEDweek.com are archived for your convenience on our website (http://www.fedweek.com). Feel free to review them or download them at will. We cover a multitude of topics pertinent to your career.


Summary of Budget-Balancing Deal

Monday, July 28, 1997; 9:28 p.m. EDT

Highlights of the tentative tax and budget-balancing agreements between the Clinton administration and congressional leaders. All figures are over a five-year period unless otherwise indicated.

OVERALL TAX RELIEF:

About $140 billion in overall tax cuts and about $50 billion in tax increases for a net cut of about $91 billion, which is up from $85 billion agreed upon by the administration and Congress earlier this year.

CHILD CREDIT:

A $400-per-child credit beginning next year, rising to $500 in 1999, for children 16 and under. Employers would be notified to adjust withholding starting next year so parents wouldn't have to wait until filing a return and receiving a refund to get some benefit from the new break. Begins to phase out for individuals earning $75,000 and couples making $110,000, higher than President Clinton wanted. Some families earning as little as $18,000 who pay little or no income tax would also qualify, which Republicans had resisted. The extension of the credit to these lower-income families would be partly offset by $5 billion in savings from tightening eligibility for the existing earned-income tax credit for the working poor.

EDUCATION INCENTIVES:

Total price tag of about $40 billion -- $5 billion more than Clinton initially sought. Will be a mix of the tax credits the president proposed, plus incentives for education savings the GOP proposed. For the first two years of college, the maximum credit would be $1,500 (100 percent of the first $1,000 in expenses and 50 percent for the next $1,000). For the second two years of college, the credit would start at 20 percent of $5,000 and phase up over time to 20 percent of $10,000. The current exemption for employer-paid undergraduate tuition would be extended.

TOBACCO TAXES:

The current 24-cent-per-pack federal levy on cigarettes would increase by 10 cents in 2000 and an additional nickel in 2002. The Senate had proposed a 20-cent increase.

CAPITAL GAINS:

Retroactive to May 7, 1997, the capital-gains rates would drop from a maximum 28 percent to 20 percent, and from 15 to 10 percent for the lowest income bracket. Lowest rate would drop to 8 percent for assets bought beginning in 1997 and held five years; top rate would drop to 18 percent for assets bought beginning in 2001 and held five years. Inflation-related portion of capital gains would be taxed, despite GOP effort to exempt it. First $500,000 in gain from the sale of principal residence would be excluded from taxation, but this benefit could be used only once every two years.

IRA AND ESTATE TAX:

More GOP victories with several new Individual Retirement Accounts, although they will be limited to people with incomes of $150,000 or less. People could put money into as many IRAs as they would like, but could invest an annual total of no more than $2,000 overall. New IRAs include letting people qualify even if spouse does not, plus new tax breaks for withdrawals for education and first-time home purchases. On estate taxes, the current individual exemption would rise over 10 years from $600,000 to $1 million, although family-owned businesses and farms would qualify for $1.3 million starting next year.

SELF-EMPLOYED HEALTH INSURANCE:

The deduction for health insurance for self-employed people would increase from 40 percent this year to 80 percent by 2006.

MISCELLANEOUS BUSINESS:

Businesses would get some relief from the corporate alternative minimum tax, a law designed to ensure that profitable companies pay a minimum tax no matter how many deductions they have. Republican provisions making it easier to classify workers as independent contractors were dropped.

CHILDREN'S HEALTH:

Republicans have agreed to provide $24 billion to expand health-care coverage for children, $8 billion more than many of them want. In exchange, Clinton would give states more power than he wanted in deciding exactly what services would be provided.

MEDICARE:

Most of the $115 billion in savings would come from limiting payments to hospitals, doctors and other providers. The monthly Part B premium for doctors' fees would rise somewhat for all beneficiaries. Recipients would be given more choices for coverage beyond the current, predominant fee-for-service system. Gone are three Senate-approved proposals that would have boosted the monthly premiums for higher-income seniors, increased the eligibility age from 65 to 67 and imposed $5 fees for home health-care visits. About 390,000 people would be able to try government-financed medical savings accounts to purchase catastrophic-care insurance in lieu of traditional Medicare.

MEDICAID:

About $13 billion in savings, mostly from lower payments to hospitals. Republicans and Clinton have agreed to provide $1.5 billion to help low-income people pay Medicare premiums.

WELFARE:

Gone is a GOP demand to pay less than the minimum wage to people who move from welfare to subsidized public and nonprofit jobs, and to deny coverage under worker-protection laws. Republicans have agreed to administration demands that welfare coverage be restored for thousands of disabled legal immigrants and children who lost coverage under last year's welfare overhaul.

© Copyright 1997 The Associated Press


For NARFE Netters: Following (courtesy of fellow Netter Lee Gross) is the text of H.R. 2273, the Government Pension Offset (GPO) bill discussed on pages 18 & 20, August Retirement Life. This bill was introduced by Congressman William Jefferson (D-LA). Following the text is a list of initial co-sponsors as of the date the bill was introduced, 7/25/97. .- Don Geoffrion

Subject: HR 2273

HR 2273 IH
105th CONGRESS
1st Session

To amend title II of the Social Security Act to provide that the reductions in social security benefits which are required in the case of spouses and surviving spouses who are also receiving certain Government pensions shall be equal to the amount by which the total amount of the combined monthly benefit (before reduction)

IN THE HOUSE OF REPRESENTATIVES
July 25, 1997

Mr. JEFFERSON (for himself,... ) introduced the following bill; which was referred to the Committee on Ways and Means

A BILL

To amend title II of the Social Security Act to provide that the reductions in social security benefits which are required in the case of spouses and surviving spouses who are also receiving certain Government pensions shall be equal to the amount by which the total amount of the combined monthly benefit (before reduction) and monthly pension exceeds $1,200.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. LIMITATION ON REDUCTIONS IN BENEFITS FOR SPOUSES AND SURVIVING SPOUSES RECEIVING GOVERNMENT PENSIONS.

(a) WIFE'S INSURANCE BENEFITS- Section 202(b)(4)(A) of the Social Security Act (42 U.S.C. 402(b)(4)(A)) is amended by striking `an amount equal to two-thirds of' and inserting `the amount (if any) by which the sum of such benefit (before reduction under this paragraph) and', and by inserting `exceeds $1,200,' before `if'.

(b) HUSBAND'S INSURANCE BENEFITS- Section 202(c)(2)(A) of such Act (42 U.S.C. 402(c)(2)(A)) is amended by striking `an amount equal to two-thirds of' and inserting `the amount (if any) by which the sum of such benefit (before reduction under this paragraph) and', and by inserting `exceeds $1,200,' before `if'.

(c) WIDOW'S INSURANCE BENEFITS- Section 202(e)(7)(A) of such Act(42 U.S.C. 402(e)(7)(A)) is amended by striking `an amount equal to two-thirds of' and inserting `the amount (if any) by which the sum of such benefit (before reduction under this paragraph) and', and by inserting `exceeds $1,200,' before `if'.

(d) WIDOWER'S INSURANCE BENEFITS- Section 202(f)(2)(A) of such Act (42 U.S.C. 402(f)(2)(A)) is amended by striking `an amount equal to two-thirds of' and inserting `the amount (if any) by which the sum of such benefit (before reduction under this paragraph) and', and by inserting `exceeds $1,200,' before `if'.

(e) MOTHER'S AND FATHER'S INSURANCE BENEFITS- Section 202(g)(4)(A) of such Act (42 U.S.C. 402(g)(4)(A)) is amended by striking `an amount equal to two-thirds of' and inserting `the amount (if any) by which the sum of such benefit (before reduction under this paragraph) and', and by inserting `exceeds $1,200,'before `if'.

SEC. 2. EFFECTIVE DATE.

The amendments made by section 1 shall apply with respect to monthly insurance benefits payable under title II of the Social Security Act for months after December 1997.

Following are initial co-sponsors of H.R. 2273, as of 7/25/97:

Rep. Abercrombie (D-HI)
Rep. Ackerman (D-NY)
Rep. Berman (D-CA)
Rep. Bonior (D-MI)
Rep. Brown, C.(D-FL)
Rep. Brown, G. (D-CA
Rep. Carson (D-IN))
Rep. Clayton (D-NC)
Rep. Clyburn (D-SC)
Rep. Conyers (D-MI)
Rep. Cummings (D-MD)
Rep. Davis, D. (D-IL)
Rep. Delahunt (D-MA)
Rep. Dellums (D-CA)
Rep. Dixon (D-CA)
Rep. English (R-PA)
Rep. Evans (D-IL)
Rep. Filner (D-CA)
Rep. Flake (D-NY)
Rep. Frank (D-MA)
Rep. Frost (D-TX)
Rep. Furse (D-OR)
Rep. Gejdenson (D-CT)
Rep. Hall, T. (D-OH)
Rep. Hayworth (R-AZ)
Rep. Hilliard (D-AL)
Rep. Jackson-Lee (D-TX)
Rep. Kilpatrick (D-MI)
Rep. LaTourette (R-OH)
Rep. Lewis, John (D-GA)
Rep. Lipinski (D-IL)
Rep. Lofgren (D-CA)
Rep. Lowey (D-NY)
Rep. Manton (D-NY)
Rep. Matsui (D-CA)
Rep. Meek (D-FL)
Rep. Mink (D-HI)
Rep. Nadler (D-NY)
Rep. Neal (D-MA)
Rep. Ney (R-OH)
Rep. Olver (D-MA)
Rep. Payne, D. (D-NJ)
Rep. Rahall (D-WV)
Rep. Rangel ,(D-NY)
Rep. Rush (D-IL)
Rep. Schiff (R-NM)>
Rep. Stark (D-CA)
Rep. Strickland (D-OH)
Rep. Thompson (D-MS)
Rep. Traficant (D-OH)
Rep. Wynn (D-MD)


Subject: NARFE Hotline 7/25/97

Hello. Recorded Friday, July 25th, this NARFE Legislative HOTLINE seeks to keep NARFE members focused on immediate action to impact the House-Senate conference committee, still in progress, to resolve different Medicare provisions in the Budget Reconciliation bill, H.R. 2015. Congress is planning to be in summer recess from August 2nd through Labor Day.

The need for immediate response to the means test and a new home health care co-pay contained in the Senate bill is facilitated by a toll-free number for reaching the Capitol switchboard: 1-800/522- 6721. A message to President Clinton is also in order at the White House Comment Line number: 202/456-1111.

Senate-approved Medicare changes, not in the House reconciliation bill, have set the controversial new cost provisions up as major issues for the conference committee. Influencing the conferees is best done by telephoning your own two Senators and single Representative. Called in large numbers these Members of Congress then will lobby their colleagues on the conference committee! Now it rests with member phone calls.

NARFE national convention delegates have historically opposed means-testing of earned or work-based federal benefits. NARFE has already joined other senior organizations in voicing opposition to the Senate's Medicare reform plans, and President Jackson urged President Clinton to "take a strong public position against any proposal to means-test Medicare deductibles or premiums." However, President Clinton recently indicated willingness to go along with means-testing Medicare premiums.

NARFE members are urged to contact their own representative and two senators by phone immediately. A toll-free number sponsored by the AFL-CIO allows callers to reach the Capitol switchboard without cost. That number is 1-800/522-6721. The White House Comment Line is area code 202/456-1111.

Judy Park asks all NARFE members to quickly deliver the following message to their own Congressional delegation and the White House:

"Please urge the Medicare conferees to oppose plans to means-test Medicare premiums, and require new home health co-pays. Medicare was enacted in 1965 to provide health security to all Americans at age 65 -- regardless of income. The commitment made to those who have paid into the program through taxes and payroll deductions must be kept. We cannot afford another Medicare catastrophic law!

A large and diverse coalition, including NARFE, helped defeat a complex House bill, H.R. 2003 that would have used sequestration to enforce the still-being-negotiated budget deal. Details in Retirement Life.

Thank you for calling. The Hotline is available by both E-mail and on NARFE's web page on the Internet. All are services of the National Association of Retired Federal Employees.


Date: Thu, 24 Jul 1997 14:07:36
Subject: Summary Report of Electronics Committee

For NARFE Netters - I am happy to transmit the following summary report by Russ Boor of the success of the NARFE Electronic Communication Committee in presenting its proposals to the NARFE Executive Board last week. A second transmission will be the complete Report (8 pages) -- Don Geoffrion

NOTE - The complete report can be read from the Chapter 740 main page

Fellow NARFE netters,

It appears that NARFE has taken a large step forward in their quest to take advantage of recent developments in electronic communication. An Electronic Communication Committee was appointed by National President Jackson in late May, 1997 to peruse the parameters of a NARFE rapid communication system. The Committee met at NARFE headquarters, Washington DC, July 10, 11, 12 and 14 and prepared a six page report which was unanimously adopted by the NARFE National Executive Board on July 14, 1997.

A brief summary of the Electronic Communication Committee's report follows:

SUMMARY

After interviewing all Resident Officers, department heads and many staff members at NARFE headquarters, the committee developed action items for "short term", "mid term" and "long term" implementation. "Short-term" being those things that can and should be implemented now, prior to our moving to a new headquarters building as early as this coming November; "mid-term" being those things which could and should be accomplished in conjunction with the move and shortly thereafter; "long-term" being very desirable items which are impractical for immediate implementation but certainly should be considered downstream in the not too distant future, say within five years or the year 2002.

The committee next developed a set of expectations and goals that could be achieved by the year 2002. In a short five years NARFE will see:

To implement and accomplish a plan toward the attainment of the above goals and take advantage of the unique opportunity created by NARFE's pending and almost imminent move to a new headquarters, a plan of action must be quickly developed and approved. There is no time left to put off a decision or this unique cost savings opportunity will be lost.

SHORT TERM ACTION ITEMS

MID-TERM ACTION ITEMS:

LONG-RANGE RECOMMENDATIONS:

Additional comments and more detailed information were included in attachment to the report.

The report is not meant to be either inclusive or complete. It is strongly recommended that the combined knowledge, expertise and ingenuity of NARFE management and staff be sought thru their active participation in the planning and execution of any electronic communication plan including the use of e-mail, the intranet and web site.

The report was signed by Elton "Al" Hippert - Chairman and Region VIII National Field Vice President, Russell Boor from New Mexico and E. Lee Gross from South Dakota.

Additional Comment: Action has already been initiated at NARFE headquarters to recruit a Systems Administrator/Webmaster.


Subject: NARFE Hotline 7/11/97

This week's hotline, which urges quick action: -- Jim

Hello. Recorded Friday July 11th, this four-minute edition of the NARFE Legislative HOTLINE seeks to keep NARFE members focused on immediate action to impact the House-Senate conference committee, now in progress, to resolve different Medicare provisions in the two Budget Reconciliation bills. Action by conferees is expected as early as next week.

The need for immediate response to the means test and a new home health care co-pay contained in the Senate bill is facilitated by a toll free number for reaching the Capitol switchboard: 1-800/522-6721. A message to President Clinton is also in order at the White House Comment Line number: 202/456-1111.

Senate-approved Medicare changes, not in the House reconciliation bill, have set the controversial new cost provisions up as major issues for the conference committee. Influencing the conferees is best done by telephoning your own two Senators and single Representative. Called in large numbers, these Members of Congress then will lobby the conferees!

NARFE national convention delegates have historically opposed means-testing of earned or work-based federal benefits. NARFE has already joined other senior organizations in voicing opposition to the Senate's Medicare reform plans, and NARFE President Jackson urged President Clinton to "take a strong public position against any proposal to means-test Medicare deductibles or premiums." However, the President recently indicated willingness to go along with means-testing Medicare premiums.

NARFE members are urged to contact their own representative and two senators by phone immediately. Again, a toll-free number sponsored by the AFL-CIO allows callers to reach the Capitol switchboard without cost. That number is 1-800/522-6721. The White House Comment Line is 202/456-1111.

Judy Park asks all NARFE members to quickly deliver the following message to their own Congressional delegation and the White House:

"Please urge the Medicare conferees to oppose plans to means-test Medicare premiums, and require new home health co-pays. Medicare was enacted in 1965 to provide health security to all Americans at age 65 -- regardless of income. The commitment made to those who have paid into the program through taxes and payroll deductions must be kept. We cannot afford another Medicare catastrophic law!

Thank you for calling. The Hotline is available by both E-mail and on NARFE's web page on the Internet. All are services of the National Association of Retired Federal Employees.

Internet Congress: House e-mail addresses are changing in some cases. To receive a list of all the e-mail addresses for participating Reps, send a message to: congress@hr.house.gov

For more information on the House or Representatives Constituent Electronic Mail System, send an e-mail to househlp@hr.house.gov. Comments on the system can be e-mailed to: comments@hr.house.gov

225 Representatives have Web home pages on the House system. To reach a page of links to these pages listed by Member, point your browser to: http://www.house.gov/MemberWWW.html

The House and Senate Internet system can also be reached by gopher at gopher.house.gov and gopher.senate.gov respectively.

82 Senators currently have e-mail addresses through the Senate's Internet system. To get a list of these addresses via e-mail, send a message to: webmaster@scc.senate.gov

Most Senators have Web home pages on this system. To reach a page of links to all these pages, point your browser to: http://www.senate.gov/index.html

Subj: New ad
Date: 97-07-10 15:46:22 EDT
From: NARFEHQ
To: Netters

The following is the text of a new NARFE advocacy ad that is running in several papers in the Washington area next week:

NARFE URGES CONGRESS ON MEDICARE: LET'S NOT MAKE ANOTHER 'CATASTROPHIC' MISTAKE!

America's seniors have been promised adequate, affordable health care, and for almost three decades Medicare has kept that promise. To keep the Medicare promise for future generations, Congress, the President and the public recognize that certain changes must be made.

As part of the bipartisan plan to balance the budget, both the House and Senate passed bills to curtail Medicare costs for cutting $115 billion over the next five years. Both bills also set up a commission to recommend long-term solutions for Medicare.

But the Senate bill jumps the gun. Immediate and radical changes in seniors' health care costs and coverage were included without congressional hearings or public comment. For some older Americans, monthly Medicare premiums could quadruple next year as a result.

This reminds us of ten years ago, when Congress enacted a bill to force an unfair and unwanted seniors-only surtax for "catastrophic coverage." NARFE was a leading force in the outcry that forced its repeal within a year. Let's wait for a commission to study critical changes in Medicare's costs and coverage. NARFE says:

LET'S NOT MAKE ANOTHER CATASTROPHIC MISTAKE!

National Association of Retired Federal Employees * 202-234-0832 1533 New Hampshire Avenue, NW, Washington, DC 20036 * E-mail: NARFEHQ@aol.com Website: http://www.narfe.org


Subject: Fedweek Excerpts 7/9/97

NARFE Sounds Medicare/FEHB Alarm

The National Association of Retired Federal Employees says that proposed changes to the Medicare system could put the Federal Employees Health benefits program on shaky ground. The Medicare proposals, which would means test Part B coverage, gradually raise the minimum eligibility age from 65 to 67 over a 30-year period and increase the costs of home health care, would tend to move federal retirees eligible for Medicare away from that program,requiring the FEHB program to pick up the slack. Net effect, says NARFE: Higher FEHB premiums in the plans they would favor.

House and Senate Working on Retirement Change

House and Senate civil service leaders have begun the final nitty-gritty work on a proposed change to the federal retirement system. Most of their differences have been ironed out and they appear ready to require higher retirement contributions from agencies and individual employees. Workers would pay another 0.5 percent of salary phased in over three years beginning in January 1999 under the plan.

House Would Give Military Greater Raises Than Civilians The House's version of the defense authorization bill would break the link between military and civil service pay. The White House and Senate armed services panel are strongly against it, as are federal employee organizations who view the proposed delinking as valuing military members over civil service workers. The 1998 federal pay raise is expected to be 2.8 percent. How much military members would receive under the controversial House proposal is uncertain.


Date: Thu, 3 Jul 1997 09:00:49 -0400 (EDT)
From: NARFEHQ@aol.com
Subject: Bad News

It is my sad duty to report that NARFE Headquarters suffered a tremendous loss yesterday. Ms. Veleatta Adams, Assistant to the Manager, Public Relations, was killed in an automobile accident while on vacation.

All NARFE-Netters are aware of the outstanding work she has been doing for Public Relations and as an Assistant to the Public Relations Manager, particularly as it related to receipt and answering of e-mail. We hope you will bear with us for the next several weeks as we arrange to fill this void. Veleatta was an exceptional person and will be sorely missed.

Charles R. Jackson
National President


Subj: Washington Letter
Date: 97-06-26 16:58:52 EDT
From: NARFEHQ
To: NARFE Netters

NARFE WASHINGTON LETTER

Friday June 27, 1997
Volume 13, #8

The devil is still in the details. As predicted earlier, implementing the budget agreement is proving more difficult than negotiating its grand outline. Before escaping Washington's heat for a week-long Independence Day recess, the House and Senate handily adopted reconciliation bills designed to save $137 billion over the next five years as outlined in the FY '98 Budget Resolution. But there are numerous differences in the spending and tax cut measures of the two chambers which must be resolved in conference when lawmakers reconvene next month.

The good news for civil service annuitants is the absence of a COLA delay in either the House or Senate reconciliation bill, which are almost identical in their treatment of federal retirement and the Federal Employee Health Benefits Program (FEHBP). In addition to rejecting the administration's COLA delay proposal, both the House Government Reform and Senate Governmental Affairs Committees reported a plan to assure FEHBP enrollees that the employer (government) share of premiums will continue indefinitely at the current average 72 percent without reliance on a formula using an Aetna proxy or "phantom" premium.

Friendly Washington-area Representatives and Senate Subcommittee Chairman Thad Cochran (R-MS) cooperated with OPM, NARFE, and federal employee groups in crafting the new FEHBP premium formula which will prevent unanticipated jumps in enrollee health care costs at the end of next year, when the old Aetna plan's "phantom" premium would have expired. Without the adroitly designed new "Fair Share" formula, enrollees' average annual premiums would have jumped $164 for self-only and $326 for self and family.

The reconciliation news is not so good on Senate plans for reforming Medicare. During the Senate Finance Committee's mark-up of Medicare provisions, a proposal to means-test the Medicare Part B deductible was easily adopted. When senior citizen organizations and the White House objected, Committee Chairman William Roth (R-DE) and Ranking Democrat Daniel Patrick Moynihan (D-NY) agreed to a manager's amendment to means-test the Part B premium instead of the deductible. The Committee also recommended a gradual raise in the Medicare eligibility age from 65 to 67 over the next 30 years and establishing a $5 co-payment for home health care visits.

Heated rhetoric and contentious votes occurred during Senate floor consideration of the Medicare provisions on June 24, but in the end all of the proposals backed by the Finance Committee prevailed. They were: (1) a motion to table (kill) a Kennedy amendment to strike the $5 copayment for home health care visits passed by a 60-40 vote; (2) a motion to waive the Budget Act with respect to a point of order against the Medicare age eligibility hike was agreed to by a vote of 62-38 (a 3/5 supermajority vote (60) of the Senate is required to waive the Budget Act); (3) a motion to table (kill) a Kennedy amendment to strike the means-based formula to determine Medicare Part B premiums was agreed to 70-30; and (4) a motion to waive the Budget Act with respect to a point of order against an amendment to delay the means-based premium until January 2000 was rejected 37-63 (60 votes are required to waive the Budget Act),

The new Senate-approved Medicare changes are not in the House reconciliation bill, setting the controversial provisions up as major issues for the upcoming conference committee. Now the jockeying for influence in the conference begins in earnest!

NARFE national convention delegates have historically opposed means-testing of earned or work-based federal benefits. The association has already joined other senior organizations in voicing opposition to the Senate's Medicare reform plans, and President Jackson has urged President Clinton to "take a strong public position against any proposal to means-test Medicare deductibles or premiums."

NARFE members are urged to contact their own Representative and two Senators by phone immediately. A toll-free number sponsored by the AFL-CIO allows callers to reach the Capitol switchboard without cost. That number is 1-800-522-6721. Callers can select either the House or Senate and by keying in their ZIP code be connected with their own Representative and Senators. The NARFE Legislative Hotline will be updated as frequently as necessary to keep NARFE members informed of any changes.

All NARFE members should quickly deliver the following message to their own Congressional delegation:

"Please oppose the Senate's plan to raise Medicare premiums, home health co-pays and the eligibility age. Medicare was enacted in 1965 to provide health security to all Americans at age 65 -- regardless of income. The commitment made to those who have paid into the program through taxes and payroll deductions must be kept."

The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) was unchanged in May, remaining at 157.2. The latest CPI-W is still 1.7 percent higher than the 1996 third quarter average base index of 154.6. The annual COLAs of persons receiving benefits under the Federal Employees Compensation Act (FECA) are based on each calendar year's rise in the CPI-W. During the first five months of 1997, the index has risen 0.8 percent,

Letters and postcards will reach any Member of Congress if it has the Member's name, the chamber (House or Senate) and the correct Washington ZIP code. The House ZIP code is 20515 and the Senate's ZIP is 20510.

Important numbers (worth clipping): Capitol switchboard 202/224-3121; Bill Status (8:30 a.m. to 5:30 p.m.) 202/225-1772; White House Comment Line (9 a.m. to 5 p.m. est Monday through Friday) 202/456-1111; White House facsimile 202/456-2461; the President's E-mail address president@whitehouse.gov; (July's Retirement Life devotes 3 pages to Congressional E-mail addresses); Supreme Court 202/479-3000; OPM 202/606-1000; Federal Election Commission 1-800/424-9530; and NARFE Legislative Hotline 202/234-0503. NARFE Home Page on the Internet: http://www.narfe.org/

NARFE's excellent 105th Congress Directory can still be ordered Checks for $7.00 per copy should be sent to: NARFE Congressional Directory, 1533 New Hampshire Ave. NW, Washington DC 20036-1279. A full page promotion and order form appears on page 17 of June's Retirement Life.

Enclosed with this issue of NARFE's Washington Letter is your state's listing of CSRS/FERS annuitants and military retirees by Congressional District as of 9/30/96. This information, which indicates the numbers of state and/or district constituents affected by federal retirement and insurance legislation, should be used in lobbying contacts with Members of Congress and state officials. The dollar amounts of annuities and military retirement pay are useful in illustrating how our numbers impact the economic and tax base of the respective state or congressional district. Please share this information with your membership and use it in your Congressional contacts.


Subj: Friday Hotline
Date: 97-06-27 15:23:28 EDT
From: NARFEHQ
To: Netters

Hello. This urgent action edition of the NARFE Legislative Hotline was recorded Friday, June 27th. This four-minute edition focuses NARFE member action on the House-Senate conference committee which will have to resolve different Medicare provisions in the two Budget Reconciliation bills. The need for immediate response to the means test contained in the Senate bill is made easier by a toll-free number: 1-800/522-6721. The HOTLINE will be updated as needed and details have been mailed to Chapter Presidents and Legislative Officers.

During the Senate Finance Committee's mark-up of Medicare provisions, a proposal to means-test the Medicare Part B deductible was easily adopted. When senior citizen organizations and the White House objected, Finance Committee Chairman Roth of Delaware and Ranking Democrat Moynihan of New York won unanimous consent for a manager's amendment to means-test the Part B premium instead of the deductible. The Committee also recommended a gradual raise in the Medicare eligibility age from 65 to 67 over the next 30 years and establishing a $5 co-payment for home health care visits.

Heated rhetoric and contentious votes occurred during Senate floor consideration of the Medicare provisions on June 24, but in the end all of the proposals backed by the Finance Committee prevailed.

The new Senate-approved Medicare changes are not in the House reconciliation bill, setting the controversial provisions up as major issues for the upcoming conference committee. Now the jockeying for influence in the conference begins in earnest!

NARFE national convention delegates have historically opposed means testing of earned or work-based federal benefits. NARFE has already joined other senior organizations in voicing opposition to the Senate's Medicare reform plans, and President Jackson has urged President Clinton to "take a strong public position against any proposal to means-test Medicare deductibles or premiums."

NARFE members are urged to contact their own Representative and two Senators by phone immediately. A toll-free number sponsored by the AFL-CIO allows callers to reach the Capitol switchboard without cost. That number is 1-800/522-6721.

Judy Park asks all NARFE members to quickly deliver the following message to their own Congressional delegation:

"Please oppose the Senate's plan to raise Medicare premiums, home health co-pays and the eligibility age. Medicare was enacted in 1965 to provide health security to all Americans at age 65 -- regardless of income. The commitment made to those who have paid into the program through taxes and payroll deductions must be kept."

Thank you for calling. The Hotline is available by both E-mail and on NARFE's web page on the Internet. All are services of the Nat'l Assn. of Retired Federal Employees.


Subj: Re: Medicare
Date: 97-06-26 17:06:24 EDT
From: NARFEHQ
To: StChuck1

Chuck St. Lawrence,

I'm glad we were able to assist you in awareness of mandates from National Conventions on the means testing issue.

As to legislation to gain passage of tax equity with social security, Rep. Bruce Vento (D-MN) has had a bill in Congress for at least the past ten years on this issue. In the 105h Congress it is H.R. 372 introduced on 1/7/97 titled "Equity in Taxation of Federal Annuities." It states "a bill to amend the Internal Code of 1986 to provide an exclusion from gross income for that portion of a government pension received by an individual which does not exceed the maximum benefits payable under Title II of the Social Security Act which could have been excluded from income for the taxable year.

Unfortunately, there are no cosponsors on the bill so its chances for enactment are slim and this has been his problem in past years - lack of cosponsorship, mainly as you can see as it certainly would be less revenue for the Treasury.

Much of our concern with the philosophy of means testing is the precedent it would establish for other retirement income and health insurance programs, particularly the Federal Employees Health Benefit Program. In fact, although it has not been widely reported by the media, one of the amendments approved by voice vote of the Senate Wednesday night after the votes on means-testing, new copayments, and gradually increasing medicare eligibility age, was a Kennedy amendment to means-test the FEHBP premiums of all Senators. While the amendment will probably be dropped in conference next month, it could well be a harbinger of things to come - not just for Senators but for all enrollees.

So you can see we must be very careful in any resolution advocating means testing as one could get more than which they bargain.

Charles R. Jackson, NARFE National President


For NARFE Netters: Following letter was sent today to Cong. Zach Wamp, (R) 3rd Dist. TN. Letter was cleared with Judy Park and may be used as a basis for similar letters to your Congressional representatives. - Don Geoffrion

Tennessee Federation of Chapters, NARFE
6220 Shallowford Road #398
Chattanooga, TN 37421-5476
June 26, 1997

The Honorable Zach Wamp
U.S. House of Representatives
Washington, DC 20515

Dear Mr. Wamp:

The budget bill passed by the Senate yesterday includes provisions relating to Medicare which are inconsistent with the bipartisan budget agreement worked out between the Congress and the White House earlier this year. The introduction of means testing to determine premiums for Medicare Part "B" and raising the Medicare threshold to age 67 bring forth new elements not contemplated in that agreement, which was so carefully fashioned.

The average annuity of federal civil service retirees falls well below the contemplated threshold of the Senate's proposed starting point for higher Medicare "B" premiums. However, we have long been opposed to means-testing on principle. We fear the "camel's nose under the tent" whereby means-testing, once introduced, can easily be extended to lower thresholds and to other programs.

With respect to raising the age for Medicare eligibility, this does not seem in keeping with the original establishment of Medicare as a program to provide health care for the needy elderly. Moreover, the Senate provision does not recognize the prevalence of early retirement as is acknowledged by basic Social Security benefits.

On behalf of all retired federal civil servants in Tennessee and in your District, we ask you to join with your colleagues in the House in urging that these added changes approved by the Senate be rejected in the forthcoming House- Senate conference on the Budget legislation.

Best Regards

Donald V. Geoffrion
Leg.Liaison Off., 3rd Dist.


For NARFE Netters - The following AP dispatch by Alan Fram, furnished by courtesy of fellow netter Herman Ciha, gives details on the Senate Medicare action yesterday. The House may not agree with the "means-test" provisions and the President, accordingn to the NY Times today, wants the House to remove these provisions from this proposed legislation. - Don Geoffrion

Senate Votes to Raise Medicare Age

By Alan Fram
Associated Press Writer
Tuesday, June 24, 1997; 8:28 p.m. EDT

Here's something I hope the President Vetoes Herman Ciha

WASHINGTON (AP) -- Determined to trim the price tag of government health care for the elderly, the Senate voted Tuesday to increase monthly Medicare premiums for better-off seniors and gradually raise the eligibility age for benefits to 67.

The votes demonstrated a surprising willingness by the Senate to take on the politically potent elderly population, even though both proposals face an uncertain future in the face of opposition by President Clinton.

The higher premiums were adopted by voice vote as an alternative to higher deductibles for higher-income Medicare recipients on their physician fees. Republicans said the higher premiums would affect only the best-off 5 percent of senior citizens, and prevailed 70-30 when Democrats tried to overturn the Senate's action.

The roll call to increase the Medicare eligibility age was 62-38.

Under the Senate plan, Medicare premiums would begin to increase for elderly individuals whose incomes exceed $50,000, and be fully phased in for those earning $100,000. At that maximum income level, an individual's annual premium would be $2,160 next year when the changes would take effect, instead of the current $540.

Higher premiums would begin for couples earning $75,000 and be fully phased-in at $125,000.

The Senate bill had originally increased the annual $100 deductible for higher-earning seniors. But this was replaced by the premium increase after concerns were raised that the boost would not affect the healthiest seniors and would be hard to administer because it would require access to income tax records.

The Senate would also gradually increase the current Medicare eligibility age of 65 to 67 by 2027, the same as for Social Security. The slow phase-in of the measure, which decreased the political risk of supporting it, was such that the government would save no money through 2002. Savings would be $10 billion from 2003 through 2007.

The two votes represented a defeat for the nation's largest senior citizens' organization, the American Association of Retired Persons, which opposed both plans. And they pleased and somewhat surprised anti-deficit organizations.

``I think they've finally heard the wake-up call,'' said Martha Phillips, executive director of the Concord Coalition, a bipartisan group that lobbies for deficit reduction.

© Copyright 1997 The Associated Press


For NARFE Netters - Following is a special Hotline message dated 6/24/97, from NARFE Hq. - Don Geoffrion

Special, urgent hotline, gang:

Hello and welcome to a special edition of the NARFE Legislative Hotline, recorded Tuesday, June 24th. This four-minute edition updates the Friday recording and focuses on the revised means test contained in the Senate Budget Reconciliation bill, S. 947. The need for immediate response to the means test contained in the Senate bill is made easier by a toll-free number will be listed. The HOTLINE will be updated as needed.

The means test that was included in the Senate Finance Committee's version of Medicare changes has been altered. Now the means test would be applied to the Part B premium rather than the annual deductible. With bipartisan backing, the new provisions would apply so called "income-based" payment to Medicare premiums rather than deductibles.

This provision will be debated and voted so immediately that only telephone calls can impact the process. NARFE is opposed to any form of means testing.

The Finance committee also approved a proposal to raise the Medicare eligibility age from 65 to 67 over the next 30 years. As a result, more Americans age 65 and over would join the ranks of the uninsured. Efforts to delete the Finance Committee provision to impose a new 5-dollar co-payment on Medicare home health care were defeated by a motion to table that was adopted by a vote of 60 to 40.

Senate floor votes will occur as early as June 24th, so each NARFE member should immediately telephone their two Senators to oppose any Medicare means testing. To reach your own Senators you can call a toll free number sponsored by the AFL-CIO which will connect you to the Capitol switchboard. The number is 1-800/522-6721. After providing your name and address, tell your Senators you are opposed to any means testing in the Medicare program. The place for means testing is the tax code!

Thank you for calling. The Hotline is available by both E-mail and on NARFE's web page on the Internet. All are services of the National Association of Retired Federal Employees.

Internet Congress: House e-mail addresses are changing in some cases. To receive a list of all the e-mail addresses for participating Reps, send a message to: congress@hr.house.gov For more information on the House or Representatives Constituent Electronic Mail System, send an e-mail to househlp@hr.house.gov. Comments on the system can be e-mailed to: comments@hr.house.gov 225 Representatives have Web home pages on the House system. To reach a page of links to these pages listed by Member, point your browser to: http://www.house.gov/MemberWWW.html The House and Senate Internet system can also be reached by gopher at gopher.house.gov and gopher.senate.gov respectively. 82 Senators currently have e-mail addresses through the Senate's Internet system. To get a list of these addresses via e-mail, send a message to: webmaster@scc.senate.gov Most Senators have Web home pages on this system. To reach a page of links to all these pages, point your browser to: http://www.senate.gov/index.html


Wednesday, June 18, 1997;

Freebie News

Don Mace, former editor of the Federal Employees News Digest and associate editor of the Federal Times, has launched FEDweek, an e-mail weekly. It is available free to federal and postal workers and retirees. To sign up, visit FEDweek's Web site (http://www.fedweek.com) or send your name, street and e-mail address to: FEDweek, P.O. Box 7605, McLean, Va. 22106-7605.


Subject: NARFE Hotline 6/13/97

Hello and welcome. This NARFE Legislative Hotline was recorded Friday the 13th of June. This four-minute edition covers two key actions in the House Government Reform and Oversight Committee to comply with the budget resolution. The next HOTLINE will be made Friday, June 20th.

On Wednesday, June 11 the House committee with jurisdiction for all civil service issues, the Government Reform and Oversight Committee, approved language to meet the instructions of the concurrent resolution on the budget. All current federal and postal employees would be required to increase their contribution to the retirement system by 0.5 percent. Federal agencies, but not the Postal Service, would have to contribute 1.51 percent more for just those employees covered by the older retirement plan, the Civil Service Retirement System.

Due to the efforts of thousands of NARFE members, the committee report contains NO COLA delay. NARFE members should continue to recruit COLA Equity cosponsors and thank the 18 Senators and 239 Representatives who cosponsored the COLA equity resolutions, Senate Concurrent Resolution 7 and HouseConcurrent Resolution 13 championed by Senator Paul Sarbanes and Representative Connie Morella, respectively.

The second key action of the Government Reform and Oversight Committee was the approval of an amendment offered by Rep. Connie Morella to solve the dilemma of the expiring FEHBP premium formula in such a way as to hold harmless all enrollees -- employees and retirees. Several other Representatives played an important role in drafting and winning approval of this provision. They are Reps. Steny Hoyer (D-MD), Tom Davis (R-VA), Elijah Cummings (D-MD), Jim Moran (D-VA), Harold Ford, Jr. (D- TN), Eleanor Holmes Norton (D-DC), and Vic Fazio (D-CA).

Senate action in the Governmental Affairs Committee during the week of June 16th is expected to precisely parallel the action of the House panel. Senator Thad Cochran, whose subcommittee has jurisdiction for civil service and postal service, has been helpful in this process.

The July issue of Retirement Life will report in greater detail on these and other budget developments. Cosponsors of important NARFE-supported and opposed legislation will be listed.

NARFE members who have already recruited and thanked their own Representative can concentrate on their Senators. In only four states -- Maryland, Hawaii, Arkansas and New York -- have both Senators cosponsored our COLA Equity Resolution, Senate Concurrent Resolution 7. The current 18 cosponsors are a far cry from the 66 Senators who cosponsored COLA Equity legislation in 1990. Obviously NARFE members in most states have more work to do.

Thank you for calling. The Hotline is available by both E-mail and on NARFE's web page on the Internet. All are services of the Nat'l Assn of Retired Federal Employees.

Congress on the Internet: House e-mail addresses are changing in some cases. To receive a list of all the e-mail addresses for participating Reps, send a message to: congress@hr.house.gov

For more information on the House or Representatives Constituent Electronic Mail System, send an e-mail to househlp@hr.house.gov. Comments on the system can be e-mailed to: comments@hr.house.gov

225 Representatives have Web home pages on the House system. To reach a page of links to these pages listed by Member, point your browser to: http://www.house.gov/memberWWW.html

The House and Senate Internet system can also be reached by gopher at gopher.house.gov and gopher.senate.gov respectively.

82 Senators currently have e-mail addresses through the Senate's Internet system. To get a list of these addresses via e-mail, send a message to: webmaster@scc.senate.gov

Most Senators have Web home pages on this system. To reach a page of links to all these pages, point your browser to: http://www.senate.gov/index.html


Subject: Causey Column 6/12/97

High-Octane Protection

Active and retired government workers and their families would be protected from a potential $276-per-policyholder annual increase in health premiums under a bipartisan plan on the legislative fast track.

The so-called high-octane plan would guarantee that Uncle Sam continues to pay about 72 percent of the average employee's and retiree's health premium no matter how much that premium increases each year. The Clinton administration supports the plan.

If all goes well, this will be a classic example of how behind-the-scenes bipartisan support -- with a big assist from federal and postal unions and organizations -- saves government workers from a danger most didn't even know they faced.

The Federal Employees Health Benefits Program covers 10 million government workers and retirees, dependent children, some former spouses and survivors. The program helps pay medical and hospital bills for about half the people in the Washington area -- from the president to your local letter carrier.

Currently, the government share of health premiums -- about 72 percent for nonpostal workers and retirees -- is maintained through a complex formula that is due to expire next year. Without action by Congress, employees and retirees would find themselves paying a bigger share of health insurance premiums, which go up almost every year. As reported here June 6, workers and retirees would pay at least $900 million more over five years for health insurance.

The 72 percent level would be maintained under a plan worked out by Reps. Constance A. Morella (R-Md.) and Steny H. Hoyer (D-Md.). Aides differ over who should get the principal credit for the legislation.

But both Washington area politicians deserve big-time credit for doing what they did. They also managed to get indifferent or hostile members of their political parties to go along with the plan.

The plan, contained in a Morella amendment, passed the Republican-controlled House Government Reform and Oversight Committee yesterday. It will be part of a budget reconciliation package that, once it passes the full House, will be sent to the Senate. Sen. Thad Cochran (R-Miss.), who heads the Senate Civil Service Committee, has won bipartisan support for the plan from Senate leaders.

The proposal would head off a change -- due to take place next year -- that would gradually reduce the government share of health premiums, requiring workers and retirees to pay a gradually increasing chunk of their premium. The Hoyer-Morella plan won't stop regular premium increases attributable to cost and benefit changes or medical inflation, but it will ensure that the government continues to pay the biggest part of the premiums.

The downside for federal workers is that the reconciliation package would require workers covered by the older Civil Service Retirement System to pay an additional 0.5 percent of salary into the system. Most already contribute 7 percent of salary.

If the high-octane plan becomes law, grateful feds might consider using some of the money they will save on health premiums on a thank-you card to their favorite Washington area member of Congress. Or, if you know a federal, postal or retiree organization lobbyist, take him or her to lunch


Insurance Maneuvers

Friday, June 6, 1997; Page D02

Government health insurance policyholders would be spared a $900 million increase in health premiums under a bipartisan fix being worked out in Congress. The idea is to come up with a substitute for a program, due to expire in 1999, that has kept Uncle Sam paying an average of 72 percent of employee and retiree health premiums for years.

Rep. Constance A. Morella (R-Md.) will introduce the plan next week as part of the budget reconciliation package. Without it, premiums for employees or retirees could jump an average of $276 a year, in addition to regular increases caused by inflation and benefit changes.

The federal health program -- the nation's largest "company" plan -- covers nearly 10 million people, including more than half of the people in the Washington area. It is paying most of the bills for President Clinton's knee injury, and it helps cover medical costs of senators, Supreme Court justices, and feds and family members -- from postal clerks to FBI agents. It also covers retirees and survivors. In some cases, ex-spouses and adult dependent children of feds and retirees also are covered.

Workers and retirees choose from dozens of plans and options and can switch plans at least once a year. They can't be turned down or denied coverage because of age, health or preexisting conditions. Policyholders' premiums in the plan have risen less in most years than those of private health plans or the rate of medical inflation. Two reasons for that:

The government, to a large extent, can dictate premiums and benefits to carriers eager to participate.

The government share of premiums has been kept artificially at 72 percent (on average) for years through a complicated system that averages premiums of the five largest plans, plus a nonexistent "phantom plan" whose premiums are set to make sure the government share remains the same, even when premiums go up.

Congressional Democrats eliminated the phantom program when they controlled Congress. But its expiration date has been extended several times -- for political reasons -- with 1999 the newest deadline.

But influential members of Congress, from Morella and Rep. Steny H. Hoyer (D-Md.) in the House to Senate civil service subcommittee Chairman Thad Cochran (R-Miss.), have been looking for a legislative way to replace the phantom program but maintain the 72 percent federal share. Backers hope the substitute system will become part of the civil service portion of both the House and Senate budget reconciliation bills now in the draft stage.

On Wednesday, insurance experts from the Office of Personnel Management met in Morella's office to present a plan that the Clinton administration presumably will endorse. Union leaders and a representative from Cochran's office were on hand.

Representatives of the Federal Government Service Task Force -- a congressional civil service caucus whose members include virtually every Washington area member of Congress -- also met with the minority (Democratic) staff of the House Government Reform and Oversight Committee on legislation to protect the government formula.


Subj: Hotline
Date: 97-06-06 16:40:12 EDT
From: NARFEHQ
To: Netters:

Here's your D-Day Hotline:

Hello. Welcome to the NARFE Legislative Hotline recorded June 6th. This three-minute edition notes House and Senate passage of the conference report on the budget resolution, House Concurrent Resolution 84. Now the heavy lifting begins in earnest for the authorizing committees and meeting the appropriation limitations in the budget blueprint. The next HOTLINE will be made Friday, the 13th of June.

Like the earlier separate versions, the conference report on the budget resolution contains NO COLA delay. NARFE members should continue to recruit COLA equity cosponsors and thank the 17 Senators and 234 Representatives who cosponsored the COLA equity resolutions, Senate Concurrent Resolution 7 and House Concurrent Resolution 13, championed by Senator Paul Sarbanes and Representative Connie Morella, respectively.

The votes on the conference report, 327-97 in the House and 76-22 in the Senate, are very similar to the earlier House and Senate votes to approve slightly distinct versions.

The July issue of Retirement Life will report in detail on these budget developments and again list the cosponsors of important NARFE supported and opposed legislation.

NARFE members who have already recruited and thanked their own Representative can concentrate on their Senators. In only four states -- Maryland, Hawaii, Arkansas and New York -- have both Senators cosponsored our COLA equity resolution, Senate Concurrent Resolution 7. The current 17 cosponsors are a far cry from the 66 Senators who cosponsored COLA equity legislation in 1990. Obviously NARFE members in most states have more work to do.

Thank you for calling. The Hotline is available by both e-mail and on NARFE's web page on the Internet. All are services of the Naional Association of Retired Federal Employees.

Update on Congress in Cyberspace: House e-mail addresses are changing in some cases. To receive a list of all the e-mail addresses for participating Reps, send a message to: congress@hr.house.gov

For more information on the House or Representatives Constituent Electronic Mail System, send an e-mail to househlp@hr.house.gov. Comments on the system can be e-mailed to: comments@hr.house.gov

225 Representatives have Web home pages on the House system. To reach a page of links to these pages listed by Member, point your browser to: http://www.house.gov/memberWWW.html

The House and Senate Internet system can also be reached by gopher at gopher.house.gov and gopher.senate.gov respectively.

82 Senators currently have e-mail addresses through the Senate's Internet system. To get a list of these addresses via e-mail, send a message to: webmaster@scc.senate.gov

Most Senators have Web home pages on this system. To reach a page of links to all these pages, point your browser to: http://www.senate.gov/index.html


Subj: Friday hotline
Date: 97-05-23 16:04:07 EDT
From: NARFEHQ

Netters: Here's your Friday hotline with several items of good news to launch your holiday weekend: -- Jim

Hello and welcome. In three minutes this NARFE Legislative Hotline, recorded May 23rd, notes House and Senate passage of similar but not identical budget blueprints. The Congressional recess, May 24th through June 2nd, provides NARFE members the opportunity to meet their Senators and Representatives, many of whom who will be holding public meetings in their states and districts. Due to the Memorial Day Recess, the next HOTLINE will be made Friday, June 6th.

The budget resolutions passed in the House and Senate contain NO COLA delay. NARFE members should continue to recruit COLA equity cosponsors and thank the 17 Senators and 231 Representatives who cosponsored the COLA equity resolutions, Senate Concurrent Resolution 7 and House Concurrent Resolution 13, championed by Senator Paul Sarbanes and Representative Connie Morella, respectively.

Current federal workers would be required by this proposal to contribute one-half percent more of their wages into the retirement systems. Agencies, except the Postal Service, employing persons covered by the older system, CSRS, would have to contribute an additional 1.51 percent toward retirement beginning October 1st, 1997. $115 billion over five years in Medicare savings are also included.

After defeating 5 substitutes, the House passed the budget resolution, House Concurrent Resolution 84. The vote was 333 to 99, garnering a majority of both parties. On Friday, May 23rd, the Senate completed action on a very similar budget resolution. The Senate vote was similarly bipartisan, 78 ayes to 22 nays. When Congress returns to Washington on June 3rd, the hard work of implementing this deal begins in earnest with a deadline for committees to report by June 12th. The Ways and Means Committee has until June 13th.

NARFE-supported volunteer protection legislation, H.R. 911, passed 390 to 35. The 156 House cosponsors, listed in recent issues of Retirement Life, should be thanked! NARFE's convention resolution on legislation to avoid future government shutdowns is the main remaining dispute on the disaster relief bill.

Thank you for calling. The Hotline is available by both E-mail and on NARFE's web page on the Internet. All are services of the National Association of Retired Federal Employees.


Following is an excerpt from today's Mike Causey column 6/3/97
---------------------------------------------------------------
Retiree Raises:

Rep. Elijah E. Cummings (D-Md.) has introduced a double-barreled resolution that would put the House on record as opposing future efforts to change the effective date of cost-of-living adjustments for retirees or to raise employee pension plan contributions.

In the compromise budget with Congress, the White House dropped plans to delay COLAs for retirees in each of the next five years. But the tentative budget still includes the White House plan to force employees to contribute an additional half-percent of pay toward their pension plan.

The COLA delay plan was dropped because of strong bipartisan House opposition. The campaign was led by Rep. Constance A. Morella (R-Md.). Groups representing feds and retirees called in lots of congressional IOUs to protect retiree COLAs. Politicians got the message: The National Association of Retired Federal Employees and the National Association of Letter Carriers have two of the nation's largest political action committee war chests.

Cummings hopes to get enough signatures on his resolution to force budget-writers to look somewhere besides employee pension plan contributions for a place to cut costs.


Subj: Hotline
Date: 97-05-16 17:11:21 EDT
From: NARFEHQ

Netters: Here's your Friday hotline:

Hello and welcome. In three minutes this NARFE Legislative Hotline, recorded May 16th, provides the information we have at deadline and urges continued vigilance. April inflation will also be reported. The next HOTLINE will be made Friday, May 23rd.

With greater certainty we can again report the budget deal contains NO COLA delay. NARFE members should continue to recruit COLA Equity cosponsors and thank those Senators and Representatives who cosponsored the COLA equity resolutions, Senate Concurrent Resolution 7 and House Concurrent Resolution 13 championed by Senator Paul Sarbanes and Representative Connie Morella, respectively. There are no final victories, however, and close attention to Sunday Network TV News programs, C- SPAN, better newspapers and this Hotline are clearly warranted.

Current federal workers would be required by this proposal to contribute one half percent more of their wages into the retirement systems. Agencies, except the Postal Service, employing persons covered by the older system, CSRS, would have to contribute an additional 1.51 percent toward retirement.

On Friday, May 16th, the House Budget Committee adopted a budget resolution for fiscal year 1998 that CBO predicts will get to a small surplus in 2002. The Senate Budget Committee will hold a budget resolution markup on Monday, May 19th at 4 pm. The goal in both chambers is floor passage before the Memorial Day recess.

While we fight for inflation protection, it should be noted that BLS reported a very modest rate of inflation. April was the second consecutive month in which inflation measured by the CPI-W was held to 0.1 percent. Thousands of price data points recorded by BLS, crunched using the best methodology, show that the actual index reading rose from 157.0 in March to 157.2 for April. The latest CPI figure is 1.7 percent higher than the 1996 third-quarter average base index of 154.6.


Subj: Mike Causey Colume 5/13
Date: 97-05-13 13:34:04 EDT
From: hermc@juno.com (HERMAN J CIHA)

Beware. Write your Congessmen on this.
Herman Ciha

Ghost of Premiums Past


Tuesday, May 13 1997; Page B02

If you don't mind paying an extra $20 a month for your health insurance coverage, skip this and move on to another part of the newspaper. We'll see you here tomorrow, but before you go, remember: "The Phantom" -- actually the ghost of a former health plan -- is watching! The artificial premium in that ghost plan plays a major role in how much each federal worker pays for insurance.

But if shelling out $240 a year in addition to any regular premium increase your plan imposes would dent your personal budget, read on. First, this quiz:

Q: What do Hollywood producers and pro-federal-worker politicians have in common?

A: Producers who saw that bringing superheroes Batman and Superman to the silver screen made pots of money hoped to cash in big-time with a movie involving a lesser-known comic-page hero, the Phantom. As with most movies, they stood to lose a lot of money. Meanwhile, back on the East Coast, members of Congress who look out for the 5 million federal workers and retirees hope to keep another "phantom" alive and well within the federal health program. If the politicians bomb and the federal health plan phantom disappears, workers and retirees will wind up paying higher premiums. The federal health program covers half the population of the Washington area, from federal janitors to the first family itself.

Pro-fed politicians of both parties are working to make sure the final budget agreement doesn't make any changes in the formula used to set Uncle Sam's share of employee and retiree premiums.

The formula, which determines the government share of premiums, guarantees that the government will pay about 72 percent of the total premium for employees, regardless of how much premiums increase. That's done by taking an average of the premiums in the five largest plans in the federal health program as well as a nonexistent premium for Aetna, which pulled out of the program years ago. That is the "phantom" premium, and it is factored in to guarantee that Uncle Sam's share of the premium each year comes out to about 72 percent of the total. It is a good deal for workers and retirees.

Years ago, the Democrat- controlled Congress passed legislation saying that using the phantom health plan didn't make any sense and that it was costing taxpayers millions of dollars each year. Scheduled to be phased out, the phantom plan got a couple of extensions, but it is due to expire next year.

President Clinton's proposed five-year budget assumed certain savings in civil service programs based on the premise that the phantom plan would be dropped at the end of this year. But the Congressional Budget Office -- which has become the official numbers referee for scoring this budget agreement -- does not assume dollar savings based on the disappearance of the phantom plan.

All of the above -- if you were brave enough to have read this far -- means that nobody really knows what is going to happen to health premiums next year. If the formula changes, employee and retiree premiums will go up by an estimated $20 a month above and beyond any regular increases in premiums.

Rep. Steny H. Hoyer (D-Md.) has been working the Democratic side of Congress to save the phantom. Reps. Thomas M. Davis III (R-Va.) and Constance A. Morella (R-Md.) have been bombarding the House and Senate Budget committees, asking them to protect premiums of feds and retirees.

Marathon Man

Moe Biller, the 81-year-old president of the American Postal Workers Union, joined the old Post Office Department as a clerk 60 years ago this month. In a special tribute to Biller, Senate Minority Leader Thomas A. Daschle (D-S.D.) called him the "dean of the American labor movement." After serving in World War II, Biller rejoined the Post Office Department. He was elected president of the big New York local -- which has about one-third of the union's total membership -- in 1959 and became APWU's national president in 1980.


Who's In, Out on COLAs

Thursday, May 1 1997; Page D02

Efforts to protect cost-of-living adjustments for federal retirees have produced such confused infighting in the House of Representatives that you can't tell who is doing what to whom (or why) without a scorecard. Here's an attempt to explain what is (or, more correctly, what isn't) happening:

President Clinton has proposed more than $6 billion in cuts in the federal retirement program over the next five years.

Part of the cutting would be accomplished by paying retiree COLAs in April, instead of in January, in each of the next five years. Retirees would lose $1.2 billion to $1.7 billion in COLA payments. Other savings would be accomplished by forcing workers and agencies to pay more into the retirement fund. Employee contributions would go up the equivalent of 0.5 percent of salary, and agency contributions would be increased by an amount equal to 1.5 percent of salary. That would cut workers' take-home pay and make employees more expensive to their agencies.

House Republicans are expected to go along with the dollar savings in federal retirement programs proposed by the president when they come up with their overall budget. It will be up to the House Government Reform and Oversight Committee to decide how to make those savings. The committee would be bound by the dollar figures, but not by which programs to cut, to achieve those savings.

To head off the COLA delay, Rep. Constance A. Morella (R-Md.) introduced a resolution that would put the House on record as opposing any plan targeted specifically at federal retirees. It already has 192 co-sponsors -- close to half the House membership. It has wide bipartisan support. The chairman of the House civil service subcommittee, John L. Mica (R-Fla.), says it wouldn't be fair to delay COLAs for federal retirees.

Here's where the scorecard comes in handy.

On Tuesday, Mica's subcommittee was to approve Morella's hands-off-the-COLA resolution. But committee Democrats proposed rewriting the resolution to include opposition to the president's proposals to raise agency and employee pension plan contributions. They say that feds have lost $220 billion in pay and benefits in the last two decades (much of it during the Clinton administration). They don't want any cuts -- including those proposed by their president -- in civil service programs. Republicans balked at "diluting" the Morella resolution. No vote was taken.

Democrats (and some unions) claim the Morella resolution is part of a Republican leadership plot to help pass the president's civil service budget plan. Since the resolution is non-binding, they argue, it might as well be expanded to protect other civil service benefits threatened by the White House.

Republicans say the last-minute attempt to amend a simple, one-ingredient (save-the-COLA) resolution would make it too controversial. If the cuts aren't made by delaying COLAs and raising pension plan contributions, the alternative might be to change the retirement computation formula, to reduce future pensions or to add a "means test" to future COLAs so that well-to-do-retirees receive only partial raises.

As it stands, the COLA issue may not be settled until Memorial Day.

The Clinton administration apparently has established the minimum amount of the cuts to be made. The question is which benefits of feds or retirees, or both, will be altered and which party can do the best job of damage control -- explaining why it did what it did -- to frustrated and angry feds and retirees.

Thursday, May 1, 1997


Subj: Budget agreement ends cola delay threat
Date: 97-05-04 09:32:38 EDT
From: donvon@erols.com (Donald B vonWolffradt)

Our efforts seem to have paid off. Thanks to Judy Park and staff and all NARFers who phoned, wrote, or e-mailed their Congressional delegation.

Agreement Does Ask Civil Servants to Pay More Toward Retirement

The budget agreement embraced Friday by President Clinton and Republican Congressional leaders requires federal employees to pay more but it averted a fierce fight with civil service retirees by dropping a provision that would have delayed cost-of-living adjustments for pension benefits.

Rep. Steny H. Hoyer (D-Md.), who joined Clinton in Baltimore for the announcement of the balanced-budget deal, disclosed the details of how the spending plan would affect federal benefits in a telephone interview. He and other members of the area's congressional delegation had opposed provisions that sought budget savings from federal worker compensation.

Under the agreement, federal employees, would be asked to contribute more toward their retirement, starting in January 1999. The additional contributions would be phased in over three years, for a total increase equivalent to 0.5 percent of their salary. Most employees now have about 7 percent of their pay deducted for retirement contributions.

The trust funds that pay federal retirement benefits have been running at a deficit and the government has had to tap general revenues to pay pensions. The higher employee contributions would reduce the drain on the Treasury.

In 1999, the typical employee contribution would increase about $100 per year. By 2001, the increase would be slightly more than $200 a year, according to budget projections.

The higher contribution rate would produce budget savings of about $1.8 billion.

Federal agencies also would be asked to set aside an additional $3 billion for the retirement system for government workers.

Currently, agencies match employee contributions of 7 percent. Under the budget deal, executive branch agencies would increase their contributions to the Civil Service Retirement System to 8.51 percent of salary. The 1.51 percent increase would be effective Oct. 1, 1997, through Sept. 30, 2002.

Agency contributions for another pension program, the Federal Employees Retirement System, would remain at the current rate of 11.4 percent of salary.

This section of the budget has been under consideration for more than two years. Sen. Ted Stevens (R-Alaska) proposed increasing retirement contributions in 1995 when he chaired the Senate Governmental Affairs Committee. The budget submitted by Clinton in February mirrored Stevens' proposal.

Hoyer said he was disappointed that the budget deal included increased retirement contributions, but he called the decision to drop the delay in cost-of-living adjustments (COLAs) for retirees "a step in the direction."

Hoyer, other Hill Democrats, Sen. Thad Cochran R-Miss.), who oversees civil service issues in the Senate, Rep. John L. Mica (R-Fla.), his House counterpart, and other Republicans opposed the COLA delay, saying it was wrong to ask one group to contribute more in budget savings than others.

Stevens and the White House had proposed saving $1.7 billion by delaying the date COLAs are paid to federal retirees. Instead of January, the adjustments would have been made in April from 1998 through 2002.

Federal union leaders said they will lobby against the retirement changes. "I'm pleased that the amount of savings allocated to federal employees has declined, but I don't think it has declined enough," said Robert M. Tobias, president of the National Treasury Employees Union.


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