[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 1232 Introduced in Senate (IS)]







106th CONGRESS
  1st Session
                                S. 1232

   To provide for the correction of retirement coverage errors under 
           chapters 83 and 84 of title 5, United States Code.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             June 17, 1999

Mr. Cochran (for himself and Mr. Akaka) introduced the following bill; 
  which was read twice and referred to the Committee on Governmental 
                                Affairs

_______________________________________________________________________

                                 A BILL


 
   To provide for the correction of retirement coverage errors under 
           chapters 83 and 84 of title 5, United States Code.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Federal Erroneous 
Retirement Coverage Corrections Act''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Definitions.
Sec. 3. Applicability.
Sec. 4. Irrevocability of elections.
 TITLE I--DESCRIPTION OF RETIREMENT COVERAGE ERRORS TO WHICH THIS ACT 
              APPLIES AND MEASURES FOR THEIR RECTIFICATION

Subtitle A--Employees and Annuitants Who Should Have Been FERS Covered, 
 but Who Were Erroneously CSRS Covered or CSRS-Offset Covered Instead, 
             and Survivors of Such Employees and Annuitants

Sec. 101. Employees.
Sec. 102. Annuitants and survivors.
  Subtitle B--Employee Who Should Have Been FERS Covered, CSRS-Offset 
Covered, or CSRS Covered, but Who Was Erroneously Social Security-Only 
                            Covered Instead

Sec. 111. Applicability.
Sec. 112. Correction mandatory.
Subtitle C--Employee Who Should or Could Have Been Social Security-Only 
  Covered but Who Was Erroneously CSRS-Offset Covered or CSRS Covered 
                                Instead

Sec. 121. Employee who should be Social Security-Only covered, but who 
                            is erroneously CSRS or CSRS-Offset covered 
                            instead.
         Subtitle D--Employee Who Was Erroneously FERS Covered.

Sec. 131. Employee who should be Social Security-Only covered, CSRS 
                            covered, or CSRS-Offset covered and is not 
                            FERS-eligible, but who is erroneously FERS 
                            covered instead.
Sec. 132. FERS-Eligible Employee Who Should Have Been CSRS Covered, 
                            CSRS-Offset Covered, or Social Security-
                            Only Covered, but Who Was Erroneously FERS 
                            Covered Instead Without an Election.
Sec. 133. Retroactive effect.
Subtitle E--Employee Who Should Have Been CSRS-Offset Covered, but Who 
                  Was Erroneously CSRS Covered Instead

Sec. 141. Applicability.
Sec. 142. Correction mandatory.
  Subtitle F--Employee Who Should Have Been CSRS Covered, but Who Was 
                Erroneously CSRS-Offset Covered Instead

Sec. 151. Applicability.
Sec. 152. Correction mandatory.
                      TITLE II--GENERAL PROVISIONS

Sec. 201. Identification and notification requirements.
Sec. 202. Information to be furnished to and by authorities 
                            administering this Act.
Sec. 203. Service credit deposits.
Sec. 204. Provisions related to Social Security coverage of 
                            misclassified employees.
Sec. 205. Thrift Savings Plan treatment for certain individuals.
Sec. 206. Certain agency amounts to be paid into or remain in the 
                            CSRDF.
Sec. 207. CSRS coverage determinations to be approved by OPM.
Sec. 208. Discretionary actions by Director.
Sec. 209. Regulations.
                      TITLE III--OTHER PROVISIONS

Sec. 301. Provisions to permit continued conformity of other Federal 
                            retirement systems.
Sec. 302. Authorization and appropriation.
Sec. 303. Individual right of action preserved for amounts not 
                            otherwise provided for under this Act.
Sec. 304. Effective date.
                        TITLE IV--TAX PROVISIONS

Sec. 401. Tax provisions.
              TITLE V--MISCELLANEOUS RETIREMENT PROVISIONS

Sec. 501. Federal Reserve Board portability of service credit.
Sec. 502. Certain transfers to be treated as a separation from service 
                            for purposes of the Thrift Savings Plan.

 SEC. 2. DEFINITIONS.

    For purposes of this Act:
            (1) Annuitant.--The term ``annuitant'' has the meaning 
        given such term under section 8331(9) or 8401(2) of title 5, 
        United States Code.
            (2) CSRS.--The term ``CSRS'' means the Civil Service 
        Retirement System.
            (3) CSRDF.--The term ``CSRDF'' means the Civil Service 
        Retirement and Disability Fund.
            (4) CSRS covered.--The term ``CSRS covered'', with respect 
        to any service, means service that is subject to the provisions 
        of subchapter III of chapter 83 of title 5, United States Code, 
        other than service subject to section 8334(k) of such title.
            (5) CSRS-offset covered.--The term ``CSRS-Offset covered'', 
        with respect to any service, means service that is subject to 
        the provisions of subchapter III of chapter 83 of title 5, 
        United States Code, and to section 8334(k) of such title.
            (6) Executive director.--The term ``Executive Director of 
        the Federal Retirement Thrift Investment Board'' or ``Executive 
        Director'' means the Executive Director appointed under section 
        8474 of title 5, United States Code.
            (7) FERS.--The term ``FERS'' means the Federal Employees' 
        Retirement System.
            (8) FERS covered.--The term ``FERS covered'', with respect 
        to any service, means service that is subject to chapter 84 of 
        title 5, United States Code.
            (9) Former employee.--The term ``former employee'' means an 
        individual who formerly was a Government employee, but who is 
        not an annuitant.
            (10) OASDI taxes.--The term ``OASDI taxes'' means the OASDI 
        employee tax and the OASDI employer tax.
            (11) OASDI employee tax.--The term ``OASDI employee tax'' 
        means the tax imposed under section 3101(a) of the Internal 
        Revenue Code of 1986 (relating to Old-Age, Survivors and 
        Disability Insurance).
            (12) OASDI employer tax.--The term ``OASDI employer tax'' 
        means the tax imposed under section 3111(a) of the Internal 
        Revenue Code of 1986 (relating to Old-Age, Survivors and 
        Disability Insurance).
            (13) OASDI trust funds.--The term ``OASDI trust funds'' 
        means the Federal Old-Age and Survivors Insurance Trust Fund 
        and the Federal Disability Insurance Trust Fund.
            (14) Office.--The term ``Office'' means the Office of 
        Personnel Management.
            (15) Retirement coverage determination.--The term 
        ``retirement coverage determination'' means a determination by 
        an employee or agent of the Government as to whether a 
        particular type of Government service is CSRS covered, CSRS-
        Offset covered, FERS covered, or Social Security-Only covered.
            (16) Retirement coverage error.--The term ``retirement 
        coverage error'' means an erroneous retirement coverage 
        determination that was in effect for a minimum period of 3 
        years of service after December 31, 1986.
            (17) Social security-only covered.--The term ``Social 
        Security-Only covered'', with respect to any service, means 
        Government service that--
                    (A) constitutes employment under section 210 of the 
                Social Security Act (42 U.S.C. 410); and
                    (B)(i) is subject to OASDI taxes; but
                    (ii) is not subject to CSRS or FERS.
            (18) Survivor.--The term ``survivor'' has the meaning given 
        such term under section 8331(10) or 8401(28) of title 5, United 
        States Code.
            (19) Thrift savings fund.--The term ``Thrift Savings Fund'' 
        means the Thrift Savings Fund established under section 8437 of 
        title 5, United States Code.

SEC. 3. APPLICABILITY.

    (a) In General.--This Act shall apply with respect to retirement 
coverage errors that occur before, on, or after the date of enactment 
of this Act.
    (b) Limitation.--Except as otherwise provided in this Act, this Act 
shall not apply to any erroneous retirement coverage determination that 
was in effect for a period of less than 3 years of service after 
December 31, 1986.

SEC. 4. IRREVOCABILITY OF ELECTIONS.

    Any election made (or deemed to have been made) by an employee or 
any other individual under this Act shall be irrevocable.

 TITLE I--DESCRIPTION OF RETIREMENT COVERAGE ERRORS TO WHICH THIS ACT 
              APPLIES AND MEASURES FOR THEIR RECTIFICATION

Subtitle A--Employees and Annuitants Who Should Have Been FERS Covered, 
 but Who Were Erroneously CSRS Covered or CSRS-Offset Covered Instead, 
             and Survivors of Such Employees and Annuitants

SEC. 101. EMPLOYEES.

    (a) Applicability.--This section shall apply in the case of any 
employee or former employee who should be (or should have been) FERS 
covered but, as a result of a retirement coverage error, is (or was) 
CSRS covered or CSRS-Offset covered instead.
    (b) Uncorrected Error.--
            (1) Applicability.--This subsection applies if the 
        retirement coverage error has not been corrected before the 
        effective date of the regulations described under paragraph 
        (3). As soon as practicable after discovery of the error, and 
        subject to the right of an election under paragraph (2), if 
        CSRS covered or CSRS-Offset covered, such individual shall be 
        treated as CSRS-Offset covered, retroactive to the date of the 
        retirement coverage error.
            (2) Coverage.--
                    (A) Election.--Upon written notice of a retirement 
                coverage error, an individual may elect to be CSRS-
                Offset covered or FERS covered, effective as of the 
                date of the retirement coverage error. Such election 
                shall be made not later than 180 days after the date of 
                receipt of such notice.
                    (B) Nonelection.--If the individual does not make 
                an election by the date provided under subparagraph 
                (A), a CSRS-Offset covered individual shall remain 
                CSRS-Offset covered and a CSRS covered individual shall 
                be treated as CSRS-Offset covered.
            (3) Regulations.--The Office shall promulgate regulations 
        to carry out this subsection.
    (c) Corrected Error.--
            (1) Applicability.--This subsection applies if the 
        retirement coverage error was corrected before the effective 
        date of the regulations described under subsection (b).
            (2) Coverage.--
                    (A) Election.--
                            (i) CSRS-offset covered.--Not later than 
                        180 days after the date of enactment of this 
                        Act, the Office shall promulgate regulations 
                        authorizing individuals to elect, during the 
                        18-month period immediately following the 
                        effective date of such regulations, to be CSRS-
                        Offset covered, effective as of the date of the 
                        retirement coverage error.
                            (ii) Thrift savings fund contributions.--If 
                        an individual elects to be CSRS-Offset covered, 
                        all employee contributions to the Thrift 
                        Savings Fund made during the period of FERS 
                        coverage, and earnings thereon, may remain in 
                        that Fund, notwithstanding any limit that would 
                        otherwise be applicable.
                    (B) Previous settlement payment.--An individual who 
                previously received a payment ordered by a court or 
                provided as a settlement of claim for losses resulting 
                from a retirement coverage error shall not be entitled 
                to make an election under this subsection unless that 
                amount is waived in whole or in part under section 208, 
                and any amount not waived is repaid.
                    (C) Ineligibility for election.--An individual who, 
                subsequent to correction of the retirement coverage 
                error, received a refund of retirement deductions under 
                section 8424 of title 5, United States Code, or a 
                distribution under section 8433 of title 5, United 
                States Code, may not make an election under this 
                subsection.
            (3) Corrective action to remain in effect.--If an 
        individual is ineligible to make an election or does not make 
        an election under paragraph (2) before the end of any time 
        limitation under this subsection, the corrective action taken 
        before such time limitation shall remain in effect.

SEC. 102. ANNUITANTS AND SURVIVORS.

    (a) In General.--This section shall apply in the case of an 
individual who is--
            (1) an annuitant who should have been FERS covered but, as 
        a result of a retirement coverage error, was CSRS covered or 
CSRS-Offset covered instead; or
            (2) a survivor of an employee who should have been FERS 
        covered but, as a result of a retirement coverage error, was 
        CSRS covered or CSRS-Offset covered instead.
    (b) Coverage.--
            (1) Election.--Not later than 180 days after the date of 
        enactment of this Act, the Office shall promulgate regulations 
        authorizing an individual described under subsection (a) to 
        elect CSRS-Offset coverage or FERS coverage, effective as of 
        the date of the retirement coverage error.
            (2) Time limitation.--An election under this subsection 
        shall be made not later than 18 months after the effective date 
        of the regulations promulgated under paragraph (1).
            (3) Reduced annuity.--
                    (A) Amount in account.--If the individual elects 
                CSRS-Offset coverage, the amount in the employee's 
                Thrift Savings Fund account under subchapter III of 
                chapter 84 of title 5, United States Code, on the date 
                of retirement that represents the Government's 
                contributions and earnings on those contributions 
                (whether or not such amount was subsequently 
                distributed from the Thrift Savings Fund) will form the 
                basis for a reduction in the individual's annuity, 
                under regulations promulgated by the Office.
                    (B) Reduction.--The reduced annuity to which the 
                individual is entitled shall be equal to an amount 
                which, when taken together with the amount referred to 
                in subparagraph (A), would result in the present value 
                of the total being actuarially equivalent to the 
                present value of an unreduced CSRS-Offset annuity that 
                would have been provided the individual.
            (4) Reduced benefit.--If--
                    (A) a surviving spouse elects CSRS-Offset benefits; 
                and
                    (B) a FERS basic employee death benefit under 
                section 8442(b) of title 5, United States Code, was 
                previously paid;
        then the survivor's CSRS-Offset benefit shall be subject to a 
        reduction, under regulations promulgated by the Office. The 
        reduced annuity to which the individual is entitled shall be 
        equal to an amount which, when taken together with the amount 
        of the payment referred to under subparagraph (B) would result 
        in the present value of the total being actuarially equivalent 
        to the present value of an unreduced CSRS-Offset annuity that 
        would have been provided the individual.
            (5) Previous settlement payment.--An individual who 
        previously received a payment ordered by a court or provided as 
        a settlement of claim for losses resulting from a retirement 
        coverage error may not make an election under this subsection 
        unless repayment of that amount is waived in whole or in part 
        under section 208, and any amount not waived is repaid.
    (c) Nonelection.--If the individual does not make an election under 
subsection (b) before any time limitation under this section, the 
retirement coverage shall be subject to the following rules:
            (1) Corrective action previously taken.--If corrective 
        action was taken before the end of any time limitation under 
        this section, that corrective action shall remain in effect.
            (2) Corrective action not previously taken.--If corrective 
        action was not taken before such time limitation, the employee 
        shall be CSRS-Offset covered, retroactive to the date of the 
        retirement coverage error.

  Subtitle B--Employee Who Should Have Been FERS Covered, CSRS-Offset 
Covered, or CSRS Covered, but Who Was Erroneously Social Security-Only 
                            Covered Instead

SEC. 111. APPLICABILITY.

    This subtitle shall apply in the case of any employee who--
            (1) should be (or should have been) FERS covered but, as a 
        result of a retirement coverage error, is (or was) Social 
        Security-Only covered instead;
            (2) should be (or should have been) CSRS-Offset covered 
        but, as a result of a retirement coverage error, is (or was) 
        Social Security-Only covered instead; or
            (3) should be (or should have been) CSRS covered but, as a 
        result of a retirement coverage error, is (or was) Social 
        Security-Only covered instead.

SEC. 112. CORRECTION MANDATORY.

    (a) Uncorrected Error.--If the retirement coverage error has not 
been corrected, as soon as practicable after discovery of the error, 
such individual shall be covered under the correct retirement coverage, 
effective as of the date of the retirement coverage error.
    (b) Corrected Error.--If the retirement coverage error has been 
corrected, the corrective action previously taken shall remain in 
effect.

Subtitle C--Employee Who Should or Could Have Been Social Security-Only 
  Covered but Who Was Erroneously CSRS-Offset Covered or CSRS Covered 
                                Instead

SEC. 121. EMPLOYEE WHO SHOULD BE SOCIAL SECURITY-ONLY COVERED, BUT WHO 
              IS ERRONEOUSLY CSRS OR CSRS-OFFSET COVERED INSTEAD.

    (a) Applicability.--This section applies in the case of a 
retirement coverage error in which a Social Security-Only covered 
employee was erroneously CSRS covered or CSRS-Offset covered.
    (b) Uncorrected Error.--
            (1) Applicability.--This subsection applies if the 
        retirement coverage error has not been corrected before the 
        effective date of the regulations described in paragraph (3).
            (2) Coverage.--In the case of an individual who is 
        erroneously CSRS covered, as soon as practicable after 
        discovery of the error, and subject to the right of an election 
        under paragraph (3), such individual shall be CSRS-Offset 
covered, effective as of the date of the retirement coverage error.
            (3) Election.--
                    (A) In general.--Upon written notice of a 
                retirement coverage error, an individual may elect to 
                be CSRS-Offset covered or Social Security-Only covered, 
                effective as of the date of the retirement coverage 
                error. Such election shall be made not later than 180 
                days after the date of receipt of such notice.
                    (B) Nonelection.--If the individual does not make 
                an election before the date provided under subparagraph 
                (A), the individual shall remain CSRS-Offset covered.
                    (C) Regulations.--The Office shall promulgate 
                regulations to carry out this paragraph.
    (c) Corrected Error.--
            (1) Applicability.--This subsection applies if the 
        retirement coverage error was corrected before the effective 
        date of the regulations described under subsection (b)(3).
            (2) Election.--Not later than 180 days after the date of 
        enactment of this Act, the Office shall promulgate regulations 
        authorizing individuals to elect, during the 18-month period 
        immediately following the effective date of such regulations, 
        to be CSRS-Offset covered or Social Security-Only covered, 
        effective as of the date of the retirement coverage error.
            (3) Nonelection.--If an eligible individual does not make 
        an election under paragraph (2) before the end of any time 
        limitation under this subsection, the corrective action taken 
        before such time limitation shall remain in effect.

         Subtitle D--Employee Who Was Erroneously FERS Covered

SEC. 131. EMPLOYEE WHO SHOULD BE SOCIAL SECURITY-ONLY COVERED, CSRS 
              COVERED, OR CSRS-OFFSET COVERED AND IS NOT FERS-ELIGIBLE, 
              BUT WHO IS ERRONEOUSLY FERS COVERED INSTEAD.

    (a) Applicability.--This section applies in the case of a 
retirement coverage error in which a Social Security-Only covered, CSRS 
covered, or CSRS-Offset covered employee not eligible to elect FERS 
coverage under authority of section 8402(c) of title 5, United States 
Code, was erroneously FERS covered.
    (b) Uncorrected Error.--
            (1) Applicability.--This subsection applies if the 
        retirement coverage error has not been corrected before the 
        effective date of the regulations described in paragraph (2).
            (2) Coverage.--
                    (A) Election.--Upon written notice of a retirement 
                coverage error, an individual may elect to remain FERS 
                covered or to be Social Security-Only covered, CSRS 
                covered, or CSRS-Offset covered, as would have applied 
                in the absence of the erroneous retirement coverage 
                determination, effective as of the date of the 
                retirement coverage error. Such election shall be made 
                not later than 180 days after the date of receipt of 
                such notice.
                    (B) Nonelection.--If the individual does not make 
                an election before the date provided under subparagraph 
                (A), the individual shall remain FERS covered, 
                effective as of the date of the retirement coverage 
                error.
            (3) Employee contributions in thrift savings fund.--If 
        under this section, an individual elects to be Social Security-
        Only covered, CSRS covered, or CSRS-Offset covered, all 
        employee contributions to the Thrift Savings Fund made during 
        the period of erroneous FERS coverage (and all earnings on such 
        contributions) may remain in the Thrift Savings Fund in 
        accordance with regulations promulgated by the Executive 
        Director, notwithstanding any limit under section 8351 or 8432 
        of title 5, United States Code.
            (4) Regulations.--Except as provided under paragraph (3), 
        the Office shall promulgate regulations to carry out this 
        subsection.
    (c) Corrected Error.--
            (1) Applicability.--This subsection applies if the 
        retirement coverage error was corrected before the effective 
        date of the regulations described under paragraph (2).
            (2) Election.--Not later than 180 days after the date of 
        enactment of this Act, the Office shall promulgate regulations 
        authorizing individuals to elect, during the 18-month period 
        immediately following the effective date of such regulations to 
        remain Social Security-Only covered, CSRS covered, or CSRS-
        Offset covered, or to be FERS covered, effective as of the date 
        of the retirement coverage error.
            (3) Nonelection.--If an eligible individual does not make 
        an election under paragraph (2), the corrective action before 
        the end of any time limitation under this subsection shall 
        remain in effect.

SEC. 132. FERS-ELIGIBLE EMPLOYEE WHO SHOULD HAVE BEEN CSRS COVERED, 
              CSRS-OFFSET COVERED, OR SOCIAL SECURITY-ONLY COVERED, BUT 
              WHO WAS ERRONEOUSLY FERS COVERED INSTEAD WITHOUT AN 
              ELECTION.

    (a) In General.--
            (1) FERS election prevented.--If an individual was 
        prevented from electing FERS coverage because the individual 
        was erroneously FERS covered during the period when the 
        individual was eligible to elect FERS under title III of the 
        Federal Employees Retirement System Act or the Federal 
        Employees' Retirement System Open Enrollment Act of 1997 
        (Public Law 105-61; 111 Stat. 1318 et seq.), the individual--
                    (A) is deemed to have elected FERS coverage; and
                    (B) shall remain covered by FERS, unless the 
                individual declines, under regulations promulgated by 
                the Office, to be FERS covered.
            (2) Declining fers coverage.--If an individual described 
        under paragraph (1)(B) declines to be FERS covered, such 
        individual shall be CSRS covered, CSRS-Offset covered, or 
Social Security-Only covered, as would apply in the absence of a FERS 
election, effective as of the date of the erroneous retirement coverage 
determination.
    (b) Employee Contributions in Thrift Savings Fund.--If under this 
section, an individual declines to be FERS covered and instead is 
Social Security-Only covered, CSRS covered, or CSRS-Offset covered, as 
would apply in the absence of a FERS election, all employee 
contributions to the Thrift Savings Fund made during the period of 
erroneous FERS coverage (and all earnings on such contributions) may 
remain in the Thrift Savings Fund in accordance with regulations 
promulgated by the Executive Director, notwithstanding any limit that 
would otherwise be applicable.
    (c) Inapplicability of Duration of Erroneous Coverage.--This 
section shall apply regardless of the length of time the erroneous 
coverage determination remained in effect.

SEC. 133. RETROACTIVE EFFECT.

    This subtitle shall be effective as of January 1, 1987, except that 
section 132 shall not apply to individuals who made or were deemed to 
have made elections similar to those provided in this section under 
regulations promulgated by the Office before the effective date of this 
Act.

Subtitle E--Employee Who Should Have Been CSRS-Offset Covered, but Who 
                  Was Erroneously CSRS Covered Instead

SEC. 141. APPLICABILITY.

    This subtitle shall apply in the case of any employee who should be 
(or should have been) CSRS-Offset covered but, as a result of a 
retirement coverage error, is (or was) CSRS covered instead.

SEC. 142. CORRECTION MANDATORY.

    (a) Uncorrected Error.--If the retirement coverage error has not 
been corrected, as soon as practicable after discovery of the error, 
such individual shall be covered under the correct retirement coverage, 
effective as of the date of the retirement coverage error.
    (b) Corrected Error.--If the retirement coverage error has been 
corrected before the effective date of this Act, the corrective action 
taken before such date shall remain in effect.

  Subtitle F--Employee Who Should Have Been CSRS Covered, but Who Was 
                Erroneously CSRS-Offset Covered Instead

SEC. 151. APPLICABILITY.

    This subtitle shall apply in the case of any employee who should be 
(or should have been) CSRS covered but, as a result of a retirement 
coverage error, is (or was) CSRS-Offset covered instead.

SEC. 152. CORRECTION MANDATORY.

    (a) Uncorrected Error.--If the retirement coverage error has not 
been corrected, as soon as practicable after discovery of the error, 
such individual shall be covered under the correct retirement coverage, 
effective as of the date of the retirement coverage error.
    (b) Corrected Error.--If the retirement coverage error has been 
corrected before the effective date of this Act, the corrective action 
taken before such date shall remain in effect.

                      TITLE II--GENERAL PROVISIONS

SEC. 201. IDENTIFICATION AND NOTIFICATION REQUIREMENTS.

    Government agencies shall take all such measures as may be 
reasonable and appropriate to promptly identify and notify individuals 
who are (or have been) affected by a retirement coverage error of their 
rights under this Act.

SEC. 202. INFORMATION TO BE FURNISHED TO AND BY AUTHORITIES 
              ADMINISTERING THIS ACT.

    (a) Applicability.--The authorities identified in this subsection 
are--
            (1) the Director of the Office of Personnel Management;
            (2) the Commissioner of Social Security; and
            (3) the Executive Director of the Federal Retirement Thrift 
        Investment Board.
    (b) Authority To Obtain Information.--Each authority identified in 
subsection (a) may secure directly from any department or agency of the 
United States information necessary to enable such authority to carry 
out its responsibilities under this Act. Upon request of the authority 
involved, the head of the department or agency involved shall furnish 
that information to the requesting authority.
    (c) Authority To Provide Information.--Each authority identified in 
subsection (a) may provide directly to any department or agency of the 
United States all information such authority believes necessary to 
enable the department or agency to carry out its responsibilities under 
this Act.
    (d) Limitation; Safeguards.--Each of the respective authorities 
under subsection (a) shall--
            (1) request or provide only such information as that 
        authority considers necessary; and
            (2) establish, by regulation or otherwise, appropriate 
        safeguards to ensure that any information obtained under this 
        section shall be used only for the purpose authorized.

SEC. 203. SERVICE CREDIT DEPOSITS.

    (a) CSRS Deposit.--In the case of a retirement coverage error in 
which--
            (1) a FERS covered employee was erroneously CSRS covered or 
        CSRS-Offset covered;
            (2) the employee made a service credit deposit under the 
        CSRS rules; and
            (3) there is a subsequent retroactive change to FERS 
        coverage;
the excess of the amount of the CSRS civilian or military service 
credit deposit over the FERS civilian or military service credit 
deposit, together with interest computed in accordance with paragraphs 
(2) and (3) of section 8334(e) of title 5, United States Code, and 
regulations prescribed by the Office, shall be paid to the employee, 
the annuitant or, in the case of a deceased employee, to the 
individual  entitled to lump-sum benefits under section 8342(c) or 
8424(d) of title 5, United States Code, as applicable.
    (b) FERS Deposit.--
            (1) Applicability.--This subsection applies in the case of 
        an erroneous retirement coverage determination in which--
                    (A) the employee owed a service credit deposit 
                under section 8411(f) of title 5, United States Code; 
                and
                    (B)(i) there is a subsequent retroactive change to 
                CSRS or CSRS-Offset coverage; or
                    (ii) the service becomes creditable under chapter 
                83 of title 5, United States Code.
            (2) Reduced annuity.--
                    (A) In general.--If at the time of commencement of 
                an annuity there is remaining unpaid CSRS civilian or 
                military service credit deposit for service described 
                under paragraph (1), the annuity shall be reduced based 
                upon the amount unpaid together with interest computed 
                in accordance with section 8334(e) (2) and (3) of title 
                5, United States Code, and regulations prescribed by 
                the Office.
                    (B) Amount.--The reduced annuity to which the 
                individual is entitled shall be equal to an amount 
                that, when taken together with the amount referred to 
                under subparagraph (A), would result in the present 
                value of the total being actuarially equivalent to the 
                present value of the unreduced annuity benefit that 
                would have been provided the individual.
            (3) Survivor annuity.--
                    (A) In general.--If at the time of commencement of 
                a survivor annuity, there is remaining unpaid any CSRS 
                service credit deposit described under paragraph (1), 
                and there has been no actuarial reduction in an annuity 
                under paragraph (2), the survivor annuity shall be 
                reduced based upon the amount unpaid together with 
                interest computed in accordance with section 8334(e) 
                (2) and (3) of title 5, United States Code, and 
                regulations prescribed by the Office.
                    (B) Amount.--The reduced survivor annuity to which 
                the individual is entitled shall be equal to an amount 
                that, when taken together with the amount referred to 
                under subparagraph (A), would result in the present 
                value of the total being actuarially equivalent to the 
                present value of an unreduced survivor annuity benefit 
                that would have been provided the individual.

SEC. 204. PROVISIONS RELATED TO SOCIAL SECURITY COVERAGE OF 
              MISCLASSIFIED EMPLOYEES.

    (a) Definitions.--In this section, the term--
            (1) ``covered individual'' means any employee, former 
        employee, or annuitant who--
                    (A) is or was employed erroneously subject to CSRS 
                coverage as a result of a retirement coverage error; 
                and
                    (B) is or was retroactively converted to CSRS-
                offset coverage, FERS coverage, or Social Security-only 
                coverage; and
            (2) ``excess CSRS deduction amount'' means an amount equal 
        to the difference between the CSRS deductions withheld and the 
        CSRS-Offset or FERS deductions, if any, due with respect to a 
        covered individual during the entire period the individual was 
        erroneously subject to CSRS coverage as a result of a 
        retirement coverage error.
    (b) Reports to Commissioner of Social Security.--
            (1) In general.--In order to carry out the Commissioner of 
        Social Security's responsibilities under title II of the Social 
        Security Act, the Commissioner may request the head of each 
        agency that employs or employed a covered individual to report 
        (in coordination with the Office of Personnel Management) in 
        such form and within such timeframe as the Commissioner may 
        specify, any or all of--
                    (A) the total wages (as defined in section 3121(a) 
                of the Internal Revenue Code of 1986) paid to such 
                individual during each year of the entire period of the 
                erroneous CSRS coverage; and
                    (B) such additional information as the Commissioner 
                may require for the purpose of carrying out the 
                Commissioner's responsibilities under title II of the 
                Social Security Act (42 U.S.C. 401 et seq.).
            (2) Compliance.--The head of an agency or the Office shall 
        comply with a request from the Commissioner under paragraph 
        (1).
            (3) Wages.--For purposes of section 201 of the Social 
        Security Act (42 U.S.C. 401), wages reported under this 
        subsection shall be deemed to be wages reported to the 
        Secretary of the Treasury or the Secretary's delegates pursuant 
        to subtitle F of the Internal Revenue Code of 1986.
    (c) Payment Relating To OASDI Employee Taxes.--
            (1) In general.-- The Director of the Office of Personnel 
        Management shall transfer from the Civil Service Retirement and 
        Disability Fund to the OASDI trust funds an amount equal to the 
        excess CSRS deduction amount for covered individuals (as 
        adjusted by amounts transferred relating to applicable OASDI 
        employee taxes as a result of corrections made, including 
        corrections made before the date of enactment of this Act).
            (2) Transfer.--Amounts transferred under this subsection--
                    (A) shall be deposited in the OASDI trust funds in 
                the proportions indicated under section 201 (a) and (b) 
                of the Social Security Act (42 U.S.C. 401 (a) and (b)); 
                and
                    (B) shall be determined notwithstanding any 
                limitation under section 6501 of the Internal Revenue 
                Code of 1986.
    (d) Payment of OASDI Employer Taxes.--
            (1) In general.--Each employing agency shall pay into the 
        OASDI trust funds an amount equal to OASDI employer taxes owed 
        with respect to covered individuals during the applicable 
        period of erroneous coverage (as adjusted by amounts 
transferred for the payment of such taxes as a result of corrections 
made, including corrections made before the date of enactment of this 
Act).
            (2) Transfer.--Amounts transferred under this subsection--
                    (A) shall be deposited in the OASDI trust funds in 
                the proportions indicated under section 201 (a) and (b) 
                of the Social Security Act (42 U.S.C. 401 (a) and (b)); 
                and
                    (B) shall be determined subject to any limitation 
                under section 6501 of the Internal Revenue Code of 
                1986.
    (e) Application of OASDI Tax Provisions of the Internal Revenue 
Code of 1986 to Affected Individuals and Employing Agencies.--A covered 
individual and the individual's employing agency shall be deemed to 
have fully satisfied in a timely manner their responsibilities with 
respect to the taxes imposed by sections 3101(a), 3102(a), and 3111(a) 
of the Internal Revenue Code of 1986 on the wages paid by the employing 
agency to such individual during the entire period such individual was 
erroneously subject to CSRS coverage as a result of a retirement 
coverage error. No credit or refund of taxes on such wages shall be 
allowed as a result of this subsection.

 SEC. 205. THRIFT SAVINGS PLAN TREATMENT FOR CERTAIN INDIVIDUALS.

    (a) Applicability.--This section applies to an individual who--
            (1) is eligible to make an election of coverage under 
        section 101 or 102, and only if FERS coverage is elected (or 
        remains in effect) for the employee involved;
            (2) is described in section 111; or
            (3) is a former employee, annuitant, or survivor (subject 
        to conditions similar to those in sections 101 and 102) in the 
        case of a retirement coverage error in which a FERS covered 
        employee was erroneously Social Security-Only covered and is 
        corrected to FERS coverage.
    (b) Payment Into Thrift Savings Fund.--
            (1) In general.--
                    (A) Payment.--With respect to an individual to whom 
                this section applies, the employing agency shall pay to 
                the Thrift Savings Fund under subchapter III of chapter 
                84 of title 5, United States Code, for credit to the 
                account of the employee involved, an amount equal to 
                the earnings which are disallowed under section 8432a 
                of such title on the employee's retroactive 
                contributions to such Fund.
                    (B) Amount.--The amount paid under subparagraph (A) 
                shall represent earnings, on such retroactive 
                contributions, during the period of the retirement 
                coverage error and continuing through the date on which 
                the amount is paid by the employing agency (and based 
                on distributions from the employee's Thrift Savings 
                Plan account).
                    (C) Earnings.--Earnings under subparagraph (B) 
                shall be computed in accordance with the procedures for 
                computing lost earnings under section 8432a of title 5, 
                United States Code. The amount paid by the employing 
                agency shall be treated for all purposes as if that 
                amount had actually been earned on the basis of the 
                employee's contributions.
            (2) Additional employee contribution.--In cases in which 
        the retirement coverage error was corrected before the 
        effective date of the regulations under section 101(c), the 
        employee involved (including an employee described in 
        subsection (a)(2)) shall have an additional opportunity to make 
        retroactive contributions for the period of the retirement 
        coverage error (subject to applicable limits), and such 
        contributions (including any contributions made after the date 
        of the correction) shall be treated in accordance with 
        paragraph (1).
    (c) Regulations.--The Office, in consultation with the Federal 
Retirement Thrift Investment Board, shall prescribe regulations 
appropriate to carry out this section.

SEC. 206. CERTAIN AGENCY AMOUNTS TO BE PAID INTO OR REMAIN IN THE 
              CSRDF.

    (a) Certain Excess Agency Contributions to Remain in the CSRDF.--
            (1) In general.--Any amount described under paragraph (2) 
        shall--
                    (A) remain in the CSRDF; and
                    (B) may not be paid or credited to an agency.
            (2) Amounts.--Paragraph (1) refers to any amount of 
        contributions made by an agency under section 8423 of title 5, 
        United States Code, on behalf of any employee, former employee, 
        or annuitant (or survivor of such employee, former employee, or 
        annuitant) who makes an election to correct a retirement 
        coverage error under this Act, that the Office determines to be 
        excess as a result of such election.
    (b) Additional Employee Retirement Deductions To Be Paid by 
Agency.--If a correction in a retirement coverage error results in an 
increase in employee deductions under section 8334 or 8422 of title 5, 
United States Code, that cannot be fully paid by a reallocation of 
otherwise available amounts previously deducted from the employee's pay 
as employment taxes or retirement deductions, the employing agency--
            (1) shall pay the required additional amount into the 
        CSRDF; and
            (2) shall not seek repayment of that amount from the 
        employee, former employee, annuitant, or survivor.

SEC. 207. CSRS COVERAGE DETERMINATIONS TO BE APPROVED BY OPM.

    No agency shall place an individual under CSRS coverage unless--
            (1) the individual has been employed with CSRS coverage 
        within the preceding 365 days; or
            (2) the Office has agreed in writing that the agency's 
        coverage determination is correct.

SEC. 208. DISCRETIONARY ACTIONS BY DIRECTOR.

    (a) In General.--The Director of the Office of Personnel Management 
may--
            (1) extend the deadlines for making elections under this 
        Act in circumstances involving an individual's inability to 
        make a timely election due to a cause beyond the individual's 
        control;
            (2) provide for the reimbursement of necessary and 
        reasonable expenses incurred by an individual with respect to 
        settlement of a claim for losses resulting from a retirement 
        coverage error, including attorney's fees, court costs, and 
        other actual expenses;
            (3) compensate an individual for monetary losses that are a 
        direct and proximate result of a retirement coverage error, 
        excluding claimed losses relating to forgone contributions and 
        earnings under the Thrift Savings Plan under subchapter III of 
        chapter 84 of title 5, United States Code, and all other 
        investment opportunities; and
            (4) waive repayments otherwise required under this Act.
    (b) Similar Actions.--In exercising the authority under this 
section, the Director shall, to the extent practicable, provide for 
similar actions in situations involving similar circumstances.
    (c) Judicial Review.--Actions taken under this section are final 
and conclusive, and are not subject to administrative or judicial 
review.
    (d) Regulations.--The Office of Personnel Management shall 
prescribe regulations regarding the process and criteria used in 
exercising the authority under this section.
    (e) Report.--The Office of Personnel Management shall, not later 
than 180 days after the date of enactment of this Act, and annually 
thereafter for each year in which the authority provided in this 
section is used, submit a report to each House of Congress on the 
operation of this section.

 SEC. 209. REGULATIONS.

    (a) In General.--In addition to the regulations specifically 
authorized in this Act, the Office may prescribe such other regulations 
as are necessary for the administration of this Act.
    (b) Former Spouse.--The regulations prescribed under this Act shall 
provide for protection of the rights of a former spouse with 
entitlement to an apportionment of benefits or to survivor benefits 
based on the service of the employee.

                      TITLE III--OTHER PROVISIONS

SEC. 301. PROVISIONS TO PERMIT CONTINUED CONFORMITY OF OTHER FEDERAL 
              RETIREMENT SYSTEMS.

    (a) Foreign Service.--Sections 827 and 851 of the Foreign Service 
Act of 1980 (22 U.S.C. 4067 and 4071) shall apply with respect to this 
Act in the same manner as if this Act were part of--
            (1) the Civil Service Retirement System, to the extent this 
        Act relates to the Civil Service Retirement System; and
            (2) the Federal Employees' Retirement System, to the extent 
        this Act relates to the Federal Employees' Retirement System.
    (b) Central Intelligence Agency.--Sections 292 and 301 of the 
Central Intelligence Agency Retirement Act (50 U.S.C. 2141 and 2151) 
shall apply with respect to this Act in the same manner as if this Act 
were part of--
            (1) the Civil Service Retirement System, to the extent this 
        Act relates to the Civil Service Retirement System; and
            (2) the Federal Employees' Retirement System, to the extent 
        this Act relates to the Federal Employees' Retirement System.

SEC. 302. AUTHORIZATION AND APPROPRIATION.

    All payments permitted or required by this Act to be paid from the 
Civil Service Retirement and Disability Fund, together with 
administrative expenses incurred by the Office in administering this 
Act, shall be deemed to have been authorized to be paid from that Fund, 
which is appropriated for the payment thereof.

SEC. 303. INDIVIDUAL RIGHT OF ACTION PRESERVED FOR AMOUNTS NOT 
              OTHERWISE PROVIDED FOR UNDER THIS ACT.

    Nothing in this Act shall preclude an individual from bringing a 
claim against the Government of the United States which such individual 
may have under section 1346(b) or chapter 171 of title 28, United 
States Code, or any other provision of law (except to the extent the 
claim is for any amounts otherwise provided for under this Act).

SEC. 304. EFFECTIVE DATE.

    Except as otherwise provided in this Act, this Act shall take 
effect on the date of enactment of this Act.

                        TITLE IV--TAX PROVISIONS

SEC. 401. TAX PROVISIONS.

    (a) Plan Qualification.--No retirement plan of the United States 
(or any agency thereof) shall fail to be treated as a qualified plan 
under the Internal Revenue Code of 1986 by reason of any action taken 
under this Act.
    (b) Transfers.--For purposes of the Internal Revenue Code of 1986, 
no amount shall be includible in the gross income of any individual in 
any tax year by reason of any direct transfer under this Act between 
funds or any Government contribution under this Act to any fund or 
account in any such tax year.

              TITLE V--MISCELLANEOUS RETIREMENT PROVISIONS

SEC. 501. FEDERAL RESERVE BOARD PORTABILITY OF SERVICE CREDIT.

    (a) Creditable Service.--
            (1) In general.--Section 8411(b) of title 5, United States 
        Code, is amended--
                    (A) by striking ``and'' at the end of paragraph 
                (3);
                    (B) in paragraph (4)--
                            (i) by striking ``of the preceding 
                        provisions'' and inserting ``other paragraph''; 
                        and
                            (ii) by striking the period at the end and 
                        inserting ``; and''; and
                    (C) by adding at the end the following:
            ``(5) a period of service (other than any service under any 
        other paragraph of this subsection, any military service, and 
        any service performed in the employ of a Federal Reserve Bank) 
        that was creditable under the Bank Plan (as defined in 
        subsection (i)), if the employee waives credit for such service 
        under the Bank Plan and makes a payment to the Fund equal to 
        the amount that would have been deducted from pay under section 
        8422(a) had the employee been subject to this chapter during 
        such period of service (together with interest on such amount 
        computed under paragraphs (2) and (3) of section 8334(e)).
Paragraph (5) shall not apply in the case of any employee as to whom 
subsection (g) (or, to the extent subchapter III of chapter 83 is 
involved, section 8332(n)) otherwise applies.''.
            (2) Bank plan defined.--Section 8411 of title 5, United 
        States Code, is amended by adding at the end the following:
    ``(i) For purposes of subsection (b)(5), the term `Bank Plan' means 
the benefit structure in which employees of the Board of Governors of 
the Federal Reserve System appointed on or after January 1, 1984, 
participate, which benefit structure is a component of the Retirement 
Plan for Employees of the Federal Reserve System, established under 
section 10 of the Federal Reserve Act (and any redesignated or 
successor version of such benefit structure, if so identified in 
writing by the Board of Governors of the Federal Reserve System for 
purposes of this chapter).''.
    (b) Exclusion From Chapter 84.--
            (1) In general.--Paragraph (2) of section 8402(b) of title 
        5, United States Code, is amended by striking the matter before 
        subparagraph (B) and inserting the following:
            ``(2)(A) any employee or Member who has separated from the 
        service after--
                    ``(i) having been subject to--
                            ``(I) subchapter III of chapter 83 of this 
                        title;
                            ``(II) subchapter I of chapter 8 of title I 
                        of the Foreign Service Act of 1980; or
                            ``(III) the benefit structure for employees 
                        of the Board of Governors of the Federal 
                        Reserve System appointed before January 1, 
                        1984, that is a component of the Retirement 
                        Plan for Employees of the Federal Reserve 
                        System, established under section 10 of the 
                        Federal Reserve Act; and
                    ``(ii) having completed--
                            ``(I) at least 5 years of civilian service 
                        creditable under subchapter III of chapter 83 
                        of this title;
                            ``(II) at least 5 years of civilian service 
                        creditable under subchapter I of chapter 8 of 
                        title I of the Foreign Service Act of 1980; or
                            ``(III) at least 5 years of civilian 
                        service (other than any service performed in 
                        the employ of a Federal Reserve Bank) 
                        creditable under the benefit structure for 
                        employees of the Board of Governors of the 
                        Federal Reserve System appointed before January 
                        1, 1984, that is a component of the Retirement 
                        Plan for Employees of the Federal Reserve 
                        System, established under section 10 of the 
                        Federal Reserve Act,
                determined without regard to any deposit or redeposit 
                requirement under either such subchapter or under such 
                benefit structure, or any requirement that the 
                individual become subject to either such subchapter or 
                to such benefit structure after performing the service 
                involved; or''.
            (2) Exception.--Subsection (d) of section 8402 of title 5, 
        United States Code, is amended to read as follows:
    ``(d) Paragraph (2) of subsection (b) shall not apply to an 
individual who--
            ``(1) becomes subject to--
                    ``(A) subchapter II of chapter 8 of title I of the 
                Foreign Service Act of 1980 (relating to the Foreign 
                Service Pension System) pursuant to an election; or
                    ``(B) the benefit structure in which employees of 
                the Board of Governors of the Federal Reserve System 
                appointed on or after January 1, 1984, participate, 
                which benefit structure is a component of the 
                Retirement Plan for Employees of the Federal Reserve 
                System, established under section 10 of the Federal 
                Reserve Act (and any redesignated or successor version 
                of such benefit structure, if so identified in writing 
                by the Board of Governors of the Federal Reserve System 
                for purposes of this chapter); and
            ``(2) subsequently enters a position in which, but for 
        paragraph (2) of subsection (b), such individual would be 
        subject to this chapter.''.
    (c) Provisions Relating to Certain Former Employees.--A former 
employee of the Board of Governors of the Federal Reserve System who--
            (1) has at least 5 years of civilian service (other than 
        any service performed in the employ of a Federal Reserve Bank) 
        creditable under the benefit structure for employees of the 
        Board of Governors of the Federal Reserve System appointed 
        before January 1, 1984, that is a component of the Retirement 
        Plan for Employees of the Federal Reserve System, established 
        under section 10 of the Federal Reserve Act;
            (2) was subsequently employed subject to the benefit 
        structure in which employees of the Board of Governors of the 
        Federal Reserve System appointed on or after January 1, 1984, 
        participate, which benefit structure is a component of the 
        Retirement Plan for Employees of the Federal Reserve System, 
        established under section 10 of the Federal Reserve Act (and 
        any redesignated or successor version of such benefit 
structure, if so identified in writing by the Board of Governors of the 
Federal Reserve System for purposes of chapter 84 of title 5, United 
States Code); and
            (3) after service described in paragraph (2), becomes 
        subject to and thereafter entitled to benefits under chapter 84 
        of title 5, United States Code,
shall, for purposes of section 302 of the Federal Employees' Retirement 
System Act of 1986 (100 Stat. 601; 5 U.S.C. 8331 note) be considered to 
have become subject to chapter 84 of title 5, United States Code, 
pursuant to an election under section 301 of such Act.
    (d) Effective Date.--
            (1) In general.--Subject to succeeding provisions of this 
        subsection, this section and the amendments made by this 
        section shall take effect on the date of enactment of this Act.
            (2) Provisions relating to creditability and certain former 
        employees.--The amendments made by subsection (a) and the 
        provisions of subsection (c) shall apply only to individuals 
        who separate from service subject to chapter 84 of title 5, 
        United States Code, on or after the date of enactment of this 
        Act.
            (3) Provisions relating to exclusion from chapter.--The 
        amendments made by subsection (b) shall not apply to any former 
        employee of the Board of Governors of the Federal Reserve 
        System who, subsequent to his or her last period of service as 
        an employee of the Board of Governors of the Federal Reserve 
        System and prior to the date of enactment of this Act, became 
        subject to subchapter III of chapter 83 or chapter 84 of title 
        5, United States Code, under the law in effect at the time of 
        the individual's appointment.

SEC. 502. CERTAIN TRANSFERS TO BE TREATED AS A SEPARATION FROM SERVICE 
              FOR PURPOSES OF THE THRIFT SAVINGS PLAN.

    (a) Amendments to Chapter 84 of Title 5, United States Code.--
            (1) In general.--Subchapter III of chapter 84 of title 5, 
        United States Code, is amended by inserting before section 8432 
        the following:
``Sec. 8431. Certain transfers to be treated as a separation
    ``(a) For purposes of this subchapter, separation from Government 
employment includes a transfer from a position that is subject to one 
of the retirement systems described in subsection (b) to a position 
that is not subject to any of them.
    ``(b) The retirement systems described in this subsection are--
            ``(1) the retirement system under this chapter;
            ``(2) the retirement system under subchapter III of chapter 
        83; and
            ``(3) any other retirement system under which individuals 
        may contribute to the Thrift Savings Fund through withholdings 
        from pay.''.
            (2) Clerical amendment.--The table of sections for chapter 
        84 of title 5, United States Code, is amended by inserting 
        before the item relating to section 8432 the following:

``8431. Certain transfers to be treated as a separation.''.
    (b) Conforming Amendments.--Subsection (b) of section 8351 of title 
5, United States Code, is amended by redesignating paragraph (11) as 
paragraph (8), and by adding at the end the following:
            ``(9) For the purpose of this section, separation from 
        Government employment includes a transfer described in section 
        8431.''.
    (c) Effective Date.--The amendments made by this section shall 
apply with respect to transfers occurring before, on, or after the date 
of enactment of this Act, except that, for purposes of applying such 
amendments with respect to any transfer occurring before such date of 
enactment, the date of such transfer shall be considered to be the date 
of enactment of this Act. The Executive Director (within the meaning of 
section 8401(13) of title 5, United States Code) may prescribe any 
regulations necessary to carry out this subsection.
                                 <all>