[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[S. 2651 Introduced in Senate (IS)]







107th CONGRESS
  2d Session
                                S. 2651

  To provide for reform relating to Federal employment, and for other 
                               purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             June 20, 2002

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

_______________________________________________________________________

                                 A BILL


 
  To provide for reform relating to Federal employment, and for other 
                               purposes.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Federal Workforce 
Improvement Act of 2002''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
                 TITLE I--CHIEF HUMAN CAPITAL OFFICERS

Sec. 101. Short title.
Sec. 102. Agency Chief Human Capital Officers.
Sec. 103. Chief Human Capital Officers Council.
Sec. 104. Strategic human capital management.
Sec. 105. Effective date.
     TITLE II--REFORMS RELATING TO FEDERAL HUMAN CAPITAL MANAGEMENT

Sec. 201. Inclusion of agency human capital strategic planning in 
                            performance plans and program performance 
                            reports.
Sec. 202. Reform of the competitive service hiring process.
Sec. 203. Permanent extension, revision, and expansion of authorities 
                            for use of voluntary separation incentive 
                            pay and voluntary early retirement.
Sec. 204. Streamlined critical pay authority.
Sec. 205. Recruitment, relocation, and retention bonuses.
Sec. 206. Corrections relating to pay administration.
Sec. 207. Civil Service Retirement System computation for part-time 
                            service.
Sec. 208. Student volunteer transit subsidy.
      TITLE III--REFORMS RELATING TO THE SENIOR EXECUTIVE SERVICE

Sec. 301. Repeal of recertification requirements of senior executives.
Sec. 302. Adjustment of limitation on total annual compensation.
Sec. 303. Expanded Senior Executive Service limited appointment 
                            authority.
 TITLE IV--REFORMS RELATING TO FEDERAL EMPLOYEE CAREER DEVELOPMENT AND 
                                BENEFITS

Sec. 401. Agency training.
Sec. 402. Annual leave enhancements.
Sec. 403. Modifications to National Security Education Program.
        TITLE V--FEDERAL HUMAN RESOURCES MANAGEMENT INNOVATIONS

Sec. 501. Streamlined personnel management demonstration projects.
Sec. 502. Effective date.

                 TITLE I--CHIEF HUMAN CAPITAL OFFICERS

SEC. 101. SHORT TITLE.

    This title may be cited as the ``Chief Human Capital Officers Act 
of 2002''.

SEC. 102. AGENCY CHIEF HUMAN CAPITAL OFFICERS.

    (a) In General.--Part II of title 5, United States Code, is amended 
by inserting after chapter 13 the following:

           ``CHAPTER 14--AGENCY CHIEF HUMAN CAPITAL OFFICERS


``Sec.
``1401. Establishment of agency Chief Human Capital Officers.
``1402. Authority and functions of agency Chief Human Capital Officers.
``Sec. 1401. Establishment of agency Chief Human Capital Officers
    ``The head of each Executive agency, other than the General 
Accounting Office, shall appoint or designate a Chief Human Capital 
Officer, who shall--
            ``(1) advise and assist the head of the agency and other 
        agency officials in carrying out the agency's responsibilities 
        for selecting, developing, and managing a high-quality, 
        productive workforce in accordance with merit system 
        principles; and
            ``(2) implement the rules and regulations of the President 
        and the Office of Personnel Management and the laws governing 
        the civil service within the agency.
``Sec. 1402. Authority and functions of agency Chief Human Capital 
              Officers
    ``(a) The functions of each Chief Human Capital Officer shall 
include--
            ``(1) setting the workforce development strategy of the 
        agency;
            ``(2) assessing workforce characteristics and future needs 
        based on the agency's mission and strategic plan;
            ``(3) aligning the agency's human resources policies and 
        programs with organization mission, strategic goals, and 
        performance outcomes;
            ``(4) developing and advocating a culture of continuous 
        learning to attract and retain employees with superior 
        abilities;
            ``(5) identifying best practices and benchmarking studies; 
        and
            ``(6) applying methods for measuring intellectual capital 
        and identifying links of that capital to organizational 
        performance and growth.
    ``(b) In addition to the authority otherwise provided by this 
section, each agency Chief Human Capital Officer--
            ``(1) shall have access to all records, reports, audits, 
        reviews, documents, papers, recommendations, or other material 
        that--
                    ``(A) are the property of the agency or are 
                available to the agency; and
                    ``(B) relate to programs and operations with 
                respect to which that agency Chief Human Capital 
                Officer has responsibilities under this chapter; and
            ``(2) may request such information or assistance as may be 
        necessary for carrying out the duties and responsibilities 
        provided by this chapter from any Federal, State, or local 
        governmental entity.''.
    (b) Technical and Conforming Amendment.--The table of chapters for 
part II of title 5, United States Code, is amended by inserting after 
the item relating to chapter 13 the following:

``14. Chief Human Capital Officers..........................    1401''.

SEC. 103. CHIEF HUMAN CAPITAL OFFICERS COUNCIL.

    (a) Establishment.--There is established a Chief Human Capital 
Officers Council, consisting of--
            (1) the Director of the Office of Personnel Management, who 
        shall act as chairperson of the Council;
            (2) the Deputy Director for Management of the Office of 
        Management and Budget, who shall act as vice chairperson of the 
        Council; and
            (3) the Chief Human Capital Officers of Executive 
        departments and any other members who are designated by the 
        Director of the Office of Personnel Management.
    (b) Functions.--The Chief Human Capital Officers Council shall meet 
periodically to advise and coordinate the activities of the agencies of 
its members on such matters as modernization of human resources 
systems, improved quality of human resources information, and 
legislation affecting human resources operations and organizations.
    (c) Employee Labor Organizations at Meetings.--The Chief Human 
Capital Officers Council shall ensure that representatives of Federal 
employee labor organizations are present at a minimum of 1 meeting of 
the Council each year. Such representatives shall not be members of the 
Council.
    (d) Annual Report.--Each year the Chief Human Capital Officers 
Council shall submit a report to Congress on the activities of the 
Council.

SEC. 104. STRATEGIC HUMAN CAPITAL MANAGEMENT.

    Section 1103 of title 5, United States Code, is amended by adding 
at the end the following:
    ``(c)(1) The Office of Personnel Management shall design a set of 
systems, including appropriate metrics, for assessing the management of 
human capital by Federal agencies.
    ``(2) The systems referred to under paragraph (1) shall be defined 
in regulations of the Office of Personnel Management and include 
standards for--
            ``(A)(i) aligning human capital strategies of agencies with 
        the missions, goals, and organizational objectives of those 
        agencies; and
            ``(ii) integrating those strategies into the budget and 
        strategic plans of those agencies;
            ``(B) closing skill gaps in mission critical occupations;
            ``(C) ensuring continuity of effective leadership through 
        implementation of recruitment, development, and succession 
        plans;
            ``(D) sustaining a culture that differentiates between high 
        and low performers and provides appropriate incentives and 
        awards;
            ``(E) developing and implementing a knowledge management 
        strategy supported by appropriate investment in training and 
        technology; and
            ``(F) holding managers and human resources officers 
        accountable for efficient and effective human resources 
        management in support of agency missions in accordance with 
        merit system principles.''.

SEC. 105. EFFECTIVE DATE.

    This title shall take effect 180 days after the date of enactment 
of this Act.

     TITLE II--REFORMS RELATING TO FEDERAL HUMAN CAPITAL MANAGEMENT

SEC. 201. INCLUSION OF AGENCY HUMAN CAPITAL STRATEGIC PLANNING IN 
              PERFORMANCE PLANS AND PROGRAM PERFORMANCE REPORTS.

    (a) Performance Plans.--Section 1115(a) of title 31, United States 
Code, is amended by striking paragraph (3) and inserting the following:
            ``(3) provide a description of how the performance goals 
        and objectives are to be achieved, including the operational 
        processes, training, skills and technology, and the human, 
        capital, information, and other resources and strategies 
        required to meet those performance goals and objectives.''.
    (b) Program Performance Reports.--Section 1116(d) of title 31, 
United States Code, is amended--
            (1) in paragraph (4), by striking ``and'' after the 
        semicolon;
            (2) by redesignating paragraph (5) as paragraph (6); and
            (3) by inserting after paragraph (4) the following:
            ``(5) include a review of the performance goals and 
        evaluation of the performance plan relative to the agency's 
        strategic human capital management; and''.

SEC. 202. REFORM OF THE COMPETITIVE SERVICE HIRING PROCESS.

    (a) In General.--Chapter 33 of title 5, United States Code, is 
amended--
            (1) in section 3304(a)--
                    (A) in paragraph (1), by striking ``and'' after the 
                semicolon;
                    (B) in paragraph (2), by striking the period and 
                inserting ``; and''; and
                    (C) by adding at the end the following:
            ``(3) authority for agencies to appoint, without regard to 
        the provisions of sections 3309 through 3318, candidates 
        directly to positions for which--
                    ``(A) public notice has been given; and
                    ``(B) the Office of Personnel Management has 
                determined that there exists a severe shortage of 
                candidates or there is a critical hiring need.
The Office shall prescribe, by regulation, criteria for identifying 
such positions and may delegate authority to make determinations under 
such criteria.''; and
            (2) by inserting after section 3318 the following:
``Sec. 3319. Alternative ranking and selection procedures
    ``(a) Notwithstanding section 2302(b)(11) or any other provision of 
this chapter--
            ``(1) the Office, in exercising its authority under section 
        3304; or
            ``(2) an agency to which the Office has delegated examining 
        authority under section 1104(a)(2);
may establish category rating systems for evaluating applicants for 
positions in the competitive service, under which qualified candidates 
are divided into 2 or more quality categories, consistent with 
regulations prescribed by the Office of Personnel Management, rather 
than assigned individual numerical ratings.
    ``(b) Within each quality category established under subsection 
(a), preference-eligibles shall be listed ahead of individuals who are 
not preference eligibles. For other than scientific and professional 
positions at GS-9 of the General Schedule (equivalent or higher), 
qualified preference-eligibles who have a compensable service-connected 
disability of 10 percent or more shall be listed in the highest quality 
category.
    ``(c)(1) An appointing official may select any applicant in the 
highest quality category or, if fewer than 3 candidates have been 
assigned to the highest quality category, in a merged category 
consisting of the highest and the second highest quality categories.
    ``(2) Notwithstanding paragraph (1), the appointing official may 
not pass over a preference-eligible in the same category from which 
selection is made, unless the requirements of section 3317(b) or 
3318(b), as applicable, are satisfied.
    ``(d) Each agency that establishes a category rating system under 
this section shall submit in each of the 3 years following that 
establishment, a report to Congress on that system including 
information on--
            ``(1) the number of employees hired under that system; and
            ``(2) the way in which managers were trained in the 
        administration of that system.
    ``(e) The Office of Personnel Management may prescribe such 
regulations as it considers necessary to carry out the provisions of 
this section.''.
    (b) Terminal and Conforming Amendment.--The table of sections for 
chapter 33 of title 5, United States Code, is amended by striking the 
item relating to section 3319 and inserting the following:

``3319. Alternative ranking and selection procedures.''.

SEC. 203. PERMANENT EXTENSION, REVISION, AND EXPANSION OF AUTHORITIES 
              FOR USE OF VOLUNTARY SEPARATION INCENTIVE PAY AND 
              VOLUNTARY EARLY RETIREMENT.

    (a) Voluntary Separation Incentive Payments.--
            (1) In general.--
                    (A) Amendment to title 5, united states code.--
                Chapter 35 of title 5, United States Code, is amended 
                by inserting after subchapter I the following:

        ``SUBCHAPTER II--VOLUNTARY SEPARATION INCENTIVE PAYMENTS

``Sec. 3521. Definitions
    ``In this subchapter, the term--
            ``(1) `agency' means an Executive agency as defined under 
        section 105; and
            ``(2) `employee'--
                    ``(A) means an employee as defined under section 
                2105 employed by an agency and an individual employed 
                by a county committee established under section 8(b)(5) 
                of the Soil Conservation and Domestic Allotment Act (16 
                U.S.C. 590h(b)(5)) who--
                            ``(i) is serving under an appointment 
                        without time limitation; and
                            ``(ii) has been currently employed for a 
                        continuous period of at least 3 years; and
                    ``(B) shall not include--
                            ``(i) a reemployed annuitant under 
                        subchapter III of chapter 83 or 84 or another 
                        retirement system for employees of the 
                        Government;
                            ``(ii) an employee having a disability on 
                        the basis of which such employee is or would be 
                        eligible for disability retirement under 
                        subchapter III of chapter 83 or 84 or another 
                        retirement system for employees of the 
                        Government;
                            ``(iii) an employee who is in receipt of a 
                        decision notice of involuntary separation for 
                        misconduct or unacceptable performance;
                            ``(iv) an employee who has previously 
                        received any voluntary separation incentive 
                        payment from the Federal Government under this 
                        subchapter or any other authority;
                            ``(v) an employee covered by statutory 
                        reemployment rights who is on transfer 
                        employment with another organization; or
                            ``(vi) any employee who--
                                    ``(I) during the 36-month period 
                                preceding the date of separation of 
                                that employee, performed service for 
                                which a student loan repayment benefit 
                                was or is to be paid under section 
                                5379;
                                    ``(II) during the 24-month period 
                                preceding the date of separation of 
                                that employee, performed service for 
                                which a recruitment or relocation bonus 
                                was or is to be paid under section 
                                5753; or
                                    ``(III) during the 12-month period 
                                preceding the date of separation of 
                                that employee, performed service for 
                                which a retention bonus was or is to be 
                                paid under section 5754.
``Sec. 3522. Agency plans; approval
    ``(a) Before obligating any resources for voluntary separation 
incentive payments, the head of each agency shall submit to the Office 
of Personnel Management a plan outlining the intended use of such 
incentive payments and a proposed organizational chart for the agency 
once such incentive payments have been completed.
    ``(b) The plan of an agency under subsection (a) shall include--
            ``(1) the specific positions and functions to be reduced or 
        eliminated;
            ``(2) a description of which categories of employees will 
        be offered incentives;
            ``(3) the time period during which incentives may be paid;
            ``(4) the number and amounts of voluntary separation 
        incentive payments to be offered; and
            ``(5) a description of how the agency will operate without 
        the eliminated positions and functions.
    ``(c) The Director of the Office of Personnel Management shall 
review each agency's plan and may make any appropriate modifications in 
the plan, in consultation with the Director of the Office of Management 
and Budget. A plan under this section may not be implemented without 
the approval of the Director of the Office of Personnel Management.
``Sec. 3523. Authority to provide voluntary separation incentive 
              payments
    ``(a) A voluntary separation incentive payment under this 
subchapter may be paid to an employee only as provided in the plan of 
an agency established under section 3522.
    ``(b) A voluntary incentive payment--
            ``(1) shall be offered to agency employees on the basis 
        of--
                    ``(A) 1 or more organizational units;
                    ``(B) 1 or more occupational series or levels;
                    ``(C) 1 or more geographical locations;
                    ``(D) skills, knowledge, or other factors related 
                to a position;
                    ``(E) specific periods of time during which 
                eligible employees may elect a voluntary incentive 
                payment; or
                    ``(F) any appropriate combination of such factors;
            ``(2) shall be paid in a lump sum after the employee's 
        separation;
            ``(3) shall be equal to the lesser of--
                    ``(A) an amount equal to the amount the employee 
                would be entitled to receive under section 5595(c) if 
                the employee were entitled to payment under such 
                section (without adjustment for any previous payment 
                made); or
                    ``(B) an amount determined by the agency head, not 
                to exceed $25,000;
            ``(4) may be made only in the case of an employee who 
        voluntarily separates (whether by retirement or resignation) 
        under this subchapter;
            ``(5) shall not be a basis for payment, and shall not be 
        included in the computation, of any other type of Government 
        benefit;
            ``(6) shall not be taken into account in determining the 
        amount of any severance pay to which the employee may be 
        entitled under section 5595, based on any other separation; and
            ``(7) shall be paid from appropriations or funds available 
        for the payment of the basic pay of the employee.
``Sec. 3524. Effect of subsequent employment with the Government
    ``(a) The term `employment'--
            ``(1) in subsection (b) includes employment under a 
        personal services contract (or other direct contract) with the 
        United States Government (other than an entity in the 
        legislative branch); and
            ``(2) in subsection (c) does not include employment under 
        such a contract.
    ``(b) An individual who has received a voluntary separation 
incentive payment under this subchapter and accepts any employment for 
compensation with the Government of the United States within 5 years 
after the date of the separation on which the payment is based shall be 
required to pay, before the individual's first day of employment, the 
entire amount of the incentive payment to the agency that paid the 
incentive payment.
    ``(c)(1) If the employment under this section is with an agency, 
other than the General Accounting Office, the United States Postal 
Service, or the Postal Rate Commission, the Director of the Office of 
Personnel Management may, at the request of the head of the agency, 
waive the repayment if--
            ``(A) the individual involved possesses unique abilities 
        and is the only qualified applicant available for the position; 
        or
            ``(B) in the case of an emergency involving a direct threat 
        to life or property, the individual--
                    ``(i) has skills directly related to resolving the 
                emergency; and
                    ``(ii) will serve on a temporary basis only so long 
                as that individual's services are made necessary by the 
                emergency.
    ``(2) If the employment under this section is with an entity in the 
legislative branch, the head of the entity or the appointing official 
may waive the repayment if the individual involved possesses unique 
abilities and is the only qualified applicant available for the 
position.
    ``(3) If the employment under this section is with the judicial 
branch, the Director of the Administrative Office of the United States 
Courts may waive the repayment if the individual involved possesses 
unique abilities and is the only qualified applicant available for the 
position.
``Sec. 3525. Regulations
    ``The Office of Personnel Management may prescribe regulations to 
carry out this subchapter.''.
                    (B) Technical and conforming amendments.--Chapter 
                35 of title 5, United States Code, is amended--
                            (i) by striking the chapter heading and 
                        inserting the following:

  ``CHAPTER 35--RETENTION PREFERENCE, VOLUNTARY SEPARATION INCENTIVE 
             PAYMENTS, RESTORATION, AND REEMPLOYMENT''; and

                            (ii) in the table of sections by inserting 
                        after the item relating to section 3504 the 
                        following:

        ``SUBCHAPTER II--VOLUNTARY SEPARATION INCENTIVE PAYMENTS

``3521. Definitions.
``3522. Agency plans; approval.
``3523. Authority to provide voluntary separation incentive payments.
``3524. Effect of subsequent employment with the Government.
``3525. Regulations.''.
            (2) Administrative office of the united states courts.--The 
        Director of the Administrative Office of the United States 
        Courts may, by regulation, establish a program substantially 
        similar to the program established under paragraph (1) for 
        individuals serving in the judicial branch.
            (3) Continuation of other authority.--Any agency exercising 
        any voluntary separation incentive authority in effect on the 
        effective date of this Act may continue to offer voluntary 
        separation incentives consistent with that authority until that 
        authority expires.
            (4) Effective date.--This subsection shall take effect 60 
        days after the date of enactment of this Act.
    (b) Federal Employee Voluntary Early Retirement.--
            (1) Civil service retirement system.--Section 8336(d)(2) of 
        title 5, United States Code, is amended to read as follows:
            ``(2)(A) has been employed continuously, by the agency in 
        which the employee is serving, for at least the 31-day period 
        ending on the date on which such agency requests the 
        determination referred to in subparagraph (D);
            ``(B) is serving under an appointment that is not time 
        limited;
            ``(C) has not been duly notified that such employee is to 
        be involuntarily separated for misconduct or unacceptable 
        performance;
            ``(D) is separated from the service voluntarily during a 
        period in which, as determined by the Office of Personnel 
        Management (upon request of the agency) under regulations 
        prescribed by the Office--
                    ``(i) such agency (or, if applicable, the component 
                in which the employee is serving) is undergoing 
                delayering, reorganization, reduction in force, or 
                transfer of function, or other workforce restructuring 
                (or shaping); and
                    ``(ii) employees serving in such agency (or 
                component) are likely to be separated or subject to an 
                immediate reduction in the rate of basic pay (without 
                regard to subchapter VI of chapter 53, or comparable 
                provisions); or
                    ``(iii) identified as being in positions which are 
                becoming surplus or excess to the agency's future 
                ability to carry out its mission effectively; and
            ``(E) as determined by the agency under regulations 
        prescribed by the Office, is within the scope of the offer of 
        voluntary early retirement, which may be made on the basis of--
                    ``(i) 1 or more organizational units;
                    ``(ii) 1 or more occupational series or levels;
                    ``(iii) 1 or more geographical locations;
                    ``(iv) specific periods;
                    ``(v) skills, knowledge, or other factors related 
                to a position; or
                    ``(vi) any appropriate combination of such 
                factors;''.
            (2) Federal employees' retirement system.--Section 
        8414(b)(1) of title 5, United States Code, is amended by 
        striking subparagraph (B) and inserting the following:
                    ``(B)(i) has been employed continuously, by the 
                agency in which the employee is serving, for at least 
                the 31-day period ending on the date on which such 
                agency requests the determination referred to in clause 
                (iv);
                    ``(ii) is serving under an appointment that is not 
                time limited;
                    ``(iii) has not been duly notified that such 
                employee is to be involuntarily separated for 
                misconduct or unacceptable performance;
                    ``(iv) is separated from the service voluntarily 
                during a period in which, as determined by the Office 
                of Personnel Management (upon request of the agency) 
                under regulations prescribed by the Office--
                            ``(I) such agency (or, if applicable, the 
                        component in which the employee is serving) is 
                        undergoing delayering, reorganization, 
                        reduction in force, or transfer of function, or 
                        other workforce restructuring (or shaping); and
                            ``(II) employees serving in such agency (or 
                        component) are likely to be separated or 
                        subject to an immediate reduction in the rate 
                        of basic pay (without regard to subchapter VI 
                        of chapter 53, or comparable provisions); or
                            ``(III) identified as being in positions 
                        which are becoming surplus or excess to the 
                        agency's future ability to carry out its 
                        mission effectively; and
                    ``(v) as determined by the agency under regulations 
                prescribed by the Office, is within the scope of the 
                offer of voluntary early retirement, which may be made 
                on the basis of--
                            ``(I) 1 or more organizational units;
                            ``(II) 1 or more occupational series or 
                        levels;
                            ``(III) 1 or more geographical locations;
                            ``(IV) specific periods;
                            ``(V) skills, knowledge, or other factors 
                        related to a position; or
                            ``(VI) any appropriate combination of such 
                        factors;''.
            (3) General accounting office authority.--The amendments 
        made by this subsection shall not be construed to affect the 
        authority under section 1 of Public Law 106-303 (5 U.S.C. 8336 
        note; 114 Stat. 1063).
            (4) Technical and conforming amendment.--Section 7001 of 
        the 1998 Supplemental Appropriations and Rescissions Act 
        (Public Law 105-174; 112 Stat. 91) is repealed.
            (5) Regulations.--The Office of Personnel Management may 
        prescribe regulations to carry out this subsection.
    (c) Sense of Congress.--It is the sense of Congress that the 
implementation of this section is intended to reshape the Federal 
workforce and not downsize the Federal workforce.

SEC. 204. STREAMLINED CRITICAL PAY AUTHORITY.

    (a) In General.--Section 5377 of title 5, United States Code, is 
amended--
            (1) by striking subsection (c) and inserting the following:
    ``(c) The Office of Personnel Management, in consultation with the 
Office of Management and Budget, may, upon the request of the head of 
an agency, grant authority to fix the rate of basic pay for 1 or more 
positions in such agency in accordance with this section.'';
            (2) in subsection (e)(1), by striking ``Office of 
        Management and Budget'' and inserting ``Office of Personnel 
        Management'';
            (3) by striking subsections (f) and (g) and inserting the 
        following:
    ``(f) The Office of Personnel Management may not authorize the 
exercise of authority under this section with respect to more than 800 
positions at any 1 time, of which not more than 30 may, at any such 
time, be positions the rate of basic pay for which would otherwise be 
determined under subchapter II.
    ``(g) The Office of Personnel Management shall consult with the 
Office of Management and Budget before making any decision to grant or 
terminate any authority under this section.''; and
            (4) in subsection (h), by striking ``The Office of 
        Management and Budget shall report to the Committee on Post 
        Office and Civil Service'' and inserting ``The Office of 
        Personnel Management shall report to the Committee on 
        Government Reform.''.

SEC. 205. RECRUITMENT, RELOCATION, AND RETENTION BONUSES.

    (a) Bonuses.--
            (1) In general.--Chapter 57 of title 5, United States Code, 
        is amended by striking sections 5753 and 5754 and inserting the 
        following:
``Sec. 5753. Recruitment and relocation bonuses
    ``(a) In this section, the term `employee' has the meaning given 
that term under section 2105, except that such term also includes an 
employee described under subsection (c) of that section.
    ``(b)(1) The Office of Personnel Management may authorize the head 
of an agency to pay a bonus to an individual appointed or moved to a 
position that is likely to be difficult to fill in the absence of such 
a bonus, if the individual--
            ``(A)(i) is newly appointed as an employee of the Federal 
        Government; or
            ``(ii) is currently employed by the Federal Government and 
        moves to a new position in the same geographic area under 
        circumstances described in regulations of the Office; or
            ``(B) is currently employed by the Federal Government and 
        must relocate to accept a position stationed in a different 
        geographic area.
    ``(2) Except as provided by subsection (h), a bonus may be paid 
under this section only to an employee covered by the General Schedule 
pay system established under subchapter III of chapter 53.
    ``(c)(1) Payment of a bonus under this section shall be contingent 
upon the employee entering into a written service agreement to complete 
a period of employment with the agency, not to exceed 4 years. The 
Office may, by regulation, prescribe a minimum service.
    ``(2)(A) The agreement shall include--
            ``(i) the length of the required service period;
            ``(ii) the amount of the bonus;
            ``(iii) the method of payment; and
            ``(iv) other terms and conditions under which the bonus is 
        payable, subject to subsections (d) and (e) and regulations of 
        the Office.
    ``(B) The terms and conditions for paying a bonus, as specified in 
the service agreement, shall include--
            ``(i) the conditions under which the agreement may be 
        terminated before the agreed-upon service period has been 
        completed; and
            ``(ii) the effect of the termination.
    ``(3) The agreement shall be made effective upon employment with 
the agency or movement to a new position or geographic area, as 
applicable, except that a service agreement with respect to a 
recruitment bonus may be made effective at a later date under 
circumstances described in regulations of the Office, such as when 
there is an initial period of formal basic training.
    ``(d)(1) Except as provided in subsection (e), a bonus under this 
section shall not exceed 25 percent of the annual rate of basic pay of 
the employee at the beginning of the service period multiplied by the 
number of years (or fractions thereof) in the service period, not to 
exceed 4 years.
    ``(2) A bonus under this section may be paid as an initial lump 
sum, in installments, as a final lump sum upon the completion of the 
full service period, or in a combination of these forms of payment.
    ``(3) A bonus under this section is not part of the basic pay of an 
employee for any purpose.
    ``(4) Under regulations of the Office, a recruitment bonus under 
this section may be paid to an eligible individual before that 
individual enters on duty.
    ``(e) The Office may authorize the head of an agency to waive the 
limitation under subsection (d)(1) based on a critical agency need, 
subject to regulations prescribed by the Office. Under such a waiver, 
the amount of the bonus may be up to 50 percent of the employee's 
annual rate of basic pay at the beginning of the service period 
multiplied by the number of years (or fractions thereof) in the service 
period, not to exceed 100 percent of the employee's annual rate of 
basic pay at the beginning of the service period.
    ``(f) The Office shall require that, before paying a bonus under 
this section, an agency shall establish a plan for paying recruitment 
bonuses and a plan for paying relocation bonuses, subject to 
regulations prescribed by the Office.
    ``(g) The Office may prescribe regulations to carry out this 
section, including regulations relating to the repayment of a 
recruitment or relocation bonus in appropriate circumstances when the 
agreed-upon service period has not been completed.
    ``(h)(1) At the request of the head of an Executive agency, the 
Office may extend coverage under this section to categories of 
employees within the agency who otherwise would not be covered by this 
section.
    ``(2) The Office shall not extend coverage to the head of an 
Executive agency, including an Executive agency headed by a board or 
other collegial body composed of 2 or more individual members.
``Sec. 5754. Retention bonuses
    ``(a) In this section, the term `employee' has the meaning given 
that term under section 2105, except that such term also includes an 
employee described in subsection (c) of that section.
    ``(b) The Office of Personnel Management may authorize the head of 
an agency to pay a retention bonus to an employee, subject to 
regulations prescribed by the Office, if--
            ``(1) the unusually high or unique qualifications of the 
        employee or a special need of the agency for the employee's 
        services makes it essential to retain the employee; and
            ``(2) the agency determines that, in the absence of a 
        retention bonus, the employee would be likely to leave--
                    ``(A) the Federal service; or
                    ``(B) for a different position in the Federal 
                service under conditions described in regulations of 
                the Office.
    ``(c) The Office may authorize the head of an agency to pay 
retention bonuses to a group of employees in 1 or more categories of 
positions in 1 or more geographic areas, subject to the requirements of 
subsection (b)(1) and regulations prescribed by the Office, if there is 
a high risk that a significant portion of employees in the group would 
be likely to leave in the absence of retention bonuses.
    ``(d) Except as provided in subsection (j), a bonus may be paid 
only to an employee covered by the General Schedule pay system 
established under subchapter III of chapter 53.
    ``(e)(1) Payment of a retention bonus is contingent upon the 
employee entering into a written service agreement with the agency to 
complete a period of employment with the agency.
    ``(2)(A) The agreement shall include--
            ``(i) the length of the required service period;
            ``(ii) the amount of the bonus;
            ``(iii) the method of payment; and
            ``(iv) other terms and conditions under which the bonus is 
        payable, subject to subsections (f) and (g) and regulations of 
        the Office.
    ``(B) The terms and conditions for paying a bonus, as specified in 
the service agreement, shall include--
            ``(i) the conditions under which the agreement may be 
        terminated before the agreed-upon service period has been 
        completed; and
            ``(ii) the effect of the termination.
    ``(3)(A) Notwithstanding paragraph (1), a written service agreement 
is not required if the agency pays a retention bonus in biweekly 
installments and sets the installment payment at the full bonus 
percentage rate established for the employee with no portion of the 
bonus deferred.
    ``(B) If an agency pays a retention bonus in accordance with 
subparagraph (A) and makes a determination to terminate the payments, 
the agency shall provide written notice to the employee of that 
determination. Except as provided in regulations of the Office, the 
employee shall continue to be paid the retention bonus through the end 
of the pay period in which such written notice is provided.
    ``(4) A retention bonus for an employee may not be based on any 
period of such service which is the basis for a recruitment or 
relocation bonus under section 5753.
    ``(f)(1) Except as provided in subsection (g), a retention bonus, 
which shall be stated as a percentage of the employee's basic pay for 
the service period associated with the bonus, may not exceed--
            ``(A) 25 percent of the employee's basic pay if paid under 
        subsection (b); or
            ``(B) 10 percent of an employee's basic pay if paid under 
        subsection (c).
    ``(2) A retention bonus may be paid to an employee in installments 
after completion of specified periods of service or in a single lump 
sum at the end of the full period of service required by the agreement. 
An installment payment may not exceed the product derived from 
multiplying the amount of basic pay earned in the installment period by 
a percentage not to exceed the bonus percentage rate established for 
the employee. If the installment payment percentage is less than the 
bonus percentage rate, the accrued but unpaid portion of the bonus is 
payable as part of the final installment payment to the employee after 
completion of the full service period under the terms of the service 
agreement.
    ``(3) A retention bonus is not part of the basic pay of an employee 
for any purpose.
    ``(g) Upon the request of the head of an agency, the Office may 
waive the limit established under subsection (f)(1) and permit the 
agency head to pay an otherwise eligible employee or category of 
employees retention bonuses of up to 50 percent of basic pay, based on 
a critical agency need.
    ``(h) The Office shall require that, before paying a bonus under 
this section, an agency shall establish a plan for paying retention 
bonuses, subject to regulations prescribed by the Office.
    ``(i) The Office may prescribe regulations to carry out this 
section.
    ``(j)(1) At the request of the head of an Executive agency, the 
Office may extend coverage under this section to categories of 
employees within the agency who otherwise would not be covered by this 
section.
    ``(2) The Office shall not extend coverage under this section to 
the head of an Executive agency, including an Executive agency headed 
by a board or other collegial body composed of 2 or more individual 
members.''.
            (2) Technical and conforming amendment.--The table of 
        sections for chapter 57 of title 5, United States Code, is 
        amended by striking the item relating to section 5754 and 
        inserting the following:

``5754. Retention bonuses.''.
    (b) Relocation Payments.--Section 407 of the Federal Employees Pay 
Comparability Act of 1990 (5 U.S.C. 5305 note; 104 Stat. 1467) is 
repealed.
    (c) Effective Date and Application.--
            (1) Effective date.--Except as provided under paragraphs 
        (2) and (3), this section shall take effect on the first day of 
        the first applicable pay period beginning on or after 180 days 
        after the date of enactment of this Act.
            (2) Application to agreements.--A recruitment or relocation 
        bonus service agreement that was authorized under section 5753 
        of title 5, United States Code, before the effective date under 
        paragraph (1) shall continue, until its expiration, to be 
        subject to section 5753 as in effect on the day before such 
        effective date.
            (3) Application to allowances.--Payment of a retention 
        allowance that was authorized under section 5754 of title 5, 
        United States Code, before the effective date under paragraph 
        (1) shall continue, subject to section 5754 as in effect on the 
        day before such effective date, until the retention allowance 
        is reauthorized or terminated (but no longer than 1 year after 
        such effective date).

SEC. 206. CORRECTIONS RELATING TO PAY ADMINISTRATION.

    (a) In General.--Chapter 53 of title 5, United States Code, is 
amended--
            (1) in section 5302, by striking paragraph (8) and 
        inserting the following:
            ``(8) the term `rates of pay under the General Schedule', 
        `rates of pay for the General Schedule', or `scheduled rates of 
        basic pay' means the unadjusted rates of basic pay in the 
        General Schedule as established by section 5332, excluding 
        additional pay of any kind; and'';
            (2) in section 5305--
                    (A) by striking subsection (a) and inserting the 
                following:
    ``(a)(1) Whenever the Office of Personnel Management finds that the 
Government's recruitment or retention efforts with respect to 1 or more 
occupations in 1 or more areas or locations are, or are likely to 
become, significantly handicapped due to any of the circumstances 
described in subsection (b), the Office may establish for the areas or 
locations involved, with respect to individuals in positions paid under 
any of the pay systems referred to in subsection (c), higher minimum 
rates of pay for 1 or more grades or levels, occupational groups, 
series, classes, or subdivisions thereof, and may make corresponding 
increases in all rates of pay range for each such grade or level. 
However, a minimum rate so established may not exceed the maximum rate 
of basic pay (excluding any locality-based comparability payment under 
section 5304 or similar provision of law) for the grade or level by 
more than 30 percent, and no rate may be established under this section 
in excess of the rate of basic pay payable for level IV of the 
Executive Schedule. In the case of individuals not subject to the 
provisions of this title governing appointment in the competitive 
service, the President may designate another agency to authorize 
special rates under this section.
    ``(2) The head of an agency may determine that a category of 
employees of the agency will not be covered by a special rate 
authorization established under this section. The head of an agency 
shall provide written notice to the Office of Personnel Management (or 
other agency designated by the President to authorize special rates) 
which identifies the specific category or categories of employees that 
will not be covered by special rates authorized under this section. If 
the head of an agency removes a category of employees from coverage 
under a special rate authorization after that authorization takes 
effect, the loss of coverage will take effect on the first day of the 
first pay period after the date of the notice.'';
                    (B) in subsection (b), by striking paragraph (4) 
                and inserting the following:
            ``(4) any other circumstances which the Office of Personnel 
        Management (or such agency as the President may designate) 
        considers appropriate.'';
                    (C) in subsection (d)--
                            (i) by striking ``President'' and inserting 
                        ``Office of Personnel Management''; and
                            (ii) by striking ``he'' and inserting ``the 
                        President'';
                    (D) in subsection (e), by striking ``basic pay'' 
                and inserting ``pay'';
                    (E) by striking subsection (f) and inserting the 
                following:
    ``(f) When a schedule of special rates established under this 
section is adjusted under subsection (d), a covered employee's special 
rate will be adjusted in accordance with conversion rules prescribed by 
the Office of Personnel Management or by such agency as the President 
may designate.'';
                    (F) in subsection (g)(1)--
                            (i) by striking ``basic pay'' and inserting 
                        ``pay''; and
                            (ii) by striking ``President (or his 
                        designated agency)'' and inserting ``Office of 
                        Personnel Management (or such agency as the 
                        President may designate)'';
                    (G) by striking subsection (h) and inserting the 
                following:
    ``(h) An employee's entitlement to a rate of pay established under 
this section terminates when the employee is entitled to a higher rate 
of pay (including basic pay as adjusted to include any locality-based 
comparability payment under section 5304 or similar provision of 
law).''; and
                    (H) by adding at the end the following:
    ``(i) When an employee who is receiving a rate of pay established 
under this section moves to a new official duty station at which 
different pay schedules apply, the employee shall be entitled to the 
rates of pay applicable in the new pay area based on the employee's 
position, grade, and step (or relative position in the rate range) 
before the movement, as determined under regulations prescribed by the 
Office of Personnel Management or other agency designated by the 
President under subsection (a). Such pay conversion upon geographic 
movement shall be effected before processing any other simultaneous pay 
action (other than a general pay adjustment).
    ``(j) A rate established under this section shall be considered to 
be part of basic pay for purposes of subchapter III of chapter 83, 
chapter 84, chapter 87, subchapter V of chapter 55, section 5941, and 
for such other purposes as may be expressly provided for by law or as 
the Office of Personnel Management may by regulation prescribe.'';
            (3) in section 5334--
                    (A) in subsection (b), by adding at the end the 
                following:
``If an employee's rate after promotion or transfer is greater than the 
maximum rate of basic pay for the employee's grade, that rate shall be 
treated as a retained rate under section 5363. The Office of Personnel 
Management shall prescribe by regulation the circumstances under which 
and the extent to which special rates under section 5305 (or similar 
provision of law) or locality-adjusted rates under section 5304 (or 
similar provision of law) are considered to be basic pay in applying 
this subsection.''; and
                    (B) by adding at the end the following:
    ``(g) When an employee moves to a new official duty station at 
which different pay schedules apply, the employee shall be entitled to 
the rates of pay applicable in the new pay area based on the employee's 
position, grade, and step (or relative position in the rate range) 
before the movement. Such pay conversion upon geographic movement shall 
be effected before processing any other simultaneous pay action (other 
than a general pay adjustment).'';
            (4) in section 5361--
                    (A) by striking paragraphs (3) and (4) and 
                redesignating paragraphs (5) through (7) as paragraphs 
                (3) through (5), respectively;
                    (B) in paragraph (4), as redesignated, by striking 
                ``and'' at the end;
                    (C) in paragraph (5), as redesignated, by striking 
                the period and inserting a semicolon; and
                    (D) by adding at the end the following:
            ``(6) `rate of basic pay' means--
                    ``(A) the rate of pay prescribed by law (including 
                regulations) for the position held by an employee 
                before any deductions or additions of any kind, but 
                including--
                            ``(i) any applicable locality-based payment 
                        under section 5304 or similar provision of law;
                            ``(ii) any applicable special salary rate 
                        under section 5305 or similar provision of law; 
                        and
                            ``(iii) any applicable existing retained 
                        rate of pay established under section 5363 or 
                        similar provision of law; and
                    ``(B) in the case of a prevailing rate employee, 
                the scheduled rate of pay determined under section 
                5343;
            ``(7) `former highest applicable rate of basic pay' means 
        the highest applicable rate of basic pay payable to the 
        employee immediately before the action that triggers pay 
        retention under section 5363; and
            ``(8) `highest applicable basic pay rate range' means the 
        range of rates of basic pay for the grade or level of the 
        employee's current position with the highest maximum rate, 
        except as otherwise provided in regulations prescribed by the 
        Office of Personnel Management in cases where another rate 
        range provides higher rates only in the lower portion of the 
        range.'';
            (5) in section 5363--
                    (A) in subsection (a), by amending the matter 
                following paragraph (4) to read as follows:
``is entitled to pay retention under the conditions set forth in this 
section. Notwithstanding any other provision of law, this section may 
not be applied to employees whose rate of basic pay is reduced solely 
because of the recomputation of pay upon movement to a new official 
duty station at which different pay schedules apply. When a geographic 
move is accompanied by a simultaneous pay action that reduces the 
employee's rate of basic pay after the employee's pay has been 
recomputed to reflect the geographic move, this section shall be 
applied, if otherwise applicable.''; and
                    (B) by striking subsections (b) and (c) and 
                inserting the following:
    ``(b)(1) If an employee is entitled to pay retention under 
subsection (a), paragraphs (2) and (3) shall apply in determining the 
employee's rate of pay:
    ``(2) If the employee's former highest applicable rate of basic pay 
is less than or equal to the maximum rate of the highest applicable 
basic pay rate range for the employee's current position, the employee 
is entitled to the lowest payable rate of basic pay in that rate range 
that equals or exceeds the former rate, and pay retention ceases to 
apply.
    ``(3) If the employee's former highest applicable rate of basic pay 
exceeds the maximum rate of the highest applicable basic pay rate range 
for the employee's current position, the employee is entitled to a 
retained rate equal to the lesser of--
            ``(A) the employee's former highest applicable rate of 
        basic pay; or
            ``(B) 150 percent of the maximum rate of the highest 
        applicable basic pay rate range for the employee's position.
    ``(c) An employee's retained rate shall be increased at the time of 
any increase in the maximum rate of the highest applicable basic pay 
rate range for the employee's position by 50 percent of the dollar 
increase in that maximum rate.
    ``(d) The rate of pay for an employee who is receiving a retained 
rate under this section and who is moved to a new official duty station 
at which different pay schedules apply shall be determined under 
regulations prescribed by the Office of Personnel Management consistent 
with the purposes of this section.
    ``(e) A retained rate shall be considered part of basic pay for 
purposes of this subchapter and for purposes of subchapter III of 
chapter 83, chapters 84 and 87, subchapter V of chapter 55, section 
5941, and for such other purposes as may be expressly provided for by 
law or as the law or as the Office of Personnel Management may by 
regulation prescribe. For other purposes, the Office shall prescribe by 
regulation what constitutes basic pay for employees receiving a 
retained rate.
    ``(f) Subsections (a) through (e) do not apply (or shall cease to 
apply) to an employee who--
            ``(1) has a break in service of 1 workday or more;
            ``(2) is entitled by operation of this subchapter or 
        chapter 51 or 53 to a rate of basic pay which is equal to or 
        higher than, or declines a reasonable offer of a position the 
        rate of basic pay for which is equal to or higher than, the 
        rate to which the employee is entitled under this section; or
            ``(3) is demoted for personal cause or at the employee's 
        request.''; and
            (6) in section 5365(b) by inserting after ``provisions of 
        this subchapter'' the following: ``(subject to any conditions 
        or limitations the Office may establish)''.
    (b) Special Rates for Law Enforcement Officers.--Section 403(c) of 
the Federal Employees Pay Comparability Act of 1990 (5 U.S.C. 5305 
note; Public Law 101-509) is amended by striking all after ``provision 
of law)'' and inserting ``and shall be basic pay for all purposes. The 
rates shall be adjusted at the time of adjustments in the General 
Schedule to maintain the step linkage set forth in subsection 
(b)(2).''.
    (c) Pay Retention.--Subject to any regulations the Office of 
Personnel Management may prescribe, any employee in a covered pay 
schedule who is receiving a retained rate under section 5363 of title 
5, United States Code, or similar authority on the effective date of 
this Act shall have the pay of that employee converted on that date. 
The newly applicable retained rate shall equal the formerly applicable 
retained rate as adjusted to include any applicable locality-based 
payment under section 5304 of title 5, United States Code, or similar 
provision of law. Any employee in a covered pay system receiving a rate 
that exceeds the maximum rate of the highest applicable basic pay rate 
range for the employee's position (as defined under section 5361(8) of 
that title, as amended by this Act) under any authority shall be 
considered to be receiving a retained rate under section 5363 of that 
title.

SEC. 207. CIVIL SERVICE RETIREMENT SYSTEM COMPUTATION FOR PART-TIME 
              SERVICE.

    Section 8339(p) of title 5, United States Code, is amended by 
adding at the end the following:
            ``(3) In the administration of paragraph (1)--
                    ``(A) subparagraph (A) of such paragraph shall 
                apply to any service performed before, on, or after 
                April 7, 1986;
                    ``(B) subparagraph (B) of such paragraph shall 
                apply to all service performed on a part-time or full-
                time basis on or after April 7, 1986; and
                    ``(C) any service performed on a part-time basis 
                before April 7, 1986, shall be credited as service 
                performed on a full-time basis.''.

SEC. 208. STUDENT VOLUNTEER TRANSIT SUBSIDY.

    (a) In General.--Section 7905(a)(1) of title 5, United States Code, 
is amended by striking ``and a member of a uniformed service'' and 
inserting ``, a member of a uniformed service, and a student who 
provides voluntary services under section 3111''.
    (b) Technical and Conforming Amendment.--Section 3111(c)(1) of 
title 5, United States Code, is amended by striking ``chapter 81 of 
this title'' and inserting ``section 7905 (relating to commuting by 
means other than single-occupancy motor vehicles), chapter 81''.

      TITLE III--REFORMS RELATING TO THE SENIOR EXECUTIVE SERVICE

SEC. 301. REPEAL OF RECERTIFICATION REQUIREMENTS OF SENIOR EXECUTIVES.

    (a) In General.--Title 5, United States Code, is amended--
            (1) in chapter 33--
                    (A) in section 3393(g) by striking ``3393a,'';
                    (B) by repealing section 3393a; and
                    (C) in the table of sections by striking the item 
                relating to section 3393a;
            (2) in chapter 35--
                    (A) in section 3592(a)--
                            (i) in paragraph (1), by inserting ``or'' 
                        at the end;
                            (ii) in paragraph (2), by striking ``or'' 
                        at the end;
                            (iii) by striking paragraph (3); and
                            (iv) by striking the last sentence;
                    (B) in section 3593(a), by striking paragraph (2) 
                and inserting the following:
            ``(2) the appointee left the Senior Executive Service for 
        reasons other than misconduct, neglect of duty, malfeasance, or 
        less than fully successful executive performance as determined 
        under subchapter II of chapter 43.''; and
                    (C) in section 3594(b)--
                            (i) in paragraph (1), by inserting ``or'' 
                        at the end;
                            (ii) in paragraph (2), by striking ``or'' 
                        at the end; and
                            (iii) by striking paragraph (3);
            (3) in section 7701(c)(1)(A), by striking ``or removal from 
        the Senior Executive Service for failure to be recertified 
        under section 3393a'';
            (4) in chapter 83--
                    (A) in section 8336(h)(1), by striking ``for 
                failure to be recertified as a senior executive under 
                section 3393a or''; and
                    (B) in section 8339(h), in the first sentence, by 
                striking ``, except that such reduction shall not apply 
                in the case of an employee retiring under section 
                8336(h) for failure to be recertified as a senior 
                executive''; and
            (5) in chapter 84--
                    (A) in section 8414(a)(1), by striking ``for 
                failure to be recertified as a senior executive under 
                section 3393a or''; and
                    (B) in section 8421(a)(2), by striking ``, except 
                that an individual entitled to an annuity under section 
                8414(a) for failure to be recertified as a senior 
                executive shall be entitled to an annuity supplement 
                without regard to such applicable minimum retirement 
                age''.
    (b) Savings Provision.--Notwithstanding the amendments made by 
subsection (a)(2)(A), an appeal under the final sentence of section 
3592(a) of title 5, United States Code, that is pending on the day 
before the effective date of this section--
            (1) shall not abate by reason of the enactment of the 
        amendments made by subsection (a)(2)(A); and
            (2) shall continue as if such amendments had not been 
        enacted.
    (c) Application.--The amendment made by subsection (a)(2)(B) shall 
not apply with respect to an individual who, before the effective date 
of this section, leaves the Senior Executive Service for failure to be 
recertified as a senior executive under section 3393a of title 5, 
United States Code.

SEC. 302. ADJUSTMENT OF LIMITATION ON TOTAL ANNUAL COMPENSATION.

    Section 5307(a) of title 5, United States Code, is amended by 
adding at the end the following:
    ``(3) Notwithstanding paragraph (1), the total payment referred to 
under such paragraph with respect to an employee paid under section 
5376 or 5383 shall not exceed the total annual compensation payable to 
the Vice President under section 104 of title 3. Regulations prescribed 
under subsection (c) may extend the application of this paragraph to 
other equivalent categories of employees.''.

SEC. 303. EXPANDED SENIOR EXECUTIVE SERVICE LIMITED APPOINTMENT 
              AUTHORITY.

    (a) Definitions.--Section 3132 of title 5, United States Code, is 
amended--
            (1) in subsection (a)--
                    (A) by striking paragraph (5), and inserting the 
                following:
            ``(5) `limited appointee' means an individual appointed to 
        a Senior Executive Service position to meet a short-term 
        staffing need, as determined by the Office of Personnel 
        Management;'';
                    (B) by striking paragraph (6) and redesignating 
                paragraphs (7), (8), and (9) as paragraphs (6), (7), 
                and (8), respectively; and
                    (C) by amending paragraph (7) as so redesignated to 
                read as follows:
            ``(7) `career reserved position' means a position 
        designated under subsection (b) which may be filled only by--
                    ``(A) a career appointee; or
                    ``(B) a limited appointee who, immediately before 
                entering the career reserved position, was serving 
                under a career or career-conditional appointment 
                outside the Senior Executive Service (or an appointment 
                of equivalent tenure, as determined by the Office of 
                Personnel Management), or whose limited appointment to 
                a career reserved position is approved in advance by 
                the Office of Personnel Management;''; and
            (2) in subsection (b)(1), by striking ``For the purpose of 
        paragraph (8) of subsection (a) of this section,'' and 
        inserting ``For the purpose of paragraph (7) of subsection 
        (a),''.
    (b) Noncareer and Limited Appointments.--Section 3394 of title 5, 
United States Code, is amended to read as follows:
``Sec. 3394. Noncareer and limited appointments
    ``(a) Each noncareer appointee and limited appointee shall meet the 
qualifications of the position to which appointed, as determined in 
writing by the appointing authority.
    ``(b) An individual may not be appointed as a limited appointee 
without the prior approval of the exercise of such appointment 
authority by the Office of Personnel Management.
    ``(c) The duration of a limited appointment shall be--
            ``(1) 4 years or less to a Senior Executive Service 
        position the duties of which will expire at the end of such 
        term; or
            ``(2) 12 months or less to a Senior Executive Service 
        position the duties of which are continuing.
    ``(d) In rare circumstances, the Office of Personnel Management may 
authorize an extension of a limited appointment under--
            ``(1) subsection (c)(1) for a period not to exceed 2 years; 
        and
            ``(2) subsection (c)(2) for a period not to exceed 12 
        months.
    ``(e) A limited appointee who has been appointed from a career or 
career-conditional appointment outside the Senior Executive Service 
shall have reemployment rights in the agency from which appointed, or 
in another agency, under requirements and conditions established by the 
Office of Personnel Management. The Office shall have the authority to 
direct such placement in any agency.''.
    (c) Reassignment and Transfer.--Section 3395 of title 5, United 
States Code, is amended by striking subsections (b) and (c) and 
inserting the following:
    ``(b) Notwithstanding section 3394(b)--
            ``(1) a limited appointee serving under a term prescribed 
        under section 3394(c)(1) may be reassigned to another Senior 
        Executive Service position in the same agency, the duties of 
        which will expire at the end of a term of 4 years or less, 
        except that the appointee may not serve in 1 or more positions 
        in such agency under such appointment in excess of 4 years, 
        unless an extension has been approved by the Office; and
            ``(2) a limited appointee serving under a term prescribed 
        under section 3394(c)(2) may be reassigned to another 
        continuing Senior Executive Service position in the same 
        agency, except that the appointee may not serve in 1 or more 
        positions in such agency under such appointment in excess of 12 
        months, unless an extension has been approved by the Office.
    ``(c) A limited appointee may not serve more than 7 consecutive 
years under any combination of limited appointments.''.

 TITLE IV--REFORMS RELATING TO FEDERAL EMPLOYEE CAREER DEVELOPMENT AND 
                                BENEFITS

SEC. 401. AGENCY TRAINING.

    (a) Training To Accomplish Performance Plans and Strategic Goals.--
Section 4103 of title 5, United States Code, is amended by adding at 
the end the following:
    ``(c) The head of each agency shall--
            ``(1) evaluate each program or plan established, operated, 
        or maintained under subsection (a) with respect to 
        accomplishing specific performance plans and strategic goals in 
        performing the agency mission; and
            ``(2) modify such program or plan to accomplish such plans 
        and goals.''.
    (b) Agency Training Officer; Specific Training Programs.--
            (1) In general.--Chapter 41 of title 5, United States Code, 
        is amended by adding after section 4119 the following:
``Sec. 4120. Agency training officer
    ``Each agency shall appoint or designate a training officer who 
shall be responsible for developing, coordinating, and administering 
training for the agency.
``Sec. 4121. Specific training programs
    ``In consultation with the Office of Personnel Management, each 
head of an agency shall establish--
            ``(1) a comprehensive management succession program to 
        provide training to employees to develop managers for the 
        agency; and
            ``(2) a program to provide training to managers on actions, 
        options, and strategies a manager may use in--
                    ``(A) relating to employees with unacceptable 
                performances; and
                    ``(B) mentoring employees and improving employee 
                performance and productivity.''.
            (2) Technical and conforming amendment.--The table of 
        sections for chapter 41 of title 5, United States Code, is 
        amended by adding at the end the following:

``4120. Agency training officer.
``4121. Specific training programs.''.
    (c) Academic Degree Training.--
            (1) In general.--Section 4107 of title 5, United States 
        Code, is amended to read as follows:
``Sec. 4107. Academic degree training
    ``(a) Subject to subsection (b), an agency may select and assign an 
employee to academic degree training and may pay or reimburse the costs 
of academic degree training from appropriated or other available funds 
if such training--
            ``(1) contributes significantly to--
                    ``(A) meeting an identified agency training need;
                    ``(B) resolving an identified agency staffing 
                problem; or
                    ``(C) accomplishing goals in the agency's strategic 
                plan;
            ``(2) is part of a planned, systematic, and coordinated 
        agency employee development program linked to accomplishing the 
        agency's strategic goals; and
            ``(3) is accredited and is provided by a college or 
        university that is accredited by a nationally recognized body.
    ``(b) In exercising authority under subsection (a), an agency 
shall--
            ``(1) consistent with the merit system principles set forth 
        in paragraphs (2) and (7) of section 2301(b), take into 
        consideration the need to--
                    ``(A) maintain a balanced workforce in which women, 
                members of racial and ethnic minority groups, and 
                persons with disabilities are appropriately represented 
                in Government service; and
                    ``(B) provide employees effective education and 
                training to improve organizational and individual 
                performance;
            ``(2) assure that the training is not for the sole purpose 
        of providing an employee an opportunity to obtain an academic 
        degree or to qualify for appointment to a particular position 
        for which the academic degree is a basic requirement; and
            ``(3) assure that no authority under this subsection is 
        exercised on behalf of any employee occupying or seeking to 
        qualify for--
                    ``(A) a noncareer appointment in the Senior 
                Executive Service; or
                    ``(B) appointment to any position that is excepted 
                from the competitive service because of its 
                confidential policy-determining, policymaking, or 
                policy-advocating character.''.
            (2) Technical and conforming amendment.--The table of 
        sections for chapter 41 of title 5, United States Code, is 
        amended by striking the item relating to section 4107 and 
        inserting the following:

``4107. Academic degree training.''.

SEC. 402. ANNUAL LEAVE ENHANCEMENTS.

    (a) Accrual of Leave for Newly Hired Federal Employees With 
Qualified Experience.--
            (1) In general.--Section 6303 of title 5, United States 
        Code, is amended by adding at the end the following:
    ``(e)(1) In this subsection, the term `period of qualified non-
Federal service' means any equal period of service performed by an 
individual that--
            ``(A) except for this subsection would not otherwise be 
        service performed by an employee for purposes of subsection 
        (a); and
            ``(B) was performed in a position--
                    ``(i) the duties of which were directly related to 
                the duties of the position in an agency that such 
                individual holds; and
                    ``(ii) which meets such other conditions as the 
                Office of Personnel Management shall prescribe by 
                regulation.
    ``(2) For purposes of subsection (a), the head of an agency may 
deem a period of qualified non-Federal service performed by an 
individual to be a period of service performed as an employee.''.
            (2) Effective date.--This section shall take effect 120 
        days after the date of enactment of this Act and shall only 
        apply to an individual hired on or after that effective date.
    (b) Senior Executive Service Annual Leave Enhancements.--
            (1) In general.--Section 6303(a) of title 5, United States 
        Code, is amended--
                    (A) in paragraph (2), by striking ``and'' at the 
                end;
                    (B) in paragraph (3), by striking the period at the 
                end and inserting ``; and''; and
                    (C) by adding after paragraph (3) the following:
            ``(4) one day for each full biweekly pay period for an 
        employee in a position paid under section 5376 or 5383, or for 
        an employee in an equivalent category for which the minimum 
        rate of basic pay is greater than the rate payable at GS-15, 
        step 10.''.
            (2) Regulations.--Not later than 120 days after the date of 
        enactment of this Act, the Office of Personnel Management shall 
        prescribe regulations to carry out the amendments made by this 
        subsection.
            (3) Effective dates.--
                    (A) In general.--Paragraph (1) shall take effect 
                120 days after the date of enactment of this Act.
                    (B) Regulations.--Paragraph (2) shall take effect 
                on the date of enactment of this Act.

SEC. 403. MODIFICATIONS TO NATIONAL SECURITY EDUCATION PROGRAM.

    (a) Findings and Policies.--
            (1) Findings.--Congress finds that--
                    (A) the United States Government actively 
                encourages and financially supports the training, 
                education, and development of many United States 
                citizens;
                    (B) as a condition of some of those supports, many 
                of those citizens have an obligation to seek either 
                compensated or uncompensated employment in the Federal 
                sector; and
                    (C) it is in the United States national interest to 
                maximize the return to the Nation of funds invested in 
                the development of such citizens by seeking to employ 
                them in the Federal sector.
            (2) Policy.--It shall be the policy of the United States 
        Government to--
                    (A) establish procedures for ensuring that United 
                States citizens who have incurred service obligations 
                as the result of receiving financial support for 
                education and training from the United States 
                Government and have applied for Federal positions are 
                considered in all recruitment and hiring initiatives of 
                Federal departments, bureaus, agencies, and offices; 
                and
                    (B) advertise and open all Federal positions to 
                United States citizens who have incurred service 
                obligations with the United States Government as the 
                result of receiving financial support for education and 
                training from the United States Government.
    (b) Fulfillment of Service Requirement if National Security 
Positions Are Unavailable.-- Section 802(b)(2) of the David L. Boren 
National Security Education Act of 1991 (50 U.S.C. 1902) is amended--
            (1) in subparagraph (A), by striking clause (ii) and 
        inserting the following:
                            ``(ii) if the recipient demonstrates to the 
                        Secretary (in accordance with such regulations) 
                        that no national security position in an agency 
                        or office of the Federal Government having 
                        national security responsibilities is 
                        available, work in other offices or agencies of 
                        the Federal Government or in the field of 
                        higher education in a discipline relating to 
                        the foreign country, foreign language, area 
                        study, or international field of study for 
                        which the scholarship was awarded, for a period 
                        specified by the Secretary, which period shall 
                        be determined in accordance with clause (i); 
                        or''; and
            (2) in subparagraph (B), by striking clause (ii) and 
        inserting the following:
                            ``(ii) if the recipient demonstrates to the 
                        Secretary (in accordance with such regulations) 
                        that no national security position is available 
                        upon the completion of the degree, work in 
                        other offices or agencies of the Federal 
                        Government or in the field of higher education 
                        in a discipline relating to the foreign 
                        country, foreign language, area study, or 
                        international field of study for which the 
                        fellowship was awarded, for a period specified 
                        by the Secretary, which period shall be 
                        established in accordance with clause (i); 
                        and''.

        TITLE V--FEDERAL HUMAN RESOURCES MANAGEMENT INNOVATIONS

SEC. 501. STREAMLINED PERSONNEL MANAGEMENT DEMONSTRATION PROJECTS.

    Chapter 47 of title 5, United States Code, is amended--
            (1) in section 4701--
                    (A) in subsection (a)--
                            (i) by striking ``(a)'';
                            (ii) by striking paragraph (1) and 
                        inserting the following:
            ``(1) `agency' means an Executive agency and any entity 
        that is subject to any provision of this title that could be 
        waived under section 4703, but does not include--
                    ``(A) the Federal Bureau of Investigation, the 
                Central Intelligence Agency, the Defense Intelligence 
                Agency, the National Imagery and Mapping Agency, the 
                National Security Agency, and, as determined by the 
                President, any Executive agency or unit thereof which 
                is designated by the President and which has as its 
                principal function the conduct of foreign intelligence 
                or counterintelligence activities; or
                    ``(B) the General Accounting Office;'';
                            (iii) in paragraph (4), by striking ``and'' 
                        at the end;
                            (iv) by redesignating paragraph (5) as 
                        paragraph (6); and
                            (v) by inserting after paragraph (4) the 
                        following:
            ``(5) `modification' means a significant change in 1 or 
        more of the elements of a demonstration project plan as 
        described in section 4703(b)(1); and''; and
                    (B) by striking subsection (b); and
            (2) in section 4703--
                    (A) in subsection (a)--
                            (i) by striking ``conduct and evaluate 
                        demonstration projects'' and inserting 
                        ``conduct, modify, and evaluate demonstration 
                        projects'';
                            (ii) by striking ``, including any law or 
                        regulation relating to--'' and all that follows 
                        and inserting a period; and
                            (iii) by adding at the end the following: 
                        ``The decision to initiate or modify a project 
under this section shall be made by the Office.'';
                    (B) by striking subsection (b) and inserting the 
                following:
    ``(b) Before conducting or entering into any agreement or contract 
to conduct a demonstration project, the Office shall ensure--
            ``(1) that each project has a plan which describes--
                    ``(A) its purpose;
                    ``(B) the employees to be covered;
                    ``(C) its anticipated outcomes and resource 
                implications, including how the project relates to 
                carrying out the agency's strategic plan, including 
                meeting performance goals and objectives, and 
                accomplishing its mission;
                    ``(D) the personnel policies and procedures the 
                project will use that differ from those otherwise 
                available and applicable, including a specific citation 
                of any provisions of law, rule, or regulation to be 
                waived and a specific description of any contemplated 
                action for which there is a lack of specific authority;
                    ``(E) the method of evaluating the project; and
                    ``(F) the agency's system for ensuring that the 
                project is implemented in a manner consistent with 
                merit system principles;
            ``(2) notification of the proposed project to employees who 
        are likely to be affected by the project;
            ``(3) an appropriate comment period;
            ``(4) publication of the final plan in the Federal 
        Register;
            ``(5) notification of the final project at least 90 days in 
        advance of the date any project proposed under this section is 
        to take effect to employees who are likely to be affected by 
        the project;
            ``(6) publication of any subsequent modification in the 
        Federal Register; and
            ``(7) notification of any subsequent modification to 
        employees who are included in the project.'';
                    (C) in subsection (c)--
                            (i) by striking paragraph (1) and inserting 
                        the following:
            ``(1) any provision of chapter 63 or subpart G of part III 
        of this title;'';
                            (ii) by redesignating paragraphs (4) and 
                        (5) as paragraphs (6) and (7), respectively;
                            (iii) by inserting after paragraph (3) the 
                        following:
            ``(4) section 7342, 7351, or 7353;
            ``(5) the Ethics in Government Act of 1978 (5 U.S.C. 
        App.);''; and
                            (iv) in paragraph (6) as redesignated, by 
                        striking ``paragraph (1), (2), or (3) of this 
                        subsection; or'' and inserting ``paragraphs (1) 
                        through (5);'';
                    (D) by striking subsections (d) and (e) and 
                inserting the following:
    ``(d)(1) Unless terminated at an earlier date in accordance with 
this section, each demonstration project shall terminate at the end of 
the 10-year period beginning on the date on which the project takes 
effect.
    ``(2) Before the end of the 5-year period beginning on the date on 
which a demonstration project takes effect, the Office shall submit a 
recommendation to Congress on whether Congress should enact legislation 
to make that project permanent.
    ``(e) The Office may terminate a demonstration project under this 
chapter if the Office determines that the project--
            ``(1) is not consistent with merit system principles set 
        forth in section 2301, veterans' preference principles, or the 
        provisions of this chapter; or
            ``(2) otherwise imposes a substantial hardship on, or is 
        not in the best interests of, the public, the Government, 
        employees, or eligibles.''; and
                    (E) by striking subsections (h) and (i) and 
                inserting the following:
    ``(h) Notwithstanding section 2302(e)(1), for purposes of applying 
section 2302(b)(11) in a demonstration project under this chapter, the 
term `veterans' preference requirement' means any of the specific 
provisions of the demonstration project plan that are designed to 
ensure that the project is consistent with veterans' preference 
principles.
    ``(i) The Office shall ensure that each demonstration project is 
evaluated. Each evaluation shall assess--
            ``(1) the project's compliance with the plan developed 
        under subsection (b)(1); and
            ``(2) the project's impact on improving public management.
    ``(j) Upon request of the Director of the Office of Personnel 
Management, agencies shall cooperate with and assist the Office in any 
evaluation undertaken under subsection (i) and provide the Office with 
requested information and reports relating to the conducting of 
demonstration projects in their respective agencies.''.

SEC. 502. EFFECTIVE DATE.

    This title shall take effect 180 days after the date of enactment 
of this Act.
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