[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[S. 380 Introduced in Senate (IS)]
108th CONGRESS
1st Session
S. 380
To amend chapter 83 of title 5, United States Code, to reform the
funding of benefits under the Civil Service Retirement System for
employees of the United States Postal Service, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
February 12, 2003
Ms. Collins (for herself, Mr. Carper, and Mr. Brownback) introduced the
following bill; which was read twice and referred to the Committee on
Governmental Affairs
_______________________________________________________________________
A BILL
To amend chapter 83 of title 5, United States Code, to reform the
funding of benefits under the Civil Service Retirement System for
employees of the United States Postal Service, 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.
This Act may be cited as the ``Postal Civil Service Retirement
System Funding Reform Act of 2003''.
SEC. 2. CIVIL SERVICE RETIREMENT SYSTEM.
(a) Definitions.--Section 8331 of title 5, United States Code, is
amended--
(1) in paragraph (17)--
(A) by striking ``normal cost'' the first place
that term appears and inserting ``normal cost
percentage''; and
(B) by inserting ``and standards (using dynamic
assumptions)'' after ``practice'';
(2) by striking paragraph (18) and inserting the following:
``(18) `Fund balance'--
``(A) means the current net assets of the Fund
available for payment of benefits, as determined by the
Office in accordance with appropriate accounting
standards; and
``(B) shall not include any amount attributable
to--
``(i) the Federal Employees' Retirement
System; or
``(ii) contributions made under the Federal
Employees' Retirement Contribution Temporary
Adjustment Act of 1983 by or on behalf of any
individual who became subject to the Federal
Employees' Retirement System;'';
(3) in paragraph (27), by striking ``and'' at the end;
(4) in paragraph (28), by striking the period and inserting
``; and''; and
(5) by adding at the end the following:
``(29) `dynamic assumptions' means economic assumptions
that are used in determining actuarial costs and liabilities of
a retirement system and in anticipating the effects of long-
term future--
``(A) investment yields;
``(B) increases in rates of basic pay; and
``(C) rates of price inflation.''.
(b) Deductions, Contributions, and Deposits.--Section 8334 of title
5, United States Code, is amended by striking the matter following the
section heading through paragraph (1) and inserting the following:
``(a)(1)(A) The employing agency shall deduct and withhold from the
basic pay of an employee, Member, congressional employee, law
enforcement officer, firefighter, bankruptcy judge, judge of the United
States Court of Appeals for the Armed Forces, United States magistrate
judge, Court of Federal Claims judge, member of the Capitol Police,
member of the Supreme Court Police, or nuclear materials courier, as
the case may be, the percentage of basic pay applicable under
subsection (c).
``(B)(i) Except in the case of an employee of the United States
Postal Service, an equal amount shall be contributed from the
appropriation or fund used to pay the employee or, in the case of an
elected official, from an appropriation or fund available for payment
of other salaries of the same office or establishment. When an employee
in the legislative branch is paid by the Chief Administrative Officer
of the House of Representatives, the Chief Administrative Officer may
pay from the applicable accounts of the House of Representatives the
contribution that otherwise would be contributed from the appropriation
or fund used to pay the employee.
``(ii) In the case of an employee of the United States Postal
Service, an amount shall be contributed from the appropriation or fund
used to pay the employee equal to the difference between--
``(I) the product of--
``(aa) the basic pay of that employee; and
``(bb) the normal cost percentage applicable to the
employee category of that employee under paragraph
(1)(A); and
``(II) the product of--
``(aa) the basic pay of that employee; and
``(bb) the percentage applicable to that employee
under subsection (c) deducted from basic pay under
paragraph (1)(A).''.
(c) Civil Service Retirement and Disability Fund.--
(1) In general.--Section 8348 of title 5, United States
Code, is amended by striking subsection (h) and inserting the
following:
``(h)(1)(A) In this subsection, the term `Postal supplemental
liability' means the estimated excess, as determined by the Office of
Personnel Management, of the difference between--
``(i) the actuarial present value of all future benefits
payable from the Fund under this subchapter attributable to the
service of current or former employees of the United States
Postal Service; and
``(ii) the sum of--
``(I) the actuarial present value of deductions to
be withheld from the future basic pay of employees of
the United States Postal Service currently subject to
this subchapter under section 8334;
``(II) the actuarial present value of the future
contributions to be made under section 8334 with
respect to employees of the United States Postal
Service currently subject to this subchapter;
``(III) that portion of the Fund balance, as of the
date the Postal supplemental liability is determined,
attributable to payments to the Fund by the United
States Postal Service and employees of the United
States Postal Service, including earnings on those
payments; and
``(IV) any other appropriate amount, as determined
by the Office in accordance with generally accepted
actuarial practices and principles.
``(B)(i) In computing the actuarial present value of future
benefits, the Office shall include the full value of benefits
attributable to military and volunteer service for United States Postal
Service employees first employed after June 30, 1971, and a prorated
share of the value of benefits attributable to military and volunteer
service for United States Postal Service employees first employed
before July 1, 1971.
``(ii) Military service included in the computation under clause
(i) shall not be included in computation of the payment required under
subsection (g)(2).
``(2)(A) Not later than June 30, 2004, the Office of Personnel
Management shall determine the Postal supplemental liability, as of
September 30, 2003. The Office shall establish an amortization
schedule, including a series of equal annual installments commencing
September 30, 2004, which provides for the liquidation of such
liability by September 30, 2043.
``(B) The Office shall redetermine the Postal supplemental
liability as of the close of the fiscal year, for each fiscal year
beginning after September 30, 2003, through the fiscal year ending
September 30, 2038, and shall establish a new amortization schedule,
including a series of equal annual installments commencing on September
30 of the subsequent fiscal year, which provides for the liquidation of
such liability by September 30, 2043.
``(C) The Office shall redetermine the Postal supplemental
liability as of the close of the fiscal year for each fiscal year
beginning after September 30, 2038, and shall establish a new
amortization schedule, including a series of equal annual installments
commencing on September 30 of the subsequent fiscal year, which
provides for the liquidation of such liability over 5 years.
``(D) Amortization schedules established under this paragraph shall
be set in accordance with generally accepted actuarial practices and
principles, with interest computed at the rate used in the most recent
valuation of the Civil Service Retirement System.
``(E) The United States Postal Service shall pay the amounts
determined under this paragraph for deposit in the Fund, with payments
due not later than the date scheduled by the Office.
``(3) Notwithstanding any other provision of law, in computing the
amount of any payment under any provision other than this subsection
that is based upon the amount of the unfunded liability, such payment
shall be computed disregarding that portion of the unfunded liability
that the Office determines will be liquidated by payments under this
subsection.''.
(2) Technical and conforming amendment.--Section 8334 of
title 5, United States Code, is amended by striking subsection
(m).
(d) Other Payments.--
(1) In general.--Section 7101(c) of the Omnibus Budget
Reconciliation Act of 1990 (5 U.S.C. 8348 note; Public Law 101-
508; 104 Stat. 1388-331) is repealed.
(2) Effect on prior payments.--The repeal under paragraph
(1) shall have no effect on payments made under the repealed
provisions before the date of enactment of this Act.
SEC. 3. DISPOSITION OF SAVINGS ACCRUING TO THE UNITED STATES POSTAL
SERVICE.
(a) In General.--Savings accruing to the United States Postal
Service as a result of the enactment of this Act shall be used to
reduce the postal debt to such extent and in such manner as the
Secretary of the Treasury shall specify, consistent with succeeding
provisions of this section.
(b) Amounts Saved.--
(1) In general.--The amounts representing any savings
accruing to the Postal Service in any fiscal year as a result
of the enactment of this Act shall be computed by the Office of
Personnel Management in accordance with paragraph (2).
(2) Methodology.--Not later than July 31, 2003, for fiscal
year 2003, and October 1 of the fiscal year before each fiscal
year beginning after September 30, 2003, and before the date
specified in paragraph (4), the Office of Personnel Management
shall--
(A) formulate a plan specifically enumerating the
methods by which the Office shall make its computations
under paragraph (1); and
(B) submit such plan to the Committee on Government
Reform of the House of Representatives and the
Committee on Governmental Affairs of the Senate.
(3) Requirements.--Each such plan shall be formulated in
consultation with the Postal Service and shall include the
opportunity for the Postal Service to request reconsideration
of computations under this subsection, and for the Board of
Actuaries of the Civil Service Retirement System to review and
make adjustments to such computations, to the same extent and
in the same manner as provided under section 8423(c) of title
5, United States Code.
(4) Duration.--Nothing in this subsection or subsection (a)
shall be considered to apply with respect to any fiscal year
beginning on or after October 1, 2007.
(c) Reporting Requirement.--The Postal Service shall include in
each report which is rendered under section 2402 of title 39, United
States Code, and which relates to any period after the date of the
enactment of this Act and before the date specified in subsection
(b)(4), the amount applied toward reducing the postal debt, and the
size of the postal debt before and after the application of subsection
(a), during the period covered by such report.
(d) Postal Debt Defined.--For purposes of this section, the term
``postal debt'' means the outstanding obligations of the Postal
Service, as determined under chapter 20 of title 39, United States
Code.
(e) Sense of Congress.--It is the sense of the Congress that--
(1) the savings accruing to the Postal Service as a result
of the enactment of this Act will be sufficient to allow the
Postal Service to fulfill its commitment to hold postage rates
unchanged until at least 2006;
(2) because the Postal Service still faces substantial
obligations related to postretirement health benefits for its
current and former employees, some portion of the savings
referred to in paragraph (1) should be used to address those
unfunded obligations; and
(3) none of the savings referred to in paragraph (1) should
be used to pay bonuses to Postal Service executives.
(f) Report Relating to Unfunded Healthcare Costs.--
(1) In general.--The United States Postal Service shall, by
December 31, 2003, in consultation with the General Accounting
Office, prepare and submit to the President and the Congress a
report describing how the Postal Service proposes to address
its obligations relating to unfunded postretirement healthcare
costs of current and former postal employees.
(2) President's commission.--In preparing its report under
this subsection, the Postal Service should consider the report
of the President's Commission on the United States Postal
Service under section 5 of Executive Order 13278 (67 Fed. Reg.
76672).
(3) GAO review and report.--Not later than 30 days after
the Postal Service submits its report pursuant to paragraph
(1), the General Accounting Office shall prepare and submit a
written evaluation of such report to the Committee on
Government Reform of the House of Representatives and the
Committee on Governmental Affairs of the Senate.
(g) Determination and Disposition of Surplus.--
(1) In general.--If, as of the date under paragraph (2),
the Office of Personnel Management determines (after
consultation with the Postmaster General) that the computation
under section 8348(h)(1)(A) of title 5, United States Code,
yields a negative amount (hereinafter referred to as a
``surplus'')--
(A) the Office shall inform the Postmaster General
of its determination, including the size of the surplus
so determined; and
(B) the Postmaster General shall submit to the
Congress a report describing how the Postal Service
proposes that such surplus be used, including a draft
of any legislation that might be necessary.
(2) Determination date.--The date to be used for purposes
of paragraph (1) shall be September 30, 2025, or such earlier
date as, in the judgment of the Office, is the date by which
all postal employees under the Civil Service Retirement System
will have retired.
SEC. 4. EFFECTIVE DATE.
(a) In General.--This Act shall take effect on the date of
enactment of this Act.
(b) Application.--Section 8334(a)(1)(B)(ii) of title 5, United
States Code (as added by section 2(b) of this Act), shall apply only
with respect to pay periods beginning on or after the date of enactment
of this Act.
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