[Congressional Record Volume 144, Number 97 (Monday, July 20, 1998)]
[House]
[Pages H5901-H5911]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                              {time}  1700
              FEDERAL RETIREMENT COVERAGE CORRECTIONS ACT

  Mr. MICA. Mr. Speaker, I move to suspend the rules and pass the bill 
(H.R. 3249) to provide for the rectification of certain retirement 
coverage errors affecting Federal employees, and for other purposes, as 
amended.
  The Clerk read as follows:

                               H.R. 3249

       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 
     Retirement Coverage Corrections Act''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Definitions.
Sec. 3. Applicability.
Sec. 4. Restriction relating to future corrections.
Sec. 5. Irrevocability of elections.

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

  Subtitle A--Employee Who Should Have Been FERS Covered, But Who Was 
        Erroneously CSRS Covered or CSRS-Offset Covered Instead

Sec. 101. Elections.
Sec. 102. Effect of an election to be transferred from CSRS to FERS to 
              correct a retirement coverage error.
Sec. 103. Effect of an election to be transferred from CSRS-Offset to 
              FERS to correct a retirement coverage error.
Sec. 104. Effect of an election to be transferred from CSRS to CSRS-
              Offset to correct a retirement coverage error.
Sec. 105. Effect of an election to be restored (or transferred) to 
              CSRS-Offset after having been corrected to FERS from 
              CSRS-Offset (or CSRS).
Sec. 106. Effect of election to remain FERS covered after having been 
              corrected to FERS from CSRS-Offset (or CSRS).

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

Sec. 111. Elections.
Sec. 112. Effect of an election to become FERS covered to correct the 
              retirement coverage error.
Sec. 113. Effect of an election to become CSRS-Offset covered to 
              correct the retirement coverage error.
Sec. 114. Effect of an election to become CSRS covered to correct the 
              retirement coverage error.

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

Sec. 121. Uncorrected error: employee who should be Social Security-
              Only covered, but who is erroneously FERS covered 
              instead.
Sec. 122. Uncorrected error: employee who should be Social Security-
              Only covered, but who is erroneously CSRS-Offset covered 
              instead.
Sec. 123. Uncorrected error: employee who should be Social Security-
              Only covered, but who is erroneously CSRS covered 
              instead.
Sec. 124. Corrected error: situations under sections 121-123.
Sec. 125. Vested employees excepted from automatic exclusion.

 Subtitle D--Employee Who Should Have Been CSRS Covered or CSRS-Offset 
         Covered, But Who Was Erroneously FERS Covered Instead

Sec. 131. Elections.
Sec. 132. Effect of an election to be transferred from FERS to CSRS to 
              correct a retirement coverage error.
Sec. 133. Effect of an election to be transferred from FERS to CSRS-
              Offset to correct a retirement coverage error.
Sec. 134. Effect of an election to be restored to FERS after having 
              been corrected to CSRS.
Sec. 135. Effect of an election to be restored to FERS after having 
              been corrected to CSRS-Offset.
Sec. 136. Disqualification of certain individuals to whom same election 
              was previously available.

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

Sec. 141. Automatic transfer to CSRS-Offset.
Sec. 142. Effect of transfer.

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

Sec. 151. Elections.
Sec. 152. Effect of an election to be transferred from CSRS-Offset to 
              CSRS to correct the retirement coverage error.
Sec. 153. Effect of an election to be restored to CSRS-Offset after 
              having been corrected to CSRS.

   Subtitle G--Additional Provisions Relating to Government Agencies

Sec. 161. Repayment required in certain situations.
Sec. 162. Equitable sharing of amounts payable from the Government if 
              more than one agency involved.
Sec. 163. Provisions relating to the original responsible agency.

                      TITLE II--GENERAL PROVISIONS

Sec. 201. Identification and notification requirements.
Sec. 202. Individual appeal rights.
Sec. 203. Information to be furnished by Government agencies to 
              authorities administering this Act.
Sec. 204. Social Security records.
Sec. 205. Conforming amendments respecting Social Security coverage and 
              OASDI taxes.
Sec. 206. Regulations.
Sec. 207. All elections to be approved by OPM.
Sec. 208. Additional transfers to OASDI trust funds in certain cases.
Sec. 209. Technical and conforming amendments.

                      TITLE III--OTHER PROVISIONS

Sec. 301. Provisions to permit continued conformity of other Federal 
              retirement systems.
Sec. 302. Provisions to prevent reductions in force and any unfunded 
              liability in the CSRDF.
Sec. 303. Individual right of action preserved for amounts not 
              otherwise provided for under this Act.

[[Page H5902]]

Sec. 304. Extension of open enrollment period to employees under the 
              Foreign Service Retirement and Disability System.

                        TITLE IV--TAX PROVISIONS

Sec. 401. Tax provisions.

     SEC. 2. DEFINITIONS.

       For purposes of this Act:
       (1) CSRS.--The term ``CSRS'' means the Civil Service 
     Retirement System.
       (2) CSRDF.--The term ``CSRDF'' means the Civil Service 
     Retirement and Disability Fund.
       (3) CSRS covered.--The term ``CSRS covered'', with respect 
     to any service, means service that is subject to the 
     provisions of subchapter III of chapter 83 of title 5, United 
     States Code, other than those that apply only with respect to 
     an individual described in section 8402(b)(2) of such title.
       (4) CSRS-offset covered.--The term ``CSRS-Offset covered'', 
     with respect to any service, means service that is subject to 
     the provisions of subchapter III of chapter 83 of title 5, 
     United States Code, that apply with respect to an individual 
     described in section 8402(b)(2) of such title.
       (5) Employee.--The term ``employee'' means an employee as 
     defined by section 8331 or 8401 of title 5, United States 
     Code, and any other individual (not satisfying either of 
     those definitions) serving in an appointive or elective 
     office or position in the executive, legislative, or judicial 
     branch of the Government who, by virtue of that service, is 
     permitted or required to be CSRS covered, CSRS-Offset 
     covered, FERS covered, or Social Security-Only covered.
       (6) Executive director.--The term ``Executive Director of 
     the Federal Retirement Thrift Investment Board'' or 
     ``Executive Director'' means the Executive Director appointed 
     under section 8474 of title 5, United States Code.
       (7) FERS.--The term ``FERS'' means the Federal Employees' 
     Retirement System.
       (8) FERS covered.--The term ``FERS covered'', with respect 
     to any service, means service that is subject to chapter 84 
     of title 5, United States Code.
       (9) Government.--The term ``Government'' has the meaning 
     given such term by section 8331(7) of title 5, United States 
     Code.
       (10) OASDI taxes.--The term ``OASDI taxes'' means the OASDI 
     employee tax and the OASDI employer tax.
       (11) OASDI employee tax.--The term ``OASDI employee tax'' 
     means the tax imposed under section 3101(a) of the Internal 
     Revenue Code of 1986 (relating to Old-Age, Survivors and 
     Disability Insurance).
       (12) OASDI employer tax.--The term ``OASDI employer tax'' 
     means the tax imposed under section 3111(a) of the Internal 
     Revenue Code of 1986 (relating to Old-Age, Survivors and 
     Disability Insurance).
       (13) OASDI trust funds.--The term ``OASDI trust funds'' 
     means the Federal Old-Age and Survivors Insurance Trust Fund 
     and the Federal Disability Insurance Trust Fund.
       (14) Period of erroneous coverage.--The term ``period of 
     erroneous coverage'' means, in the case of a retirement 
     coverage error, the period throughout which retirement 
     coverage is in effect pursuant to such error (or would have 
     been in effect, but for such error).
       (15) Retirement coverage determination.--The term 
     ``retirement coverage determination'' means a determination 
     by an employee or agent of the Government as to whether a 
     particular type of Government service is CSRS covered, CSRS-
     Offset covered, FERS covered, or Social Security-Only 
     covered.
       (16) Retirement coverage error.--The term ``retirement 
     coverage error'' means a retirement coverage determination 
     that, as a result of any error, misrepresentation, or 
     inaction on the part of an employee or agent of the 
     Government (including an error as described in section 
     163(b)(2)), causes an individual erroneously to be enrolled 
     or not enrolled in a retirement system, as further described 
     in the applicable subtitle of title I.
       (17) Social security-only covered.--The term ``Social 
     Security-Only covered'', with respect to any service, means 
     Government service that constitutes employment under section 
     210 of the Social Security Act (42 U.S.C. 410), and that--
       (A) is subject to OASDI taxes; but
       (B) is not subject to any retirement system for Government 
     employees (disregarding title II of the Social Security Act).
       (18) Thrift savings fund.--The term ``Thrift Savings Fund'' 
     means the Thrift Savings Fund established under section 8437 
     of title 5, United States Code.

     SEC. 3. APPLICABILITY.

       (a) In General.--Subject to subsection (b), this Act shall 
     apply with respect to any retirement coverage error that 
     occurs before, on, or after the date of enactment of this 
     Act, excluding any error corrected within 1 year after the 
     date on which it occurs.
       (b) Limitation.--Nothing in this Act shall affect any 
     retirement coverage or treatment accorded with respect to any 
     individual in connection with any period beginning before the 
     first day of the first applicable pay period beginning on or 
     after January 1, 1984.

     SEC. 4. RESTRICTION RELATING TO FUTURE CORRECTIONS.

       (a) In General.--Except as otherwise provided in this Act, 
     any individual who, on or after the date of enactment of this 
     Act, becomes or remains affected by a retirement coverage 
     error may not be excluded from or made subject to any 
     retirement system for the sole purpose of correcting such 
     error.
       (b) Coordination With Other Laws.--
       (1) In general.--Nothing in this Act shall be considered to 
     preclude an election under the Federal Employees' Retirement 
     System Open Enrollment Act of 1997 (Public Law 105-61; 111 
     Stat. 1318) or any other voluntary retirement coverage 
     election authorized by statute.
       (2) Regulations.--The Office of Personnel Management shall 
     prescribe any regulations which may be necessary to apply 
     this Act in the case of any individual who changes retirement 
     coverage pursuant to a voluntary election made other than 
     under this Act.

     SEC. 5. IRREVOCABILITY OF ELECTIONS.

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

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

  Subtitle A--Employee Who Should Have Been FERS Covered, But Who Was 
        Erroneously CSRS Covered or CSRS-Offset Covered Instead

     SEC. 101. ELECTIONS.

       (a) Applicability.--This subtitle shall apply in the case 
     of any employee who--
       (1) should be (or should have been) FERS covered but, as a 
     result of a retirement coverage error, is (or was) CSRS 
     covered instead; or
       (2) should be (or should have been) FERS covered but, as a 
     result of a retirement coverage error, is (or was) CSRS-
     Offset covered instead.
       (b) Uncorrected Error.--If, at the time of making an 
     election under this section, the retirement coverage error 
     described in paragraph (1) or (2) of subsection (a) (as 
     applicable) has not been corrected, the employee affected by 
     such error may elect--
       (1) to be FERS covered instead; or
       (2) to remain (or instead become) CSRS-Offset covered.
       (c) Corrected Error.--If, at the time of making an election 
     under this section, the retirement coverage error described 
     in paragraph (1) or (2) of subsection (a) (as applicable) has 
     been corrected, the employee affected by such error may 
     elect--
       (1) to be CSRS-Offset covered instead; or
       (2) to remain FERS covered.
       (d) Default Rule.--
       (1) In general.--If the employee is given written notice in 
     accordance with section 201 as to the availability of an 
     election under this section, but does not make any such 
     election within the 6-month period beginning on the date on 
     which such notice is so given, the option under subsection 
     (b)(2) or (c)(2), as applicable, shall be deemed to have been 
     elected on the last day of such period.
       (2) CSRS not an option.--Nothing in this section shall be 
     considered to afford an employee the option of becoming or 
     remaining CSRS covered.
       (e) Retroactive Effect.--An election under this section 
     (including an election by default, and an election to remain 
     covered by the retirement system by which the electing 
     individual is covered as of the date of the election) shall 
     be effective retroactive to the effective date of the 
     retirement coverage error (as referred to in subsection (a)) 
     to which such election relates.

     SEC. 102. EFFECT OF AN ELECTION TO BE TRANSFERRED FROM CSRS 
                   TO FERS TO CORRECT A RETIREMENT COVERAGE ERROR.

       (a) Applicability.--This section shall apply in the case of 
     any employee affected by an error described in section 
     101(a)(1) who elects the option under section 101(b)(1).
       (b) Disposition of Contributions to the CSRDF.--
       (1) Employee contributions.--
       (A) Transfer to oasdi trust funds.--There shall be 
     transferred from the CSRDF to the OASDI trust funds an amount 
     equal to the amount of the OASDI employee tax that should 
     have been deducted and withheld from the Federal wages of the 
     employee for the period of erroneous coverage involved.
       (B) Rule if there are excess csrdf contributions.--
       (i) In general.--Any excess amount described in clause (ii) 
     that is attributable to an employee described in subsection 
     (a) shall be forfeited.
       (ii) Excess amount defined.--The excess amount described in 
     this clause is, in the case of an employee, the amount by 
     which--

       (I) that portion of the employee's lump-sum credit that is 
     attributable to the period of erroneous coverage involved, 
     exceeds (if at all)
       (II) the total of the amount described in subparagraph (A) 
     plus the amount that should have been deducted under section 
     8422 of title 5, United States Code, from the pay of the 
     employee for the period of erroneous coverage involved.

       (C) Rule if lump-sum credit is less than total employee 
     contributions to oasdi and csrdf that should have been 
     made.--
       (i) In general.--

       (I) Shortfall to be made up by agency.--If the amount 
     described in subparagraph (B)(ii)(I) is less than the total 
     amount described in subparagraph (B)(ii)(II), an amount equal 
     to the shortfall shall be made up (in such manner as the 
     Commissioner of Social Security shall prescribe) by the 
     agency in or under which the employee is then employed, out 
     of amounts otherwise available in the appropriation, fund, or 
     account from which any OASDI employer tax or contribution to 
     the CSRDF (as applicable) may be made, except as provided in 
     subclause (II) or clause (iii)(I).

[[Page H5903]]

       (II) Reduction for deposit due.--In any case in which a 
     deposit is required under clause (ii), the amount required to 
     be made up under subclause (I) shall be reduced by the amount 
     of the deposit so required (but not below zero).

       (ii) Deposit requirement.--

       (I) In general.--To the extent that the shortfall under 
     clause (i) is due to the any lump-sum credit received by the 
     employee (for which an appropriate deposit under section 
     8334(d)(1) of title 5, United States Code, has not been 
     made), the employee shall be required to repay an amount 
     equal to the amount of such deposit, except as provided in 
     clause (iii)(I).
       (II) Treatment as a debt due.--If an employee fails to pay 
     the amount required under subclause (I), that amount shall be 
     recoverable by the CSRDF under the same authorities 
     (including to waive a right of recovery) as described in 
     section 114(b)(2). For purposes of any exercise of authority 
     under the preceding sentence, the Director of the Office of 
     Personnel Management shall be considered the head of the 
     agency concerned.

       (iii) Special rules.--

       (I) Deposit for fers deductions not mandatory.--Nothing in 
     this subparagraph shall, in any situation described in clause 
     (ii), be considered to require any agency make-up payment (or 
     employee repayment) of any portion of the lump-sum credit 
     (beyond any amount necessary in order to permit the transfer 
     described in paragraph (1)(A)) which would be assignable to 
     amounts that should have been deducted under section 8422 of 
     title 5, United States Code, from pay of the employee 
     involved.
       (II) Authority to make fers deposit.--An employee under 
     this section who has received a lump-sum credit (described in 
     clause (ii)(I)) may not be credited, under chapter 84 of 
     title 5, United States Code, with any period of service to 
     which that lump-sum credit relates unless the employee 
     deposits into the CSRDF an amount equal to the percentage of 
     such employee's basic pay (for such period of service) that 
     should have been deducted under section 8422 of such title 5.

       (D) Definition of lump-sum credit.--For purposes of this 
     paragraph, the term ``lump-sum credit'' has the meaning given 
     such term by section 8331 of title 5, United States Code, 
     except as the context may otherwise indicate.
       (E) Provisions relating to the application of this 
     paragraph in other situations.--
       (i) General authority.--To the extent necessary to permit 
     the operation of this paragraph in any situation covered by 
     any other provisions of this Act (which incorporate this 
     paragraph by reference), any necessary technical and 
     conforming amendments to this paragraph not otherwise 
     specifically provided for (such as citations to appropriate 
     provisions of law corresponding to provisions cited in this 
     paragraph) shall be made under regulations which the Office 
     of Personnel Management shall prescribe.
       (ii) Special rule.--

       (I) Deposits not precluded by fers restriction.--Nothing in 
     section 8424(a) of title 5, United States Code, shall, in any 
     situation covered by this Act, prevent the making of any 
     deposit (and crediting, for retirement purposes, of service 
     for the corresponding period of time) to the extent that the 
     deposit relates to the period of erroneous coverage involved.
       (II) Exception.--The preceding sentence shall not apply in 
     any situation in which the employee involved was erroneously 
     FERS covered, and remained FERS covered after the 
     rectification provided for under this Act.

       (2) Government contributions.--
       (A) Transfer to oasdi trust funds.--There shall be 
     transferred from the CSRDF to the OASDI trust funds the 
     excess of--
       (i) the amount of the OASDI employer tax that should have 
     been paid with respect to the employee for the period of 
     erroneous coverage involved, over
       (ii) the amount of the OASDI employer tax that may be 
     assessed under section 6501 of the Internal Revenue Code of 
     1986 in connection with such employee,

     determined in such manner as the Secretary of the Treasury 
     shall by regulation prescribe.
       (B) Rule if csrdf contributions actually made are less than 
     total government contributions to oasdi and csrdf that should 
     have been made.--
       (i) In general.--If the total Government contributions to 
     the CSRDF that were made with respect to the employee for the 
     period of erroneous coverage involved are less than the 
     amount described in clause (ii), an amount equal to the 
     shortfall shall be made up (in such manner as the 
     Commissioner of Social Security shall prescribe) by the 
     agency in or under which the employee is then employed.
       (ii) Description of amount.--The amount described in this 
     clause is the total of--

       (I) the amount required to be transferred under 
     subparagraph (A), plus
       (II) the amount that should have been contributed by the 
     Government under section 8423 of title 5, United States Code, 
     for such employee with respect to such period.

       (iii) Source of payments.--Any amount required to be paid 
     by an agency under clause (i) shall be payable out of any 
     appropriation, fund, or account available to such agency for 
     making Government contributions to the CSRDF or the OASDI 
     trust funds (as appropriate).
       (c) Makeup Contributions to the Thrift Savings Fund.--
       (1) In general.--An employee to whom this section applies 
     is entitled to have contributed to the Thrift Savings Fund on 
     such employee's behalf, in addition to any regular employee 
     or Government contributions that would be permitted or 
     required for the year in which the contributions under this 
     subsection are made, an amount equal to the sum of--
       (A) the amount determined under paragraph (2) with respect 
     to such employee for the period of erroneous coverage 
     involved;
       (B) an amount equal to the total contributions that should 
     have been made for such employee under section 8432(c)(1) of 
     title 5, United States Code, for the period of erroneous 
     coverage involved;
       (C) an amount equal to the total contributions that should 
     have been made for such employee under section 8432(c)(2) of 
     title 5, United States Code, for the period of erroneous 
     coverage involved (taking into account both the amount 
     referred to in subparagraph (A) and any contributions to the 
     Thrift Savings Fund actually made by such employee with 
     respect to the period involved); and
       (D) an amount equal to lost earnings on the amounts 
     referred to in subparagraphs (A) through (C), determined in 
     accordance with paragraph (3).
       (2) Amount based on average percentage of pay contributed 
     by employees during period of erroneous coverage.--
       (A) In general.--The amount determined under this paragraph 
     with respect to an employee for a period of erroneous 
     coverage shall be equal to the amount of the contributions 
     such employee would have made if, during each calendar year 
     in such period, the employee had contributed the percentage 
     of such employee's basic pay for such year specified in 
     subparagraph (B) (determined disregarding any contributions 
     actually made by such employee with respect to the year 
     involved).
       (B) Percentage to be applied.--
       (i) In general.--The percentage to be applied under this 
     subparagraph in the case of any employee with respect to a 
     particular year is--

       (I) the average percentage of basic pay that was 
     contributed for such year under section 8432(a) of title 5, 
     United States Code, by full-time FERS covered employees who 
     contributed to the Thrift Savings Fund in such year and for 
     whom a salary rate is recorded (as of June 30 of such year) 
     in the central personnel data file maintained by the Office 
     of Personnel Management; or
       (II) if such average percentage for the year in question is 
     unavailable, the average percentage for the most recent year 
     prior to the year in question that is available.

       (ii) Percentage contributed.--For purposes of clause 
     (i)(I), the percentage of basic pay for each employee 
     included in the average shall be determined by dividing the 
     total employee contributions received into the Thrift Savings 
     Plan account of that employee during such year by the annual 
     salary rate for that employee as recorded in the central 
     personnel data file (referred to in clause (i)(I)) as of June 
     30 of such year.
       (C) Limitations.--In no event may the amount determined 
     under this paragraph for an individual with respect to a year 
     exceed the amount that, if added to the amount of the 
     contributions that were actually made by such individual to 
     the Thrift Savings Fund with respect to such year (if any), 
     would cause the total to exceed--
       (i) any limitation under section 415 or any other provision 
     of the Internal Revenue Code of 1986 that would have applied 
     to such employee with respect to such year; or
       (ii) any limitation under section 8432(a) or any other 
     provision of title 5, United States Code, that would have 
     applied to such employee with respect to such year.
       (3) Lost earnings.--
       (A) In general.--Lost earnings on any amounts referred to 
     in subparagraph (A), (B), or (C) of paragraph (1) shall, to 
     the extent those amounts are attributable to contributions 
     that should have been made with respect to a particular year, 
     be determined in the same way as if those amounts had in fact 
     been timely contributed and allocated among the TSP 
     investment funds in accordance with--
       (i) the investment fund election that was accepted by the 
     employing agency before the date the contribution should have 
     been made and that was still in effect as of that date; or
       (ii) if no such election was then in effect for the 
     employee, the investment fund election attributed to such 
     employee with respect to such year.
       (B) Investment fund election attributed.--For purposes of 
     subparagraph (A)(ii), the investment fund election attributed 
     to an employee with respect to a particular year is--
       (i) the average percentage allocation of TSP contributions 
     among the TSP investment funds from all sources, with respect 
     to that year, except that the investment fund election 
     attributed to contributions in years prior to 1991 shall be 
     the G Fund; or
       (ii) if such average percentage allocation for the year in 
     question is unavailable, the average percentage allocation 
     for the most recent year prior to the year in question that 
     is available.
       (C) Definition of investment fund election, etc.--For 
     purposes of this paragraph--
       (i) the term ``investment fund election'' means a choice by 
     a participant concerning how contributions to the Thrift 
     Savings Plan

[[Page H5904]]

     shall be allocated among the TSP investment funds;
       (ii) the term ``participant'' means any person with an 
     account in the Thrift Savings Plan, or who would have an 
     account in the Thrift Savings Plan but for an employing 
     agency error (including an error as described in section 
     163(b)(2));
       (iii) the term ``TSP investment funds'' means the C Fund, 
     the F Fund, the G Fund, and any other investment fund in the 
     Thrift Savings Plan created after December 27, 1996; and
       (iv) the terms ``C Fund'', ``F Fund'', and ``G Fund'' refer 
     to the funds described in paragraphs (1), (3), and (4), 
     respectively, of section 8438(a) of title 5, United States 
     Code.
       (4) Makeup contribution to be made in a lump sum.--
       (A) In general.--Any amount to which an employee is 
     entitled under this subsection shall be paid promptly by the 
     agency in or under which the electing employee is (as of the 
     date of the election) employed, in a lump sum, upon 
     notification to such agency under subparagraph (B)(ii) as to 
     the amount due.
       (B) Board functions.--The regulations under paragraph (6) 
     shall include provisions under which--
       (i) each employing agency shall be required to determine 
     and notify the Federal Retirement Thrift Investment Board, in 
     a timely manner, as to any amounts under paragraph (1)(A)-(C) 
     owed by such agency; and
       (ii) the Board shall, based on the information it receives 
     from an agency under clause (i), determine lost earnings on 
     those amounts and promptly notify such agency as to the total 
     amounts due from it under this subsection.
       (5) Justices and judges; magistrates; etc.--The preceding 
     provisions of this subsection shall not apply in the case of 
     any employee who, pursuant to the election referred to in 
     subsection (a), becomes subject to section 8440a, 8440b, 
     8440c, or 8440d of title 5, United States Code.
       (6) Regulations.--The Executive Director of the Federal 
     Retirement Thrift Investment Board shall prescribe any 
     regulations necessary to carry out this subsection.

     SEC. 103. EFFECT OF AN ELECTION TO BE TRANSFERRED FROM CSRS-
                   OFFSET TO FERS TO CORRECT A RETIREMENT COVERAGE 
                   ERROR.

       (a) Applicability.--This section shall apply in the case of 
     any employee affected by an error described in section 
     101(a)(2) who elects the option under section 101(b)(1).
       (b) Effect of Election.--In the case of an employee 
     described in subsection (a), the following provisions shall 
     apply:
       (1) Section 102(b) (relating to disposition of 
     contributions to the CSRDF), but disregarding provisions 
     relating to transfers to OASDI trust funds.
       (2) Section 102(c) (relating to makeup contributions to the 
     Thrift Savings Fund).

     SEC. 104. EFFECT OF AN ELECTION TO BE TRANSFERRED FROM CSRS 
                   TO CSRS-OFFSET TO CORRECT A RETIREMENT COVERAGE 
                   ERROR.

       (a) Applicability.--This section shall apply in the case of 
     any employee affected by an error described in section 
     101(a)(1) who elects the option under section 101(b)(2).
       (b) Same as in the Case of an Election to Ratify Erroneous 
     CSRS-Offset Coverage.--
       (1) In general.--The effect of an election described in 
     subsection (a) shall be as described in section 101(b)(2), 
     except that the provisions of section 102(b) shall also 
     apply.
       (2) Appropriate percentages to be used in determining 
     employee and government contributions to csrdf.--For purposes 
     of paragraph (1), section 102(b) shall be applied by 
     substituting ``the relevant provisions of section 8334(k)'' 
     for ``section 8422'' and ``section 8423''.

     SEC. 105. EFFECT OF AN ELECTION TO BE RESTORED (OR 
                   TRANSFERRED) TO CSRS-OFFSET AFTER HAVING BEEN 
                   CORRECTED TO FERS FROM CSRS-OFFSET (OR CSRS).

       (a) Applicability.--This section shall apply in the case of 
     any employee affected by an error described in paragraph (1) 
     or (2) of section 101(a) who (after having been corrected to 
     FERS coverage) elects the option under section 101(c)(1).
       (b) Disposition of Contributions to the CSRDF.--
       (1) In general.--The provisions of section 102(b) shall 
     apply in the case of an employee described in subsection (a), 
     subject to paragraph (2).
       (2) No transfers for amounts already paid into oasdi, 
     etc.--For purposes of paragraph (1), section 102(b) shall be 
     applied in conformance with the following:
       (A) No double payments into oasdi.--To the extent that the 
     appropriate OASDI employee or employer tax has already been 
     paid for the total period involved (or any portion thereof), 
     reduce the respective amounts required by paragraphs (1)(A) 
     and (2)(A)(i) of section 102(b) accordingly.
       (B) Appropriate percentages to be used in determining 
     employee and government contributions to csrdf.--Substitute 
     ``the relevant provisions of section 8334(k)'' for ``section 
     8422'' and ``section 8423''.
       (C) Appropriate lump-sum credit to be used.--The 
     appropriate lump-sum credit to be used under this subsection 
     shall be determined in accordance with regulations to be 
     prescribed by the Office of Personnel Management.
       (D) Provisions to be applied with respect to the total 
     period involved.--Substitute ``total period involved (as 
     defined by section 105)'' for ``period of erroneous coverage 
     involved''.
       (c) Disposition of Excess TSP Contributions.--
       (1) Government contributions.--All Government contributions 
     made on behalf of the employee to the Thrift Savings Fund 
     that are attributable to the total period involved (including 
     any earnings thereon) shall be forfeited. For the purpose of 
     section 8437(d) of title 5, United States Code, amounts so 
     forfeited shall be treated as if they were amounts forfeited 
     under section 8432(g) of such title.
       (2) Employee contributions.--The election referred to in 
     subsection (a) shall not be taken into account for purposes 
     of any determination relating to the disposition of any 
     employee contributions to the Thrift Savings Fund, 
     attributable to the total period involved, that were in 
     excess of the maximum amount that would have been allowable 
     under applicable provisions of subchapter III of chapter 83 
     of title 5, United States Code (including any earnings 
     thereon).
       (d) Definition of Total Period Involved.--For purposes of 
     this section, the term ``total period involved'' means the 
     period beginning on the effective date of the retirement 
     coverage error involved and ending on the day before the date 
     on which the election described in subsection (a) is made.

     SEC. 106. EFFECT OF ELECTION TO REMAIN FERS COVERED AFTER 
                   HAVING BEEN CORRECTED TO FERS FROM CSRS-OFFSET 
                   (OR CSRS).

       (a) Applicability.--This section shall apply in the case of 
     any employee affected by an error described in paragraph (1) 
     or (2) of section 101(a) who (after having been corrected to 
     FERS coverage) elects the option under section 101(c)(2).
       (b) Disposition of Contributions to the CSRDF.--The 
     provisions of section 102(b) shall apply in the case of an 
     employee described in subsection (a), subject to the same 
     condition as set forth in section 105(b)(2)(A).
       (c) Makeup Contributions to the Thrift Savings Fund.--
     Section 102(c) shall apply, except that an agency shall 
     receive credit for any automatic or matching Government 
     contributions and any lost earnings paid by such agency as 
     part of any corrections process previously carried out with 
     respect to the employee involved.

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

     SEC. 111. ELECTIONS.

       (a) Applicability.--This subtitle shall apply in the case 
     of any employee who--
       (1) should be (or should have been) FERS covered but, as a 
     result of a retirement coverage error, is (or was) Social 
     Security-Only covered instead;
       (2) should be (or should have been) CSRS-Offset covered 
     but, as a result of a retirement coverage error, is (or was) 
     Social Security-Only covered instead; or
       (3) should be (or should have been) CSRS covered but, as a 
     result of a retirement coverage error, is (or was) Social 
     Security-Only covered instead.
       (b) Uncorrected Error.--If, at the time of making an 
     election under this section, the retirement coverage error 
     described in paragraph (1), (2), or (3) of subsection (a) (as 
     applicable) has not been corrected, the employee affected by 
     such error may elect--
       (1)(A) in the case of an error described in subsection 
     (a)(1), to be FERS covered as well;
       (B) in the case of an error described in subsection (a)(2), 
     to be CSRS-Offset covered as well; or
       (C) in the case of an error described in subsection (a)(3), 
     to be CSRS covered instead; or
       (2) to remain Social Security-Only covered.
       (c) Corrected Error.--
       (1) In general.--Not later than 6 months after the date of 
     enactment of this Act, there shall be submitted to the 
     Congress a proposal (including any necessary draft 
     legislation) to carry out the policy described in paragraph 
     (2).
       (2) Policy.--Under the proposal, any employee with respect 
     to whom the retirement coverage error described in paragraph 
     (1), (2), or (3) of subsection (a) (as applicable) has 
     already been corrected, but under terms less advantageous to 
     the employee than would have been the case under this Act, 
     shall be afforded a reasonable opportunity to obtain 
     treatment comparable to the treatment afforded under this 
     Act.
       (3) Joint action.--This subsection shall be carried out by 
     the Director of the Office of Personnel Management, in 
     consultation with the Executive Director of the Federal 
     Retirement Thrift Investment Board and the Commissioner of 
     Social Security.
       (d) Default Rule.--In the case of any employee to whom 
     subsection (b) applies, if the employee is given written 
     notice in accordance with section 201 as to the availability 
     of an election under this section, but does not make any such 
     election within the 6-month period beginning on the date on 
     which such notice is so given, the option under subsection 
     (b)(2) shall be deemed to have been elected on the last day 
     of such period.
       (e) Retroactive Effect.--An election under this section 
     (including an election by default, and an election to remain 
     covered by the retirement system by which the electing 
     individual is covered as of the date of the election) shall 
     be effective retroactive to the effective date of the 
     retirement coverage error (as referred to in subsection (a)) 
     to which such election relates.

[[Page H5905]]

     SEC. 112. EFFECT OF AN ELECTION TO BECOME FERS COVERED TO 
                   CORRECT THE RETIREMENT COVERAGE ERROR.

       (a) Applicability.--This section shall apply in the case of 
     any employee affected by an error described in section 
     111(a)(1) who elects the option under section 111(b)(1)(A).
       (b) Makeup Contributions to the CSRDF.--Upon notification 
     that an employee has made an election under this section, the 
     agency in or under which such employee is employed shall 
     promptly pay to the CSRDF, in a lump sum, an amount equal to 
     the sum of--
       (1) the amount that should have been deducted and withheld 
     from the pay of the employee for the period of erroneous 
     coverage involved under section 8422 of title 5, United 
     States Code; and
       (2) the Government contributions that should have been paid 
     for the period of erroneous coverage involved under section 
     8423 of title 5, United States Code.
       (c) Makeup Contributions to the Thrift Savings Fund.--
     Section 102(c) shall apply in the case of an employee 
     described in subsection (a).

     SEC. 113. EFFECT OF AN ELECTION TO BECOME CSRS-OFFSET COVERED 
                   TO CORRECT THE RETIREMENT COVERAGE ERROR.

       (a) Applicability.--This section shall apply in the case of 
     any employee affected by an error described in section 
     111(a)(2) who elects the option under section 111(b)(1)(B).
       (b) Makeup Contributions to the CSRDF.--Upon notification 
     that an employee has made an election under this section, the 
     agency in or under which such employee is employed shall 
     promptly pay to the CSRDF, in a lump sum, an amount equal to 
     the sum of--
       (1) the amount that should have been deducted and withheld 
     from the pay of the employee for the period of erroneous 
     coverage involved under section 8334 of title 5, United 
     States Code; and
       (2) the Government contributions that should have been paid 
     under section 8334 of title 5, United States Code, for the 
     period of erroneous coverage involved.
       (c) Makeup Contributions to the Thrift Savings Fund.--
       (1) In general.--Makeup contributions to the Thrift Savings 
     Fund shall be made by the employing agency in the same manner 
     as described in section 102(c) (but disregarding 
     subparagraphs (B) and (C) of paragraph (1) thereof, and the 
     other provisions of section 102(c) to the extent that they 
     relate to those subparagraphs).
       (2) Appropriate percentages, etc. to be used.--For purposes 
     of paragraph (1), section 102(c) shall be applied--
       (A) by substituting ``section 8351(b)'' for ``section 
     8432(a)'' and by substituting ``CSRS covered and CSRS-Offset 
     covered'' for ``FERS covered'' in paragraph (2)(B)(i) 
     thereof; and
       (B) by substituting ``section 8351(b)(2)'' for ``section 
     8432(a)'' in paragraph (2)(C)(ii) thereof.

     SEC. 114. EFFECT OF AN ELECTION TO BECOME CSRS COVERED TO 
                   CORRECT THE RETIREMENT COVERAGE ERROR.

       (a) Applicability.--This section shall apply in the case of 
     any employee affected by an error described in section 
     111(a)(3) who elects the option under section 111(b)(1)(C).
       (b) Makeup Contributions to the CSRDF.--
       (1) In general.--Upon notification that an employee has 
     made an election under this section, the agency in or under 
     which such employee is employed shall promptly pay to the 
     CSRDF, in a lump sum, an amount equal to the sum of--
       (A) the amount that should have been deducted and withheld 
     from the pay of the employee for the period of erroneous 
     coverage involved under section 8334 of title 5, United 
     States Code; and
       (B) the Government contributions that should have been paid 
     under such section for the period of erroneous coverage 
     involved.
       (2) Agency to be reimbursed for certain amounts.--
       (A) In general.--The employee for whom the payment under 
     paragraph (1) is made shall repay to the agency (referred to 
     in paragraph (1)) an amount equal to the OASDI employee taxes 
     refunded or refundable to such employee for any portion of 
     the period of erroneous coverage involved (computed in such 
     manner as the Director of the Office of Personnel Management, 
     with the concurrence of the Secretary of the Treasury, shall 
     by regulation prescribe), not to exceed the amount described 
     in paragraph (1)(A).
       (B) Right of recovery; waiver.--If the employee fails to 
     repay the amount required under subparagraph (A), a sum equal 
     to the amount outstanding is recoverable by the Government 
     from the employee (or the employee's estate, if applicable) 
     by--
       (i) setoff against accrued pay, compensation, amount of 
     retirement credit, or another amount due the employee from 
     the Government; and
       (ii) such other method as is provided by law for the 
     recovery of amounts owing to the Government.

     The head of the agency concerned may waive, in whole or in 
     part, a right of recovery under this paragraph if it is shown 
     that recovery would be against equity and good conscience or 
     against the public interest.
       (C) Treatment of amounts repaid or recovered.--Any amount 
     repaid by, or recovered from, an individual (or an estate) 
     under this paragraph shall be credited to the appropriation 
     account from which the amount involved was originally paid.
       (c) Makeup Contributions to the Thrift Savings Fund.--In 
     the case of an employee described in subsection (a), makeup 
     contributions to the Thrift Savings Fund shall be made in the 
     same manner as described in section 113(c).

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

     SEC. 121. UNCORRECTED ERROR: EMPLOYEE WHO SHOULD BE SOCIAL 
                   SECURITY-ONLY COVERED, BUT WHO IS ERRONEOUSLY 
                   FERS COVERED INSTEAD.

       (a) In General.--Except as provided in section 125, this 
     section shall apply in the case of any employee who should be 
     Social Security-Only covered but, as a result of a retirement 
     coverage error, is FERS covered instead.
       (b) Automatic Exclusion From FERS.--An employee described 
     in subsection (a) shall not, by reason of the retirement 
     coverage error described in subsection (a), be eligible to be 
     treated as an individual who is FERS covered.
       (c) Disposition of Employee Contributions to the CSRDF.--
     There shall be paid to the employee, from the CSRDF, any 
     lump-sum credit to which such employee would be entitled 
     under section 8424 of title 5, United States Code, to the 
     extent attributable to the period of erroneous coverage 
     involved.
       (d) Disposition of TSP Contributions.--
       (1) Government contributions.--All Government contributions 
     made on behalf of the employee to the Thrift Savings Fund 
     that are attributable to the period of erroneous coverage 
     involved (including any earnings thereon) shall be forfeited 
     in the same manner as described in section 105(c).
       (2) Employee contributions.--Notwithstanding any other 
     provision of this section or any other provision of law, any 
     contributions made by the employee to the Thrift Savings Fund 
     during the period of erroneous coverage involved (including 
     any earnings thereon) shall be treated as if such employee 
     had then been correctly covered.

     SEC. 122. UNCORRECTED ERROR: EMPLOYEE WHO SHOULD BE SOCIAL 
                   SECURITY-ONLY COVERED, BUT WHO IS ERRONEOUSLY 
                   CSRS-OFFSET COVERED INSTEAD.

       (a) In General.--Except as provided in section 125, this 
     section shall apply in the case of any employee who should be 
     Social Security-Only covered but, as a result of a retirement 
     coverage error, is CSRS-Offset covered instead.
       (b) Automatic Exclusion From CSRS-Offset.--An employee 
     described in subsection (a) shall not, by reason of the 
     retirement coverage error described in subsection (a), be 
     eligible to be treated as an individual who is CSRS-Offset 
     covered.
       (c) Disposition of Employee Contributions to the CSRDF.--
     There shall be paid to the employee, from the CSRDF, the 
     lump-sum credit to which such employee would be entitled 
     under section 8342 of title 5, United States Code, to the 
     extent attributable to the period of erroneous coverage 
     involved.
       (d) Disposition of TSP Contributions.--In the case of an 
     employee described in subsection (a), section 121(d)(2) shall 
     apply.

     SEC. 123. UNCORRECTED ERROR: EMPLOYEE WHO SHOULD BE SOCIAL 
                   SECURITY-ONLY COVERED, BUT WHO IS ERRONEOUSLY 
                   CSRS COVERED INSTEAD.

       (a) In General.--Except as provided in section 125, this 
     section shall apply in the case of any employee who should be 
     Social Security-Only covered but, as a result of a retirement 
     coverage error, is CSRS covered instead.
       (b) Automatic Exclusion From CSRS.--An employee described 
     in subsection (a) shall not, by reason of the retirement 
     coverage error described in subsection (a), be eligible to be 
     treated as an individual who is CSRS covered.
       (c) Disposition of Contributions to the CSRDF.--
       (1) In general.--In the case of an employee described in 
     subsection (a), section 102(b) shall apply.
       (2) Irrelevant provisions to be disregarded.--For purposes 
     of paragraph (1), section 102(b) shall be applied 
     disregarding the provisions of paragraphs (1)(B)(ii)(II) (to 
     the extent they relate to amounts that should have been 
     deducted under section 8422 of title 5, United States Code) 
     and (2)(B)(ii)(II) thereof.
       (d) Disposition of TSP Contributions.--In the case of an 
     employee described in subsection (a), section 121(d)(2) shall 
     apply.

     SEC. 124. CORRECTED ERROR: SITUATIONS UNDER SECTIONS 121-123.

       (a) In General.--Not later than 6 months after the date of 
     enactment of this Act, there shall be submitted to the 
     Congress a proposal (including any necessary draft 
     legislation) to carry out the policy described in subsection 
     (b).
       (b) Policy.--Under the proposal, any employee with respect 
     to whom the applicable retirement coverage error (referred to 
     in section 121, 122, or 123, as applicable) has already been 
     corrected, but under terms less advantageous to the employee 
     than would have been the case under this Act, shall be 
     afforded a reasonable opportunity to obtain treatment 
     comparable to the treatment afforded under this Act.
       (c) Joint Action.--This section shall be carried out by the 
     Director of the Office of Personnel Management, in 
     consultation with the Executive Director of the Federal 
     Retirement Thrift Investment Board and the Commissioner of 
     Social Security.

[[Page H5906]]

     SEC. 125. VESTED EMPLOYEES EXCEPTED FROM AUTOMATIC EXCLUSION.

       (a) In General.--Nothing in this subtitle shall, by reason 
     of any retirement coverage error, result in the automatic 
     exclusion of any employee from FERS, CSRS-Offset, or CSRS if, 
     as of the date on which notice of such error is given (in 
     accordance with section 201), such employee's rights have 
     vested under the retirement system involved.
       (b) Vesting.--For purposes of this section, vesting of 
     rights shall be considered to have occurred if the employee 
     has (by the date as of which the determination is made) 
     completed at least 5 years of civilian service, taking into 
     account only creditable service under section 8332 or 8411 of 
     title 5, United States Code.
       (c) Elections.--
       (1) Erroneously fers covered.--Any employee affected by an 
     error described in section 121 who is determined under this 
     section to satisfy subsection (b) may elect--
       (A) to be treated in accordance with section 121; or
       (B) to remain FERS covered.
       (2) Other cases.--Any employee affected by an error 
     described in section 122 or 123 who is determined under this 
     section to satisfy subsection (b) may elect--
       (A) to be treated in accordance with section 122 or 123 (as 
     applicable); or
       (B) to remain (or instead become) CSRS-Offset covered.
       (d) Effect of An Election To Be Transferred from CSRS to 
     CSRS-Offset.--In the case of an employee affected by an error 
     described in section 123 who elects the option under 
     subsection (c)(2)(B), the effect of the election shall be the 
     same as described in section 104.
       (e) Default Rule.--If the employee does not make any 
     election within the 6-month period beginning on the date on 
     which the appropriate notice is given to such employee, the 
     option under paragraph (1)(B) or (2)(B) of subsection (c), as 
     applicable, shall be deemed to have been elected as of the 
     last day of such period. Nothing in this section shall be 
     considered to afford an employee the option of becoming or 
     remaining CSRS covered.
       (f) Retroactive Effect.--An election under this section 
     (including an election by default, and an election to remain 
     covered by the retirement system by which the electing 
     individual is covered as of the date of the election) shall 
     be effective retroactive to the effective date of the 
     retirement coverage error to which the election relates.
       (g) Special Rule In Case of Disability.--If, as of the date 
     referred to in subsection (a), the employee is entitled to 
     receive an annuity under chapter 83 or 84 of title 5, United 
     States Code, based on disability, or compensation under 
     subchapter I of chapter 81 of such title for injury to, or 
     disability of, such employee, subsections (a) and (b) shall 
     be applied by substituting (for the date that would otherwise 
     apply) the date as of which entitlement to such annuity or 
     compensation terminates (if at all).
       (h) Notification.--Any notice under section 201 shall 
     include such additional information or other modifications as 
     the Office of Personnel Management may by regulation 
     prescribe in connection with the situations covered by this 
     subtitle, particularly as they relate to the consequences of 
     being vested or not being vested.

 Subtitle D--Employee Who Should Have Been CSRS Covered or CSRS-Offset 
         Covered, But Who Was Erroneously FERS Covered Instead

     SEC. 131. ELECTIONS.

       (a) Applicability.--This subtitle shall apply in the case 
     of any employee who--
       (1) should be (or should have been) CSRS covered but, as a 
     result of a retirement coverage error, is (or was) FERS 
     covered instead; or
       (2) should be (or should have been) CSRS-Offset covered 
     but, as a result of a retirement coverage error, is (or was) 
     FERS covered instead.
       (b) Uncorrected Error.--If, at the time of making an 
     election under this section, the retirement coverage error 
     described in paragraph (1) or (2) of subsection (a) (as 
     applicable) has not been corrected, the employee affected by 
     such error may elect--
       (1)(A) in the case of an error described in subsection 
     (a)(1), to be CSRS covered instead; or
       (B) in the case of an error described in subsection (a)(2), 
     to be CSRS-Offset covered instead; or
       (2) to remain FERS covered.
       (c) Corrected Error.--If, at the time of making an election 
     under this section, the retirement coverage error described 
     in paragraph (1) or (2) of subsection (a) (as applicable) has 
     been corrected, the employee affected by such error may 
     elect--
       (1) to be FERS covered instead; or
       (2)(A) in the case of an error described in subsection 
     (a)(1), to remain CSRS covered; or
       (B) in the case of an error described in subsection (a)(2), 
     to remain CSRS-Offset covered.
       (d) Default Rule.--If the employee is given written notice 
     in accordance with section 201 as to the availability of an 
     election under this section, but does not make any such 
     election within the 6-month period beginning on the date on 
     which such notice is so given, the option under subsection 
     (b)(2) or (c)(2), as applicable, shall be deemed to have been 
     elected on the last day of such period.
       (e) Retroactive Effect.--An election under this section 
     (including an election by default, and an election to remain 
     covered by the retirement system by which the electing 
     individual is covered as of the date of the election) shall 
     be effective retroactive to the effective date of the 
     retirement coverage error (as referred to in subsection (a)) 
     to which such election relates.

     SEC. 132. EFFECT OF AN ELECTION TO BE TRANSFERRED FROM FERS 
                   TO CSRS TO CORRECT A RETIREMENT COVERAGE ERROR.

       (a) Applicability.--This section shall apply in the case of 
     any employee affected by an error described in section 
     131(a)(1) who elects the option available to such employee 
     under section 131(b)(1)(A).
       (b) Makeup Contributions to the CSRDF.--
       (1) In general.--Upon notification that an employee has 
     made an election under this section, the agency in or under 
     which such employee is employed shall promptly pay to the 
     CSRDF, in a lump sum, an amount equal to the excess of--
       (A) the amount by which--
       (i) the amount that should have been deducted and withheld 
     from the pay of the employee for the period of erroneous 
     coverage involved under section 8334 of title 5, United 
     States Code, exceeds
       (ii) the amount that was actually deducted and withheld 
     from the pay of the employee for the period of erroneous 
     coverage involved under section 8422 of such title (and not 
     refunded), over
       (B) the amount by which--
       (i) the amount of the Government contributions actually 
     made under section 8423 of such title with respect to the 
     employee for the period of erroneous coverage involved, 
     exceeds
       (ii) the amount of the Government contributions that should 
     have been made under section 8334 of such title with respect 
     to the employee for the period of erroneous coverage 
     involved.
       (2) Agency to be reimbursed for certain amounts.--
       (A) In general.--The employee for whom the payment under 
     paragraph (1) is made shall repay to the agency (referred to 
     in paragraph (1)) an amount equal to the OASDI employee taxes 
     refunded or refundable to such employee for any portion of 
     the period of erroneous coverage involved (computed in such 
     manner as the Director of the Office of Personnel Management, 
     with the concurrence of the Commissioner of Social Security, 
     shall by regulation prescribe), not to exceed the amount 
     described in paragraph (1)(A).
       (B) Right of recovery; waiver.--If the employee fails to 
     repay the amount required under subparagraph (A), a sum equal 
     to the amount outstanding is recoverable by the Government 
     from the employee (or the employee's estate, if applicable) 
     by--
       (i) setoff against accrued pay, compensation, amount of 
     retirement credit, or another amount due the employee from 
     the Government; and
       (ii) such other method as is provided by law for the 
     recovery of amounts owing to the Government.

     The head of the agency concerned may waive, in whole or in 
     part, a right of recovery under this paragraph if it is shown 
     that recovery would be against equity and good conscience or 
     against the public interest.
       (C) Treatment of amounts repaid or recovered.--Any amount 
     repaid by, or recovered from, an individual (or an estate) 
     under this paragraph shall be credited to the appropriation, 
     fund, or account from which the amount involved was 
     originally paid.
       (c) Disposition of Excess TSP Contributions.--Section 
     105(c) shall apply in the case of an employee described in 
     subsection (a).

     SEC. 133. EFFECT OF AN ELECTION TO BE TRANSFERRED FROM FERS 
                   TO CSRS-OFFSET TO CORRECT A RETIREMENT COVERAGE 
                   ERROR.

       (a) Applicability.--This section shall apply in the case of 
     any employee affected by an error described in section 
     131(a)(2) who elects the option available to such employee 
     under section 131(b)(1)(B).
       (b) Effect.--The effect of an election referred to in 
     subsection (a) shall be substantially the same as that 
     described in section 105.

     SEC. 134. EFFECT OF AN ELECTION TO BE RESTORED TO FERS AFTER 
                   HAVING BEEN CORRECTED TO CSRS.

       (a) Applicability.--This section shall apply in the case of 
     any employee affected by an error described in section 
     131(a)(1) who elects the option under section 131(c)(1).
       (b) Effect.--The effect of an election referred to in 
     subsection (a) shall be substantially the same as that 
     described in section 102.

     SEC. 135. EFFECT OF AN ELECTION TO BE RESTORED TO FERS AFTER 
                   HAVING BEEN CORRECTED TO CSRS-OFFSET.

       (a) Applicability.--This section shall apply in the case of 
     any employee affected by an error described in section 
     131(a)(2) who elects the option under section 131(c)(1).
       (b) Effect.--The effect of an election referred to in 
     subsection (a) shall be substantially the same as that 
     described in section 103.

     SEC. 136. DISQUALIFICATION OF CERTAIN INDIVIDUALS TO WHOM 
                   SAME ELECTION WAS PREVIOUSLY AVAILABLE.

       Notwithstanding any other provision of this subtitle, an 
     election under this subtitle shall not be available in the 
     case of any individual to whom an election under section 
     846.204 of title 5 of the Code of Federal Regulations (as in 
     effect as of January 1, 1997) was

[[Page H5907]]

     made available in connection with the same error pursuant to 
     notification provided in accordance with such section.

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

     SEC. 141. AUTOMATIC TRANSFER TO CSRS-OFFSET.

       (a) Applicability.--This subtitle shall apply in the case 
     of any employee who should be (or should have been) CSRS-
     Offset covered but, as a result of a retirement coverage 
     error, is (or was) CSRS covered instead.
       (b) Uncorrected Error.--If the error has not been 
     corrected, the employee shall be treated in the same way as 
     if such employee had instead been CSRS-Offset covered, 
     effective retroactive to the effective date of such error.
       (c) Corrected Error.--If the error has been corrected, the 
     correction shall (to the extent not already carried out) be 
     made effective retroactive to the effective date of such 
     error.

     SEC. 142. EFFECT OF TRANSFER.

       The effect of a transfer under section 141 shall be as set 
     forth in regulations which the Office of Personnel Management 
     shall prescribe consistent with section 104.

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

     SEC. 151. ELECTIONS.

       (a) Applicability.--This subtitle shall apply in the case 
     of any employee who should be (or should have been) CSRS 
     covered but, as a result of a retirement coverage error, is 
     (or was) CSRS-Offset covered instead.
       (b) Uncorrected Error.--If, at the time of making an 
     election under this section, the retirement coverage error 
     described in subsection (a) has not been corrected, the 
     employee affected by such error may elect--
       (1) to be CSRS covered instead; or
       (2) to remain CSRS-Offset covered.
       (c) Corrected Error.--If, at the time of making an election 
     under this section, the retirement coverage error described 
     in subsection (a) has been corrected, the employee affected 
     by such error may elect--
       (1) to be CSRS-Offset covered instead; or
       (2) to remain CSRS covered.
       (d) Default Rule.--If the employee is given written notice 
     in accordance with section 201 as to the availability of an 
     election under this section, but does not make any such 
     election within the 6-month period beginning on the date on 
     which such notice is so given, the option under subsection 
     (b)(2) or (c)(2), as applicable, shall be deemed to have been 
     elected on the last day of such period.
       (e) Retroactive Effect.--An election under this section 
     (including an election by default, and an election to remain 
     covered by the retirement system by which the electing 
     individual is covered as of the date of the election) shall 
     be effective retroactive to the effective date of the 
     retirement coverage error (as referred to in subsection (a)) 
     to which such election relates.

     SEC. 152. EFFECT OF AN ELECTION TO BE TRANSFERRED FROM CSRS-
                   OFFSET TO CSRS TO CORRECT THE RETIREMENT 
                   COVERAGE ERROR.

       (a) Applicability.--This section shall apply in the case of 
     any employee affected by an error described in section 151(a) 
     who elects the option available to such employee under 
     section 151(b)(1).
       (b) Makeup Contributions to the CSRDF.--
       (1) In general.--Upon notification that an employee has 
     made an election under this section, the agency in or under 
     which such employee is employed shall promptly pay to the 
     CSRDF, in a lump sum, an amount equal to the amount by 
     which--
       (A) the amount that should have been deducted and withheld 
     from the pay of the employee for the period of erroneous 
     coverage involved under section 8334 of title 5, United 
     States Code (by virtue of being CSRS covered), exceeds
       (B) any amounts actually deducted and withheld from the pay 
     of the employee for the period of erroneous coverage involved 
     under such section (pursuant to CSRS-Offset coverage).
       (2) Agency to be reimbursed for certain amounts.--
       (A) In general.--The employee for whom the payment under 
     paragraph (1) is made shall repay to the agency (referred to 
     in paragraph (1)) an amount equal to the OASDI employee taxes 
     refunded or refundable to such employee for any portion of 
     the period of erroneous coverage involved (computed in such 
     manner as the Director of the Office of Personnel Management, 
     with the concurrence of the Commissioner of Social Security, 
     shall by regulation prescribe), not to exceed the amount 
     described in paragraph (1)(A).
       (B) Right of recovery; waiver.--If the employee fails to 
     repay the amount required under subparagraph (A), a sum equal 
     to the amount outstanding is recoverable by the Government 
     from the employee (or the employee's estate, if applicable) 
     by--
       (i) setoff against accrued pay, compensation, amount of 
     retirement credit, or another amount due the employee from 
     the Government; and
       (ii) such other method as is provided by law for the 
     recovery of amounts owing to the Government.

     The head of the agency concerned may waive, in whole or in 
     part, a right of recovery under this paragraph if it is shown 
     that recovery would be against equity and good conscience or 
     against the public interest.
       (C) Treatment of amounts repaid or recovered.--Any amount 
     repaid by, or recovered from, an individual (or an estate) 
     under this paragraph shall be credited to the appropriation, 
     fund, or account from which the amount involved was 
     originally paid.
       (3) Deposit to be based on amount of refund actually 
     received.--For purposes of applying sections 8334(d)(1) and 
     8339(i) of title 5, United States Code, in the case of an 
     employee described in subsection (a) who has received a 
     refund of deductions that are attributable to a period when 
     the employee was erroneously CSRS-Offset covered, nothing in 
     either of those sections shall be considered to require that, 
     in order to receive credit for that period as a CSRS-covered 
     employee, a deposit be made in excess of the refund actually 
     received for such period, plus interest.

     SEC. 153. EFFECT OF AN ELECTION TO BE RESTORED TO CSRS-OFFSET 
                   AFTER HAVING BEEN CORRECTED TO CSRS.

       (a) Applicability.--This section shall apply in the case of 
     any employee affected by an error described in section 151(a) 
     who elects the option available to such employee under 
     section 151(c)(1).
       (b) Disposition of Contributions to the CSRDF.--In the case 
     of an employee described in subsection (a), the provisions of 
     section 102(b) shall apply, except that, in applying such 
     provisions--
       (1) ``the applicable provisions of section 8334'' shall be 
     substituted for ``section 8422'' in paragraph (1)(B)(ii)(II) 
     thereof; and
       (2) ``the applicable provisions of section 8334'' shall be 
     substituted for ``section 8423'' in paragraph (2)(B)(ii)(II) 
     thereof.

   Subtitle G--Additional Provisions Relating to Government Agencies

     SEC. 161. REPAYMENT REQUIRED IN CERTAIN SITUATIONS.

       (a) In General.--An individual who previously received a 
     payment ordered by a court or provided as a settlement of 
     claim for losses resulting from a retirement coverage error 
     shall not be entitled to make an election under this Act 
     unless repayment of the amount so received by such individual 
     is waived in whole or in part by the Office of Personnel 
     Management, and any amount not waived is repaid.
       (b) Regulations.--Any repayment under this section shall be 
     made in accordance with regulations prescribed by the Office.

     SEC. 162. EQUITABLE SHARING OF AMOUNTS PAYABLE FROM THE 
                   GOVERNMENT IF MORE THAN ONE AGENCY INVOLVED.

       The Office of Personnel Management shall by regulation 
     prescribe rules under which, in the case of an employee who 
     has been employed in or under more than 1 agency since the 
     date of the retirement coverage error involved (and before 
     its rectification under this Act), any contributions or other 
     amounts required to be paid from the then current employing 
     agency (other than lost earnings under section 163(a)(2)) 
     shall be equitably allocated between or among the appropriate 
     agencies.

     SEC. 163. PROVISIONS RELATING TO THE ORIGINAL RESPONSIBLE 
                   AGENCY.

       (a) Obligations of the Original Responsible Agency.--
       (1) Expenses for services of financial advisor.--The Office 
     of Personnel Management shall by regulation prescribe rules 
     under which, in the case of any employee eligible to make an 
     election under this Act, the original responsible agency (as 
     determined under succeeding provisions of this section) shall 
     pay (or make reimbursement for) any reasonable expenses 
     incurred by such employee for services received from any 
     licensed financial or legal consultant or advisor in 
     connection with such election.
       (2) Special rule.--Such regulations shall also include 
     provisions to ensure that, to the extent lost earnings under 
     the Thrift Savings Fund are involved in connection with a 
     particular error, the original responsible agency shall pay 
     (or reimburse any other agency that pays) any amounts to the 
     Thrift Savings Fund representing lost earnings with respect 
     to such error.
       (b) Original Responsible Agency Defined.--For purposes of 
     this Act, the term ``original responsible agency'', with 
     respect to a retirement coverage error affecting an employee, 
     means--
       (1) except in the situation described in paragraph (2), the 
     agency determined by the Office of Personnel Management to 
     have made the initial retirement coverage error (including 
     one made before January 1, 1984); or
       (2) if the error is attributable, in whole or in part, to 
     an erroneous regulation promulgated by the Office of 
     Personnel Management, such Office.
       (c) Procedures for Identifying the Original Responsible 
     Agency.--
       (1) In general.--For purposes of this section, the original 
     responsible agency, in any situation to which this section 
     applies, shall be identified by the Office of Personnel 
     Management in accordance with regulations which the Office 
     shall prescribe.
       (2) Finality.--A determination made by the Office under 
     this subsection shall be final and not subject to any review.
       (d) If Original Responsible Agency No Longer Exists.--If 
     the agency which (before the application of this subsection) 
     is identified as the original responsible agency no

[[Page H5908]]

     longer exists (whether because of a reorganization or 
     otherwise)--
       (1) the successor agency (as determined under regulations 
     prescribed by the Office) shall be treated as the original 
     responsible agency; or
       (2) if none, this section shall be applied by substituting 
     the CSRDF for the original responsible agency.
       (e) Source of Payments If Error Due to Erroneous OPM 
     Regulations.--In any case in which the Office of Personnel 
     Management is the original responsible agency by reason of 
     subsection (b)(2), any amounts payable from the Office under 
     this section shall be payable from the CSRDF.

                      TITLE II--GENERAL PROVISIONS

     SEC. 201. IDENTIFICATION AND NOTIFICATION REQUIREMENTS.

       (a) In General.--The Office of Personnel Management shall 
     prescribe regulations under which Government agencies shall 
     take such measures as may be necessary to ensure that all 
     individuals who are (or have been) affected by a retirement 
     coverage error giving rise to any election or automatic 
     change in retirement coverage under this Act shall be 
     promptly identified and notified in accordance with this 
     section.
       (b) Matter To Be Included in Notice to Individuals.--Any 
     notice furnished under this section shall be made in writing 
     and shall include at least the following:
       (1) Description of error.--A description of the error 
     involved, including a clear and concise explanation as to why 
     the original retirement coverage determination was erroneous, 
     citations to (and a summary description of) the pertinent 
     provisions of law, and how that determination should instead 
     have been made.
       (2) Method for rectification.--How the error is to be 
     rectified under this Act, including whether rectification 
     will be achieved through an automatic change in retirement 
     coverage (and, if so, the time, form, and manner in which 
     that change will be effected) or an election.
       (3) Election procedures, etc.--If an election is provided 
     under this Act, all relevant information as to how such an 
     election may be made, the options available, the differences 
     between those respective options (as further specified in 
     succeeding provisions of this subsection), and the 
     consequences of failing to make a timely election.
       (4) Accrued benefits, etc.--With respect to the (or each) 
     retirement system by which the individual is then covered 
     (disregarding the Thrift Savings Plan), and to the extent 
     applicable:
       (A) A brief summary of any benefits accrued.
       (B) The amount of employee contributions made to date and 
     the effect of any applicable disposition rules relating 
     thereto (including provisions relating to excess amounts or 
     shortfalls).
       (C) The amount of any Government contributions made to date 
     and the effect of any applicable disposition rules relating 
     thereto (including provisions relating to excess amounts or 
     shortfalls).
       (5) Thrift savings fund.--With respect to the Thrift 
     Savings Fund, the balance that then is (or would be) credited 
     to the individual's account depending on the option chosen, 
     with any such balance to be shown both in the aggregate and 
     broken down by--
       (A) individual contributions,
       (B) automatic (1 percent) Government contributions, and
       (C) matching Government contributions,
     including lost earnings on each and the extent to which any 
     makeup contributions or forfeitures would be involved.
       (6) OASDI benefits.--Such information regarding benefits 
     under title II of the Social Security Act as the Commissioner 
     of Social Security considers appropriate.
       (7) Other information.--Any other information that the 
     Director of the Office of Personnel Management may by 
     regulation prescribe after consultation with the Executive 
     Director of the Federal Retirement Thrift Investment Board 
     and such other agency heads as the Director considers 
     appropriate, including any appeal rights available to the 
     individual.
       (c) Comparisons.--Any amounts required to be included under 
     subsection (b)(4) shall, with respect to the respective 
     retirement systems involved, be determined--
       (1) as of the date the retirement coverage error was 
     corrected (if applicable);
       (2) as of the then most recent date for which those 
     benefits and amounts are ascertainable, assuming no change in 
     retirement coverage; and
       (3) as of the then most recent date for which those 
     benefits and amounts are ascertainable, assuming the 
     alternative option is chosen.
       (d) Past Errors.--All measures required under this section 
     shall, with respect to errors preceding the date specified in 
     section 206(e) (relating to the effective date for all 
     regulations prescribed under this Act), be completed no later 
     than December 31, 2001.

     SEC. 202. INDIVIDUAL APPEAL RIGHTS.

       (a) In General.--An individual aggrieved by a final 
     determination under this Act shall be entitled to appeal such 
     determination to the Merit Systems Protection Board under 
     section 7701 of title 5, United States Code.
       (b) Notification Appeals.--The Office of Personnel 
     Management shall by regulation establish procedures under 
     which individuals may bring an appeal to the Office with 
     respect to any failure to have been properly notified in 
     accordance with section 201. A final determination under this 
     subsection shall be appealable under subsection (a).

     SEC. 203. INFORMATION TO BE FURNISHED BY GOVERNMENT AGENCIES 
                   TO AUTHORITIES ADMINISTERING THIS ACT.

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

     SEC. 204. SOCIAL SECURITY RECORDS.

       Notwithstanding any limitations in section 205 of the 
     Social Security Act regarding the modification of wage 
     records maintained by the Commissioner of Social Security for 
     purposes of title II of such Act, the Commissioner of Social 
     Security shall modify the wage record of each employee 
     affected by a retirement coverage error to change, add, or 
     delete any entry regarding service as an employee to the 
     extent necessary to carry out the purposes of this Act or the 
     Social Security Act.

     SEC. 205. CONFORMING AMENDMENTS RESPECTING SOCIAL SECURITY 
                   COVERAGE AND OASDI TAXES.

       (a) Social Security Coverage.--Section 210(a)(5)(H) of the 
     Social Security Act (42 U.S.C. 410(a)(5)(H)) is amended--
       (1) in clause (i) by striking ``or'' at the end;
       (2) in clause (ii) by striking the semicolon and inserting 
     ``, or''; and
       (3) by adding at the end the following:
       ``(iii)(I) described in section 111(a)(3) of the Federal 
     Retirement Coverage Corrections Act, on or after the 
     effective date of an election (or deemed election) by such 
     individual under section 111(b)(2) of such Act,
       ``(II) described in section 131(a)(1) of such Act, on or 
     after the effective date of an election (or deemed election) 
     by such individual under subsection (b)(2) or (c)(1) of 
     section 131 of such Act, or
       ``(III) described in section 151(a) of such Act, on or 
     after the effective date of an election (or deemed election) 
     by such individual under subsection (b)(2) or (c)(1) of 
     section 151 of such Act;''.
       (b) OASDI Taxes.--Section 3121(b)(5)(H) of the Internal 
     Revenue Code of 1986 is amended--
       (1) in clause (i) by striking ``or'' at the end;
       (2) in clause (ii) by striking the semicolon and inserting 
     ``, or''; and
       (3) by adding at the end the following:
       ``(iii)(I) described in section 111(a)(3) of the Federal 
     Retirement Coverage Corrections Act, on or after the 
     effective date of an election (or deemed election) by such 
     individual under section 111(b)(2) of such Act,
       ``(II) described in section 131(a)(1) of such Act, on or 
     after the effective date of an election (or deemed election) 
     by such individual under subsection (b)(2) or (c)(1) of 
     section 131 of such Act, or
       ``(III) described in section 151(a) of such Act, on or 
     after the effective date of an election (or deemed election) 
     by such individual under subsection (b)(2) or (c)(1) of 
     section 151 of such Act;''.

     SEC. 206. REGULATIONS.

       (a) In General.--Any regulations necessary to carry out 
     this Act shall be prescribed by the Director of the Office of 
     Personnel Management, the Executive Director of the Federal 
     Retirement Thrift Investment Board, the Commissioner of 
     Social Security, the Secretary of the Treasury, and any other 
     appropriate authority, with respect to matters within their 
     respective areas of jurisdiction.
       (b) Matters To Be Included.--The regulations prescribed by 
     the Director of the Office of Personnel Management shall 
     include at least the following:
       (1) Former employees, annuitants, and survivor 
     annuitants.--
       (A) In general.--Provisions under which, to the maximum 
     extent practicable and in appropriate circumstances, any 
     election available to an employee under subtitle A, B, D, or 
     F of title I shall be available to a former employee, 
     annuitant, or survivor annuitant.
       (B) Subtitle c situations.--Provisions under which subtitle 
     C of title I shall apply in the case of a former employee.
       (C) Subtitle e situations.--Provisions under which the 
     purposes of this paragraph shall be carried with respect to 
     any situation under subtitle E of title I.
       (2) Former spouses.--Provisions under which appropriate 
     notification shall be afforded to any former spouse affected 
     by a change in retirement coverage pursuant to this Act.
       (3) Procedural requirements.--Provisions establishing the 
     procedural requirements in accordance with which any 
     determinations under this Act (not otherwise addressed in

[[Page H5909]]

     this Act) shall be made, in conformance with the requirements 
     of this Act.
       (4) Authority to make actuarial reduction in annuity by 
     reason of certain unpaid amounts.--Provisions under which any 
     payment required to be made by an individual to the 
     Government in order to make an election under this Act which 
     remains unpaid may be made by a reduction in the appropriate 
     annuity or survivor annuity. The reduction shall, to the 
     extent practicable, be designed so that the present value of 
     the future reduction is actuarially equivalent to the amount 
     so required.
       (c) Definitions.--For purposes of this section--
       (1) the term ``annuitant'' means any individual who is an 
     annuitant as defined by section 8331(9) or 8401(2) of title 
     5, United States Code; and
       (2) the term ``former employee'' includes any former 
     employee who satisfies the service requirement for title to a 
     deferred annuity under chapter 83 or 84 of such title 5 (as 
     applicable), but--
       (A) has not attained the minimum age required for title to 
     such an annuity; or
       (B) has not filed claim therefor.
       (d) Coordination Rule.--In prescribing regulations to carry 
     out this Act, the Director of the Office of Personnel 
     Management shall consult with--
       (1) the Administrative Office of the United States Courts;
       (2) the Clerk of the House of Representatives;
       (3) the Sergeant at Arms and Doorkeeper of the Senate; and
       (4) other appropriate officers or authorities.
       (e) Effective Date.--All regulations necessary to carry out 
     this Act shall take effect as of the first day of the first 
     month beginning after the end of the 6-month period beginning 
     on the date of enactment of this Act.

     SEC. 207. ALL ELECTIONS TO BE APPROVED BY OPM.

       Notwithstanding any other provision of this Act, no 
     election under this Act (other than an election by default) 
     may be given effect until the Office of Personnel Management 
     has determined, in writing, that such election is in 
     compliance with the requirements of this Act.

     SEC. 208. ADDITIONAL TRANSFERS TO OASDI TRUST FUNDS IN 
                   CERTAIN CASES.

       If the Commissioner of Social Security determines that the 
     payment of the OASDI taxes described in this Act did not 
     result in a credit to the OASDI trust funds of an equal 
     amount, the Commissioner of Social Security shall notify the 
     Secretary of the Treasury of the amount of any shortfall. 
     Promptly upon receiving such notification, the Secretary of 
     the Treasury shall transfer an amount equal to such shortfall 
     from the general fund of the Treasury to the OASDI trust 
     funds.

     SEC. 209. TECHNICAL AND CONFORMING AMENDMENTS.

       (a) Amendment Relating to Limitation on Sources from which 
     Contributions to the Thrift Savings Fund Are Allowed.--
     Section 8432(h) of title 5, United States Code, is amended by 
     striking ``title.'' and inserting ``title or the Federal 
     Retirement Coverage Corrections Act.''.
       (b) Description of Amounts Comprising the Thrift Savings 
     Fund.--Section 8437(b) of title 5, United States Code, is 
     amended by striking ``expenses).'' and inserting ``expenses), 
     as well as contributions under the Federal Retirement 
     Coverage Corrections Act (and lost earnings made up under 
     such Act).''.
       (c) Administrative Expenses.--
       (1) Thrift savings plan.--Section 8437(d) of title 5, 
     United States Code, is amended by inserting ``(including the 
     provisions of the Federal Retirement Coverage Corrections Act 
     that relate to this subchapter)'' after ``this subchapter''.
       (2) CSRS, csrs-offset, fers.--Section 8348(a)(2) of title 
     5, United States Code, is amended by striking ``statutes;'' 
     and inserting ``statutes (including the provisions of the 
     Federal Retirement Coverage Corrections Act that relate to 
     this subchapter);''.
       (3) MSPB.--Section 8348(a)(3) of title 5, United States 
     Code, is amended by striking ``title.'' and inserting ``title 
     and the Federal Retirement Coverage Corrections Act.''.

                      TITLE III--OTHER PROVISIONS

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

       (a) Foreign Service.--The Secretary of State shall issue 
     regulations to provide for the application of the provisions 
     of this Act in a like manner with respect to participants, 
     annuitants, or survivors under the Foreign Service Retirement 
     and Disability System or the Foreign Service Pension System 
     (as applicable), except that--
       (1) any individual aggrieved by a final determination shall 
     appeal such determination to the Foreign Service Grievance 
     Board instead of the Merit Systems Protection Board under 
     section 202; and
       (2) the Secretary of State shall perform the functions and 
     exercise the authority vested in the Office of Personnel 
     Management or the Director of the Office of Personnel 
     Management under this Act.
       (b) Central Intelligence Agency.--Sections 292 and 301 of 
     the Central Intelligence Agency Retirement Act (50 U.S.C. 
     2141 and 2151) shall apply with respect to this Act in the 
     same manner as if this Act were part of--
       (1) the Civil Service Retirement System, to the extent this 
     Act relates to the Civil Service Retirement System; and
       (2) the Federal Employees' Retirement System, to the extent 
     this Act relates to the Federal Employees' Retirement System.

     SEC. 302. PROVISIONS TO PREVENT REDUCTIONS IN FORCE AND ANY 
                   UNFUNDED LIABILITY IN THE CSRDF.

       (a) Provisions to Prevent Reductions in Force.--
       (1) Limitation.--An agency required to make any payments 
     under this Act may not conduct any reduction in force solely 
     by reason of any current or anticipated lack of funds 
     attributable to such payments.
       (2) Alternative required.--In the circumstance described in 
     paragraph (1), any cost savings that (but for this 
     subsection) would otherwise be sought through reductions in 
     force shall instead be achieved through attrition and 
     limitations on hiring.
       (b) Provisions to Prevent Unfunded Liability.--
       (1) In general.--For purposes of section 8348(f) of title 
     5, United States Code, any unfunded liability in the CSRDF 
     created as a result of an election made (or deemed to have 
     been made) under this Act, as determined by the Office of 
     Personnel Management, shall be considered a new benefit 
     payable from the CSRDF.
       (2) Coordination rule.--Paragraph (1) shall not apply to 
     the extent that subsection (h), (i), or (m) of section 8348 
     of title 5, United States Code, would otherwise apply.

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

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

     SEC. 304. EXTENSION OF OPEN ENROLLMENT PERIOD TO EMPLOYEES 
                   UNDER THE FOREIGN SERVICE RETIREMENT AND 
                   DISABILITY SYSTEM.

       Section 860 of the Foreign Service Act of 1980 (22 U.S.C. 
     4071i) is amended by inserting after the first sentence the 
     following: ``The Secretary of State shall, in addition, issue 
     regulations providing for an election for coverage under the 
     Foreign Service Pension System for employees covered under 
     the Foreign Service Retirement and Disability System 
     comparable to the election provided for by the Federal 
     Employees' Retirement System Open Enrollment Act of 1997.''.

                        TITLE IV--TAX PROVISIONS

     SEC. 401. TAX PROVISIONS.

       (a) Plan Qualification.--No retirement plan of the United 
     States (or any agency thereof) shall fail to be treated as a 
     qualified plan under the Internal Revenue Code of 1986 by 
     reason of any action taken under this Act.
       (b) Transfers.--For purposes of the Internal Revenue Code 
     of 1986, no amount shall be includible in the gross income of 
     any individual by reason of any direct transfer under this 
     Act between funds or any Government contribution under this 
     Act to any fund or account, and no amount shall be subject to 
     tax under subtitle C of such Code by reason of any such 
     transfer or contribution.
  The SPEAKER pro tempore (Mr. Stearns). Pursuant to the rule, the 
gentleman from Florida (Mr. Mica) and the gentleman from Maryland (Mr. 
Cummings) each will control 20 minutes.
  The Chair recognizes the gentleman from Florida (Mr. Mica).


                             General Leave

  Mr. MICA. Mr. Speaker, I ask unanimous consent that all Members may 
have 5 legislative days within which to revise and extend their remarks 
on H.R. 3249, as amended, the bill under consideration.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Florida?
  There was no objection.
  Mr. MICA. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I come before the House this afternoon to present the 
Federal Retirement Coverage Corrections Act. This legislation is 
critically important to thousands of our Federal employees. This is a 
piece of legislation that has very strong bipartisan support. Both 
Republicans and Democrat members of our Subcommittee on Civil Service 
of the Committee on Government Reform and Oversight are original 
cosponsors of this bill.
  I want to take first a moment, Mr. Speaker, to thank the 
distinguished ranking member of the Subcommittee on Civil Service, the 
gentleman from Maryland (Mr. Cummings), for his leadership on this 
issue. He and I have worked very closely on this bill, and I appreciate 
the hard work that he has put forth. I also want to commend the work of 
both the majority and minority staff on this issue. I know the 
gentleman from Maryland is truly personally dedicated to bringing real 
relief to victims of these errors and the victims

[[Page H5910]]

who testified before our Subcommittee on Civil Service.
  I also commend the distinguished gentlewoman from Maryland (Mrs. 
Morella). The gentlewoman has always been a forceful advocate for our 
Federal employees, and on this issue that is no exception. She has been 
a true leader and champion. The Federal civil service employees who 
were misclassified, and their families, have benefitted greatly from 
her strong determination and her leadership in trying to right these 
wrongs.
  I also want to take this opportunity to thank the distinguished 
chairman and ranking member of the Committee on Government Reform and 
Oversight, the gentleman from Indiana (Mr. Burton) and the gentleman 
from California (Mr. Waxman), for their support.
  Likewise, I appreciate the cooperation of the chairman and ranking 
member of the Committee on Ways and Means, the gentleman from Texas 
(Mr. Archer) and the gentleman from New York (Mr. Rangel). Staffs of 
the Committee on Ways and Means and the Joint Committee on Taxation 
provided invaluable guidance on tax and Social Security issues involved 
in crafting this legislation.
  Mr. Speaker, let me take a few minutes to explain why it is so 
important for the House to pass this bill today. An estimated 18,000 
Federal employees have been placed in the wrong retirement system 
because Federal agencies, quite frankly, made mistakes. Federal 
agencies fouled up. The vast majority of these errors involved 
assignments to the Civil Service Retirement System, CSRS, or the 
Federal Employees Retirement System, generally known as FERS. But other 
agency blunders wrongly excluded some employees from both retirement 
systems. Still others were included in retirement when they did not 
qualify at all.
  When these errors are discovered, and I say are discovered because 
not all of them have been discovered, current law requires agencies to 
move them into the right retirement system. These corrections are 
especially harmful to employees who are moved from Civil Service 
Retirement, the old system, into FERS, the new system.
  Unlike the Civil Service Retirement System, which is the stand-alone 
system, the new system, FERS, consists of three components: the FERS 
basic annuity, Social Security, and the Thrift Savings Plan, or TSP. 
Without adequate Thrift Savings Plan accounts, employees will not have 
adequate retirement income, but current corrective procedures do not 
make the victim's TSP account whole. As a result, unless Congress acts, 
many victims of these errors will receive much less when they retire 
than they were really entitled to.
  H.R. 3249 provides a comprehensive solution to all of these errors. 
Although its details are complicated, it rests on a few basic, simple, 
straightforward principles.
  This bill recognizes that most victims of these agency errors had a 
legal right to participate in one of the Federal retirement systems. 
Therefore, each of these victims should have an opportunity to elect to 
participate in that system. They also have a right to receive 
approximately the same retirement benefits they could have earned if 
the agency had not erred.
  But the bill also recognizes that these victims have relied on the 
benefits promised under the system to which they were assigned. 
Accordingly, victims are generally given a choice to remain in the 
system in which they were mistakenly placed.
  Mr. Speaker, every victim should have a realistic opportunity to the 
retirement correction that best addresses their unfortunate 
circumstance. Therefore, this legislation provides fair, make-whole 
relief.
  The importance of this make-whole relief cannot be overemphasized. 
Without it, the choices offered by this bill would be nothing but a 
cruel hoax for many of our Federal employees. Lower-income employees, 
and those who have been in the wrong system for a lengthy period, would 
be especially hard hit.
  Let me cite an example described by the American Foreign Service 
Association. For about 10 years a foreign service officer was 
erroneously enrolled in the wrong system. When the error was 
discovered, he was switched to the right system. He was also told that 
he would have to contribute $65,000 to $75,000 to catch up on his 
Thrift Savings Plan account. In addition to that retroactive 
contribution, he would also have to make current contributions to the 
TSP. Mr. Speaker, few Federal employees could afford to meet such a 
burden. That is why this bill's make-whole relief is absolutely 
imperative.
  Mr. Speaker, this legislation also protects the integrity of Social 
Security trust funds and prevents employees from incurring unfair tax 
burdens because these agency errors are corrected.
  This has been, as I said, a joint effort, a bipartisan effort, to 
correct a wrong that was done to our Federal employees and Federal 
workers. This is, indeed, an effort to correct that situation, and this 
corrective legislation deserves the support of every Member of the 
House.
  Mr. Speaker, I reserve the balance of my time.
  Mr. CUMMINGS. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I am pleased that the gentleman from Florida (Mr. Mica), 
the chairman of the subcommittee, and I were able to work in a 
bipartisan way to bring this bill to the floor for a vote today. This 
legislation addresses a problem that he and I made a top priority for 
this session of Congress. It establishes a comprehensive framework to 
make whole those employees who were placed in the wrong retirement 
system by the Federal Government.
  Few things in life are more important to a working person than having 
an adequate and secure retirement plan in place to provide for their 
future or that of their spouse. When a worker's retirement security is 
jeopardized by an employer's administrative error, tremendous emotional 
and financial pain can result unless a remedy is available that ensures 
its prompt and fair correction and avoids economic harm.
  At the hearings on this matter last summer before the Subcommittee on 
Civil Service, we heard the testimony of four employees who had been 
the victims of enrollment errors made by their employing agencies. In 
each case the employee was initially placed in the Civil Service 
Retirement System, then years later informed that they should have been 
in the Federal Employees Retirement System, better known as FERS. 
Afforded no recourse or options, these employees were dumped into FERS 
and confronted with the need to make thousands of dollars of 
retroactive payments into a newly established Thrift Savings account.
  Hundreds of other fellow employees have found themselves in the same 
situation over the past 10 years. Most have been forced to rearrange 
their lives and financial plans to rectify a problem not of their own 
making. Many without financial means have had to work beyond their 
planned retirement dates to build a full annuity. At least one had to 
sell his home to raise funds to make his thrift account whole.
  Our committee, our subcommittee, heard them, we felt their pain, and 
we assured them that we would act. This situation was intolerable, and 
all of us felt the same way on our subcommittee. We made a very strong 
promise, which we have kept to those witnesses who shared their tragic 
stories at that hearing that day, that we would find a remedy. I 
believe that with the enactment of H.R. 3249, a solution will finally 
be at hand.
  The Federal Retirement Coverage Corrections Act would essentially 
permit those who have been the victims of an enrollment error to remain 
in the retirement system they were mistakenly placed in or to be 
covered by the system they should have been in. It would also hold the 
government financially responsible for making whole an affected 
employee's Thrift Savings Account. Together, these provisions will end 
the harm now being done by the existing rules governing the correction 
of these errors.
  In constructing this legislation, the chairman of the subcommittee 
sought to achieve accountability by holding those agencies guilty of 
making enrollment errors responsible for the cost of their corrections, 
and I applaud him for that. While I agree that accountability is a 
worthy goal, I, nevertheless, have been troubled that the resulting 
budgetary pressure could lead some agencies to initiate unplanned 
layoffs. I told the chairman I did not want our

[[Page H5911]]

efforts to help out one group of employees while making victims of 
another.
  Because he was willing to work with me on this matter, we have been 
able to reach a compromise that achieves what each of us wanted: 
Simply, accountability and job security. Reductions in force to pay 
expenses associated with the implementation of this act would be 
prohibited. Agencies would be required to realize any savings necessary 
to avoid RIFs through attrition and limitations on hiring.
  Mr. Speaker, I thank the chairman of our subcommittee for bringing 
this important bill before the committee. My thanks to all of my 
colleagues on the Subcommittee on Civil Service for their steadfast 
commitment to addressing the problems caused by retirement coverage 
errors, and for you unanimously supporting the bill at the 
subcommittee's markup.
  Finally, my thanks to our staff and that of the Office of Legislative 
Counsel for their tireless work in crafting H.R. 3249. All of their 
efforts were essential to what we have accomplished here today.
  H.R. 3249 is a lengthy and complex bill which has evolved a great 
deal since our drafting began last fall. The subcommittee's work in 
this regard has benefitted considerably from the input of the Office of 
Personnel Management, the Social Security Administration, and the 
staffs of several other congressional committees.

                              {time}  1715

  I very much appreciated all of their comments and suggestions.
  Mr. Speaker, I reserve the balance of my time.
  Mr. MICA. Mr. Speaker, I am pleased to yield 5 minutes to the 
distinguished gentlewoman from Maryland [Mrs. Morella], a leader in our 
Subcommittee on Civil Service.
  Mrs. MORELLA. Mr. Speaker, I thank the gentleman for yielding me the 
time.
  Mr. Speaker, I rise in very strong support of H.R. 3249. It is very 
important legislation to remedy retirement enrollment errors. I want to 
add my very strong thanks to the chairman, the gentleman from Florida 
[Mr. Mica] and to his staff for the enormous work that they have done 
on this legislation.
  I also want to thank the gentleman from Maryland [Mr. Cummings], the 
ranking member. I want to also thank the Committee on Government Reform 
and Oversight chair and ranking member, and also the Committee on Ways 
and Means.
  So my colleagues can see, this has been a very important bipartisan 
effort involving a number of committees but emanating from problems 
that Federal employees had and in the subcommittee markup.
  At the Subcommittee on Civil Service hearing last year, we heard some 
horror stories of those who were placed in the wrong retirement system. 
We cannot make up for the pain caused by these errors, but we can 
indeed prevent more errors from occurring and provide as fair a remedy 
as possible, which is what this legislation before us does.
  We must move forward quickly to remedy the errors of the past and to 
prevent future suffering, especially as more employees discover they 
are in the wrong system during the current retirement open season.
  Many, possibly thousands, of Federal employees who have been hired 
since the inception of FERS have been erroneously placed in CSRS. Many 
of them do not even know that they are in the wrong system, and serious 
financial consequences that await them if no legislation is enacted are 
going to be tremendous.
  Those who have discovered their retirement errors have been deprived 
of critically important retirement and tax benefits and they have been 
subjected to severe strain and they have incurred tremendous legal 
expenses.
  So, Mr. Speaker, the legislation before us truly makes whole those 
Federal employees who have already been corrected, many harmed really, 
such as one of my constituents, Barry Schrum. Under this bill, 
employees may choose to remain in the retirement system in which they 
were mistakenly placed or to be covered by the system in which they 
should have been placed. If an employee chooses FERS, this legislation 
makes them whole by making up lost earnings in their thrift savings 
plans in those accounts. I am pleased that this legislation will ensure 
that agencies are not unduly burdened by this legislation in making 
employees whole again.
  So again, I want to congratulate all involved, particularly the 
leadership that came from the chairman and the ranking member of the 
subcommittee and the staffs that have made it all possible. Very 
important legislation. I urge my colleagues to join me in supporting 
this legislation.
  Mr. CUMMINGS. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I also want to thank the gentlewoman from the District 
of Columbia [Ms. Norton] of our subcommittee and the gentleman from 
Tennessee [Mr. Forward] who worked very hard to make sure that this 
legislation was as good as it is.
  I also would like to reiterate the fact that we did work in a 
bipartisan way and it shows. This effort and the effort of our 
Subcommittee on Civil Service shows what good things can happen when we 
join hands and work together to lift up the lives of Americans and all 
people of the world.
  Mr. Speaker, I yield back the balance of my time.
  Mr. MICA. Mr. Speaker, I yield myself the balance of my time.
  Mr. Speaker, first I want to take a moment to also thank again the 
gentlewoman from Maryland (Mrs. Morella) for her leadership on this 
issue and several members of our subcommittee who are not with us this 
afternoon who also provided leadership, the gentleman from New Jersey 
(Mr. Pappas) and the gentleman from Texas (Mr. Sessions), who also 
supported and help craft this legislation.
  Mr. Speaker, as we conclude our debate here this afternoon and 
presentation, H.R. 3249 will bring long overdue relief to the thousands 
of victims who have been misclassified because of Federal agency 
errors. Many of these errors have festered for more than 10 years and 
the procedures for correction available under current law do more harm 
than good.
  These errors in current procedures have really had devastating 
effects on individuals in our Federal employ, both financially and 
emotionally. It is imperative that Congress act now. As time goes by, 
the cost of making employees' thrift savings accounts whole actually 
increases and the burden for the Federal Government increases. So does 
the human toll taken by these agency errors.
  H.R. 3249 is a fair bill. It provides each affected employee with a 
real choice. Employees may elect to change their retirement enrollment 
or employees may ratify the agency errors by choosing to remain in the 
system in which they are mistakenly enrolled.
  The make-whole relief that guarantees freedom of choice, even for 
those with low incomes, is adapted from an IRS review procedure. 
Surely, our Federal employees and retirees deserve no less than what 
the IRS has prescribed as a remedy for employees who are so aggrieved 
or abused in the private sector.
  Mr. Speaker, H.R. 3249 is supported by many organizations. It is 
supported by the Senior Executive Association, the National Federation 
of Federal Employees, the American Foreign Service Association, the 
National Association of Letter Carriers, the National Association of 
Postmasters of the United States, and the Federal Managers Association.
  All Members should join with the hundreds of thousands of employees 
of these organizations with our Federal employees and retirees and 
support this long overdue reform. I urge their support this afternoon 
for H.R. 3249.
  Mr. Speaker, I yield back the balance of my time.
  The SPEAKER pro tempore (Mr. Miller of Florida). The question is on 
the motion offered by the gentleman from Florida (Mr. Mica) that the 
House suspend the rules and pass the bill, H.R. 3249, as amended.
  The question was taken; and (two-thirds having voted in favor 
thereof) the rules were suspended and the bill, as amended, was agreed 
to.
  A motion to reconsider was laid on the table.

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