[Congressional Record (Bound Edition), Volume 145 (1999), Part 19]
[Senate]
[Pages 28176-28182]
[From the U.S. Government Publishing Office, www.gpo.gov]



         FEDERAL ERRONEOUS RETIREMENT COVERAGE CORRECTIONS ACT

  Mr. GRAMM. Mr. President, I ask unanimous consent that the Senate now 
proceed to the consideration of Calendar No. 309, S. 1232.
  The PRESIDING OFFICER. The clerk will report the bill by title.
  The legislative clerk read as follows:

       A bill (S. 1232) to provide for the correction of 
     retirement coverage errors under chapters 83 and 84 of title 
     5, United States Code.

  There being no objection, the Senate proceeded to consider the bill.


                           Amendment No. 2508

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

  Mr. GRAMM. Mr. President, Senators Cochran and Akaka have a 
substitute amendment at the desk, and I ask for its consideration.

[[Page 28177]]

  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Texas [Mr. Gramm] for Mr. Cochran, for 
     himself and Mr. Akaka, proposes an amendment numbered 2508.

  (The text of the amendment is printed in today's Record under 
``Amendments Submitted.'')
  Mr. GRAMM. Mr. President, I ask unanimous consent that the amendment 
be agreed to.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment (No. 2508) was agreed to.
  The PRESIDING OFFICER. Mr. President, I ask unanimous consent that 
the bill be read a third time and passed, as amended, the motion to 
reconsider be laid upon the table, and any statements relating to the 
bill be printed in the Record.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The bill (S. 1232), as amended, was read the third time and passed, 
as follows:

                                S. 1232

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

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

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

Sec. 1. Short title; table of contents.
Sec. 2. Definitions.
Sec. 3. Applicability.
Sec. 4. Irrevocability of elections.

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

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

Sec. 101. Employees.
Sec. 102. Annuitants and survivors.

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

Sec. 111. Applicability.
Sec. 112. Correction mandatory.

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

Sec. 121. Employee who should be Social Security-Only covered, but who 
              is erroneously CSRS or CSRS-Offset covered instead.

         Subtitle D--Employee Who Was Erroneously FERS Covered.

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

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

Sec. 141. Applicability.
Sec. 142. Correction mandatory.

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

Sec. 151. Applicability.
Sec. 152. Correction mandatory.

                      TITLE II--GENERAL PROVISIONS

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

                      TITLE III--OTHER PROVISIONS

Sec. 301. Provisions to authorize continued conformity of other Federal 
              retirement systems.
Sec. 302. Authorization of payments.
Sec. 303. Individual right of action preserved for amounts not 
              otherwise provided for under this Act.

                        TITLE IV--TAX PROVISIONS

Sec. 401. Tax provisions.

              TITLE V--MISCELLANEOUS RETIREMENT PROVISIONS

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

                        TITLE VI--EFFECTIVE DATE

Sec. 601. Effective date.

     SEC. 2. DEFINITIONS.

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

     SEC. 3. APPLICABILITY.

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

     SEC. 4. IRREVOCABILITY OF ELECTIONS.

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

[[Page 28178]]



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

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

     SEC. 101. EMPLOYEES.

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

     SEC. 102. ANNUITANTS AND SURVIVORS.

       (a) In General.--This section shall apply in the case of an 
     individual who is--
       (1) an annuitant who should have been FERS covered but, as 
     a result of a retirement coverage error, was CSRS covered or 
     CSRS-Offset covered instead; or
       (2) a survivor of an employee who should have been FERS 
     covered but, as a result of a retirement coverage error, was 
     CSRS covered or CSRS-Offset covered instead.
       (b) Coverage.--
       (1) Election.--Not later than 180 days after the date of 
     enactment of this Act, the Office shall prescribe regulations 
     authorizing an individual described under subsection (a) to 
     elect CSRS-Offset coverage or FERS coverage, effective as of 
     the date of the retirement coverage error.
       (2) Time limitation.--An election under this subsection 
     shall be made not later than 18 months after the effective 
     date of the regulations prescribed under paragraph (1).
       (3) Reduced annuity.--
       (A) Amount in account.--If the individual elects CSRS-
     Offset coverage, the amount in the employee's Thrift Savings 
     Fund account under subchapter III of chapter 84 of title 5, 
     United States Code, on the date of retirement that represents 
     the Government's contributions and earnings on those 
     contributions (whether or not such amount was subsequently 
     distributed from the Thrift Savings Fund) will form the basis 
     for a reduction in the individual's annuity, under 
     regulations prescribed by the Office.
       (B) Reduction.--The reduced annuity to which the individual 
     is entitled shall be equal to an amount which, when taken 
     together with the amount referred to in subparagraph (A), 
     would result in the present value of the total being 
     actuarially equivalent to the present value of an unreduced 
     CSRS-Offset annuity that would have been provided the 
     individual.
       (4) Reduced benefit.--If--
       (A) a surviving spouse elects CSRS-Offset benefits; and
       (B) a FERS basic employee death benefit under section 
     8442(b) of title 5, United States Code, was previously paid;

     then the survivor's CSRS-Offset benefit shall be subject to a 
     reduction, under regulations prescribed by the Office. The 
     reduced annuity to which the individual is entitled shall be 
     equal to an amount which, when taken together with the amount 
     of the payment referred to under subparagraph (B) would 
     result in the present value of the total being actuarially 
     equivalent to the present value of an unreduced CSRS-Offset 
     annuity that would have been provided the individual.
       (5) Previous settlement payment.--An individual who 
     previously received a payment ordered by a court or provided 
     as a settlement of claim for losses resulting from a 
     retirement coverage error may not make an election under this 
     subsection unless repayment of that amount is waived in whole 
     or in part under section 208, and any amount not waived is 
     repaid.
       (c) Nonelection.--If the individual does not make an 
     election under subsection (b) before any time limitation 
     under this section, the retirement coverage shall be subject 
     to the following rules:
       (1) Corrective action previously taken.--If corrective 
     action was taken before the end of any time limitation under 
     this section, that corrective action shall remain in effect.
       (2) Corrective action not previously taken.--If corrective 
     action was not taken before such time limitation, the 
     employee shall be CSRS-Offset covered, retroactive to the 
     date of the retirement coverage error.

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

     SEC. 111. APPLICABILITY.

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

     SEC. 112. CORRECTION MANDATORY.

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

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

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

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

[[Page 28179]]

       (1) Applicability.--This subsection applies if the 
     retirement coverage error was corrected before the effective 
     date of the regulations described under subsection (b)(3).
       (2) Election.--Not later than 180 days after the date of 
     enactment of this Act, the Office shall prescribe regulations 
     authorizing individuals to elect, during the 18-month period 
     immediately following the effective date of such regulations, 
     to be CSRS-Offset covered or Social Security-Only covered, 
     effective as of the date of the retirement coverage error.
       (3) Nonelection.--If an eligible individual does not make 
     an election under paragraph (2) before the end of any time 
     limitation under this subsection, the corrective action taken 
     before such time limitation shall remain in effect.

         Subtitle D--Employee Who Was Erroneously FERS Covered

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

       (a) Applicability.--This section applies in the case of a 
     retirement coverage error in which a Social Security-Only 
     covered, CSRS covered, or CSRS-Offset covered employee not 
     eligible to elect FERS coverage under authority of section 
     8402(c) of title 5, United States Code, was erroneously FERS 
     covered.
       (b) Uncorrected Error.--
       (1) Applicability.--This subsection applies if the 
     retirement coverage error has not been corrected before the 
     effective date of the regulations described in paragraph (2).
       (2) Coverage.--
       (A) Election.--
       (i) In general.--Upon written notice of a retirement 
     coverage error, an individual may elect to remain FERS 
     covered or to be Social Security-Only covered, CSRS covered, 
     or CSRS-Offset covered, as would have applied in the absence 
     of the erroneous retirement coverage determination, effective 
     as of the date of the retirement coverage error. Such 
     election shall be made not later than 180 days after the date 
     of receipt of such notice.
       (ii) Treatment of fers election.--An election of FERS 
     coverage under this subsection is deemed to be an election 
     under section 301 of the Federal Employees Retirement System 
     Act of 1986 (5 U.S.C. 8331 note; Public Law 99-335; 100 Stat. 
     599).
       (B) Nonelection.--If the individual does not make an 
     election before the date provided under subparagraph (A), the 
     individual shall remain FERS covered, effective as of the 
     date of the retirement coverage error.
       (3) Employee contributions in thrift savings fund.--If 
     under this section, an individual elects to be Social 
     Security-Only covered, CSRS covered, or CSRS-Offset covered, 
     all employee contributions to the Thrift Savings Fund made 
     during the period of erroneous FERS coverage (and all 
     earnings on such contributions) may remain in the Thrift 
     Savings Fund in accordance with regulations prescribed by the 
     Executive Director, notwithstanding any limit under section 
     8351 or 8432 of title 5, United States Code.
       (4) Regulations.--Except as provided under paragraph (3), 
     the Office shall prescribe regulations to carry out this 
     subsection.
       (c) Corrected Error.--
       (1) Applicability.--This subsection applies if the 
     retirement coverage error was corrected before the effective 
     date of the regulations described under paragraph (2).
       (2) Election.--Not later than 180 days after the date of 
     enactment of this Act, the Office shall prescribe regulations 
     authorizing individuals to elect, during the 18-month period 
     immediately following the effective date of such regulations 
     to remain Social Security-Only covered, CSRS covered, or 
     CSRS-Offset covered, or to be FERS covered, effective as of 
     the date of the retirement coverage error.
       (3) Nonelection.--If an eligible individual does not make 
     an election under paragraph (2), the corrective action taken 
     before the end of any time limitation under this subsection 
     shall remain in effect.
       (4) Treatment of fers election.--An election of FERS 
     coverage under this subsection is deemed to be an election 
     under section 301 of the Federal Employees Retirement System 
     Act of 1986 (5 U.S.C. 8331 note; Public Law 99-335; 100 Stat. 
     599).

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

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

     SEC. 133. RETROACTIVE EFFECT.

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

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

     SEC. 141. APPLICABILITY.

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

     SEC. 142. CORRECTION MANDATORY.

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

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

     SEC. 151. APPLICABILITY.

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

     SEC. 152. CORRECTION MANDATORY.

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

                      TITLE II--GENERAL PROVISIONS

     SEC. 201. IDENTIFICATION AND NOTIFICATION REQUIREMENTS.

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

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

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

     SEC. 203. SERVICE CREDIT DEPOSITS.

       (a) CSRS Deposit.--In the case of a retirement coverage 
     error in which--

[[Page 28180]]

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

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

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

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

       (a) Applicability.--This section applies to an individual 
     who--
       (1) is eligible to make an election of coverage under 
     section 101 or 102, and only if FERS coverage is elected (or 
     remains in effect) for the employee involved; or
       (2) is described in section 111, and makes or has made 
     retroactive employee contributions to the Thrift Savings Fund 
     under regulations prescribed by the Executive Director.
       (b) Payment Into Thrift Savings Fund.--
       (1) In general.--
       (A) Payment.--With respect to an individual to whom this 
     section applies, the employing agency shall pay to the Thrift 
     Savings Fund under subchapter III of chapter 84 of title 5, 
     United States Code, for credit to the account of the employee 
     involved, an amount equal to the earnings which are 
     disallowed under section 8432a(a)(2) of such title on the 
     employee's retroactive contributions to such Fund.
       (B) Amount.--Earnings under subparagraph (A) shall be 
     computed in accordance with the procedures for computing lost 
     earnings under section 8432a of title 5, United States Code. 
     The amount paid by the employing agency shall be treated for 
     all purposes as if that amount had actually been earned on 
     the basis of the employee' s contributions.
       (C) Exceptions.--If an individual made retroactive 
     contributions before the effective date of the regulations 
     under section 101(c), the Director may provide for an 
     alternative calculation of lost earnings to the extent that a 
     calculation under subparagraph (B) is not administratively 
     feasible. The alternative calculation shall yield an amount 
     that is as close as practicable to the amount computed under 
     subparagraph (B), taking into account earnings previously 
     paid.
       (2) Additional employee contribution.--In cases in which 
     the retirement coverage error was corrected before the 
     effective date of the regulations under section 101(c), the 
     employee involved shall have an additional opportunity to 
     make retroactive contributions for the period of the 
     retirement coverage error (subject to applicable limits), and 
     such contributions (including any contributions made after 
     the date of the correction) shall be treated in accordance 
     with paragraph (1).
       (c) Regulations.--
       (1) Executive Director.--The Executive Director shall 
     prescribe regulations appropriate to carry out this section 
     relating to retroactive employee contributions and payments 
     made on or after the effective date of the regulations under 
     section 101(c).
       (2) Office.--The Office, in consultation with the Federal 
     Retirement Thrift Investment Board, shall prescribe 
     regulations appropriate to carry out this section relating to 
     the calculation of lost earnings on retroactive employee 
     contributions made before the effective date of the 
     regulations under section 101(c).

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

       (a) Certain Excess Agency Contributions to Remain in the 
     CSRDF.--
       (1) In general.--Any amount described under paragraph (2) 
     shall--
       (A) remain in the CSRDF; and

[[Page 28181]]

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

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

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

     SEC. 208. DISCRETIONARY ACTIONS BY DIRECTOR.

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

      SEC. 209. REGULATIONS.

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

                      TITLE III--OTHER PROVISIONS

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

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

     SEC. 302. AUTHORIZATION OF PAYMENTS.

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

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

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

                        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--
       (1) any failure to follow plan terms as addressed by this 
     Act; or
       (2) any action taken under this Act.
       (b) Transfers.--For purposes of the Internal Revenue Code 
     of 1986, no amount shall be includible in the gross income of 
     any individual in any tax year by reason of any direct 
     transfer under this Act between funds or any Government 
     contribution under this Act to any fund or account in any 
     such tax year.

              TITLE V--MISCELLANEOUS RETIREMENT PROVISIONS

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

       (a) Creditable Service.--
       (1) In general.--Section 8411(b) of title 5, United States 
     Code, is amended--
       (A) by striking ``and'' at the end of paragraph (3);
       (B) in paragraph (4)--
       (i) by striking ``of the preceding provisions'' and 
     inserting ``other paragraph''; and
       (ii) by striking the period at the end and inserting ``; 
     and''; and
       (C) by adding at the end the following:
       ``(5) a period of service (other than any service under any 
     other paragraph of this subsection, any military service, and 
     any service performed in the employ of a Federal Reserve 
     Bank) that was creditable under the Bank plan (as defined in 
     subsection (i)), if the employee waives credit for such 
     service under the Bank plan and makes a payment to the Fund 
     equal to the amount that would have been deducted from pay 
     under section 8422(a) had the employee been subject to this 
     chapter during such period of service (together with interest 
     on such amount computed under paragraphs (2) and (3) of 
     section 8334(e)).

     Paragraph (5) shall not apply in the case of any employee as 
     to whom subsection (g) (or, to the extent subchapter III of 
     chapter 83 is involved, section 8332(n)) otherwise 
     applies.''.
       (2) Bank plan defined.--Section 8411 of title 5, United 
     States Code, is amended by adding at the end the following:
       ``(i) For purposes of subsection (b)(5), the term `Bank 
     plan' means the benefit structure--
       ``(1) in which employees of the Board of Governors of the 
     Federal Reserve System appointed on or after January 1, 1984, 
     participate; and
       ``(2) that is a component of the Retirement Plan for 
     Employees of the Federal Reserve System, established under 
     section 10 of the Federal Reserve Act (and any redesignated 
     or successor version of such benefit structure, if so 
     identified in writing by the Board of Governors of the 
     Federal Reserve System for purposes of this chapter).''.
       (b) Exclusion From Chapter 84.--
       (1) In general.--Paragraph (2) of section 8402(b) of title 
     5, United States Code, is amended by striking the matter 
     before subparagraph (B) and inserting the following:
       ``(2)(A) any employee or Member who has separated from the 
     service after--
       ``(i) having been subject to--
       ``(I) subchapter III of chapter 83 of this title;
       ``(II) subchapter I of chapter 8 of title I of the Foreign 
     Service Act of 1980 (22 U.S.C. 4041 et seq.); or
       ``(III) the benefit structure for employees of the Board of 
     Governors of the Federal Reserve System appointed before 
     January 1, 1984, that is a component of the Retirement Plan 
     for Employees of the Federal Reserve System, established 
     under section 10 of the Federal Reserve Act; and
       ``(ii) having completed--
       ``(I) at least 5 years of civilian service creditable under 
     subchapter III of chapter 83 of this title;
       ``(II) at least 5 years of civilian service creditable 
     under subchapter I of chapter 8 of title I of the Foreign 
     Service Act of 1980 (22 U.S.C. 4041 et seq.); or
       ``(III) at least 5 years of civilian service (other than 
     any service performed in the employ of a Federal Reserve 
     Bank) creditable under the benefit structure for employees of 
     the Board of Governors of the Federal Reserve System 
     appointed before January 1, 1984, that is a component of the 
     Retirement Plan for Employees of the Federal Reserve System, 
     established under section 10 of the Federal Reserve Act,

     determined without regard to any deposit or redeposit 
     requirement under either such subchapter or under such 
     benefit structure, or any requirement that the individual 
     become

[[Page 28182]]

     subject to either such subchapter or to such benefit 
     structure after performing the service involved; or''.
       (2) Exception.--Subsection (d) of section 8402 of title 5, 
     United States Code, is amended to read as follows:
       ``(d) Paragraph (2) of subsection (b) shall not apply to an 
     individual who--
       ``(1) becomes subject to--
       ``(A) subchapter II of chapter 8 of title I of the Foreign 
     Service Act of 1980 (22 U.S.C. 4071 et seq.) (relating to the 
     Foreign Service Pension System) pursuant to an election; or
       ``(B) the benefit structure in which employees of the Board 
     of Governors of the Federal Reserve System appointed on or 
     after January 1, 1984, participate, which benefit structure 
     is a component of the Retirement Plan for Employees of the 
     Federal Reserve System, established under section 10 of the 
     Federal Reserve Act (and any redesignated or successor 
     version of such benefit structure, if so identified in 
     writing by the Board of Governors of the Federal Reserve 
     System for purposes of this chapter); and
       ``(2) subsequently enters a position in which, but for 
     paragraph (2) of subsection (b), such individual would be 
     subject to this chapter.''.
       (c) Provisions Relating to Certain Former Employees.--A 
     former employee of the Board of Governors of the Federal 
     Reserve System who--
       (1) has at least 5 years of civilian service (other than 
     any service performed in the employ of a Federal Reserve 
     Bank) creditable under the benefit structure for employees of 
     the Board of Governors of the Federal Reserve System 
     appointed before January 1, 1984, that is a component of the 
     Retirement Plan for Employees of the Federal Reserve System, 
     established under section 10 of the Federal Reserve Act;
       (2) was subsequently employed subject to the benefit 
     structure in which employees of the Board of Governors of the 
     Federal Reserve System appointed on or after January 1, 1984, 
     participate, which benefit structure is a component of the 
     Retirement Plan for Employees of the Federal Reserve System, 
     established under section 10 of the Federal Reserve Act (and 
     any redesignated or successor version of such benefit 
     structure, if so identified in writing by the Board of 
     Governors of the Federal Reserve System for purposes of 
     chapter 84 of title 5, United States Code); and
       (3) after service described in paragraph (2), becomes 
     subject to and thereafter entitled to benefits under chapter 
     84 of title 5, United States Code,

     shall, for purposes of section 302 of the Federal Employees' 
     Retirement System Act of 1986 (5 U.S.C. 8331 note; Public Law 
     99-335; 100 Stat. 601) be considered to have become subject 
     to chapter 84 of title 5, United States Code, pursuant to an 
     election under section 301 of such Act.
       (d) Effective Date.--
       (1) In general.--Subject to paragraphs (2) and (3), this 
     section and the amendments made by this section shall take 
     effect on the date of enactment of this Act.
       (2) Provisions relating to creditability and certain former 
     employees.--The amendments made by subsection (a) and the 
     provisions of subsection (c) shall apply only to individuals 
     who separate from service subject to chapter 84 of title 5, 
     United States Code, on or after the date of enactment of this 
     Act.
       (3) Provisions relating to exclusion from chapter.--The 
     amendments made by subsection (b) shall not apply to any 
     former employee of the Board of Governors of the Federal 
     Reserve System who, subsequent to his or her last period of 
     service as an employee of the Board of Governors of the 
     Federal Reserve System and prior to the date of enactment of 
     this Act, became subject to subchapter III of chapter 83 or 
     chapter 84 of title 5, United States Code, under the law in 
     effect at the time of the individual's appointment.

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

       (a) Amendments to Chapter 84 of Title 5, United States 
     Code.--
       (1) In general.--Subchapter III of chapter 84 of title 5, 
     United States Code, is amended by inserting before section 
     8432 the following:

     ``Sec. 8431. Certain transfers to be treated as a separation

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

``8431. Certain transfers to be treated as a separation.''.

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

                        TITLE VI--EFFECTIVE DATE

     SEC. 601. EFFECTIVE DATE.

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

                          ____________________