[House Report 114-823]
[From the U.S. Government Publishing Office]


114th Congress    }                                    {        Report
                        HOUSE OF REPRESENTATIVES
 2d Session       }                                    {       114-823

======================================================================



 
 TO AMEND TITLE 5, UNITED STATES CODE, TO PROVIDE FOR RECALCULATION OF 
  BASIC ANNUITY BENEFITS FOR CERTAIN AIR TRAFFIC CONTROLLERS, AND FOR 
                             OTHER PURPOSES

                                _______
                                

 November 14, 2016.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                                _______
                                

 Mr. Chaffetz, from the Committee on Oversight and Government Reform, 
                        submitted the following

                              R E P O R T

                        [To accompany H.R. 5341]

    The Committee on Oversight and Government Reform, to whom 
was referred the bill (H.R. 5341) to amend title 5, United 
States Code, to provide for recalculation of basic annuity 
benefits for certain air traffic controllers, and for other 
purposes, having considered the same, report favorably thereon 
without amendment and recommend that the bill do pass.

                                CONTENTS

                                                                   Page
Committee Statement and Views....................................     2
Section-by-Section...............................................     4
Explanation of Amendments........................................     4
Committee Consideration..........................................     4
Roll Call Votes..................................................     4
Application of Law to the Legislative Branch.....................     4
Statement of Oversight Findings and Recommendations of the 
  Committee......................................................     4
Statement of General Performance Goals and Objectives............     4
Duplication of Federal Programs..................................     5
Disclosure of Directed Rule Makings..............................     5
Federal Advisory Committee Act...................................     5
Unfunded Mandate Statement.......................................     5
Earmark Identification...........................................     5
Committee Estimate...............................................     5
Budget Authority and Congressional Budget Office Cost Estimate...     6
Changes in Existing Law Made by the Bill, as Reported............     6

                     Committee Statement and Views


                          PURPOSE AND SUMMARY

    H.R. 5341 clarifies the basis for calculating retirement 
benefits for Federal Aviation Administration (FAA) air traffic 
controllers (ATCs) and certain supervisors of air traffic 
controllers.

                  BACKGROUND AND NEED FOR LEGISLATION

    FAA air traffic controllers and their managers help ensure 
the safety of millions of travelers who fly through our 
nation's airspace each day. In 2003, the Vision 100--Century of 
Aviation Reauthorization Act (Public Law 108-176) was enacted, 
allowing certain FAA air traffic controllers to receive an 
enhanced Federal Employees Retirement System (FERS) annuity 
accrual benefit of 1.7 percent per year in lieu of the standard 
one percent rate for most federal employees.\1\
---------------------------------------------------------------------------
    \1\Section 226, P.L. 108-176.
---------------------------------------------------------------------------
    The October 2003 Conference Report for Vision 100 indicates 
that the intent of the sponsors was to provide enhanced 
retirement benefits to first and second line supervisors as 
well as front line air traffic controllers:

          [C]ontrollers who were promoted to first line 
        supervisors as well as the supervisors of those first 
        line supervisors would continue to accrue the 
        retirement benefits of controllers.\2\
---------------------------------------------------------------------------
    \2\Committee on Conference, Vision 100--Century of Aviation 
Reauthorization Act, 108th Cong. (Oct. 29, 2003) (H. Rept. 108-334).

    Section 226 of Vision 100 provides enhanced retirement 
benefits to ATCs who are ``actively engaged in the separation 
and control of air traffic'' as defined in 5 U.S.C. 
2109(1)(A)(i).\3\ Consistent with congressional intent, the FAA 
interpreted this section to include front-line air traffic 
controllers and also some first and second-level supervisory 
air traffic controller positions if, by the nature of their 
duties, they are required to be ``actively engaged in the 
separation and control of air traffic.'' In November 2015, the 
FAA notified the Office of Personnel Management (OPM) that it 
certified the service of these individuals, including first and 
second-level managers, as service qualifying for enhanced 
annuities under section 226.\4\
---------------------------------------------------------------------------
    \3\Pub. L. No. 108-176 (2003).
    \4\Letter from Annie B. Andrews, Assistant Administrator for Human 
Resource Management at FAA, to Kenneth J. Zawodny Jr., Associate 
Director, Retirement Services at OPM (November 20, 2015).
---------------------------------------------------------------------------
    In response to the FAA's notification, OPM informed the FAA 
in March 2016 that its certification of service for air traffic 
controllers was not in accordance with section 226 of P.L. 108-
176 or OPM's guidance on the matter.\5\ In prior guidance 
issued by OPM in 2006, the agency interpreted section 226 as 
applying only to the front-line air traffic controller 
positions and not to those individuals who occupy first or 
second level supervisory positions.\6\ OPM read distinctions 
between front-line air traffic control work and supervisory 
work as mutually exclusive under 5 U.S.C. Sec. 2109(1)(A) and 
(B).
---------------------------------------------------------------------------
    \5\Letter from Kenneth J. Zawodny Jr., Associate Director, 
Retirement Services at OPM, to Annie B. Andrews, Assistant 
Administrator for Human Resource Management at FAA (February 8, 2016).
    \6\Id.
---------------------------------------------------------------------------
    OPM instructed the FAA to review the records of affected 
individuals whose service may have been erroneously certified 
and provide corrected records to OPM.\7\ According to OPM's 
interpretation of section 226, approximately 185 annuitants who 
already retired from the FAA with supervisory air traffic 
controller service should have been credited at the standard 
rate of one percent instead of the enhanced rate of 1.7 
percent.\8\ According to the Congressional Budget Office (CBO), 
OPM has stated that they intend to seek recovery of any 
overpayments these 185 annuitants have received.\9\
---------------------------------------------------------------------------
    \7\Id.
    \8\Congressional Budget Office Cost Estimate, S. 2658, Federal 
Aviation Administration Reauthorization Act of 2016 (April 7, 2016).
    \9\Id.
---------------------------------------------------------------------------
    H.R. 5341 makes a technical amendment to the United States 
Code to clarify the original congressional intent that air 
traffic controllers as defined in 5 U.S.C. Sec. 2109(1)(A)(i), 
front line air traffic managers as defined in 5 U.S.C. 
Sec. 2109(1)(B), and supervisors as defined in 5 U.S.C. 
Sec. 8401(35)(B) are entitled to receive the enhanced annuity 
at 1.7 percent. Moreover, the legislation ensures that the 185 
FAA annuitants who have already retired under provisions of 
P.L. 108-176 continue to receive an annuity calculated at the 
1.7 percent rate.
    This bill also helps the FAA retain experienced air traffic 
controllers and managers. According to the Department of 
Transportation Inspector General, the United States has one of 
the safest air traffic systems in the world, but maintaining 
the excellent safety record depends on having a fully staffed 
and well-trained controller workforce.\10\ Since the FAA began 
implementing the enhanced annuity benefit after the enactment 
of P.L. 108-176, the enhanced annuity has been an effective 
tool to encourage air traffic controller managers to remain in 
management positions and retain key experience. H.R. 5341's 
technical fix helps the FAA maintain this important retention 
tool to encourage seasoned managers to stay at the FAA and help 
ensure the safety of our nation's airspace.
---------------------------------------------------------------------------
    \10\Dep't of Transportation Inspect Gen., FAA Continues to Face 
Challenges in Ensuring Enough Fully Trained Controllers at Critical 
Facilities (Jan. 11, 2016) (AV-2016-104).
---------------------------------------------------------------------------
    H.R. 5341 clarifies congressional intent of P.L. 108-176, 
and does not expand the scope originally intended.\11\ For 
example, management time in positions providing ``preflight, 
inflight, or airport advisory service to aircraft operators'' 
contained in 5 U.S.C. Sec. 2109(A)(ii) are not eligible for the 
enhanced annuity calculation at the 1.7 percent rate.
---------------------------------------------------------------------------
    \11\H. Rept. 108-334, Conference Report on H.R. 2115 (October 29, 
2003) at 159-160.
---------------------------------------------------------------------------

                          LEGISLATIVE HISTORY

    H.R. 5341, to amend title 5, United States Code, to provide 
for recalculation of basic annuity benefits for certain air 
traffic controllers, was introduced on May 26, 2016, by 
Representative John Mica (R-FL) and referred to the Committee 
on Oversight and Government Reform. On July 12, 2016, the 
Committee on Oversight and Government Reform ordered H.R. 5341 
favorably reported by voice vote, without amendment.

                           Section-by-Section


Section 1. Computation of basic annuity for certain air traffic 
        controllers

    Subsection (a) amends section 8415(f) of title 5, United 
States Code, to clarify that current or former air traffic 
controllers with at least five years of service in any 
combination of air traffic controller, and first and second 
level supervisors of an air traffic controller, will receive an 
annuity calculated at the 1.7 percent rate of the individual's 
average pay by the years of service.
    Subsection (b) makes the effective date of subsection (a) 
December 12, 2003.
    Subsection (c) requires that the Office of Personnel 
Management establish procedures to notify annuitants affected 
by this bill, recalculate benefits of affected annuitants, 
adjust monthly annuity benefits as soon as practicable, and 
provide any applicable lump sum payments to affected 
annuitants.

                       Explanation of Amendments

    No amendments to H.R. 5341 were offered or adopted during 
Full Committee consideration of the bill.

                        Committee Consideration

    On July 12, 2016 the Committee met in open session and 
ordered reported favorably the bill, H.R. 5341, by voice vote, 
a quorum being present.

                            Roll Call Votes

    No roll call votes were requested or conducted during Full 
Committee consideration of H.R. 5341.

              Application of Law to the Legislative Branch

    Section 102(b)(3) of Public Law 104-1 requires a 
description of the application of this bill to the legislative 
branch where the bill relates to the terms and conditions of 
employment or access to public services and accommodations. 
This bill clarifies congressional intent regarding air traffic 
controller retirement accrual. As such this bill does not 
relate to employment or access to public services and 
accommodations.

  Statement of Oversight Findings and Recommendations of the Committee

    In compliance with clause 3(c)(1) of rule XIII and clause 
(2)(b)(1) of rule X of the Rules of the House of 
Representatives, the Committee's oversight findings and 
recommendations are reflected in the descriptive portions of 
this report.

         Statement of General Performance Goals and Objectives

    In accordance with clause 3(c)(4) of rule XIII of the Rules 
of the House of Representatives, the Committee's performance 
goal and objective of the bill is to provide for recalculation 
of basic annuity benefits for certain air traffic controllers.

                    Duplication of Federal Programs

    No provision of this bill establishes or reauthorizes a 
program of the federal government known to be duplicative of 
another Federal program, a program that was included in any 
report from the Government Accountability Office to Congress 
pursuant to section 21 of Public Law 111-139, or a program 
related to a program identified in the most recent Catalog of 
Federal Domestic Assistance.

                  Disclosure of Directed Rule Makings

    The Committee estimates that enacting this bill does not 
direct the completion of any specific rule makings within the 
meaning of 5 U.S.C. 551.

                     Federal Advisory Committee Act

    The Committee finds that the legislation does not establish 
or authorize the establishment of an advisory committee within 
the definition of 5 U.S.C. App., Section 5(b).

                       Unfunded Mandate Statement

    Section 423 of the Congressional Budget and Impoundment 
Control Act (as amended by Section 101(a)(2) of the Unfunded 
Mandate Reform Act, P.L. 104-4) requires a statement as to 
whether the provisions of the reported include unfunded 
mandates. In compliance with this requirement the Committee has 
received a letter from the Congressional Budget Office included 
herein.

                         Earmark Identification

    This bill does not include any congressional earmarks, 
limited tax benefits, or limited tariff benefits as defined in 
clause 9 of rule XXI.

                           Committee Estimate

    Clause 3(d)(1) of rule XIII of the Rules of the House of 
Representatives requires an estimate and a comparison by the 
Committee of the costs that would be incurred in carrying out 
this bill. However, clause 3(d)(2)(B) of that rule provides 
that this requirement does not apply when the Committee has 
included in its report a timely submitted cost estimate of the 
bill prepared by the Director of the Congressional Budget 
Office under section 402 of the Congressional Budget Act of 
1974.
    Identical provisions to those contained within H.R. 5341 
were signed into law on July 15, 2016 (P.L. 114-190), which 
precludes the Congressional Budget Office from providing an 
official cost estimate for H.R. 5341 to the Committee. 
Regarding P.L. 114-190, relative to current law, CBO expects 
that the proposed change would increase benefits for some 
existing retirees and increase benefits (and delay retirement) 
for some future retirees, resulting in an overall net reduction 
in direct spending of $8 million over the 2017-2026 period.

     Budget Authority and Congressional Budget Office Cost Estimate

    With respect to the requirements of clause 3(c)(2) of rule 
XIII of the Rules of the House of Representatives and section 
308(a) of the Congressional Budget Act of 1974 and with respect 
to requirements of clause (3)(c)(3) of rule XIII of the Rules 
of the House of Representatives and section 402 of the 
Congressional Budget Act of 1974, the Committee has not 
received a cost estimate for this bill from the Director of 
Congressional Budget Office, and instead has included a 
committee estimate in the section prior to this one.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, and existing law in which no 
change is proposed is shown in roman):

                      TITLE 5, UNITED STATES CODE




           *       *       *       *       *       *       *
PART III--EMPLOYEES

           *       *       *       *       *       *       *


SUBPART G--INSURANCE AND ANNUITIES

           *       *       *       *       *       *       *


CHAPTER 84--FEDERAL EMPLOYEES' RETIREMENT SYSTEM

           *       *       *       *       *       *       *



SUBCHAPTER II--BASIC ANNUITY

           *       *       *       *       *       *       *



Sec. 8415. Computation of basic annuity

  (a) Except as otherwise provided in this section, the annuity 
of an employee retiring under this subchapter is 1 percent of 
that individual's average pay multiplied by such individual's 
total service.
  (b) The annuity of a Member, or former Member with title to a 
Member annuity, retiring under this subchapter is computed 
under subsection (a), except that if the individual has had at 
least 5 years of service as a Member or Congressional employee, 
or any combination thereof, so much of the annuity as is 
computed with respect to either such type of service (or a 
combination thereof), not exceeding a total of 20 years, shall 
be computed by multiplying 1 7/10 percent of the individual's 
average pay by the years of such service.
  (c) The annuity of a Congressional employee, or former 
Congressional employee, retiring under this subchapter is 
computed under subsection (a), except that if the individual 
has had at least 5 years of service as a Congressional employee 
or Member, or any combination thereof, so much of the annuity 
as is computed with respect to either such type of service (or 
a combination thereof), not exceeding a total of 20 years, 
shall be computed by multiplying 1 7/10 percent of the 
individual's average pay by the years of such service.
  (d) Notwithstanding any other provision of law, the annuity 
of an individual described in subsection (b) or (c) who is a 
revised annuity employee or a further revised annuity employee 
shall be computed in the same manner as in the case of an 
individual described in subsection (a).
  (e) The annuity of an employee retiring under subsection (d) 
or (e) of section 8412 or under subsection (a), (b), or (c) of 
section 8425 is--
          (1) 1 7/10 percent of that individual's average pay 
        multiplied by so much of such individual's total 
        service as does not exceed 20 years; plus
          (2) 1 percent of that individual's average pay 
        multiplied by so much of such individual's total 
        service as exceeds 20 years.
  [(f) The annuity of an air traffic controller or former air 
traffic controller retiring under section 8412(a) is computed 
under subsection (a), except that if the individual has had at 
least 5 years of service as an air traffic controller as 
defined by section 2109(1)(A)(i), so much of the annuity as is 
computed with respect to such type of service shall be computed 
by multiplying 1 7/10 percent of the individual's average pay 
by the years of such service.]
  (f) The annuity of an air traffic controller or former air 
traffic controller retiring under section 8412(a) is computed 
under subsection (a), except that if the individual has at 
least 5 years of service in any combination as--
          (1) an air traffic controller as defined by section 
        2109(1)(A)(i);
          (2) a first level supervisor of an air traffic 
        controller as defined by section 2109(1)(A)(i); or
          (3) a second level supervisor of an air traffic 
        controller as defined by section 2109(1)(A)(i);
so much of the annuity as is computed with respect to such type 
of service shall be computed by multiplying 1\7/10\ percent of 
the individual's average pay by the years of such service.
  (g)(1) In computing an annuity under this subchapter for an 
employee whose service includes service performed on a part-
time basis--
          (A) the average pay of the employee, to the extent 
        that it includes pay for service performed in any 
        position on a part-time basis, shall be determined by 
        using the annual rate of basic pay that would be 
        payable for full-time service in the position; and
          (B) the benefit so computed shall then be multiplied 
        by a fraction equal to the ratio which the employee's 
        actual service, as determined by prorating the 
        employee's total service to reflect the service that 
        was performed on a part-time basis, bears to the total 
        service that would be creditable for the employee if 
        all of the service had been performed on a full-time 
        basis.
  (2) For the purpose of this subsection, employment on a part-
time basis shall not be considered to include employment on a 
temporary or intermittent basis.
  (h)(1) The annuity of an employee or Member retiring under 
section 8412(g) or 8413(b) is computed in accordance with 
applicable provisions of this section, except that the annuity 
shall be reduced by five-twelfths of 1 percent for each full 
month by which the commencement date of the annuity precedes 
the sixty-second anniversary of the birth of the employee or 
Member.
  (2)(A) Paragraph (1) does not apply in the case of an 
employee or Member retiring under section 8412(g) or 8413(b) if 
the employee or Member would satisfy the age and service 
requirements for title to an annuity under section 8412(a), 
(b), (d)(2), (e)(2), or (f)(2), determined as if the employee 
or Member had, as of the date of separation, attained the age 
specified in subparagraph (B).
  (B) A determination under subparagraph (A) shall be based on 
how old the employee or Member will be as of the date on which 
the annuity under section 8412(g) or 8413(b) is to commence.
  (i)(1) In applying subsection (a) with respect to an employee 
under paragraph (2), the percentage applied under such 
subsection shall be 1.1 percent, rather than 1 percent.
  (2) This subsection applies in the case of an employee who--
          (A) retires entitled to an annuity under section 
        8412; and
          (B) at the time of the separation on which 
        entitlement to the annuity is based, is at least 62 
        years of age and has completed at least 20 years of 
        service;
but does not apply in the case of a Congressional employee, 
military technician (dual status), law enforcement officer, 
member of the Supreme Court Police, firefighter, nuclear 
materials courier, air traffic controller, or customs and 
border protection officer
  (j) The annuity of a Member who has served in a position in 
the executive branch for which the rate of basic pay was 
reduced for the duration of the service of the Member in that 
position to remove the impediment to the appointment of the 
Member imposed by article I, section 6, clause 2 of the 
Constitution, shall, subject to a deposit in the Fund as 
provided under section 8422(g), be computed as though the rate 
of basic pay which would otherwise have been in effect during 
that period of service had been in effect.
  (k)(1) For purposes of this subsection, the term ``physicians 
comparability allowance'' refers to an amount described in 
section 8331(3)(H).
  (2) Except as otherwise provided in this subsection, no part 
of a physicians comparability allowance shall be treated as 
basic pay for purposes of any computation under this section 
unless, before the date of the separation on which entitlement 
to annuity is based, the separating individual has completed at 
least 15 years of service as a Government physician (whether 
performed before, on, or after the date of the enactment of 
this subsection).
  (3) If the condition under paragraph (2) is met, then, any 
amounts received by the individual in the form of a physicians 
comparability allowance shall (for the purposes referred to in 
paragraph (2)) be treated as basic pay, but only to the extent 
that such amounts are attributable to service performed on or 
after the date of the enactment of this subsection, and only to 
the extent of the percentage allowable, which shall be 
determined as follows:


 
------------------------------------------------------------------------
   If the total amount of service
 performed, on or after the date of     Then, the percent-age allowable
the enactment of this subsection, as                  is:
     a Government physician is:
------------------------------------------------------------------------
Less than 2 years                     0
At least 2 but less than 4 years      25
At least 4 but less than 6 years      50
At least 6 but less than 8 years      75
At least 8 years                      100.
------------------------------------------------------------------------

  (4) Notwithstanding any other provision of this subsection, 
100 percent of all amounts received as a physicians 
comparability allowance shall, to the extent attributable to 
service performed on or after the date of the enactment of this 
subsection, be treated as basic pay (without regard to any of 
the preceding provisions of this subsection) for purposes of 
computing--
          (A) an annuity under section 8452; and
          (B) a survivor annuity under subchapter IV, if based 
        on the service of an individual who dies before 
        separating from service.
  (l) The annuity of an employee retiring under this chapter 
with service credited under section 8411(b)(6) shall be reduced 
by the amount necessary to ensure that the present value of the 
annuity payable to the employee under this subchapter is 
actuarially equivalent to the present value of the annuity that 
would be payable to the employee under this subchapter if it 
were computed--
          (1) on the basis of service that does not include 
        service credited under section 8411(b)(6); and
          (2) assuming the employee separated from service on 
        the actual date of the separation of the employee.
The amount of the reduction shall be computed under regulations 
prescribed by the Office of Personnel Management for the 
administration of this subsection.
  (m)(1) In computing an annuity under this subchapter, the 
total service of an employee who retires from the position of a 
registered nurse with the Veterans Health Administration on an 
immediate annuity, or dies while employed in that position 
leaving any survivor entitled to an annuity, includes the days 
of unused sick leave to the credit of that employee under a 
formal leave system, except that such days shall not be counted 
in determining average pay or annuity eligibility under this 
subchapter.
  (2)(A) Except as provided in paragraph (1), in computing an 
annuity under this subchapter, the total service of an employee 
who retires on an immediate annuity or who dies leaving a 
survivor or survivors entitled to annuity includes the 
applicable percentage of the days of unused sick leave to his 
credit under a formal leave system and for which days the 
employee has not received payment, except that these days will 
not be counted in determining average pay or annuity 
eligibility under this subchapter. For purposes of this 
subsection, in the case of any such employee who is excepted 
from subchapter I of chapter 63 under section 6301(2)(x) 
through (xiii), the days of unused sick leave to his credit 
include any unused sick leave standing to his credit when he 
was excepted from such subchapter.
  (B) For purposes of subparagraph (A), the term ``applicable 
percentage'' means--
          (i) 50 percent in the case of an annuity, entitlement 
        to which is based on a death or other separation 
        occurring during the period beginning on the date of 
        enactment of this paragraph and ending on December 31, 
        2013; and
          (ii) 100 percent in the case of an annuity, 
        entitlement to which is based on a death or other 
        separation occurring after December 31, 2013.
  (n) In the case of any annuity computation under this section 
that includes, in the aggregate, at least 2 months of credit 
under section 8411(d) for any period while receiving benefits 
under subchapter I of chapter 81, the percentage otherwise 
applicable under this section for that period so credited shall 
be increased by 1 percentage point.

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