[Federal Register Volume 63, Number 117 (Thursday, June 18, 1998)]
[Rules and Regulations]
[Pages 33231-33235]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-16264]



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  Federal Register / Vol. 63, No. 117 / Thursday, June 18, 1998 / Rules 
and Regulations  

[[Page 33231]]


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OFFICE OF PERSONNEL MANAGEMENT

5 CFR Part 846

RIN 3206-AG96


Federal Employees Retirement System--Open Enrollment Act 
Implementation

AGENCY: Office of Personnel Management.

ACTION: Interim rule with request for comments.

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SUMMARY: The Office of Personnel Management (OPM) is issuing interim 
regulations to implement the Federal Employees Retirement System Open 
Enrollment Act of 1997. These regulations provide information about who 
may make open-enrollment-period elections and the procedures that 
employees must follow to elect Federal Employees Retirement System 
(FERS) coverage during the 1998 open enrollment period, and that 
agencies must follow in advising employees about such elections of FERS 
coverage and in processing such elections of FERS coverage.

DATES: Interim rules effective: June 18, 1998; comments must be 
received on or before August 17, 1998.

ADDRESSES: Send comments to Mary Ellen Wilson, Retirement Policy 
Division; Retirement and Insurance Service; Office of Personnel 
Management; P.O. Box 57; Washington, DC 20044; or deliver to OPM, Room 
4351, 1900 E Street NW., Washington, DC.

FOR FURTHER INFORMATION CONTACT: Harold L. Siegelman, (202) 606-0299.

SUPPLEMENTARY INFORMATION: Section 642 of the Treasury and General 
Government Appropriations Act, 1998, Pub. L. 105-61, approved October 
10, 1997, as amended by section 348 of the Department of Transportation 
and Related Agencies Appropriations Act, 1998, Pub. L. 105-66, approved 
October 27, 1997, is entitled the Federal Employees Retirement System 
(FERS) Open Enrollment Act of 1997. It requires OPM to issue 
regulations under which individuals who are employed by the Federal 
Government and covered by the Civil Service Retirement System (CSRS) as 
of January 1, 1998, may elect to become covered by FERS.
    Subsection (c) of section 642 prescribes certain requirements for 
the regulations. Elections must be made during the period beginning on 
July 1, 1998, and ending on December 31, 1998. OPM must provide for 
notice of the right to make the election including information on a 
comparison of the benefits an individual would receive under CSRS or 
FERS. Treatment of such an election must be ``similar to the applicable 
provisions of title III of the Federal Employees Retirement System Act 
of 1986 (Public Law 99-335; 100 Stat. 599 et seq.).''
    These regulations implement the FERS Open Enrollment Act of 1997 by 
clarifying who is eligible to make an election under the Act and by 
establishing the procedures for making such an election. They assign to 
employing agencies the obligation to provide statutorily-required 
notice and, if requested, additional information, including a 
comparison of benefits, to employees about their election rights. How 
the employing agencies provide that notice is generally up to them. In 
addition, the regulations provide for belated elections as a safety 
valve for instances in which the agency fails to provide the 
statutorily-required notice. If an agency denies a request to make a 
belated election, the agency is responsible for defending the denial, 
including the adequacy of its notice, before the Merit Systems 
Protection Board (MSPB).
    Generally, an election of FERS coverage is effective on the first 
day of the pay period beginning after the date the election (and, in 
cases affected by the former spouse consent requirement, the required 
supporting documentation) is received by the employing office. This is 
required under section 301(c) of the FERS Act and is reflected in 
section 846.703 of these regulations. The regulation also provides that 
an election cannot be effective before the beginning of the open 
enrollment period on July 1, 1998. For employees whose pay period is 
monthly and thus begins on July 1, the election is effective on August 
1, the first day of the next pay period.
    An election to be covered by FERS can be revoked anytime before it 
has become effective. Thus, an employee who submits an election to be 
covered by FERS prior to July 1, 1998, may revoke an election anytime 
before the beginning of the first pay period beginning after July 1, 
1998.
    An employee who does not want to elect FERS coverage does not need 
to file a completed election form. Although the SF 3109 does provide a 
space for an affirmative election not to be covered by FERS, such an 
election has no legal effect. To emphasize this, the regulations 
specifically provide that an election not to become covered by FERS may 
be revoked at any time during the open enrollment period by filing a 
new election. Agencies have no obligation to maintain records of 
elections not to become covered by FERS.
    The Act provides that an individual must have been employed by the 
Federal Government on January 1, 1998, to be eligible to make an open-
enrollment election. Because this statutory language is similar to the 
language concerning who was eligible to participate in the 1987 open 
enrollment period, we have interpreted the phrase ``employed by the 
Federal Government'' to have the same meaning as it was given in the 
1987 open enrollment period. Thus, anyone who (1) qualifies as an 
employee under section 2105 of title 5, United States Code, (2) is 
eligible for social security coverage, and (3) is not excluded from 
FERS coverage may be eligible to make an election as provided in 
section 846.711 of these regulations. This includes employees serving 
under appointments generally excluded from CSRS coverage but not 
excluded from FERS coverage, such as term appointments, as well as some 
individuals who are treated as Federal employees for retirement 
purposes, such as certain employees of the District of Columbia Courts. 
It also includes employees serving under appointments generally 
excluded under CSRS but who have CSRS coverage under section 
831.201(b)(1) of Title 5, Code of Federal Regulations. Section 
831.201(b)(1) provides that an employee serving in a position covered 
by CSRS (other than an alien whose duty station is in a foreign

[[Page 33232]]

country) retains CSRS coverage upon moving to employment in a position 
in an excluded category if the move occurs without a break in service 
(or after a separation of 3 days or less).
    By statute, four groups of individuals who may be covered by CSRS 
are not eligible to participate in the open enrollment opportunity. 
These statutory exclusions are reflected in 846.712 and 846.713. 
Section 846.712(a) excludes individuals employed by the government of 
the District of Columbia except for certain groups of employees who are 
permitted to be covered by FERS because by statute they are treated as 
Federal employees for retirement purposes. The National Capital 
Revitalization and Self-Government Improvement Act of 1997, title XI of 
Public Law 105-33, 111 Stat. 251, allows FERS coverage for non-judicial 
employees of the District of Columbia Courts and certain employees of 
the District of Columbia Department of Corrections Trustee or the 
District of Columbia Pretrial Services, Defense Services, Parole, Adult 
Probation and Offender Supervision Trustee who meet the requirements of 
section 831.201(g) of Title 5, Code of Federal Regulations. The 
District of Columbia Financial Responsibility and Management Assistance 
Act of 1995, Public Law 104-8, 109 Stat. 97, as amended, allows FERS 
coverage for employees of the District of Columbia Financial 
Responsibility and Management Assistance Authority who may make an 
election under section 831.204 of Title 5, Code of Federal Regulations.
    Section 846.712(b) excludes Members of Congress. Members were 
eligible to participate in the 1987 open enrollment period; however, 
section 348 of the Department of Transportation and Related Agencies 
Appropriations Act, 1998, Pub. L. 105-66, approved October 27, 1997, 
expressly excludes Members of Congress from the class of individuals 
who can make an open-enrollment election.
    Section 846.712(c) excludes individuals who are ineligible for 
social security coverage. The definition of ``employee'' for FERS in 
section 8401(11) of title 5, United States Code, permits only 
individuals who are eligible for social security coverage to elect FERS 
coverage.
    Section 846.713 excludes individuals who are subject to the former 
spouse consent requirement under section 301(d) of the FERS Act unless 
they obtain the former spouse's consent or qualify for a waiver of the 
consent requirement. The methods of proving consent or qualifying for a 
waiver are discussed in connection with section 846.722, infra.
    Section 846.721 establishes the actions that an eligible individual 
must take to elect FERS coverage. Elections must be documented by a 
completed SF 3109, the FERS Election of Coverage form, filed with the 
employing office. However, any signed writing timely filed with the 
employing office may be used as an election to establish the date of 
the election, and thus the effective date of FERS coverage, as long as 
the employing agency subsequently receives a completed SF 3109 to 
confirm such election. For example, if an employee on leave without pay 
or whose duty station is at a remote worksite, informs the agency by 
letter that he or she elects FERS coverage, the letter constitutes a 
valid election when confirmed with a completed SF 3109. The agency 
should have the employee complete an SF 3109 and should process the 
transfer of coverage effective at the beginning of the pay period after 
it received the letter.
    Generally, the right to elect FERS may only be exercised personally 
by the employee. Section 846.721(b) provides the only exception. It 
allows the survivor of a deceased employee to sign and file the 
completed SF 3109 on behalf of a deceased employee as long as the 
employee had made an election, as described in section 846.721(b).
    Section 301(d) of the FERS Act prohibits an election by an employee 
whose former spouse has filed with OPM certain court orders affecting 
the employee's retirement benefits. This restriction applied to 
elections during the 1987 open enrollment period and currently applies 
to all elections upon reemployment. We believe it would be consistent 
to apply such a restriction to elections during this open enrollment 
period. Accordingly, section 846.722 provides that the existing 
procedures applicable to the former spouse consent requirement 
generally apply to elections during the open enrollment period. In 
addition, the regulations provide for automatic approval of an 
extension of the time limit for election of FERS coverage until June 
30, 1999, upon filing (before January 1, 1999) with the agency of a 
properly completed SF 3111, Request for Waiver, Extension or Search, 
requesting an extension.
    Section 846.723 implements the requirement in section 642(c)(2) of 
the Act that OPM issue regulations to provide ``notice and information 
to individuals who may make such an election, including information on 
a comparison of benefits an individual would receive from coverage 
under [CSRS] or [FERS].'' Since comparisons of benefits are always 
unique to an individual employee, notice will be more effective if made 
by employing agencies directly. Accordingly, the regulations delegate 
to employing agencies responsibility to provide the required notice and 
information. Agencies may determine the exact form of the notice. See 
discussion of section 846.724(a) on belated elections and agency 
responsibility for defending the adequacy of its notice in any case in 
which it denies a request to make a belated election.
    Unlike the 1987 open season, we are not requiring that agencies 
distribute paper copies of the FERS Transfer Handbook to each employee, 
but each eligible employee who does not receive a paper copy must have 
ready access to the Handbook. The Handbook is accessible on the OPM 
website at www.opm.gov/fers__election. The Handbook also will be 
distributed to agencies on a CD-ROM that mirrors the website.
    The Handbook will be the primary tool employees will use in making 
their decisions. For most employees, reading the comparison of benefit 
provisions under the two systems and some of the scenarios contained in 
the Handbook will provide the information they need to make a decision.
    A transfer model is available on the FERS Election Opportunities 
page (www.opm.gov/fers__election) of OPM's website and will be on the 
CD-ROM. This is a computer model that will allow employees to estimate 
their projected benefits under CSRS and FERS based on assumptions 
unique to each employee. As with the Handbook, it should be made 
available for use by all eligible employees. The revised computer model 
is a user-friendly, interactive, Windows-based version that 
employees are able to use themselves to compare and contrast benefits 
under both systems. If the employing office cannot make the transfer 
model available to some employees, the agency is expected to make 
available an equivalent CSRS/FERS benefits estimate upon request.
    While counseling employees who request it and assisting them in 
understanding how the systems affect their individual circumstances, 
agencies should emphasize that the final decision on which system the 
employee chooses is a personal one.
    An agency decision that an employee is not eligible to elect FERS 
coverage or an agency's refusal to accept a belated election must be in 
writing and must notify the employee of the right to appeal the 
decision to MSPB and the 30-day time limit applicable to such

[[Page 33233]]

appeals. The employing agency is also responsible for defending such a 
coverage decision at MSPB. Each agency should keep such documentation 
that it considers appropriate for that purpose.
    Since the statute expressly requires notice and, if requested, 
other information concerning the election including a comparison of 
benefits be provided to employees, the failure to provide these 
materials is a basis for tolling the time limit for making the 
election. See e.g., Davies v. OPM, 5 M.S.P.R. 199 (1981). Section 
846.724 empowers agencies (subject to review by MSPB under section 
846.725) to determine on a case-by-case basis whether they failed to 
provide sufficient information to justify acceptance of a belated 
election. The employing office may accept a belated election of FERS 
coverage without time limit if the employing office determines that the 
agency did not provide the notice required under section 846.723 in a 
timely manner, the agency did not provide access to the FERS Transfer 
Handbook to the employee in a timely manner, or the employee was 
unable, for cause beyond his or her control, to elect FERS coverage 
within the prescribed time limit. A belated election of FERS coverage 
is effective on the first day of the pay period beginning after the 
employing office receives the completed SF 3109, the FERS Election of 
Coverage form. Neither agencies nor OPM has any statutory authority to 
approve a retroactive effective date for belated elections of FERS 
coverage.
    Section 846.724 also continues the current rules concerning 
correction of administrative errors. Failure to begin employee 
deductions and Government contributions on the effective date of 
coverage must be corrected in accordance with section 841.505 of Title 
5, Code of Federal Regulations.
    Section 846.725 establishes the procedures for appeal of decisions 
affecting elections of coverage under FERS. A person whose rights or 
interests concerning an election of FERS coverage are affected by the 
agency's final decision may request MSPB to review the decision in 
accord with procedures prescribed by MSPB. MSPB regulations relating to 
appeals are contained in chapter II of Title 5, Code of Federal 
Regulations.
    Section 846.726 specifically delegates to agencies authority to act 
as OPM's agent for receipt of employee communications relating to 
elections of FERS coverage (i.e., any documents that employees are 
required by these regulations to file with OPM). Such documents are 
deemed received by OPM on the date that the employing office receives 
them. Such delegations are authorized under section 1104 of title 5, 
United States Code.
    Under section 553(b)(3)(B) and (d)(3) of title 5, United States 
Code, I find that good cause exists for waiving the general notice of 
proposed rulemaking and for making this rule effective in less than 30 
days. The notice is being waived and the regulation is being made 
effective in less than 30 days so that the regulation can be 
implemented in time to meet the statutory requirements of the Federal 
Employees Retirement System Open Enrollment Act of 1997. That statute 
requires the OPM to issue regulations under which individuals who are 
employed by the Federal Government and are covered by CSRS as of 
January 1, 1998 may elect to become covered by FERS. Such elections 
must be made between July 1, 1998 and December 31, 1998. This rule is 
being made effective in less than 30 days in order to establish timely 
election procedures and allow the regulation to be of maximum 
effectiveness and assistance for Federal agencies and employees 
considering their election options.

E.O. 12866, Regulatory Review

    This rule has been reviewed by the Office of Management and Budget 
in accordance with E.O. 12866.

Regulatory Flexibility Act

    I certify that this regulation will not have a significant economic 
impact on a substantial number of small entities because the regulation 
will only affect Federal employees and agencies and retirement payments 
to retired Government employees and their survivors.

List of Subjects in 5 CFR Part 846

    Administrative practice and procedure, Air traffic controllers, 
Firefighters, Government employees, Law enforcement officers, Pensions, 
Retirement.

U.S. Office of Personnel Management.
Janice R. Lachance,
Director.

    Accordingly, OPM amends 5 CFR part 846 as follows:

PART 846--FEDERAL EMPLOYEES RETIREMENT SYSTEM--ELECTIONS OF 
COVERAGE

    1. The heading of part 846 is revised to read as set forth above.
    1a. The authority citation for part 846 is revised to read as 
follows:

    Authority: 5 U.S.C. 8347(a) and 8461(g) and Title III of Pub. L. 
99-335, 100 Stat. 517; Sec. 846.201(b) also issued under 5 U.S.C. 
7701(b)(2) and section 153 of Pub. L. 104-134, 110 Stat. 1321; 
Sec. 846.201(d) also issued under section 11246(b) of Pub. L. 105-
33, 111 Stat. 251; Sec. 846.202 also issued under section 301(d)(3) 
of Pub. L. 99-335, 100 Stat. 517; Sec. 846.726 also issued under 5 
U.S.C. 1104; subpart G also issued under section 642 of Pub. L. 105-
61, 111 Stat. 1272.

    2. Subpart G is added to read as follows:

Subpart G--1998 Open Enrollment Elections

Sec.
846.701  Purpose and scope.
846.702  Definitions.
846.703  Effective date of FERS coverage.
846.704  Irrevocability of an election of FERS coverage.

Who May Elect

846.711  Eligibility to elect FERS coverage during the 1998 open 
enrollment period.
846.712  Statutory exclusions.
846.713  Former spouse consent requirement.

Election Procedures

846.721  Electing FERS coverage.
846.722  Former spouse's consent to an election of FERS coverage.
846.723  Agency responsibilities.
846.724  Belated elections and correction of administrative errors.
846.725  Appeal to the Merit Systems Protection Board.
846.726  Delegation of authority to act as OPM's agent for receipt 
of employee communications relating to elections.

Subpart G--1998 Open Enrollment Elections


Sec. 846.701  Purpose and scope.

    This subpart contains OPM's regulations applicable to elections of 
FERS coverage during the 1998 open enrollment period, including--
    (a) The requirements that an individual must satisfy to be eligible 
to make an election; and
    (b) The procedures that--
    (1) Employees must follow to make an election;
    (2) Agencies must follow in advising employees about making an 
election and in processing employees' elections; and
    (3) OPM will follow in cases subject to the former spouse consent 
requirement.


Sec. 846.702  Definitions.

    In this subpart--
    Election means an election of FERS coverage during the 1998 open 
enrollment period.
    Former spouse consent requirement means the condition that must be 
satisfied under section 301(d) of the FERS Act for an employee with a 
former spouse to be eligible to elect FERS coverage.

[[Page 33234]]

    Qualifying court order means a court order acceptable for 
processing as defined in Sec. 838.103 of this chapter or a qualifying 
court order as defined in Sec. 838.1003 of this chapter subject to the 
following conditions:
    (1) If OPM has not received (as explained in Sec. 838.131 of this 
chapter) a copy of the court order and identifying information required 
under Sec. 838.221(b)(3), Sec. 838.421(b)(3), Sec. 838.721(b)(1)(iii), 
or Sec. 838.1005(b)(3) of this chapter prior to the date on which the 
employing office receives the election to be covered by FERS, the court 
order is not a qualifying court order.
    (2) If the former spouse loses entitlement to all CSRS benefits 
under the court order, the court order ceases to be a qualifying court 
order.
    Social security coverage means coverage under the Old Age, 
Survivors, and Disability Insurance program under the Social Security 
Act.
    1998 open enrollment period means July 1, 1998, through December 
31, 1998.


Sec. 846.703  Effective date of FERS coverage.

     An election under this subpart is effective on the later of--
    (a) The first day of the pay period beginning after the date the 
election and any required supporting documentation is received by the 
employing office; or
    (b) The first day of the pay period beginning after July 1, 1998.


Sec. 846.704  Irrevocability of an election of FERS coverage.

    (a) An election to be covered by FERS becomes irrevocable on the 
date it becomes effective.
    (b) If, during the 1998 open enrollment period, an employee files 
an election on an SF 3109 to remain covered by CSRS, the employee may 
revoke such an election by filing another election during the 1998 open 
enrollment period.

Who May Elect


Sec. 846.711  Eligibility to elect FERS coverage during the 1998 open 
enrollment period.

    An employee who is not covered by FERS, and who was an employee on 
January 1, 1998, and who is not otherwise ineligible for FERS coverage 
(under subpart A of part 842 of this chapter or Sec. 846.722) may elect 
FERS coverage during the 1998 open enrollment period.


Sec. 846.712  Statutory exclusions.

    (a) DC government employees. An individual employed by the 
government of the District of Columbia is not eligible to make an 
election, except--
    (1) Non-judicial employees of the District of Columbia Courts, 
District of Columbia Department of Corrections Trustee or the District 
of Columbia Pretrial Services, Defense Services, Parole, Adult 
Probation and Offender Supervision Trustee under the National Capital 
Revitalization and Self-Government Improvement Act of 1997, title XI of 
Public Law 105-33, 111 Stat. 251, who meet the conditions of 
Sec. 831.201(g)(2), (3), and (4) of this chapter; and
    (2) Employees of the District of Columbia Financial Responsibility 
and Management Assistance Authority under the District of Columbia 
Financial Responsibility and Management Assistance Act of 1995, Public 
Law 104-8, 109 Stat. 97, as amended, who elected CSRS under 
Sec. 831.201(g)(5) of this chapter.
    (b) Members of Congress. A Member (as defined in section 2106 of 
title 5, United States Code) is not eligible to make an election.
    (c) Persons without social security eligibility. An individual is 
not eligible to make an election if that individual is not eligible for 
social security coverage.


Sec. 846.713  Former spouse consent requirement.

    An election of FERS coverage cannot become effective unless the 
election is made with the written consent of any former spouse(s) 
entitled to benefits under part 838 of this chapter.

Election Procedures


Sec. 846.721  Electing FERS coverage.

    (a) To elect FERS coverage, an employee must submit a completed 
FERS Election of Coverage form (SF 3109) and any additional 
documentation that may be required under Sec. 846.722 (relating to the 
former spouse consent requirement) to the employing office no later 
than the close of business on December 31, 1998.
    (b) Any writing signed by the employee and filed with the employing 
office may be treated as an election for the purpose of establishing 
the date of the election of FERS coverage if the employee intends that 
document to be an election, but the employee (or, if the employee dies 
after filing the election but before completing the SF 3109, the 
survivor) must submit a completed SF 3109 to confirm any such election.


Sec. 846.722  Former spouse's consent to an election of FERS coverage.

    (a) Employee actions. (1) If the employee is subject to a 
qualifying court order, the employee must submit to the employing 
office a completed--
    (i) SF 3110, Former Spouse's Consent to FERS Election, to document 
the former spouse's consent to the FERS coverage; or
    (ii) SF 3111, Request for Waiver, Extension, or Search, to request 
a waiver of the former spouse consent requirement or to request an 
extension of the time limit for obtaining a former spouse's consent or 
amendment of the court order.
    (2) If the employee states on the SF 3109, the FERS Election of 
Coverage form, that he or she does not know whether he or she is 
subject to a qualifying court order, the employee must submit to the 
employing office a completed SF 3111, Request for Waiver, Extension, or 
Search, to request OPM to determine whether it has a qualifying court 
order relating to the employee.
    (b) OPM actions--(1) Waiver of former spouse consent requirement--
(i) Grounds for waiver. OPM's authority to approve a waiver of the 
former spouse consent requirement is limited to cases in which the 
former spouse's whereabouts cannot be determined or exceptional 
circumstances make requiring the former spouse's consent inappropriate.
    (ii) Whereabouts cannot be determined. OPM will waive the former 
spouse consent requirement upon a showing that the former spouse's 
whereabouts cannot be determined. A request for waiver on this basis 
must be accompanied by--
    (A) A judicial or administrative determination that the former 
spouse's whereabouts cannot be determined; or
    (B)(1) Affidavits by the employee and two other persons, at least 
one of whom is not related to the employee, attesting to the inability 
to locate the former spouse and stating the efforts made to locate the 
spouse; and
    (2) Documentary corroboration such as newspaper reports about the 
former spouse's disappearance.
    (iii) Exceptional circumstances. OPM will waive the former spouse 
consent requirement based on exceptional circumstances if the employee 
presents a judicial determination finding that--
    (A) The case before the court involves a Federal employee who is in 
the process of electing FERS coverage and the former spouse of that 
employee;
    (B) The former spouse has been given notice and an opportunity to 
be heard concerning this proceeding;
    (C) The court has considered sections 301 and 302 of the FERS Act, 
Pub. L. 99-335, 100 Stat. 517, and this section as they relate to 
waiver of the former spouse consent requirement for an employee with a 
former spouse to elect FERS coverage; and

[[Page 33235]]

    (D) The court finds that exceptional circumstances exist justifying 
waiver of the former spouse's consent.
    (iv) Approval of a waiver. If OPM grants a waiver of the 
requirement of paragraph (a) of this section, OPM will notify both the 
individual and the employing office of its decision. OPM's notice to 
the employing office is deemed to complete the individual's election, 
which becomes effective with the first pay period after the employing 
office receives OPM's notice that the waiver is granted.
    (2) Extension of the time limit to obtain a former spouse's 
consent--(i) First request. If an employee who is ineligible to elect 
FERS coverage solely because of a qualifying court order files, prior 
to January 1, 1999, a completed SF 3111, Request for Waiver, Extension 
or Search, requesting an extension of the time limit to seek an 
amendment of a qualifying court order, OPM is deemed to have approved 
the extension through June 30, 1999.
    (ii) Second request. OPM will grant one extension of the time limit 
to seek an amendment of a qualifying court order to an individual who 
has been granted an extension under paragraph (b)(2)(i) of this section 
if the individual--
    (A) Files an application for the extension (SF 3109) with the 
employing office before July 1, 1999;
    (B) Has initiated legal proceedings to secure the modification of 
the qualifying court order on file at OPM to satisfy the former spouse 
consent requirement;
    (C) Demonstrates to OPM's satisfaction that the individual has 
exercised due diligence in seeking to obtain the modification; and
    (D) If seeking an extension beyond December 31, 1999, demonstrates 
to OPM's satisfaction that a longer extension is necessary.
    (iii) Expiration date of a second extension. An approved extension 
under paragraph (b)(2)(ii) of this section expires on December 31, 
1999, unless OPM's decision letter states a later expiration date.
    (3) Search for a qualifying court order. (i) When an employing 
office notifies OPM that it has received an employee's request for a 
determination of whether OPM has a qualifying court order on file, OPM 
will determine whether it has such an order.
    (ii) If OPM does not have a copy of a qualifying court order in its 
possession, OPM's notice to the employing office that it has no 
qualifying court order completes the employee's election of FERS 
coverage and the election becomes effective at the beginning of the 
first pay period after the employing office receives OPM's 
notification.
    (iii) If OPM has a copy of a qualifying court order, OPM will 
notify both the individual and the employing office that it has a 
qualifying court order and that an extension until June 30, 1999, has 
been granted.


Sec. 846.723  Agency responsibilities.

    (a) The employing office must determine whether the employee is 
eligible to elect FERS coverage.
    (b)(1) As close as practicable to the beginning of the open 
enrollment period, the employing office must provide each employee 
eligible to elect FERS coverage with notice of that employee's right to 
make an election.
    (2) The employing office must provide each employee eligible to 
elect FERS coverage with a copy of or ready access to the FERS Transfer 
Handbook.
    (c) An election received by an employing office before July 1, 
1998, is deemed to have been received by the employing office on July 
1, 1998.
    (d) An agency decision that an employee is not eligible to elect 
FERS coverage or refusing to accept a belated election under 
Sec. 846.724 must be in writing, must fully set forth the findings and 
conclusions of the agency, and must notify the employee of the right to 
appeal the decision under this section to the Merit Systems Protection 
Board, including all information required under the Board's 
regulations. See 5 CFR 1201.21.


Sec. 846.724  Belated elections and correction of administrative 
errors.

    (a) Belated elections. The employing office may accept a belated 
election of FERS coverage if it determines that--
    (1) The employing office did not provide adequate notice to the 
employee in a timely manner;
    (2) The agency did not provide access to the FERS Transfer Handbook 
to the employee in a timely manner; or
    (3) The employee was unable, for cause beyond his or her control, 
to elect FERS coverage within the prescribed time limit.
    (b) Correction of administrative errors. Failure to begin employee 
deductions and Government contributions on the effective date of 
coverage must be corrected in accordance with Sec. 841.505 of this 
chapter.


Sec. 846.725  Appeal to the Merit Systems Protection Board.

    (a) A person whose rights or interests under this part are affected 
by an agency decision that an employee is not eligible to elect FERS 
coverage or an agency refusal to accept a belated election under 
Sec. 846.724, or an OPM decision denying an extension or waiver under 
Sec. 846.722, may request the Merit Systems Protection Board (MSPB) to 
review such decision in accord with procedures prescribed by MSPB. MSPB 
regulations relating to appeals are contained in chapter II of this 
title.
    (b) Paragraph (a) of this section is the exclusive remedy for 
review of agency decisions concerning eligibility to make an election 
under this subpart. An agency decision must not allow review under any 
employee grievance procedures, including those established by chapter 
71 of title 5, United States Code, and 5 CFR part 771.


Sec. 846.726  Delegation of authority to act as OPM's agent for receipt 
of employee communications relating to elections.

    The employing office is delegated authority to act as OPM's agent 
for the receipt of any documents that employees are required by this 
subpart to file with OPM. Such documents are deemed received by OPM on 
the date that the employing office receives them.

[FR Doc. 98-16264 Filed 6-17-98; 8:45 am]
BILLING CODE 6325-01-P