[Federal Register Volume 72, Number 248 (Friday, December 28, 2007)]
[Rules and Regulations]
[Pages 73573-73579]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-25153]



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  Federal Register / Vol. 72, No. 248 / Friday, December 28, 2007 / 
Rules and Regulations  

[[Page 73573]]



OFFICE OF PERSONNEL MANAGEMENT

5 CFR Part 850

RIN 3206-AL34


Retirement Systems Modernization

AGENCY: Office of Personnel Management.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: The Office of Personnel Management (OPM) is issuing final 
regulations to authorize alternative provisions for processing 
retirement and health and life insurance applications, notices, 
elections, and records under the agency's Retirement Systems 
Modernization (RSM) initiative. These regulations authorize exceptions 
to certain regulatory provisions governing the processing of benefits 
under the Civil Service Retirement System (CSRS) and the Federal 
Employees' Retirement System (FERS), as well as the Federal Employees' 
Group Life Insurance (FEGLI), the Federal Employees Health Benefits 
(FEHB) and Retired Federal Employee Health Benefits (RFEHB) Programs.

DATES: The regulations are effective January 28, 2008.

FOR FURTHER INFORMATION CONTACT: James Giuseppe, (202) 606-0299.

SUPPLEMENTARY INFORMATION: 

Overview of Retirement Systems Modernization

    On August 17, 2007, the Office of Personnel Management (OPM) 
published proposed regulations (72 FR 46178) to amend title 5, Code of 
Federal Regulations, by establishing a new part 850. The new part 
authorizes certain changes to current regulations governing the Civil 
Service Retirement System (CSRS), the Federal Employees' Retirement 
System (FERS), and the Federal Employees' Group Life Insurance (FEGLI), 
the Federal Employees Health Benefits (FEHB) and Retired Federal 
Employees Health Benefits (RFEHB) Programs. The changes are needed to 
implement the new retirement and insurance processing system created by 
OPM's Retirement Systems Modernization (RSM) initiative.
    The 30-day comment period for the proposed regulations ended on 
September 17, 2007. OPM received comments from five Federal agencies, 
one labor organization, and one individual.

General Comments

    Two comments stated that many individuals have only limited access 
to the Internet. These commenters expressed concern that RSM would 
require individuals to submit retirement applications, elections, and 
other forms electronically, and that OPM would not accept such 
submissions in paper form. We understand that when RSM is implemented, 
some individuals will continue to submit paper applications and forms 
because they will not have access to a computer or the Internet, or 
because they are unfamiliar with computers or are not confident of 
their ability to use a computer. As we stated in the supplementary 
information published with the proposed rule, the current paper-based 
system ``will continue to operate concurrently for some time with 
respect to at least some aspects of retirement and insurance processing 
for some individuals.'' Section 850.101(b) of the regulations states 
that the regulations authorize (but do not require) ``exceptions'' to 
the existing regulatory provisions. Section 850.201(a)(1) provides that 
applications and other submissions ``may instead'' be submitted in 
another form designated by the Director. This language pertaining to 
exceptions to established procedures is deliberately permissive, not 
mandatory. In other words, the current provisions of the regulations do 
nothing to preclude paper-based processes from continuing to function; 
therefore, applications and other submissions that are submitted in 
paper form will continue to be accepted under the relevant provisions 
of existing regulations outside of part 850. Part 850 merely allows 
electronic submissions to OPM in addition to paper submissions.
    One commenter suggested that the regulations are being issued 
because ``the convenience of OPM is the priority'' rather than the 
needs of employees and retirees. In fact, the thrust of RSM is to 
afford greater convenience to Federal annuitants and employees 
contemplating retirement by improving OPM processes. RSM is a customer-
focused initiative. RSM will also improve the quality and timeliness of 
services to individuals and will offer on-demand Web-based tools for 
employees to plan early for their retirement and for annuitants to make 
health and life insurance elections. We believe that RSM will improve 
both OPM business processes and services to our customers.

Electronic Signatures

    Several comments were received on the electronic signature 
provisions of the regulations. Many of these comments indicate a 
misunderstanding of the provisions of proposed Sec.  850.106. As 
discussed in the supplementary information published with the proposed 
rule, new Sec.  850.106 will allow the electronic retirement and 
insurance processing system implemented by RSM to be compliant with the 
Government Paperwork Elimination Act (GPEA), Pub. L. 105-277, Title 
XVII, and OMB Memorandum M-00-10, 65 FR 25508 (May 2, 2000)--OMB's 
final procedures and guidance for implementing the GPEA. OMB Memorandum 
M-00-10 describes, using examples of currently known technology, a 
range of acceptable methods of effecting electronic signatures, and 
describes the requirements an agency is to follow before selecting an 
appropriate method of electronic signature for a particular 
transaction. We are going through the process of determining which 
method of electronic signature will be acceptable for the various 
transactions permitted under the electronic retirement and insurance 
processing system. The Director will issue an implementing directive 
under Sec.  850.104 when methods of effecting electronic signatures are 
assessed and selected.
    We are aware that whatever method of electronic signature is 
ultimately selected for a transaction, it must permit the 
authentication of individuals' identities using the electronic 
retirement and insurance processing system while ensuring the privacy 
of their transaction. We are also aware that the method selected must 
be a

[[Page 73574]]

technology that will be readily available and accessible to individuals 
using the system. Although a technology may offer high levels of 
authentication and privacy, it may not be widely available, affordable, 
or accessible, and would then be unsuitable for selection.
    One commenter expressed concern that some of the electronic 
signature technologies described in the regulations could prevent users 
from readily accessing the electronic retirement and insurance 
processing system, or would inconvenience users who lack access to 
proper hardware or software. As stated above, we will select methods of 
effecting electronic signatures that offer the appropriate level of 
authentication and privacy and that will be widely available and user-
friendly. In addition, employees, annuitants, survivors, and other 
individuals who file claims or make other submissions to OPM will still 
have the option of making their submissions using the paper-based 
processes under the existing rules.
    Two comments addressed the issue of whether OPM would accept an 
electronic signature if it meets one of the ``acceptable methods'' 
listed under new Sec.  850.106(c), or whether OPM will establish a 
``standard method'' of electronic signature. This issue was discussed 
in the supplementary information published with the proposed rule. We 
must emphasize that none of the methods listed under Sec.  850.106(c) 
has yet been approved by the Director, and no one method listed in 
Sec.  850.106(c) is the only acceptable standard for effecting an 
electronic signature. Section 850.106(c) provides a list of electronic 
signature methods from which the Director may choose an acceptable 
method of an electronic signature for a particular transaction. The 
list is not exclusive; if a new technology is developed in the future 
and is found to be generally acceptable, the Director could decide to 
adopt that technology for certain transactions. As described in OMB 
Memorandum M-00-10, the selection of an electronic signature method is 
a transaction-based decision--an agency should select an appropriate 
method of effecting an electronic signature for each particular kind of 
transaction. For example, the Director could decide, based in part on 
the risks and costs involved, to select one method of electronic 
signature for retirement applications and a different method for a life 
insurance designation-of-beneficiary form. Alternatively, the Director 
might decide that one method of electronic signature is appropriate for 
a range of distinct but similar transactions, or that several methods 
are acceptable for a single type of transaction. The purpose of the 
regulation is to give the Director flexibility to choose acceptable 
methods of electronic signatures. The Director will issue an 
implementing directive when a method or methods of electronic signature 
is selected for transactions submitted to the electronic retirement and 
insurance processing system.

Submission of the Retirement Application

    Two commenters expressed concern that Sec.  850.201 of the proposed 
regulations indicated that an employee may submit her retirement 
application to OPM instead of the servicing agency, thus bypassing the 
servicing agency. The electronic retirement and insurance processing 
system will allow employees to initiate the retirement process 
directly; however, agencies and servicing agencies will receive 
notification that the employee has commenced the retirement process. 
Under new Sec.  850.105, agencies will continue to be responsible for 
counseling individuals regarding rights and benefits under CSRS, FERS, 
FEGLI, FEHB, and RFEHB, and for performing all appropriate actions 
necessary to separate individuals for retirement.

Subpart D--Submission of Law Enforcement, Firefighter, and Nuclear 
Materials Courier Retirement Coverage Notices

Background
    In the past, OPM made Civil Service Retirement System (CSRS) law 
enforcement officer and firefighter retirement coverage determinations. 
OPM used its authority over these retirement coverage determinations to 
ensure that the statutory requirements for coverage were appropriately 
applied and to monitor the costs of the program.
    As part of its efforts to decentralize personnel functions and to 
place the decision-making responsibility in agencies that have the 
greatest interest in such determinations, OPM delegated Federal 
Employees' Retirement System (FERS) law enforcement officer and 
firefighter retirement coverage decision-making authority to agency 
heads with the inception of FERS in 1987. (See 52 FR 2068 (January 16, 
1987) and 5 CFR part 842, subpart H.) Under this delegated authority, 
agencies ensure that the statutory requirements for FERS law 
enforcement officer or firefighter coverage are met. In addition, this 
delegation was considered appropriate given the cost structure of FERS. 
FERS retirement benefit costs are fully funded by employee and agency 
contributions. Because the full cost of FERS retirement benefits is 
paid for by employee and agency contributions, with the primary 
financial burden on the agency, the agency must account for the costs 
of law enforcement officer and firefighter benefits. CSRS law 
enforcement officer and firefighter coverage decision-making authority 
was extended to agencies in 1993. Specifically, OPM delegated CSRS law 
enforcement officer and firefighter decision-making authority to agency 
heads in interim regulations issued on December 7, 1993. (See 58 FR 
64367 (December 7, 1993); 5 CFR part 831, subpart I.) The authority 
over nuclear materials courier retirement coverage decisions was 
delegated to the Secretary of Energy when enhanced retirement benefits 
were extended to nuclear materials couriers. (See 65 FR 2521 (January 
18, 2000); 5 CFR part 831, subpart H, and 5 CFR part 842, subpart I.)
    Under the existing regulations, OPM retains oversight authority to 
review agency head approvals of law enforcement officer, firefighter, 
and nuclear materials courier decisions. When we issued the FERS final 
rules for law enforcement officers, firefighters and air traffic 
controllers, we explained the reason for OPM oversight: ``OPM's 
oversight role is an inherent part of its underlying statutory 
authority to make these determinations and its continuing 
responsibility to determine whether continued delegation of this 
authority is appropriate'' (57 FR 32687).
    In the years since we delegated law enforcement officer and 
firefighter decision-making authority to agencies, there have been 
occasional problems with agency compliance with the recordkeeping and 
notice provisions of the oversight regulations. Each agency is required 
by regulation to maintain records of law enforcement and firefighter 
retirement coverage approvals made by the agency head, and must send a 
notice to OPM whenever a position is approved for law enforcement and 
firefighter retirement coverage. On one occasion, an agency requested 
that we provide copies of all law enforcement notices that the agency 
had sent to OPM since 1987 because the agency could not locate its 
records. Recently, OPM noticed that an agency had submitted a notice of 
law enforcement officer coverage for a position that had been 
established more than 22 years before. When OPM asked for clarification 
of the approval under its oversight authority, the agency responded 
that it had neglected to approve or send OPM the required notice for 
the position because agency staff ``did not realize that LEO approval

[[Page 73575]]

was necessary.'' Occasionally, OPM has had to exercise oversight by 
reviewing an agency law enforcement officer or firefighter retirement 
coverage decision, or by intervening in an appeal to the U.S. Merit 
Systems Protection Board of an agency law enforcement officer or 
firefighter retirement coverage decision.
    In addition, under current procedures, when an employee who has law 
enforcement officer or firefighter service applies for retirement, the 
agency must send a letter containing information on the employee's law 
enforcement officer or firefighter service history to OPM with the 
employee's retirement application. OPM uses this letter and other 
information to determine whether the employee is eligible for law 
enforcement officer or firefighter retirement and an enhanced annuity 
computation. Under this procedure, if an agency has erroneously allowed 
law enforcement officer or firefighter retirement coverage or service 
credit, the error may not be discovered until OPM receives the 
employee's retirement application and determines that the employee is 
not entitled to retire under the law enforcement officer or firefighter 
retirement provisions, or determines that the employee has insufficient 
law enforcement officer or firefighter service for the higher law 
enforcement officer or firefighter annuity computation. These errors 
may result in an erroneous separation, and, thus, may be costly to an 
agency and traumatic for an employee.
    The new electronic retirement and insurance processing system will 
provide employees, annuitants, and survivors with access to their 
retirement and insurance information in a manner that was not 
previously available to them. Data elements will now be available on a 
pay-period or daily basis rather than an annual basis. Web-based tools 
will be available on demand for Federal employees to plan early for 
retirement.
    Obviously, the electronic retirement and insurance processing 
system must have information that is not only timely but also accurate 
so that users of the system can make retirement, health benefits, and 
life insurance decisions appropriate to their individual situations. 
Employees with law enforcement officer, firefighter, or nuclear 
materials courier service must be able to accurately determine the 
status of their law enforcement officer, firefighter, or nuclear 
materials courier retirement coverage and service credit at any time, 
so that they can make informed retirement decisions. Therefore, the 
electronic retirement and insurance processing system must have 
sufficient information to automatically determine the status of an 
employee's law enforcement officer, firefighter, or nuclear materials 
courier coverage and the amount of such service the employee has 
performed.
Comments on Subpart D
    After the proposed rule was published, OPM sent a request for 
comments on subpart D to agencies and shared service centers. Four 
comments from agencies addressed subpart D of the regulation. One 
comment stated that the proposed rule provided insufficient information 
concerning how agency notices to OPM of agency law enforcement officer, 
firefighter, and nuclear materials courier retirement coverage 
decisions could be provided electronically, and what information OPM 
would require. Another comment stated that subpart D does not provide 
enough information to estimate the changes agencies will have to make 
to submit notices through the Enterprise Human Resources Integration 
(EHRI). This comment also suggested that it might be more appropriate 
to scan the requested documents into the Electronic Official Personnel 
Record Folder (e-OPF) rather than submit them through EHRI.
    We anticipated that, under subpart D, the submission of notices and 
background files through EHRI would not be difficult. In general, based 
on the volume of notices we have received in the past, agencies do not 
submit a large number of law enforcement officer, firefighter, and 
nuclear materials courier notices. Based on our experience, we 
anticipated that the electronic submission of notices would require 
only periodic transmission of data, and would not be as demanding as 
the transmission of pay period data required by the regular EHRI feed. 
Further, using the e-OPF to store the required data would present new 
problems because the e-OPF data would be difficult to integrate into 
RSM systems and new system applications would be required to extract 
the data from the e-OPF.
    However, as a result of the comments we received, we have decided 
to change subpart D to eliminate the requirement that agencies submit 
notices of law enforcement officer, firefighter, or nuclear materials 
courier retirement coverage approvals electronically through EHRI to 
the RSM processing system. We have decided that we will begin to gather 
agency notices of law enforcement officer, firefighter, or nuclear 
materials courier retirement coverage approvals and associated 
background files in an electronic form, through a more straightforward 
process. At some point in the future, we intend to transition to the 
electronic submission of these notices and associated background files 
through EHRI. In the meantime, we will require that the information 
described in subpart D be submitted, but we are changing the 
regulations to permit the Director to issue implementing directives 
concerning the process for submitting the information. We expect that 
these implementing directives will allow the agencies to continue to 
submit notices in paper form, but will require that a spreadsheet 
containing the required notice data elements be e-mailed to OPM along 
with a file containing scans of the background documents.
    Another commenter stated that the agency did not store a position 
description number, which was requested in the proposed rule, for its 
law enforcement and firefighter positions; instead, the agency stores 
an ``Individual Position and Master Record number.'' The requirement is 
that agencies submit a position description number, or some other 
unique identifying number. An ``Individual Position and Master Record 
number'' would constitute such a unique identifying number, and thus 
would suffice for the positions contained in the notice. We require 
this number to enable us to identify particular position approvals. 
This identifier is also required in the EHRI recurring pay period data 
feeds to RSM. Accordingly, we are not revising this requirement.
    A comment from another agency stated that it did not ``list 
position description numbers, only places of employment and whether the 
position is [a law enforcement officer] or [non-law enforcement 
officer] position.'' Presumably, this comment refers to employees of 
the agency who fall within the definition of ``law enforcement 
officer'' under 5 U.S.C. Sec.  8331(20) or 5 U.S.C. 8401(17)(D) because 
their duties require frequent and direct contact with individuals in 
detention suspected or convicted of offenses against the criminal laws 
of the United States, or other laws. Law enforcement officer retirement 
coverage for such individuals is not strictly based on the position the 
individual occupies; rather it is based on the individual's frequent 
and direct contact with detainees.
    We are aware of the retirement coverage issues related to 
correctional officers and prison support staff. However, the fact that 
a position is located in a prison and meets the statutory requirements 
for law enforcement officer retirement coverage should not prevent the 
agency from

[[Page 73576]]

assigning a position description number to a position description. In 
addition, the agency that submitted this comment has provided position 
description numbers for detention positions to us in its written 
notices for many years.

Comments Beyond the Scope of the Regulations

    A number of comments we received addressed issues concerning the 
RSM design process, the implementation of RSM processes, the process of 
bringing an agency and its employees within RSM, and other issues that 
are operational in nature and, therefore, are beyond the scope of the 
regulations. We have not addressed those comments but rather have 
submitted them to OPM's Managing Director for Retirement Systems 
Modernization for his consideration. The following is a list of some of 
the comments that, although important, are beyond the scope of these 
regulations:
     One union expressed disappointment concerning the 
perceived lack of involvement of OPM employees in developing RSM.
     One commenter questioned what quality control measures 
exist to insure data quality and accuracy, and what measures for 
records destruction are in place.
     Two commenters asked what redundancy OPM will have in 
place in the event of disaster, and whether OPM will back up data.
     One agency expressed concern over the number of historical 
data elements required by RSM.
     One commenter asked how RSM would accommodate disability 
retirement applications, how agencies would certify service records, 
and whether an employee's current health benefits and life insurance 
benefits history would be transferred to the new system.
     One commenter expressed concern that the RSM 
implementation schedule and the February 2008 RSM rollout date are too 
ambitious and that OPM is not providing much time to agencies to 
prepare for implementation.

Again, these issues are beyond the scope of the regulations and have 
been referred to OPM's Managing Director for Retirement Systems 
Modernization.

Definition of ``Agency'' and Other Editorial Changes

    We have made an editorial change in Sec.  850.302 to clarify the 
reference to a department or agency and added a definition of 
``agency'' in Sec.  850.103. We have also corrected a typographical 
error in Sec.  850.202(b)(2) by correcting the reference to Sec.  
841.610(b)(1) to Sec.  842.610(b)(1).

E.O. 12866, Regulatory Review

    The Office of Management and Budget has reviewed this rule in 
accordance with Executive Order 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 affect only Federal employees, former Federal employees, Members 
of Congress, annuitants, survivors, and applicants under the Civil 
Service Retirement System and the Federal Employees' Retirement System 
whose retirement and insurance records are maintained by the new 
retirement processing system created by OPM's Retirement Systems 
Modernization initiative.

Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35)

    Information collection(s) as defined by the Paperwork Reduction Act 
and associated with this rule will not be effective until approved by 
OMB. The information collection(s) will include the processes and 
information collected from Federal retirees and their survivors 
described in this rule. A separate Federal Register Notice that details 
the information collection(s) will be posted for public comment at a 
later date.

List of Subjects in 5 CFR Part 850

    Administrative practice and procedure, Air traffic controllers, 
Alimony, Claims, Disability benefits, Firefighters, Government 
employees, Income taxes, Intergovernmental relations, Law enforcement 
officers, Pensions, Reporting and recordkeeping requirements, 
Retirement.

Office of Office of Personnel Management.
Linda M. Springer,
Director.

0
Accordingly, 5 CFR part 850 is added to read as follows:

PART 850--RETIREMENT SYSTEMS MODERNIZATION

Subpart A--General Provisions
Sec.
850.101 Purpose and scope.
850.102 Applicability.
850.103 Definitions.
850.104 Implementing directives.
850.105 Agency responsibility.
850.106 Electronic signatures.
Subpart B--Applications for Benefits; Elections
850.201 Applications for benefits.
850.202 Survivor elections.
850.203 Other elections.
Subpart C--Records
850.301 Electronic records; other acceptable records.
850.302 Record maintenance.
850.303 Return of personal documents.
Subpart D--Submission of Law Enforcement, Firefighter, and Nuclear 
Materials Courier Retirement Coverage Notices
850.401 Electronic notice of coverage determination.

    Authority: 5 U.S.C. 8347; 5 U.S.C. 8461; 5 U.S.C. 8716; 5 U.S.C. 
8913; section 9 of Pub. L. 86-724, 74 Stat. 849, 851-52 (September 
8, 1960) as amended by section 102 of Reorganization Plan No. 2 of 
1978, 92 Stat. 3781, 3783 (February 23, 1978).

Subpart A--General Provisions


Sec.  850.101  Purpose and scope.

    (a) The purpose of this part is to enable changes needed for 
implementation of the new retirement and insurance processing system 
created by the Office of Personnel Management's (OPM's) Retirement 
Systems Modernization (RSM) initiative. RSM is OPM's strategic 
initiative to improve the quality and timeliness of services to 
employees and annuitants covered by the Civil Service Retirement System 
(CSRS) and the Federal Employees' Retirement System (FERS) by using 
contemporary, automated business processes and supporting technology. 
The RSM initiative is designed to transform the retirement process, as 
well as the processing of annuitant insurance elections of Federal 
Employees' Group Life Insurance (FEGLI), Federal Employees Health 
Benefits Program (FEHB), and Retired Federal Employees Health Benefits 
Program (RFEHB) coverage, by employing more efficient and effective 
business systems to respond to increased customer demand for higher 
levels of customer service and online self-service tools.
    (b) The provisions of this part authorize exceptions from 
regulatory provisions that would otherwise apply to CSRS and FERS 
annuities and FEGLI, FEHB and RFEHB benefits processed by or at the 
direction of OPM under the RSM initiative. Those regulatory provisions 
that would otherwise apply were established for a paper-based 
retirement and insurance benefits processing system that may eventually 
be phased out but which will continue to operate concurrently with RSM 
for some time, until RSM is fully implemented. During the phased 
transition to RSM processing, certain regulations that were not 
designed with RSM in mind, and which are incompatible with RSM business

[[Page 73577]]

processes, must be set aside with respect to aspects of retirement and 
insurance processing accomplished under RSM. The regulations set forth 
in this part make the transition to RSM processes possible.
    (c) The provisions of this part do not affect retirement and 
insurance eligibility and annuity computation provisions. The 
provisions for capturing retirement and insurance data in an electronic 
format, however, may support, in some instances, more precise 
calculations of annuity and insurance benefits than were possible using 
paper records.


Sec.  850.102  Applicability.

    (a) The provisions of parts 831, 835, 837 through 839, 841 through 
847, 870, 890, and 891 of this chapter remain in effect, as applicable, 
except to the extent that they are inconsistent with one or more 
provisions of this part or implementing directives prescribed by the 
Director under Sec.  850.104.
    (b) The provisions of this part do not supersede or alter any 
functions performed by a private insurance company or carrier with 
which OPM has entered into a contract, or with which OPM may enter into 
a contract in the future, under chapter 87 or 89 of title 5, United 
States Code, or under any other provision of law or regulation.


Sec.  850.103  Definitions.

    In this part--
    Agency means an Executive agency as defined in section 105 of title 
5, United States Code; a legislative branch agency; a judicial branch 
agency; the U.S. Postal Service; the Postal Regulatory Commission; and 
the District of Columbia government.
    Biometrics refers to the technology that converts a unique 
characteristic of an individual into a digital form, which is then 
interpreted by a computer and compared with a digital exemplar copy of 
the characteristic stored in the computer. Among the unique 
characteristics of an individual that can be converted into a digital 
form are voice patterns, fingerprints, and the blood vessel patterns 
present on the retina of one or both eyes.
    Cryptographic control method means an approach to authenticating 
identity or the authenticity of an electronic document through the use 
of a cipher (i.e., a pair of algorithms) which performs encryption and 
decryption.
    CSRS means the Civil Service Retirement System established under 
subchapter III of chapter 83 of title 5, United States Code.
    Digital signature is an electronic signature generated by means of 
an algorithm that ensures that the identity of the signatory and the 
integrity of the data can be verified. A value, referred to as the 
``private key,'' is generated to produce the signature, and another 
value, known as the ``public key,'' which is linked to, but not the 
same as, the private key, is used to verify the signature.
    Digitized signature means a graphical image of a handwritten 
signature, usually created using a special computer input device, such 
as a digital pen and pad, which contains unique biometric data 
associated with the creation of each stroke of the signature, such as 
duration of stroke or pen pressure. A digitized signature can be 
verified by a comparison with the characteristics and biometric data of 
a known or exemplar signature image.
    Director means the Director of the Office of Personnel Management.
    Electronic communication refers to any information conveyed through 
electronic means and includes electronic forms, applications, 
elections, and requests submitted by email or any other electronic 
message.
    Electronic Official Personnel Record Folder (e-OPF) means the 
electronic Official Personnel Folder application that will replace the 
current paper personnel folder across the Government.
    Electronic retirement and insurance processing system means the new 
retirement and insurance processing system created by OPM's Retirement 
Systems Modernization (RSM) initiative.
    Employee means an individual, other than a Member of Congress, who 
is covered by CSRS or FERS.
    Enterprise Human Resources Integration (EHRI) means the 
comprehensive electronic personnel record-keeping and analysis system 
that supports human resources management across the Federal Government.
    FEGLI means the Federal Employees' Group Life Insurance Program 
established under chapter 87 of title 5, United States Code.
    FEHB means the Federal Employees Health Benefits Program 
established under chapter 89 of title 5, United States Code.
    FERS means the Federal Employees' Retirement System established 
under chapter 84 of title 5, United States Code.
    Member means a Member of Congress as defined by section 2106 of 
title 5, United States Code, who is covered by CSRS or FERS.
    Non-cryptographic method is an approach to authenticating identity 
that relies solely on an identification and authentication mechanism 
that must be linked to a specific software platform for each 
application.
    Personal identification number (PIN) or password means a non-
cryptographic method of authenticating the identity of a user of an 
electronic application, involving the use of an identifier known only 
to the user and to the electronic system, which checks the identifier 
against data in a database to authenticate the user's identity.
    Public/private key (asymmetric) cryptography is a method of 
creating a unique mark, known as a digital signature, on an electronic 
document or file. This method involves the use of two computer-
generated, mathematically-linked keys: a private signing key that is 
kept private and a public validation key that is available to the 
public.
    RFEHB means the Retired Federal Employees Health Benefits Program 
established under Pub. L. 86-724, 74 Stat. 849, 851-52 (September 8, 
1960), as amended.
    Shared service centers are processing centers delivering a broad 
array of administrative services to multiple agencies.
    Shared symmetric key cryptography means a method of authentication 
in which a single key is used to sign and verify an electronic 
document. The single key (also known as a ``private key'') is known 
only by the user and the recipient or recipients of the electronic 
document.
    Smart card means a plastic card, typically the size of a credit 
card, containing an embedded integrated circuit or ``chip'' that can 
generate, store, or process data. A smart card can be used to 
facilitate various authentication technologies that may be embedded on 
the same card.


Sec.  850.104  Implementing directives.

    The Director must prescribe, in the form he or she deems 
appropriate, such detailed procedures as the Director determines to be 
necessary to carry out the purpose of this part.


Sec.  850.105  Agency responsibility.

    Agencies employing individuals whose retirement records or 
processing are affected by this part are responsible for counseling 
those individuals regarding their rights and benefits under CSRS, FERS, 
FEGLI, FEHB, or RFEHB.


Sec.  850.106  Electronic signatures.

    (a) Subject to any provisions prescribed by the Director under 
Sec.  850.104--
    (1) An electronic communication may be deemed to satisfy any 
statutory or regulatory requirement under CSRS,

[[Page 73578]]

FERS, FEGLI, FEHB or RFEHB for a written election, notice, application, 
consent, request, or specific form format;
    (2) An electronic signature of an electronic communication may be 
deemed to satisfy any statutory or regulatory requirement under CSRS, 
FERS, FEGLI, FEHB or RFEHB that an individual submit a signed writing 
to OPM;
    (3) An electronic signature of a witness to an electronic signature 
may be deemed to satisfy any statutory or regulatory requirement under 
CSRS, FERS, FEGLI, FEHB or RFEHB for a signature to be witnessed; and
    (4) Any statutory or regulatory requirement under CSRS, FERS, 
FEGLI, FEHB or RFEHB that a signature be notarized may be satisfied if 
the electronic signature of the person authorized to sign is attached 
to or logically associated with all other information and records 
required to be included by the applicable statute or regulation.
    (b) For purposes of this section, an electronic signature is a 
method of signing an electronic communication, including an 
application, claim, or notice, designation of beneficiary, or 
assignment that--
    (1) Identifies and authenticates a particular person as the source 
of the electronic communication; and
    (2) Indicates such person's approval of the information contained 
in the electronic communication.
    (c) The Director will issue directives under Sec.  850.104 that 
identify the acceptable methods of effecting electronic signatures for 
particular purposes under this part. Acceptable methods of creating an 
electronic signature may include--
    (1) Non-cryptographic methods, including--
    (i) Personal Identification Number (PIN) or password;
    (ii) Smart card;
    (iii) Digitized signature; or
    (iv) Biometrics, such as fingerprints, retinal patterns, and voice 
recognition;
    (2) Cryptographic control methods, including--
    (i) Shared symmetric key cryptography;
    (ii) Public/private key (asymmetric) cryptography, also known as 
digital signatures;
    (3) Any combination of methods described in paragraphs (c)(1) and 
(c)(2) of this section; or
    (4) Such other means as the Director may find appropriate.

Subpart B--Applications for Benefits; Elections


Sec.  850.201  Applications for benefits.

    (a)(1) Applications and related submissions that otherwise would be 
required by this chapter to be made in writing may instead be submitted 
in such form as the Director prescribes under Sec.  850.104.
    (2) Subject to any directives prescribed by the Director under 
Sec.  850.104, applications and related submissions that are otherwise 
required to be made to an individual's employing agency (other than by 
statute) may instead be submitted to the electronic retirement and 
insurance processing system or to OPM.
    (b) Data provided under subpart C of this part are the basis for 
adjudicating claims for CSRS and FERS retirement benefits, and will 
support the administration of FEGLI, FEHB and RFEHB coverage for 
annuitants, under this part.
    (c) For the purposes of this subpart, ``OPM notice'' means the 
notice informing the retiree or other individual of the annuity 
computation rate and of the elections made by the retiree or other such 
individual eligible to make such an election and informing him or her 
of the time limit under Sec.  850.202 or 850.203 for any election, 
revocation or change of election.


Sec.  850.202  Survivor elections.

    (a) A survivor election under subsection (j) or (k) of section 
8339, or under section 8416, 8417, or 8420 of title 5, United States 
Code, which is otherwise required to be in writing may be effected in 
such form as the Director prescribes under Sec.  850.104.
    (b)(1) Except as provided in Sec. Sec.  831.622(b)(1), 831.631, 
831.632, 842.610(b)(1), 842.611, and 842.612 of this chapter, an 
individual making a survivor election at the time of retirement may not 
revoke or change that election later than 35 days after the date of the 
OPM notice to the individual of the amount of annuity to which he or 
she is entitled.
    (2) A retiree may change a survivor election under Sec.  
831.622(b)(1) or Sec.  842.610(b)(1) of this chapter no later than 18 
months after the commencing date of the annuity to which he or she is 
entitled.


Sec.  850.203  Other elections.

    (a) Any other election may be effected in such form as the Director 
prescribes under Sec.  850.104. Such elections include but are not 
limited to--
    (1) Elections of coverage under CSRS, FERS, FEGLI, FEHB or RFEHB by 
individuals entitled to elect such coverage;
    (2) Applications for service credit and applications to make 
deposit; and
    (3) Elections regarding the withholding of State income tax from 
annuity payments.
    (b) Any election, which, if it were not processed under this part, 
would have a deadline described in reference to the first regular 
monthly payment or the date of final adjudication, may not be made 
later than 35 days after the date of the OPM notice to the individual 
concerned of the amount of annuity to which he or she is entitled.

Subpart C--Records


Sec.  850.301  Electronic records; other acceptable records.

    (a) Acceptable electronic records for processing by the electronic 
retirement and insurance processing system include--
    (1) Electronic employee data submitted by an agency or other entity 
through EHRI and stored within the new retirement and insurance 
processing system;
    (2) Electronic Official Personnel Folder (e-OPF) data; and
    (3) Documents, including hardcopy versions of the Individual 
Retirement Record (SF 2806 or SF 3100), or data obtained from such 
documents, that are converted to an electronic or digital form by means 
of image scanning or other forms of electronic or digital conversion.
    (b) Documents that are not converted to an electronic or digital 
form will continue to be acceptable records for processing by the 
retirement and insurance processing system.
    (c) OPM is required to retain documents after they have been 
converted to electronic records in accordance with title 44, United 
States Code.


Sec.  850.302  Record maintenance.

    (a) The retirement and insurance processing system does not affect 
the responsibilities of an agency with respect to employees or Members 
of Congress subject to subchapter III of chapter 83 or chapter 84 of 
title 5, United States Code, for the initiation and maintenance of 
records, evidence, or other information described in this title.
    (b) Agencies are responsible for correcting errors in data provided 
to OPM under Sec.  850.301.


Sec.  850.303  Return of personal documents.

    An individual who submits personal documents to OPM in support of a 
claim for retirement or insurance benefits may

[[Page 73579]]

have such documents returned to the individual if he or she requests 
the return of the documents when submitting the documents. If OPM 
receives a request for return of such documents at a later time, OPM 
may provide the individual with a copy of the document that is derived 
from electronic records.

Subpart D--Submission of Law Enforcement, Firefighter, and Nuclear 
Materials Courier Retirement Coverage Notices


Sec.  850.401  Electronic notice of coverage determination.

    (a) An agency or other entity that submits electronic employee 
records directly or through a shared service center to the electronic 
retirement and insurance processing system must include in the notice 
of law enforcement officer, firefighter, or nuclear materials 
retirement coverage, required by Sec.  831.811(a), 831.911(a), 
842.808(a), or 842.910(a) of this chapter, the position description 
number, or other unique alphanumeric identifier, of the position for 
which law enforcement officer, firefighter, or nuclear materials 
courier retirement coverage has been approved.
    (b) The Director will issue directives under Sec.  850.104 that 
identify the acceptable methods for an agency or other entity to submit 
to OPM electronic files of both the notice required by Sec.  
831.811(a), 831.911(a), 842.808(a), or 842.910(a) of this chapter, and 
the coverage determination files and background material required under 
Sec.  831.811(b), 831.911(b), 842.808(b), or 842.910(b) of this 
chapter, associated with the positions included in the notice.

 [FR Doc. E7-25153 Filed 12-27-07; 8:45 am]
BILLING CODE 6325-38-P