[Federal Register Volume 75, Number 118 (Monday, June 21, 2010)]
[Notices]
[Pages 35096-35098]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-14830]
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OFFICE OF PERSONNEL MANAGEMENT
Federal Employees' Retirement System; Present Value Factors
AGENCY: Office of Personnel Management.
ACTION: Notice.
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SUMMARY: The Office of Personnel Management (OPM) is providing notice
of adjusted present value factors applicable to retirees who elect to
provide survivor annuity benefits to a spouse based on post-retirement
marriage, and to retiring employees who elect the alternative form of
annuity or elect to credit certain service with nonappropriated fund
instrumentalities. This notice is necessary to conform the present
value factors to changes in demographic factors adopted by the Board of
Actuaries of the Civil Service Retirement System.
DATES: The revised present value factors apply to survivor reductions
or employee annuities that commence on or after October 1, 2010.
ADDRESSES: Send requests for actuarial assumptions and data to the
Board of Actuaries, care of Gregory Kissel, Actuary, Office of Planning
and Policy Analysis, Office of Personnel Management, Room 4307, 1900 E
Street, NW., Washington, DC 20415.
FOR FURTHER INFORMATION CONTACT: Kristine Prentice, (202) 606-0299.
SUPPLEMENTARY INFORMATION: Several provisions of the Federal Employees'
Retirement System (FERS) require
[[Page 35097]]
reduction of annuities on an actuarial basis. Under each of these
provisions, OPM is required to issue regulations on the method of
determining the reduction to ensure that the present value of the
reduced annuity plus a lump-sum equals, to the extent practicable, the
present value of the unreduced benefit. The regulations for each of
these benefits provide that OPM will publish a notice in the Federal
Register whenever it changes the factors used to compute the present
values of these benefits.
Section 842.706(a) of title 5, Code of Federal Regulations,
prescribes the method for computing the reduction in the beginning rate
of annuity payable to a retiree who elects an alternative form of
annuity under 5 U.S.C. 8420a. That reduction is required to produce an
annuity that is the actuarial equivalent of the annuity of a retiree
who does not elect an alternative form of annuity. The present value
factors listed below are used to compute the annuity reduction under 5
CFR 842.706(a).
Section 842.615 of title 5, Code of Federal Regulations, prescribes
the use of these factors for computing the reduction required for
certain elections to provide survivor annuity benefits based on a post-
retirement marriage or divorce under 5 U.S.C. 8416(b), 8416(c), or
8417(b). Under section 11004 of the Omnibus Budget Reconciliation Act
of 1993, Public Law 103-66, 107 Stat. 312, effective October 1, 1993,
OPM ceased collection of these survivor election deposits by means of
either a lump-sum payment or installments. Instead, OPM is required to
establish a permanent actuarial reduction in the annuity of the
retiree. This means that OPM must take the amount of the deposit
computed under the old law and translate it into a lifetime reduction
in the retiree's benefit. The reduction is based on actuarial tables,
similar to those used for alternative forms of annuity under section
8420a of title 5, United States Code.
Subpart F of part 847 of title 5, Code of Federal Regulations,
prescribes the use of present value factors for computing the
deficiency the retiree must pay to receive credit for certain service
with nonappropriated fund instrumentalities made creditable by an
election under section 1043 of Public Law 104-106, 110 Stat. 186.
OPM published the present value factors currently in effect on June
7, 2007, at 72 FR 31629. Elsewhere in today's Federal Register, OPM
published a notice to revise the normal cost percentage under the
Federal Employees' Retirement System (FERS) Act of 1986, Public Law 99-
335, 100 Stat. 514, based on changed demographic factors adopted by the
Board of Actuaries of the Civil Service Retirement System. Under 5
U.S.C. 8461(i), those changes require corresponding changes in the
present value factors used to produce actuarially equivalent benefits
when required by the FERS Act. The revised factors will become
effective on October 1, 2010, to correspond with the changes in FERS
normal cost percentages. For alternative forms of annuity, the new
factors will apply to annuities that commence on or after October 1,
2010. See 5 CFR 842.706. For survivor election deposits, the new
factors will apply to survivor reductions that commence on or after
October 1, 2010. See 5 CFR 842.615(b). For obtaining credit for service
with certain nonappropriated fund instrumentalities, the new factors
will apply to cases in which the date of computation under 5 CFR
847.603 is on or after October 1, 2010. See 5 CFR 847.602(c) and
847.603.
OPM is, therefore, revising the tables of present value factors to
read as follows:
Table I--FERS Present Value Factors for Ages 62 and Older
[Applicable to annuity payable following an election under 5 U.S.C.
8416(b), 8416(c), 8417(b), or 8420a, or under section 1043 of Public Law
104-106]
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Present value
Age factor
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62...................................................... 180.1
63...................................................... 175.2
64...................................................... 170.2
65...................................................... 165.1
66...................................................... 160.0
67...................................................... 154.9
68...................................................... 149.8
69...................................................... 144.7
70...................................................... 139.5
71...................................................... 134.3
72...................................................... 129.0
73...................................................... 123.6
74...................................................... 118.3
75...................................................... 113.0
76...................................................... 107.8
77...................................................... 102.7
78...................................................... 97.3
79...................................................... 92.0
80...................................................... 86.9
81...................................................... 81.9
82...................................................... 76.6
83...................................................... 71.7
84...................................................... 67.6
85...................................................... 63.1
86...................................................... 58.1
87...................................................... 53.5
88...................................................... 49.9
89...................................................... 46.8
90...................................................... 43.3
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Table II.A--FERS Present Value Factors for Ages 40 Through 61
[Applicable to annuity payable when annuity is not increased by cost-of-
living adjustments before age 62 following an election under 5 U.S.C.
Sec. Sec. Sec. 8416(b), 8416(c), 8417(b), or Sec. 8420a, or under
section 1043 of Public Law 104-106]
------------------------------------------------------------------------
Present value
Age factor
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40...................................................... 185.8
41...................................................... 186.1
42...................................................... 186.2
43...................................................... 186.3
44...................................................... 186.1
45...................................................... 185.7
46...................................................... 185.4
47...................................................... 185.1
48...................................................... 185.0
49...................................................... 184.6
50...................................................... 184.3
51...................................................... 184.2
52...................................................... 184.1
53...................................................... 184.0
54...................................................... 183.7
55...................................................... 183.4
56...................................................... 183.1
57...................................................... 182.9
58...................................................... 182.7
59...................................................... 182.6
60...................................................... 182.6
61...................................................... 182.6
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Table II.B--FERS Present Value Factors for Ages 40 Through 61
[Applicable to annuity payable when annuity is increased by cost-of-
living adjustments before age 62 following an election under 5 U.S.C.
8416(b), 8416 (c), 8417(b), or 8420a, or under section 1043 of Public
Law 104-106]
------------------------------------------------------------------------
Present value
Age factor
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40...................................................... 256.6
41...................................................... 254.3
42...................................................... 251.8
43...................................................... 249.2
44...................................................... 246.6
45...................................................... 243.9
46...................................................... 241.1
47...................................................... 238.1
48...................................................... 235.1
49...................................................... 231.9
50...................................................... 228.6
51...................................................... 225.2
52...................................................... 221.6
53...................................................... 217.9
54...................................................... 214.0
55...................................................... 210.0
56...................................................... 205.9
57...................................................... 201.5
58...................................................... 197.1
59...................................................... 192.5
60...................................................... 187.9
61...................................................... 183.1
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[[Page 35098]]
Table III--FERS Present Value Factors for Ages at Calculation Below 40
[Applicable to annuity payable following an election under section 1043
of Public Law 104-106]
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Present value
Age at calculation of a monthly
annuity
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17...................................................... 292.3
18...................................................... 291.4
19...................................................... 290.3
20...................................................... 289.3
21...................................................... 288.1
22...................................................... 286.9
23...................................................... 285.7
24...................................................... 284.5
25...................................................... 283.1
26...................................................... 281.8
27...................................................... 280.4
28...................................................... 279.0
29...................................................... 277.5
30...................................................... 275.9
31...................................................... 274.3
32...................................................... 272.6
33...................................................... 270.9
34...................................................... 269.0
35...................................................... 267.1
36...................................................... 265.2
37...................................................... 263.2
38...................................................... 261.1
39...................................................... 258.9
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U.S. Office of Personnel Management.
John Berry,
Director.
[FR Doc. 2010-14830 Filed 6-18-10; 8:45 am]
BILLING CODE 6325-39-P