[Federal Register Volume 85, Number 72 (Tuesday, April 14, 2020)]
[Rules and Regulations]
[Pages 20575-20577]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-07100]



 ========================================================================
 Rules and Regulations
                                                 Federal Register
 ________________________________________________________________________
 
 This section of the FEDERAL REGISTER contains regulatory documents 
 having general applicability and legal effect, most of which are keyed 
 to and codified in the Code of Federal Regulations, which is published 
 under 50 titles pursuant to 44 U.S.C. 1510.
 
 The Code of Federal Regulations is sold by the Superintendent of Documents. 
 
 ========================================================================
 

  Federal Register / Vol. 85, No. 72 / Tuesday, April 14, 2020 / Rules 
and Regulations  

[[Page 20575]]



OFFICE OF PERSONNEL MANAGEMENT

5 CFR Parts 831 and 842

RIN 3206-AN90


High-3 Calculation for Certain Privatized Senate Restaurants and 
House Food Services Employees and Annuitants Covered Under the Civil 
Service Retirement System and Federal Employees' Retirement System

AGENCY: Office of Personnel Management.

ACTION: Final rule.

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

SUMMARY: The Office of Personnel Management (OPM) is issuing a final 
rule to implement statutory provisions that guide the way in which OPM 
must compute annuities of certain career civilian United States Senate 
Restaurants employees of the Architect of the Capitol and United States 
House Food Service employees who were permitted to retain Civil Service 
Retirement System (CSRS) and Federal Employees' Retirement System 
(FERS) coverage after they became employees of a private contractor 
when food services operations were converted to a private contract.

DATES: Effective April 14, 2020.

FOR FURTHER INFORMATION CONTACT: Jane Bancroft, (202) 606-0299.

SUPPLEMENTARY INFORMATION: 

Introduction

    On January 6, 2020, OPM issued a proposed rule at 85 FR 467 for the 
purpose of proposing regulations meant to implement the provisions of 
Public Law 110-279,122 Stat. 2604 (2008) (codified at 2 U.S.C. 2051), 
as amended by Public Law 116-21, 133 Stat. 903 (2019), which allowed 
United States Senate Restaurants employees the ability to elect to 
retain CSRS and FERS coverage after the Architect of the Capitol 
transferred its food services functions to a private contractor. In 
2019, Congress amended 2 U.S.C. 2051 by requiring that the basic pay 
paid by the food services contractor be treated as ``basic pay'' for 
purposes of retirement provisions. OPM is also correcting an oversight 
related to its publication of rules implementing the provisions of 
section 111 of Public Law 99-500, 100 Stat. 1783-348 (1986). The 
enactment of these provisions similarly allowed House of 
Representatives food services employees to elect to retain CSRS and 
FERS retirement coverage when the House transferred its food services 
functions to a private contractor. OPM's regulations implementing these 
provisions were published at 53 FR 10055 (1988) and were promulgated 
under 5 CFR 831.202. Although OPM's regulations provided rules 
associated with affected former House food services employees covered 
under CSRS, OPM did not publish regulations associated with affected 
former House food services employees under FERS. Because this rule 
proposes to amend OPM's preexisting House food services regulations at 
5 CFR 831.202 to include affected former Senate Restaurants employees 
as a population subject to this regulation, and because OPM is 
proposing equivalent regulations affecting former Senate Restaurants 
employees covered under FERS at 5 CFR 842.110, OPM is proposing to 
clarify that affected former House food services employees covered 
under FERS is also a population subject to the regulations promulgated 
under 5 CFR 842.110.
    The public comment period on the proposed rule ended March 6, 2020. 
OPM received one written comment from a private citizen. The commenter 
stated that he or she did not believe that employees of private 
companies who work in the Capitol building should be given public 
benefits not afforded other employees of private companies. Having 
considered the comment, OPM concluded that it may not adopt the 
commenter's suggestion. Because the retirement benefits afforded to 
parties in this circumstance are permitted by statute, OPM's rules 
implementing those provisions may not alter the statutory provisions 
enacted. As published January 6, 2020, (85 FR 467), the proposed rule 
contains an error that needs to be corrected. The percentage rate under 
Employee Deductions is changed from 1.8 percent to 1.3 percent because 
1.8 percent is a typographical error.
    We added ``Senate Restaurants employees will be covered by Civil 
Service Retirement System Offset for the period of employment with the 
contractor.'' to subpart B-Coverage, Sec.  831.202(a). We wanted to add 
clarification that CSRS employees of the Senate Restaurants who went to 
work for the contractor would be treated as CSRS Offset employees for 
their period of employment with the contractor.

Background

    On October 18, 1986, Congress enacted Public Law 99-500, 100 Stat. 
1783-348 (1986), which allowed food service employees for the House of 
Representatives to elect to retain coverage under CSRS and FERS prior 
to becoming employees of a private contractor after the food services 
operations for the House was transferred to a private contract on 
January 3, 1987. Section 111(c)(1) of this Act provided that OPM must 
publish regulations to implement these provisions. As a result, on 
February 19, 1987, OPM published interim regulations associated with 
this Act at 52 FR 5069 (1987) (promulgated under 5 CFR 831.307). OPM 
did not receive comments on this interim rule, and on March 29, 1988, 
it issued a final rule adopting its interim rule (53 FR 10055 (1988)). 
While OPM's rule promulgated regulations related to former House food 
services employees covered under CSRS, it did not provide equivalent 
regulations for former House food services employees covered under 
FERS.
    Similarly, on September 16, 2008, Senate Restaurants employees of 
the Architect of the Capitol became employees of a private corporation 
after the food services operations for the Senate Restaurants were 
transferred to a private contract. Prior to this transfer, Congress 
enacted Public Law 110-279, 122 Stat. 2604 (2008) (codified at 2 U.S.C. 
2051), which allowed Senate Restaurants employees to elect to retain 
coverage under CSRS and FERS upon transfer. Unlike the 1987 House food 
service employee provisions, the Senate Restaurants employees' 
provisions capped the rate of basic pay of affected Senate Restaurants 
employees at the rates of basic pay they were paid by the

[[Page 20576]]

Architect of the Capitol prior to transfer to the private contract in 
2008.
    On June 12, 2019, Congress enacted technical corrections to the 
2008 Act related to Senate Restaurants employees, removing language 
from 2 U.S.C. 2051(c)(2)(A)(ii) that required OPM to cap the basic pay 
at the rate employees received prior to transfer in 2008. See Public 
Law 116-21, 133 Stat. 903 (2019). The 2019 provisions required OPM to 
begin treating the payments made by the food service contractor as 
``basic pay'' for purposes of retirement provisions.
    On January 6, 2020, OPM published a proposal to ensure 
implementation of Public Law 110-279, 122 Stat. 2604 (2008) and Public 
Law 116-21,133 Stat. 903 (2019). Additionally, OPM is clarifying that 
affected former House food services employees covered under FERS are 
also included as an affected population in accordance with Public Law 
99-500, 100 Stat. 1783-348 (1986).

Employee Deductions

    As employees of a private contractor, House food services and 
Senate Restaurants employees are covered under Social Security. 
Therefore, for those employees covered under CSRS, retirement 
deductions for the Civil Service Retirement and Disability Fund are 
reduced so that the total contribution to the Old-Age, Survivors and 
Disability Insurance (OASDI) portion of Social Security and the Civil 
Service Retirement and Disability Fund does not exceed what affected 
individuals would be contributing as Congressional employees. For 
calendar year 2019, the employee deduction rate for CSRS Offset 
Congressional employees is 1.3 percent of basic pay. FERS-covered 
employees continue to have OASDI taxes as well as the FERS employee 
deduction for Congressional employees withheld from basic pay.

Regulatory Impact Analysis

    OPM has examined the impact of this rule as required by Executive 
Order 12866 and Executive Order 13563, which directs agencies to assess 
all costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public, 
health, and safety effects, distributive impacts, and equity). This 
rule is not a ``significant regulatory action,'' under Executive Order 
12866.

Reducing Regulation and Controlling Regulatory Costs

    This rule is not an E.O. 13771 regulatory action because this rule 
is not significant under E.O. 12866.

Regulatory Flexibility Act

    OPM certifies that this rule will not have a significant economic 
impact on a substantial number of small entities.

Federalism

    We have examined this rule in accordance with Executive Order 
13132, Federalism, and have determined that this rule will not have any 
negative impact on the rights, roles and responsibilities of state, 
local, or tribal governments.

Civil Justice Reform

    This regulation meets the applicable standard set forth in 
Executive Order 12988.

Unfunded Mandates Reform Act of 1995

    This rule will not result in the expenditure by state, local, and 
tribal governments, in the aggregate, or by the private sector, of $100 
million or more in any year and it will not significantly or uniquely 
affect small governments. Therefore, no actions were deemed necessary 
under the provisions of the Unfunded Mandates Reform Act of 1995.

Congressional Review Act

    This action pertains to agency management, personnel, and 
organization and does not substantially affect the rights or 
obligations of nonagency parties and, accordingly, is not a ``rule'' as 
that term is used by the Congressional Review Act (Subtitle E of the 
Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA)). 
Therefore, the reporting requirement of 5 U.S.C. 801 does not apply.

Paperwork Reduction Act

    This rule does not impose any new reporting or record-keeping 
requirements subject to the Paperwork Reduction Act.

List of Subjects

5 CFR Part 831

    Firefighters, Government employees, Income taxes, Intergovernmental 
relations, Law enforcement officers, Pensions, Reporting and 
recordkeeping requirements, Retirement.

5 CFR Part 842

    Air traffic controllers, Alimony, Firefighters, Law enforcement 
officers, Pensions, Retirement.

Office of Personnel Management
Alexys Stanley,
Regulatory Affairs Analyst.

    For the reasons stated in the preamble, the Office of Personnel 
Management amends 5 CFR parts 831 and 842, as follows:

PART 831--RETIREMENT

0
1. The authority citation for part 831 is revised to read as follows:

    Authority: 5 U.S.C. 8347; Sec. 831.102 also issued under 5 
U.S.C. 8334; Sec. 831.106 also issued under 5 U.S.C. 552a; Sec. 
831.108 also issued under 5 U.S.C. 8336(d)(2); Sec. 831.114 also 
issued under 5 U.S.C. 8336(d)(2), and Sec. 1313(b)(5) of Pub. L. 
107-296, 116 Stat. 2135; Sec. 831.201(b)(1) also issued under 5 
U.S.C. 8347(g); Sec. 831.201(b)(6) also issued under 5 U.S.C. 
7701(b)(2); Sec. 831.201(g) also issued under Secs. 11202(f), 
11232(e), and 11246(b) of Pub. L. 105-33, 111 Stat. 251; Sec. 
831.201(g) also issued under Secs. 7(b) and (e) of Pub. L. 105-274, 
112 Stat. 2419; Sec. 831.201(i) also issued under Secs. 3 and 7(c) 
of Pub. L. 105-274, 112 Stat. 2419; Sec. 831.202 also issued under 
Sec. 111 of Pub. L. 99-500, 100 Stat. 1783, and Sec. 111 of Pub. L. 
99-591, 100 Stat. 3341-348, and also Sec. 1 of Pub. L. 110-279, 122 
Stat. 2602, as amended by Sec. 1(a) of Pub. L. 116-21, 133 Stat. 
903; Sec. 831.204 also issued under Sec. 102(e) of Pub. L. 104-8, 
109 Stat. 102, as amended by Sec. 153 of Pub. L. 104-134, 110 Stat. 
1321; Sec. 831.205 also issued under Sec. 2207 of Pub. L. 106-265, 
114 Stat. 784; Sec. 831.206 also issued under Sec. 1622(b) of Pub. 
L. 104-106, 110 Stat. 515; Sec. 831.301 also issued under Sec. 2203 
of Pub. L. 106-265, 114 Stat. 780; Sec. 831.303 also issued under 5 
U.S.C. 8334(d)(2) and Sec. 2203 of Pub. L. 106-235, 114 Stat. 780; 
Sec. 831.502 also issued under 5 U.S.C. 8337, and under Sec. 1(3), 
E.O. 11228, 3 CFR 1965-1965 Comp. p. 317; Sec. 831.663 also issued 
under 5 U.S.C. 8339(j) and (k)(2); Secs. 831.663 and 831.664 also 
issued under Sec. 11004(c)(2) of Pub. L. 103-66, 107 Stat. 412; Sec. 
831.682 also issued under Sec. 201(d) of Pub. L. 99-251, 100 Stat. 
23; Sec. 831.912 also issued under Sec. 636 of Appendix C to Pub. L. 
106-554, 114 Stat. 2763A-164; Subpart P also issued under Sec. 
535(d) of Title V of Division E of Pub. L. 110-161, 121 Stat. 2042; 
Subpart Q also issued under 5 U.S.C. 8336a; Subpart V also issued 
under 5 U.S.C. 8343a and Sec. 6001 of Pub. L. 100-203, 101 Stat. 
1330-275; Sec. 831.2203 also issued under Sec. 7001(a)(4) of Pub. 
Law 101-508, 104 Stat. 1388-328.


0
2. Amend Sec.  831.202 by:
0
a. Revising the section heading;
0
b. Revising paragraphs (a), (b)(1) and (3); and
0
c. Adding paragraphs (e) and (f).
    The additions and revisions to read as follows:

[[Page 20577]]

Sec.  831.202  Continuation of coverage for food service employees of 
the House of Representatives and the Senate Restaurants.

    (a) Congressional employees who were covered by the Civil Service 
Retirement System and provide food service operations for the House of 
Representatives or the Senate Restaurants can elect to continue their 
retirement coverage under subchapter III of chapter 83 of title 5, 
United States Code, when such food service operations are transferred 
to a private contractor. Senate Restaurants employees will be covered 
by Civil Service Retirement System Offset for the period of employment 
with the contractor. These regulations also apply to any successor 
contractors.
    (b) * * *
    (1)(i) Be a Congressional employee (as defined in section 2107 of 
title 5, United States Code), other than an employee of the Architect 
of the Capitol, engaged in providing food service operations for the 
House of Representatives under the administrative control of the 
Architect of the Capitol, or
    (ii) Be a Senate Restaurants employee who is an employee of the 
Architect of the Capitol on July 17, 2008;
* * * * *
    (3) Elect to remain covered under civil service retirement 
provisions no later than the day before the date on which the food 
service operations transfer from the House of Representatives or the 
Senate Restaurants to a private contractor; and
* * * * *
    (e) Beginning with annuity payments commencing on or after April 
14, 2020, the rate of basic pay paid by a Contractor (defined by 2 
U.S.C. 2051(a)(2)) to a covered former Senate Restaurants Employee 
(defined by 2 U.S.C. 2051(a)(1)) for any period of continuous service 
performed as an employee of the contract shall be deemed to be basic 
pay for purposes of 5 U.S.C. 8331(3) and (4).
    (f) The agency contributions and employee deductions that must be 
paid in accordance with 5 U.S.C. 8423 and 2 U.S.C. 2051(c)(6)(A)(ii) 
for the period on or after June 12, 2019, until April 14, 2020 must be 
treated in accordance with Sec.  831.111 of this chapter.

PART 842--FEDERAL EMPLOYEES RETIREMENT SYSTEM-BASIC ANNUITY

0
3. The authority citation for part 842 is revised to read as follows:

    Authority: 5 U.S.C. 8461(g); Secs. 842.104 and 842.106 also 
issued under 5 U.S.C. 8461(n); Sec. 842.104 also issued under Secs. 
3 and 7(c) of Pub. L. 105-274, 112 Stat. 2419; Sec. 842.105 also 
issued under 5 U.S.C. 8402(c)(1) and 7701(b)(2); Sec. 842.106 also 
issued under Sec. 102(e) of Pub. L. 104-8, 109 Stat. 102, as amended 
by Sec. 153 of Pub. L. 104-134, 110 Stat. 1321-102; Sec. 842.107 
also issued under Secs. 11202(f), 11232(e), and 11246(b) of Pub. L. 
105-33, 111 Stat. 251, and Sec. 7(b) of Pub. L. 105-274, 112 Stat. 
2419; Sec. 842.108 also issued under Sec. 7(e) of Pub. L. 105-274, 
112 Stat. 2419; Sec. 842.109 also issued under Sec. 1622(b) of Pub. 
L. 104-106, 110 Stat. 515; Sec. 842.110 also issued under Sec. 111 
of Pub. L. 99-500, 100 Stat. 1783, and Sec. 111 of Pub. L. 99-591, 
100 Stat. 3341-348, and also Sec. 1 of Pub. L. 110-279, 122 Stat. 
2602, as amended by Sec. 1(a) of Pub. L. 116-21, 133 Stat. 903; Sec. 
842.208 also issued under Sec. 535(d) of Title V of Division E of 
Pub. L. 110-161, 121 Stat. 2042; Sec. 842.213 also issued under 5 
U.S.C. 8414(b)(1)(B) and Sec. 1313(b)(5) of Pub. L. 107-296, 116 
Stat. 2135; Secs. 842.304 and 842.305 also issued under Sec. 321(f) 
of Pub. L. 107-228, 116 Stat. 1383, Secs. 842.604 and 842.611 also 
issued under 5 U.S.C. 8417; Sec. 842.607 also issued under 5 U.S.C. 
8416 and 8417; Sec. 842.614 also issued under 5 U.S.C. 8419; Sec. 
842.615 also issued under 5 U.S.C. 8418; Sec. 842.703 also issued 
under Sec. 7001(a)(4) of Pub. L. 101-508, 104 Stat. 1388; Sec. 
842.707 also issued under Sec. 6001 of Pub. L. 100-203, 101 Stat. 
1300; Sec. 842.708 also issued under Sec. 4005 of Pub. L. 101-239, 
103 Stat. 2106 and Sec. 7001 of Pub. L. 101-508, 104 Stat. 1388; 
Subpart H also issued under 5 U.S.C. 1104; Sec. 842.810 also issued 
under Sec. 636 of Appendix C to Pub. L. 106-554 at 114 Stat. 2763A-
164; Sec. 842.811 also issued under Sec. 226(c)(2) of Pub. L. 108-
176, 117 Stat. 2529; Subpart J also issued under Sec. 535(d) of 
Title V of Division E of Pub. L. 110-161, 121 Stat. 2042.


0
4. Add Sec.  842.110 to subpart A to read as follows:

Subpart A--Coverage


Sec.  842.110  Continuation of coverage for food service employees of 
the House of Representatives or the Senate Restaurants.

    (a) Election. Congressional employees who were covered by FERS and 
provide food service operations for the House of Representatives or the 
Senate Restaurants can elect to continue their FERS retirement coverage 
when such food service operations are transferred to a private 
contractor. These regulations also apply to any successor contractors.
    (b) Eligibility requirements. To be eligible for continuation of 
retirement coverage, an employee must:
    (1)(i) Be a Congressional employee (as defined in sec. 2107 of 
title 5, United States Code), other than an employee of the Architect 
of the Capitol, engaged in providing food service operations for the 
House of Representatives under the administrative control of the 
Architect of the Capitol; or
    (ii) Be a Senate Restaurants employee who is an employee of the 
Architect of the Capitol on July 17, 2008;
    (2) Be subject to FERS;
    (3) Elect to remain covered under FERS retirement provisions no 
later than the day before the date on which the food service operations 
transfer from the House of Representatives or the Senate Restaurants to 
a private contractor; and
    (4) Become employed to provide food services under contract without 
a break in service. A ``break in service'' means a separation from 
employment of at least three calendar days.
    (c) Employee deductions. An employee who elects to continue 
coverage under FERS is deemed to consent to deductions from his or her 
basic pay for the Civil Service Retirement and Disability Fund in the 
amount determined in accordance with 5 U.S.C. 8422. The employer 
providing the food services under contract must, in accordance with 
procedures established by OPM, pay into the Civil Service Retirement 
and Disability Fund the amounts deducted from an employee's pay.
    (d) Employer contributions. The employer providing food services 
under contract must, in accordance with procedures established by OPM, 
pay into the Civil Service Retirement and Disability Fund amounts equal 
to any agency contributions under 5 U.S.C. 8423 that would be required 
if the individual were a Congressional employee covered by the Federal 
Employees Retirement System.
    (e) Basic pay of covered former Senate Restaurants Employees. 
Beginning with annuity payments commencing on or after April 14, 2020, 
the rate of basic pay paid by a Contractor (defined by 2 U.S.C. 
2051(a)(2)) to a covered former Senate Restaurants Employee (defined by 
2 U.S.C. 2051(a)(1)) for any period of continuous service performed as 
an employee of the contract shall be deemed to be basic pay for 
purposes of 5 U.S.C. 8401(3)-(4).
    (f) Retroactive agency contributions and employee deductions 
related to covered former Senate Restaurants Employees. The agency 
contributions and employee deductions that must be paid in accordance 
with 5 U.S.C. 8423 and 2 U.S.C. 2051(c)(6)(A)(ii) for the period on or 
after June 12, 2019, until April 14, 2020 must be treated in accordance 
with Sec.  841.505 of this part.

[FR Doc. 2020-07100 Filed 4-13-20; 8:45 am]
 BILLING CODE 6325-23-P