[Federal Register Volume 88, Number 72 (Friday, April 14, 2023)]
[Notices]
[Pages 23109-23111]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-07878]


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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 the economic and demographic assumptions 
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, 2023.

ADDRESSES: Send requests for actuarial assumptions and data to the 
Board of Actuaries, care of Gregory Kissel, Senior Actuary, Office of 
Healthcare and Insurance, Office of Personnel Management, Room 4316, 
1900 E Street NW, Washington, DC 20415, or by email to [email protected].

FOR FURTHER INFORMATION CONTACT: Karla Yeakle, (202) 606-0299.

SUPPLEMENTARY INFORMATION: Several provisions of the Federal Employees' 
Retirement System (FERS) require 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

[[Page 23110]]

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, 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.
    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. Subpart I of part 
847 of title 5, Code of Federal Regulations, prescribes the use of 
present value factors for employees that elect to credit 
nonappropriated fund instrumentality service to qualify for immediate 
retirement under section 1132 of Public Law 107-107.
    OPM published the present value factors currently in effect on 
March 29, 2021, at 86 FR 16398. On April 14, 2023, OPM published a 
notice to revise the normal cost percentage under the Federal 
Employees' Retirement System (FERS) Act of 1986, Public Law 99-335, 
based on changed assumptions 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, 2023, 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, 2023. See 5 CFR 842.706. For 
survivor election deposits, the new factors will apply to survivor 
reductions that commence on or after October 1, 2023. 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 or 847.809 
is on or after October 1, 2023. See 5 CFR 842.602, 842.616, 847.603, 
and Sec.  847.809.
    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), Sec.   8420a, under section 1043 of Public
        Law 104-106, or under section 1132 of Public Law 107-107]
------------------------------------------------------------------------
                                                           Present value
                           Age                                factor
------------------------------------------------------------------------
62......................................................           226.5
63......................................................           219.9
64......................................................           213.2
65......................................................           206.4
66......................................................           199.6
67......................................................           192.7
68......................................................           185.8
69......................................................           178.9
70......................................................           171.9
71......................................................           165.0
72......................................................           158.1
73......................................................           151.2
74......................................................           144.3
75......................................................           137.5
76......................................................           130.8
77......................................................           124.2
78......................................................           117.7
79......................................................           111.3
80......................................................           105.0
81......................................................            98.8
82......................................................            92.9
83......................................................            87.1
84......................................................            81.5
85......................................................            76.1
86......................................................            71.0
87......................................................            66.0
88......................................................            61.3
89......................................................            56.8
90......................................................            52.6
91......................................................            48.7
92......................................................            45.1
93......................................................            41.8
94......................................................            38.8
95......................................................            36.1
96......................................................            33.6
97......................................................            31.4
98......................................................            29.4
99......................................................            27.7
100.....................................................            26.2
101.....................................................            24.8
102.....................................................            23.5
103.....................................................            22.2
104.....................................................            20.8
105.....................................................            19.3
106.....................................................            17.3
107.....................................................            14.4
108.....................................................             9.5
109.....................................................             6.4
------------------------------------------------------------------------


      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.
  8416(b), 8416(c), 8417(b), Sec.   8420a, under section 1043 of Public
        Law 104-106, or under section 1132 of Public Law 107-107]
------------------------------------------------------------------------
                                                           Present value
                           Age                                factor
------------------------------------------------------------------------
40......................................................           271.7
41......................................................           270.3
42......................................................           268.7
43......................................................           267.1
44......................................................           265.4
45......................................................           263.7
46......................................................           261.8
47......................................................           259.9
48......................................................           257.9
49......................................................           255.9
50......................................................           253.9
51......................................................           251.9
52......................................................           249.7
53......................................................           247.6
54......................................................           245.4
55......................................................           243.1
56......................................................           240.8
57......................................................           238.5
58......................................................           236.1
59......................................................           233.8
60......................................................           231.4
61......................................................           229.0
------------------------------------------------------------------------


      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 Sec.   8420a, under section 1043 of Public
        Law 104-106, or under section 1132 of Public Law 107-107]
------------------------------------------------------------------------
                                                           Present value
                           Age                                factor
------------------------------------------------------------------------
40......................................................           355.7
41......................................................           350.7
42......................................................           345.7
43......................................................           340.5
44......................................................           335.3
45......................................................           329.9
46......................................................           324.4
47......................................................           318.7
48......................................................           313.0
49......................................................           307.3
50......................................................           301.5
51......................................................           295.7
52......................................................           289.7
53......................................................           283.7
54......................................................           277.6
55......................................................           271.4
56......................................................           265.2
57......................................................           258.9
58......................................................           252.6
59......................................................           246.1
60......................................................           239.7
61......................................................           233.1
------------------------------------------------------------------------


[[Page 23111]]


 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 or under section 1132 of Public Law 107-107]
------------------------------------------------------------------------
                                                           Present value
                   Age at calculation                      of a monthly
                                                              annuity
------------------------------------------------------------------------
17......................................................           443.3
18......................................................           440.3
19......................................................           437.2
20......................................................           434.1
21......................................................           431.0
22......................................................           427.7
23......................................................           424.4
24......................................................           421.0
25......................................................           417.6
26......................................................           414.1
27......................................................           410.5
28......................................................           406.8
29......................................................           403.0
30......................................................           399.2
31......................................................           395.2
32......................................................           391.2
33......................................................           387.1
34......................................................           382.9
35......................................................           378.6
36......................................................           374.2
37......................................................           369.7
38......................................................           365.2
39......................................................           360.5
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Office of Personnel Management.
Stephen Hickman,
Federal Register Liaison.
[FR Doc. 2023-07878 Filed 4-13-23; 8:45 am]
BILLING CODE 6325-38-P