Federal Retirement: Benefits for Members of Congress, Congressional
Staff, and Other Employees (Letter Report, 05/15/95, GAO/GGD-95-78).

Pursuant to a congressional request, GAO compared the retirement
benefits available to members of Congress and congressional staff with
those available to other employees under the Civil Service Retirement
System (CSRS) and the Federal Employees Retirement System (FERS).

GAO found that: (1) CSRS provisions for congressional members are
generally more generous than those for general employees; (2) Members of
Congress, law enforcement officers, firefighters, and air traffic
controllers may retire at a younger age and with fewer years of service
than general and congressional employees; (3) Members, congressional
staff, law enforcement officers, firefighters, and Claims, bankruptcy,
and Military Appeals court judges enjoy a higher benefit formula than
general employees; (4) air traffic controllers are covered by the
general employee benefit formula, but they are guaranteed a minimum
50-percent pension; (5) general employees and Members are subject to
having their pensions reduced if they retire early; (6) some special
employee groups have their premium pay included in their benefit
formulas; (7) employees who receive preferential benefits are required
to make greater payroll contributions; (8) the FERS pension plan has
many of the CSRS advantages for Members, congressional staff, law
enforcement officers, firefighters, and air traffic controllers and has
eliminated or changed some CSRS provisions; and (9) under FERS, law
enforcement officers, firefighters, and air traffic controllers enjoy
provisions similar to those for Members of Congress.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  GGD-95-78
     TITLE:  Federal Retirement: Benefits for Members of Congress, 
             Congressional Staff, and Other Employees
      DATE:  05/15/95
   SUBJECT:  Employee retirement plans
             Federal employees
             Congressional employees
             Comparative analysis
             Retirement benefits
             Eligibility criteria
             Law enforcement personnel
             Fire fighters
             Air traffic controllers
IDENTIFIER:  Civil Service Retirement System
             Federal Employees Retirement System
             Federal Thrift Savings Plan
             
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Cover
================================================================ COVER


Report to Congressional Requesters

May 1995

FEDERAL RETIREMENT - BENEFITS FOR
MEMBERS OF CONGRESS, CONGRESSIONAL
STAFF, AND OTHER EMPLOYEES

GAO/GGD-95-78

Federal Retirement Benefits


Abbreviations
=============================================================== ABBREV

  CSRS - Civil Service Retirement System
  FERS - Federal Employees Retirement System
  MRA - Minimum Retirement Age
  OPM - Office of Personnel Management

Letter
=============================================================== LETTER


B-261183

May 15, 1995

The Honorable Ted Stevens
Chairman, Subcommittee on Post Office
 and Civil Service
Committee on Governmental Affairs
United States Senate

The Honorable John L.  Mica
Chairman, Subcommittee on Civil Service
Committee on Government Reform and Oversight
House of Representatives

At your requests, we are making a series of analyses of federal and
nonfederal retirement programs.  As one aspect of the requests, you
asked that we compare the benefits available to Members of Congress
and congressional staff with those available to other groups of
employees under the Civil Service Retirement System (CSRS) and the
Federal Employees Retirement System (FERS).  This report responds to
that part of your requests. 

CSRS and FERS are, by far, the two largest retirement programs for
federal civilian personnel.  In general, CSRS applies to employees
who entered federal service before December 31, 1983, and FERS
applies to employees who entered after that date.  The two programs
are very different.  CSRS was designed as a "stand-alone" pension
program with no supplementation by Social Security or any other
source of employment-related retirement income.  In fact, CSRS
predates the Social Security system by several years. 

FERS was developed in response to the Social Security Amendments of
1983 that extended Social Security coverage to federal civilian
employees hired after December 1983.  FERS includes (1) a pension
plan; (2) a Thrift Savings Plan to which most employees and the
government contribute; and (3) Social Security, as a three-part
retirement package. 

The Social Security Amendments of 1983 required all Members of
Congress to be covered by Social Security on January 1, 1984,
regardless of when they entered Congress.  Members in CSRS were given
the option of being fully covered by both CSRS and Social Security
and making the employee contributions required by each or
participating in an "offset plan" whereby the Social Security
contributions Members made and any Social Security benefits they
received from their congressional service would be deducted from
their CSRS contributions and benefits, respectively.  A similar
offset plan was applied to all other employees who entered the
government between December 1983, when Social Security coverage began
and CSRS was closed to new entrants, and January 1987, when the FERS
pension plan was implemented. 

CSRS and the FERS pension plan each have a number of separate
provisions for the various employee groups they cover.  Differing
provisions in each plan apply to Members of Congress, congressional
staff, law enforcement officers and firefighters, air traffic
controllers, and all other employees.\1 The latter group (which we
refer to as "general employees") constitutes more than 90 percent of
all employees covered by the plans. 

Appendixes I and II show all the CSRS and FERS provisions that differ
by employee group.  The significant differences are highlighted in
the next sections.  The comparisons do not include several provisions
that are the same for all groups, such as disability retirement and
annuitant cost-of-living adjustments.  Appendixes III and IV
illustrate the benefit amounts that are available to each employee
group at various ages and years of service. 

We derived the information in this report by reviewing chapters 83
and 84 of title 5 of the U.  S.  Code (chapter 83 covers CSRS and
chapter 84 covers the FERS pension plan) and federal regulations on
CSRS and FERS contained in parts 831 through 846 of the Code of
Federal Regulations.  Office of Personnel Management (OPM)
specialists on the two retirement systems reviewed the information we
developed and made certain suggestions for clarification and/or
completeness that we incorporated where appropriate.  Our work was
done during January through April 1995 in accordance with generally
accepted government auditing standards. 


--------------------
\1 Members of Congress and congressional staff can opt out of CSRS
and the FERS pension plan.  Coverage for all other groups is
mandatory. 


   RESULTS IN BRIEF
------------------------------------------------------------ Letter :1

The CSRS provisions for Members of Congress are generally more
beneficial than the provisions for other employee groups,
particularly general employees.  The major differences are found in
the eligibility requirements for retirement and the formulas used to
calculate benefit amounts.  The Member benefit formula applies to
congressional staff; however, congressional staff are covered by the
general employee retirement eligibility requirements.  Law
enforcement officers and firefighters may retire earlier and are
covered by a more generous benefit formula than general employees. 
Under CSRS, the provisions for air traffic controllers fall between
those for law enforcement officers and firefighters and general
employees. 

Many of the relative advantages afforded to Members of Congress and
congressional staff over general employees in CSRS were continued
under the FERS pension plan.  However, provisions for law enforcement
officers, firefighters, and air traffic controllers are very similar
to the Member provisions under FERS.  (Unlike CSRS, the FERS
provisions for air traffic controllers are the same as those for law
enforcement officers and firefighters.)


   CIVIL SERVICE RETIREMENT SYSTEM
------------------------------------------------------------ Letter :2

The CSRS features that differ by employee group are discussed in the
following sections. 


      ELIGIBILITY REQUIREMENTS FOR
      OPTIONAL RETIREMENT
---------------------------------------------------------- Letter :2.1

Members of Congress can retire at younger ages and with fewer years
of service than can general employees and congressional staff. 
General employees and congressional staff are eligible for optional
retirement at age 55 with 30 years of service, at age 60 with 20
years, or at age 62 with 5 years.  Members can retire at the same age
and service combinations but may also retire at age 50 with 20 years
and at any age with 25 years.  Additionally, Members may retire at
age 60 with 10 years of Member service and at age 50 with service in
9 Congresses. 

Law enforcement officers and firefighters may retire at age 50 with
20 years of service as a law enforcement officer or firefighter.  Air
traffic controllers can retire at age 50 with 20 years of air traffic
controller service or at any age with 25 years of air traffic
controller service. 


      RETIREMENT BENEFIT FORMULAS
---------------------------------------------------------- Letter :2.2

The CSRS statute specifies the formulas that will be used in
calculating benefit amounts for the various groups.  For Members of
Congress and congressional staff who have 5 or more years of
congressional service, the formula is 2.5 percent of the average
annual salaries they earned during their 3 consecutive highest-paid
years (known as the "high 3") for each year of congressional service. 
The same benefit formula applies to employees who are federal Claims
Court judges, bankruptcy judges, U.S.  Magistrates, or judges of the
U.S.  Court of Military Appeals.  For example, the formula provides a
benefit of 75 percent of high-3 salary to a Member or congressional
staff with 30 years of congressional service.  In comparison, the
formula for general employees is 1.5 percent of high-3 for each of
the first 5 years of service, 1.75 percent for each of the next 5
years of service, and 2 percent for each year of service greater than
10 years.  The general employee formula provides a benefit of 56.25
percent of high 3 after 30 years of service. 

The benefit formula for law enforcement officers and firefighters is
2.5 percent of high 3 for each of the first 20 years of service and 2
percent for each year of service greater than 20.  Thus, a law
enforcement officer or firefighter who retires at age 50 with 20
years of service would receive 50 percent of high 3.  After 30 years
of service, the benefit would be 70 percent of high 3. 

Air traffic controllers are covered by the general employee benefit
formula, but they are guaranteed to receive no less than 50 percent
of their high 3 at retirement.  To illustrate this point, a
controller who retires at age 50 with 20 years of service receives 50
percent of his or her high 3 because the general employee formula
would provide only 36.25 percent of high 3 after 20 years of service. 
At 25 years of service, a controller would still receive 50 percent
of high 3 because the general employee formula would provide 46.25
percent.  The "break-even" point occurs at just under 27 years of
service when the general employee formula provides about 50 percent
of high 3. 

When Members of Congress retire before age 60, their accrued benefits
are reduced.  The reduction is one-twelfth of 1 percent for each
month (1 percent a year) they are between ages 55 and 60 and
one-sixth of 1 percent for each month (2 percent a year) they are
younger than age 55.  There is no age reduction for any of the other
groups covered by CSRS when they meet the optional retirement
eligibility requirements.  However, the reduction for Members younger
than age 60 does not eliminate the overall advantages of their higher
benefit formula compared with most other employees.  A Member who
retires at age 55 with 30 years of service receives a benefit equal
to 71.25 percent of high 3 rather than the 75 percent he or she would
otherwise receive without the age reduction (1 percent of accrued
benefits for each of the 5 years the retiree is younger than age 60). 
General employees receive 56.25 percent of high 3 at age 55 and 30
years of service.  Since the age reduction does not apply to
congressional staff, they would receive 75 percent. 

Several groups, including law enforcement officers, firefighters,
customs inspectors, and Veteran's Affairs' physicians, receive an
additional advantage in their benefit calculations that is not
afforded to other employee groups.  Their high-3 salaries include
certain types of premium pay.  For example, the high 3 of law
enforcement officers includes pay they receive for administratively
uncontrollable overtime or availability pay.\2 The high-3 amounts for
other groups are limited to basic salaries and do not include any
overtime they may have received. 


--------------------
\2 The administratively uncontrollable overtime program provides
premium pay to employees, primarily law enforcement personnel, in
positions that require substantial amounts of irregular, unscheduled
overtime duty.  For law enforcement officers in the criminal
investigator job series, The Law Enforcement Availability Pay Act of
1994 provides for mandatory payment of 25 percent of base salaries
for working or being available to work an annual average of 2 hours
of unscheduled duty each regular work day. 


      EARLY RETIREMENT
---------------------------------------------------------- Letter :2.3

In certain circumstances, employees may retire before attaining the
requirements for optional retirement or before they intended to
retire.  For example, general employees might be unable to continue
in federal employment because their jobs were abolished or
congressional staff might retire involuntarily if the Members of
Congress who employ them are not reelected.  Also, employees (except
congressional staff) might be given the opportunity to voluntarily
retire early to save the jobs of younger employees when their
agencies are downsizing or transferring functions to other locations. 

CSRS does not include any separate early retirement provisions for
Members of Congress.  The optional retirement provisions apply if a
Member loses an election.  However, some of the age and service
eligibility requirements available to Members for optional retirement
are the same as the early retirement eligibility requirements for
other employees under CSRS. 

General employees and congressional staff may retire early if they
are age 50 with 20 years of service or any age with 25 years of
service.  Benefit amounts are reduced by one-sixth of 1 percent for
each month (2 percent a year) they are younger than age 55.  As
discussed previously, Members may retire optionally at age 50 with 20
years of service, at any age with 25 years, or at age 50 with service
in 9 Congresses (18 years).  Similar to general employees, when
Members retire under these provisions, their benefits are reduced by
2 percent for each year they are younger than age 55.  However,
unlike other employees, Members' benefits are also reduced by 1
percent for each year they are between ages 55 and 60.  Members who
resign or are expelled from Congress cannot receive immediate
benefits unless they are at least age 55 with 30 years of service,
age 62 with 5 years of service, or age 60 with 10 years of Member
service. 

There are no special provisions for law enforcement officers,
firefighters, or air traffic controllers to retire before meeting
their age and service requirements for optional retirement.  In
situations where law enforcement officers, firefighters, or air
traffic controllers might voluntarily retire early or might be
separated involuntarily, the early retirement provisions (including
the benefit formula) used for general employees are applied to these
groups.\3


--------------------
\3 For example, these employees may be age 50 with 20 or more years
of federal service, including service in other occupations but do not
have the 20 years of service as a law enforcement officer,
firefighter, or air traffic controller required for optional
retirement. 


      DEFERRED RETIREMENT
---------------------------------------------------------- Letter :2.4

Many employees do not continue in their federal jobs long enough to
meet the age and service requirements for immediate retirement
benefits.  Employees who quit their jobs before completing 5 years of
service receive no retirement benefits.  Their contributions to the
system are refunded upon request.  Employees who stay longer than 5
years but leave before retirement eligibility may elect to leave
their contributions in the retirement fund and receive their earned
benefits later under the system's deferred retirement provisions. 

The deferred retirement provisions of CSRS are more generous for
Members of Congress than for any other group.  Deferred benefits for
all employees, other than Members, are payable at age 62.  Members
may receive deferred benefits at age 62 if they had at least 5 years
of federal service, but they are also eligible for deferred benefits
at age 60 if they had at least 10 years of Member service or at age
50 if they had 20 years of federal service of which at least 10 were
Member service (with the same benefit reductions as applied to Member
optional retirements before age 60). 

Members of Congress receive another advantage under the deferred
retirement provisions that is not available to any other employee
group.  CSRS provides benefits to the survivors of former Members who
die in the interim between their separation from federal service and
the age at which their deferred annuities would have commenced. 
Other former employees do not have this survivor protection.  If they
die before deferred benefit payments begin, their survivors are not
eligible for survivor benefits.  Rather, the former employees'
contributions to the retirement fund are refunded to the survivors
and no further benefits are payable. 


      MAXIMUM RETIREMENT BENEFITS
---------------------------------------------------------- Letter :2.5

The maximum benefit allowed under CSRS for general employees and
congressional staff is 80 percent of high 3.  For general employees,
about 41 years and 11 months of service are necessary to accrue
benefits equal to 80 percent of high 3.  Congressional staff benefits
reach 80 percent after 32 years of congressional service.  The same
maximum benefit applies to law enforcement officers, firefighters,
and air traffic controllers, but, because of their mandatory
retirement requirements (see pp.  8-9), these employees generally
cannot work long enough to earn benefits of 80 percent of high 3. 

Maximum benefits for Members of Congress are determined somewhat
differently, and this difference is more favorable to Members.  Their
maximum benefit (reached after 32 years of service) is 80 percent of
the greater of their high 3 or final salary as a Member of Congress. 
If a Member leaves Congress to accept an appointive position, the
final salary of that position is used as the basis for the maximum
benefit if it is greater than the former Member's high-3 salary or
final salary as a Member. 


      REEMPLOYMENT OF ANNUITANTS
---------------------------------------------------------- Letter :2.6

In some cases, retirees are reemployed by the government.  The CSRS
provisions covering reemployment of retired Members of Congress are
significantly different from the provisions covering the reemployment
of other retirees. 

In general, retirees (other than retired Members of Congress) who are
reemployed by the government continue to receive their annuities, but
their salaries are reduced by the amount of the annuity.\4 A
reemployed annuitant does not contribute to the retirement fund
unless the individual chooses to have such deductions withheld. 
Reemployment for less than a year does not earn additional retirement
benefits.  However, annuitants reemployed for a year or more in
positions subject to the retirement system are entitled to a
supplemental annuity upon subsequent separation if they make
retroactive contributions or already had deductions withheld.  The
supplemental annuity is based on the salary received during the
reemployment period.  Reemployed annuitants who serve for 5 years or
more may, upon separation, elect to pay their retirement
contributions retroactively (if they had not elected to have them
withheld from pay) and have their annuities recomputed using their
total service and new high-3 salary. 

When retired Members of Congress are reemployed in either elective or
appointive positions, their annuities are suspended, and they again
become covered by the system as if they had not retired.  Reemployed
Member retirees make contributions in the amount required for the
positions they hold.  Upon separation, they receive either (1)
reinstated annuities increased by the cost-of-living adjustments that
occurred during reemployment or (2) recomputed annuities with credit
for their additional service, regardless of the length of the
reemployment.\5


--------------------
\4 The prohibition against receipt of both full salary and annuity
may be waived to deal with an exceptional need to recruit and retain
qualified employees.  These decisions are made on a case-by-case
basis.  The prohibition may also be waived when temporary
reemployment of a retiree is necessary in an emergency involving a
direct threat to life or property or other unusual circumstances. 

\5 The annuity of the former Member is recomputed as if the service
had been performed before separation as a Member. 


      EMPLOYEE CONTRIBUTION
      REQUIREMENTS
---------------------------------------------------------- Letter :2.7

In recognition of the differing retirement provisions for the various
groups, the CSRS statute requires most groups with preferential
benefits to make greater contributions to the retirement fund than
general employees.  General employees and air traffic controllers
contribute 7 percent of their salaries.  Members of Congress
contribute 8 percent, and congressional staff, law enforcement
officers, and firefighters contribute 7.5 percent.  Any employee who
has a premium pay included in the high-3 salary average must also
make contributions from his/her premium pay.  For example, law
enforcement officers must contribute 7.5 percent of their
administratively uncontrollable overtime or availability pay because
these premium payments are included in their high-3 salary averages. 


      OTHER DIFFERENCES IN CSRS
      PROVISIONS FOR MEMBERS,
      CONGRESSIONAL STAFF, AND
      OTHER EMPLOYEES
---------------------------------------------------------- Letter :2.8

General employees, law enforcement officers, firefighters, and air
traffic controllers receive service credit in their benefit
calculations for any full months of unused sick leave they have
accumulated at the time of retirement.  Sick leave is not used in
determining retirement eligibility or high 3.\6 For example, the
benefit amount for a general employee at age 55 with 30 years of
service and 1 year of unused sick leave would be calculated as if the
employee had 31 years of service.  The CSRS statute allows the sick
leave credit only for employees who are covered by a formal leave
system.  Since Members of Congress and most congressional staff are
not under a formal leave system, they cannot receive the sick leave
credit. 

Of all the employee groups covered by CSRS, only law enforcement
officers, firefighters, and air traffic controllers are subject to
mandatory retirement provisions.  Law enforcement officers must
retire by age 57 or as soon thereafter as they complete 20 years of
service.  Firefighters must retire by age 55 or as soon thereafter as
they complete 20 years of service.  Individual employees in both
groups can be retained to age 60 if their agency heads determine it
is in the public interest for them to stay.  The mandatory retirement
age for air traffic controllers is age 56, regardless of their years
of service, and they can be retained to age 61 when the agency head
determines it is in the public interest. 


--------------------
\6 The 80 percent maximum benefit otherwise payable to employees may
be exceeded by application of the sick leave credit.  For example, a
general employee with 1 year of unused sick leave could receive
benefits equal to 82 percent of high 3. 


   FEDERAL EMPLOYEES RETIREMENT
   SYSTEM
------------------------------------------------------------ Letter :3

The basic design of FERS is much different from CSRS.  In addition to
a pension plan, FERS provides Social Security coverage to all
employee groups and includes a Thrift Savings Plan\7 in which all
groups may participate.  The Social Security and thrift plan
provisions do not vary by employee group. 

The FERS pension plan continued the CSRS practice of providing
preferential benefits to Members of Congress, congressional staff,
law enforcement officers, firefighters, and air traffic controllers. 
However, some of the differing benefits under CSRS do not exist in
the FERS pension plan. 

  FERS eliminated the benefit reduction under CSRS that applies to
     Members of Congress who retire before age 60. 

  FERS has no maximum benefit provision.  Thus, the higher maximum
     benefits available to Members of Congress under CSRS do not
     exist in FERS. 

  FERS provides benefits to the survivors of all employees and
     Members who have completed at least 10 years of service and die
     in the interim between their separation from federal service and
     the age at which their deferred annuities would have commenced. 
     CSRS makes this benefit available only to Members of Congress.\8

  FERS does not grant service credit for unused sick leave to any
     employees, thereby not following the CSRS practice of providing
     a sick leave credit for all employee groups other than Members
     of Congress and most congressional staff. 

  FERS eliminated CSRS' preferential treatment of retired Members of
     Congress who become reemployed by the government.  It requires
     that annuities for all reemployed retirees, including Members,
     be continued during the reemployment period but deducted from
     the retirees' salaries.  Any reemployed annuitant, including
     Members, must be reemployed at least 1 year before a
     supplemental annuity is payable and must be reemployed at least
     5 years before the annuity can be recomputed. 

The features of the FERS pension plan that differ by employee group
are discussed in the next section. 


--------------------
\7 For each employee covered by FERS, including Members of Congress,
the government contributes 1 percent of salary to the employee's
Thrift Savings Plan account.  The government contributes additional
amounts to match any contributions the employee makes to the thrift
plan.  The government matches, dollar-for-dollar, employee
contributions up to 3 percent of salary and 50 cents on the dollar
for each of the next 2 percent of salary the employee contributes. 
Employees may contribute another 5 percent of salary to the plan with
no government matching.

Employees in CSRS may also participate in the thrift plan.  They can
contribute up to 5 percent of their salaries to the plan.  However,
the government makes no contributions to their accounts. 

\8 In CSRS, a benefit may be paid to the survivor of a Member who
separated from service but was not yet receiving his/her deferred
annuity if the Member had completed 5 years of service. 


      ELIGIBILITY REQUIREMENTS FOR
      OPTIONAL RETIREMENT
---------------------------------------------------------- Letter :3.1

The FERS pension plan raised the retirement age for general employees
and congressional staff.  It adopted a Minimum Retirement Age (MRA)
concept that gradually increases, from age 55 to age 57, the earliest
age at which general employees and congressional staff are eligible
for optional retirement.\9 However, FERS continued the CSRS practice
of allowing Members of Congress to retire at younger ages and with
fewer years of service than general employees and congressional
staff. 

General employees and congressional staff are eligible to retire at
the MRA with 30 years of service, at age 60 with 20 years, and at age
62 with 5 years.  Members of Congress are eligible to retire at the
same age and service combinations but may also retire at age 50 with
20 years of service or at any age with 25 years. 

FERS allows law enforcement officers, firefighters, and air traffic
controllers to retire at age 50 with 20 years of service or at any
age with 25 years.  In this manner, the eligibility requirements for
all three groups were made the same under FERS.  (Under CSRS,
eligibility to retire at any age with 25 years of service is
available to air traffic controllers only.) FERS also continued the
mandatory retirement requirements and associated provisions in CSRS
for law enforcement officers, firefighters, and air traffic
controllers. 

FERS added a provision not included in CSRS that allows Members of
Congress, congressional staff, and general employees to retire at the
MRA with 10 years of service.  However, the accrued benefits for
persons who retire under this provision are reduced by five-twelfths
of 1 percent for each month (5 percent a year) they are younger than
age 62. 


--------------------
\9 The FERS MRA is age 55 for general employees and congressional
staff born before January 1, 1948.  The MRA gradually increases until
it reaches age 57 for individuals born after December 31, 1969. 


      RETIREMENT BENEFIT FORMULAS
---------------------------------------------------------- Letter :3.2

The benefit formulas for Members of Congress, congressional staff,
law enforcement officers, firefighters, and air traffic controllers
are all the same under the FERS pension plan.  They receive 1.7
percent of their high-3 salaries for each of the first 20 years of
service and 1 percent of high 3 for each year of service over 20
years. 

The FERS benefit formula for general employees is considerably less
beneficial than the formula for the other groups.  Benefits for
general employees who retire before age 62 are calculated at 1
percent of high 3 for each year of service.  To encourage later
retirements, FERS uses a more generous benefit formula for general
employees who retire at age 62 or older with at least 20 years of
service.  These employees' benefits are calculated at 1.1 percent of
high 3 for each year of service. 

To illustrate the effect of the different benefit formulas under the
FERS pension plan, Members of Congress, congressional staff, law
enforcement officers, firefighters, and air traffic controllers would
all receive 44 percent of their high-3 salaries after 30 years of
service.  General employees would receive 30 percent if they were
younger than age 62 and 33 percent if they were age 62 or older. 


      EARLY RETIREMENT
---------------------------------------------------------- Letter :3.3

Like CSRS, the FERS pension plan allows general employees and
congressional staff to retire before attaining the age and service
requirements for optional retirement.  The age and service
requirements for early retirement and the conditions under which
early retirement may be granted are the same as those under CSRS. 
Also like CSRS, FERS does not include any separate early retirement
provisions for Members of Congress, although some of the age and
service requirements available to Members for optional retirement are
the same as the early retirement requirements applicable to general
employees and congressional staff.  FERS also continued the CSRS
practice of not allowing law enforcement officers, firefighters, and
air traffic controllers to retire before meeting their age and
service requirements for optional retirement unless they qualify for
early retirement by adding service in other federal occupations.  In
such cases, the general employee provisions apply. 

A major difference between the CSRS and FERS provisions on early
retirement is that FERS does not require reductions in earned
benefits for employees who retire before attaining optional
retirement eligibility.  While CSRS requires benefits to be reduced
by 2 percent for each year a retiree is younger than age 55, there is
no such reduction in the FERS pension plan. 


      DEFERRED RETIREMENT
---------------------------------------------------------- Letter :3.4

The deferred retirement provisions under the FERS pension plan are
considerably different from CSRS.  The earliest age at which deferred
benefits are available under CSRS, other than for Members of
Congress, is age 62.  However, FERS makes deferred benefits available
to general employees and congressional staff when they would have
qualified for optional retirement if they had not left the
government.  Under FERS, unreduced deferred benefits are paid to
these employees at the MRA if they had at least 30 years of service,
at age 60 if they had at least 20 years, and at age 62 with at least
5 years.  To illustrate this point, an employee who resigns his job
at age 52 after completing 30 years of service is eligible for
deferred benefits at his MRA (age 55 to 57, depending on date of
birth).  Under CSRS, the employee must wait until age 62 for the
deferred benefits to begin. 

The FERS pension plan allows Members of Congress, law enforcement
officers, firefighters, and air traffic controllers to receive
deferred benefits at the same ages and years of service as general
employees if they were not eligible for optional retirement at the
time of separation.  Deferred benefits for law enforcement officers,
firefighters, and air traffic controllers under these circumstances
are calculated under the general employee formula, but Members of
Congress and congressional staff retain their special benefit
formula. 

The FERS pension plan also provides deferred benefits to all groups
at the MRA if they had completed at least 10 years of service. 
Deferred benefit amounts paid in these circumstances are reduced by 5
percent for each year the former employees are younger than age 62. 


      EMPLOYEE CONTRIBUTION
      REQUIREMENTS
---------------------------------------------------------- Letter :3.5

Like CSRS, the FERS pension plan requires the groups with
preferential benefits to make greater contributions to the retirement
fund than general employees.  General employees are required to
contribute 7 percent of their salaries less the Social Security tax
rate (now 6.2 percent), exclusive of Medicare.  The current general
employee contribution rate to the FERS pension plan is 0.8 percent of
salary.  Members of Congress, congressional staff, law enforcement
officers, firefighters, and air traffic controllers must contribute
7.5 percent of salary less their Social Security taxes.  Their
current contribution rate to the FERS pension plan is 1.3 percent of
salary. 


   AGENCY COMMENTS
------------------------------------------------------------ Letter :4

We requested comments on a draft of this report from the Director of
OPM or his designee.  On May 8, 1995, we met with the Chief of the
Retirement Policy Division to discuss the report.  He agreed that the
report accurately portrayed the major features of CSRS and FERS.  He
also suggested certain wording changes that he felt would better
describe the differing provisions for the various employee groups. 
In general, we incorporated the suggested changes. 


---------------------------------------------------------- Letter :4.1

A copy of this report is being sent to Congressman Dan Miller, who
also asked us for information on congressional retirement.  Copies of
the report are also being sent to the Director of OPM and other
parties interested in federal retirement matters and will be made
available to others on request. 

Assistant Director Robert E.  Shelton and Senior Evaluator Laura G. 
Shumway developed the information for this report.  Please contact me
on (202) 512-5074 if you or your staffs have any questions about this
report. 

Nancy R.  Kingsbury
Director
Federal Human Resources
 Management Issues


FEATURES OF THE CIVIL SERVICE
RETIREMENT SYSTEM (CSRS)
=========================================================== Appendix I

This appendix lists CSRS provisions that differ for the various
employee groups they cover.  Not only do the provisions vary by
employee group, but they also vary by the type of retirement.  The
types of retirement shown in table I.1 include: 

  optional retirement in which employees may opt to retire and
     receive an immediate annuity;

  early retirement in which employees may retire and receive an
     immediate annuity before attaining the age and service
     requirements for optional retirement.  The circumstances include
     (1) involuntary separations such as loss of employment through
     job abolishment or reduction-in-force and (2) voluntary
     separations occurring when an agency is undergoing a major
     reorganization, a major reduction-in-force, or a major transfer
     of function where a significant percentage of employees will be
     separated or have their salary grades reduced;\1 and

  deferred retirement in which employees leave federal service before
     qualifying for optional or early retirement, i.e., before
     qualifying for an annuity that can begin immediately.  Their
     annuities are deferred until they reach a specified age. 



                                                                      Table I.1
                                                       
                                                       Features of the Civil Service Retirement
                                                                    System (CSRS)

                                    General federal         Law enforcement officer  Air traffic           Congressional
CSRS features\a                     employee                and firefighter\b        controller\b          staff\c               Member of Congress\c
----------------------------------  ----------------------  -----------------------  --------------------  --------------------  --------------------
Optional retirement
-----------------------------------------------------------------------------------------------------------------------------------------------------
Age and service requirements        Age 55, 30 years        Age 50, 20 years as law  Age 50, 20 years as   Same as general       Age 60, 10 years of
                                                            enforcement officer or   an air traffic        employees\d           Member service
                                    Age 60, 20 years        firefighter              controller
                                                                                                                                 Age 62, 5 years
                                    Age 62, 5 years                                  Any age, 25 years as
                                                                                     an air traffic                              Age 55, 30 years
                                                                                     controller                                  (with reduction)

                                                                                                                                 Age 50, 20 years
                                                                                                                                 (with reduction)\e

                                                                                                                                 Any age, 25 years
                                                                                                                                 (with reduction)\e

                                                                                                                                 Age 50, service in
                                                                                                                                 nine Congresses
                                                                                                                                 (with reduction)\e

Formula for determining the         1.5% of high 3\f for    2.5% of high 3\g for     Higher of amount      If less than 5 years  Same as
annuity amount                      each of first 5 years   each of first 20 years   produced by the       of congressional      congressional staff
                                                            as law enforcement       general employee      service, same as      formula, except that
                                    1.75% of high 3 for     officer or firefighter   formula or 50% of     general employee      military service
                                    each of next 5 years                             high 3                formula               performed while on
                                                                                                                                 leave of absence as
                                    2% of high 3 for each   2% of high 3 for each                          If 5 or more years    a Member during
                                    year over 10 years      year over 20 years as                          of congressional      wartime or national
                                                            law enforcement officer                        service:              emergency is not
                                                            or firefighter and any                                               subject to the
                                                            other federal service                          2.5% of high 3 for    maximum 5 years'
                                                                                                           each year of          military service
                                                                                                           congressional         creditable under the
                                                                                                           service and up to 5   2.5% multiplier
                                                                                                           years' military
                                                                                                           service,

                                                                                                           2% of high 3 for
                                                                                                           each year of other
                                                                                                           noncongressional
                                                                                                           federal service\h

Reduction in annuity amount         None                    None                     None                  None                  None at age 60 and
                                                                                                                                 older

                                                                                                                                 Annuity reduced by
                                                                                                                                 one-twelfth of 1%
                                                                                                                                 for each month
                                                                                                                                 Member is between
                                                                                                                                 ages 55 and 60 (1% a
                                                                                                                                 year) and by one-
                                                                                                                                 sixth of 1% for each
                                                                                                                                 month Member is
                                                                                                                                 under age 55 (2% a
                                                                                                                                 year)

Maximum benefit allowed             80% of high 3,          80% of high 3,           80% of high 3,        80% of high 3         80% of the greater
                                    excluding credit for    excluding credit for     excluding credit for                        of:
                                    unused sick leave\i     unused sick leave        unused sick leave                           -final basic pay of
                                                                                                                                 the Member,
                                                                                                                                 -high 3 of the
                                                                                                                                 Member, or
                                                                                                                                 -final basic pay of
                                                                                                                                 the appointive
                                                                                                                                 position of a former
                                                                                                                                 Member


Early retirement\j
-----------------------------------------------------------------------------------------------------------------------------------------------------
Age and service requirements        Age 50, 20 years        Same as general          Same as general       Same as general       None. See optional
                                                            employees                employees             employees\d           and deferred
                                    Any age, 25 years                                                                            retirement
                                                            (with reduction if       (with reduction if                          provisions
                                    (with reduction if      under age 55)            under age 55)
                                    under age 55)

Formula for determining the         Same as optional        Same as general          Same as general       Same as optional      None
annuity amount                      retirement formula      employee formula with    employee formula      retirement formula
                                    with reduction if       reduction if under age   with reduction        with reduction if
                                    under age 55            55                                             under age 55

Reduction in annuity amount         Annuity reduced by      Annuity reduced as       Annuity reduced as    Annuity reduced as    None
                                    one-sixth of 1% for     general employees        general employees     general employees
                                    each month the
                                    employee is under age
                                    55 (2% a year)


Deferred retirement\k
-----------------------------------------------------------------------------------------------------------------------------------------------------
Age and service requirements        Annuity payable when    Same as general          Same as general       Same as general       Annuity payable when
                                    former employee         employees                employees             employees             former Member
                                    reaches age 62 with at                                                                       reaches:
                                    least 5 years of
                                    service                                                                                      -age 62 with at
                                                                                                                                 least 5 years of
                                                                                                                                 service
                                                                                                                                 -age 60 with at
                                                                                                                                 least 10 years of
                                                                                                                                 Member service
                                                                                                                                 -age 50 with at
                                                                                                                                 least 20 years of
                                                                                                                                 federal service,
                                                                                                                                 including at least
                                                                                                                                 10
                                                                                                                                 years Member service
                                                                                                                                 (with reduction)\e

Formula for determining the         Same as optional        Same as general          Same as general       Same as optional      Same as optional
annuity amount                      retirement formula      employee formula         employee formula      retirement formula    retirement formula

Reduction in annuity amount         None                    None                     None                  None                  Same as optional
                                                                                                                                 retirement

Survivor benefit                    Refund of               Same as general          Same as general       Same as general       Immediate survivor
                                    contributions if        employees                employees             employees             annuity upon death
                                    former employee dies                                                                         of former Member
                                    before deferred
                                    annuity begins


Other features
-----------------------------------------------------------------------------------------------------------------------------------------------------
Employee contribution rate          7% of salary            7.5% of salary           7% of salary          7.5% of salary        8% of salary

Mandatory retirement age            None                    Law enforcement          Air traffic           None                  None
                                                            officers must retire at  controllers must
                                                            age 57 or as soon        retire at age 56,
                                                            thereafter as they       regardless of years
                                                            complete 20 years of     of service\m
                                                            service\l

                                                            Firefighters must
                                                            retire at age 55 or as
                                                            soon thereafter as they
                                                            complete 20 years of
                                                            service\l

Reemployment of annuitants\n        Annuity continues upon  Same as general          Same as general       Same as general       Annuity suspended
                                    reemployment, but the   employees                employees             employees             upon reemployment
                                    salary is reduced by                                                                         and Member again
                                    the amount of the                                                                            makes required
                                    annuity                                                                                      contributions

                                    as long as required                                                                          Upon separation, the
                                    contributions are                                                                            annuity recommences
                                    made\o an individual                                                                         and is either (1)
                                    employed:                                                                                    recomputed with
                                                                                                                                 credit for
                                    -at least one year                                                                           additional service
                                    can                                                                                          regardless of how
                                    receive a                                                                                    long the Member was
                                    supplemental                                                                                 reemployed or (2)
                                    annuity upon                                                                                 reinstated with the
                                    separation, and                                                                              cost-of-living
                                    -at least five years                                                                         adjustments that
                                    can have                                                                                     occurred during
                                    the annuity recomputed                                                                       reemployment
                                    based
                                    on total service and a
                                    new
                                    high 3
-----------------------------------------------------------------------------------------------------------------------------------------------------

\a In general, employees or Members must have at least 5 years of
federal civilian service to receive any CSRS benefits.  The CSRS
features that are the same for all employee groups are not included
in this table.  These features include disability retirement,
cost-of-living adjustments, etc.  The CSRS was closed to new hires as
of January 1, 1984. 

\b In order to qualify for the special retirement benefits granted to
law enforcement officers, firefighters, and air traffic controllers,
an employee must be (1) age 50 and have served at least 20 years as a
law enforcement officer, firefighter, or air traffic controller, or
(2)any age and have served at least 25 years as an air traffic
controller.  Otherwise, the general employee provisions apply. 

\c Congressional staff and Members have the option of not
participating in CSRS.  Beginning in 1984, Members were required to
pay Social Security taxes regardless of whether they participated in
CSRS. 

\d According to OPM records, 50-60 percent of congressional staff who
had retired from Congress with immediate nondisability annuities and
were on the CSRS retirement rolls as of October 1, 1994, retired
involuntarily under the early retirement provision.  About 10 percent
of general employees who had retired with immediate nondisability
annuities retired involuntarily. 

\e Members cannot receive an annuity under these age and service
requirements if they resign or are expelled from Congress. 

\f The high 3 is the largest annual rate resulting from averaging an
employee's or Member's rates of basic pay in effect over any 3
consecutive years of creditable service. 

\g The high 3 for law enforcement officers includes availability pay
or pay for administratively uncontrollable overtime. 

\h For congressional staff with at least 5 but fewer than 10 years of
congressional and military service calculated at the 2.5% formula, a
1.75% multiplier is applied to each year of other noncongressional
federal service until the total of congressional and noncongressional
service reaches 10 years.  The 2% multiplier is then applied to all
other noncongressional federal service.  If the 2.5% service is 10
years or greater, the 1.75% multiplier is not used and the 2%
multiplier is applied to all noncongressional federal service. 

\i Under CSRS, an employee's full months of unused sick leave
accumulated under a formal leave system is included in the total
years and months of creditable service but not in determining
retirement eligibility or the high 3.  Members and most congressional
staff do not have a formal leave system. 

\j Employees who are fired for cause cannot receive an early
retirement annuity.  They must wait until age 62 to receive benefits. 

\k To be eligible for deferred retirement, employees or Members must
not have received refunds of all their contributions to the
retirement fund. 

\l Law enforcement officers and firefighters may be retained to age
60 when the agency head believes the public interest requires that
they stay. 

\m Air traffic controllers may be retained to age 61 when the agency
head believes the public interest requires that they stay. 

\n Under special circumstances such as exceptional difficulties
recruiting and retaining qualified employees or when a direct threat
to life and property exists, the provisions to deduct the annuity
from the salary of a reemployed annuitant, to not recompute an
annuity for fewer than 5 years additional service, to withhold
contributions, or to suspend the annuity of a reemployed Member may
be waived on a case-by-case basis. 

\o Reemployed annuitants may elect to have the required contributions
withheld from their pay or to pay the contributions retroactively. 

Source:  Chapter 83 of title 5 of the United States Code and parts
831 through 838 of the Code of Federal Regulations. 


--------------------
\1 Early retirement, both voluntary and involuntary, is not available
to Members of Congress.  Early voluntary retirement is not available
to congressional staff. 


FEATURES OF THE FEDERAL EMPLOYEES
RETIREMENT SYSTEM (FERS)
========================================================== Appendix II

This appendix lists FERS provisions that differ for the various
employee groups they cover.  Not only do the provisions vary by
employee group, but they also vary by the type of retirement.  The
types of retirement shown in table II.1 include: 

  optional retirement in which employees may opt to retire and
     receive an immediate annuity;

  early retirement in which employees may retire and receive an
     immediate annuity before attaining the age and service
     requirements for optional retirement.  The circumstances include
     (1) involuntary separations such as loss of employment through
     job abolishment or reduction-in-force and (2) voluntary
     separations occurring when an agency is undergoing a major
     reorganization, a major reduction-in-force, or a major transfer
     of function where a significant percentage of employees will be
     separated or have their salary grades reduced;\1 and

  deferred retirement in which employees leave federal service before
     qualifying for optional or early retirement, i.e., before
     qualifying for an annuity that can begin immediately.  Their
     annuities are deferred until they reach a specified age. 



                                                                      Table II.1
                                                       
                                                          Features of the Federal Employees
                                                               Retirement System (FERS)

                                    General federal         Law enforcement officer  Air traffic           Congressional
FERS features\a                     employee                and firefighter\b        controller\b          staff\c               Member of Congress\c
----------------------------------  ----------------------  -----------------------  --------------------  --------------------  --------------------
Optional retirement
-----------------------------------------------------------------------------------------------------------------------------------------------------
Age and service requirements        MRA\d, 30 years         Age 50, 20 years as a    Age 50, 20 years as   Same as general       MRA, 30 years
                                                            law enforcement officer  an air traffic        employees
                                    Age 60, 20 years        or firefighter           controller                                  Age 60, 20 years

                                    Age 62, 5 years         Any age, 25 years as a   Any age, 25 years as                        Age 62, 5 years
                                                            law enforcement officer  an air traffic
                                    MRA, 10 years (with     or firefighter           controller                                  Age 50, 20 years\e
                                    reduction)
                                                                                                                                 Any age, 25 years\e

                                                                                                                                 MRA, 10 years (with
                                                                                                                                 reduction)

Formula for determining the         1.1% of high 3\f for    1.7% of high-3\g for     1.7% of high-3 for    If less than 5 years  Same as
annuity amount                      each year of service    each of first 20 years   each of first 20      of congressional      congressional staff
                                    if age 62 or older      as law enforcement       years as air traffic  service, same as      formula
                                    with 20 years           officer or firefighter   controller            general employee
                                                                                                           formula
                                    1% of high-3 for each   1% of high-3 for each    1% of high-3 for
                                    year of service if      year over 20 years as    each year over 20     If 5 or more years
                                    under age 62, or age    law enforcement officer  years as air traffic  of congressional
                                    62 or older with less   or firefighter and any   controller and any    service:
                                    than 20 years           other federal service    other federal
                                                                                     service               1.7% of high-3 for
                                                                                                           each of first 20
                                                                                                           years of
                                                                                                           congressional
                                                                                                           service

                                                                                                           1% of high-3 for
                                                                                                           each year over 20
                                                                                                           years of
                                                                                                           congressional
                                                                                                           service and any
                                                                                                           other federal
                                                                                                           service (including
                                                                                                           military service)

Reduction in annuity amount         None at ages MRA and    None                     None                  Same as general       None at ages MRA and
                                    30 years, age 60 and                                                   employees             30 years, age 60 and
                                    20 years, or age 62                                                                          20 years, age 62 and
                                    and 5 years                                                                                  5 years, age 50 and
                                                                                                                                 20 years, or any age
                                    For employee retiring                                                                        and 25 years
                                    at MRA and 10 years,
                                    annuity reduced by                                                                           For Member retiring
                                    five-twelfths of 1%                                                                          at MRA and 10 years,
                                    for each month                                                                               annuity reduced by
                                    employee is under age                                                                        five-twelfths of 1%
                                    62 (5% a year)                                                                               for each month
                                                                                                                                 Member is under age
                                                                                                                                 62 (5% a year)

Maximum benefit allowed             None                    None                     None                  None                  None


Early retirement\h
-----------------------------------------------------------------------------------------------------------------------------------------------------
Age and service requirements        Age 50, 20 years        Same as general          Same as general       Same as general       None. See optional
                                                            employees                employees             employees             and deferred
                                    Any age, 25 years                                                                            retirement
                                                                                                                                 provisions

Formula for determining the         Same as optional        Same as general          Same as general       Same as optional      None
annuity amount                      retirement formula      employee formula         employee formula      retirement formula

Reduction in annuity amount         None                    None                     None                  None                  None


Deferred retirement\i
-----------------------------------------------------------------------------------------------------------------------------------------------------
Age and service requirements        Annuity payable when    Same as general          Same as general       Same as general       Same as general
                                    former employee         employees                employees             employees             employees
                                    reaches the age
                                    requirement for
                                    optional retirement:

                                    -MRA with at least 30
                                    years
                                    -age 60 with at least
                                    20 years
                                    -age 62 with at least
                                    5 years
                                    -MRA with at least 10
                                    years
                                    (with reduction)

Formula for determining the         Same as optional        Same as general          Same as general       Same as optional      Same as optional
annuity amount                      retirement formula      employee formula         employee formula      retirement formula    retirement formula

Reduction in annuity amount         None at age 62, age 60  Same as general          Same as general       Same as general       Same as general
                                    and 20 years, or MRA    employees                employees             employees             employees
                                    and 30 years

                                    For MRA and 10 years,
                                    annuity reduced by
                                    five-twelfths of 1%
                                    for each month the
                                    former employee is
                                    under age 62 (5% a
                                    year)

Survivor benefit                    If at least 10 years    Same as general          Same as general       Same as general       Same as general
                                    of service, annuity     employees                employees             employees             employees
                                    begins on the day
                                    after the former
                                    employee would have
                                    been

                                    -age 62, if less than
                                    20 years
                                    service
                                    -age 60, if 20 through
                                    29 years
                                    service
                                    -MRA, if 30 or more
                                    years
                                    service

                                    Alternatively, annuity
                                    can begin the day
                                    after death, but
                                    annuity computed
                                    actuarially equivalent
                                    to waiting for above
                                    age and service
                                    combinations


Other features
-----------------------------------------------------------------------------------------------------------------------------------------------------
Employee contribution rate          Currently 0.8% of       Currently 1.3% of        Same as law           Same as law           Same as law
                                    salary (7% of salary    salary (7.5% of salary   enforcement officers  enforcement officers  enforcement officers
                                    less the Social         less the Social          and firefighters      and firefighters      and firefighters
                                    Security tax rate,      Security tax rate,
                                    other than Medicare)    other than Medicare)

Mandatory retirement age            None                    Law enforcement          Air traffic           None                  None
                                                            officers must retire at  controllers must
                                                            age 57 or as soon        retire at age 56 or
                                                            thereafter as they       as soon thereafter
                                                            complete 20 years of     as they complete 20
                                                            service\j                years of service\k

                                                            Firefighters must
                                                            retire at age 55 or as
                                                            soon thereafter as they
                                                            complete 20 years of
                                                            service\j

Reemployment of annuitants\l        Annuity continues upon  Same as general          Same as general       Same as general       Same as general
                                    reemployment, but the   employees                employees             employees             employees
                                    salary is reduced by
                                    the amount of the
                                    annuity

                                    As long as required
                                    contributions are
                                    made\m, an individual
                                    employed:

                                    -at least one year can
                                    receive
                                    a supplemental annuity
                                    upon
                                    separation, and
                                    -at least five years
                                    can have
                                    the annuity recomputed
                                    based
                                    on total service and a
                                    new
                                    high 3 upon separation
-----------------------------------------------------------------------------------------------------------------------------------------------------

\a In general, employees or Members must have at least 5 years of
federal civilian service to receive FERS benefits.  The FERS features
that are the same for all employee groups are not included in this
table.  These features include disability retirement, cost-of-living
adjustments, etc. 

\b In order to qualify for the special retirement benefits granted to
law enforcement officers, firefighters, and air traffic controllers,
an employee must be (1) age 50 and have served at least 20 years as
either a law enforcement officer, firefighter, or air traffic
controller, or (2) any age and have served at least 25 years as
either a law enforcement officer, firefighter, or air traffic
controller.  Otherwise, the general employee provisions apply. 

\c Congressional staff and Members have the option of not
participating in FERS.  Beginning in 1984, Members and newly hired
congressional staff must pay Social Security taxes regardless of
whether they participate in FERS. 

\d MRA is the minimum retirement age.  The MRA is age 55 for an
individual born before January 1, 1948, and gradually increases until
it reaches age 57 for employees born after December 31, 1969.  For
example, an individual born in 1950 has a MRA of 55 years and 6
months. 

\e Members cannot receive an annuity under these age and service
requirements if they resign or are expelled from Congress. 

\f The high 3 is the largest annual rate resulting from averaging an
employee's or Member's rates of basic pay in effect over any 3
consecutive years of creditable service. 

\g The high 3 for law enforcement officers includes availability pay
or pay for administratively uncontrollable overtime. 

\h Employees who are fired for cause cannot receive an early
retirement annuity.  They must wait until they meet the age and
service requirements for deferred annuities. 

\i To be eligible for deferred retirement, employees or Members must
not have received refunds of all their contributions to the
retirement fund. 

\j Law enforcement officers and firefighters may be retained to age
60 when the agency head believes the public interest requires that
they stay. 

\k Air traffic controllers may be retained to age 61 when the agency
head believes the public interest requires that they stay. 

\l Under special circumstances, such as exceptional difficulty
recruiting and retaining qualified employees or a direct threat to
life and property exists, the provisions to deduct the annuity from
the salary of a reemployed annuitant, to not recompute an annuity for
fewer than 5 years of additional service, or to withhold
contributions may be waived on a case-by-case basis. 

\m In FERS, deductions are withheld from reemployed annuitants' pay. 

Source:  Chapter 84 of title 5 of the United States Code and parts
841 through 846 of the Code of Federal Regulations. 


--------------------
\1 Early retirement, both voluntary and involuntary, is not available
to Members of Congress.  Early voluntary retirement is not available
to congressional staff. 


DATA ON CSRS ANNUITY LEVELS
========================================================= Appendix III

   Figure III.1:  Maximum CSRS
   Annuities Immediately Available
   to Employee Groups Under the
   Optional Retirement Provisions

   (See figure in printed
   edition.)

Note 1:  The CSRS optional retirement provisions are described in
appendix I.  Under these provisions an individual may voluntarily
retire with an immediate annuity, which may be unreduced or reduced
depending on his/her age and years of service at the time of
retirement.  Special early out voluntary retirements, disability
retirements, and involuntary retirements are not considered optional. 

Note 2:  These bars represent the maximum percentage of high-3 that
is available at the years of service shown.  The ages required to
obtain these maximum percentages vary by group. 

Note 3:  The percentages shown above the bars are rounded.  For
example, the 56 percent shown for general federal employees and air
traffic controllers at 30 years of service is actually 56.25 percent. 

   Figure III.2:  CSRS Annuities
   Immediately Available at Age 50
   for Employee Groups Under the
   Optional Retirement Provisions

   (See figure in printed
   edition.)

Note 1:  A missing bar means the employee group cannot retire at that
age and years of service under the optional retirement provisions. 

Note 2:  The percentages shown above the bars are rounded.  For
example, the 56 percent shown for air traffic controllers at 30 years
of service is actually 56.25 percent. 

   Figure III.3:  CSRS Annuities
   Immediately Available at Age 55
   for Employee Groups Under the
   Optional Retirement Provisions

   (See figure in printed
   edition.)

Note 1:  A missing bar means the employee group cannot retire at that
age and years of service under the optional retirement provisions. 

Note 2:  The percentages shown above the bars are rounded.  For
example, the 56 percent shown for general federal employees and air
traffic controllers at 30 years of service is actually 56.25 percent. 

   Figure III.4:  CSRS Annuities
   Immediately Available at Age 60
   for Employee Groups Under the
   Optional Retirement Provisions

   (See figure in printed
   edition.)

Note 1:  A missing bar means the employee group cannot retire at that
age and years of service under the optional retirement provisions. 

Note 2:  The percentages shown above the bars are rounded.  For
example, the 56 percent shown for general federal employees at 30
years of service is actually 56.25 percent. 

Note 3:  Law enforcement officers, firefighters, and air traffic
controllers are not shown in this figure.  In most cases, they have
already retired because of their mandatory retirement ages. 

   Figure III.5:  CSRS Annuities
   Immediately Available at Age 62
   for Employee Groups Under the
   Optional Retirement Provisions

   (See figure in printed
   edition.)

Note 1:  The percentages shown above the bars are rounded.  For
example, the 56 percent shown for general federal employees at 30
years of service is actually 56.25 percent. 

Note 2:  Law enforcement officers, firefighters, and air traffic
controllers are not shown in this figure.  In most cases, they have
already retired because of their mandatory retirement ages. 


DATA ON FERS ANNUITY LEVELS
========================================================== Appendix IV

   Figure IV.1:  Maximum FERS
   Annuities Immediately Available
   to Employee Groups Under the
   Optional Retirement Provisions

   (See figure in printed
   edition.)

Note 1:  The FERS optional retirement provisions are described in
appendix II.  Under these provisions an individual may voluntarily
retire with an immediate annuity, which may be unreduced or reduced
depending on his/her age and years of service at the time of
retirement.  Special early out voluntary retirements, disability
retirements, and involuntary retirements are not considered optional. 

Note 2:  These bars represent the maximum percentage of high-3 that
is available at the years of service shown.  The ages required to
obtain these maximum percentages vary by group. 

Note 3:  The percentages shown above the bars are rounded.  For
example, the 9 percent shown for Members of Congress at 5 years of
service is actually 8.5 percent. 

Note 4:  If a general federal employee is age 62 with at least 20
years of service, the percentages are 22 percent with 20 years, 27.5
percent with 25 years, 33 percent with 30 years, and 38.5 percent
with 35 years, because the multiplier increases from 1 percent for
each year of service to 1.1 percent for each year of service. 

   Figure IV.2:  FERS Annuities
   Immediately Available at Age 50
   for Employee Groups Under the
   Optional Retirement Provisions

   (See figure in printed
   edition.)

Note 1:  A missing bar means the employee group cannot retire at that
age and years of service under the optional retirement provisions

   Figure IV.3:  FERS Annuities
   Immediately Available at Age 55
   for Employee Groups Under the
   Optional Retirement Provisions

   (See figure in printed
   edition.)

Note 1:  A missing bar means the employee group cannot retire at that
age and years of service under the optional retirement provisions. 

Note 2:  The percentages shown above the bars are rounded.  For
example, the 7 percent shown for general federal employees at 10
years of service is actually 6.5 percent. 

   Figure IV.4:  FERS Annuities
   Immediately Available at Age 60
   for Employee Groups Under the
   Optional Retirement Provisions

   (See figure in printed
   edition.)

Note 1:  A missing bar means the employee group cannot retire at that
age and years of service under the optional retirement provisions. 

Note 2:  The percentages shown above the bars are rounded.  For
example, the 15 percent shown for Members of Congress at 10 years of
service is actually 15.3 percent. 

Note 3:  Law enforcement officers, firefighters, and air traffic
controllers are not shown in this figure.  In most cases, they have
already retired because of their mandatory retirement ages. 

   Figure IV.5:  FERS Annuities
   Immediately Available at Age 62
   for Employee Groups Under the
   Optional Retirement Provisions

   (See figure in printed
   edition.)

Note 1:  The percentages shown above the bars are rounded.  For
example, the 9 percent shown for Members of Congress at 5 years of
service is actually 8.5 percent. 

Note 2:  Law enforcement officers, firefighters, and air traffic
controllers are not shown in this figure.  In most cases, they have
already retired because of their mandatory retirement ages. 
