- The Washington Times - Tuesday, January 7, 2003

Each new Congress theoretically starts out with a clean slate. But for federal employees, postal workers and retired feds the usual cast of characters (politicians) and issues (from pay to pensions) remain.
Example:
The 3.1 percent civilian federal pay raise is official and takes effect with the first pay period beginning on or after Jan. 1. But that's not the end of the pay story.
This Congress must do what the last one failed to do: Complete action on appropriations bills so the government can operate on something other than temporary spending authority. One item of unfinished business is the Treasury-Postal Service appropriations bill. Both the Senate and House versions contain language that would give feds a 4.1 percent raise this month.
Assuming that's approved, the only way to cancel the raise would be for President Bush to veto the bill. That's unlikely. So, don't spend it yet.
Efforts to modify (or repeal) the Social Security "windfall" and "offset" laws will continue this year. Groups representing feds have been trying to have them modified since the 1980s. And they are getting closer, when you measure congressional support by the number of co-sponsors on the reform bills.
Windfall reduces (but does not eliminate) the earned Social Security benefit of someone retired (or retiring) under the old Civil Service Retirement System (CSRS). Windfall also hits many schoolteachers, public employees and workers for nonprofits who didn't pay into Social Security for a full career. Under the windfall formula, a retired fed (or teacher) who earned the minimum number of quarters (40) for Social Security benefits could see that benefit reduced by a little more than $270 per month.
The drive to modify the offset formula has also picked up steam thanks to lobbying by unions, professional groups and retiree organizations.
Offset can actually eliminate (as in wipe out) the spousal/survivor benefit a retired fed (or teacher) was expecting based on his/her spouse's Social Security coverage. Proposals to modify windfall and offset would exempt a portion of CSRS and Social Security monthly benefits from the formulas.
Groups such as the National Association of Retired Federal Employees have made "premium conversion" one of their top legislative items for 2003.
Premium conversion (already available to active duty feds and many private-sector workers) allows them to pay their portion of health premiums in pretax dollars. Doing that reduces taxable income and, in many cases, cuts their annual tax bill $200 to $500. That's a lot of money to some hard-pressed retirees who pay the same health premiums as federal workers.
Bills that would require the government to pay a bigger share of the total federal worker-retiree's health premiums will be reintroduced. But don't hold your breath.
Uncle Sam now pays an average of 72 percent of the total premium each year. With many private companies dropping, or reducing health coverage, there is little support beyond the Beltway for having the government pay a bigger share of health premiums for federal workers, and members of Congress.
Efforts to step up and also slow down the administration's privatization drive will continue. Backers say the government shouldn't be competing with the private sector and that work can be done better, faster (and contracts concluded when the task is completed) by the private sector.
Opponents argue that contracting out is a way to encourage campaign contributions from big firms. They also say the government needs to keep control over many operations everything from tax and Social Security records to intelligence and homeland security chores rather than farming them out to the lowest bidder.
Although Congress generally adopts a hands-off attitude toward the U.S. Postal Service, it may have to step in this year.
The USPS is competing (not all that well) with e-mail and services such as Federal Express and United Parcel Service.
It needs to reduce its labor-intensive costs (perhaps by as many as 65,000 workers), but doesn't have the authority to offer $25,000 buyouts available to 10 other federal agencies and departments.
Currently the USPS is offering VERAs (voluntary early retirement authorities) to a select group of management and administrative workers in its Eastern Area District Office and other area offices. But the bulk of its employees are postal clerks and letter carriers who don't have the buyout or VERA option.
A handful of federal agencies and departments have the authority from Congress to offer buyouts, worth up to $25,000 before deductions. They include giants like Defense and the Department of Veterans Affairs. But the law limits Defense to paying no more than 6,000 buyouts this fiscal year. VA will offer an even smaller number.
For the typical Washington area fed, the chances of getting a buyout this year are about the same as a hassle-free commute on the Beltway.


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