Civil Service Retirement System; Present Value Factors

Published date06 April 2020
Record Number2020-07103
SectionNotices
CourtPersonnel Management Office
Federal Register, Volume 85 Issue 66 (Monday, April 6, 2020)
[Federal Register Volume 85, Number 66 (Monday, April 6, 2020)]
                [Notices]
                [Pages 19171-19174]
                From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
                [FR Doc No: 2020-07103]
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                OFFICE OF PERSONNEL MANAGEMENT
                Civil Service Retirement System; Present Value Factors
                AGENCY: Office of Personnel Management.
                ACTION: Notice.
                -----------------------------------------------------------------------
                SUMMARY: The Office of Personnel Management (OPM) is providing notice
                of adjusted present value factors applicable to retirees under the
                Civil Service Retirement System (CSRS) who elect to provide survivor
                annuity benefits to a spouse based on post-retirement marriage; to
                retiring employees who elect the alternative form of annuity, owe
                certain redeposits based on refunds of contributions for service ending
                before March 1, 1991, or elect to credit certain service with
                nonappropriated fund instrumentalities; or, for individuals with
                certain types of retirement coverage errors who can elect to receive
                credit for service by taking an actuarial reduction under the
                provisions of the Federal Erroneous Retirement Coverage Correction Act.
                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, 2020.
                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.
                FOR FURTHER INFORMATION CONTACT: Karla Yeakle, (202) 606-0299.
                SUPPLEMENTARY INFORMATION: Several provisions of CSRS 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 831.2205(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. 8343a. That reduction is required to produce an
                annuity that is the actuarial equivalent of the annuity of a retiree
                who does not elect an alternative form of annuity. The present value
                factors listed below are used to compute the annuity reduction under
                section 831.2205(a) of title 5, Code of Federal Regulations.
                 Section 831.303(c) of title 5, Code of Federal Regulations,
                prescribes the use of these factors for computing the reduction to
                complete payment of certain redeposits of refunded deductions based on
                periods of service that ended before March 1, 1991, under section
                8334(d)(2) of title 5, United States Code; section 1902 of the National
                Defense Authorization Act for Fiscal Year 2010, Public Law 111-84.
                 Section 831.663 of Title 5, Code of Federal Regulations, prescribes
                the use of similar factors for computing the reduction required for
                certain elections to provide survivor annuity benefits based on a post-
                retirement marriage under section 8339(j)(5)(C) or (k)(2) of title 5,
                United States Code. 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 similar 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.
                [[Page 19172]]
                 Sections 839.1114-1121 of title 5, Code of Federal Regulations,
                prescribes the use of these factors for computing the reduction
                required for certain service credit deposits, Government Thrift Savings
                Plan contributions, or for previous payment of the FERS Basic Employee
                Death Benefit in annuities subject to the Federal Erroneous Retirement
                Coverage Corrections Act (FERCCA) under the provisions of Public Law
                106-265. Retirees and survivors who owe a larger deposit because of a
                retirement coverage error can choose to pay the additional deposit
                amount or their annuity will be actuarially reduced to account for the
                deposit amount that remains unpaid. Additionally, retirees and
                survivors of deceased employees who received Government contributions
                to their Thrift Savings Plan account after being corrected to FERS and
                who later elect CSRS Offset under FERCCA keep the Government
                contributions and associated earnings in their Thrift Savings Plan
                account. Instead of adjusting the Thrift Savings Plan account, FERCCA
                requires that the CSRS-Offset annuity be actuarially reduced. Also,
                survivors that received the FERS Basic Employee Death Benefit and elect
                CSRS Offset under FERCCA do not have to pay back the Basic Employee
                Death Benefit. Instead, OPM actuarially reduces the survivor annuity
                payable. These reductions under FERCCA allow the annuity to be
                actuarially reduced in a way that, on average, allows the Fund to
                recover the amount of the missing lump sum over the recipient's
                lifetime.
                 The present value factors currently in effect were published by OPM
                (84 FR 22525) on May 17, 2019. On April 6, 2020, 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 CSRS.
                Those changes require corresponding changes in present value factors
                used to produce actuarially equivalent benefits when required by the
                Civil Service Retirement Act. The revised factors will become effective
                on October 1, 2020. For alternative forms of annuity and redeposits of
                employee contributions, the new factors will apply to annuities that
                commence on or after October 1, 2020. See 5 CFR 831.2205 and
                831.303(c). For survivor election deposits, the new factors will apply
                to survivor reductions that commence on or after October 1, 2020. See 5
                CFR 831.663(c) and (d). For obtaining credit for service with certain
                nonappropriated fund instrumentalities, the new factors will apply to
                cases in which the date of computation under sections 847.603 or
                847.809 of title 5, Code of Federal Regulations, is on or after October
                1, 2020. See 5 CFR 842.602, 842.616, 847.603, and 847.809. For
                retirement coverage corrections under FERCCA, the new factors will
                apply to annuities that commence on or after October 1, 2020, or in the
                case of previous payment of the Basic Employee Death Benefit, the new
                factors will apply to deaths occurring on or after October 1, 2020. See
                5 CFR 839.1114-1121 and 5 CFR 831.303(d).
                 OPM is, therefore, revising the tables of present value factors to
                read as follows:
                 CSRS Present Value Factors Applicable to Annuity Payable Following an Election Under Section 8339(j) or (k) or
                 Section 8343a of Title 5, United States Code, or Under Section 1043 of Public Law 104-106 or Under Section 1132
                 of Public Law 107-107 or Under FERCCA or Following a Redeposit Under Section 8334(d)(2) of Title 5, United
                 States Code
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                 Age Present value factor
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                40......................................................................... 378.1
                41......................................................................... 372.3
                42......................................................................... 366.4
                43......................................................................... 360.4
                44......................................................................... 354.4
                45......................................................................... 348.3
                46......................................................................... 342.2
                47......................................................................... 336.1
                48......................................................................... 329.9
                49......................................................................... 323.6
                50......................................................................... 317.3
                51......................................................................... 311.0
                52......................................................................... 304.5
                53......................................................................... 298.0
                54......................................................................... 291.4
                55......................................................................... 284.7
                56......................................................................... 277.9
                57......................................................................... 270.8
                58......................................................................... 263.8
                59......................................................................... 256.6
                60......................................................................... 249.4
                61......................................................................... 242.2
                62......................................................................... 234.8
                63......................................................................... 227.4
                64......................................................................... 220.0
                65......................................................................... 212.5
                66......................................................................... 205.1
                67......................................................................... 197.6
                68......................................................................... 190.2
                69......................................................................... 182.8
                70......................................................................... 175.4
                [[Page 19173]]
                
                71......................................................................... 168.0
                72......................................................................... 160.7
                73......................................................................... 153.4
                74......................................................................... 146.2
                75......................................................................... 139.1
                76......................................................................... 132.1
                77......................................................................... 125.2
                78......................................................................... 118.4
                79......................................................................... 111.8
                80......................................................................... 105.2
                81......................................................................... 98.9
                82......................................................................... 92.7
                83......................................................................... 86.8
                84......................................................................... 81.1
                85......................................................................... 75.6
                86......................................................................... 70.3
                87......................................................................... 65.4
                88......................................................................... 60.7
                89......................................................................... 56.3
                90......................................................................... 52.2
                91......................................................................... 48.5
                92......................................................................... 45.0
                93......................................................................... 41.8
                94......................................................................... 38.9
                95......................................................................... 36.2
                96......................................................................... 33.8
                97......................................................................... 31.6
                98......................................................................... 29.7
                99......................................................................... 27.9
                100........................................................................ 26.2
                101........................................................................ 24.7
                102........................................................................ 23.3
                103........................................................................ 22.0
                104........................................................................ 20.6
                105........................................................................ 19.0
                106........................................................................ 17.1
                107........................................................................ 14.2
                108........................................................................ 9.5
                109........................................................................ 6.4
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                 CSRS Present Value Factors Applicable to Annuity Payable Following an Election Under Section 1043 of Public Law
                 104-106 or Under Section 1132 of Public Law 107-107 or Under FERCCA
                 [For Ages at Calculation Below 40]
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                 Age at calculation Present value of a monthly annuity
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                17......................................................................... 486.1
                18......................................................................... 482.3
                19......................................................................... 478.4
                20......................................................................... 474.5
                21......................................................................... 470.4
                22......................................................................... 466.4
                23......................................................................... 462.2
                24......................................................................... 457.9
                25......................................................................... 453.6
                26......................................................................... 449.2
                27......................................................................... 444.7
                28......................................................................... 440.2
                29......................................................................... 435.5
                30......................................................................... 430.8
                [[Page 19174]]
                
                31......................................................................... 425.9
                32......................................................................... 421.0
                33......................................................................... 416.0
                34......................................................................... 410.9
                35......................................................................... 405.7
                36......................................................................... 400.4
                37......................................................................... 395.0
                38......................................................................... 389.5
                39......................................................................... 383.9
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                Office of Personnel Management.
                Alexys Stanley,
                Regulatory Affairs Analyst.
                [FR Doc. 2020-07103 Filed 4-3-20; 8:45 am]
                 BILLING CODE 6325-38-P
                

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