Federal Employees' Retirement System; Present Value Conversion Factors for Spouses of Deceased Separated Employees

 
CONTENT

Federal Register, Volume 79 Issue 138 (Friday, July 18, 2014)

Federal Register Volume 79, Number 138 (Friday, July 18, 2014)

Proposed Rules

Pages 41928-41930

From the Federal Register Online via the Government Printing Office www.gpo.gov

FR Doc No: 2014-16949

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OFFICE OF PERSONNEL MANAGEMENT

5 CFR Part 843

RIN 3206-AM99

Federal Employees' Retirement System; Present Value Conversion Factors for Spouses of Deceased Separated Employees

AGENCY: Office of Personnel Management.

ACTION: Proposed rule.

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SUMMARY: The Office of Personnel Management (OPM) is issuing a proposed rule to revise the table of reduction factors for early commencing dates of survivor annuities for spouses of separated employees who die before the date on which they would be eligible for unreduced deferred annuities, and to revise the annuity factor for spouses of deceased employees who die in service when those spouses elect to receive the basic employee death benefit in 36 installments under the Federal Employees' Retirement System (FERS) Act of 1986. These rules are necessary to ensure that the tables conform to the economic and demographic assumptions adopted by the Board of Actuaries and published in the Federal Register on May 21, 2014, as required by 5 U.S.C. 8461(i).

DATES: We must receive your comments by September 16, 2014.

ADDRESSES: You may submit comments, identified by docket number and/or RIN number 3206-AM99, by any of the following methods:

Federal eRulemaking Portal: http://www.regulations.gov. Follow the instructions for submitting comments.

Email: combox@opm.gov. Include RIN number 3206-AM99 in the subject line of the message.

Mail: Jim Giuseppe, Retirement Policy, Retirement Services, Office of Personnel Management, 1900 E. Street NW., Washington, DC 20415-3200.

FOR FURTHER INFORMATION CONTACT: Roxann Johnson, (202) 606-0299.

SUPPLEMENTARY INFORMATION: On May 21, 2014, OPM published a notice in the Federal Register to revise the normal cost percentages under the Federal Employees' Retirement System (FERS) Act of 1986, Public Law 99-

335, 100 Stat. 514, as amended, based on economic assumptions and demographic factors adopted by the Board of Actuaries of the Civil Service Retirement System. 79 Fed. Reg. 29,224 (May 21, 2014). By statute under 5 U.S.C. 8461(i), the demographic factors

Page 41929

and economic assumptions require corresponding changes in factors used to produce actuarially equivalent benefits when required by the FERS Act.

Section 843.309 of title 5, Code of Federal Regulations, regulates the payment of the basic employee death benefit. Under 5 U.S.C. 8442(b), the basic employee death benefit may be paid as a lump sum or as an equivalent benefit in 36 installments. These rules amend 5 CFR 843.309(b)(2) to conform the factor used to convert the lump sum to 36-

installment payments with the revised economic assumptions.

Section 843.311 of title 5, Code of Federal Regulations, regulates the benefits for the survivors of separated employees under 5 U.S.C. 8442(c). This section provides a choice of benefits for eligible current and former spouses. If the current or former spouse is the person entitled to the unexpended balance under the order of precedence under 5 U.S.C. 8424, he or she may elect to receive the unexpended balance instead of an annuity.

Alternatively, an eligible current or former spouse may elect to receive an annuity commencing on the day after the employee's death or on the deceased separated employee's 62nd birthday. If the annuity commences on the deceased separated employee's 62nd birthday, the annuity will equal 50 percent of the annuity that the separated employee would have received had he or she attained age 62. If the current or former spouse elects the earlier commencing date, the annuity is reduced using the factors in Appendix A to subpart C of part 843 to make the annuity actuarially equivalent to the present value of the annuity that the spouse or former spouse would have received if the annuity had commenced on the retiree's 62nd birthday. These rules amend that appendix to conform to the revised economic assumptions.

Executive Order 12866, Regulatory Review

This rule has been reviewed by the Office of Management and Budget in accordance with Executive Order (E.O.) 12866, as amended by E.O. 13258 and E.O. 13422.

Regulatory Flexibility Act

I certify that this regulation will not have a significant economic impact on a substantial number of small entities because the regulation will only affect retirement payments to surviving current and former spouses of former employees and Members who separated from Federal service with title to a deferred annuity.

List of Subjects in 5 CFR Part 843

Air traffic controllers, Disability benefits, Firefighters, Government employees, Law enforcement officers, Pensions, Retirement.

U.S. Office of Personnel Management.

Katherine Archuleta,

Director.

For the reasons stated in the preamble, the Office of Personnel Management proposes to amend 5 CFR part 843 as follows:

PART 843--FEDERAL EMPLOYEES RETIREMENT SYSTEM--DEATH BENEFITS AND EMPLOYEE REFUNDS

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  1. The authority citation for part 843 continues to read as follows:

    Authority: 5 U.S.C. 8461; Sec. Sec. 843.205, 843.208, and 843.209 also issued under 5 U.S.C. 8424; Sec. 843.309 also issued under 5 U.S.C. 8442; Sec. 843.406 also issued under 5 U.S.C. 8441.

    Subpart C--Current and Former Spouse Benefits

    0

  2. In Sec. 843.309, revise paragraph (b)(2) to read as follows:

    Sec. 843.309 Basic employee death benefit.

    * * * * *

    (b) * * *

    (2) For deaths occurring on or after October 1, 2014, 36 equal monthly installments of 2.99522 percent of the amount of the basic employee death benefit.

    * * * * *

    0

  3. Revise Appendix A to subpart C of part 843 to read as follows:

    Appendix A to Subpart C of Part 843--Present Value Conversion Factors for Earlier Comencing Date of Annuities of Current and Former Spouses of Deceased Separated Employees

    With at least 10 but less than 20 years of creditable service--

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    Age of separated employee at birthday before death Multiplier

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  4. .0638

  5. .0700

  6. .0764

  7. .0831

  8. .0902

  9. .0978

  10. .1058

  11. .1142

  12. .1233

  13. .1331

  14. .1435

  15. .1547

  16. .1667

  17. .1794

  18. .1931

  19. .2079

  20. .2236

  21. .2406

  22. .2588

  23. .2784

  24. .2993

  25. .3218

  26. .3463

  27. .3725

  28. .4008

  29. .4313

  30. .4644

  31. .5001

  32. .5387

  33. .5806

  34. .6262

  35. .6756

  36. .7295

  37. .7882

  38. .8525

  39. .9228

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    With at least 20, but less than 30 years of creditable service--

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    Age of separated employee at birthday before death Multiplier

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  40. .1693

  41. .1825

  42. .1966

  43. .2116

  44. .2276

  45. .2449

  46. .2634

  47. .2833

  48. .3047

  49. .3276

  50. .3523

  51. .3787

  52. .4073

  53. .4380

  54. .4712

  55. .5070

  56. .5457

  57. .5875

  58. .6327

  59. .6818

  60. .7351

  61. .7930

  62. .8560

  63. .9248

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    With at least 30 years of creditable service--

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    Multiplier by separated

    employee's year of birth

    Age of separated employee at birthday before -------------------------

    death From 1950

    After 1966 through

    1966

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  64. .4457 .4811

  65. .4790 .5170

  66. .5151 .5559

  67. .5538 .5976

  68. .5955 .6426

  69. .6405 .6911

  70. .6892 .7435

  71. .7417 .8001

  72. .7986 .8614

  73. .8603 .9279

  74. .9272 1.0000

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    Page 41930

    FR Doc. 2014-16949 Filed 7-17-14; 8:45 am

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