NATCA Bookshelf

ISSUE For the past five years, legislators in both chambers of Congress have been trying to balance the federal budget in large part by making cuts to federal employees pay and benefits. As federal employees, NATCA members face these continued aacks. Some of the proposed aacks include increased retirement contributions for current employees as well as future hires, a reduction in retirement benefits for current employees as well as annuitants, alterations to retiree health benefits based on length of service, and a reduction in the workforce by 10 percent through arition. Past aacks that could return include another pay freeze and furloughs. MESSAGE Federal employees at the FAA are essential to our NAS. Congress should not target us in an aempt to balance the federal budget. BACKGROUND Beginning in the fall of 2010, the bi-partisan National Commission on Fiscal Responsibility and Reform (also called the Simpson- Bowles Commission) suggested reducing the budget through significant cuts to federal employees' pay and benefits. The final report, which was not formally approved by the entire Commission, laid the groundwork and became the framework for other anti-federal employee actions. The report included the following provisions, which have been included in amendments, proposed legislation, and budget resolutions. • Freeze federal salaries, bonuses, and other compensation for federal employees for three years. • Cut the federal workforce by 10 percent. • Use highest five years to calculate civil service pensions rather than the current high three. This would apply to both Civil Service Retirement System (CSRS) and Federal Employee Retirement System (FERS). • Ask federal workers to contribute half the cost (not the current 1/14th) of the defined benefit portion of FERS. • Reform cost-of-living-adjustment (COLA) payments for civilian & military early retirees. • Switch to a "more accurate" measure of inflation (chained CPI) for calculating COLAs for federal retirees and social security, reducing the buying power of both groups. • Raise the regular Social Security retirement age to 68 in 2050 and to 69 in 2075 (affects FERS employees). The Simpson-Bowles recommendations have been present in many proposals since 2010, including most recently the House and Senate FY 2016 Budget Resolutions, which are discussed below. CURRENT THREATS TO FEDERAL EMPLOYEES FY 2016 BUDGET RESOLUTIONS At the end of March, both the House and Senate passed budget resolutions for FY 2016 that included anti- federal employee provisions. Over the course of 10 years, they would save $318 billion in the House version, and $170 billion in the Senate version. While budget resolutions do not have the force of law, they lay the groundwork for appropriations commiees to allocate government funding. The anti-federal employee provisions included in the budget resolutions are as follows: • Requiring existing federal employees, as well as members of Congress and congressional staff, to contribute more toward their retirement (an increase of as much as six percent). • Eliminating the ability of individuals to receive a "special retirement supplement" that pays federal employees the equivalent of their Social Security benefit at an earlier age. • A 10 percent reduction in the federal workforce at certain agencies through arition, with the administration being permied to hire one employee for every three who leave government service (with exceptions for national security positions). • Revising how subsidies for federal retiree health care are calculated by basing the benefits for retired federal employees on their length of service, thereby reducing premium subsidies for retirees who had a relatively short federal career. • Changes to the Federal Employees Health Benefits Program. The House and Senate passed the FY 2016 budget conference agreement two weeks ago. The final version of the budget resolution leaves in cuts to federal employee benefits, but does not provide specifics. This leaves the door open for further legislative aempts in both chambers of Congress to balance the federal budget by making cuts to federal employees pay and benefits. FULL BACKGROUND n i w . n a t c a . n e t MAY 18-20, 2015 27

• Cover