NATCA Bookshelf

FULL BACKGROUND ISSUE For the past six 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, which would directly affect the vast majority of NATCA members. Some of the proposed attacks on federal employee pay and benefits include increased retirement contributions for current and future employees, a reduction in retirement benefits for current employees and annuitants, alterations to retiree health benefits based on length of service, and a reduction in the workforce by 10 percent through natural attrition. Pay freezes and furloughs have also taken their toll on federal employees and could return. MESSAGE FAA employees are essential to the safety and efficiency of the National Airspace System (NAS). Congress should not target FAA employees in an attempt to balance the federal budget. BACKGROUND Beginning in the fall of 2010, the bipartisan National Commission on Fiscal Responsibility and Reform (also called the Simpson-Bowles Commission or the Deficit Commission) suggested reducing the federal 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 since been included in a range of 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 the Civil Service Retirement System (CSRS) and the Federal Employee Retirement System (FERS); • Ask federal workers to contribute half of the cost (compared to the current 1/14th) of their 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, which reduces the buying power of both groups; and • Raise the regular Social Security retirement age to 68 in 2050 and 69 in 2075 (affects FERS employees). CURRENT THREATS TO FEDERAL EMPLOYEES In the Senate, Mike Enzi (R-WY), Chairman of the Senate Budget Committee, announced this past March that the fiscal year (F Y) 2017 budget resolution will be delayed, but that discussions will continue on the fiscal blueprint. In the House, Budget Committee Chairman Tom Price (R-GA) released an F Y2017 budget resolution (H.Con.Res.125) that continues the attack on federal employees. However, this budget resolution has not been agreed to by the full House. The deadline for a Congressional budget was April 15, at which point no budget had been agreed to. While budget resolutions do not have the force of law, they lay the groundwork for the appropriations committees to allocate government funding. The anti-federal employee provisions included in the budget resolution are as follows: • Require existing federal employees, as well as members of Congress and congressional staff, to contribute more toward their retirement; • Cut the federal workforce at certain agencies by 10 percent through attrition, and allow the administration to hire one employee for every three who leave government service (with exceptions for national security positions); • Revise 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 relatively short careers; • Change the Federal Employees Health Benefits Program. Moving forward, the budget's path in the House is uncertain as long as opposition from conservative Republicans continues. This opposition means the budget is unlikely to have enough support to garner 218 votes to pass, as the Freedom Caucus is expected to vote as a block. Even if it were to pass, the policy specifics outlined in the budget would serve as guidelines rather than as enacted law. 29

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