Federal Times Blogs
Some welcome news for Federal Aviation Administration employees: A soon-to-be-introduced bill would extend funding authorization for various FAA programs through the end of January. It would be the latest in the series of stopgap extensions, the most recent of which expires this coming Friday, Sept. 16.
The bill, posted Friday night on the House Rules Committee’s website, is sponsored by House Transportation and Infrastructure Committee Chairman John Mica, R-Fla. It can’t actually be introduced before Monday, a Mica spokesman said in an email.
Whatever happens after that, FAA employees can only hope that the ensuing congressional debate proceeds a little more decorously than the last time a similar measure was up. This summer, almost 4,000 agency staff were furloughed without pay for about two weeks after getting caught in the middle of a partisan standoff over union organizing rules and other issues. The total cost in lost salaries and benefits was about $40 million, according to the agency. Mica’s bill does not authorize any back pay for those workers.
Not clear at this point is how Senate Democrats plan to proceed. A spokesman for Senate Majority Leader Harry Reid, D-Nev., did not reply to email and phone messages Thursday and Friday seeking comment on Reid’s plans.
Mica’s bill would also extend highway programs through the end of March.
The Supercommittee’s work is about to get a lot tougher. It was already supposed to find about $1.5 trillion in deficit reduction, which is no easy task. But last night, President Obama asked the Supercommittee to find another $447 billion to pay for the jobs bill he proposed to a joint session of Congress:
The agreement we passed in July will cut government spending by about $1 trillion over the next ten years. It also charges this Congress to come up with an additional $1.5 trillion in savings by Christmas. Tonight, I’m asking you to increase that amount so that it covers the full cost of the American Jobs Act. And a week from Monday, I’ll be releasing a more ambitious deficit plan — a plan that will not only cover the jobs bill, but stabilize our debt in the long run.
If the bill gets passed — and with ironclad Republican opposition to anything that smacks of more stimulus, that’s a gargantuan “if” — that means the Supercommittee will have to cut the deficit by nearly $2 trillion. And upping the ante makes it even more likely that federal pensions, pay and other benefits will be on the chopping block.
President Obama earlier this year put federal pensions on the table as part of the so-called “grand bargain” he was pursuing with House Speaker John Boehner, including a high-five, increased contributions, and a change to pensions’ future cost-of-living adjustments. That deal collapsed, but I would not be surprised if some or all of those proposals come back in that deficit plan Obama promised to release Sept. 19.
What happens at the U.S. Postal Service doesn’t necessarily stay at the Postal Service.
The latest example: A federal workers’ compensation fund could run out of money within three months if the cash-strapped mail carrier skips a $1.2 billion payment due in mid-October, according to the Labor Department.
The department runs the fund under the Federal Employees’ Compensation Act. Should the Postal Service miss the October “chargeback” for past claims, officials estimate that the program would have no money to pay any benefits during the last four months of fiscal 2012, running from next June through September, according to a letter to Rep. Darrell Issa, R-Calif., chairman of the House Oversight and Government Reform Committee.
BUT, the fund could have to halt benefits by late this November if the Postal Service misses its required payment and—as is considered extremely possible—the government begins fiscal 2012 under a continuing resolution. The reason is that Congress generally doesn’t appropriate enough money under a short-term CR to cover the cost of annual lump sum benefits, Brian Kennedy, the Labor Department’s assistant secretary for congressional and intergovernmental affairs, said in the letter. On top of that, the workers’ comp fund wouldn’t have enough money to pay the vendor that processes medical claims under the compensation act, Kennedy wrote. His letter, dated Aug. 1, was first reported by Reuters news service.
So, will the Postal Service, which describes itself as effectively bankrupt, be able to ante up? At this point, the answer is yes, spokesman Dave Partenheimer said today in an email. But in its third-quarter report released earlier this month, the Postal Service suggested it could have “insufficient cash” to meet all of its federal obligations this fall, including the workers’ comp component.
The moral? To rewrite a famous line from English poet John Donne, no agency is an island. And for thousands of federal workers’ comp beneficiaries out there . . . keep your fingers crossed.
The Government Accountability Office just told its employees that the Office of Personnel Management has given the thumbs up to its buyout and early out plans. GAO sent employees a memo last week offering the buyouts and early retirements, but cautioning they were contingent on OPM’s approval.
The deadline to apply is Sept. 6, and those who accept the offers must retire by Sept. 30.
It seems every time we turn around these days, another agency is offering buyouts or early retirements. Last week, it was the Education Department, then the Government Accountability Office, and now the Commerce Department has gotten permission to use those tools to cut staff at eight bureaus.
What’s the scuttlebutt around your office? Are you hearing watercooler rumors about planned buyouts or early outs, or have your supervisors sent out e-mails or memos confirming they’re in the works? We’d love to hear what you’re hearing. E-mail me at email@example.com with any news about buyouts or early retirements at your agency. If you’d like to just talk off the record, that’s fine.
And while we’re on the subject, what do you think of these offers? Are you planning on taking them, if you have the chance? Is a $25,000 buyout offer enough to get you to give up your career, with the private sector job market so dicey and the stock market giving people whiplash? Or would you need more to give up your federal job?
The debt limit deal is in the Senate, and President Obama is expected to sign it. Which means all this debt limit craziness is over … right?
Here is Senate Minority Leader Mitch McConnell (R-K.Y.) on Fox News with Neil Cavuto.
(My own emphasis has been added).
MCCONNELL: It set the template for the future. In the future, Neil, no president — in the near future, maybe in the distant future — is going to be able to get the debt ceiling increased without a re-ignition of the same discussion of how do we cut spending and get America headed in the right direction. I expect the next president, whoever that is, is going to be asking us to raise the debt ceiling again in 2013, so we’ll be doing it all over.
And of course, agency budgets are due before fiscal year 2012 begins Oct. 1, or the government will be facing another shutdown. And the new deficit reduction commission will be making their recommendation on cuts a few months after that.
Plus the FAA is still in shutdown.
So what are your thoughts on all of this? How will the rest of the year shake out?
The electronic government funding saga continues, even if the e-government fund would no longer exist under a spending bill approved today by a House appropriations subcommittee.
As tech-conscious readers might remember, Congress whacked the e-gov account from $34 million in 2010 to $8 million in the year-long continuing resolution enacted this April. Under a fiscal 2012 spending bill approved today by the subcommittee, the fund would be folded into the General Services Administration’s Office of Citizen Services, said Daniel Schuman, policy counsel for the Sunlight Foundation, an open government group that has been birddogging the issue.
In all, the combined operation would receive $50 million under the bill.
How much of that would go to e-gov? Schuman estimates $13 million, assuming the citizen services office gets the same $37 million received last year. So, that would be substantially more than this year, but still a heckuva lot less than last year. A few weeks ago, the Obama administration said that this year’s reductions will force an end to two initiatives: Fedspace.gov and the Citizen Services Dashboard.
But with months of budget wrangling still ahead, this story is definitely to be continued.
According to a fact sheet issued by the White House, the proposed measures include slashing farm subsidies, cutting federal pension insurance, tricking Fort Knox security personnel into thinking that the president and five others are ordinary elevator repairmen, capping Medicaid’s outlays on equipment, shaping C4 charges to blast 21-inch-thick vault doors off their hinges, and curbing discretionary spending.
[...] “Reining in the runaway growth of entitlement programs and the defense budget will not be easy,” Obama said. “And neither will silently ferrying 5,000 tons of bullion through a network of ventilation ducts. But just trust me on this; I’ve got the blueprints and I think I found a way out through a drainage pipe.”
Other ideas under consideration: Trimming the federal workforce, raising the retirement age, and “taking out a $4 trillion fire insurance policy on the Pentagon and burning it to the ground.”
Attentive (and we mean really attentive) Fedline readers might remember a post from last month about the apparent disconnect of the Office of Personnel Management’s charging the U.S. Postal Service more for its current pension contributions at the same time the Obama administration is proposing a big refund to the Postal Service on past contributions. We’d asked OPM for comment and finally received an answer yesterday. So, in the interest of thoroughness, we’re rerunning the original Feb. 22 post, with the OPM response appended verbatim.
Here’s an intriguing nugget from the U.S. Postal Service’s latest quarterly report: Even as the Obama administration agrees that the Postal Service is owed a huge refund on past payments to its pension program, the Office of Personnel Management—headed by Obama appointee John Berry—is requiring it to shell out more for current payments.
For the first quarter of fiscal 2011, the Postal Service’s contributions to the Federal Employees Retirement System, or FERS, rose by $24 million—from $1,469 million to $1,493 million—versus the same period in fiscal 2010, even though the USPS workforce continued to shrink, the report says. The reason, according to the Postal Service, is that its employer contribution rate increased from 11.2 percent to 11.7 percent of eligible payroll. The agency is appealing that boost to a federal board of actuaries on the grounds that its FERS obligation is already overfunded to the tune of some $6.9 billion.
In its newly released 2012 budget request, the White House proposed refunding the Postal Service that money over 30 years, starting with a $550 million down payment this year.
At least to non-actuarial minds, it seems contradictory to be giving with one hand and taking away with the other. In an email, OPM spokeswoman Brittney Manchester offered the following explanation:
“Under current law, the Postal FERS ongoing contributions and the Postal FERS surplus are subject to different provisions of law that are independent of each other. Without specific legal authority, the Office of Personnel Management cannot make adjustments to Postal’s ongoing contributions despite the fact that there is a surplus in the retirement fund attributable to Postal employees.
“The October 1, 2010, increase in the FERS employer contribution rate applied not just to the Postal Service, but to all other agencies as well. Under FERS, all agencies pay the same contribution rate. Different provisions apply to the overall funding situation. Retirement funding is a long-term matter, and estimates have to be made covering economic and other factors that are many years distant. Over the past quarter century, Postal Service FERS funding has grown gradually to exceed projected future liabilities by approximately $6.9 billion.”
“The President’s 2012 Budget provides short-term financial relief through a sensible and fair restructuring of key retiree liabilities, while seeking to work with Congress and stakeholders to secure needed reforms to modernize its business model.”
With much of the government at risk of a forced vacation next month, there are some obvious parallels with the last such showdown, which resulted in back-to-back closures in late 1995 and early 1996. A bitter battle over spending; a Democratic president pitted against Republican lawmakers, many of them freshmen itching to shrink the federal footprint.
The last time around, though, executive branch preparations appear to have started a lot sooner.
Consider some evidence gleaned from congressional testimony: On August 22, 1995—almost three full months before the first shutdown occurred that November–then-Office of Management and Budget Director Alice Rivlin told all department heads to update their shutdown contingency plans within two weeks, according to a memo that was accompanied by a legal opinion outlining what government functions could continue during a “funding hiatus.” The congressional hearing record also shows that at least one agency, the Department of Veterans Affairs, had worked out a deal by September 1995 with the American Federation of Government Employees and the National Federation of Federal Employees on how to handle shutdown-related furloughs.
Now, barely a week before the March 4 expiration of a continuing resolution could trigger a new shutdown, union leaders say they’re still trying to pry basic information out of agencies on how workers would be affected.
The overall status of shutdown preparations is anyone’s guess. Most agencies won’t discuss the subject or release copies of their contingency plans. Asked earlier this week when six major departments, included Defense, Justice, and Agriculture, had most recently updated those plans, the Office of Management and Budget instead provided a statement from chief spokesman Ken Baer that said in part: “OMB is prepared for any contingency as a matter of course — and so are all the agencies.”
A more forthright assessment came from Social Security Administration Commissioner Michael Astrue. In a Wednesday email to SSA employees, Astrue wrote:
“The truth is that we do not know what Congress will do. We are working hard to deliver the best possible result from Congress and to carefully manage the money we do receive.
“As we await congressional action, we are doing what we can to minimize the budget uncertainties from interfering with your lives and work. You should know that we are considering a variety of scenarios but we have not made any final decisions. We will do what we can to prevent furloughs caused by not having enough money to pay you. That strategy may mean tough choices like cutting back on or eliminating overtime and expanding the hiring freeze.
“I regret that I cannot give you precise information about what will happen, but I am uncomfortable not letting you know some of the possible outcomes so that you can begin to plan accordingly. Given all of the uncertainty, I encourage you to be careful about believing everything you hear. I will continue to share what we know as more information becomes available.”