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

76 FR 52539Federal Employees' Retirement System; Present Value Conversion Factors for Spouses of Deceased Separated Employees

76 FR 52539Office of Personnel Management.

76 FR 52539The Office of Personnel Management (OPM) is issuing an interim 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, demographic and mortality assumptions adopted by the Board of Actuaries and published in the Federal Register on June 3, 2011, as required by 5 U.S.C. 8461(i).

76 FR 52539This rule is effective August 23, 2011.

76 FR 52539Roxann Johnson, (202) 606-0299.

76 FR 52539OPM has published a notice in the Federal Register at 76 FR 32242 (June 3, 2011) 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, new demographic factors and mortality assumptions adopted by the Board of Actuaries of the Civil Service Retirement System. By statute under 5 U.S.C. 8461(i), the demographic factors, economic and mortality 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.

76 FR 52539Alternatively, 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.

76 FR 52540Under section 553(b)(B) and (d)(3) of title 5, United States Code, I find that good reason exists for waiving the general notice of proposed rulemaking and for making these amendments effective in less than 30 days. The amendments made by this rule are statutorily mandated as a result of changes in economic assumptions that were published on June 3, 2011. Providing a comment period on the result of mathematical computations resulting from the changed economic assumptions is unnecessary and, to the extent that it would delay benefit payments, is contrary to the public interest.

76 FR 52540This 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.

76 FR 52540I 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.

76 FR 52540Air traffic controllers, Disability benefits, Firefighters, Government employees, Law enforcement officers, Pensions, Retirement. U.S. Office of Personnel Management. For the reasons stated in the preamble, the Office of Personnel Management amends 5 CFR part 843 as follows:

76 FR 525401. The authority citation for part 843 continues to read as follows:

76 FR 525405 U.S.C. 8461; §§ 843.205, 843.208, and 843.209 also issued under 5 U.S.C. 8424; § 843.309 also issued under 5 U.S.C. 8442; § 843.406 also issued under 5 U.S.C. 8441.

76 FR 525402. In § 843.309, revise paragraph (b)(2) to read as follows: § 843.309 Basic employee death benefit. (b) * * * (2) For deaths occurring on or after October 1, 2004, 36 equal monthly installments of 3.01643 percent of the amount of the basic employee death benefit.

76 FR 525403. Revise Appendix A to subpart C of part 843 to read as follows:

76 FR 52540With at least 10 but less than 20 years of creditable service— 26 .0581 27 .0620 28 .0687 29 .0723 30 .0807 31 .0869 32 .0933 33 .1013 34 .1086 35 .1186 36 .1273 37 .1376 38 .1474 39 .1612 40 .1737 41 .1877 42 .2026 43 .2192 44 .2365 45 .2550 46 .2757 47 .2987 48 .3222 49 .3488 50 .3767 51 .4079 52 .4410 53 .4776 54 .5176 55 .5609 56 .6081 57 .6588 58 .7152 59 .7767 60 .8441 61 .9183 With at least 20, but less than 30 years of creditable service— 36 .1516 37 .1636 38 .1756 39 .1915 40 .2066 41 .2233 42 .2410 43 .2606 44 .2811 45 .3032 46 .3279 47 .3549 48 .3829 49 .4143 50 .4475 51 .4843 52 .5235 53 .5669 54 .6139 55 .6652 56 .7208 57 .7811 58 .8476 59 .9203 With at least 30 years of creditable service— employee at birthday before death 46 .4213 .4572 47 .4557 .4943 48 .4918 .5335 49 .5318 .5768 50 .5744 .6231 51 .6213 .6738 52 .6714 .7282 53 .7267 .7880 54 .7866 .8528 55 .8518 .9233 56 .9227 1.0000