House Oversight Committee Approves $50.9 Billion in Federal-Postal Retirement Cuts By 1 Vote

On Wednesday afternoon, April 30, after 6 hours of debate, the House Committee on Oversight and Accountability approved, by a narrow 22-21 vote, a series of retirement cuts that will now be included in a reconciliation bill that will likely be considered by the House of Representatives prior to the Memorial Day recess. (The recess begins May 24.)

The cuts to the postal and federal workforce total about $50.9 billion over the next decade. NAPS was at the committee meeting and engaged with committee members, including Chairman James Comer (R-KY) and Acting Ranking Democrat Stephen Lynch (D-MA). The reconciliation bill will not be assigned a bill number until the House Budget Committee aggregates the reconciliation language of all House committees receiving "reconciliation instructions."

At the conclusion of the Oversight and Accountability meeting, 22 Republican members of the committee voted in favor of the cuts; however, Rep. Michael Turner (R-OH) was the sole Republican who voted "no." 20 Democrats voted against the cuts. During debate, Rep. Turner stated: “I don’t believe it [the proposal] represents Republican values or American values,” he said. “I believe making changes to pension benefits in the middle of employment is wrong. Employee benefits are not a gift. They are earned.” Turner specifically criticized changing the retirement calculation from the High-3 to the High-5. The congressman's assessment reflected the same objection NAPS leveled against the proposal in its April 28 letter sent to all committee members. (NAPS' letter was included in the official hearing record.) In part, NAPS argued that the proposal would financially penalize those already vested in the retirement system. The committee-passed proposal differed from the original proposal circulated by committee by making the change from High-3 to the High 5 effective January 1, 2027, instead of upon enactment.

The other provisions in the original draft, which were posted on the NAPS website April 28, passed unchanged and would be effective upon enactment. The reconciliation language includes an increase in the FERS employee contribution rate to 4.4% for USPS personnel hired prior to 2014 (employees hired in 2014 and thereafter already contribute 4.4%). In addition, the committee-passed measure requires non-postal federal employees who do not become "at-will hires" to pay a higher FERS contribution rate than at-will hires. (An at-will hire loses virtually all civil service protections and could be fired without cause.) Also, the committee-passed language eliminates the FERS supplemental retirement for future annuitants who retire prior to Social Security eligibility. In addition, the committee-passed proposal imposes a $350 charge to appeal adverse personnel actions to the Merit System Protect Board.

NAPS will continue to fight the reconciliation package as its advances to the House floor and, potentially, to the Senate.