Federal Managers Association

To view a copy of the letter, please visit the “Members Only” section of FMA’s Web site at www.fedmanagers.org.

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WHAT’S HAPPENING ON CAPITOL HILL?

CONGRESSIONAL LEADERS STRESS PAY PARITY IN FY09

A coalition of Congressmen representing constituents in the Washington, D.C. area drafted a joint letter to President Bush advocating for pay parity for civilian employees and military personnel in fiscal year 2009. House Majority Leader Steny Hoyer (D-Md.), Delegate Eleanor Holmes Norton (D-D.C.), and Representatives Thomas Davis, III (R-Va.), Elijah Cummings (D-Md.), James Moran, Jr. (D-Va.), Chris Van Hollen (D-Md.), Albert Wynn (D-Md.), Frank Wolf (D-Va.), John Sarbanes (D-Md.) and C.A. Dutch Ruppersberger (D-Md.) all requested the Administration embrace pay parity for all federal employees.

This bipartisan delegation of politicians highlighted the two decade tradition of equal adjustments in compensation for members of the armed forces and civilian employees.

The letter also addressed several issues for which FMA has advocated over the last several years. “As we fight the war on terrorism at home and abroad, both the armed services and the federal civilian workforce are integral to fulfilling the role of government for the American people.  An equal pay adjustment in 2009 will send the important message that the services civilians and military personnel provide to America every day are highly valued.  In addition, the federal government is facing a ‘human capital crisis,’ with many of our most experienced employees poised to retire.  It is critical that we be able to recruit and retain quality employees in the future.”

The President’s budget was presented to Congress on February 4th. A copy of the joint letter can be found at http://hoyer.house.gov/newsroom/index.asp?ID=1103.

CONGRESSMAN WEIGHS IN ON DISABILITY CASE BACKLOG AT SSA

One Member of Congress has introduced legislation in an attempt to curtail the growing disability case backlog at the Social Security Administration (SSA). The Social Security Customer Service Improvement Act (H.R. 5110), introduced by Representative Brian Higgins (D-N.Y.) would give Congress an oversight role for SSA local hearing office operations.

Specifically, the bill would require SSA to provide Congress a nonpartisan detailed yearly budget estimate which would include yearly statistics of the number of cases pending at hearing offices, the rate at which case backlogs are increasing or decreasing, the average length of time it takes for claims to be administered, and staffing level trends at offices over time. The legislation would also prohibit SSA from closing or limiting hours at local offices without providing Congress with at least six months notice and thoughtful justifications for closure.

“With 750,000 pending requests for a hearing, the disability case backlog at the Social Security Administration is reaching unprecedented levels and deserves attention from Congress,” commented FMA National President Darryl Perkinson. “However, without looking at the specifics of the bill, I am unsure that adding another layer of bureaucracy is the way to fix this problem.”

COMINGS AND GOINGS IN WASHINGTON

A man who has served seven terms in the House of Representatives, Congressman Thomas Davis III (R-Va.), announced on January 30th an end to a successful career in Congress. Davis previously served as Chairman of the National Republican Congressional Committee, Chairman of the House Oversight and Government Reform Committee and most recently as Ranking Member of the same Committee.

“After much soul-searching and discussion with those closest to me, I have decided the time is right to take a sabbatical from public life.  I will serve out the remainder of my term, and plan to remain an active contributor to Republican causes, but will not run for office in 2008,” Davis said in a statement available on his Web site. He also discussed his desire to return to the private sector after three decades of serving in public office.

“As a true champion of federal employees, Congressman Davis’ decision to leave public office is a loss for the federal community,” commented FMA National President Darryl Perkinson. “I wish him and his family all the best in his future endeavors.”

In other news, President Bush has nominated Douglas Shulman to serve as the next Commissioner of the Internal Revenue Service (IRS) at the Department of Treasury. Shulman appeared before the Senate Finance Committee on January 29, 2008. Chairman Max Baucus (D-Mont.) and Ranking Member Senator Charles Grassley (R-Iowa) discussed the need to close the $345 billion tax gap between what is owed and what is paid by the government. Senators Baucus and Grassley hammered home the need to bolster customer service at the agency, overhaul an aging computer system and retain current employees while recruiting new talent. Shulman promised in his opening statement that he is up to the task, pledging to enforce the national tax laws and boost customer service at the agency.

Shulman was nominated on November 21, 2007 for the five year appointment. Currently, he serves as Vice Chairman of the Financial Industry Regulatory Authority, previously known as the National Association of Securities Dealers. Earlier in his career, he served as Vice President of Darby Overseas Investments. Prior to this he served as Senior Policy Advisor and later Chief of Staff of the bi-partisan National Commission on Restructuring the Internal Revenue Service. Mr. Shulman received his bachelor's degree from Williams College, his master's degree from the John F. Kennedy School of Government at Harvard University and his J.D. from Georgetown University Law Center.

HOUSE REPUBLICANS SEEK BIPARTISAN MORATORIUM ON EARMARKS

House Republicans, led by House Minority Leader John Boehner (R-Ohio) and Minority Whip Roy Blunt (R-Mo.) sent a letter to Speaker of the House Nancy Pelosi (D-Cali.) on January 25, 2008, requesting an end to the popular Congressional practice of hiding another form of pork-barrel spending - earmarks. Earmarks are a bipartisan practice conducted by many members in both houses of Congress which circumvent the allocation process. Congressmen have the ability to detail the amount and the exact recipient to whom the money is directed. Earmarks are included in Appropriations bills and the sheer numbers of earmarks made by Congress makes the process of removing individual earmarks a challenge.

House Republicans called for a halt to the practice of earmarks with a request to convene a bipartisan select committee to identify, “ways to bring fundamental change to the way in which Washington spends taxpayers’ money.” This olive branch offered by Republicans is an effort to stem a system of allocating resources that has been abused the past couple of years.

House Republicans list a number of standards that should be considered by a bipartisan committee on earmarks. The reform standards include a requirement that lawmakers should not utilize public funds to pay for projects named after themselves, a transparent appropriation process and end the practice of “airdropping” earmarks into bills when the House and Senate holds a conference to approve legislation. Other prohibitions include the end of laundering public funds into operations that mask their true recipients and a prerequisite that Congressmen who request earmarks draft plans that demonstrate how funds will be expended and the justification for such funding. The letter laments the public’s outlook of Washington as being a broken institution and “bold action must be taken” to revive the hearts and minds of the American electorate.

Following up on his State of the Union address, President Bush issued an Executive Order on January 29, 2008 calling for agencies not to expend earmarked funds that are included in non-statutory sources.  This includes requests in Congressional committee reports.  The exception is when an agency has determined that an activity has merit under statutory criteria.  The Order attempts to end Congress’s ability to skirt the competitive process.  The Order notes an earmark, “curtails the ability of the executive branch from managing its statutory and constitutional responsibilities pertaining to the funds allocation process.” The President rationalizes the suppression of earmarks because the Congressional practice usurps executive authority.

To view the letter to Speaker Pelosi, please visit http://republicanleader.house.gov/. President Bush’s Executive Order, entitled, “Protecting American Taxpayers From Government Spending on Wasteful Earmarks,” can be viewed at: http://www.whitehouse.gov/.

WHAT’S NEW IN THE EXECUTIVE BRANCH?

THE RESULTS ARE IN: NSPS RAISES BETTER THAN EXPECTED

The average National Security Personnel System (NSPS) raise equaled 5.9 percent plus a bonus totaling 1.7 percent of base pay, for a combined average of 7.6 percent in compensation in 2008. The majority of NSPS employees reported fell into Level 3, or “valued performer,” of the five-level rating scale under NSPS. Employees at this level received three adjustments to their pay: a raise linked to their pay band, or occupational grouping; a locality increase; and, a performance increase. Mary Lacey, Program Executive Officer for NSPS commented, “Last year, approximately 97 percent of the workforce performed at the valued performer or higher levels.” For Lacey, the results are telling. “These payout results, and the feedback we have received from managers, tell us NSPS is working.”

The President signed a revamped version of P.L. 110-181, the National Defense Authorization Act of 2008whichoutlined new criteria for NSPS and guarantees federal employees operating under NSPS 60 percent of the annual raise that all civilian federal employees receive, while the remaining 40 percent will be used for performance-related salary increases, predicated on an employee’s rating report.

“These unexpected results will surely make more employees optimistic about the system,” commented FMA National President Darryl Perkinson. “However, as the system grows, Congress and the Pentagon must ensure that all performing employees receive raises that compliment their performance.”

To review the NSPS performance rating tables, please visit: http://www.cpms.osd.mil/nsps/.

SHORT-TERM BUDGET DEFICIT CLOUDS LOOM OVER THE HORIZON

The nonpartisan Congressional Budget Office (CBO) released a report on January 23rd projecting the U.S. government budget outlook from 2008 to 2018. CBO predicts the fiscal year 2008 budget deficit will grow by 34 percent, or $219 billion, $64 billion higher than CBO’s August 2007 estimate. The federal government is expected to collect $2.7 trillion in revenues while spending $2.9 trillion in 2008. This projection assumes current laws and policies are not altered. The combat operations in Afghanistan and Iraq, the looming economic stimulus package under discussion in Congress, and the change in the Alternative Minimum Tax (AMT) were not included in the budget deficit calculation. If the AMT is left unaltered, it is projected to net the Treasury $75 billion. The CBO report noted, “A slowing economy this year will contribute to an increase in the deficit.”

Budget deficits will be the norm from 2009 to 2011, remaining at the levels projected for 2008. Small budget surpluses of 0.5 percent are projected from 2012 to 2018. Economic growth will not relieve the pressure of an aging population that uses such federal programs as Medicare and Medicaid. Medicare, Medicaid and Social Security spending will exceed the projected GDP growth-rate. Mandated spending, expenditures other than appropriated spending, is projected to grow 6 percent annually from 2009 to 2018, while discretionary spending will keep pace with the projected inflation rate of 2.2 percent.

The CBO report raises some concerns about the amount of debt held by the federal government, which is expected to equal 37 percent of the national GDP by the end of 2008, but will shrink to 22.6 percent of the GDP by 2018 due to the projected surpluses. The report also forecasts that the GDP should expand 1.7 percent while inflation will grow 1.8 percent in 2008. CBO estimates the unemployment rate will climb to 5.1 percent in 2008 and inch to 5.3 percent in 2009 and the national debt will increase to $10.3 trillion in 2009.

Comptroller General David Walker testified before the Senate Budget Committee on January 29th regarding the budget and reiterated many of the issues in the CBO report. The Government Accountability Office (GAO) paid particular attention to health related costs as imperiling the long-term health of the U.S. budget. Walker informed the committee, “We still face large and growing structural deficits driven primarily by rising health care costs and known demographic trends.”

The GAO report paints a negative picture concerning the national debt. The report indicated that the current national debt excludes future promised Social Security and Medicare benefits and the costs of veterans’ healthcare. If these are factored into the national debt, the total promised benefits would increase the national debt to $53 trillion.

Comptroller Walker offered some solutions to scuttle this impending dilemma, including universal access to health care, limits on federal spending on health related costs, national evidence-based medical practice standards to boost quality and reduce litigation costs, and ensuring individuals assume more responsibility for their own health decisions.

The CBO report can be accessed at http://www.cbo.gov/. GAO-08-411T and Comptroller Walker’s testimony can be found at http://www.gao.gov/.

DHS SCUTTLES LABOR RELATIONS PLAN

January 17th marked the deadline for the Department of Homeland Security (DHS) to file a status report with the U.S. District Court for the District of Columbia on its revisions to its Human Capital Operational Plan, known as MAX-HR, or its intention to drop the program. MAX-HR has been embroiled in litigation since it was unveiled when the National Treasury Employees Union (NTEU) filed a suit against DHS. The Court was of the opinion that DHS had to revise its program of converting General Schedule (GS) employees to a performance-based pay system. The Court ruled in favor of the Union in June 2006, stating the system illegally curtails collective bargaining rights for federal employees. The Court established the January 17th deadline for compliance or MAX-HR cannot be fully implemented.

The Consolidated Appropriations Act of 2008 (H.R. 2764) rendered MAX-HR useless. The Act did not allow any funds to develop, test, deploy or operate the program. The unions gained a victory and DHS was incapable of even contemplating revising the program.

The status report for National Treasury Employees Union, et al., v. Michael Chertoff, Secretary, United States Department of Homeland Security, et al., Civil Action No. 05-201 (RMC) can be visited at http://www.dcd.uscourts.gov/. H.R. 2764 can be viewed at http://thomas.loc.gov/.

TSP BOARD INFORMS FREQUENT TRADERS OF NEW POLICIES

Last month, the Internet was abuzz with the news that the Federal Thrift Retirement Investment Board (FTRIB) was going to limit the number of trades an enrollee of the Thrift Savings Plan (TSP) could make in a month. Despite rumors at the time, no decision was finalized as to how to address the costs associated with frequent trading.

By way of background, in 2006, the TSP incurred transaction costs of over $15 million, compared to $6.7 million in 2005 and $2.2 million in 2004. Most of these expenses occurred within the International Fund (I Fund) where the trading of $12 billion worth of securities cost the plan $13.8 million. FTRIB identified that roughly 3,700 participants, out of the nearly 4 million in the plan, were responsible for the increase in transaction costs.

Approximately 3,775 participants who completed more than three trades in October, November and December will receive letters notifying them that if they engage in more than three interfund transfers a month, they may be required to request transfers by mail only. The letter was sent with the hope that frequent traders change their behavior voluntarily.

It should be noted that more than 99 percent of the TSP enrollees requested 12 or fewer transfers in 2007 and will not be affected by the new rules. While nothing is definitive, any official change to interfund traders will be published in The Federal Register. Once the rule is published, anyone can comment within 30 days. Please check http://www.tsp.gov/ for the most up-to-date information.

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GET INVOLVED AT THESE EVENTS!

FMA ZONE CONFERENCES CONTINUE ACROSS THE COUNTRY!

On February 9th, FMA Zone 3 will be holding its annual conference in Atlanta, Georgia. The event will take place at the Hampton Inn Atlanta Galleria. Reservations can be made by calling 1-800-426-7866. The special FMA rate is $99.00 per night. The registration cost of the conference is $60. Questions? Contact Zone 3 President George Smith at czardog1@comcast.net.

On the same day, FMA Zone 2 will hold its annual conference at the Sleep Inn Suites in Baltimore, Maryland. For Reservations, call 410-789-7223 and be sure to ask for Pamela Sharps. The FMA nightly rate is $70.00 and the conference registration fee is $25. Questions? Contact Zone 2 President Jackie Bell at JEBell1949@comcast.net.

A full agenda for all the conferences can be found on FMA’s Web site. Please keep checking back with us online at www.fedmanagers.org for up-to-date information.

GOVERNMENT PERFORMANCE SUMMIT 2008 (10TH ANNUAL)

For the past ten years, federal leaders have gathered to explore the latest mandates and best practices in performance management and process improvement initiatives at the annual Government Performance Summit. The Summit is led by speakers from the upper echelons of the Executive and Legislative branches, as well as leading federal managers who offer their experience and advice to managers looking to improve the results earned by their programs and agencies — putting attendees in the room with the decision-makers on management policy from the Administration and Congress. For more information, visit the “Events” section at www.fedmanagers.org. FMA is an official cosponsor of this conference.

The event will be held February 25-27, 2008, at the Sheraton National Hotel in Arlington, VA. FMA members receive a $200 discount off registration fees. When registering, note priority code "P800-FMA."

HUMAN CAPITAL MANAGEMENT FOR DEFENSE 2008 (HCMD 2008)

Human Capital Management for Defense (HCMD 2008) is critical to your success in strategically managing human capital. Learn how senior leaders are developing the right mix of skills across the total force, aligning skills to requirements, and addressing competency gaps. Attend HCMD 2008 to gather best practices in the recruitment and retention of quality personnel and learn about exciting workforce development initiatives across DOD. For more information, please visit www.hcmd2008.com. FMA is an official cosponsor of this conference.

The event will be held February 26-29, 2008 at the Marriott Crystal Gateway, Arlington, VA.

REGISTER TODAY FOR FMA’S 70TH ANNUAL NATIONAL CONVENTION!

Planning for the Federal Managers Association 70th annual National Convention is underway! The event will take place March 9 – 13, 2008, at the Hilton Crystal City Hotel in Arlington, Virginia. Delegates can expect to receive a wealth of knowledge from private sector and government leaders under this year’s convention theme, Empowering America’s Workforce for the Challenges of Today, Tomorrow and Beyond.

Registration for the convention is now available. The regular registration rate is $425 and runs through February 13, 2008. The special FMA hotel rate is $169 per night and reservations can be made through the FMA Web site. The deadline for the special hotel rate is February 6th. Make your reservations today!

Please continue to check the “Events” section of the FMA Web site, www.fedmanagers.org, for the most up-to-date information. We look forward to seeing you in March!

APPLY FOR AN FMA-FEEA SCHOLARSHIP

Through the Federal Employee Education & Assistance Fund (FEEA), FMA has built a burgeoning scholarship program (administered by FEEA exclusively for FMA), which serves to award academic scholarships to deserving candidates through generous contributions from FMA members. It’s available to all FMA members, dependents and spouses, as well as FMA retirees. Thirteen winners from FMA families were awarded scholarships last year. To apply for the FMA-FEEA Scholarship visit www.fedmanagers.org/public/benefits.cfm. Instructions and a complete application for this scholarship can also be found in each year’s winter issue of The Federal Manager.

FYI: The Federal Employee Education & Assistance Fund has a new CFC number this year; 1-1-1-8-5. FEEA’s new number – 11185 – is the one to use when making a pledge. Make a donation, or learn more about how FEEA uses your contribution, by visiting www.feea.org.

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Long Term Care Partners, LLC, FMA Corporate Partner.  Long Term Care Partners is the administrator of t he Federal Long Term Care Insurance Program.  Sponsored by the U.S. Office of Personnel Management, the Program is available to Federal and U.S. Postal Service employees and annuitants, active and retired members of the uniformed services, and their qualified relatives.  With more than 210,000 enrollees, it is the largest employer-sponsored long term care insurance program in the country.  FLTCIP policies are simple to understand and offer enrollees some distinct advantages, including comprehensive coverage, competitive and stable rates, international coverage, and administrative service standards that are the highest in the long-term care insurance industry.  Policies are sold direct through a highly-trained, non-commissioned staff with no high pressure sales tactics – simply sound advice.  Visit www.LTCFEDS.com or http://www.opm.gov/insure/ltc/index.asp for more information.

Blue Cross Blue Shield Association Federal Employee Program, FMA Sustaining Corporate Partner:  The Blue Cross and Blue Shield Association represents the independent, locally operated Blue Cross and Blue Shield Plans. The 40 local member companies of the Blue Cross and Blue Shield Association have provided millions of families with top-quality, affordable health insurance for more than 70 years.  For the one in four Americans who carry Blue Cross and Blue Shield cards, the Blue Plans symbolize health security.  Visit www.fepblue.org and join the best, most-recognized group of health insurance providers in the world.

GEICO, FMA Corporate Partner:  GEICO was created over 60 years ago to insure Federal employees.  Over the years GEICO has continuously strengthened its affiliation with the Federal workforce.  Today GEICO has a special program established to support the Federal community.  GEICO’s Federal program participates in the following organizations and programs: GEICO Public Service Awards, which  have honored Federal workers (active and retired) who have contributed to the public good since 1980; and GEICO Federal Leave Record Cards, which for over 40 years have been provided by GEICO to Federal employees, free of charge, to help them track their annual leave.  Find out how much you could save with GEICO auto insurance as an FMA member by getting a line-by-line rate quote at:  www.geico.com.

Shaw, Bransford, Veilleux and Roth, P.C., (SBVR) concentrates its law practice on the representation of Federal employees, with a special emphasis on the representation of executives and managers.  SBVR serves as General Counsel to the Federal Managers Association and is uniquely situated to recognize the interests and viewpoints of Federal managers.  For up to two free half-hour legal consultations and reduced legal fees as an FMA member, please visit:  www.shawbransford.com.

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The Washington Report is published biweekly by the Federal Managers Association.
Jessica Klement, Editor; FMA Staff Writers.

The Federal Managers Association, established in 1913, is the oldest, largest, most influential association representing the interests of the nearly 200,000 managers, supervisors and executives serving in today’s Federal government.

1641 Prince Street ~ Alexandria VA 22314-2818 ~ (703) 683-8700 ~ FAX (703) 683-8707 ~ E-Mail Info@fedmanagers.org

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