June 2018 NARFE Magazine

JUN

’18

P.40

TRANSFORM THE WAY YOU LEAD COVER STORY

CIVIL SERVICE SYSTEMS

AROUND THE WORLD P.32

Volume 94 • Number 6

Federal Employee Program

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The Service Benefit Plan will pay a hearing aid benefit up to $2,500 total every 3 calendar years for adults age 22 and over, and up to $2,500 total per calendar year for members up to age 22. Do not rely on this communication piece alone for complete benefit information. All benefits are subject to the definitions, limitations, and exclusions in your Service Benefit Plan brochure. The Blue365® Discount Program offers access to savings on items that you may purchase directly from independent vendors, which may be different from items covered under the Service Benefit Plan or any other applicable federal healthcare program. For hearing aids, acupuncture, chiropractic and vision services, you must exhaust your Service Benefit Plan benefits first before accessing the savings of the Blue 365® Discount Program. To find out what is covered under your policy, contact Service Benefit Plan. The products and services described herein are neither offered nor guaranteed under any local Blue company’s contract with the Medicare program. These items are not subject to the Medicare appeal process.

Any disputes regarding these products and services are not subject to the Service Benefit Plan’s Disputed Claims process. Blue Cross and Blue Shield Association (BCBSA) may receive payments from Blue365 vendors. Neither the the Service Benefit Plan, BCBSA, nor any local Blue company recommends, endorses, warrants or guarantees any specific Blue365 vendor or item. The Service Benefit Plan reserves the right to change, modify, or terminate any item and vendors made available through Blue365, at any time. Available at participating locations until 12/31/2018.

Beltone is made available through Blue365, which provides exclusive health and wellness deals and is a program of Blue Cross Blue Shield Association, an association of independent Blue Cross and Blue Shield Companies. Beltone is an independent company providing discounts on hearing aids. © 2017 GN Hearing Care corporation. All rights reserved. Beltone is a trademark of GN Hearing Care Corporation. Apple, the Apple logo, iPhone, iPad, iPod touch and Apple Watch are tradmarks of Apple Inc., registered in the U.S. and other countries.

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SPECIAL SECTION

6

Special Election Section

61

NARFE 2017 Financial Statements

WASHINGTON WATCH

14 Senate Postal Reform Bill Introduced

32

15

President’s Management Agenda Seeks to Improve Performance

16

A Relic From the Past, Holman Rule Threatens Feds Today

17

NARFE PAC: Meeting Our Goals

COVER STORY

18 Omnibus Sets 2018

CIVIL SERVICE SYSTEMS AROUND THE WORLD. How does the United States civil service system compare? Studies point out similarities and differences in pay, benefits and public perception.

19 Summer Holds Endless

Funding, But Risks Emerge for 2019 Budget Possibilities for Advocacy Action

20 NARFE Bill Tracker COLUMNS

4

40

FEDERAL LEADERSHIP DEVELOPMENT PROGRAMS. Transform your leadership skills by choosing among many training options.

From the Executive Director

48 Managing Money 50 Alzheimer’s Update DEPARTMENTS

22 Questions & Answers,

On the Web

Federal Benefits In-Depth

VISIT US ONLINE AT:

52 For the Record

www.narfe.org

54 NARFE News

LIKE US ON FACEBOOK:

NARFE National Headquarters FOLLOW US ON TWITTER:

@narfehq

ON THE COVER

Illustration by GRAPHEK

58 FEDcon18 72 The Way We Worked W W W. N A R F E . O R G

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JUNE 2018 | Volume 94 | Number 6

EDITOR Susan Boswell ASSISTANT EDITOR Christopher Johnson COMMUNICATIONS ASSISTANT Precious Dorch-Robinson GRAPHIC DESIGN GRAPHEK EDITORIAL BOARD Richard G. Thissen, Jon Dowie, Barbara Sido EDITORIAL OFFICE: narfe magazine 606 North Washington St. Alexandria, VA 22314-1914 Phone: 703-838-7760 Fax: 703-838-7781 Email: communications@narfe.org ADVERTISING SALES: Warren Berger Media People Inc. 122 East 42nd St., Suite 1622 New York, NY 10168 Phone: 212-779-7172, ext. 223 Email: wberger@mediapeople.com

NARFE FOR THE VISUALLY IMPAIRED ON THE TELEPHONE: This publication can be heard on the telephone by persons who have trouble seeing or reading the print edition. For more information, contact the National Federation of the Blind NFB-NEWSLINE® service at 866-5047300 or go to www.nfbnewsline.org.

ON DIGITAL AUDIO: Issues of narfe magazine are also available in audio format through the National Library Service for the Blind and Physically Handicapped (NLS). For availability, call 202-727-2142 or your local NLS service provider.

The Association, since July 1970, has been classified by the IRS as a tax-exempt labor organization [not a union]; however, dues and gifts or contributions to the Association are not deductible as charitable contributions for income tax purposes.

National Active and Retired Federal Employees Association NATIONAL OFFICERS RICHARD G. THISSEN, President; natpres@narfe.org JON DOWIE, Secretary/Treasurer; natsectreas@narfe.org EXECUTIVE DIRECTOR BARBARA SIDO, execdir@narfe.org

REGIONAL VICE PRESIDENTS

REGION I James P. Crawford (Connecticut, Maine, Massachusetts, New Hampshire, New York, Rhode Island and Vermont) TEL: 603-630-5191 EMAIL: crawfordjim62@gmail.com REGION II Evelyn Kirby (Delaware, District of Columbia, Maryland, New Jersey and Pennsylvania) TEL: 410-604-1141 EMAIL: ekirby@atlanticbb.net REGION III Clarence Robinson (Alabama, Florida, Georgia, Mississippi, South Carolina, Puerto Rico and Virgin Islands) CELL: 404-312-8028 EMAIL: crobin8145@att.net

REGION VI Marshall L. Richards (Arkansas, Louisiana, Oklahoma, Republic of Panama and Texas) TEL: 903-660-2784 EMAIL: pappysdad@cobridge.tv REGION VII Rodney L. Adelman (Arizona, Colorado, New Mexico, Utah and Wyoming) TEL: 623-505-4719 EMAIL: narfe7vp@cox.net REGION VIII Helen L. Zajac (California, Guam, Hawaii, Nevada and Republic of Philippines) TEL: 707-644-7565 EMAIL: HLZajac125@gmail.com

REGION IV Edward J. Konys (Illinois, Indiana, Michigan, Ohio and Wisconsin) TEL: 937-470-0566 EMAIL: region4vp@gmail.com

REGION IX Richard Wilson (Alaska, Idaho, Montana, Oregon and Washington) TEL: 253-210-5609, CELL: 425-736-6899 EMAIL: narfe1404@comcast.net

REGION V Carol R. Ek (Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota and South Dakota) TEL: 620-241-1131, CELL: 620-504-2202 EMAIL: ek617@att.net

REGION X William Shackelford (Kentucky, North Carolina, Tennessee, Virginia and West Virginia) TEL: 703-830-6590, CELL: 703-201-6304 EMAIL: wshack1951@aol.com

HERE’S HOW TO CONTACT US…

TO JOIN NARFE, RENEW YOUR MEMBERSHIP OR FIND A LOCAL CHAPTER:

CALL (TOLL-FREE) 800-456-8410 OR GO TO www.narfe.org TO CHANGE YOUR ADDRESS, PHONE NUMBER OR EMAIL LISTING:

CALL (TOLL-FREE) 800-456-8410 EMAIL memberrecords@narfe.org OR GO TO www.narfe.org, log in and click on “Update My Record”

TO REACH A FEDERAL BENEFITS SPECIALIST:

EMAIL fedbenefits@narfe.org NARFE HEADQUARTERS

606 N. Washington St. Alexandria, VA 22314 703-838-7760 Hours of operation: Monday-Friday, 8 a.m.-5 p.m. ET

www.narfe.org

narfe (ISSN 1948-4453) is published monthly by the National Active and Retired Federal Employees Association (NARFE), 606 N. Washington St., Alexandria, VA 22314. Periodicals postage paid at Alexandria, VA, and additional mailing offices. Members: Annual dues includes subscription. Nonmember subscription rate $40. Postmaster: Send address change to: NARFE Attn: Member Records, 606 N. Washington St., Alexandria, VA 22314. To ensure prompt delivery, members should also forward changes of address without delay. Because of the volume involved, NARFE cannot acknowledge nor be responsible for unsolicited pictures and manuscripts, although every reasonable precaution is taken. All submissions become the property of NARFE. Copyright © 2018, NARFE. Advertisements in the magazine are not endorsements of products and/or services by NARFE, unless officially stated in the ad. We shall accept advertising on the same basis as other reputable publications: that is, we shall not knowingly permit a dishonest advertisement to appear in narfe, but at the same time we will not undertake to guarantee the reliability of our advertisers.

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From the Executive Director

PROGRESS TO CENTENNIAL

O

ver the past two months, I’ve had the opportunity to speak directly with members and chapter leaders

at various federation conferences. The excitement buzzing around NARFE Next is palpable.

I was pleased to hear that so many members are excited about NARFE’s efforts to address the negative public perception of civil servants.

NARFE’s influencer analysis research effort seeks to identify detractors, sources and financial donors portraying misleading, negative impressions of federal employees. As this initiative unfolds, NARFE’s Advocacy, Communications, Marketing and Membership Resources Departments will be developing resonating and compelling communication pieces telling the story of federal service and engaging with reporters who are misinformed.

Working at NARFE has been one of the most meaningful experiences in my career. I’m

reminded every day of the inspiring and impactful work that you and other federal employees perform.

From helping low-income families purchase a home to treating veterans with visible and unseen wounds, your work is invaluable.

We often hear that perception drives policy. The public should know how the work of federal employees touches lives. Whether meeting with legislators, visiting chapters, or connecting with journalists, headquarters leadership is passionate about representing the federal community and eager to transform the public perception of civil servants into a lasting, positive one.

As we examine the causes and disseminators of such negative reports, headquarters is undergoing an extensive review of the perception of the association through a comprehensive branding campaign.

We need to know how NARFE is currently perceived and further develop our brand identity to shape the perception of NARFE in the future. How we present ourselves to our constituents is important as we enter into 2021 as a viable and significant organization.

The first major element of the NARFE Next Initiative, FEDcon18 will lead us into our strategic transformation in preparation of the centennial in 2021.

Its staying power will take us beyond as it becomes a lasting product of the evolving NARFE brand.

If you haven’t registered for FEDcon18, I encourage you to do so and look forward to seeing and speaking with you in Jacksonville.

BARBARA SIDO NARFE EXECUTIVE DIRECTOR execdir@narfe.org 4

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VOTING INSTRUCTIONS

P

lease carefully review the entire instructions prior to completing your ballot. You are eligible to vote in the election if you are a NARFE member in good standing as of March 15, 2018. You may cast your vote either online OR by mail. Once your member ID and PIN number are used on any ballot, they will not be valid for additional ballot(s). Please take time to vote today. Thank you for participating in NARFE’s election process.

REVIEW THE BALLOT CAREFULLY

• Candidates for national or regional office: Vote for one candidate for each national office. Vote for the Regional Vice President (RVP) candidate in your region only. Please note your region number at the top of the ballot. Do not vote for an RVP if your region is not listed on the ballot and has an uncontested election.

For information about the candidates, refer to the March issue of narfe magazine (p. 52) or visit www. narfe.org/2018Balloting.

• Ballot Question 1 background: If the first ballot does not produce a majority vote, then a vote is required to allow preferential voting on the second ballot. For preferential voting, voters place a number next to the name of each candidate indicating their 1st, 2nd, 3rd (and so on) choices. All choices are taken into consideration on one ballot, eliminating the need for additional ballots. For further information, see p. 7 or visit www.narfe.org/2018Balloting.

• Ballot Question 2 background: Review the “Second Amended And Restated Articles Of Incorporation Of National Active And Retired Federal Employees Association,” on p. 8 or visit www.narfe. org/2018Balloting.

• Ballot Question 3 background: Review the “NEB Resolution: Secretary/Treasurer Salary,” on p. 8 or visit www.narfe.org/2018Balloting.

• Bylaws and Resolutions: For information on the bylaws and resolutions for voting, please see p. 9-11 of this issue. For additional details, visit www. narfe.org/2018Balloting to download a PDF book that contains this report as well as proposals to amend NARFE bylaws (ballot items as well as all submissions), content of proposals acted on by the committee, and 2018 Bylaws Committee Rationale.

• For the proposals recommended by the Bylaws and Resolutions Committee for

NEED ASSISTANCE? For voting assistance, please call 1-866-720-4357 on Monday – Friday between 9 a.m.-5 p.m. ET, or email narfehelp@electionservicescorp.com adoption, vote on the first line to adopt all OR vote individually on items to adopt or reject each item. Ballots that are not correctly completed will be invalidated.

• For the proposals recommended by the Bylaws and Resolutions Committee for rejection, vote on the first line to reject all OR vote individually on items to adopt or reject each item. Ballots that are not correctly completed will be invalidated.

VOTE BY MAIL • Place a Q or R or darken the box to indicate your

choices. Use dark blue or black ink.

• Do not write your name or otherwise identify yourself on the ballot.

• Tear or cut this ballot along the perforated line to detach.

Place a First Class stamp on the reverse side of this card to mail.

• Ballots must be received at Election Services Co. by 11:59 p.m. ET on June 30, 2018. Please mail your ballot at least 7 days before the deadline to allow sufficient time for delivery.

• Do not mail ballots to NARFE. Ballots received by NARFE will be disqualified.

VOTE ONLINE

• Please go to https://www.esc-vote.com/ narfe2018 to log in and vote.

• You must have your member ID number and your unique PIN number to log in. These numbers can be found at the top of the printed ballot. These numbers will serve as your unique identifier for voting. Please do not share them with others.

• For ease of voting online, Election Services Co. will email members with an email on file with NARFE. Members can click on the link in the email to go to the voting website and cast a vote using the member ID number and unique PIN number included in the email to log in.

• Once you are logged in, follow the online voting instructions.

• On the online ballot, members will see only those candidates for whom they may cast a vote.

• Online voting begins May 10, 2018, and ends at 11:59 p.m. ET on June 30, 2018.

Ballots must be received at Election Services Co. by 11:59 p.m. ET on June 30, 2018 6

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BALLOT QUESTIONS

Ballot Question 1:

Preferential Voting Explained

T

he adoption of the “one member, one vote” governance change in 2016 didn’t just change who elects NARFE officers, it changed how they are elected.

One consequence is that there’s no practical way to conduct the election without a separate ballot. With four candidates on the ballot for one office, it’s likely that no one candidate will get a majority on the first ballot, causing an incomplete election and requiring another round of balloting.

The following are responses to questions you may have.

Isn’t it “most votes wins?”

The NARFE bylaws require a majority vote, which is “more than half.”

Plurality, which is the most votes whether or not a majority, would be a direct violation of the bylaws.

How about a runoff election?

This option is not in the bylaws and violates a member’s right to run for office. Dropping names from the ballot indicates that those candidates didn’t have the same opportunity as the top two candidates to win a runoff.

So, what do we do? One solution is to have the voters rank the candidates in order of preference, aptly named preferential voting. The one potential complication is that Robert’s Rules states that this method must be allowed in the bylaws. However, this voting method violates no one’s rights, has been shown to be

legal in court cases, and first, second, third and fourth leaves everyone on place votes will be assigned the ballot. a value, such as 3 points Acting on the for first, 2 points for advice of the second, 1 point for 2018 NARFE parthird, and 0 points for liamentarian, fourth place. There’s the National no advantage to not Executive Board filling out all the pref(NEB) decided erences; it just means to ask the memthat you lose your voice bership on the first if your top candidate(s) ballot for permission to aren’t elected. suspend the rules and use For example, assume there preferential voting on the next ballot, are four candidates: Adams, Barker, if needed. Thus, the ballot for the Cooper and Denmark. The voter election of NARFE officers this year prefers Cooper, so that candidate is will include a question to that effect, marked with a “1” for the first choice. which will require a two-thirds vote.

Then the voter chooses Barker as the second choice, marking it with But, what if it doesn’t pass? a “2.” Denmark, the third choice, is If preferential voting doesn’t pass, marked with “3” and Adams, as the last choice, is marked with “4.” In the the election for president will be tally, Cooper gets 3 points, Barker re-balloted repeatedly until a winner is determined. This would have gets 2 points, and Denmark gets 1 point. All preferences from all voters significant financial implications, are taken into account. as well as an impact on when the In this case, Adams and Barker new national president would ascould be the first choice for two difsume office. ferent groups of people, and Cooper What is preferential voting? (their second choice) could be a If there is a two-thirds vote to suscompromise candidate on whom all pend the rules, NARFE will send agree. In a preferential vote, that out the next election ballot in the preference comes to the surface, magazine with spaces to rank your and the candidate truly favored by choices in order of preference. Once the bulk of the voters is revealed. the second ballot is received, an Preferential voting doesn’t violate independent and impartial voting anyone’s rights and returns a relicompany will first tally to see if the able answer. first-place votes return a majority —COLETTE COLLIER TROHAN SERVES AS NARFE’S for any candidate. If no majority, the PARLIAMENTARIAN.

NARFE ELECTIONS

DO YOU NEED VOTING ASSISTANCE? For voting assistance, please call 1-866-720-4357 on Monday – Friday between 9 a.m.-5 p.m. ET, or email narfehelp@electionservicescorp.com.

W W W. N A R F E . O R G

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Ballot Question 2:

Second Amended And Restated Articles Of Incorporation Of National Active And Retired Federal Employees Association FIRST: The Corporation is a nonprofit corporation under the District of Columbia Nonprofit Corporation Act and the name of the Corporation is: National Active and Retired Federal Employees Association.

SECOND: The purposes of the Corporation shall be as follows: 1) To support legislation, rules and regulations beneficial to current and potential federal civilian annuitants and to oppose legislation, rules and regulations contrary to their interests.

2) To promote the general welfare of current and potential federal civilian annuitants by advising and assisting them with respect to their rights under employment and retirement laws, rules and regulations.

3) To cooperate with other organizations and associations in furtherance of these purposes.

THIRD: The Corporation shall have members as provided in the Bylaws of the Corporation.

FOURTH: In the event of the dissolution of the Corporation, the Corporation shall convey any or all remaining assets of the Corporation to any other tax-exempt organization having aims and objectives substantially similar to those of the Corporation, or to the government of the United States.

FIFTH: A director is not liable to the Corporation or any of its members for money damages for any action taken, or any failure to take any action, as a director, except for liability for: (1) the amount of a financial benefit received by the director to which the director is not entitled; (2) an intentional infliction of harm; (3) an unlawful distribution pursuant to D.C. Code section 29406.33; or (4) an intentional violation of criminal law.

Ballot Question 3:

NARFE National Executive Board Resolution: Secretary/Treasurer Salary Whereas, The strategic management of NARFE is evolving, and the hiring of an executive director to fulfill administrative and operational duties is now complete; and Whereas, The duties of the NARFE Secretary/Treasurer changed commensurate with this evolution; and Whereas, The duties of the NARFE Secretary/Treasurer may not justify a full-time salaried governance position and the duties of the NARFE Secretary/Treasurer continue to evolve; and Whereas, It is the fiduciary responsibility of the National Executive Board to ensure prudent use of the association’s finances and save costs where possible; and Whereas, Because the NARFE bylaws require that a membership vote be taken on changes to compensation of national officers, it is imperative that adequate advance notice be given to future candidates; now, therefore, be it Resolved, That beginning with the 2020-2022 term, the salary of the NARFE Secretary/Treasurer may be reduced to be commensurate with that workload by no less than 50% as determined by the NARFE National Executive Board.

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BYLAWS & RESOLUTIONS The Bylaws and Resolutions Committee report is below. For additional details, visit www. narfe.org/2018Balloting to download a PDF book that contains this report as well as proposals to amend NARFE bylaws (ballot items as well as all submissions), content of proposals acted on by the committee, and 2018 Bylaws Committee Rationale. Proposed bylaw amendment NEB01 is listed on p. 10.

BYLAWS AND RESOLUTIONS RECOMMENDED FOR ADOPTION NUMBER

SUBJECT

EFFECT

1802

NARFE Executive Director

Spells out duties of executive director

ADOPT

1803

Federations

Defines Federation membership/organization

ADOPT

1804

Committees

Redefines Committees

ADOPT

1805

Proxies

Disallows proxies on NEB

ADOPT

1811

Membership Lists and Labels

Removes language from standing rules

ADOPT

1818

Clarify National Membership

Replaces “national” with “association”

ADOPT

1824

Federations and Chapters

Incorporates OCM and OMOV into federations/chapters

ADOPT

BC01

Supporting Members (1806/1810)

Allows those supporting NARFE’s mission as nonvoting members

ADOPT

BC02

RVP Term Limits (1812/1817)

Restricts RVPs from serving more than three consecutive terms

ADOPT

Vacancies (1814/1822) Membership Forms (1832R/1833R/1834R/1836R/1845R)

Allows NEB to fill vacancy in president from NEB Requests review and possible redesign of membership forms

BC03 BCR-01

RECOMMENDATION

ADOPT ADOPT

BYLAWS AND RESOLUTIONS RECOMMENDED FOR REJECTION NUMBER

SUBJECT

1801

Term Limit Exception

1807

Access to Lists and Labels

1808

Timing of Ballot Votes

1809

Expand Federation Duties

1813

Reallocate Chapter Dues

1819

First Year Chapter Fee

1820

Publication of Roll Call Vote

1826

Publication of NEB Agendas

1827 1828 1829

Member Category Names

1840R

NARFE Cannot Do It Alone

1846R

Consolidation of Rosters

EFFECT Allow president to run for third consecutive term Defines access to labels for federation candidates Issue month of magazine coincides with conference

RECOMMENDATION REJECT REJECT REJECT

Federations become communication hub Reallocates new member dues from federations to chapters Extends period of chapter fee receipt to six months Requires publication of board votes on policy changes Requires publication of board agendas seven days in advance

REJECT

Changes to Regions

Requires two-thirds vote to change regions

REJECT

Renew Chapter Membership

Change to renewal form Changes “national” to “non-chapter” members Forms a new coalition of similar interest organizations Consolidates national and chapter member data

REJECT

REJECT REJECT REJECT REJECT

REJECT REJECT REJECT

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PROPOSED BYLAW AMENDMENT: NEB01 ARTICLE TITLE SECTION PROPOSED BY IX

AMENDMENTS

ALL

NATIONAL EXECUTIVE BOARD

Current Language: Section 1. Proposed Amendments A chapter, a federation executive board, a federation convention/conference, the NEB, or any special committee designated by the NEB may submit proposed amendments to these bylaws.

Section 2. Adoption Amendments to these bylaws require a two-thirds (2/3) vote for adoption by a ballot vote by the membership. This same procedure will be used to ratify decisions from the national convention.

Section 3. Convention Bylaws Committee Options The convention bylaws committee may recommend, with no increase in scope, proposed amendments to these bylaws or may combine similar proposed amendments, preparing a single substitute amendment for the body to consider.

Section 4. Revision Process Whenever a revision is ordered, at the convention at which the revision will be considered, no amendment to the current document will be considered.

Proposed Changes: Section 1. Proposed Amendments A chapter, a federation executive board, a federation conference/annual meeting convention, the NEB, or any special committee designated by the NEB, or a group of twenty members in good standing may submit proposed amendments to these bylaws. Amendments shall be submitted in the manner and by the deadlines established by the NEB. Amendments submitted at other times may be held for the next election ballot or be the subject of a referendum ordered by a twothirds vote of the NEB. Section 2. Adoption Amendments to these bylaws require a two-thirds (2/3) vote for adoption by a ballot vote by the membership. This same procedure will be used to ratify decisions from the national convention.

Section 2. Review The bylaws committee shall review and offer recommendations on all proposals, and may edit, combine, substitute, or reject proposals, informing the proposers promptly of the committee determination. A proposer whose proposal has been rejected or declared out of order may appeal to the NEB, whose decision by a two-thirds vote shall be final.

Section 3. Notice Notice of proposed amendments shall be published in the narfe magazine and/or posted on the NARFE website at least 30 days before the ballot deadline.

Section 42. Adoption A. Amendments to these bylaws shall require a two-thirds (2/3) vote of those responding to for adoption by a ballot vote by the membership. Such ballots shall be sent with the election ballot or at other times pursuant to an NEB authorized referendum, and shall be subject to a quorum of 350 ballots returned by the ballot deadline.

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Section 3. Convention Bylaws Committee Options The convention bylaws committee may recommend, with no increase in scope, proposed amendments to these bylaws or may combine similar proposed amendments, preparing a single substitute amendment for the body to consider.

Section 4. Revision Process Whenever a revision is ordered, at the convention at which the revision will be considered, no amendment to the current document will be considered.

If Adopted: Section 1. Proposed Amendments A chapter, a federation executive board, a federation conference/annual meeting, the NEB, any committee designated by the NEB, or a group of twenty members in good standing may submit proposed amendments to these bylaws. Amendments shall be submitted in the manner and by the deadlines established by the NEB. Amendments submitted at other times may be held for the next election ballot or be the subject of a referendum ordered by a two-thirds vote of the NEB. Section 2. Review The bylaws committee shall review and offer recommendations on all proposals, and may edit, combine, substitute, or reject proposals, informing the proposers promptly of the committee determination. A proposer whose proposal has been rejected or declared out of order may appeal to the NEB, whose decision by a two-thirds vote shall be final.

Section 3. Notice Notice of proposed amendments shall be published in the narfe magazine and/or posted on the NARFE website at least 30 days before the ballot deadline.

Section 4. Adoption Amendments to these bylaws shall require a two-thirds vote of those responding to a ballot vote by the membership. Such ballots shall be sent with the election ballot or at other times pursuant to an NEB-authorized referendum, and shall be subject to a quorum of 350 ballots returned by the ballot deadline.

Section 5. Revision Process Whenever a revision is ordered no amendment to the current document will be considered.

Rationale: This amendment remedies several issues with the current bylaws. For example, it sets a mail ballot quorum to define the minimum number of ballots to be returned for an amendment to the bylaws to be valid. In the absence of this mail ballot quorum, the default according to DC Code is a majority of all of the members, which is improbable to achieve. As there is no forum for debating bylaws amendments in person, the bylaws committee must be given the authority to act to refine and edit proposals before placing them on the ballot – with the addition of an appeal to the NEB should a proposer disagree with the committee’s finding. Without this amendment, there is no ability to amend the bylaws outside of the biennial ballot process. Last, the word “member” is removed as part of the current language because that was made as a conforming edit in error.

Bylaws Committee Recommendation: The Bylaws and Resolutions Committee recommends adoption.

Estimated Cost: None.

W W W. N A R F E . O R G

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Washington Watch

SENATE POSTAL REFORM BILL INTRODUCED

S

en. Thomas Carper, D-DE, introduced S. 2629, the Postal Service Reform Act of 2018, on March 22, with the support of three cosponsors: Sens. Jerry Moran, R-KS, Claire

McCaskill, D-MO, and Heidi Heitkamp, D-ND.

Like its House counterpart, the bill would require current United States Postal Service (USPS) retirees to enroll in Medicare Part B in order to continue receiving their current health insurance coverage through the Federal Employees Health Benefits (FEHB) Program, ultimately raising their overall health insurance premiums an additional $1,600 or more per year, despite the fact that they previously declined this coverage.

The goal of this requirement is to decrease USPS health insurance costs by shifting primary responsibility for retiree health care costs from USPS to Medicare. This shift in responsibility would cost taxpayers $10.7 billion over 10 years.

“This proposal seeks to balance the books of USPS on the backs of postal retirees,” said NARFE President Richard G. Thissen. “It 14

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would tell a 90-year-old postal retiree that he or she must pay another $1,600 or more per year in health insurance premiums to Medicare to keep his or her existing retiree health insurance plan, or lose it altogether, all while living on a fixed income.”

NARFE opposes the bill because it unfairly burdens tens of thousands of postal retirees and their survivors by changing the bargain regarding their health benefits after retirement, removACTION ALERT!

ing choice with regard to their health care and setting a dangerous precedent for all federal employees and retirees.

However, S. 2629 contains several improvements over the leading House postal reform bill, H.R. 756. In response to NARFE’s concerns, the bill contains important exceptions. First, the bill includes an exception for those living in a geographic area “in which there is a lack of participating Medicare Part B providers.” This allows those who retired overseas, for example, where doctors do not accept Medicare to be exempt from the new requirement. Second, it includes an exception for those who “would not derive benefit from enrolling in Medicare Part B

JUNE

Although a 2019 pay freeze may not affect you personally, this proposal is the most likely from the president’s fiscal year 2019 budget to gain traction in Congress. Legislators need to hear opposition from all NARFE members now. Use the Legislative Action Center to send a message, tweet or call your legislators today to oppose a federal pay freeze in 2019.

because of comprehensive medical coverage provided by the Department of Veterans Affairs or other programs.” Both of these provisions prevent the bill from imposing a new cost without any benefit for the postal retirees in question.

While most bills must be considered by the relevant com-

mittee, Carper, the bill’s sponsor, requested a special waiver, which allows the bill to bypass the committee process and be placed on the calendar for consideration. This would prevent the type of thoughtful attention, thorough review and commonsense amendments that commit-

tee consideration allows. NARFE is urging lawmakers to reject this process and object to consideration of the bill by the full Senate.

NARFE members can write and call their legislators and urge them to oppose S. 2629 and H.R. 756 via NARFE’s Legislative Action Center.

—BY JOHN HATTON, DEPUTY DIRECTOR, ADVOCACY

PRESIDENT’S MANAGEMENT AGENDA SEEKS TO IMPROVE PERFORMANCE

T

he Office of Management and Budget (OMB) released the President’s Management Agenda on March 20. The agenda seeks to improve government performance by focusing on three drivers of better government: IT modernization, a workforce for the 21st century, and data, accountability and transparency.

Those three drivers are identified as the first three cross-agency priority (CAP) goals. There are three additional “Cross-Cutting Priority Area” CAP goals: • Improving customer experience (CAP Goal 4) • Sharing quality services (CAP Goal 5) • Shifting from low-value to high-value work (CAP Goal 6) Finally the agenda identifies five “Functional Priority” CAP goals: • Category management (CAP Goal 7) • Results-oriented accountability for grants (CAP Goal 8) • Getting payments right (CAP Goal 9)

• Federal IT spending transparda does not appear to be driven ency (CAP Goal 10) primarily by political ideology.

• Improve management of major At the outset the agenda notes: acquisitions (CAP Goal 11) “This administration believes Each CAP goal will be the that modernizing the federal govresponsibility of an interagency ernment represents a profound team of senior federal leaders. bipartisan opportunity to work The administration seeks to across branches of government “drive government modernizaand political differences to align tion by working across functional the mechanics of government to disciplines and across agencies, better meet America’s needs.” rather than working in silos,” Both in substance and form, the according to the agenda, which is agenda appears, for the most available at www.whitehouse.gov/ part, to be a genuinely good faith omb/management/pma. effort to make government work OMB does not expect the better for the American people by agenda to change government partnering with the very federal overnight. This agenda is deemployees needed to make the scribed as a “vision for reform” agenda successful. that “must be multi-generational, Unfortunately, the agenda enabling the federal government contains unnecessary reference to adapt to changing needs over to the administration’s budget time. Rather than pursue shortproposals that take aim at earned term fixes that quickly become federal retirement benefits and outdated, this administration proposals to freeze or cut federal will pursue deep-seated transfor- compensation across-the-board, mation. But it will not happen in in exchange for a more limited one or two years.” pool of funds for performanceIn contrast to the administration’s budget proposals, the agen- (Management continued on p. 19) W W W. N A R F E . O R G

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Washington Watch

A RELIC FROM THE PAST, HOLMAN RULE THREATENS FEDS TODAY

I

n January 2017, the House of Representatives reinstated the Holman Rule, a little-known rule that allows an amendment to be offered during floor debate on an appropriations bill to do any of the following: reduce the number of employees at a federal agency; reduce the salaries of those employees, or even one particular employee; or eliminate one particular federal position. The Holman Rule bypasses committee consideration of any such proposal.

To provide greater context, you may have seen headlines in the news saying that Congress brought back a rule that allows them to reduce a specific federal employee’s pay to just $1. Yes, that’s the Holman Rule.

HIATUS AND REVIVAL The Holman Rule took a long hiatus from Congress. It was stricken from the rules in 1983, not to be revived until last year. However, the first version of the rule was enacted in 1876, which shows just how long it’s been around.

The Holman Rule goes all the way back to the 1830s. As the Congressional Research Service (CRS) reports, in 1835, it became apparent to House legislators that appropriations bills were being delayed because lawmakers kept trying to add seemingly unrelated matters to them. As funding became bogged down, a separation rule (not the Holman Rule) was created that mandated the separation of legislation from appropriations, broadly speaking.

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The effects of that separation rule helped shape the Congress we know today, with modern congressional rules continuing to divide questions of policy from questions of funding. In the decades that followed, the separation rule was construed to allow amendments to increase federal salaries and exclude those decreasing them. It’s important to remember that this was during the time of the patronage system, before the creation of the meritbased system in 1883.

Based on additional research from CRS, the 1835 separation rule was expanded at the suggestion of Rep. William Holman in 1876. This expansion effectively allowed the House Appropriations Committee to include legislative provisions in appropriations bills as long as they reduced “the number and salary of federal officials, the compensation of any person paid out of the Treasury, or the amounts of money covered in an appropriation bill.” Take a look at the first paragraph of this article … sound familiar? Thus, the Holman Rule came to be.

FAILED POLITICAL USE The Holman Rule stayed in Congress well after the creation of the modern merit-based civil service, going through a series of changes until it settled on its current language. The reinstatement of the Holman Rule could have major consequences for the federal workforce. In 2017, a politically motivated attempt was made using the Holman Rule to

abolish the Budget Analysis Division of the Congressional Budget Office (CBO). That attempt failed, but it jeopardized the jobs of 89 employees within CBO. When the Holman Rule was reinstated in the 115th Congress, it was set to last through 2017.

However, NARFE members should be aware that the rule was reinstated again and will last through 2018. This extension is concerning and NARFE will continue to monitor any further use of this rule and any of its impacts on the federal community.

—BY ROSS APTER, ADVOCACY ASSOCIATE

MYTH vs.

REALITY MYTH: Congressional budget deals, like the two-year budget agreement passed in February, determine agency budget authorities and spending levels.

REALITY: Congressional budget deals set top-line spending numbers for discretionary spending, which are hard caps that must be taken into account when Congress moves through the budget resolution and appropriations processes.

They do not set specific agency budgets. Rather, agency budget authorities and spending levels are set through appropriation bills, which is when money is finally distributed.

NARFE-PAC:

MEETING OUR GOALS

NARFE-PAC, the political arm of NARFE, works to defend your earned pay and benefits by building strong relationships between NARFE and members of Congress. Help us reach these important goals by November 6, 2018! Contribute to NARFE-PAC today!

Raise $1.5 million

$1.05 million

Disburse $1 million in political contributions

Grow monthly giving program (sustainer program) by 50%

Send NARFE members to 100 local fundraisers

$502,000

28%

50

Figures as of March 30, 2018

Contribute To NARFE-PAC I want to make a monthly sustainer credit card contribution:

q $25/month

OR

I want to make a one-time contribution: q $250 – Gold lapel pin and blanket q $100 – Silver lapel pin

q $10/month q Other: ______/month ($10 minimum) Sustainers receive a Sustainer lapel pin and cozy fleece NARFE blanket.

q $50 – Bronze lapel pin q $25 – Basic lapel pin q Other: _________

q Please do not send any gifts for my contribution (This saves NARFE-PAC money!)

NARFE Member #: _________________________________________ Name: __________________________________________________ Address: ________________________________________________ City: _________________________________________________ State: ___________

ZIP: _______________

Only members of the National Active and Retired Federal Employees Association may contribute to NARFE-PAC. NARFE will neither favor nor disadvantage anyone based on the amount of a contribution or the failure to make a voluntary contribution to this political action fund. NARFE-PAC contributions are not deductible for federal income tax purposes.

q Charge my credit card (required for monthly contribution) q MasterCard

q VISA

q Discover

q AMEX

Card #: ________________________________________________ Exp. Date: _____ /_________ mm

yyyy

Name on Card: _________________________________________ Signature: _____________________________________________ Date: _________________________

Or mail check payable to NARFE-PAC to: NARFE Attn. Budget & Finance 606 North Washington St. | Alexandria, VA 22314 W W W. N A R F E . O R G

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Washington Watch

OMNIBUS SETS 2018 FUNDING, BUT RISKS EMERGE FOR 2019 BUDGET

A

fter a series of five continuing resolutions kept the government running through the first half of fiscal year 2018 (FY18), an omnibus spending package was approved by Congress and signed by the president in late March. The omnibus funds the government through the remainder of FY18, which ends on the last day of September 2018.

The $1.3 trillion omnibus was set in motion after lawmakers broke months of gridlock and agreed to a two-year bipartisan spending agreement in February.

This agreement increased annual discretionary spending by $300 billion over two fiscal years.

Defense spending caps were increased by $80 billion in FY18 and by $85 billion in FY19. Domestic Legislative Resources • Legislative Hotline: A weekly update of legislative news, compiled by the NARFE Advocacy Department staff, distributed via email and available by phone (toll-free) at 800-456-8410, option 4 and online at www. narfe.org.

• Legislative Action Center: A one-stop site to send a letter to Congress, and more, at www.narfe.org.

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spending caps were increased by With funding set for the remain$63 billion in FY18 and $68 billion der of FY18, threats to earned pay in FY19. and benefits are no longer at risk The federal community was at through the FY18 budget process. risk during the negotiation of the However, negotiations on the FY19 two-year spending agreement, budget are already underway, but NARFE members answered meaning NARFE members need the call and contacted their to remain vigilant. legislators to protect the federal commuNegotiations on the FY19 nity. Offsets worth nearly $100 billion budget are already underway, were approved, but meaning NARFE members none came at the cost of federal emneed to remain vigilant. ployees’ earned pay and benefits.

The omnibus included a 2.4 As you may have read in previpercent pay increase for military ous narfe magazine articles, the personnel in 2018, breaking the president’s FY19 budget proposal previous four-year trend of pay contains a series of cuts targeting parity with civilian federal workthe pay and benefits of both curers. Federal employees received rent workers and retirees, going an average 1.9 percent pay raise so far as to reduce and eliminate earlier in 2018. cost-of-living adjustments for The omnibus supports the Unitcurrent retirees. NARFE members ed States Postal Service (USPS) have been voicing their concerns and its customers by continuing with their legislators with these six-day delivery and rural delivery, proposals, but we must keep the with the added stipulation that grassroots pressure on. service be no less than the 1983 Based on the Congressional level. It prevents any funding from Budget Act, Congress is meant to being used to consolidate and complete action on a FY19 concurclose “small rural and other small rent budget resolution by April post offices.”

15. However, it is unclear whether The omnibus also takes aim at lawmakers will move forward funding cuts or eliminations of with the budget resolution process federal programs based on presiwith spending caps set for FY19 dential budget requests. Specifical- through the two-year spending ly, these requests would have to be agreement. Nevertheless, NARFE approved by Congress. This added members should keep up with language is important because it the latest dealings of Congress means Congress would have to and be ready to take action in the approve any agency reorganization event that lawmakers take aim at plans, which have already been federal pay and benefits.

—BY ROSS APTER, ADVOCACY ASSOCIATE submitted to the president.

SUMMER HOLDS ENDLESS POSSIBILITIES FOR ADVOCACY ACTION

S

ummer is upon us, and it will be over before you know it. Save some space in your calendar for participating in NARFE advocacy efforts as you make your summer plans.

Members of Congress are scheduled to spend a significant amount of time in their home districts and states this summer.

They will return home the week of July 4 and for all of August, which is NARFE’s Grassroots Advocacy Month. Make these weeks count!

NARFE’s Advocacy Department asks all NARFE members to contact their legislators in the way they feel most comfortable.

Whether using NARFE’s Legislative Action Center to send a letter, tweet or phone call, or attending a congressional town hall meeting or event, all advocacy efforts help NARFE become recognized as the go-to resource for information about the federal community.

MIDTERM ELECTIONS AROUND THE CORNER Midterm elections are right around the corner so your legislators will be in the community

frequently in the lead-up to November. Federation leaders and Congressional District Leaders, where applicable, should start scheduling congressional meetings now because schedules fill up quickly. Don’t forget to meet with candidates for office. Plan ahead to make sure you and your fellow NARFE members connect with legislators by the end of August. More information about how to take action during Grassroots Advocacy Month will be sent via the weekly NARFE Legislative Hotline.

BUILD CONNECTIONS AT COMMUNITY EVENTS Community events, such as parades, picnics and carnivals, present the perfect opportunity to advocate for NARFE’s legislative priorities with legislators, staff and candidates. These informal environments are great for casual encounters and are beneficial to developing relationships. Elected officials and candidates may be seen connecting with community members at a farmer’s market or other community events to learn about constituents’ concerns firsthand. Use that opportunity to

(Management continued from p. 15) of budget savings. Such policies are more likely to undermine based pay raises. Such proposthe success of the agenda, rather als are not about modernizing than to promote it. federal compensation practices Fortunately, these elements of or recruiting and retaining a the agenda would require conwell-qualified federal workforce. gressional authorization. If the They are penny-wise, poundadministration is serious about foolish policies that scapegoat pursuing the agenda on a biparfederal employees in the name tisan basis, its budget proposals

spread the NARFE message.

Wear your NARFE gear at community events and briefly introduce yourself to the legislator and staff as a constituent and a member of NARFE. If you meet a staff member for the first time, exchange business cards so you can remember with whom you spoke. The next time you connect with the congressional office, remind the staffer of your conversation and where you met initially.

Members of Congress and staff have busy schedules and meet with many constituents, so keep your message succinct and easy to remember.

Look at the legislator’s website or in the local press for events the legislator will attend. Take advantage of events in your area and be sure to report back using NARFE’s Congressional Meeting or Event Feedback Form on the Action Center after the event.

If you have questions about how to take action this summer, contact advocacy@narfe.org or call 800-456-8410, option 3, to connect to the Advocacy Department.

—BY MOLLY CHECKSFIELD, GRASSROOTS PROGRAM MANAGER

targeting federal pay and benefits for drastic cuts will not see the light of day. Instead, it will be forced to focus on the vast majority of the agenda that seeks to partner with federal employees to make government work better for the American people.

Only time will tell.

—BY JOHN HATTON, DEPUTY DIRECTOR, ADVOCACY W W W. N A R F E . O R G

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Washington Watch

narfe bill tracker

THE NARFE BILL TRACKER IS YOUR MONTHLY GUIDE TO THE CONGRESSIONAL LEGISLATION THAT NARFE IS FOLLOWING. CHECK BACK EACH ISSUE FOR UPDATES. ISSUE

BILL NUMBER / NAME / SPONSOR

WHAT BILL WOULD DO

LATEST ACTION(S)

Requires postal retirees to enroll in Medicare in order to continue receiving their current federal health insurance coverage. Enrollment would be automatic.

Approved by the House Committee on Oversight and Government Reform; pending in two other committees Approved to bypass committee process. narfe, June 2018

Expresses the sense of the House that the U.S. Postal Service should take all appropriate measures to ensure the continuation of six-day delivery.

Referred to the House Committee on Oversight and Government Reform

H.Res. 31: As a resolution, it will not be sent to the president and, therefore, cannot become law / Rep. Dave McKinley, R-WV Cosponsors: 167 (D), 46 (R)

Expresses the sense of the House that the U.S. Postal Service should take all measures to restore service standards in effect on July 1, 2012.

Referred to the House Committee on Oversight and Government Reform

H.Res. 28: As a resolution, it will not be sent to the president and, therefore, cannot become law / Rep. Susan Davis, D-CA

Expresses the sense of the House that the U.S. Postal Service should take all measures to ensure the continuation of door-to-door delivery for all businesses and residential customers.

Referred to the House Committee on Oversight and Government Reform

H.R. 4775 / S. 2295: The Federal Adjustment of Income Rates (FAIR) Act / Rep. Gerald E. Connolly, D-VA Cosponsors (H.R. 4775): 48 (D), 1 (R) Sen. Brian Schatz, D-HI Cosponsors (S. 2295): 10 (D), 0 (R)

Provides for a 3 percent pay raise for federal employees in 2019.

Referred to the House Committee on Oversight and Government Reform (H.R. 4775) and the Senate Committee on Homeland Security and Governmental Affairs

H.R. 3269: Federal Employee Pension Fairness Act of 2017 / Rep. Anthony G. Brown, D-MD Cosponsors: 28 (D), 0 (R)

Repeals laws passed in 2012 and 2013 that increased the Federal Employees Retirement System (FERS) contributions for newly hired federal employees.

Referred to the House Committees on Oversight and Government Reform and Foreign Affairs narfe, October 2017

H.R. 1022: Federal Employees Paid Parental Leave Act of 2017 / Rep. Carolyn Maloney, D-NY Cosponsors: 78 (D), 1 (R)

Provides federal employees with 6 weeks of paid leave in connection with the birth or adoption of a child.

Referred to the House Committees on Oversight and Government Reform and House Administration

H.R. 756: Postal Service Reform Act of 2017 / Rep. Jason Chaffetz, R-UT Cosponsors: 10 (D), 8 (R) S. 2629: Postal Service Reform Act of 2018, Sen. Tom Carper, D-DE Cosponsors 1 (R), 2 (D) H.Res. 15: As a resolution, it will not be sent to the president and, therefore, cannot become law / Rep. Sam Graves, R-MO POSTAL REFORM Cosponsors: 181 (D), 65 (R)

Cosponsors: 184 (D), 57 (R)

FEDERAL COMPENSATION

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NARFE’s Position:

Support

Oppose

No position

EDITOR’S NOTE: These bills are all listed online at www.narfe.org/legislation/votervoice.cfm.

ISSUE

DC STATEHOOD

TAXES

COLA

GPO/WEP

BILL NUMBER / NAME / SPONSOR

WHAT BILL WOULD DO

LATEST ACTION(S)

H.R. 1291 / S. 1278: Washington, DC Admission Act / Del. Eleanor Holmes Norton, D-DC Cosponsors (H.R. 1291): 158 (D), 0 (R) Sen. Thomas Carper, D-DE Cosponsors (S. 1278): 21 (D), 1 (I)

Sets forth procedures that would allow the District of Columbia to become a state known as the State of Washington, DC.

H.R. 2929: Federal Employee Combat Zone Tax Parity Act / Rep. Rob Wittman, R-VA Cosponsors: 7 (D), 2 (R)

Extends the tax credit available Referred to the to military personnel who serve House Committee on in combat zones to civilian Ways and Means federal employees. narfe, September 2017

H.R. 3200: The TaxpayerFunded Pension Disclosure Act / Rep. Ron DeSantis, R-FL Cosponsors: 0 (D), 7 (R)

The legislation would allow for public disclosure of federal pension data, including: name of annuitant, last agency of employment, grade, monthly annuity and total annuity contributions.

Referred to the House Committee on Oversight and Government Reform narfe, October 2017

H.R. 1251: CPI-E Act of 2017/ Requires Social Security and Rep. John Garamendi, D-CA many federal retirement programs to use the Consumer Price Index for the elderly Cosponsors: 49 (D), 1 (R) (CPI-E) to calculate cost-ofliving adjustments (COLAs) to retirement benefits.

Referred to the House Committees on Ways and Means, Veterans’ Affairs, Oversight and Government Reform, and Armed Services narfe, May 2017

H.R. 1205 / S. 915: Social Security Fairness Act of 2017 / Rep. Rodney Davis, R-IL Cosponsors (H.R. 1205): 127 (D), 53 (R) Sen. Sherrod Brown, D-OH Cosponsors (S. 915): 18 (D), 4 (R), 1 (I)

Referred to the House Committee on Ways and Means (H.R. 1205), and the Senate Committee on Finance (S. 915) narfe, May 2017

Repeals both the Government Pension Offset (GPO) and the Windfall Elimination Provision (WEP).

Referred to the House Committee on Oversight and Government Reform, and Committee on Rules

The Access to Insurance for All Americans Act, H.R. 1408, has been removed from the tracker. The legislation has failed to garner any cosponsors and is unlikely to be considered by the House of Representatives. The Government for the People Act, H.R. 20, has been removed due to space. You can track cosponsors for the bill through the NARFE Legislative Action Center.

W W W. N A R F E . O R G

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Questions & Answers

The following Questions & Answers were compiled by NARFE’s Federal Benefits Institute staff.

NARFE does not provide legal, financial planning or tax advice or assistance.

EMPLOYEES RETIREMENT COVERAGE

Q

I had just under five years of creditable federal civilian service when I separated in 2006.

I was recently rehired in 2017 and my agency placed me under the Federal Employees Retirement System (FERS). Was this correct?

A

According to the details you provided, it appears that your agency may have made a mistake. From what you state, your break in service was more than three days; you did not have five years of previously creditable federal civilian service; and you were not covered under FERS on December 31, 2012, or December 31, 2013. Therefore, your agency should have given you FERS-Further Revised Annuity Employee (FERS-FRAE) retirement coverage when you were rehired in 2017.

It’s recommended that you ask your agency benefits/retirement officer to contact the Office of Personnel Management (OPM) with 22

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your case if they need assistance with your retirement coverage determination. You can also refer your agency to OPM’s benefits administration letter for more details (https://bit.ly/2IxfcPL).

If you should have received the FERS-FRAE retirement coverage but did not, the mistake might eventually be identified and corrected and the agency will most likely bill you for any amount of retirement deductions that should have been withheld retroactively, even though it was their mistake. If this happens to you, it’s recommended that you obtain your agency’s policy regarding overpayment of salary to properly understand your options

regarding the debt collection. If you have further questions about overpayments of salary, please contact OPM’s Pay Policy section in the Employment Service Department at 202-606-2858 or pay-leave-policy@opm.gov.

UNUSED ANNUAL LEAVE AND TSP

Q

I expect to receive a lump-sum payment for my unused annual leave shortly after I separate from federal service later this year and I won’t reach the annual contribution limit by that time. Will I be allowed to contribute this to my Thrift Savings Plan (TSP)?

A

Unfortunately, TSP doesn’t currently allow you to contribute from your lump-sum payment of unused annual leave upon separation from federal service, but

maybe someday we can convince them to change that. However, if you can afford to do so, it might not be a bad idea to increase your TSP contributions for the last pay period or two if you are expecting a fairly large lump-sum annual leave payment a short period later. That may help you accomplish the same goal. You also could speak with a certified financial planner to review other investment options, if desired.

SICK LEAVE RESTORATION

Q

I forfeited my previously unused sick leave balance when I returned to federal employment in 1991 after a break in service of more than three years. Can I now have that sick leave restored in light of the Office of Personnel Management’s (OPM) current sick leave regulations, which remove the threeyear break-in-service limitation?

A

Previously, OPM’s regulations in 5 CFR 630.502(b) provided that an employee was entitled to a restoration of previously unused sick leave if he or she was reemployed in another federal position within three years after separation. On December 2, 1994, OPM issued final regulations that removed the three-year break-in-service limitation on the restoration of sick leave for former employees who are reemployed on or after December 2, 1994. Unfortunately, since you were rehired in 1991, you were unable to have your previous sick leave balance restored. Sick leave may not be

restored to employees who were reemployed in federal service prior to December 2, 1994, and who previously forfeited sick leave under the former rule.

SICK LEAVE CREDIT FOR FERS ANNUITY

Q

I’m planning to retire from federal service under the Federal Employees Retirement System (FERS) on December 31. I’ll be 63 years old with 19 years and six months of creditable service.

I project that I’ll have enough unused sick leave hours by the end of this year that will equate to seven months of sick leave credit in the computation of my annuity. I really want to retire on December 31 so I can maximize the lump-sum payment of unused annual leave that I can expect to receive in January, but my agency retirement officer has told me that I won’t have the 20 years necessary to receive the enhanced computation of my annuity. She told me that unused sick leave cannot be used to qualify for the 1.1 percent factor in the FERS computation formula. Does this mean that I have to keep working until summer of next year?

A

Based on the information that you provided, your agency is incorrect.

Since you will be age 62 or older on December 31 of this year, the seven months of sick leave credit will be added to the 19.5 years of creditable service when the

Office of Personnel Management (OPM) computes your annuity, therefore giving you the minimum 20 years necessary to allow them to use the 1.1 percent factor in the computation of your annuity. There would be no need for you to change your plans to retire on December 31.

You can still maximize the benefit of receiving the lump-sum payment of unused annual leave in January while simultaneously looking forward to receiving the enhanced annuity that you earned. Ask your agency retirement officer to contact OPM for the proper details that will allow them to provide better counseling to future employees who are planning their retirement from federal service.

RETIREES TSP MANDATORY WITHHOLDING

Q

It’s my understanding that Thrift Savings Plan (TSP) will withhold 20 percent of my partial withdrawal for the IRS. I retired at age 56, with more than 30 years of service. If the 20 percent is more than my federal tax rate, is the overpayment refunded to me when I file my federal income tax return next year?

A

Yes. If the mandatory 20 percent minimum withholding for federal income taxes on your partial withdrawal from the TSP W W W. N A R F E . O R G

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23

Questions & Answers

causes you to withhold more taxes than your overall federal tax liability for taxable income for that year, you can expect to receive a refund when you file your tax return. You will receive a 1099-R form (reflecting both your taxable distribution and withholding) from TSP in January following the year in which you made the withdrawal so you can include this with your tax return. Optionally, you could speak with a tax advisor to assist you with making withholding changes to other sources of income to help you meet your tax goals for the year.

WHICH FEHB FORM WORKS BEST?

Q

As an annuitant who is married to a federal employee, I understand that I must cancel my Federal Employees Health Benefits (FEHB) Program plan if I want to be covered under my spouse’s FEHB plan. I noticed that both the Office of Personnel Management (OPM) Form 2809, “Health Benefits Election Form,” and the RI 79-9 form, “Health Benefits Cancellation/Suspension Confirmation,” allow me to cancel my coverage for this purpose.

Which form does OPM prefer that I use?

A

Although the OPM Form 2809 allows annuitants to cancel their FEHB coverage when covered by a spouse’s FEHB plan, some annuitants have experienced difficulty when submitting this form to OPM because it looks very similar to the Standard Form 2809. For the purposes of either canceling FEHB (to be covered under a spouse’s FEHB plan) or suspending FEHB (for coverage such as TRICARE or Medicare Advantage plans), it’s recommended that you use the RI 79-9 form instead. Annuitants can reserve the use of the OPM Form 2809 to make other changes.

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Questions & Answers

FEHB COVERAGE RESTORATION

Q

As an annuitant married to a federal employee, if I cancel my Federal Employees Health Benefits (FEHB) Program once I’m covered under my wife’s FEHB plan, can I get my coverage back later if desired?

A

Yes, as long as you are continuously covered as a family member on your spouse’s FEHB plan, you will be eligible to resume your own enrollment if your coverage under your spouse’s enrollment ends for any reason.

For example, if you lose your spouse (death or divorce) or if your spouse wants to switch to a Self Only plan later, you would be allowed to get your FEHB coverage back under your own plan. Be sure that your spouse’s agency and the Office of Personnel Management (OPM) coordinate the effective date of these FEHB adjustments so they occur simultaneously. In other words, the same day that you are added to your spouse’s plan will be the same day that OPM cancels your FEHB. As an annuitant, you can cancel your FEHB anytime.

The date that OPM cancels your FEHB should be the same date

that your federal spouse adds you to her plan.

MOVING TO A NEW STATE

Q

Later this year, I’m moving to a state that taxes federal pensions. How do I contact the Office of Personnel Management (OPM) and ask them to begin the withholding for state taxes?

A

The easiest method would be to use OPM’s Retirement Services Online to start, change or stop the state tax withheld from your annuity payment. Visit https://www.

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Questions & Answers

servicesonline.opm.gov.

You must specify the dollar amount of state tax you want withheld from your monthly payments. The withholding must be in whole dollars. The minimum amount OPM can withhold for state income tax is $5.

If you use OPM’s Retirement Services Online, you can also change your mailing address and bank account information, if desired.

Alternatively, you can call OPM at 888-767-6738 or you can write to OPM to change your withholding amount. If you write, your letter should include your claim number and the monthly amount

in dollars you want withheld.

If you do not know the monthly amount you want withheld, contact your state tax office for information or assistance. Make copies of your request and send it via certified mail to: U.S. Office of Personnel Management, Retirement Operations Center, P.O. Box 45, Boyers, PA 16017.

To obtain an answer to a federal benefits question, NARFE members should call 800-456-8410 and select option 2 for the Federal Benefits Institute; send the question by postal mail to NARFE Headquarters, ATTN: Federal Benefits; or submit it by email to fedbenefits@narfe.org.

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Call NARFE at:

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Working After Retirement

FEDERAL BENEFITS IN-DEPTH

BACK TO WORK FOR THE

FEDERAL GOVERNMENT F

rom time to time, agencies find that the best person for the job is a federal retiree. Due to laws regarding dual compensation, unless the Office of Personnel Management (OPM) grants a waiver or unless preauthorized under the National Defense Authorization Act for fiscal year 2010, P.L. 111-84, the reemployed annuitant’s salary is usually reduced by the amount of the annuity they continue to receive from OPM. This lack of waiver or preauthorization permits the reemployed annuitant the opportunity to earn entitlement to additional annuity income and also allows for TSP contributions upon return to federal service. This will be the focus of a future “Federal Benefits In-Depth” article.

If the reemployment position isn’t already preauthorized for a waiver under P.L. 111-84 (which has been extended to the end of 2019), under special circumstances, the agency can submit a request to OPM to waive this offset under the Federal Employees Pay Comparability Act. Visit the following websites for additional guidance on this topic at https://bit.ly/2qBkSC2, https://bit.ly/2Jwa13l or https://bit.ly/2Hzagd1.

RETIREMENT BENEFITS How would federal retirement benefits be affected for someone returning to federal service after voluntarily retiring under the Federal 30

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Employees Retirement System (FERS) with the waiver or preauthorization? Let’s answer this question by looking at the retirement benefits. (Note that the benefits below may be different if someone receives a disability retirement or Civil Service Retirement System involuntary retirement.)

Retirement Income - It is important that your agency notifies OPM regarding your federal reemployment. If you are receiving a regular voluntary retirement under FERS, your regular annuity from OPM will continue, unaffected by your new federal job.

Since the hiring agency has an approved waiver (or preauthorization) and doesn’t plan to reduce your salary for the amount of FERS annuity you are receiving, they will not withhold any contributions for FERS and therefore you would not earn any additional entitlement to any additional FERS annuity.

Although you may earn both annual leave and sick leave during this period of reemployment, the sick leave accrued would not be used toward computation of any annuity income.

You won’t be allowed to contribute to your Thrift Savings Plan (TSP). As a FERS annuitant, the only withholding from your employee salary that might benefit your future retirement income would be the mandatory Social Security tax, based on

your type of appointment.

If you are receiving a FERS Annuity Supplement from OPM, the wages earned as a reemployed annuitant are considered earnings that should be included when responding to OPM’s annual FERS Annuity Supplement Earnings Report. Your reemployment wages might reduce the amount of FERS

Annuity Supplement payable.

Voluntary Separation Incentive Payment (VSIP) - If you received a buyout from your agency upon your previous separation, you must repay the entire amount back to that agency if you are returning to federal service within five years.

Federal Employees Health Benefits (FEHB) - If you are reemployed in a position that conveys FEHB eligibility, you may have the opportunity to transfer your FEHB to your employing agency so you can benefit from paying your premiums on a pretax basis through premium conversion. When you separate from reemployment, you will be able to transfer

your FEHB back to your retirement with OPM and the premiums will not be withheld on a pretax basis.

Federal Employees’ Group Life Insurance (FEGLI) - If you are reemployed and the position is FEGLI eligible, any Basic insurance you carried as an annuitant is suspended with OPM. If enrolled in Option A and Option C, those coverages you carried as an annuitant are also suspended. You automatically get Basic, just like any other employee, based on your reemployment salary. You automatically get Option A and Option C insurance as an employee, if enrolled as an annuitant.

Option B is handled differently from Basic, Option A and Option C. If you have Option B as an annuitant and are reemployed in a position that does not exclude coverage, you must be given the opportunity within 60 days of reemployment to choose whether to keep Option B as an annuitant or have it as an employee. Since Option B as an annuitant was based on your previous federal employment salary, you may wish to weigh this option upon reemployment.

Once you separate from this reemployment position, any FEGLI coverage you temporarily transferred to your agency would be transferred back to your annuity with OPM (based on the FEGLI elections you originally made

and based on your final salary when you initially retired).

Federal Employees Dental and Vision Insurance Program (FEDVIP) - If you are enrolled in FEDVIP as an annuitant and you are returning to work in a position in which you are eligible for FEDVIP, you must contact BENEFEDS (877-888-3337), if you want your premiums to be deducted from your paychecks.

Most reemployed annuitants want to make that change because retirees pay FEDVIP premiums with post-tax dollars and employees pay FEDVIP premiums with pretax dollars.

If your new position is not eligible for FEDVIP, you may retain the coverage as an annuitant.

If you are not already enrolled in FEDVIP, you may enroll as a newly hired employee within 60 days after you start your reemployment position.

Flexible Spending Accounts for Federal Employees (FSAFEDS) - You may be able to enroll in a FSAFEDS health care flexible spending account and/ or dependent care account within 60 days upon rehire, if your agency participates in FSAFEDS. For the health care account, you must also be eligible to enroll in the FEHB Program with the rehired position. Not all reemployed annuitant positions allow for FEHB coverage. In those situations, the annuitant would keep their FEHB with their annuity. However, if the

position allows FEHB coverage, you cannot enroll with FSAFEDS if you are being rehired after October 1, as you would have to wait until the upcoming Open Season.

Federal Long Term Care Insurance Program (FLTCIP) - As a reemployed annuitant, your FLTCIP coverage will not be affected.

Your coverage will remain in effect as long as you continue to pay premiums. But if you pay your premiums through annuity deduction, you will need to contact Long Term Care Partners at 800-LTCFEDS (800-5823337) if you want to make other billing arrangements. In most cases, you can have your premiums deducted from your salary, if you wish.

If you are not enrolled in FLTCIP, as a newly reemployed annuitant you can apply for coverage within 60 days of your reemployment using the Abbreviated Underwriting Application.

You can apply at any time using the Full Underwriting Application.

—JAMES MARSHALL, DEPUTY DIRECTOR, FEDERAL BENEFITS INSTITUTE. W W W. N A R F E . O R G

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Cover Story

CIVIL SERVICE SYSTEMS

AROUND THE WORLD:

How Does the U.S. Compare?

BY DAVID TOBENKIN

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In a tough environment for U.S. federal civil servants, federal employees could be forgiven for asking whether life would be better as a civil servant elsewhere in the developed world.

Academics who have actually studied and compared different nations’ civil service systems say it depends. Among developed countries, they say American civil servants’ pay and benefits generally appear to be somewhere in the middle. The job functions of civil servants in the U.S. and abroad share many similarities, although there are some significant differences. U.S. civil servants also face a level of distrust and disrespect that is notable compared to many world peers.

W W W. N A R F E . O R G

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A Difficult Comparison

There are not many detailed comparative studies of U.S. and foreign civil servants and many that do exist tend to be dated, lack quantitative comparative data for the U.S., or focus on comparisons of only top-tier civil servants. In part, this reflects that civil service comparisons appear to primarily be of interest to academics. The hot-button debate in the U.S. regarding whether federal employees are over or underpaid has tended to focus on comparisons between federal employees and their private-sector counterparts, not comparisons between U.S. and foreign counterparts.

There are large differences between civil service, taxation and social support systems that make comparisons inherently difficult. For example, in some countries like France, the national civil service includes positions that would be local or state government positions in the U.S., such as school teachers.

Benefits, in particular health and pension, can be difficult to compare across different civil service systems. In many developed world countries, including much of Europe, Canada and Australia, all or nearly all citizens enjoy universal health care.

Thus, while U.S. federal employees enjoy a wellregarded and subsidized health insurance system that is relatively high quality and often better financially supported compared to the rest of the population, civil service peers in many developed countries pay higher taxes but enjoy a higher level of covered care.

The U.S. Civil Service System in Context

Some general trends in developed countries have moved many civil services in the same direction, says Jos C.N. Raadschelders, professor and associate dean for faculty development at Ohio State University and co-author of the textbooks “Comparative Civil Service Systems in the 21st Century” (2015) and “Global Dimensions of Public Adminis34

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tration and Governance” (2015). First, the overall size of the public workforce in many developed nations has increased significantly as a function of citizen demand, Raadschelders notes. Second, to assure professionalism within the career civil service, politics and administration have come to be regarded as separate functions, with politicization only at the higher career civil service ranks.

In addition, professionalism in the career civil service generally has been enhanced by means of standardizing the personnel function as much as possible through creation of job descriptions, job interviews, rules for promotions, and performance management and measurement. This has generally resulted in less corruption in civil services in much of the developed world.

Civil services also tend to reflect the societies in which they emerge.

Civil services also tend to reflect the societies in which they emerge. For instance, Professors Martin Painter and B. Guy Peters have distinguished between nine traditions: AngloAmerican, Napoleonic, Germanic, Scandinavian, Latin American, Postcolonial South Asian and African, East Asian, Soviet and Islamic. Thus, a U.S. civil servant’s experience in another country would likely be affected by such norms.

Salaries

Generally, as measured by pure salary, the U.S. is in the middle to upper-middle of salary ranges, several academics and comparative studies suggest.

An Organization for Economic Co-Operation Development (OECD) 2015 study assessed the average annual compensation of central government senior managers, as measured by combined wages and salaries, social contributions to health and pensions and working time adjustments tied to holidays. The study found that the U.S. was among the top-paying jurisdictions. A similar OECD measure of average annual compensation for central government middle managers contained in the same OECD study, “Government at a Glance 2017,” also found the U.S. near the top in terms of compensation.

The study found that for U.S. middle managers, the ratio of compensation to GDP per capita was slightly below the OECD average and well below the per capita leaders, Columbia and Mexico, and also considerably below Canada, France and Germany.

That, of course, fails to take into consideration the relative cost of living in those societies. When that adjustment is made, the U.S. rankings for those positions are considerably less competitive.

The 2015 OECD comparison of average annual compensation of central government senior officials relative to gross domestic product (GDP) per capita found that the U.S. was significantly below the OECD average and behind per capita leaders such as Italy, Mexico and Columbia. The study found that for U.S. middle managers, the ratio of compensation to GDP per capita was slightly below the OECD average and well below the per capita leaders, Columbia and Mexico, and also considerably below Canada, France and Germany. A comparison

by Peters, Marleen Brans and Bart Verbelen of annual base salary compensation of senior civil servants in the U.S., 14 European countries and the European Union from 1992-2008 showed that U.S. compensation appeared to be in the middle to upper middle of the pack during that period.

While the 2017 OECD report compared compensation for professionals in central government across OECD countries, that data was not submitted for the U.S., making comparisons impossible.

Top civil service positions in the city-state of Singapore enjoy annual salaries that are far higher than in the U.S.

There are civil service compensation outliers, notes Peters, a professor of political science at the University of Pittsburgh and president of the International Public Policy Association. Top civil service positions in the city-state of Singapore enjoy annual salaries that are far higher than in the U.S., says Peters. This in part reflects a deliberate strategy to use highly trained, highperforming civil servants as a core element of Singapore’s trade and finance economic strategy.

The civil service in Singapore has been actively involved in major economic initiatives of this heavily planned society that have transformed a poor country into one of the most wealthy, on a per capita basis. Such compensation reflects the viewpoint of the first Prime Minister of Singapore and the founder of its economic model, Lee Kuan Yew, who once famously said, “you pay peanuts, you get monkeys.” Singapore’s highrisk, high-reward model entailed some risks for civil servants in the system, as the government invested the pension savings of its public employees in the state’s economic growth, a policy that W W W. N A R F E . O R G

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has paid off to date for both Singapore and its civil servants.

Hong Kong civil servants also are paid better than American civil servants, receiving two to four times as much salary, says James L. Perry, professor emeritus at Indiana University, Bloomington’s School of Public and Environmental Affairs. “It’s part of the British colonial legacy,” Perry says.

“They wouldn’t send their expats to Hong Kong to toil at low wages for a long time.”

The level of compression in pay between the most junior and least-compensated and the most senior and best-compensated civil servants varies in different countries. “In Scandinavia, for example, you tend to do relatively better compared to the private sector for a given level of seniority at the lower level, whereas in France it is much more hierarchical and you do much better at the top and you start out low at the bottom,” says Peters. “The U.S. is in the middle. Across countries, with respect to compensation, civil service is usually a good place to begin a career but less so to end one.”

Another significant difference between the U.S. civil service and others is that in most U.S. civil service positions, federal employees can enjoy continued high-paying senior years in the service, adding to the service years multiplier of their annuities, through additional years of civil service.

For many who rely on work to enhance their social lives, that is a social benefit as well. In part, this reflects U.S. federal laws that protect employees age 40 and over from age discrimination. In other countries, civil servants face mandatory retirement at a relatively young age, such as age 66 to 70 for different employee classes in Italy or age 70 for Ireland. “Many European states have a standard retirement age of 65-67 and have mandatory retirement for civil servants despite their being perfectly capable of continuing to work,” Peters says.

Benefits

For U.S. federal civil servants, annual leave runs 36

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from 13-20 days per year for employees with less than 15 years of service, plus 10 federal holidays, which is somewhat less generous on average than in Western Europe. By European Union law, every country in the European Union provides civil servants with at least four weeks (20 days) of paid vacation and some countries exceed this number. Austria has the most annual leave, with 25-30 days of paid vacation, depending on seniority, and 13 paid holidays per year. More veteran U.S. federal employees do better, however, as those with 15 or more years of seniority earn 26 days of annual leave per year, which is relatively more competitive with the more generous developed world leaders. “ I thought comparatively, from my experiences, [Belgium’s] system was much better in health care coverage and quality.”

– James L. Perry

As noted, many developed world countries have universal health care systems of varying quality and coverage. “I lived in Belgium as a senior scholar at the KU Leuven Public Governance Institute and paid into their health care system from my university stipend, which gave me access to their entire single-payer health care system,” Perry says. “I thought comparatively, from my experiences, their system was much better in health care coverage and quality.”

One health care factor that burdens U.S. public and private employees alike, relative to foreign peers, is the enormous cost of care, compared to health care costs elsewhere.

“ Our federal civil service is lean compared to many other countries that are unitary and have a broader mission.”

– James L. Perry

What Civil Servants Do

Generally, there is a great deal of similarity in the job functions of national-level civil servants, with the already noted exception of countries in which civil services include positions that would occur at the state and local level in the U.S., such as teachers.

A 2008 OECD publication found Australia had about 12 percent of all public-sector employees at the federal/national level, while Turkey had almost 90 percent at the national level. The U.S. was around 14 percent. “Our federal civil service is lean compared to many other countries that are unitary and have a broader mission,” Perry says.

Another area of distinction is that more toptier U.S. federal civil service positions are held by appointees, rather than career civil servants, notes Perry. This means that U.S. civil servants cannot aspire, through long service and technical competence, to those top spots. The consequences for transparency and professionalism are that political appointees may have little technical competence and tend to occupy leadership roles in agencies and other civil service bodies for shorter periods, Raadschelders notes. “It makes a civil service comparatively less effective since most political appointees are in their positions for only short periods,” he says. “Civil service can become a resume-building exercise rather than trying to do something for the public at large.”

Anecdotally, the U.S. is also somewhere in the middle with respect to core attributes of civil services, transparency and lack of corruption, in the estimate of some experts. Many civil services worldwide face similar challenges, such as how to control the proverbial revolving door of individuals leaving national service for more lucrative privatesector employment, with the potential for staff depletion and corruption. In Japan, the practice is known as amakudari – the practice of retired bureaucrats’ “parachuting” into lucrative jobs in sectors they formerly regulated.

Respect in Society

It is clear that negative stereotypes of civil service are common across societies, Raadschelders notes.

These stereotypes include the perception that civil servants do little work, primarily shuffle papers, focus on their offices over actual results and are inferior to private-sector employees.

“ In France, lower level civil servants, especially ‘local’ civil servants, are often attacked as unnecessary, though the national civil service has been the target of stringent cuts since 2008, which has reduced that perception.”

– A Civil Servant from the French National School of Administration

Others say civil service reputations can often depend upon which civil servant is being described.

“In France, lower level civil servants, especially ‘local’ civil servants, are often attacked as unnecessary, though the national civil service has been the target of stringent cuts since 2008, which has W W W. N A R F E . O R G

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“ Still, you will receive most of your satisfaction not from a financial legacy, but instead from serving your country. To me, the American system is the model for the world.”

– James L. Perry

reduced that perception,” said an administrateur civil (“civilian administrator”) from the French National School of Administration (ENA) who worked extensively with U.S. civil service colleague counterparts and who requested anonymity. “However, higher level civil servants (from ENA and the like) are perceived as both a brilliant and respected elite and as out-of-touch-with-reality technocrats.

They are attacked as stifling France with regulation, and yet everyone would be happy if their child were to join that group.”

Of all Western countries, Americans have a particular distrust of civil servants, Raadschelders says. “While this in part reflects civil servants’ reaction to the tone and actions of the current administration, the underlying disrespect is not just a recent development. Americans have an inborn distrust of anyone appointed. You see that in the variety of public positions in the U.S. that are elected rather than, in most other developed world countries, appointed by peers based upon proven abilities, such as sheriff and judges.”

The Bottom Line

Some say taking all the considerations described as a whole, U.S. federal civil servants have enjoyed a relatively good ride to date aboard a relatively good system compared to foreign counterparts.

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“We expect from our civil servants high levels of effort and for them to be highly dedicated to mission,” says Perry. “In some respects, the ability to serve a societal mission is payment of different kind. The idea is that we’ll pay you a reasonable wage and you will get a lot of satisfaction and provide a lot of social benefit – that will be part of your compensation. And at the end of your service, you will be solidly middle class. Still, you will receive most of your satisfaction not from a financial legacy, but instead from serving your country. To me, the American system is the model for the world.”

—DAVID TOBENKIN IS A FREELANCE WRITER BASED IN THE GREATER WASHINGTON, D.C. AREA.

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Reach for the Stars

Federal Leadership Development Programs to Transform the Way You Lead

BY EVERETT A. CHASEN

The federal government needs strong, creative, committed leaders in every agency.

The rapidly accelerating pace of change, the desire to make the government operate more like a business, and the continuing need to guide employees to work together productively means those who can successfully manage others will always be in great demand.

W W W. N A R F E . O R G

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“The Office of Personnel Management (OPM) emphasizes the need to develop a leadership pipeline from the aspiring leader through the frontline supervisor, manager and executive,” says Julie Brill, acting deputy associate director for Senior Executive Service and Performance Management at OPM. “In addition to considering candidates from outside their own organizations, agencies should work to create and nurture the development of a home-grown pipeline of candidates.”

If you’re a federal employee looking to advance into a leadership role, there are lots of ways to get the training you’ll need to be successful. This article will highlight training opportunities available to you, explain how to evaluate them and get the most out of the ones you’re attending, and offer additional suggestions on how to become a better leader.

OPM provides multiple tools to federal agencies to help support today’s leaders, including leadership development courses and other assistance. In 2015, the agency issued frameworks and guidance to help agencies develop current and aspiring supervisors and managers. The frameworks incorporate mandatory training, recommended training, and the leadership competencies and human relations technical knowledge employees need to succeed as a supervisor and manager.

Federal agencies are required by regulation to provide new supervisors initial supervisory training within a year of their appointment, and whenever employees make career transitions to higher supervisory levels. The frameworks also provide materials to help agencies evaluate the effectiveness of their supervisory and management development program. OPM also provides a framework for continued supervisory learning for members of the Senior Executive Service (SES), the capstone level of the federal leadership journey.

CENTER FOR LEADERSHIP DEVELOPMENT PROGRAMS

OPM’s Center for Leadership Development (CLD) is charged with executing and cultivating their leadership development philosophy and provides programs and courses for federal employees who want to develop their leadership potential.

CLD’s Leadership Education and Development (LEAD) certificate program offers courses that assess enrollees’ current leadership effectiveness and potential; present an overview of the key competencies that are critical to success; provide essential knowledge of government-wide policy; and feature intensive development of workplace-relevant skills.

CLD’s Leadership for a Democratic Society program, conducted at the Federal Executive Institute (FEI) in Charlottesville, Virginia, is a four-week training program challenging government executives to reach beyond their past practices to embrace a broader perspective of governance. The program also aims to develop new leadership capacity to better serve and support the American people.

CLD’s SES Leading EDGE program helps new SES members succeed in their first two years of executive service through a series of four five-hour programs, designed and delivered by the FEI, which are offered every two months in Washington, DC. “We provide centralized resources that can be useful to organizations’ or individuals’ talent development needs – from recruitment and development of innovative leaders to a continuum of learning for workforce readiness and a supportive learning infrastructure,” explains Suzanne Logan, director of CLD and the FEI. “We conduct research to understand the ever-changing needs of today’s federal workforce in order to position the government for future challenges.”

“This year marks FEI’s 50th anniversary, and it continues to challenge federal leaders with innovative new thinking regarding talent development in the public service.”

– Suzanne Logan, director of CLD and FEI 42

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LEADERSHIP TRAINING RESOURCES FOR FEDERAL EMPLOYEES

CLD also holds thought leader meetings and leadership networking events for federal employees and prepares publications and social media communications to help the organization lead the conversation about public service talent and leadership development.

“This year marks FEI’s 50th anniversary,” Logan tells us, “and it continues to challenge federal leaders with innovative new thinking regarding talent development in the public service.”

CLD has more than 100 full-time employees, intermittent federal faculty members, contracted adjunct faculty members, and a number of fellows from a variety of fellowship programs. In 2017, approximately 14,000 people participated in one or more of its leadership development programs.

For those who have recently completed a graduate degree program, CLD offers the Presidential Management Fellows (PMF) program, a flagship leadership development program offering two-year appointments to government positions. The program features formal interactive training, challenging work assignments, networking opportunities, regular work feedback and immediate noncompetitive conversion to permanent or term positions with the government on successful completion of the program.

The center’s USALearning program helps other federal agencies develop their own leadership programs by providing customized learning management systems, a learning content management system, communities of practice and other customized content and collaborative platforms.

Department of Commerce’s Aspiring Leaders Development Program (ALDP):

MANAGER’S CORNER

NSA’s Leadership Development Program:

OPM’s Manager’s Corner includes a wide array of tools, training courses and resources to help federal leaders enhance their human resources-related technical and leadership competencies. The agency’s federal coaching network brings together a community of more than 300 individuals across government who are deeply invested in the practice of coaching and seek to broaden its role in leadership and executive development.

INTERAGENCY ROTATION PROGRAM

The Interagency Rotation Program provides exposures to other agencies for high-potential employees who are at the General Schedule (GS) 13-15 level and has had more than 800 participants to date. OPM is working closely with Federal Executive Boards (FEBs) around the country to expand the program to field offices throughout the nation.

https://bit.ly/2GOQMVJ Department of the Interior Leadership University (DOIU):

https://doiu.doi.gov/leadership.html Federal Executive Institute (FEI):

https://bit.ly/2JyoH2E Graduate School USA:

http://www.graduateschool.edu/ Health and Human Services (HHS) Emerging Leaders Program:

https://hhsu.learning.hhs.gov/elp.asp LEAD Certificate Program:

https://bit.ly/2GP2EH6 Leadership VA (LVA):

https://www.valu.va.gov/SlickSheet/View/67 NOAA’s Leadership Competency Development Program (LCDP):

http://lcdp.noaa.gov/ https://bit.ly/2GRdIDK OPM’s Center for Leadership Development (CLD):

https://leadership.opm.gov/ OPM’s Manager’s Corner:

https://bit.ly/2JzjVlr Presidential Management Fellows Program:

https://www.pmf.gov/ SES Leading EDGE program:

https://bit.ly/2HbxrgQ White House Leadership Development Program:

https://pic.gov/whldp W W W. N A R F E . O R G

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AGENCY TRAINING PROGRAMS

In addition to OPM’s efforts, other federal agencies have their own training programs to develop their employees.

“OPM collaborates closely with agencies across the federal government to implement applicable laws, serve their needs and learn from their practices,” says Logan.

Many agencies offer Senior Executive Service Candidate Development Programs (SESCDP) designed to identify and prepare aspiring senior executive leaders.

These programs develop SES candidates’ competencies in each of the Executive Core Qualifications (ECQs) required for appointment to the service. Graduates of SESCDPs certified by OPM’s Qualifications Review Board may receive an initial career SES appointment without further competition, although certification does not guarantee placement in the SES and participation is not required for SES selection.

Logan cited training provided to employees at three federal agencies, the Agency for International Development, the National Oceanic and Atmospheric Administration and the National Security Agency, each of which worked with OPM to develop an agency-centric series of leadership development programs. Some agencies, such as the U.S. Department of Agriculture, offer leadership training open to employees of all agencies.

Other agencies have developed programs to help employees build strategic leadership skills needed to take on executive leadership roles within their agencies, while maintaining an agency-wide perspective. The following agencies are among those that have developed leadership programs: • Department of Commerce’s Aspiring Leaders Development Program • Army War College’s Center for Strategic Leadership • Naval War College Naval Leadership and Ethics Center • Department of Health and Human Service’s Emerging Leaders Program; • Department of Interior leadership programs at the U.S. Fish and Wildlife Service, U.S. Geological Survey and the National Park Service • U.S. Forest Service’s “Grey Towers” program • Department of Veterans’ Affairs Leadership VA (LVA) program Jan Northstar, a 2016 LVA graduate, said the program was a great opportunity.. “I had been in government for a long time when I decided to apply,” she says. “I am always 44

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“I took a long time to decide to go, but I would recommend the experience even to those who have spent many years working in the agency.”

– Jan Northstar, 2016 LVA graduate

looking to see what I don’t know about my own organization. LVA brought me up to speed on various VA operations, policies and specifically the reorganization going on at the time.”

Northstar, a public affairs director, signed up for an innovation project “that was completely out of my lane. It was designed to help veterans get faster information on their benefits claims and appeals through videoconferencing.” She met 100 current and future VA leaders, most of whom she did not know beforehand, and organized a media training session for her classmates that was added to the program. “I worked with lawyers, doctors, hospital administrators, even a judge, and learned what they were thinking about VA’s future.”

“It was a great experience,” she concludes, “and I got out of it exactly what I thought I should. I took a long time to decide to go, but I would recommend the experience even to those who have spent many years working in the agency. We often get trapped in our silos. That’s why I believe we should never stop learning!”

OTHER OPPORTUNITIES

The White House Leadership Development (WHLD) program annually selects fellows who serve oneyear rotations on high-visibility, cross-agency projects, and take part in a development program to help aspiring senior career civil servants develop their skills and better serve the American people.

Graduate School USA, not affiliated with the government, offers leadership and management courses open to all aspiring and current federal leaders.

HOW SHOULD YOU CHOOSE A PROGRAM?

Stewart Liff is a retired member of the Senior Executive Service and the author of “Managing Government Employees” (2007) and “Managing Your Government Career”

“Most of the leadership programs the federal government offers are pretty effective. These programs broaden your horizons. If you work in one place or a couple of places for most of your career, you tend to see only a small slice of the pie and not understand the forces at play and how they operate.”

– Stewart Liff, retired Senior Executive Service member

(2009), as well as other books on leadership. He is a strong believer in the importance of training for federal managers.

“More than anything else, practical down-to-earth training that teaches you how to operate in the real world is relevant and helpful,” Liff says. “One of the biggest complaints I’ve heard from both training officers and managers is that that leadership training is often entirely theory-based. Theory-based training is nice as a foundation, but once you get back to your agency and you’re on the shop floor, the skill sets of how to operate in the real world of the federal government are absolutely crucial.”

“Most of the leadership programs the federal government offers are pretty effective,” he continues, “These programs broaden your horizons. If you work in one place or a couple of places for most of your career, you tend to see only a small slice of the pie and not understand the forces at play and how they operate.”

He believes the more you can get a broader perspective, understand how politics fit in, and understand the way people outside your organization look at things, the more you’ll be able to anticipate problems and nip them in the bud. National training opportunities such as FEI and the Presidential Management Fellows program allow you to meet new people with different sets of experiences.

“Building those types of allies, relationships and mentors are valuable in your career.”

Liff also recommends additional ways for federal employees to develop their leadership skills that do 46

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not involve formal training. “Try to find mentors in the private sector,” he suggests. “Become exposed to different ideas. Understand that the federal government is one part of the world, not the entire world.”

“Early in my career,” he continues, “I started developing mentors from outside the government, and they really opened up my eyes and my world and helped me build my skill sets. I also found that innovation comes from the intersection of several different disciplines.

The more you can be exposed to people who have different workplace challenges and different ideas, the better. That will round you out and make you even more valuable to your agency.”

Aspiring leaders, he says, should not rely on their agencies and their supervisors exclusively to facilitate their professional development. “You have a larger part of the responsibility to develop yourself,” he says. He suggests becoming an “incessant reader,” and reading management books from many different perspectives, as well as biographies and histories. “The less narrow your world becomes, the more valuable you’re going to become to your organization and to other organizations down the road.”

New and aspiring leaders should “open their eyes” wherever they are. “When you go to visit another organization, observe the organization’s mind-set, the culture, how people act, how the physical plant is designed and whether metrics are posted throughout the organization. Look at every opportunity as an opportunity to learn and grow and to see what works well or doesn’t work well.”

OPM’s Brill concludes that “many individuals already possess innate leadership qualities that can be cultivated through learning and development. To grow as leaders, individuals should assess their needs and develop a comprehensive leader development plan that integrates a range of interventions most suited to them and to a specific competency. Learning opportunities are everywhere, so don’t limit yourself to well-known courses or vendors – and take advantage of mentors and coaches.”

Leadership skills are learned in many different ways, Liff adds. “This occurs not only through formal training, which is certainly important, but also by keeping your mind, ears and eyes open, you can learn so many new things. I think it will not only make you a better leader, it will make you a better person.”

—EVERETT A. (EV) CHASEN IS A WRITER AND COMMUNICATIONS CONSULTANT IN THE WASHINGTON, DC, AREA. HE RETIRED FROM THE FEDERAL GOVERNMENT AFTER 35 YEARS OF SERVICE.

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Managing Money

QUALIFIED CHARITABLE DONATIONS AND THE TSP

T

he Tax Cuts and Jobs Act of 2017 (TCJA) has many charitably inclined taxpayers scrambling for ways to continue receiving a tax benefit from their

charitable donations. In fact, NARFE has been receiving many questions regarding how to use the Thrift Savings Plan (TSP) to make a qualified charitable donation (QCD).

As explained in the May column, a charitable contribution via a QCD is not claimed as an itemized deduction. The benefit of the QCD is not being reported as taxable income, which means that even those who take the standard deduction will receive a tax benefit from charitable contributions made via a QCD. Additionally, QCDs go toward satisfying your required minimum distribution (RMD), and considering the limit on a QCD is $100,000 per individual per year, just about everyone will be able to use a QCD to satisfy their entire RMD and annual charitable goals as well.

But here’s the rub – a QCD cannot be made directly from the TSP. QCDs are only permitted from an Individual Retirement Account (IRA). If you don’t have an IRA, you’ll have to transfer some of your TSP to an IRA account. How much depends on your objectives. For example, if you want to use a QCD to satisfy your entire RMD, your only option is to transfer the entire TSP to an IRA. However, if your RMD 48

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exceeds your annual charitable goal, or you want to make a QCD in addition to your RMD, you can use a partial withdrawal to transfer money from the TSP to a Traditional IRA while maintaining your TSP account.

QCDs are only available once you reach age 70-1/2 (not just the year in which you turn 701/2), but you’ll want to transfer money to an IRA before the year you turn 70-1/2 if you want to use your first RMD for a QCD. Let’s walk through an example to illustrate why.

Let’s assume George, a married federal retiree, turns age 70-1/2 this year and has a TSP account (his only retirement account), which had a December 31, 2017, value of $500,000. George, who will be age 70 at the end of the year, calculates his RMD to be $18,248 based on a distribution factor of 27.4. George and his wife typically donate $10,000 to charity each year, but because of the new higher standard deduction, they will not be itemizing deductions in 2018.

BY MARK A. KEEN,

CFP®

To receive a tax benefit for their charitable donation, George would like to make a $10,000 QCD in 2018. Unfortunately, while George may still transfer money to an IRA and make a QCD in 2018, he has lost the ability to have the QCD satisfy any of his 2018 RMD. The reason is that once a TSP participant reaches the year he turns age 70-1/2, the TSP is required to distribute the TSP participant’s current year RMD before transferring any money to another retirement plan, such as an IRA. For example, if George submits a partial withdrawal request to transfer $50,000 from his TSP to a Traditional IRA, the TSP will first distribute the $18,248 RMD to George, before transferring the remaining $31,752 to the IRA. George could use any or all the IRA money for a QCD in 2018, but it will have no effect on his TSP’s RMD. In other words, any QCD from the IRA in 2018 would be in addition to his TSP’s RMD. While it’s too late for George to use his 2018 RMD for a QCD, he could transfer money this year in preparation for next year’s RMD and QCD goal. For example, assuming a QCD goal of $10,000, George could multiply $10,000 by next year’s distribution factor of 26.5 to determine how much to transfer to the IRA, which in this case, is $265,000.

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To initiate the transfer, George would submit form TSP-77, “Request for Partial Withdrawal When Separated,” for a withdrawal of $283,248 ($265,000 plus $18,248 for 2018’s RMD), and direct 100 percent to be transferred to an IRA. The TSP will distribute the RMD directly to George and transfer the remaining $265,000 to the IRA. Assuming no growth on the accounts, in 2019 the IRA’s RMD will be $10,000 and the TSP’s RMD will be $8,179.

Current TSP withdrawal rules allow for only one lifetime partial withdrawal, but sometime before the end of 2019, the TSP will be rolling out the new withdrawal rules, which allow for multiple partial withdrawals. At that point, George will be able to look ahead to 2020, and if necessary, transfer additional money to his IRA account to meet 2020’s QCD goal.

For more information on RMDs, current and new TSP withdrawal rules, check out the March 2018 narfe magazine article, “Opening Up New Options: TSP Modernization Act Gives You Greater Flexibility,” p. 26-32. If you’re looking to use your TSP to fund a QCD, planning ahead is key.

MARK A. KEEN, CFP®, IS PARTNER, KEEN & POCOCK, AND AN INVESTMENT ADVISER REPRESENTATIVE AND REGISTERED PRINCIPAL OF THE STRATEGIC FINANCIAL ALLIANCE, INC. (SFA). SECURITIES AND ADVISORY SERVICES ARE OFFERED THROUGH SFA.

NARFE NATIONAL LIFE MEMBERSHIP APPLICATION National Life Membership offers a hedge against future dues increases and affirms a member’s ongoing support of NARFE’s mission to serve federal employees and retirees. National dues are paid for life; applicable chapter dues are billed annually.

CONTACT INFORMATION o Mr. o Mrs. o Miss o Ms. Full Name _____________________________________________ Street Address _________________________________________ Apt./Unit ______________________________________________ City _______________________ State _____ ZIP _____________ Phone (__________) ____________________________________ Email ________________________________________________ Date of Birth _____ /_____ /_________ dd

mm

yyyy

Recruiter ID # (if applicable) _______________________________ Chapter Number (if applicable) ____________________________ (call 800-456-8410 for chapter information) MEMBERSHIP INFORMATION Member Number: _______________________________________ (New members) Membership is open to civilians in any agency of the federal or D.C. (before Oct. 1, 1987) governments eligible for a federal annuity.

Thank you for becoming a National Member for Life. You will receive a membership card, certificate and special lapel pin.

Please allow six weeks for processing. Dues payments & gift contributions to NARFE are not deductible as charitable contributions for income tax purposes.

I am a (check all that apply)

o Active Federal Employee o Active Federal Employee Spouse

o Annuitant o Annuitant Spouse o Survivor Annuitant

Life Membership Fee Schedule Ages 30-39 40-50 51-55 56-60 61-65 66-70 71-75 76-80 81-90 91-100+

Single or Quarterly Payment Installments $1,796 $450.25 1,408 353.25 1,127 283.00 960 241.25 801 201.50 653 164.50 514 129.75 392 99.25 251 64.00 127 33.00

PAYMENT INFORMATION o Single Payment or o Quarterly Installments (4 payments) Life Membership fee amount: $ _____________________ PAYMENT OPTIONS o Check or Money Order (Payable to NARFE) o Charge my: o MasterCard o VISA o Discover o American Express Card No. _________________________________________ Expiration Date _____ /_______ mm

yyyy

Name on Card _____________________________________ Signature ________________________ Date ___________ MAIL THIS APPLICATION TO NARFE Member Records 606 N. Washington St. / Alexandria, VA 22314-1914 W W W. N A R F E . O R G

|

49

Alzheimer’s Update

RAISE FAMILY CAREGIVER ACT SIGNED INTO LAW

T

his January, the president signed into law H.R. 3759, the Recognize, Assist, Include, Support, and Engage (RAISE) Family Caregivers Act. The Alzheimer’s Association and

Alzheimer’s Impact Movement (AIM), the association’s advocacy arm, celebrated the passage of this law.

The bill was introduced by Sens. Susan Collins, R-ME, and Tammy Baldwin, D-WI, and Reps. Gregg Harper, R-MS, and Kathy Castor, D-FL. RAISE will direct the Department of Health and Human Services (HHS) to develop a national strategy to provide education and training, long-term services and financial stability for caregivers.

This will also provide some much-needed help for family caregivers to improve their health and well-being, resulting in a higher quality of care for loved ones. The development of the initial strategy will take up to 18 months, followed by biennial strategy updates.

In developing a plan, Alex Azar, Department of Health and Human Services Secretary, will consult with an advisory council, which includes family caregivers, people with disabilities and others in the field.

Advisory council meetings will be open to the public, and the plan will be updated every other year.

Azar’s plan will include recommendations for federal, state and local governments as well as community resources to 50

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support family caregivers and their needs, including respite options, financial security, workplace issues and training supports related to hospice care and palliative care.

The NARFE-Alzheimer’s program would like to thank the legislators, the Alzheimer’s Association and AIM for their lobbying efforts on behalf of more than 15 million Americans who provide unpaid care for many people living with dementia and/or Alzheimer’s.

According to the Alzheimer’s Association report, “2017 Azheimer’s Disease Facts and Figures,” family caregivers provide around 18.2 billion hours annually of unpaid care for their loved ones or friends. These caregivers are often responsible for managing medications, meals, health and financial needs among many other assigned duties on top of working full-time jobs.

Many family caregivers put their lives on hold in order to take care of the person affected by dementia and/or Alzheimer’s.

Many lack the necessary training to be a caregiver, but take on this role out of necessity.

BY OLIVIA A. WILLIAMS NARFE-ALZHEIMER’S CHAIR

When you are not the primary family caregiver, you can provide assistance by contributing monetary funds so the family caregiver can place the person they are caring for in respite care, as they get some much needed rest or

Family caregivers provide around 18.2 billion hours annually of unpaid care for their loved ones or friends. take a vacation. There are some people who just don’t feel they could make that sacrifice and are unwilling to put their lives on hold to care for and/or help their loved one. As a result, many Alzheimer’s caregivers incurred about $10.9 billion in additional health costs last year, according to the Alzheimer’s Association.

For more information on caregiving or other care for Alzheimer’s or dementia, please contact the Alzheimer’s Association at www.alz.org or the 24-hour helpline at 800-272-3900.

OLIVIA A. WILLIAMS IS CHAIR OF THE NARFEALZHEIMER’S NATIONAL COMMITTEE. EMAIL: OEASHF3@BELLSOUTH.NET THIS COLUMN APPEARS QUARTERLY.

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G FUND

F FUND

C FUND

S FUND

APRIL

0.23%

MARCH

0.24%

FEBRUARY

I FUND

-0.73%

0.38%

0.28%

2.01%

0.65%

-2.55%

0.69%

-0.76%

0.21%

-0.96%

-3.69%

-3.79%

-5.07%

YTD

0.88%

-2.17%

-0.40%

0.39%

0.90%

1 YEAR

2.43%

-0.18%

13.23%

12.20%

14.88%

3 YEAR*

2.15%

1.32%

10.60%

8.90%

5.32%

5 YEAR*

2.16%

1.84%

13.01%

11.92%

6.24%

10 YEAR*

2.36%

3.82%

9.07%

9.94%

2.73%

L INCOME

L 2020

L 2030

L 2040

L 2050

*ANNUALIZED

2018

APRIL

0.30%

0.36%

0.55%

0.62%

0.69%

MARCH

-0.08%

-0.33%

-0.78%

-0.96%

-1.11%

FEBRUARY

-0.70%

-1.34%

-2.48%

-2.98%

-3.41%

YTD

0.62%

0.50%

0.33%

0.23%

0.16%

1 YEAR

4.52%

6.47%

9.19%

10.41%

11.53%

3 YEAR*

3.59%

4.73%

6.36%

7.05%

7.63%

5 YEAR*

4.01%

6.17%

7.84%

8.74%

9.51%

10 YEAR*

3.84%

5.19%

6.19%

6.65%

N/A

*ANNUALIZED

RETURNS are net of the effect of accrued administrative expenses and investment expenses/costs. Source: TSP (For additional monthly returns, go to www.tsp.gov.)

G Fund: Government securities (specially issued to the TSP) F Fund: Government, corporate and mortgage-backed bonds C Fund: Stocks of large- and medium-size U.S. companies S Fund: Stocks of small- to medium-size U.S. companies (not included in the C Fund) I Fund: International stocks of 21 developed countries L Fund: (Lifecycle) Invested in the G, F, C, S and I Funds (The proportion of L Fund balance invested in each of the individual TSP funds depends on the L Fund chosen.)

OPM RETIREMENT CLAIMS PROCESSING STATUS

2017

’18

For the Record

STOCK PRICES RISE, OFFSET BY INTEREST RATE CONCERNS

THRIFT SAVINGS PLAN FUND RETURNS

Claims Received

Inventory Monthly FYTD (Steady State Average Processing Average Processing is 13,000) Time in Days Time in Days

MARCH 7,216 20,530 APRIL 6,581 18,932 MAY 5,548 16,140 JUNE 6,141 14,530 JULY 10,070 17,091 AUGUST 7,136 17,125 SEPTEMBER 8,810 16,828 OCTOBER 8,850 18,860 NOVEMBER 5,572 19,294 DECEMBER 5,568 14,515 JANUARY 14,590 20,467 FEBRUARY 13,290 24,225 MARCH 7,767 18,730

61 72 71 68 67 65 62 64 68 60 63 46 49

66 67 67 67 67 67 67 64 66 63 63 59 57

PLEASE NOTE that this report is new, with the addition of monthly/FYTD processing time in days, to be more in line with the OPM 60-day processing goal. l Source: OPM

52

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Stock prices improved during April as enthusiasm for better-than-expected first-quarter corporate earnings reports was balanced by concerns about future interest rate increases.

The C Fund and the S Fund achieved small gains. International markets did better and led to gains for the I Fund, although returns were somewhat tempered by the rising U.S. dollar. The F Fund experienced a loss caused by interest rate movement. All of the L Funds showed gains.

—BY SEAN MCCAFFREY, CHIEF INVESTMENT OFFICER, THRIFT SAVINGS PLAN

COUNTDOWN TO COLA

T

he Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) increased 0.20 percent in March 2018.

To calculate the 2019 cost-of-living adjustment (COLA), the indices of July, August and September 2018 will be averaged and compared with the 2017 third-quarter average of 239.668. The percentage increase determines the COLA. March’s index, 243.463, is up 1.58 percent from the base.

Benefits awarded under the Federal Employees’ Compensation Act (FECA) to individuals suffering work-related injuries or illnesses are adjusted according to each calendar year’s percentage change in the CPI-W. March’s index is 1.22 percent higher than the December 2017 base index of 240.526.

The CPI represents purchases of food and beverages, housing, apparel, transportation, medical care, recreation, education and communication, and other goods and services. Included are various government fees, such as water charges, auto registration fees, and sales and excise taxes.

MONTH

CPI-W

OCTOBER 2017

240.573

NOVEMBER DECEMBER

Monthly % Change

% Change from 239.668

-0.15

0.38

240.666

0.04

0.42

240.526

-0.06

0.36

JANUARY 2018

241.919

0.58

0.94

FEBRUARY

242.988

0.44

1.39

MARCH

243.463

0.20

1.58

APRIL MAY JUNE JULY AUGUST SEPTEMBER

Donate to NARFE Programs Support Alzheimer’s Research

YOUR CHARITABLE CONTRIBUTION IS TAX-DEDUCTIBLE TO THE FULLEST EXTENT ALLOWED BY LAW.

WRITE YOUR CHAPTER NUMBER ON CHECK; MAKE IT PAYABLE TO: NARFE-Alzheimer’s Research

Enclosed is my NARFE-Alzheimer’s contribution: $ Every cent that is contributed is used for research.

Please circle: Mr. Mrs. Miss Ms. AND MAIL TO: Name: Alzheimer’s Association Address: 225 N. Michigan Ave., 17th Floor City: State: ZIP: Chicago, IL 60601-7633 Chapter Number: Credit Card Information:

MasterCard VISA NARFE MEMBERS CONTRIBUTED FOR If you have any questions, write to:

Discover AMEX ALZHEIMER’S RESEARCH: $13 Million Fund NATIONAL COMMITTEE CHAIR Card Number: Olivia Williams, 22 Garden Springs Road Expiration Date: (mm)/ (yy) Columbia, SC 29209 *Total as of March 31, 2018 3-Digit Security Code: 100% of all contributed funds go to Name: (please print) EMAIL: oeashf3@bellsouth.net

$12,675,083* Alzheimer’s research.

Signature

Join the Silver CIrcle CLIP THIS CONTRIBUTION FORM AND MAIL TO: NARFE Silver Circle 606 N. Washington St. Alexandria, VA 22314

•For a contribution of $25 or more, you will receive a Silver Circle pin, and your name will be listed in narfe magazine with other contributors.

•For a contribution of $1,000 or more, your name will be placed on the “Wall of Fame” at NARFE Headquarters.

YOUR CHARITABLE CONTRIBUTION IS TAX-DEDUCTIBLE TO THE FULLEST EXTENT ALLOWED BY LAW.

/

Enclosed is my Silver Circle contribution: $ ID # (ID # may be found on your narfe magazine label or your NARFE membership card)

Name: Address: City: State: ZIP: Silver Circle contributions are NOT deductible for federal income tax purposes.

INSTALLMENT PLAN Wall of Fame 12-month installment plan

Give to the Scholarship and Disaster Funds

PLEASE MAIL COUPON AND CHECK TO: FEEA 1641 Prince St. Alexandria, VA 22314

/

All donations go to the NARFE General Fund to support NARFE programs and operations.

My check is enclosed

(Please make check payable to NARFE Silver Circle.)

Please charge my credit card Card type MasterCard VISA

Discover AMEX Card Number: Expiration Date: (mm)/ (yy) Name: (please print)

Signature

MAKE CHECK PAYABLE TO: NARFE-FEEA Disaster Fund or NARFE-FEEA Scholarship Fund.

Date

YES!

Date

/

I would like to help with my contribution.

Scholarships are available to children, grandchildren and great-grandchildren of federal civilian retirees and current federal employees who are NARFE members.

NARFE-FEEA Disaster Fund NARFE-FEEA Scholarship Fund

Amount: $ Amount: $

Name: Address: City: State: ZIP: To make credit card contributions, visit NARFE Scholarships at www.feea.org/givenarfeschol or NARFE Disaster Relief at www.feea.org/givenarferelief.

/

NARFE News

MAKE YOUR VOICE HEARD

NARFE WELCOMES NEW EMPLOYEES

N

ARFE announces the addition of three key staff members in the Advocacy, Communications, and Marketing and Member Resources departments. Please join us in welcoming them to our organization.

SAMUEL BARTELS

joined NARFE‘s Advocacy Department as the new advocacy assistant.

Bartels was active in political campaigns as a volunteer director and field organizer for local elections and lobbying initiatives. Prior to his experience with campaigns, he interned for Sen. Maria Cantwell, Rep. Jim McDermott and the House Natural Resources Committee as a legislative intern. He has a bachelor’s degree in American history from Stony Brook University and

a master’s in public policy from George Washington University.

He will be responsible for assisting the Advocacy Department staff, managing department phones and corresponding with NARFE members on policy issues as well as writing the NARFE Legislative Hotline.

PRECIOUS DORCHROBINSON joined

NARFE’s Communications Department as the communications assistant. She has a background in news writing for magazines and TV stations and producing digital content for the nonprofit sector. She holds a bachelor’s degree in broadcast journalism from Florida A&M University. She will be responsible for maintaining NARFE’s social media platforms, blog and responding to member questions.

Need to contact your member of Congress? NARFE members are encouraged to use the NARFE Legislative Action Center to quickly and easily send messages, tweet or call their members of Congress about NARFE issues.

NARFE’s Action Center includes a letter, phone script and tweet to use as a framework to contact your legislators.

JILL TALLEY joined

NARFE’s Marketing and Member Resources Department as the deputy director of public relations.

Previously, she worked as the public relations manager at the American Statistical Association. A public affairs professional with more than 15 years of strategic communications, PR and marketing experience in the association and nonprofit sector, Talley holds a bachelor’s degree in public communication from American University. She will be responsible for increasing brand awareness and recognition of NARFE as the go-to resource for the federal community by media, policymakers, the general public and other stakeholders.

NARFE BLOG OFFERS A FORUM FOR DISCUSSION The NARFE blog provides a dedicated, moderated online forum for members to discuss the upcoming 2018 NARFE elections, including the candidates, bylaws and resolutions and ballot questions. The blog is your opportunity to learn from other NARFE members, exchange ideas and engage in constructive dialogue about these issues - and many others.

To facilitate the discussion, NARFE has developed a step-by-step guide on how to post on the blog. The NARFE blog guide is located on the blog’s landing page navigation bar after

54

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“blog policy.” If you have questions or concerns about the NARFE blog, please contact Precious Dorch-Robinson at probinson@narfe.org or call 571-483-1270. (Note: You must be a NARFE member to post on the blog.)

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NARFE News

NARFE Redesigns Website Pages for the Public

T

he NARFE website recently debuted a fresh new look at www.narfe.org, making more information about the organization available to the public in an easilyaccessible format.

The revised homepage features a redesigned masthead with a bright, contemporary style and provides a compelling visual focus with a larger image. A redesigned horizontal navigation bar across the top of the homepage makes it easy to find content by grouping content by topic: Federal Benefits Institute, Advocacy, Membership, Events, Communications and Contact Us. On the left-hand navigation, learn more about NARFE, the federal community and how you can support and join NARFE. Learn more about NARFE, the federal community & how you can support and join NARFE. These redesigned pages were created by the NARFE Web Team, a crossdepartmental team that brought together the talents of individuals from every department who provided unique and valuable perspectives.

The team focused on the website pages available to non-members and the public, with a focus on adding more content about the federal community, the work of NARFE and the benefits of joining the association.

The website features responsive web design, an approach aimed at

56

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allowing desktop webpages to be viewed in response to the size of the screen or web browser the visitor is viewing with. This is particularly important in supporting an increasing number of visitors who access the website from smartphones and tablets.

The following is an overview of content in each website section: FEDERAL BENEFITS INSTITUTE The NARFE Federal Benefits Institute is a member-only resource designed to help members take charge of their federal benefits and guarantee a secure future. This is also where you can find the NewsWatch “Question of the Week.”

ADVOCACY NARFE’s Advocacy Department is home to the Legislative Action Center, NARFE’s easy way to send letters to members of Congress, search for legislators, report congressional meetings, and more. It also includes the Legislative Hotline and information on NARFE-PAC for members.

MEMBERSHIP NARFE members enjoy a wealth of benefits that serve their information and financial needs. Members get powerful representation and advocacy before Congress, the Office of Personnel Management (OPM) and the White House. Membership also helps you find your local chapter and gives you membership perks on travel, health services and more.

EVENTS NARFE offers events at both the national and local level that provide valuable training designed for both

NARFE offers events at both the national and local level...for both active and retired federal employees. active and retired federal employees.

These events offer a diverse look at timely issues facing the federal community with cutting-edge educational sessions, engaging keynote speakers, opportunities to connect with other federal employees and much more. Whether at the national FEDcon18 conference or regional and federation events closer to home, you’ll find valuable information and guidance to protect and maximize your federal benefits.

COMMUNICATIONS Read up on the latest news involving federal employees and retirees at News for NARFE; check out an issue of the award-winning narfe magazine; subscribe to our e-newsletter NewsWatch with the latest news on federal benefits; and find media contacts, fact sheets and other resources.

We welcome your feedback on these webpages at communications@narfe.org, and any website technical issues can be directed to it@narfe.org.

—CHRISTOPHER JOHNSON, ASSISTANT EDITOR

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NARFE’S PREMIER CONFERENCE AUGUST 26-28, 2018 • JACKSONVILLE, FLORIDA HYATT REGENCY JACKSONVILLE RIVERFRONT

TWO NEW KEYNOTE SPEAKERS ANNOUNCED: JEFF T.H. PON Director, Office of Personnel Management NARFE is pleased to announce Jeff T.H. Pon, Director of the Office of Personnel Management (OPM) has joined the exceptional line up of speakers at FEDcon18. On Monday, August 27, Pon will address attendees, recognizing the important work of federal government employees and address workforce changes proposed by the Trump administration. An advocate for transforming government to keep pace with next-generation technology and human capital demands, Pon is committed to advancing the public’s understanding of the honorable, positive work of civil servants.

JOE THEISMANN Challenge of Change Drawing from personal experience, Joe Theismann knows how to deal with the Challenge of Change. On November 18, 1985, he was on top of his game — a two-time Pro Bowl player and the most productive quarterback in the history of the Washington Redskins. Later that evening, he found himself in a hospital bed with a compound fracture to his leg, shattering both his career and his boyhood dream. At age 35, he was faced with starting over his personal life and professional career. In this stirring presentation, attendees will learn how to take a positive approach to challenges in their personal and professional lives.

NARFE Annual Business Meeting – August 29, 2018, Hyatt Regency Riverfront Jacksonville NARFE will hold the annual business meeting, open to all members, Wednesday August 29. Any members who wish to attend can extend their stay at the Hyatt under the FEDcon18 rate of $99 per night plus tax. Check www.NARFE.org/fedcon18 for updates. An agenda will be posted there closer to the event.

MAKE PLANS TODAY TO BE AT FEDcon18!

AUGUST 26-28, 2018 IN JACKSONVILLE, FL NARFE Annual Business Meeting, August 29, 2018

REGISTER

Register today at www.NARFE.org/fedcon18.

Registration by phone is also available by calling 571-483-1265.

Registration Fee: $175 | Gala Ticket: $75

CHOOSE YOUR SESSIONS

Everyone has access to the general sessions, two lunches and Florida Night. You will have the opportunity to customize your experience by choosing sessions and workshops you would like to attend.

ADD A DAY TO VISIT JACKSONVILLE

There’s so much to do and see in Jacksonville, Florida! Beyond the majestic downtown skyline, you’ll find quaint riverfront streets, live music venues and sidewalk cafes. Make plans to add a day or two your trip and make a vacation out of it! Tours organized for conference attendees are available at www.NARFE.org/fedcon18.

BOOK YOUR HOTEL ROOM

Hyatt Regency Riverfront Jacksonville 225 East Coastline Drive | Jacksonville, FL 32202 Conference rate for accommodations is $99 plus tax per night.

To make your reservation, visit www.NARFE.org/fedcon18 and click on Travel > Hotel or call 888-421-1442.

FLYING IN?

NARFE has negotiated discount rates for FEDcon18 attendees.

Delta Air Lines – Visit www.delta.com/meetings and select “Book a Trip,” then enter meeting ID NMR9W in the “Meeting Code” box. A $25 charge will apply if you book your flight by phone (800-328-1111).

United Airlines – Visit www.united.com and select “All Search Options” under “Book Travel,” then enter offer code ZEC9550455 in the “Promotions and Certificates” box. A $25 charge will apply if booking by phone (800-426-1122).

Active and Retired Federal Employees ...

Join NARFE Today!

The only organization dedicated solely to protecting and preserving the benefits of all federal workers and retirees, NARFE informs you of any developments and proposals that affect your compensation, retirement and health benefits, AND provides clear answers to your questions.

Who Should Join the National Active and Retired Federal Employees Association?

If your future security is tied to federal retirement benefits – federal retirees, current employees, spouses and individual survivors – you should join NARFE.

NARFE MEMBER BENEFITS

• • • • •

Get monthly issues of narfe magazine with news and insights for the federal community.

Access the NARFE Federal Benefits Institute for powerful resources to help you fully understand and manage your benefits.

Visit the Legislative Action Center to contact your representatives about bills affecting federal benefits.

Visit the Member Perks page for a full listing of the many time-, money- and hassle-saving benefits available only to NARFE members.

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1Q6

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____________________________________________________

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Spouse’s Full Name

_______________________________________________ Spouse’s Email

THREE EASY WAYS TO JOIN 1. Complete this application and mail with your payment to NARFE / Member Records / 606 N. Washington St. / Alexandria, VA 22314-1914

2. Join online at www.narfe.org.

3. Call 800-456-8410, Monday through Friday, 8 a.m. to 5 p.m. ET.

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Consolidated Financial Statements for the Year Ended December 31, 2017

REPORT OF THE NATIONAL SECRETARY/TREASURER

Special Section

National Active and Retired Federal Employees Association

In 2017 the Investment Committee deserves a round of applause. The investments, while remaining within NARFE’s investment policy, had a return of $888,671, increasing total investments at market to $7,602,478.

NARFE maintains a conservative approach seeking to minimize risk throughout all investments while seeking a reasonable return.

Overall NARFE increased total combined assets to $12,598,742 and total net assets (after considering total liabilities) to $8,317,244. Unrestricted net assets increased to $7,279,427 and temporarily unrestricted net assets increased to $1,037,818. Much of those increases can be attributed to our “sustainers” in our NARFE-PAC fund.

The constancy of the donations every month enables a much more efficient plan for distribution to candidates.

Our membership revenue of $6,814,600 continues to decline as our membership declines and many members switch to paying dues in two- or three-year cycles. The organization is experiencing a change in the nature of our mix of chapter and association members. While not yet consistent enough to be documented, there are indications that “optional chapter membership” has increased new memberships in 2017. Our marketing approach continues to mature with improvements in our website and communications.

Non-dues revenue generally improved. By reducing associated costs, we increased net revenue and became more profitable. Net fundraising revenue increased by more than 8 percent; our webinars have grown from experiment to success. Our library of past webinars provided access to more than 20,000 existing members and new webinars successfully attracted over 150 new members, on average, at each event. Since we expense the cost of webinars, the value of our library of past webinars is not always readily apparent. Accountants do not assign value to it because there is no way to independently measure it at present.

NARFE continues to have a stronger voice in Washington. The NARFE president, NEB, and staff continue to demonstrate leadership in serving our members.

REPORT OF THE NATIONAL EXECUTIVE BOARD AUDIT COMMITTEE

The National Executive Board (NEB) Audit Committee met electronically on March 29, 2018, with Julia Lafferty of the audit firm Councilor, Buchanan & Mitchell, P.C. (CBM), certified public accountants, first with NARFE National Officers and staff and then privately to review the audit of NARFE’s finances for the calendar year ended December 31, 2017.

The NEB Audit Committee members participating were Region VII Vice President Rodney L. Adelman (chair), Region VI Vice President Marshall Richards and Region X Vice President William Shackelford.

Lafferty provided a comprehensive review of NARFE’s Consolidated Financial Statements and Supplementary Information audit. The auditors reported finding no weakness in internal controls and have provided an unmodified opinion on our financial statements. In addition, they made the committee aware of changes that will take place in the next three years related to new U.S. government regulations and taxation, as well as changes required to be in compliance with changing generally accepted accounting principles (GAAP).

NARFE should be minimally affected by these changes.

The audit confirmed the increase in net assets at 2017 year-end in comparison to previous years. Despite the continuing decline of NARFE membership, the auditors were generally pleased that NARFE’s financial situation continues to improve. NARFE’s outstanding return on investments and the increase in sustainers’ participation in NARFE-PAC were major contributors to NARFE’s financial success.

The NEB Audit Committee accepts the report. Based on the report, the committee commends NARFE senior management and staff for their contributions to quality reporting.

Rodney L. Adelman, Chair

W W W. N A R F E . O R G | 61

Independent Auditors’ Report To the Executive Board National Active and Retired Federal Employees Association Alexandria, Virginia We have audited the accompanying consolidated financial statements of National Active and Retired Federal Employees Association which comprise the consolidated statement of financial position as of December 31, 2017, and the related consolidated statements of activities and cash flows for the year then ended, and the related notes to the consolidated financial statements.

Management’s Responsibility for the Consolidated Financial Statements Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility Our responsibility is to express an opinion on these consolidated financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors’ judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditors consider internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of National Active and Retired Federal Employees Association as of December 31, 2017, and the changes in its net assets and its cash flows for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Report on Summarized Comparative Information We have previously audited the 2016 and 2015 consolidated financial statements of the Association, and our reports dated April 3, 2017, and March 22, 2016, respectively, expressed an unmodified audit opinion on those consolidated audited financial statements. In our opinion, the summarized comparative information presented herein as of and for the years ended December 31, 2016, and 2015, is consistent, in all material respects, with the 2016 and 2015 audited financial statements from which it has been derived.

62

Councilor Buchanan & Mitchell, P.C. Certified Public Accountants Bethesda, Maryland March 29, 2018

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National Active Nand Retired Employees Association andAND Affiliate ATIONAL ACTIVEFederal AND RETIRED FEDERAL EMPLOYEES ASSOCIATION AFFILIATE Consolidated Statement ofCFinancial Position ONSOLIDATED STATEMENT OF FINANCIAL POSITION December 31, 2017 (With ComparativeDECEMBER Totals as of December 31, 2016 and 2015) 31, 2017 (WITH COMPARATIVE TOTALS AS OF DECEMBER 31, 2016 AND 2015) 2017 Unrestricted Board Designated

Operating

Total Unrestricted

Temporarily Restricted

2016 Total

2017 Total

2015 Total

Assets

NATIONAL ACTIVE AND RETIRED FEDERAL EMPLOYEES ASSOCIATION AND AF

Current Assets Cash and Cash Equivalents Accounts Receivable - Net Interorganization Receivables Prepaid Expenses and Deposits Investments

$

Total Current Assets

821,419 166,436 1,006 256,486 3,938,873

$

122,336 $ 943,755 $ 166,436 100 1,106 ONSOLIDATED 256,486 3,262,607 7,201,480

C

634,374 $ 1,578,129 $ 1,374,385 $ 14,019 180,455 187,008 - * TATEMENT OF- * INANCIAL 2,040 258,526 124,754 400,998 7,602,478 6,281,358 ECEMBER

S D

F 31, 2017

(WITH COMPARATIVE TOTALS AS 9,619,588 OF DECEMBER 31, 20167,553,781 AND 2015) 8,569,263 1,051,431 * 7,967,505 * *

5,184,220

3,385,043

Property and Equipment Land 700,000 700,000 700,000 2017 Buildings 4,520,625 4,520,625 4,520,625 Unrestricted Furniture, Equipment, and Software 1,872,326 1,872,326 1,872,326 Less Accumulated Depreciation and Board Total Amortization (4,113,796) (4,113,796) NATIONAL ACTIVE AND RETIRED FEDERAL E(4,113,796) MPLOYEES ASSOCIATION AND AFFILIATE

Operating

Net Property and Equipment Assets Total Assets

Unrestricted

$

821,419 $ 2017 166,436 Unrestricted Board 1,006Total Designated Unrestricted 256,486 3,938,873

Operating

5,184,220 $ 461,855 1,006 1,106 81,218 59,561 - 5 -2,754,250

Land Total Current Liabilities 3,237,862 Buildings Noncurrent Deferred Revenue Furniture, Equipment, and Software662,316 Less Accumulated Depreciation and Total Liabilities 3,900,178 Amortization Net Assets Unrestricted

Total Net Assets

$

368,814

4,268,992

3,016,229

7,279,426

8,163,375

3,016,229

$

$

11,156,876 * $

943,755 166,436 2017 1,106 Total 256,486 7,201,480

$

10,923,339 *

634,374 14,019 2015 Total 2,040 400,998

2016 Total

$

--

700,000 4,520,625 970,563 1,872,326

776,718

872,669 -

4,281,497 *

3,792,808 *

3,902,517 *

3,310,934 *

13,611

-

3,016,090 *

(4,113,796)

6,657,647

6,215,759

706,421

805,063

7,279,426

3,385,043

$

1,037,820

$

1,051,431

$

8,317,246

11,548,418

$ 12,598,743 * $

7,364,068

$

700 4,520 1,872

-

7,279,426

2,979,155

9,619

3,029,848 *

1,037,820

-

(4,113

-

7,020,822

1,051,431

11,156,876 * $

2,979

$ 12,598

10,923,339 *

* Interorganizational receivables and payables eliminated in consolidation.

See accompanying Notes to Consolidated Financial Statements.

-6-

* Interorganizational receivables and payables eliminated in consolidation.

See accompanying Notes to Consolidated Financial Statements.

-5W W W. N A R F E . O R G

|

1,578 180

258 7,602

-

11,548,418

2017 Total

3,369,558

1,037,820

8,163,375

3,385,043

Temporarily (3,741,769) Restricted

(3,964,778)

-

2,979,155 -

$

700,000 4,355,237 2,056,090

8,569,263 475,466 $ 492,206 1,051,431 $ 415,137 - * - * - * 81,218 103,203 117,764 2,754,250 2,420,681 2,496,947

$

13,611

(4,113,796)

-

$

-

700,000 3,298,429 4,520,625 308,247 1,872,326 970,563

4,263,197

Total Assets

3,385,043 $ 13,611

60,567

4,263,197

Net Property and Equipment

Temporarily Restricted

122,336 Temporarily 100 Restricted 3,262,607

700,000 4,516,999 1,937,150

3,189,371

$(WITH 8,163,375 $ 3,385,043 $ OF 11,548,418 $ 12,598,743 * $ COMPARATIVE TOTALS AS DECEMBER$31, 1,051,431 2016 AND 2015)

Current Liabilities Accounts Payable and Total Current Accrued Expenses $ in consolidation.

461,855 $ * Interorganizational receivablesAssets and payables eliminated Interorganization Payables 100 See accompanying Notes to Consolidated Financial Statements.

Chapter Dues Payable 81,218 Property and Equipment Deferred Revenue 2,694,689

Total Liabilities and Net Assets

Designated

2,979,155 STATEMENT- OF FINANCIAL 2,979,155 POSITION - CONTINUED 2,979,155 CONSOLIDATED DECEMBER 31, 2017

Current Assets Cash and Cash Equivalents Accounts Receivable - Net Interorganization Receivables Prepaid Expenses and Deposits Liabilities and Net Assets Investments

P

1,230,390 355,496 - * OSITION 132,473 5,835,422

63

National Active and Retired Federal Employees Association and Affiliate Consolidated Statement of Activities For the Year Ended December 31, 2017 (With Comparative Totals for the Years Ended December 31, 2016 and 2015) 2017 NATIONAL ACTIVE AND RETIRED FEDERAL EMPLOYEES ASSOCIATION AND AFFILIATE Unrestricted Board

Total

Temporarily

2016 Total

2017 Total

Operating STATEMENT Designated OF Unrestricted Restricted CASH FLOWS CONSOLIDATED FOR THE YEAR ENDED DECEMBER 31, 2016

Revenues and Support (W ITH COMPARATIVE TOTALS FOR THE$ YEARS ENDED DECEMBER 2014) Membership Dues $ 6,769,372 45,226 $ 6,814,598 $ 31, 2015- AND $ 6,814,598 $ 7,081,151 Contributions - Calendar, Note Pads, and Cards 2,674,975 2,674,975 2,674,975 2,170,576 Contributions - PAC 870,852 870,8522014 723,686 2016 2015 Contributions - Silver Circle and Other 25,935 100 26,035 29,937 55,972 150,680 Contributions - Protect America’s Cash Flows from Operating Activities Heartbeat 1,730 - $ 1,730 Increase in Net Assets 343,246 $ 294,331 $1,730 148,245 2,280 Advertising to Reconcile Increase in Net Assets 840,062 840,062 840,062 816,896 Adjustments Royalties 126,223 126,223 126,223 138,987 to Net Cash Provided by Operating Activities Seminars and Conferences 222,966 222,966 222,966 54,192 Depreciation and Amortization 385,066 534,414 469,545 National Convention Revenue 346,335 OtherNet Realized and Unrealized (Gains) Losses 28,553 28,553 28,553 80,025 on Investments (154,618) 446,287 Net Assets Released from Restrictions 487,558 84,000 571,558 (571,558) - 68,880 -

Loss on Disposal of Property and Equipment 11,177,374 (Increase) Decrease in Assets ExpensesAccounts Receivable - Net Prepaid Program ServicesExpenses and Deposits Communications 1,735,145 Increase (Decrease) in Liabilities Rebates to Federations 706,823 Accounts Payable and Accrued Expenses NewChapter Member Dues Rebates to Payable Federations Chapters 81,781 Deferred and Revenue Total Revenues and Support

11,306,700

-

Proceeds from Sale of Property and Equipment

6,242,128

922,417 293,578 640,215 64,654 1,866,172 (349,732) 58,414 541,622 29,936 (205,802)

-

6,242,128

2,971,556 143,995 1,425,053 1,230,390 932,687

Services End of Year5,278,633 CashTotal and Supporting Cash Equivalents,

50,663

5,329,296 $ 1,374,385

Supplementary Disclosure of Cash Flow Information Total Expenses 11,520,761 Cash Paid during the Year for Income Taxes

50,663

Investment Income (Losses) Increase in Net Assets Net Assets, Beginning of Year Net Assets, End of Year

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833

11,564,808

6,242,128

(513,798)

$

2,865,097 725,990 37,332 2,830 936,860 159,889 139,308 22,850 12,216,641

89,746 (30,124) 1,735,145

-

$ 7,326,485

1,727,176

-

6,589,612

1,854,883 713,541 81,272 739,418 235,490 17,448 2,130,194 81,302 343,132 23,087 6,219,767

(740,652)

2,971,556 2,747,213 175,065 1,425,053 (99,968) 1,343,953 1,055,325 1,155,293997,963 932,687

3,092,766 1,398,812 1,150,194

5,329,296 5,089,129 1,230,390 $ 1,055,325

5,641,772

-

$

11,571,424

-

$

11,678,741

11,861,539

230

(343,387)

78,663

(264,724)

329,231

64,507

(113,933)

355,102

741,400

145,103

886,503

2,168

888,671

457,179

(60,771)

398,013 3,865,184

223,766 2,792,463

621,779 6,657,647

331,399 706,421

953,178 7,364,068

343,246 7,020,822

294,331 6,726,491

$ 4,263,197

$ 3,016,229

$ 7,279,426

$ 1,037,820

$ 8,317,246

$ 7,364,068

$ 7,020,822

-8

-

11,571,424

$

2,998

922,417 627,049 293,578 640,684249,403 688,863 64,654 64,582 1,866,172 1,834,146 395,645 (728,325) -(647,163)81,191 321,993 541,622 245,000823,776 29,936(338,489)27,917 (107,466)

(496,220)

See accompanying Notes to Consolidated Financial Statements.

64

-

900

50,663 -

11,635,931

706,823 129,620686,217 (219,277) (362) (7,867) 81,781(230,359)72,510 (152,791)

(14,561) 81,781 (172,217)

-

-

(230,808) 17,069

1,735,145 706,823 77,069

Net CashServices Used in Investing Activities Supporting General Administration 2,920,893 Net Increase (Decrease) in Cash and Cash Equivalents Membership Recruitment 1,425,053 CashFundraising and Cash Equivalents, Beginning of Year932,687

Increase (Decrease) in Net Assets from Operations

329,231

168,488 7,719

Legislative Program 922,417 FederalNet Benefits 293,578 CashProgram Provided by Operating Activities Webinars 64,654 Membership Services 1,866,172 CashNational Flows from Investing Activities Convention Purchases of Investments Protect America’s Heartbeat Sales and Maturities of Investments NARFE-PAC 541,622 NARFE Alzheimer’s 29,936 Purchases of Property Fund and Equipment Total Program Services

23

129,326

2015 Total

National Active and Retired Federal Employees Association and Affiliate Consolidated Statement of Cash Flows For the Year Ended December 31, 2017 (With Comparative Totals for the Years Ended December 31, 2016 and 2015) NATIONAL ACTIVE AND RETIRED FEDERAL EMPLOYEES ASSOCIATION AND AFFILIATE 2017 2016 CONSOLIDATED STATEMENT OF CASH FLOWS Cash Flows from Operating Activities THE YEAR ENDED DECEMBER 31, 2016 FOR Increase Net Assets $ 31, 953,178 $ 343,246 (WinITH COMPARATIVE TOTALS FOR THE YEARS ENDED DECEMBER 2015 AND 2014) Adjustments to Reconcile Increase in Net Assets to Net Cash Provided by Operating Activities 2016 2015 2014 Depreciation and Amortization 215,927 385,066 Netfrom Realized and Activities Unrealized (Gains) Losses Cash Flows Operating onNet Investments (503,669) Increase in Assets $ 343,246 $ 294,331 $ (154,618) 148,245 Adjustments to Reconcile in Net and Assets Loss on DisposalIncrease of Property Equipment 12,432 23 to Net Cash Provided

by Operating Activities (Increase) Decrease in Assets Depreciation andReceivable Amortization 385,066 534,414 469,545 Accounts - Net 6,553 168,488 Net Realized Unrealized Losses Prepaidand Expenses and(Gains) Deposits (133,772) 7,719 on Investments (154,618) 446,287 68,880 Increase (Decrease) in Liabilities Loss on Disposal of Property and Equipment 23 2,998 Accounts Payable and Accrued Expenses (16,740) 77,069 (Increase) Decrease in Assets Chapter Dues Payable (21,985) (14,561) Accounts Receivable - Net 168,488 (230,808) 89,746 Deferred Revenue 527,414 (172,217) Prepaid Expenses and Deposits 7,719 17,069 (30,124) Increase (Decrease) in Liabilities Net Payable Cash Provided

by Expenses Operating Activities Accounts and Accrued Chapter Dues Payable Deferredfrom Revenue Cash Flows Investing Activities

77,069 (14,561) (172,217)

Purchases of Investments Net Cash Provided by Operating Activities Sales and Maturities of Investments ofInvesting PropertyActivities and Equipment CashPurchases Flows from Proceeds Sale of Property and Equipment Purchases of from Investments

(362) (152,791)

(7,867) (230,359)

(2,621,641) 688,863 1,804,190 (19,691) 1,548 (349,732) (728,325)

(349,732) 640,684 58,414 (205,802) 900 (647,163)

640,215

58,414 (205,802) 900

(107,466) (835,594)

Net Increase in Cash and Cash Equivalents Net Cash Used in Investing Activities Cash and Cash Equivalents, Beginning of Year

(496,220)

203,744 (513,798) 1,374,385

Net Increase (Decrease) in Cash and Cash Equivalents and Equivalents, Cash Equivalents, of Year CashCash and Cash Beginning End of Year

143,995 1,230,390$

Cash and Cash Equivalents, End of Year

$ 1,374,385

Cash Paid during the Year for Income Taxes

$

Supplementary Disclosure of Cash Flow Information Cash Paid Disclosure during theofYear Income Taxes Supplementary Cashfor Flow Information

321,993

(99,968)

1,374,385 1,155,293 $

$ -

(219,277) (362) (152,791) 688,863

(728,325) 321,993 (107,466) (513,798)

143,995 (740,652) 1,230,390

1,230,390

242

(230,808) 17,069

-

175,065

$

446,287 -

245,000

1,578,129 1,055,325 $

$ 833

294,331

534,414

(338,489) (496,220)

-

$

$

640,215 129,620

1,039,338 (219,277)

Sales and Maturities of Investments Purchases of Property EquipmentActivities Net Cash Used and in Investing Proceeds from Sale of Property and Equipment

2015

$

1,230,390

$

-

1,055,325

833 $

175,065 1,055,325

230

See accompanying Notes to Consolidated Financial Statements.

-8W W W. N A R F E . O R G

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65

National Active and Retired Federal Employees Association and Affiliate Notes to Consolidated Financial Statements December 31, 2017 1. ORGANIZATION

National Active and Retired Federal Employees Association (the Association) was established to advance the general welfare of its members and to aid them in securing their rights under federal retirement laws. Fifty-four (54) federations, located in the United States, Panama, Puerto Rico, and the Philippines, are affiliated with the Association and conduct local independent programs. Ten percent of all eligible member national dues collected are rebated to these federations to facilitate local association activities. In addition, there are 1,067 chapters affiliated with the Association that are located in the United States and some international locations. The chapters are established by members to increase the scope and effectiveness of the Association. Chapter dues, which are not reported as revenues and expenses of the Association in the accompanying consolidated statement of activities, are established by the chapters and are billed and collected by the Association with the national dues. However, the Association rebates to the chapters one-third of the national fee charged for all new members joining chapters.

The consolidated financial statements include the assets, liabilities, net assets, activities, and cash flows of the Association and its political action committee (NARFE-PAC or Affiliate), which was authorized by the executive board of the Association.

All significant interorganization balances and transactions were eliminated in consolidation. The financial information of the 54 federations and the 1,067 chapters is not included in the Association and Affiliate’s consolidated financial statements.

66

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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting The consolidated financial statements have been prepared on the accrual basis of accounting.

Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Cash and Cash Equivalents Cash and cash equivalents consist of cash deposits in checking accounts, certificates of deposit with original maturities of less than 90 days, money market accounts, and overnight investment accounts.

Investments Investments in debt and equity securities are stated at fair value as determined from published sources.

Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable consist primarily of amounts due to the Association for advertising in the narfe magazine and royalties.

Accounts receivable are reported at their outstanding balances.

The Association provides an allowance for doubtful accounts, as needed, for accounts deemed uncollectible. The allowance for doubtful accounts as of December 31, 2017, was $2,000.

Management periodically evaluates the adequacy of the

allowance for doubtful accounts by considering the Association’s past receivables loss experience, known and inherent risks in the accounts receivable population, adverse situations that may affect an obligor’s ability to pay, and current economic conditions.

The allowance for doubtful accounts is increased by charges to bad debts expense and decreased by charge offs of the accounts receivable balances.

Accounts receivable are considered past due when no payments have been received for 30 days.

Accounts receivable are charged off based on management’s caseby-case determination that they are uncollectible.

Property and Equipment Property and equipment are stated at cost and are depreciated and amortized on the straight-line method over the useful lives of the assets, ranging from 3 to 40 years. The Association capitalizes items of property and equipment costing $1,500 or more. Depreciation and amortization expense for the year ended December 31, 2017, was $215,927.

Net Assets The Association and Affiliate classify net assets into two categories, unrestricted and temporarily restricted. All contributions are considered to be available for unrestricted use unless specifically restricted by the donors. Temporarily restricted net assets are contributed with donor-imposed purpose or time restrictions and are to be used for the restricted purposes or time periods as requested by the donors. The Association and Affiliate had no permanently restricted net assets at December 31, 2017.

Included in unrestricted net assets as of December 31, 2017, is $2,000,000 that is designated

by the Association’s executive board to pay operating expenses should the Association’s operations be disrupted by an unforeseen event. Also included in board-designated net assets are $896,585 for the life membership fund and $119,644 for the building fund.

Membership Dues Annual membership dues are deferred when received and are recognized as revenue over the periods covered by the memberships.

Life membership dues are recognized as revenue over the duration of the life membership based on the collective average life expectancy for life members, according to the “United States Life Tables,” 2007, published in the National Vital Statistics Report, Volume 63, No. 7, published on November 6, 2014.

Contributions The Association and Affiliate report contributions as support when they are received. The Association and Affiliate report contributions as temporarily restricted support if restricted for use for specific programs or time periods. When donor restrictions expire, that is, when purpose or time restrictions are accomplished, temporarily restricted net assets are reclassified to unrestricted net assets and are reported in the consolidated statement of activities as net assets released from restrictions.

Royalties Royalties are earned by the Association for granting the use of its name to third parties that market services to Association members.

Revenues from these activities are recorded when earned.

Rebates to Federations and Chapter Dues and Rebates Rebates to federations and chapter dues payable for renewing members are disbursed to federations and chapters after their receipt in the Association’s headquarters. Rebates due to the

federations on life members are deferred for the duration of the life membership and disbursed to federations monthly, when earned. New member rebates disbursed to federations and chapters were approximately $49,700 and $32,100, respectively.

Income Taxes The Association is exempt from federal income taxes under Section 501(c)(5) of the Internal Revenue Code and applicable state law.

The accounting standard on accounting for uncertainty in income taxes addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the consolidated financial statements.

Under that guidance, the Association may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities based on the technical merits of the position. Examples of tax positions include the tax-exempt status of the Association and various positions related to the potential sources of unrelated business income tax (UBIT).

The tax benefits recognized in the consolidated financial statements from such a position are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement.

There were no unrecognized tax benefits identified or recorded as liabilities for 2017.

The Association’s policy would be to recognize interest and penalties, if any, on tax positions related to its unrecognized tax benefits in income tax expense in the consolidated financial statements. No interest and penalties were assessed or recorded during 2017.

The Association’s Form 990, Return of Organization Exempt from Income Tax, is subject

to examination by the taxing authorities, generally for three years after it was filed.

NARFE-PAC is generally exempt from federal income tax under Section 527 of the Internal Revenue Code. However, interest revenue earned on NARFE-PAC investments is subject to federal and state income taxes. The taxes on that interest for the year ended December 31, 2017, were not significant.

NARFE-PAC’s tax return filed with the IRS is subject to examination by the taxing authorities, generally for three years after it was filed.

Prior Years’ Comparative Totals The consolidated financial statements include certain prior years’ summarized comparative information in total but not by net asset class. Such information does not include sufficient detail to constitute a presentation in conformity with accounting principles generally accepted in the United States of America.

Accordingly, such information should be read in conjunction with the Association and Affiliate’s consolidated financial statements for the years ended December 31, 2016 and 2015, from which the summarized information was derived.

Reclassifications Certain 2016 amounts have been reclassified to conform to the 2017 presentation. Such reclassifications had no effect on reported changes in net assets.

3. CONCENTRATION OF CREDIT RISK

For purposes of Federal Deposit Insurance Corporation (FDIC) coverage, cash accounts are maintained in several different banks. As of December 31, 2017, bank deposits exceeded the $250,000 FDIC-insured limit by approximately $686,500.

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6. RETIREMENT PLAN The Association has a RetireAs of December 31, 2017, the Association and Affiliate’s only assets or ment Savings Plan (the Plan). liabilities measured at fair value on a recurring basis consisted of the folEmployees are eligible to particilowing investments: pate in the Plan on the first day of the month coinciding with or Level 1 Level 2 Level 3 next following the employee’s Fair Value Inputs Inputs Inputs hire date. Employees become eligible for employer matching Corporate Stocks and Equity Mutual Funds $ 3,740,089 $ 3,740,089 $ - $ funds on the first day of the Plan Corporate Bonds 3,623,704 3,623,704 Government Backed Securities 222,533 222,533 Year (January 1) or the first day Certificates of Deposit 16,152 16,152 of the seventh month of the Plan Year (July 1) coinciding with or Total Investments $ 7,602,478 $ 7,602,478 $ - $ next following the hire date. The E AND RN ETIRED FEDERAL EMPLOYEES ASSOCIATION AFFILIATE ATIONAL ACTIVE AND RETIRED FEDERAL EAND MPLOYEES ASSOCIATIONAssociation AND AFFILIATE matches 60 percent of N ATIONAL A CTIVE AND R ETIRED F EDERAL E MPLOYEES A SSOCIATION AND AFFILIATE E AND RETIRED FEDERAL EMPLOYEES ASSOCIATION AND AFFILIATE each employee’s voluntary contriONAL ACTIVE AND RETIRED EDERAL EMPLOYEES ASSOCIATION AND AFFILIATEAND AFFILIATE NATIONAL ACTIVEFAND RETIRED FSEDERAL EMPLOYEES ASSOCIATION OTES TO CONSOLIDATED FOTES INANCIAL TATEMENTS N TO CONSOLIDATED FINANCIAL STATEMENTS bution (up to 6 percent of annual N assets valued using Level 1Dinputs are based on unadjusted ECEMBER 2017 D ECEMBER 2017 OTES TO C ONSOLIDATED F31, INANCIAL STATEMENTS compensation). Total contribuNF31, CFinancial ONSOLIDATED INANCIAL STATEMENTS NOTES TO N OTES TO CONSOLIDATED INANCIAL STATEMENTS TO CF ONSOLIDATED FINANCIAL STATEMENTS NOTES quoted market prices within active markets. tions made by the Association 31, 2017 DECEMBER 31, 2017 DECEMBER 31, D 2017 DECEMBER ECEMBER 2017 Financial assets valued using Level 2 inputs31, are based primarily on were $158,787 for the year ended prices forAND similar assets in active or )inactive markets.

December 31, 2017.

ND F4.

AIR VIquoted ALUE M EASUREMENTS (C NVESTMENTS FAIR VONTINUED ALUE MEASUREMENTS (CONTINUED) Financial assets valued using Level 3 inputs, if any, are valued using unSTMENTS AND F AIR VALUE M EASUREMENTS (C ONTINUED ) NVESTMENTS AND F AIR V ALUE M EASUREMENTS (C ONTINUED ) 4.

I NVESTMENTS AND F AIR V ALUE M EASUREMENTS (C ONTINUED ) 4.

I ND FAIR VALUE MEASUREMENTS (CONTINUED) 7. SUBSEQUENT EVENTS observable to measure fair to3the extent observable inputs alued using Level 3inputs inputs, if any, are value valued using unobservable inputs to Financial assets valued using Level inputs, ifthat any, are valued using unobservable inputs to ncial assetsFinancial valued using Level 3 inputs, if any, are valued using unobservable inputs to The Association and Affiliate assets valued using Level 3 inputs, if any, are valued using unobservable inputs to are not available, thereby allowing for situations in which there is little, if Financial assets valued using Level 3observable inputs, ifthereby any, are valued using unobservable inputsfor to eure tofair theusing extent that observable inputs are not available, allowing for measure fair value to the extent that inputs are not available, thereby allowing alued Level 3 inputs, if any, are valued using unobservable inputs to value thefair extent that observable inputs are not available, allowing for have evaluated subsequent events measure value tofor thethe extent observable inputs arethereby not available, thereby allowing for any,tomarket activity assetthat or liability at the measurement date.

The measure fair value to the extent that observable inputs are not available, thereby allowing for ch there is little, if any, market activity for the asset or liability at the situations in which there is little, if any, market activity for the asset or liability at the eions to the extent thatmeasurement inputs are not available, thereby allowing through March 29, 2018, the date in which there little, ifthere any, activity for the asset orforliability at for the situations inisobservable which ismarket little, any, market the the asset or liability at the fair value objective is ifto determine anactivity exit price from situations in which there is little, if any, market activity for the asset or liability at the the finane. fair value measurement objective is to determine an exit price from the measurement date.

The fair value measurement objective is to determine an exit price from on which the consolidated chThe there is little, if any, market activity for the asset or liability at urement date.

The fair value measurement objective is to determine an exit price from the measurement The fair value measurement objective is owes to determine an exit price from the perspective ofdate. a market participant that holds the asset or the liability. cial statements were available to a perspective market participant that holds the asset or owes the liability. measurement date.

The fair value measurement objective is to determine an exit price from the market participant that holds the asset or owes the liability. perspective of a market participant that holds the asset or owes the liability. e.ective Theof fair value measurement objective is to determine an exit price from the Investment the year that ended December of of aincome marketfor participant holds the asset31, or2017, owesconsisted the liability. d. be issue the following: perspective a market participant holds the asset or owes the liability. market participant that of holds the asset or owesthat the liability. tment income forended the year ended 31, ended 2017, consisted of the following: Investment income forDecember the31, year ended December 2017, consisted of the following: me for the year December consisted of31,the following: Investment income for the2017, year December 31, 2017, consisted of the following: 4. INVESTMENTS AND FAIR VALUE MEASUREMENTS

Investment income for31, the2017, year consisted ended Temporarily December 31, 2017, consisted of theAdditional following: NARFE Temporarily me for the year ended December ofTemporarily the following: Temporarily Unrestricted Restricted Total Financial Data Unrestricted Restricted Total Unrestricted

Restricted Unrestricted Total Temporarily

Restricted Temporarily

Total

The salaries of the ends and Interest $ 383,131 Restricted $$ 1,871 $$ Total 385,002 Dividends and Interest 383,131 1,871 Restricted $ 385,002 Unrestricted Total Unrestricted National Board, as Realized and Unrealized Gains 503,372 297 503,669 est $ 383,131 $ 1,871 $ 385,002 Dividends and Interest $ 383,131 $ 1,871 385,002 Net Realized and Unrealized Gains 503,372 297 503,669 $Executive

of December 31, 2017, nrealized Gains 503,372 297$ 503,669$ Net Realized and Unrealized Gains 503,372 297 503,669 and Interest 383,131 1,871 $ 385,002 rest $ 383,131 $ al InvestmentDividends Income $ 886,503 $$ 1,871 2,168 $ $$ 385,002 888,671 Total Investment Income 886,503 2,168 $ 888,671 are as follows: Net Realized and Unrealized Gains 503,372 297 503,669 nrealized Gains 503,372 297 503,669 Income Total Investment Income $ 886,503 $ 2,168$ $886,503 888,671$ 2,168 $ 888,671 President: $117,312 PORARILY R ESTRICTED N ET A SSETS EMPORARILY RESTRICTED NET ASSETS 5.

T Total Investment RESTRICTED Income Income 5. TEMPORARILY 2,168 $ 888,671 NET ASSETS $ 886,503 $ 2,168$ $886,503 888,671$ Secretary/Treasurer: ESTRICTED NET SSETS 5. restricted TEMPORARILY ESTRICTED ET ASSETS porarily netA assets areR available for the following purposes as of December 2017: Temporarily restricted net assets areN available for the following purposes31, as of December 31, 2017:

Temporarily restricted net assets are available for the following pur-

$105,040

5.

TEMPORARILY ESTRICTED NET ASSETS RESTRICTED NET ASSETS FE-PAC poses as of December 31, 2017:

$ 31, 1,000,770 NARFE-PAC $ of 1,000,770 Regional Vice cted net assets are available for the following of the December 2017: as Temporarily restricted net assets arepurposes availableasfor following purposes December 31,Presidents: 2017: FE Alzheimer’s FundAlzheimer’s Fund 37,050 NARFE 37,050 $26,048

Temporarily restricted assets are available the following 31, 2017: cted net assets are available for thenet following purposes asfor of December 31,purposes 2017: as of December $ 1,000,770 NARFE-PAC $ 1,000,770

al TemporarilyTotal Restricted Net Assets Temporarily Restricted Net Assets

$

1,037,820

$

1,037,820

In 2017, NARFE’s investr’s Fund NARFE 37,050 Alzheimer’s Fund 37,050 NARFE-PAC $ 1,000,770 $ 1,000,770 ments were held with these assets were Net released from restrictions by incurring expenses or otherwise satisfying NARFE Alzheimer’s Fund 37,050 assets weredonor released from donor by incurring expenses or otherwise firms: satisfying$ 1,037,820 r’s Fund 37,050 y Restricted Net Assets $ 1,037,820 Total Temporarily Restricted Net restrictions Assets estricted purposes for thepurposes year ended 31, 2017, as follows: the restricted forDecember the year ended December 31, 2017, as follows: Total Temporarily Restricted Net Assets $ 1,037,820 y Restricted Net Assets $ 1,037,820 • Operating Fund: FE-PAC from $ satisfying 541,622 eleased donor byfrom incurring expenses orbyotherwise NARFE-PAC 541,622 Net assets were released from donor restrictions by incurring expenses$ orMorgan otherwise satisfying Stanley and Net assetsrestrictions were released donor restrictions incurring expenses FE Alzheimer’s FundAlzheimer’s Fund 29,936 NARFE 29,936 Vanguardsatisfying Group Net assets were released from donor restrictions by 31, incurring expenses otherwise poses forfrom the year ended December 31, as follows: the restricted purposes forrestricted the2017, year ended December 2017, as follows:orThe eleased donor restrictions by incurring expenses otherwise satisfying or otherwise satisfying the purposes foror the year ended Decemal Net for Assets Released from ber 31, 2017, asRestrictions follows: Total Net Assets Released from Restrictions the restricted purposes for31, the year as ended December 31, 2017, as follows: • Life Membership poses the year ended December 2017, follows: $ $ 541,622 NARFE-PAC $ 541,622 Trust Due to Satisfaction of Program Restrictions 571,558 Due to Satisfaction of Program Restrictions $ Fund: 571,558Morgan Stanley r’s Fund NARFE 29,936 Alzheimer’s Fund 29,936 NARFE-PAC $ 541,622 $ 541,622 • Contingency29,936 Fund: REMENT LAN 6. Pfrom RNARFE ETIREMENT PLAN Released Alzheimer’s Fund from Restrictions r’s Fund 29,936 Released Restrictions Total Net Assets Morgan Stanley tion of Program Restrictions $are Employees 571,558 to are eligible to$ Due to Satisfaction Program Restrictions 571,558 Association a Net Retirement Savings PlanRestrictions (the Plan).

Employees eligible Total Assets from Released from Restrictions Thehas Association hasReleased a ofRetirement Savings Plan (the Plan).

• PAC Fund: cipate in the Plan on the first day of the month coinciding with or next following the Due toinSatisfaction Program Restrictions 571,558 tion of Program Restrictions $ with 571,558 participate the Plan onofthe first day of the month coinciding or next following the$ James Raymond oyee’s date.

Employees eligible become for employer matching funds matching on the firstfunds day on the first day AN 6. hire employee’s R ETIREMENT Pbecome LAN hire date.

Employees eligible for employer e Plan or Pthe first day of the first seventh the Plan Yearof(July 1) Year (July 1) the Plan 1) Year (January 1) or day month of the of seventh month the Plan 6. Yearof R(January ETIREMENT LAN AN has with a Retirement Savings Plan (the Plan).

Employees are eligible to The Association has a Retirement Savings Plan (the Plan). are eligible to iding or next following the hire date.

The Association matches 60 percent of each coinciding with or next following the hire date. The Association matches 60Employees percent of each oyee’s voluntary contribution (up to 6 percent of annual compensation).

Total The Association has aonRetirement Plan (the Plan).

Employees are eligible the to Plan the first day of month coinciding with or month next following the participate in thethe Plan the first the coinciding or next following has aonRetirement Savings Plan (the Plan).

Employees eligible towith employee’s voluntary contribution (up day toSavings 6of percent ofare annual compensation).

Total ibutions made byfirst the Association were $158,787 for the year ended December 31, 2017. contributions made by the Association were $158,787 for the year ended December 31, 2017. participate in the Plan on the first day of the month coinciding with or next following the ate. become eligible for employer matching funds on the first day employee’s hire date.

Employees become eligible for employer matching funds on the first day PlanEmployees on the day of the month coinciding with or next following the 68 | J U N 2 0 1 8

employee’s hire date.

Employees become eligible foron employer matching funds the first (January 1) the or the first day of the month of the Year (July 1) of the of Plan Year (January 1) or the first day of Plan the seventh month PlanonYear (Julyday 1) ate.

Employees become eligible for seventh employer matching funds the first day

EQUENT 7. EVENTS SUBSEQUENT EVENTS

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– Chuck Clemons Four gentle massaging jets focus on the neck, back, hips, knees and may help ease the pain and discomfort of: • Arthritis • Neuropathy • Circulation Issues • Sciatica • Aches and pains • Inflammation

As we age, the occasional aches and pains of everyday life become less and less occasional. Most of us are bothered by sore muscles, creaky joints and general fatigue as we go through the day– and it’s made worse by everything from exertion and stress to arthritis and a number of other ailments. Sure, there are pills and creams that claim to provide comfort, but there is only one 100% natural way to feel better… hydrotherapy. Now, there’s a better way. It’s called the Designed For Seniors® Shower, and it can truly change your life.

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Member Perks

SAVE MONEY WITH NARFE PERKS NARFE appreciates your service, and so do businesses across the country.

Whether you are planning your next vacation or planning for retirement, members can save money on everyday purchases, thanks to our Affinity Partners.

It’s just one more way we’re able to say “thank you” for being a NARFE member.

INSURANCE

NARFE Insurance Services 800-233-5764 www.narfeinsurance.com Designed exclusively for NARFE members, plans administered by Mercer Health & Benefits Administration LLC: Group Term Life Insurance, Senior Age Whole Life Insurance, Senior Term Life Insurance, Group Hospital Income Insurance, Hospital Income and ShortTerm Recovery Insurance, and Pet Insurance.

NEW FEDERAL EMPLOYEE PROGRAM ADMINISTRATOR

Starr Wright 800-424-9801 StarrWrightUSA.fepla.com/ NARFE PROTECT YOURSELF and YOUR CAREER ... Introducing Special Federal EMPLOYEES and CONTRACTORS Professional Liability Insurance with a NARFE DISCOUNT. Starr Wright USA is offering up to $2,000,000 of coverage including LEOSA coverage. Congress has legislated up to 50% reimbursement from Agencies for qualified EMPLOYEES and we even offer CONTRACTORS coverage too! Visit https:// secure.fepla.com for more information.

MOVING SERVICES

Bekins Van Lines 800-456-6832 narfe@bekins.com All NARFE members will receive contracted pricing for all interstate shipments. This will apply to packing, 70

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transportation and full-value coverage against damages. Please mention you are a NARFE member.

MiniMoves 800-300-6683 MiniMoves is America’s only national mover exclusively focused on small shipments; a piece, a room or a full condo. There’s no minimum weight charge. Our binding quote helps you plan your move with confidence. Member discount - $25 off 500 pounds; $50 off larger moves. Use code 1292.

Wheaton World Wide Moving 800-248-7960 narfe@wvlcorp.com At Wheaton, we know interstate relocating is much more than trucks and boxes. Moving is not simply an address change. It’s a life change. With a network of top-quality agents throughout the United States, Wheaton provides peace of mind with every relocation.

We offer you, as a NARFE member, benefits to help you have a positive interstate relocation experience. Call today and mention you are a NARFE member to start the moving process.

PRODUCTS NEW

Office Depot and OfficeMax 855-337-6811, extension 2897 www.officediscounts.org/ narfe Office Depot and OfficeMax are one company! NARFE Members can save up to 80% on over 93,000 products.

Great for your printing, cleaning and of-

fice needs. Shop online or in any Office Depot or OfficeMax store. Enjoy FREE next-day delivery on online orders over $50! Visit www.officediscounts. org/narfe to shop online or print off a FREE Store Purchasing Card or call 855.337.6811 x 2897 to place your order over the phone.

Purchasing Power 866-670-3479 purchasingpower.com/NARFE With Purchasing Power, thousands of brand-name products are within reach.

As members of NARFE, you can buy today and pay over time through payroll or annuity allotment. Choose from the latest computers, appliances, vacation packages and more. Never worry about hidden fees, credit checks or interest.

Pay over 6 or 12 months, and you’re done. Save 5% with code NARFEVIP.

TELECOMMUNICATIONS

Verizon FiOS www.narfe.org/memberperks NARFE members can save up to $10 a month on a new qualifying Triple Play bundle with Verizon Fios Internet, TV and home phone service – savings of up to $120 per year. This exclusive onlineonly savings is only available to new Verizon customers or those upgrading to the Triple Play Package.

TRAVEL

Alamo 800-462-5266 www.alamo.com Drive Happy® with Alamo® where

NARFE members receive year-round discounts. Call or visit our website today and reference Contract ID 262544.

Avis Car Rental 800-633-3469 www.avis.com Avis Car Rental is one of the world’s best-known car rental brands with approximately 5,500 locations in more than 165 countries. Avis has a long history of innovation in the car rental industry and is one of the world’s top brands for customer loyalty. Call or book your reservation now at Avis.com using the NARFE AWD number A701900.

Budget Car Rental 800-218-7992 www.budget.com Budget Car rental was founded in 1958 for the “budget-minded” renter. Today, with approximately 3,500 locations around the world, Budget is a leading rental car supplier now offering discounts to members of NARFE. Call or book your reservation now at Budget. com using the NARFE BCD number D871500.

Choice Hotels International 800-258-2847 www.choicehotels.com With 6,400 hotels in the United States and throughout the world, Choice Hotels® offers something for everyone. As a NARFE member, receive 20% off your next stay at participating hotels when you use Special Rate ID 00801967. This offer is subject to availability and cannot be combined with any other offer.

Advance reservations required through phone number or website above; cannot be redeemed at individual hotels.

Choice Hotels brands are: Comfort Inn, Comfort Suites, Sleep Inn, MainStay Suites and more.

WELLNESS

National 800-CAR-RENT www.nationalcarrental.com You Drive A Hard Bargain. Receive up to 20% off rentals at National Car Rental. To make a reservation, call National Car Rental at 1-800-CARRENT® and reference Contract ID 5282909. For complete terms and conditions, visit www.narfe.org/ memberperks.

Wyndham Hotel Group 877-670-7088 NARFE members receive up to 20% off the “Best Available Rate” at participating locations. Call and give the agent your special discount ID number, 8000002694, at time of booking to receive discount. Call to reserve your room today at one of these fine hotels: Wyndham Hotels and Resorts, Days Inn, Ramada Inn, Microtel Inns and Suites and more. Advance reservations required through phone number above; cannot be redeemed at individual hotels.

Wyndham Extra Holidays 800-428-1932 www.extraholidays.com Excellent service and the finest comforts are standards you can always rely on with Wyndham Extra Holidays. With more spacious floor plans than a regular hotel, you can enjoy a One-, Two- or Three-Bedroom suite with separate living areas and partial or fully equipped kitchens. Please use promo code 8000002694 when calling or booking online.

HearUSA www.hearusa.com/narfe HearUSA: The Nation’s Most Trusted Name in Hearing Care. Choose from 250+ hearing aids with $0 Co-Pay for Many Plans. Wireless. Bluetooth. Smartphone Compatible. Nearly Invisible.

Risk-Free 60-Day Trial. Free Follow-Up Care. Free 3-Year Warranty. Call 1-855845-2706 to see if you qualify for 2 FREE hearing aids.

Life Line Screening 800-324-9906 www.lifelinescreening.com/ NARFE Life Line Screening, America’s leading provider of community-based preventive health screenings, will conduct health screenings using state-ofthe-art ultrasound technology in your neighborhood. To schedule an appointment, please call the number above and give the operator code number BKHN075 or visit the website.

Sunrise Senior Living www.SunriseSeniorLiving.com Sunrise Senior Living, a leading provider of high-quality, individualized, senior living services, offers NARFE members a special, discounted rate. Mention code: NARFE-discount during your visit and receive a one-time 5% off of suite/room rates at any of Sunrise’s U.S. communities for one year. For a complete list of Sunrise locations, visit www.SunriseSeniorLiving.com. For a complete list of any restrictions, visit www.narfe.org/ memberperks. For new move-ins only.

NARFE Member Perks are designed to provide NARFE members with a quality option in their search for commonly used products and services. NARFE makes no guarantee on any products and services listed and encourages its members to shop and compare before making a decision on any financial matter.

Check out these additional Member Perks on the NARFE website for more details!

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The Way We Worked

PUBLIC HEALTH MONITORING In this photo from 1920, Public Health Service Dr. Ella Eulows (right) and laboratory assistant Sadie Carlin (left), are testing antipneumoccus serum for potency.

The serum is obtained from animals injected with various strains of Streptococcus pneumoniae, once used to treat pneumonia. The Public Health Service mission is to protect, promote, and advance the health and safety of the United States. This mission is achieved through rapid and effective response to public health needs, leadership and excellence in public health practices, and advancement of public health science. Today, the National Institutes of Health (NIH) has taken over many of the Public Health Service’s responsibilities.

PHOTO from the Records of the Public Health Service, National Archives, courtesy of the National Archives History Office; in collaboration with the Society for History in the Federal Government (SHFG), bringing together government professionals, academics, consultants, students and citizens interested in understanding federal history work and the historical development of the federal government. To join, visit http://shfg.org.

72

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DID YOU KNOW? The Public Health Service was founded in 1798 as the primary division of the U.S. Department of Health, Education and Welfare. They monitored the commercial production of serums, vaccines and similar products so physicians and patients were assured products that were safe for consumption.

The agency’s main areas of focus with regard to public health was research, disease prevention and education.

For more information, visit www.usphs.gov.

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Best of all, it weighs only 42 pounds and folds and unfolds with ease so you can take it almost anywhere, providing you with independence and freedom.

Years of work by innovative engineers have resulted in a mobility device that’s truly unique.

They created a battery that provides powerful energy at a fraction of the weight of most batteries. The Zinger features two steering levers, one on either side of the seat. The user pushes both levers down to go forward, pulls them both up to brake, and pushes one while pulling the other to turn to either side. This enables great mobility, the ability to turn on a dime and to pull right up to tables or desks. Best of all, no one has to push you around. The controls are right on the steering arm so it’s simple to operate, and its exclusive footrest swings out of the way when you stand up or sit down. With its rugged yet lightweight aluminum frame, the Zinger is sturdy and durable yet lightweight and comfortable!

What’s more, it easily folds up for storage in a car seat or trunk– you can even gate-check it at the airport like a stroller. Think about it, you can take your Zinger almost anywhere, so you don’t

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Expedites replacement of items lost in transit.

Add $2.95 to protect your entire order.

D Widths: 7 71⁄2 8 81⁄2 9 91⁄2 10 1 10 ⁄2 11 12 13 *EEE Widths ($5 more per pair): 8 81⁄2 9 91⁄2 10 101⁄2 11 12 13

When you pay by check, you authorize us to use information from your check to clear it electronically. Funds may be withdrawn from your account as soon as the same day we receive your payment, and you will not receive your check back from your financial institution.

Satisfaction Guaranteed or Full Refund of merchandise purchase price up to 90 days after receipt.

For Faster Service Call: 1-800-543-4810 or visit www.Haband.com