August 2021 NARFE Magazine by NARFE

A NARFE PUBLICATION FOR FEDERAL EMPLOYEES AND RETIREES

August 2021 VOLUME 97 ★ NUMBER 6

P. 24

Savvy Advocacy

P. 32

The High-Stakes 2020 Census

P. 51

NARFE Financial Statements

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Contents AUGUST 2021

COVER STORY PAGE 24

FEATURE PAGE 32

SAVVY ADVOCACY: GETTING YOUR LEGISLATOR’S ATTENTION Learn how to effectively advocate, in person or online, with a few simple steps.

THE HIGH-STAKES 2020 CENSUS A historic pandemic and other roadblocks marked the gathering and release of data from the latest decennial survey of America’s population.

Special Feature

Columns

51 NARFE 2020 Financial

4 From the President

Statements

Washington Watch

6 New Postal Reform

Legislation Could Raise FEHB Premiums

7 White House Budget Proposes 2.7 Percent Raise, OPM IT Modernization

8 NARFE Members

Enthusiastically Advocate During Grassroots Advocacy Month

9 FEVS Reports Increased

Federal Job Satisfaction During Pandemic

10 Bill to Protect Merit-

Based Civil Service Clears Committee

22 Benefits Brief

A NARFE PUBLICATION FOR FEDERAL EMPLOYEES AND RETIREES

August 2021 VOLUME 97 ★ NUMBER 6

P. 24

Savvy Advocacy

42 Managing Money Departments

P. 32

The High-Stakes 2020 Census

16 Questions & Answers 44 For the Record

P. 51

NARFE Financial Statements

ON THE COVER Illustration by TGD

46 NARFE News 62 Member Perks 64 The Way We Worked

Connect with us! Visit us online at www.narfe.org Like us on Facebook NARFE National Headquarters Follow us on Twitter @narfehq

12 Bill Tracker NARFE MAGAZINE www.NARFE.org

AUGUST 2021 VOLUME 97 ★ NUMBER 6

REGIONAL VICE PRESIDENTS

EDITORIAL DIRECTOR Jenn Rafael

REGION I James C. Risner

SENIOR EDITOR Mabel Yu CONTRIBUTING EDITOR Jessica Klement CREATIVE SERVICES MANAGER Beth Bedard ADDITIONAL GRAPHIC DESIGN TGD EXECUTIVE EDITOR Helen Mosher EDITORIAL BOARD Kenneth J. Thomas, Kathryn E. Hensley, Barbara Sido CONTACT US NARFE Magazine 606 North Washington St. Alexandria, VA 22314-1914 Phone: 703-838-7760 Fax: 703-838-7781 Editorial: communications@narfe.org Advertising Sales: Anita Nelson advertising@narfe.org

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 NFBNEWSLINE® service at 866-504-7300 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.

NARFE MAGAZINE AUGUST 2021

NATIONAL OFFICERS KENNETH J. THOMAS President; natpres@narfe.org KATHRYN E. HENSLEY Secretary/Treasurer natsectreas@narfe.org

EXECUTIVE DIRECTOR BARBARA SIDO execdir@narfe.org

(Connecticut, Maine, Massachusetts, New Hampshire, New York, Rhode Island and Vermont) Tel: 207-540-6233 Email: rvp1@narfe.org

REGION II Gary Roundtree Sr. (Delaware, District of Columbia, Maryland, New Jersey and Pennsylvania) Tel: 443-929-7045 Email: groundtreesr@comcast.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 IV Robert L. Helfrich (Illinois, Indiana, Michigan, Ohio and Wisconsin) Tel: 317-501-1700 Email: rlhelfrich@yahoo.com

REGION V Cindy Reneé Blythe

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 “My Account”

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

(Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota and South Dakota) Tel: 785-256-1450 Email: mrsdocbusyb@yahoo.com

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 Robert H. Ruskamp (California, Hawaii, Nevada and Republic of Philippines) Tel: 703-628-3234 Email: rvp8@narfe.org

REGION IX Linda L. Silverio (Alaska, Idaho, Montana, Oregon and Washington) Tel: 503-391-2963 Email: l.l.silverio.narfe@gmail.com

REGION X William Shackelford (Kentucky, North Carolina, Tennessee, Virginia and West Virginia) Tel: 703-830-6590, CELL: 703-201-6304 Email: rvp10@narfe.org

NARFE Magazine (ISSN 1948-4453) is published monthly except in February and July 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 $48. 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 © 2021, 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 Magazine, but at the same time we will not undertake to guarantee the reliability of our advertisers.

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From the President NARFE’S MISSION STATEMENT To support legislation and regulations beneficial to federal civilian employees and annuitants and potential annuitants under any federal civilian retirement system and to oppose those detrimental to their interests. To promote the general welfare of federal civilian employees and annuitants and potential annuitants, to advise and assist them with respect to their rights under retirement, health and other employee and retiree benefits laws and regulations, and to represent their interests before appropriate authorities. To cooperate with other organizations and associations in furtherance of these general objectives.

An Active August

he buzz in DC lately has covered a range of topics. COVID-19 cases and deaths are about the lowest

they have been since March 2020. In an era of hyperpolarized politics, President Biden remains nostalgic for his old-school dealmaking approach on infrastructure and how to pay for it. Immigration, the jobs report and the budget make up the administration’s remaining agenda items for 2021. Can the two parties reach consensus on major policy proposals? President Biden must address our most basic needs—high-quality, affordable health care; safe, accessible housing; top-notch education; food security; paid family or sick leave; and child care. These needs are universal and access to them should not be determined by skin color, income or geographical location. In August, members of Congress “recess,” during which they return to their home states. As such, NARFE designates August as Grassroots Advocacy Month. This is your opportunity to move the policy needle, making sure that elected officials know about and understand NARFE’s concerns. Many members of Congress will hold town-hall-style meetings to hear what their constituents have to say. These events are great opportunities to let

NARFE MAGAZINE AUGUST 2021

elected representatives know what is important to you. Using the vast resources on NARFE’s advocacy webpage, be sure to articulate how issues affect you personally. In the past, face-to-face meetings with lawmakers during the August recess were commonplace. You could engage them at state and county fairs, town halls and one-on-one meetings. The new normal, however, may place restrictions on in-person events and large gatherings. Regardless of the meeting method, the same general principles apply—have a concise, effective message; keep it simple; tell your story; and have a clear “ask.” Don’t forget to keep your conversation local with stateand district-specific information. After the meeting, send a thank you note and include any necessary follow-up information. Don’t let the congressional recess pass by without expressing NARFE’s views. Please contact advocacy@narfe.org with questions about how to participate in advocacy activities during NARFE’s Grassroots Advocacy Month. As America appears to be turning the corner on the coronavirus pandemic, consider spending time with friends and family that you haven’t seen in a while. As always, stay safe. I look forward to seeing you soon.

KENNETH J. THOMAS NARFE NATIONAL PRESIDENT natpres@narfe.org

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Washington Watch

New Postal Reform Legislation Could Raise FEHB Premiums

ong sought-after legislation to reform the U.S. Postal Service (USPS) has returned to Congress, with bipartisan bills introduced in both the House and Senate meant

to place USPS on better financial footing. The Postal Service Reform Act of 2021, H.R. 3076 and S. 1720, is designed to save USPS billions of dollars over the next decade, but NARFE is concerned that the legislation could inadvertently cause premiums to rise for health plans under the Federal Employees Health Benefits (FEHB) program. The bill would end the 2006 mandate requiring the Postal Service to prefund billions of dollars of future retiree health benefits, payments that USPS has been unable to make fully. It would also engender a new Postal Service Health Benefits (PSHB) program, creating separate health plans for postal employees and retirees, parallel to current FEHB plans and required to be “actuarially equivalent.” Current postal employees would be required to enroll in a new PSHB plan and also would be required to enroll in Medicare when they turn 65.

NARFE MAGAZINE AUGUST 2021

Postal retirees younger than 65 would have the option to enroll in either an FEHB or PSHB plan. But once a retiree is eligible for Medicare (age 65), enrollment in Medicare would be required upon enrollment in a PSHB plan, and the retiree cannot go back to an FEHB plan. Of particular interest to NARFE members: Current postal retirees age 65 and older without Medicare would have a new opportunity to enroll in Medicare Part B without a late penalty, but the legislation does not require enrollment as it did in previous bills—a change

NARFE has been advocating for over the years. All postal employees and retirees would be moved to the new PSHB program, except those Medicare-eligible postal retirees who do not enroll in Medicare Part B during the special enrollment period; these retirees would stay in FEHB. Retirees without Medicare tend to cost more to insure, as older individuals use more health care, on average, than younger ones. As such, this exception could increase the average cost of coverage for FEHB plans, which could then lead to an increase in FEHB premiums for all participants. In a letter to the Senate Committee on Homeland Security and Governmental Affairs, NARFE urged lawmakers to amend the bill and consider feedback and analysis from the Office of Personnel Management (OPM), the agency that administers FEHB and would administer the PSHB program. Shortly thereafter, a

MYTH VS. REALITY MYTH: The August congressional recess is a time for members of Congress to go on a month-long vacation and shirk their job duties. REALITY: While Congress may not be in session during August, lawmakers are working in their home districts—holding town halls, meeting with constituent groups and attending other public events to connect with those they serve. This gives NARFE members great opportunities to meet with their legislators and talk about NARFE’s priorities.

spokesperson from OPM told Federal News Network “OPM is working with Congress to address concerns involving how the health care provisions of the legislation will impact the cost and delivery of health care benefits and services for federal employees and other FEHBP beneficiaries.”

It is NARFE’s position that a new program should retain all postal employees and retirees, rather than singling out and excluding retirees without Medicare, a move that could set a dangerous precedent for the future of the FEHB program. NARFE is continuing to work with lawmakers to address these

concerns, but if they are not adequately handled, NARFE will urge opposition to this or any other bill that undermines the earned health benefits of our nation’s current and former public servants. —BY ROSS APTER, POLITICAL ASSOCIATE

White House Budget Proposes 2.7 Percent Raise, OPM IT Modernization

ederal employees could receive a 2.7 percent average pay increase for calendar year 2022, if the proposed raise in the Biden administration’s fiscal year 2022 (FY 2022) budget request holds. The $6 trillion proposal, published by the White House in May, seeks a 16 percent rise in nondefense discretionary spending over FY 2021 levels. Defense spending would see a modest bump of 1.7 percent from FY 2021. Presidential budgets are commonly released in February, but the first one from a new administration is usually delayed due to the late-January inauguration date. NARFE National President Ken Thomas applauded the administration’s proposed 2.7 percent average pay increase

for federal employees, and he urged Congress to approve the

THE $6 TRILLION PROPOSAL, PUBLISHED BY THE WHITE HOUSE IN MAY, SEEKS A 16 PERCENT RISE IN NONDEFENSE DISCRETIONARY SPENDING OVER FY 2021 LEVELS.

raise in the coming months. Thomas noted that the proposal recognizes and respects hardworking civil servants who

have “rededicated themselves to performing at high levels while weathering a global pandemic,” and that meaningful, marketbased pay raises are key to improving federal recruitment and retention. The 2.7 percent average pay increase also restores pay parity for federal civilian employees, as the raise matches the president’s proposed pay increase for military members. The previous administration rejected pay parity, proposing pay raises for the military while pushing for pay freezes for federal employees. The budget request also asks Congress to appropriate money for an Information Technology Working Capital Fund for the Office of Personnel Management (OPM), which would give the SEE BUDGET ON P. 10

NARFE MAGAZINE www.NARFE.org

Washington Watch

NARFE GRASSROOTS ADVOCACY LEARN MORE about how you can take action to protect your earned pay and benefits by reviewing NARFE Grassroots materials at www.narfe.org/advocacy.

NARFE Members Enthusiastically Advocate During Grassroots Advocacy Month

ARFE’s advocacy program is growing stronger each day, with members stepping up and joining advocacy efforts to protect and enhance the interests of the active and retired federal community from policies and legislation that threaten to reduce or eliminate their earned benefits. NARFE applauds its members for recognizing that lobbying alone cannot get the work done; it takes a collaborative effort by the entire NARFE community to succeed. This enthusiasm is why we are primed for NARFE’s Grassroots Advocacy Month. Each August, NARFE rolls out its Grassroots Advocacy Month campaign to connect members with their lawmakers, who are returning to their home districts and states for the congressional recess. The recess, which lasts until Labor Day, provides legislators with ample opportunities to meet with their constituents, so NARFE ensures that members take advantage of this time to continue discussions on its legislative priorities. This year, participants are engaging in various campaign activities, including using NARFE’s Legislative Action Center to send policy-specific letters to lawmakers and to editors of local news media. NARFE is again engaging

NARFE MAGAZINE AUGUST 2021

members in a social media campaign designed to reach more members. NARFE also encourages advocates to engage with their lawmakers via social media to foster meaningful discussions about Windfall Elimination Provision (WEP) repeal and reform. Connecting with your legislators on platforms

NARFE APPLAUDS ITS MEMBERS FOR RECOGNIZING THAT LOBBYING ALONE CANNOT GET THE WORK DONE; IT TAKES A COLLABORATIVE EFFORT BY THE ENTIRE NARFE COMMUNITY TO SUCCEED. like Facebook and Twitter is integral to capturing their attention. See this issue’s cover story on Page 24 for advocacy tips, including ones for social media use. Spurred to enact change, hundreds of members participated in NARFE’s virtual legislative training conference, LEGcon21, in June. The conference, NARFE’s first full-

scale virtual conference, included training programs for members at different levels of advocacy experience, helping them gain new skills to be more effective in the field and to improve advocacy engagement within their federation and chapter. Participants heard from policy experts, agency representatives and nearly a dozen members of Congress, including House Committee on Oversight and Reform Chairwoman Carolyn Maloney, D-NY, and Rep. Rodney Davis, R-IL. Davis is the sponsor of the Social Security Fairness Act, NARFE-supported legislation that would repeal the WEP and Government Pension Offset (GPO). Advocates, including federation and chapter leaders, were quickly able to implement the new skills and strategies they learned as they engaged in a virtual lobby day with lawmakers on the third day of the conference. NARFE thanks its advocates for their continued support of advocacy and their engagement in Grassroots Advocacy Month and LEGcon21. If you are a member who would like to learn more about advocacy or join other NARFE voices in advocacy activities, please contact the advocacy department at advocacy@narfe.org. —BY MARSHA PADILLA-GOAD, GRASSROOTS PROGRAM MANAGER

FEVS Reports Increased Federal Job Satisfaction During Pandemic

espite sudden, farreaching changes to how work was conducted due to the COVID-19 pandemic, federal employees reported increased job satisfaction and employee engagement in the 2020 Federal Employee Viewpoint Survey (FEVS). The FEVS is administered annually by the Office of Personnel Management (OPM) to survey the “organizational climate” of the federal government at large, as well as within individual agencies. The survey measures the perspectives of federal employees across job types, agencies and locations on a wide variety of topics, with a particular focus on management practices, policies and workplace experiences. For 2020, the FEVS was distributed as a census to all permanent and nonseasonal federal employees. Some 44 percent of the federal workforce, or 624,800 employees, responded. Participant demographics were varied, with Generation X (those born 1965-1980) making up the largest pool of respondents, at 46 percent. Baby boomers (1946-1964) came second, at 31 percent, and Generation Y (1981-1996), commonly known as millennials, made up 22 percent of respondents. Notably, 27 percent of respondents had a federal tenure of more than 20 years, and 30 percent of respondents were veterans. Forty-five percent of survey participants were female, and 36 percent were members of minority groups. Results from the survey included a 4 percent increase in overall employee engagement over 2019 levels, with 72

percent of survey participants approving of agency leaders, direct supervisors and their overall work experience. Survey participants also reported improvements in overall work environment, rewards and recognition, and opportunities for professional development and growth.

necessary and available for use; 64 percent said PPE was readily available at their worksite; and 61 percent said cleaning and sanitizing supplies were present at their worksite. More than 75 percent of federal employees said their agency provided clear and consistent communication about organizational status

Participants were surveyed on workplace flexibilities and necessities related to the COVID-19 pandemic, including the use and availability of telework, personal protective equipment (PPE) like masks or gloves, and health and safety protocol training. Around 59 percent of federal employees teleworked every workday during the peak of the pandemic, compared with just 3 percent before the pandemic. Kathleen McGettigan, OPM’s acting director, cited flexibilities like telework as key factors in ensuring that employees could remain safe and healthy while accomplishing agencies’ missions. Most survey respondents noted that pandemic-related organizational support was provided: 65 percent said expanded telework was

and what to expect in their workplace moving forward. Despite improvements to job satisfaction and employee engagement, the pandemic appeared to disrupt workplace effectiveness in many areas. Of the respondents, 23 percent reported that the onset of the pandemic was either extremely or very disruptive to their ability to do work. Nearly half of employees, 48 percent, reported greatly or somewhat increased work demands brought on by the pandemic. Overall workplace effectiveness saw some declines during the pandemic but still managed to retain positive ratings. For example, 86 percent of respondents reported that their work unit met the needs of customers during COVID-19, an 8 percent decline from the 94 percent recorded prepandemic. —BY SETH ICKES, GRASSROOTS ASSISTANT NARFE MAGAZINE www.NARFE.org

Washington Watch LEGISLATIVE RESOURCES NARFE NewsLine – A weekly newsletter that goes out to NARFE members on Tuesdays and includes weekly recaps of legislative news, compiled by NARFE’s advocacy and communications teams. LEGISLATIVE ACTION CENTER – A one-stop site to send a letter to Congress, and more, at www.narfe.org.

Bill to Protect Merit-Based Civil Service Clears Committee

ongress inched closer to passing NARFEsupported legislation that would permanently protect the merit-based civil service from a return to the so-called “spoils system” of the 19th century. In 2020, the previous administration’s Executive Order (EO) 13957 briefly created Schedule F, a new federal employment category threatening the integrity of the merit-based, nonpartisan federal civil service— the government’s standard since the late 1800s. In January of 2021, President Biden rescinded the EO, eliminating the new category and returning affected

employees to their previous work schedules. NARFE staunchly opposed EO 13957 and lobbied both Congress and the new administration to overturn it. Without definitive legislative action from Congress, the threat of future administrations implementing similar executive orders remains. In May, the House Committee on Oversight and Reform voted to advance the Preventing a Patronage System Act, H.R. 302, introduced by Reps. Gerry Connolly, D-VA, and Brian Fitzpatrick, R-PA, which would require future administrations to obtain the express agreement of Congress to reclassify

BUDGET FROM P. 7

Additionally, President Biden’s budget proposes investing $500 million in the federal government’s Technology Modernization Fund, while the burgeoning Cybersecurity and Infrastructure Security Agency would receive an additional $110 million toward its efforts to improve cybersecurity. Another $750 million would be allocated to “additional investments tailored to respond to lessons learned from the SolarWinds incident,” a major cybersecurity attack in 2020 that breached data at the Departments of the Treasury and Commerce.

agency additional funding to drive information technology modernization and increased efficiency in human capital management. OPM, the federal government’s chief human resources agency, has been seeking to improve its IT for years but has met repeated roadblocks, as detailed in a report from the National Academy of Public Administration. While the administration’s proposal is a step in the right direction, NARFE recommends Congress put sufficient guardrails on its appropriations to ensure effective use of any new money. 10

NARFE MAGAZINE AUGUST 2021

competitive service positions outside of merit system principles. Had the Schedule F EO been fully implemented, tens, or even hundreds, of thousands of federal jobs “of a confidential, policy-determining, policymaking or policyadvocating character” could have been converted into the new Schedule F classification within the excepted service. Reclassified employees would have been exempted from civil service rules and due process rights that ensure civil servants are hired based on merit, not political affiliation. —BY SETH ICKES, GRASSROOTS ASSISTANT

Beyond provisions affecting the federal community, the budget proposes $8.7 billion in funding for the Centers for Disease Control and Prevention (CDC) to improve the agency’s readiness to tackle “future public health crises” similar to the COVID-19 pandemic. The administration also plans to launch a new $6.5 billion research project, dubbed the Advanced Research Projects Agency for Health, that will focus on “health breakthroughs” in cancer, diabetes and Alzheimer’s disease. —BY SETH ICKES, GRASSROOTS ASSISTANT

Only $20 National Active and Retired Federal Employees Association

NARFE’s CONGRESSIONAL DIRECTORY FOR THE 117 th CONGRESS (2021-2022)

CONGRESSIONAL DIRECTORY 117th Congress 2021-2022

Features: • Members of Congress by state delegation, with color photos, biographical data and congressional district maps. • Members’ contact information, including addresses, phone and fax numbers, website addresses, social media contacts, district offices and key staffers. • Complete listings of committees, subcommittees and leadership. • Contact information for the White House, Cabinet, Supreme Court and federal agencies.

Be a stronger advocate with NARFE’s Congressional Directory at your fingertips

Order your copy of the new CONGRESSIONAL DIRECTORY today! Name __________________________________________________________ Address ________________________________________________________ City_____________________________________ State _____ ZIP _________ Member ID# (as it appears on NARFE Magazine label) _____________________

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Please allow 3-4 weeks for delivery. Call NARFE’s Advocacy Department at 800-456-8410, option 3, to order by phone.

Washington Watch

NARFE BILL TRACKER

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

NARFE CENTENNIAL

BILL NUMBER / NAME / SPONSOR H.Res. 131/S.Res. 76: Resolution Celebrating NARFE’s Centennial / Rep. Gerry Connolly, D-VA / Sen. Ben Cardin, D-MD Cosponsors: H.Res. 131: 9 (D) 3 (R) S.Res. 76: 3 (D) 2 (R) H.R. 3076/S. 1720: The Postal Service Reform Act / Rep. Carolyn Maloney, D-NY / Sen. Gary Peters, D-MI Cosponsors: H.R. 3076: 17 (D) 16 (R) S. 1720: 12 (D) 11 (R) 1(I)

POSTAL REFORM

WHAT BILL WOULD DO

LATEST ACTION(S)

Congratulates NARFE on the celebration of its 100th anniversary on February 19, 2021 and recognizes the vital contributions its members have made to the United States during the past 100 years.

Referred to the House Committee on Oversight and Reform (H.Res. 131) / Agreed to in the Senate by unanimous consent on February 25, 2021 (S.Res. 76)

Creates a new Postal Service Health Benefits (PSHB) program starting in January 2023. All postal employees and retirees would be moved to the new PSHB program, except Medicare-eligible postal retirees who do not enroll in Medicare. Because retirees without Medicare tend to cost more to insure, this bill risks increasing premiums for federal employees and retirees enrolled in Federal Employees Health Benefits (FEHB) program plans.

Advanced from the House Committee on Oversight and Reform by voice vote (H.R. 3076) / Referred to the Senate Committee on Homeland Security and Governmental Affairs (S. 1720)

H.R. 695/S. 145: USPS Fairness Repeals the U.S. Postal Service’s Act / Rep. Peter DeFazio, D-OR / prefunding requirement. Sen. Steve Daines, R-MT Cosponsors: H.R. 695: 216 (D) 56 (R) S. 145: 5 (D) 5 (R) H.R. 82/S. 1302: The Social Security Fairness Act / Rep. Rodney Davis, R-IL / Sen. Sherrod Brown, D-OH

GPO/WEP

DC STATEHOOD

H.R. 2337: The Public Servants Protection and Fairness Act / Rep. Richard Neal, D-MA

H.R. 304: The Equal COLA Act / Rep. Gerry Connolly, D-VA Cosponsors: H.R. 304: 17 (D) 3 (R) H.R. 51/S. 51 Washington D.C. Admission Act / Del. Eleanor Holmes Norton. D-DC / Sen. Thomas Carper, D-DE

Reforms the Windfall Elimination Referred to the House Provision (WEP) by providing a monthly Committee on Ways and rebate of $150 to current beneficiaries Means (age 62 or older before 2023) and creating a new formula to calculate benefits for future WEP-affected individuals (turning 62 in or after 2023). Provides Federal Employees Retirement Referred to the House System (FERS) retirees with the same Committee on Oversight annual cost-of-living adjustment (COLA) and Reform as Civil Service Retirement System (CSRS) retirees. Provides for the admission of the State of Washington, DC, into the Union.

Cosponsors: H.R. 51: 216 (D) 0 (R) S. 51: 44 (D) 0 (R) 1 (I) NARFE’s Position: 12

Referred to the House Committee on Ways and Means / Referred to Senate Committee on Finance

Cosponsors: H.R. 82: 128 (D) 47 (R) S. 1302: 25 (D) 4 (R) 2 (I)

Cosponsors: H.R. 2337: 170 (D)

FEDERAL ANNUITIES

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

Referred to the House Committee on Oversight and Reform (H.R. 695) / Referred to the Senate Committee on Homeland Security and Governmental Affairs (S. 145)

NARFE MAGAZINE AUGUST 2021

Support

Passed the House 4/22/21 by a vote of 216-208 / Referred to the Senate Committee on Homeland Security and Governmental Affairs (S. 51)

Oppose

No position

NARFE BILL TRACKER

THE NARFE BILL TRACKER IS YOUR MONTHLY GUIDE TO LEGISLATION NARFE IS FOLLOWING. CHECK BACK EACH ISSUE FOR UPDATES. BILL NUMBER / NAME / SPONSOR

ISSUE

FEDERAL PERSONNEL POLICY

FEDERAL COMPENSATION

WHAT BILL WOULD DO

LATEST ACTION(S)

H.R. 302: Preventing a Patronage Requires presidential administrations to obtain the agreement of Congress to System Act / Rep. Gerry reclassify competitive service positions Connolly, D-VA outside of merit system principles. Cosponsors: H.R. 302: 9 (D) 3 (R) H.R. 392/S. 561: The Federal Adjustment of Income Rates (FAIR) Act / Rep. Gerry Connolly, D-VA / Sen. Brian Schatz, D-HI

Advanced from the House Committee on Oversight and Reform in a 22 – 18 vote

Provides federal employees with a 3.2 percent average pay raise in 2022.

Referred to the House Committee on Oversight and Reform (H.R. 392) / Referred to the Senate Committee on Homeland Security and Governmental Affairs (S. 561)

Cosponsors: H.R. 392: 50 (D) 1 (R) S. 561: 11 (D) 0 (R) 1 (I) NARFE’s Position:

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Questions & Answers

Q&A

THE FOLLOWING QUESTIONS & ANSWERS were compiled by NARFE’s Federal Benefits Institute experts. NARFE does not provide legal, financial planning or tax advice or assistance.

EMPLOYMENT MILITARY SERVICE DEPOSIT

I’m a Federal Employees Retirement System (FERS) employee who just returned to duty after a period of nonpay status while performing military service. I’m interested in making a deposit into FERS for this period. What is the process for initiating this?

To begin the process of paying your military service deposit, locate your military discharge certificate (Form DD-214 or equivalent). Ensure that it shows your beginning and ending dates of active service characterized as an honorable discharge. If you did not receive a DD-214, such as for active duty in the reserve component, then you can use orders that show the date you were ordered to active duty and the date of discharge. Since it seems like you currently belong to a military unit, you can also ask your unit military personnel office for assistance. You will also need military basic pay information. If you do not have any military pay 16

NARFE MAGAZINE AUGUST 2021

documents that show the exact basic pay you earned while on active duty for this period of leave without pay (LWOP), you can request an estimate from the appropriate military finance center using form RI 20-97 “Estimated Earnings During Military Service.” Next, complete form SF 3108 - “Application to Make Service Credit Payment: FERS” to apply to make this deposit through your agency. Your agency retirement office should process the SF 3108 and forward it to your payroll office along with your elected payment option. The forms are available at www.opm.gov/forms. The initial amount owed will be the lesser of 3 percent of

your military basic pay or the amount of FERS deductions that would have been withheld from your federal civilian pay had you not been on LWOP. The military deposit will begin to accrue interest on the second anniversary of your return to duty as a civilian federal employee, with no interest due until the third anniversary. After the two-year interestfree period, interest is accrued and compounded annually at a variable interest rate. You have until the date of your separation from federal service to complete the payment of the military deposit; partial payment is not allowed.

SOCIAL SECURITY SPOUSAL BENEFIT

I divorced after 15 years of marriage and never remarried. I am still working under the Civil Service Retirement System (CSRS) and approaching my full retirement age (FRA) for Social Security. My former

spouse died several years after our divorce. I recently heard that I might be entitled to a widower benefit from Social Security based on her work record, but due to the Government Pension Offset (GPO), I am unable to collect this benefit from Social Security because I’m CSRS. Is this true?

If I retire with a FERS disability retirement at age 47 with 20 years of FERS service, how is my annuity computed?

Since you were married for more than 10 years, if you did not remarry before age 60, you are potentially eligible for a former spouse survivor benefit based on your late ex-spouse’s Social Security work record. Even though you are still working, once you reach your FRA for Social Security, the earnings test that typically prevent workers from claiming Social Security at a younger age no longer applies. Keep in mind that you will not be subject to the GPO until you retire from federal service under CSRS. While you continue your federal career beyond your FRA, you may collect 100 percent of the former spouse survivor benefit your ex earned for you. But once you retire from federal service, be prepared for the GPO to significantly reduce your survivor benefit from Social Security. In most cases, your survivor benefit will be reduced to $0. The only benefit you are likely to receive from Social Security once you’re retired is the Social Security you may have earned based on your own private-sector work record (subject to the Windfall Elimination Provision).

RETIREMENT DISABILITY RETIREMENT

FERS disability retirement benefits are computed as 60 percent of your high-three average salary for the first 12 months (offset by 100 percent of any Social Security disability you might receive). At age 47 with 20 years of FERS service, your benefit will be computed under the disability computation since you are too young to receive an immediate, unreduced retirement benefit. Under the FERS disability formula, starting the 13th month, you would receive 40 percent of the same high-three average salary until you reach age 62 (offset by 60 percent of any Social Security disability you might receive). At age 62, OPM will no longer reduce your disability annuity by any benefits you might be receiving from Social Security. OPM will automatically recalculate your annuity using the regular FERS formula as if you had been working since the date of your separation. It will include the creditable service you had before the date of separation and an adjustment to your high-three average salary based on the FERS COLAs received during your previous years of retirement.

Since you will have more than 20 years of service at age 62, your FERS benefit will be recomputed using the FERS 1.1 percent factor. You will qualify for 38.5 percent of your adjusted high-three average salary starting at age 62, based on 35 years of actual and projected service. Note: If you were a special group employee (e.g., law enforcement officer, firefighter, air traffic controller) upon separation for FERS disability retirement, for the automatic re-computation at age 62, OPM would use the 1.7 percent factor up to a maximum of 20 years, and the remaining years would be computed at the 1 percent factor rate. • 1.7 percent x 20 years of special group service = 34 percent • 1 percent x 15 years of disability retirement from age 47 to age 62 = 15 percent • Total = 49 percent Even though special group employees typically have mandatory retirement ages prior to age 62, the automatic recalculation of a FERS disability retirement still includes service credit for the time between the employee’s separation from federal service and his or her reaching age 62.

CSRS OFFSET

I spent several years as a CSRS Offset employee before retiring from federal service at age 59. When should I expect OPM to reduce my annuity since my required contributions into CSRS were reduced by my required contributions into Social Security NARFE MAGAZINE www.NARFE.org

Questions & Answers

(FICA tax) for the latter portion of my federal career?

As a CSRS Offset employee, you were covered by both CSRS and Social Security. In order for you to not have to pay both the 7 percent CSRS retirement contribution and the 6.2 percent FICA tax, the law required that your CSRS contributions were “offset” by the FICA tax. If you qualify for Social Security retirement at age 62 (or at your actual retirement, if later than age 62), then OPM will offset (reduce) your CSRS annuity at age 62 (or later) based on the Social Security retirement you earned during your years of federal employment as a CSRS Offset employee. You must earn at least 40 Social Security credits to qualify for Social Security benefits. There is no offset if you do not qualify for Social Security. Your CSRS benefit will be offset at age 62 if you are qualified for Social Security, even if you decide to wait to claim your Social Security retirement until later. The good news is that OPM computes the offset based on the amount of Social Security potentially payable at age 62 and not the larger amount that you may claim at a later age. Sometimes the offset is delayed, so be aware that if your retirement is not reduced the month after you have reached age 62, you may receive a notice from OPM requesting repayment of any overpayments. Consider contacting OPM if your annuity has not been reduced within a few months after you reach your 62nd birthday.

NARFE MAGAZINE AUGUST 2021

FEHB AND MEDICARE

My spouse previously opted out of her employer’s health insurance plan because she is covered under my Federal Employees Health Benefits (FEHB) plan through my retirement. Although I’m only 57 and won’t be eligible for Medicare for another eight years, my spouse will reach age 65 later this year. Someone told her that if she works beyond 65, she has the option to delay her enrollment for Medicare without any penalty until she stops working. Is this accurate?

Since your spouse is not covered by current employment health insurance of her own, and because you have retired, which covers her under a retiree plan (as opposed to an employee plan), she may incur the late enrollment penalty for delaying enrollment in Medicare Part B. There is a permanent 10 percent late enrollment surcharge for every 12 months enrollment is delayed. Section 9 of your FEHB plan brochure describes how your health plan will coordinate with Medicare once she reaches age 65. For specific information, contact your FEHB plan. If your spouse plans to continue working beyond age 65, depending on the size of the employer, she may be able to enroll in her employer’s health plan to delay Medicare Part B without incurring a late enrollment penalty. See www. medicare.gov/sign-up-changeplans/i-have-employer-coverage. Enrolling in Medicare is one of the most confusing decisions that

federal retirees and their spouses must make since your FEHB plan will cover you even if you choose not to enroll in Medicare Part B. For more details watch the webinar, “To B or Not to B: Is Medicare Part B Right for You?” (October 2020), archived at the NARFE Federal Benefits Institute (www.narfe.org/federal-benefitsinstitute). There are also several other webinars available in the Institute related to Medicare and FEHB you may find interesting and helpful.

FERS ANNUITY SUPPLEMENT

If I’m receiving a FERS supplement from OPM, would a disability retirement from Social Security affect this supplement?

No, qualifying for disability retirement benefits from Social Security does not affect the FERS retirement annuity supplement (RAS) that is included with your regular retirement from OPM. However, when you reach age 62, your FERS RAS payment will cease.

As a reemployed annuitant, will OPM include the amount of any FERS RAS when computing the offset to my salary based on my retirement?

In exceptional circumstances, upon reemployment in the federal government, a retiree’s annuity may be continued and he or she may receive a full salary without offset if approved

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Questions & Answers

for a waiver of the offset. When an annuitant returns to federal service without a “dual compensation” waiver, the salary offset is computed on the gross annuity from OPM. According to OPM, the FERS RAS is not part of the gross annuity for this purpose, so the agency would not reduce the salary for the annuity supplement. However, the supplement may be reduced or terminated due to the earnings test. For additional information about returning to federal service

after retirement, watch the webinar, “Act II – How Federal Reemployment Affects Your Benefits” (April 2020), archived at the NARFE Federal Benefits Institute (www.narfe.org/federalbenefits-institute). 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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Benefits Brief

Accessing Benefits: Survivors of Active Federal Employees

here are many benefits that protect a surviving spouse and dependent children in the unfortunate event that a federal employee passes away while in service.

To start the process, contact the personnel office of the federal agency where the employee worked. If you’re not sure where to begin, you may locate a personnel list by contacting the Benefits Officer at the agency, found at www.opm.gov/retirementservices/benefits-officers-center/ agency-benefits-officers. You will need to provide court documents appointing the executor or administrator and a copy of the Taxpayer Identification Number (TIN). Be prepared to provide information on any prior marriages as well as the names and ages of any children, including children who may be deceased. If the employee’s death was accidental, submit the coroner’s report, news clippings or police reports documenting the accident. To claim payable benefits, you will need multiple copies of the death certificate. The employee’s service history and salary determine the value of survivor benefits. Look for copies of Standard Form 50 - “Notification of Personnel Action” statements and Leave and Earnings Statements, or meet with the human resources specialists at the deceased’s employing agency to be sure there is adequate documentation of the federal service. Several other documents may be necessary: • If you are the spouse, you will need copies of your marriage certificate. 22

NARFE MAGAZINE AUGUST 2021

• If there are surviving dependent children, you will need to provide a copy of each child’s birth certificate. • If you are the former spouse, you will need copies of your divorce decree or Court Order Acceptable for Processing. • If the employee was receiving benefits due to a work-related injury through the Federal Employees Compensation Act (FECA), you will need the claim number to file for benefits. Medical evidence must show that the work-related condition contributed to the death. If you are filing on behalf of the beneficiary, you may need a copy of the appointment papers naming you as the attorney-infact for the beneficiary. • To access online accounts such as the TSP, insurance coverage, Social Security and other investments and retirement accounts, you will need the usernames and passwords to determine current coverage/value. Eligible survivors are entitled to the same Federal Employees Health Benefits (FEHB) plan and government contribution as active employees enrolled in the same plan. The survivor’s share of the premium is normally deducted from his or her annuity payment. If the survivor is not entitled to a monthly annuity (typically for employees who worked more than 18 months but less than 10 years), arrangements

can be made to pay the Office of Personnel Management (OPM) directly. Survivors are not eligible for FEHB benefits if the deceased was not enrolled in either a Self Plus One or Self and Family plan on the date of death. If enrollment doesn’t continue, survivors may qualify for Temporary Continuation of Coverage (TCC). There are informational pamphlets and forms on OPM’s website, www.opm.gov, that are helpful for survivors: • SF 3114 - “Applying for Death Benefits: FERS” pamphlet • SF 3104 - “Application for Death Benefits: FERS” • SF 3104B - “Documentation and Elections in Support of Application for Death Benefits When Deceased Was an Employee at the Time of Death: FERS ” (spouse or former spouse with courtordered benefits) • SF 2800 - “Application for Death Benefits: CSRS” Survivors may be entitled to additional benefits. Be sure to discuss the Federal Employees’ Group Life Insurance (FEGLI) with the agency personnel office. Also contact the Thrift Savings Plan (TSP) and Social Security Administration to determine other eligible benefits. —TAMMY FLANAGAN IS THE PRINCIPAL OF TAMMY FLANAGAN LLC (RETIREFEDERAL.COM). SHE IS A FEATURED PRESENTER ON NARFE’S FEDERAL BENEFITS INSTITUTE WEBINARS.

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NARFE MAGAZINE AUGUST 2021

Y V V A S : Y C A C O ADV Getting Your Legislators’ Attention BY STEPHANIE VANCE

rom deciding on benefits and pay rates to revitalizing the federal workforce, policymakers in Congress affect the lives of active and retired federal employees every day and in every

way. Maybe you’re anxious about your finances because your Federal Employees Retirement System (FERS) benefits haven’t kept pace with the cost of living, or your earned federal annuity has reduced your Social Security benefits. Maybe you’re a U.S. Postal Service employee concerned about the agency’s dire financial situation. Or maybe you’re frustrated that federal employees make 23 percent less, on average, than their private-sector counterparts.

NARFE MAGAZINE www.NARFE.org

CURRENT FEDERAL EMPLOYEES, TAKE NOTE:

It may seem obvious to those of you who are worried or frustrated that Congress needs to fix the system. But legislators and their staff won’t understand how their policy decisions impact your life unless you tell them. That’s where advocacy comes into play. Through your advocacy efforts, you let elected officials know what policy proposals are helpful or harmful to your life. Studies from the Congressional Management Foundation have found that personal communications from constituents are the No. 1 way to influence legislators and their staff. Your voice matters. Advocacy isn’t always easy, though. With more than 10,000 bills introduced in a congressional session, getting a legislator’s attention can be challenging—but not impossible. Fortunately, NARFE’s Legislative Action Center, makes it easy for you to engage, providing background on key issues and template emails to send to your policymakers. It’s a great place to go to start advocating right away. From there, you can develop your skills and become a truly effective advocate by employing four strategies: knowing specifically what you want, who you’re talking to, how to talk to them and how to follow-up.

Know What You Want Too many people contact their elected officials to merely “educate” them on a policy issue. While it’s important for legislators to understand the impact of their actions, they also need to know what they can do to fix the problem. For example, if you want to address the Windfall Elimination Provision (WEP), instead of saying, “WEP-reduced Social Security benefits have negatively impacted my retirement,” consider saying something like, “WEP-reduced Social Security benefits have impacted my ability to [fill in the blank]. That’s why I hope you’ll cosponsor the Public Servants Protection and Fairness Act. Will you cosponsor this bill?” The latter statement toggles the switch in a legislator’s or staff person’s brain from merely listening to acting. 26

NARFE MAGAZINE AUGUST 2021

You may have heard that the Hatch Act prohibits you from engaging in advocacy activity. However, most restrictions relate to political activity (i.e., campaign activity) and only when you’re acting in your official capacity. If you fall in a more restricted pool, try to rephrase your “ask.” Adjusting the example on this page, you may be able to say: “WEP-reduced Social Security benefits have impacted my ability to [fill in the blank], and I believe the Public Servants Protection and Fairness Act will help solve that problem.” For more information on what activity the Hatch Act allows and what it prohibits, go to https://osc.gov/Services/Pages/Hatch Act-Federal.aspx.

Research Your Audience Once you know what you want, take time to learn about the people you’ll be approaching so you can frame your message in a way that gets their full attention. Here are three things you need to know, all of which can be gleaned from NARFE’s Legislative Action Center, the NARFE advocacy staff in Washington, DC, or your legislators’ webpages. 1. What issues does my legislator care about? Knowing this will help you frame your message in a way that makes sense to him or her. If the lawmaker really cares about health care, for example, start your outreach with something about retiree health benefits. Look at legislation your lawmaker has introduced, statements on his or her website, committee assignments or even recent press releases to gain an understanding of the legislator’s interests. 2. Where is your lawmaker on the political spectrum? While it’s wise not to bring politics into your discussions, it can be helpful to know how your members of Congress see the world. More conservative members may respond well to defense spending while more liberal members may prefer to hear about equity. 3. Which staff handle NARFE issues? In a legislator’s office, the staff are your most important resources. In fact, it is often more important to have a good relationship with them than with the Representative or Senator. The best way to find out who works on the issues you are concerned about is to call the office and ask.

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VIRTUAL ADVOCACY APPLICATIONS Although the term “virtual advocacy” is all the rage these days, the concept isn’t really new. Email, social media and the plain old telephone can arguably be considered “virtual” engagement. Fortunately, the process for being an effective advocate is the same whether you’re sending an email, meeting in person, meeting online, commenting on social media or sending a carrier pigeon. You still need to know what you want, who you’re talking to, how to talk to them and how to follow-up. The good news is that virtual advocacy can be more effective than in-person advocacy. In its report “The Future of Citizen Engagement: Coronavirus, Congress, and Constituent Communications,” the Congressional Management Foundation found that offices are having numerous and substantive interactions with constituents in this virtual age, and that they’re likely to continue their virtual engagement in the future. In other words, the dreaded Zoom meeting isn’t going away, so if you’re moving from email and phone calls toward video meetings, keep the following in mind. Some staff prefer audio. You may find that staff will use the call-in-only option for video meetings. In general, this doesn’t mean that they don’t like you or that they’re multitasking. It may mean that they don’t have the capacity to do video conferencing or that their office has a policy against it. Or, they may simply have a small apartment with too many roommates and low bandwidth. You’ll need to take steps to avoid making a faux pas. As with any virtual meeting, keep yourself muted when listening and restrict your running commentary to peer-to-peer chat. You don’t want the legislator or staff member hearing or seeing your internal comments. In addition, keep your

NARFE MAGAZINE AUGUST 2021

video background neutral. Political banners or slogans aren’t appropriate in this venue. Finally, it may seem obvious, but … wear pants. As people have gotten more comfortable working from home and behaving more casually, they sometimes forget about this vital component when on camera. Beyond Email, Phones and Zoom: Social Media Social media networks like Facebook, YouTube, Twitter and LinkedIn are very effective for both learning about legislators and for delivering positive messages. Here are some ways to engage: • “Like” your legislators on Facebook (you don’t have to actually like them). Through their Facebook pages, you can get updates on lawmakers’ activities and visits to the district. • Follow members of Congress on Twitter and use it to get up-to-the-minute information on key votes. • Use LinkedIn to find people you may already know who are connected with your Representative and Senators. • Subscribe to your legislators’ YouTube channels to hear them talk about policy issues. You’ll also be able to see what they look like in case you spot them in the district (lawmakers rarely resemble their official pictures). • To be truly effective, move beyond passive reading by commenting on lawmakers’ posts. When you do, be sure to state that you’re a constituent. Because social media isn’t locationspecific, legislators need to know when they’re engaging with people they represent. Also, try to stay positive, as positive comments are far more likely to be noticed than the usual rants.

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Your story doesn’t need to be a grand, sweeping epic. It just needs to incorporate five elements: characters, setting, plot, conflict and resolution.

Develop Your Personal Story Your job is to connect the debate and jockeying that happens in Washington, DC, back to a legislator’s district or state, and the way to do that is through personal stories. Your story doesn’t need to be a grand, sweeping epic. It just needs to incorporate five elements: characters, setting, plot, conflict and resolution. Your characters are the people involved (usually you or people you know). The setting provides context, but it doesn’t have to be a physical location. For example, you can “set” your anecdote in your personal life, as opposed to your work life. The plot is what happened, and the conflict is why it happened. The resolution is your suggestion for how the policymaker can solve the problem. Here’s a brief example: My family and I (characters) have lived in our home for years (setting). After retiring, I had some medical issues that drained much of my savings, leaving me without enough funds to live on. We had to sell our house (plot) because my federal annuity is based on an unfair cost-of-living adjustment (COLA) formula (conflict). I urge you to solve this problem by supporting more accurate COLAs for federal retirees (resolution). This message is more influential because it makes the issue real, as opposed to a dry recitation of facts and figures.

Following Up Unfortunately, sometimes legislators or staff don’t respond to your request. This happens for a variety of reasons. They may have forgotten about the request, they may not have had time to form an opinion on your matter, or they’re waiting to see how much you really want what you’re asking for. All three of these situations can be resolved through effective follow-up. You can remind them about your request, gently prod them to decide on a course of action and demonstrate your commitment to the cause. Be polite but persistent. If you don’t get an answer at first, ask again.

NARFE MAGAZINE AUGUST 2021

Pulling It All Together: The Message Formula

Use the following formula to help you weave each of these elements into a winning message. You can adapt these approaches to any type of communication, whether in-person or online. 1. Start with the fact that you’re a constituent. This establishes relevancy. 2. Provide a brief statement (one or two sentences) about the issue (I’m writing about [X]) to put the topic front and center. 3. If possible, include a “knowing of your interest in” sentence (e.g., Knowing of your involvement in [info about your audience], I think you’ll be interested in this as well). 4. This is important to me because [short personal story]. 5. That’s why I really hope you’ll [ask]. 6. I’d like to follow-up by [follow-up ideas].

Conclusion Being an effective advocate isn’t for the faint of heart, but it’s essential for the health of our democracy. If, in the midst of your third email or fifth Zoom call with a legislator’s office, you begin to doubt your effectiveness, remember the words of Margaret Mead: “Never doubt that a small group of thoughtful, committed citizens can change the world. Indeed, it is the only thing that ever has.” Careful and persistent application of the four main strategies outlined in this article will turn you into one of those very thoughtful, committed citizens who can change the world. So, go forth and advocate. —STEPHANIE VANCE, A 30-YEAR VETERAN OF THE WASHINGTON, DC, POLITICAL SCENE, IS THE AUTHOR OF FIVE BOOKS, INCLUDING CITIZENS IN ACTION: A GUIDE TO INFLUENCING GOVERNMENT AND THE INFLUENCE GAME. SHE’S HELD POSITIONS AS A LOBBYIST, GRASSROOTS CONSULTANT, CONGRESSIONAL AIDE AND ADJUNCT PROFESSOR AT GEORGE WASHINGTON UNIVERSITY.

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The

High-Stakes

NARFE MAGAZINE AUGUST 2021

Census BY DAVID TOBENKIN

NARFE MAGAZINE www.NARFE.org

ull out that dusty copy of the U.S. Constitution (or look at an online copy at https:// constitutioncenter.org/ interactive-constitution/ full-text), and you may be surprised to find that before national defense or a postal service, running a national census every 10 years is the first responsibility set forth for the federal government (Article I, Section 2 of the document).

The Founding Fathers were prescient. The results of the recently completed decennial 2020 census have significant impact. Its numbers: apportion members of the U.S. House of Representatives among states; help draw congressional and state legislative districts, school districts, and voting precincts; distribute more than $675 billion annually to states; inform federal, tribal, state and local government planning decisions; and influence business and nonprofit organization decisions. “The census has always been foundational to the American representative system of government and democracy” and the fair allocation of resources, says Terri Ann Lowenthal, a consultant on census issues who formerly served as staff director of the U.S. House of Representatives Post Office and Civil Service Subcommittee on Census and Population. “I think it is fair to say it is even more so as we become an increasingly datadriven society. The census gathers data that are available to everyone and can be used to help hold government accountable and to help Americans make their own decisions on policies. It is the nation’s gold standard for statistical accuracy.” The U.S. Department of Commerce’s Census Bureau designs, executes and interprets the results of the census, and those results affect many programs federal employees administer. The execution and calibration of the 2020 census faced historic challenges posed by COVID-19; last-minute, controversial interventions and court challenges; and new privacy concerns. As of press time, with specific local data yet to be released, some experts say the jury is still out on how well the 2020 census counted those residing in America.

Initial Results By late April 2021, two types of census data that normally would have been shared by that point had not yet been supplied. First, the Commerce Department must by law present the president with state population figures from the 2020 census by the end of the census year. Congressional apportionment data is then used to determine how many seats in Congress each state is allocated.

NARFE MAGAZINE AUGUST 2021

This data was released by the Census Bureau on April 26. The apportionment results demonstrated a further shift of the nation’s population southward and westward. Texas will gain two seats in the House of Representatives; five states will gain one seat each (Colorado, Florida, Montana, North Carolina and Oregon); seven states will lose one seat each (California, Illinois, Michigan, New York, Ohio, Pennsylvania and West Virginia); and the remaining states’ number of seats will not change. The reapportioned Congress will be the 118th, which convenes in January 2023. The data also show a national population on April 1, 2020, of 331,449,281 and a slowing rate of population growth compared to the preceding 10-year period. Second, redistricting data used to redraw congressional districts across the country were supposed to be transmitted to the states by April 1, 2021. The Census Bureau announced that it would publish unformatted redistricting data by August 16, which it would send to the states in a more user-friendly format by September 30.

The Great Endeavor The decennial census is an extraordinary factfinding journey. It seeks to determine, as of April 1 of the survey year, where each resident of the country lives, as well as the gender, age, race and ethnicity of those residents. Invitations to respond to the survey were sent to most households in March 2020, followed by multiple reminders to complete it. After the self-response period, about half a million temporary Census Bureau employees called enumerators, or census takers, were then sent to residences to obtain information for households that did not respond. For households that still had not been counted, the Census Bureau sometimes turned to data from different levels of government, neighbors or even postal carriers to help add information. In addition to the decennial census, the Census Bureau also conducts an American Community Survey (ACS) on an annual basis, a smaller survey that collects additional information, such as ancestry, citizenship, educational attainment, income, language proficiency, jobs and occupations, migration, disability, employment and housing characteristics.

The persistence of the pandemic greatly complicated enumerators’ efforts to obtain data in person during a time of social distancing, slowing down the count. A Perfect Storm The 2020 census effort began with the same challenges past decennial censuses have had—a relative lack of attention to, and underfunding of, the Census Bureau and the decennial census itself during the middle years between decennial censuses, plus the difficulty of ramping up quickly to count 330 million Americans, Lowenthal notes. New challenges quickly emerged. In 2018, Commerce Secretary Wilbur Ross announced his decision to add a citizenship question to the census. Minority rights advocates challenged the question in court as both inappropriate and likely to force minority communities into the shadows, resulting in their being undercounted for federal dollars and political representation. In July 2019, after a U.S. Supreme Court decision, the proposed citizenship question was withdrawn. Once the count did begin, COVID-19 forced delays at every step of the census, including in enumerator follow-up visits to unresponsive households. The persistence of the pandemic greatly complicated enumerators’ efforts to obtain data in person during a time of social distancing, slowing down the count. Unusual residential patterns caused by the pandemic, such as college students staying at home instead of going to campuses in another state, compounded the challenge for obtaining accurate census results. “Such results can be ‘make or break’ in some states,” Lowenthal notes. “Alabama was on the cusp of losing a House seat and half the students at the University of Alabama are from out of state. Parents might have counted college kids at home once COVID closed campuses, but they are supposed to be counted where they attend school. Alabama worked with the Bureau to make sure students were counted at their college addresses. NARFE MAGAZINE www.NARFE.org

In the end, Alabama retained its seventh congressional seat.” Many called for enumeration activities to be extended to allow more collection of data. But in August, the Census Bureau announced that enumeration activities would cease at the end of September, rather than the previously planned deadline of October 30. A court challenge ensued and, ultimately, the census was ended such that paper responses postmarked on or before October 15 were processed as long as they arrived at the processing center by October 22. Jared Hautamaki, a U.S. Environmental Protection Agency attorney, and his wife were enumerators near his home in Montgomery County as well as in Baltimore County, both in Maryland. “I absolutely have concerns about the accuracy of the 2020 census,” Hautamaki says. “They cut off our enumeration work when it appeared there was plenty of work left to be done in some areas. Some days the response rate was as low as 10 percent. Restricted apartment complexes were particularly challenging. Some people didn’t want to respond due to COVID-19 issues, others due to the citizenship question issue.”

The Question of Accuracy When releasing the April results, the Census Bureau championed the data’s accuracy. “Despite all the challenges of the pandemic, the completeness and accuracy of these first 2020 census results are comparable with recent censuses,” said Census Bureau Acting Director Ron Jarmin. “We had numerous quality checks built into collecting the data, and we have conducted one of the most comprehensive reviews in recent census history during data processing. We are confident that today’s 2020 census results meet our high data quality standards.” The Census Bureau simultaneously released preliminary information about the quality of the 2020 census. A report from the department analyzes the differences between the latest census counts and each of the benchmarks. The analyses show that these first results from the 2020 census are in line with the three sets of benchmarks, the Bureau reported.

NARFE MAGAZINE AUGUST 2021

But several sources noted that high response rates at a national level may not necessarily correlate with accuracy locally. “Census accuracy at the national level can mask large numbers of people who are missed and large numbers who are counted twice, which cancel each other out,” Lowenthal says. “That may make a census look successful, but the people who are more likely to be missed are people of color, poorer households and young children, and those counting mistakes don’t offset each other at the local level.”

KEY RESULTS FROM THE 2020 CENSUS RELEASED APRIL 26, 2021: # The resident population of the United States on April 1, 2020, was 331,449,281. # The U.S. resident population represents the total number of people living in the 50 states and the District of Columbia. The resident population increased by 22,703,743, or 7.4 percent, from 308,745,538 in 2010. # The most populous state was California (39,538,223); the least populous was Wyoming (576,851). # The state that gained the most people since the 2010 census was Texas (up 3,999,944 to 29,145,505). # The fastest-growing state since the 2010 census was Utah (up 18.4 percent to 3,271,616). # Puerto Rico’s resident population was 3,285,874, down 11.8 percent from 3,725,789 in the 2010 census. Source: U.S. Census Bureau

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An additional measure of accuracy will come when the Census Bureau releases the proportion of 2020 census data calculated indirectly through imputation, says Andrew Reamer, a research professor at the George Washington Institute of Public Policy, a unit of George Washington University. “If there is a higher percentage of some areas in some states being counted indirectly compared to past censuses, that would suggest that the results could be less accurate compared to past decennial censuses,” notes Reamer. An April 2021 analysis by demographers William P. O’Hare and Jae June Lee in their working paper, “Who Responded in the 2020 Census? Variation in Tract-Level Self-Response Rates in the 2020 U.S. Census,” found a high correlation between the 2010 census and 2020 census self-response rates for census tracts, large counties, large cities and states, a positive indicator for the relative accuracy of the 2020 census. However, the authors also considered it likely “that historical patterns of unequal coverage in the census are continuing,” including among certain minority groups and people with lower income and/or education.

Threats to Privacy Advances in information technology since the 2010 census have created new complications for the 2020 census. A core obligation of the census is to ensure that information collected remains private and is not divulged to third parties. But the emergence in recent years of commercially available demographic datasets and advanced analytical tools means that organizations and other entities can increasingly reverse-engineer information collected from the census, which is broken down all the way to the local level and individual levels, to figure out the identity of individuals and where they live. Such data could further existing trends of political parties and retailers using such data to target advertising and messages to influence

NARFE MAGAZINE AUGUST 2021

individuals’ behavior, and, potentially, criminals using it to exploit and harm participants. In 2020, the Census Bureau responded to these threats by announcing it intends to use a new algorithm, called differential privacy, to make 2020 respondent data more difficult to reverse-engineer by third parties by introducing slight inaccuracies in datasets to conceal respondent-specific data. Thus, instead of indicating that there are 1,000 respondents in one neighborhood, the addition of “noise” to the data might indicate that there are 1,050. Some have criticized the approach. “My work deals with the estimation of population-level rates of incidence and prevalence of diseases and mortality with emphasis in racial/ethnic differences,” says Alexis Santos, a Pennsylvania State University professor who uses Census Bureau data for his research. “I oppose the implementation of [differential privacy] as long as it keeps producing error rates as high as those I’m observing in my research.” “Well-intentioned civil servants are making decisions with enormous implications by themselves and without sufficient congressional oversight,” Reamer says. “Ideally, there should be a publicly transparent process by which the Census Bureau makes its noise allocation decisions.”

New Leadership On April 13, President Biden announced his intent to appoint Robert Santos, vice president and chief methodologist at the Urban Institute in DC and the 116th President of the American Statistical Association (ASA), as Census Bureau director. If confirmed by the Senate, Santos would be the first person of color to serve as permanent director of the Census Bureau. In a statement to NPR, Santos vowed that, if selected, he would support “the principles of transparency, scientific independence and integrity.” —DAVID TOBENKIN IS A FREELANCE WRITER IN THE GREATER WASHINGTON, DC, AREA.

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The Federal Family

NARFE’s Federal Family Resource

ARFE represents the entire federal community and is your source for information as you carry out advocacy

efforts during NARFE Grassroots Advocacy Month and throughout the year. The Federal Family table on the next page offers data on current and retired Feds and provides a synopsis of demographic trends, such as increases or decreases in the number of employees and annuitants since the previous fiscal year. This information is sourced from the Office of Personnel Management (OPM) and the U.S. Postal Service (USPS). The chart includes the total number of annuitants in fiscal year 2020, which is then further categorized into employee annuitants and survivor annuitants. Since the last fiscal year, the number of annuitants increased overall, though the number of survivor annuitants decreased. In addition, pensions provided to annuitants, as well as the overall number of federal employees and postal employees, increased over the previous year. Though there are fluctuations in the number of federal employees and annuitants every year, the federal community continues to have a strong presence in every congressional district throughout the country. Please

NARFE MAGAZINE AUGUST 2021

MEAN (AVERAGE) AND MEDIAN (MIDPOINT) MONTHLY ANNUITIES BY SYSTEM BY YEAR CSRS 2020 FERS 2020 CSRS 2019 FERS 2019 CSRS 2018 FERS 2018 EMPLOYEE MEAN* $4,055 $1,639 $3,939 $1,576 $3,781 $1,506 EMPLOYEE MEDIAN $3,532 $1,304 $3,428 $1,247 $3,288 $1,183 SURVIVOR MEAN** $1,758 $645 $1,710 $620 $1,646 $596 SURVIVOR MEDIAN $1,553 $501 $1,514 $483 $1,459 $466 * Employee Annuitants

** Survivor Annuitants

refer to this chart and to other educational materials from NARFE when you meet with your legislators during and after NARFE Grassroots Advocacy Month. Visit the NARFE advocacy webpage, www.narfe.org/ advocacy, to access statespecific federal family fact sheets and policy issue briefs. These documents list the number of federal retirees and employees in each state along with the departments and agencies they work for. They also compare the size of agencies to private-sector employers in each state.

Additionally, NARFE publishes fact sheets detailing the number of federal annuitants in each congressional district. Please use this invaluable information when communicating with your lawmakers, as it demonstrates the size and influence that the federal community has in each district and state. If you have any questions about the data here or any other resources provided by the advocacy department, please call 1-800-456-8410 and select option 3, or email us at advocacy@narfe.org. —BY SETH ICKES, GRASSROOTS ASSISTANT

The Federal Family

Federal Employees, Postal Employees and All Civilian Annuitants The chart is a snapshot in time of the federal family. Dates and sources of the data are listed below. Please note: federal and U.S. Postal Service (USPS) employee categories are based on place of employment, not residence. Use these numbers in communications with elected officials. (Note: Blue numbers denote annual decrease.) STATE/AREA

ALABAMA ALASKA ARIZONA ARKANSAS CALIFORNIA COLORADO CONNECTICUT DELAWARE DISTRICT OF COLUMBIA FLORIDA GEORGIA GUAM HAWAII IDAHO ILLINOIS INDIANA IOWA KANSAS KENTUCKY LOUISIANA MAINE MARYLAND MASSACHUSETTS MICHIGAN MINNESOTA MISSISSIPPI MISSOURI MONTANA NEBRASKA NEVADA NEW HAMPSHIRE NEW JERSEY NEW MEXICO NEW YORK NORTH CAROLINA NORTH DAKOTA OHIO OKLAHOMA OREGON PENNSYLVANIA PUERTO RICO RHODE ISLAND SOUTH CAROLINA SOUTH DAKOTA TENNESSEE TEXAS US VIRGIN ISLANDS UTAH VERMONT VIRGINIA WASHINGTON WEST VIRGINIA WISCONSIN WYOMING ABROAD & TERRITORIES

TOTAL

TOTAL ANNUITANTS*

EMPLOYEE ANNUITANTS*

SURVIVOR ANNUITANTS*

59,861 8,782 63,468 25,403 212,943 53,339 14,944 12,301 43,255 192,961 93,130 2,443 24,831 17,113 71,221 39,123 21,798 25,412 34,973 28,844 14,595 168,251 41,646 48,521 31,688 26,705 56,101 14,573 13,894 27,503 13,511 52,081 29,527 94,592 84,732 6,917 77,772 47,946 35,460 110,244 11,891 7,635 48,980 11,546 51,398 182,726 598 34,978 4,892 148,672 72,097 19,425 30,256 6,416 21,672

47,634 7,548 52,914 20,304 171,324 44,620 11,999 10,349 36,375 159,700 75,889 1,660 19,002 14,393 58,863 32,195 17,769 20,891 28,653 23,632 11,847 140,223 33,157 41,010 26,313 21,502 46,264 12,377 11,261 23,265 11,066 41,046 24,661 76,933 69,854 5,699 63,282 38,143 29,397 89,244 9,591 5,973 39,841 9,736 42,131 147,871 486 28,314 4,049 122,726 59,539 16,264 25,212 5,498 12,841

12,227 1,234 10,554 5,099 41,619 8,719 2,945 1,952 6,880 33,261 17,241 783 5,829 2,720 12,358 6,928 4,029 4,521 6,320 5,212 2,748 28,028 8,489 7,511 5,375 5,203 9,837 2,196 2,633 4,238 2,445 11,035 4,866 17,659 14,878 1,218 14,490 9,803 6,063 21,000 2,300 1,662 9,139 1,810 9,267 34,855 112 6,664 843 25,946 12,558 3,161 5,044 918 8,831

2,695,586

2,202,330

493,256

MONTHLY ANNUITIES

FEDERAL EMPLOYEES**

USPS EMPLOYEES***

$160,664 $23,296 $161,871 $56,117 $568,049 $148,683 $38,094 $39,377 $169,327 $525,514 $242,088 $4,537 $71,818 $43,120 $190,962 $93,815 $50,542 $62,822 $79,070 $70,863 $34,913 $655,289 $110,325 $122,185 $77,008 $63,701 $138,866 $36,817 $31,871 $71,279 $37,011 $152,869 $76,921 $231,253 $226,446 $15,380 $205,781 $114,047 $92,616 $290,532 $24,202 $19,594 $124,428 $26,608 $128,428 $463,614 $1,245 $91,129 $11,601 $524,486 $194,877 $49,399 $69,146 $15,417 $36,600

39,816 10,879 32,555 13,288 148,030 38,029 8,310 3,335 144,565 86,282 75,572 2,775 23,583 8,765 42,633 24,748 9,007 16,720 21,669 19,127 11,471 131,055 24,984 26,305 16,943 18,356 37,578 9,137 10,020 12,185 4,493 21,024 21,556 52,110 46,721 5,518 51,305 40,176 19,185 62,920 12,124 7,792 22,928 8,298 27,839 121,758 404 31,032 3,254 140,002 54,984 16,243 16,463 5,775 30,792

9,341 1,531 9,978 5,528 64,272 10,982 8,520 2,056 5,716 37,086 18,896 136 2,521 2,611 29,711 12,483 7,572 6,589 7,974 8,540 3,451 13,206 16,377 21,359 12,396 5,167 15,523 2,091 4,539 4,846 3,445 21,608 3,231 44,636 20,432 1,845 23,433 6,974 7,112 28,649 3,085 2,708 8,969 2,028 13,219 44,577 146 5,521 1,622 16,707 12,365 3,876 11,721 1,071 13

109,018 21,192 106,001 44,219 425,245 102,350 31,774 17,692 193,536 316,329 187,598 5,354 50,935 28,489 143,565 76,354 38,377 48,721 64,616 56,511 29,517 312,512 83,007 96,185 61,027 50,228 109,202 25,801 28,453 44,534 21,449 94,713 54,314 191,338 151,885 14,280 152,510 95,096 61,757 201,813 27,100 18,135 80,877 21,872 92,456 349,061 1,148 71,531 9,768 305,381 139,446 39,544 58,440 13,262 52,477

$7,366,513

2,171,915

639,991

5,507,492

(IN THOUSANDS)*

TOTAL

*OFFICE OF PERSONNEL MANAGEMENT, FISCAL YEAR 2020 **OFFICE OF PERSONNEL MANAGEMENT FEDSCOPE, DECEMBER 2020. (The locations of an additional 279,496 employees are suppressed for security reasons.) ***POSTAL REGULATORY COMMISSION, APRIL 2021

NARFE MAGAZINE www.NARFE.org

Managing Money

How to Convert Traditional TSP Money to a Roth IRA

s more Thrift Savings Plan (TSP) participants become aware of the potential benefits of a Roth conversion, I’m being asked many questions regarding how to

convert traditional TSP money. While I’ve written a number of Roth conversion columns for NARFE Magazine, they’ve mainly focused on the “why.” To address several prevalent questions on this topic, most of which relate to the mechanics of converting traditional TSP money to a Roth account, this month’s column will focus more on the “how.” The most common question is, “How do I convert my traditional TSP to the Roth TSP?” Unfortunately, at this time, the TSP doesn’t allow what’s known as an “in-plan” conversion—the process of converting money from a traditional tax-deferred account to a Roth account within an employer-sponsored retirement plan, such as the TSP. Therefore, the only way for TSP participants to convert traditional TSP money to a Roth account is to convert funds from the traditional TSP to a Roth IRA. This often leads to the follow-up query, “Do I need to transfer the traditional TSP money to a traditional IRA before converting to a Roth IRA?” The answer to this is simply, no. Both IRS rules and TSP withdrawal rules allow participants to transfer a withdrawal directly from the traditional TSP to a Roth IRA. The most efficient method for doing this is to instruct the TSP to transfer a withdrawal (known as a direct rollover) from the TSP to 42

NARFE MAGAZINE AUGUST 2021

a Roth IRA. The TSP withdrawal paperwork requires your Roth IRA custodian’s signature confirming that he or she accepts the transfer from the TSP. There’s no reason a custodian should

ONLY ELIGIBLE ROLLOVER DISTRIBUTIONS MAY BE MOVED FROM THE TSP TO ANOTHER RETIREMENT PLAN. refuse a direct transfer; if it does, it’s time to move your Roth IRA to a different custodian. An alternative to transferring the money directly from the TSP to a Roth IRA is an indirect rollover, which involves the TSP participant taking possession of a withdrawal paid directly to him or her (depositing the withdrawal into a personal bank account) and then moving the money into the Roth IRA.

When taking this approach, there are several rules to be aware of that make this approach less desirable. For instance, 60 days is the maximum time one may take to get the money deposited into the Roth IRA. Failure to meet this deadline will result in the TSP participant being stuck with a taxable withdrawal that may not be put back into any retirement plan. Furthermore, a single withdrawal paid directly to a TSP participant is subject to a mandatory 20 percent tax withholding. Participants may deposit the gross TSP withdrawal, including the 20 percent withholding, into the Roth IRA, but since the withholding went to the U.S. Treasury, the participant will have to come up with the money from another source. Finally, any amount from the TSP withdrawal not converted to the Roth IRA (or deposited into another retirement plan) may be subject to the 10 percent early distribution penalty if no exception applies. Bear in mind, only eligible rollover distributions may be moved from the TSP to another retirement plan. Many TSP participants ask if they may convert their required minimum distributions (RMDs) to a Roth IRA, and the answer is no. RMDs are not eligible rollover distributions, and, therefore, may not be converted to a Roth IRA. Some people wonder, Is my income too high for a Roth conversion?

BENEFITS RESOURCES NARFE OFFERS MEMBERS a wide range of information on federal benefits. Visit www.narfe.org/federal-benefits-institute.

There are two possible ways for getting money into a Roth IRA. The first is through an annual contribution, which not only requires eligible compensation (employment wages, selfemployment income, etc.), but is also subject to income limits. If income exceeds these limits, a Roth contribution is prohibited. The second method for getting money into a Roth IRA is through a Roth conversion, which doesn’t require eligible compensation and is not subject to any income limits. Anyone, regardless of how much income they have and the type of income it is, may carry out a Roth conversion. Another common question: Will I owe taxes on money converted from the traditional TSP to a Roth IRA?

Absolutely. For additional information on eligible rollover distributions, taxation, and the logistics of converting the traditional TSP to a Roth IRA, check out TSP publications TSP-536 - “Important Tax Information About Payments From Your TSP Account” and TSPBK02 - “Withdrawing From Your TSP Account for Separated and Beneficiary Participants.” Also see IRS Publication 590 A - “Contributions to Individual Retirement Arrangements (IRAs)” and IRS Publication 721 - “Tax Guide to U.S. Civil Service Retirement Benefits.” 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.

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2020_02_NARFE_Apr_HHoriz.indd 1

2/12/20 NARFE MAGAZINE www.NARFE.org

9:51 AM

For the Record

A MIXED ECONOMIC BAG AS JOB GROWTH LAGS, INFLATION RISES

THRIFT SAVINGS PLAN FUND RETURNS 2021

G FUND

2021

C FUND

S FUND

I FUND

JUNE

0.12%

0.74%

2.33%

3.46%

-1.44%

MAY

0.13%

0.34%

0.69%

-0.66%

3.61%

APRIL

0.13%

0.82%

5.33%

4.23%

3.09%

YTD

0.65%

-1.49%

15.24%

15.47%

8.99%

Investors pondered mixed economic signals, including accelerating job creation that still lagged many economists’ expectations. Inflation reached its highest level since 2008, an increase some observers dismissed as transitory. The Federal Reserve left its target short-term interest rate unchanged, citing the ongoing impact of the coronavirus pandemic. The C and S Funds both rose. The I Fund posted a loss as a stronger U.S. dollar negated positive returns in foreign markets. A decrease in longerterm interest rates contributed to a gain for the F Fund. All L Funds finished higher. —BY MICHAEL JERUE, FINANCIAL

1 YEAR

1.02%

-0.18%

40.77%

61.70%

32.58%

3 YEAR*

1.79%

5.40%

18.63%

18.53%

8.61%

5 YEAR*

1.99%

3.14%

17.61%

18.81%

10.64%

10 YEAR*

1.96%

3.63%

14.86%

14.17%

6.24%

ANALYST, THRIFT SAVINGS PLAN RETURNS are net of the effect of accrued administrative expenses and investment expenses/costs. Source: TSP

L INCOME

2021

F FUND

L 2025

L 2030

L 2035

L 2040

JUNE

0.39%

0.64%

0.79%

0.86%

0.92%

MAY

0.47%

0.81%

1.00%

1.08%

1.16%

APRIL

1.14%

2.15%

2.74%

2.99%

3.24%

YTD

3.28%

6.29%

7.91%

8.63%

9.36%

1 YEAR

8.86%

N/A

23.52%

N/A

28.43%

3 YEAR*

5.12%

N/A

10.30%

N/A

11.86%

5 YEAR*

4.99%

N/A

10.41%

N/A

11.96%

10 YEAR*

4.34%

N/A

8.66%

N/A

9.75%

L 2045

L 2050

L 2055

L 2060

L 2065

JUNE

0.98%

1.03%

1.17%

MAY

1.22%

1.28%

1.50%

APRIL

3.45%

3.66%

4.35%

YTD

9.98%

10.62%

13.00%

1 YEAR

N/A

32.85%

N/A

3 YEAR*

N/A

13.17%

N/A

5 YEAR*

N/A

13.32%

N/A

10 YEAR*

N/A

10.65%

N/A

*ANNUALIZED.

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.)

COUNTDOWN TO COLA The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) increased 0.91 percent in May 2021. To calculate the 2022 cost-of-living adjustment (COLA), the 2021 third-quarter indices will be averaged and compared with the 2020 third-quarter average of 253.412. The percentage increase determines the COLA. Mays index, 263.12, is up 4.03 percent from the base. The CPI represents purchases of food and beverages, housing, apparel, transportation, medical care, recreation, education and communication, and other goods and services. For FECA COLA updates, visit narfe.org and search for FECA.

OPM RETIREMENT CLAIMS PROCESSING STATUS

2021

2020

Claims Received

MONTH

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

MAY 6,648 18,177 JUNE 6,555 17,432 JULY 6,819 17,631 AUGUST 6,775 18,570 SEPTEMBER 6,244 18,274 OCTOBER 8,323 19.605 NOVEMBER 5,876 20,022 DECEMBER 5,135 19,687 JANUARY 13,850 26,968 FEBRUARY 7,495 26,460 MARCH 9.664 27,638 APRIL 9,414 25,386 MAY 7,684 24,619

83 81 95 73 73 77 74 74 85 77 69 71 70

64 65 68 68 69 77 76 75 78 78 76 75 74

FOR THE NUMBER of new retirement cases the Office of Personnel Management (OPM) receives each month by agency and the percent with errors that it returns to those agencies, go to www.opm.gov/retirement-services/. l Source: OPM 44

NARFE MAGAZINE AUGUST 2021

CPI-W

Monthly % Change

% Change from 253.412

OCTOBER 2020

254.076

0.03

0.26

NOVEMBER

253.826

-0.10

0.16

DECEMBER

254.081

0.10

0.26

JANUARY 2021

255.296

0.48

0.74

FEBRUARY

256.843

0.61

1.35

MARCH

258.935

0.81

2.20

APRIL

261.237

0.89

3.08

MAY

263.612

0.91

4.03

JUNE JULY AUGUST SEPTEMBER

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Support Alzheimer’s Research NARFE members contributed for Alzheimer’s research: $14 Million Fund

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

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NARFE News DELIVERY PROBLEMS?

NARFE Photo Contest Winners

ARFE’s 2022 Photo Contest brought in scores of wonderful photographs from NARFE members across America. Thank you all for sharing your work.

Narrowing the selection from so many excellent photos down to 12 was particularly challenging this year, but the result is a magnificent 2022 NARFE Calendar, which will be

If you missed an issue of NARFE Magazine, please contact our communications department at communications@narfe. org or call us toll free at 1-800-456-8410 and ask for communications. We will send out a replacement issue at no charge to you.

distributed during the NARFE fundraising effort this month. Here are the winning photographers and the titles of their photos. Congratulations to everyone.

LIST OF 2021 WINNERS January: “Mather Point, South Rim, Grand Canyon, AZ” by Linda Granzow, Mesa, AZ, National-Only member. February: “Taking Flight” by Michael Bryant, Tucson, AZ, Chapter 0055. March: “A Blush of Pink” by Linda Suchocki, Buffalo, NY, Chapter 0439. April: “Greetings From Brooks Falls, Katmai National Park, AK, Where the Fishing Is Great” by Dennis Umshler, Albuquerque, NM, Chapter 0080. May: “Sunset at the Former Mare Island Naval Shipyard Vallejo, CA” by William George, Fairfield, CA, Chapter 1529. June: “Cucumber Falls, Ohiopyle State Park, PA” by Chris Cheberenchick, Pittsburgh, PA, National-Only member. July (and Cover): “Lady Liberty” by Edward Mutchnick, Lindenhurst, NY, Chapter 1264. August: “Cumbres and Toltec Railroad” by Jordan Tuller, The Villages, FL, Chapter 1372. September: “Sunset Atop the Vessel, Hudson Yards, New York City” by Tom Carroll, Davidson, NC, Chapter 0105. October: “Quiet Afternoon” by Carol Driver, Glenwood, MD, National-Only member. November: “False Kiva” by Don Hutter, Ormond Beach, FL, NationalOnly member. December: “Iceman” by Phyllis Maguire, Burke, VA, Chapter 0893.

NARFE MAGAZINE AUGUST 2021

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

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 NARFE?

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

• Visit the Legislative Action Center to contact your representatives about bills affecting federal benefits. • Get NARFE Magazine with news and insights for the federal community. • Save time, hassle and money with NARFE Perks. • The opportunity to get involved at the local level by joining a chapter in your area. 1Q6

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NARFE News

If We Can’t Reach You, You’re Missing Out— Update Your Member Profile Today

s a NARFE member, you have access to a large and ever-growing list of great resources. NARFE Magazine and our weekly e-newsletter, NewsLine, are your best sources for news and information on issues that affect federal employees and retirees, and the magazine consistently ranks as our No. 1 member benefit. You also have exclusive access to educational webinars that help you take full advantage of your federal benefits, as well as members-only discounts on appliances, travel, entertainment and more through our NARFE Perks program. Plus, we’re launching great new member resources in the coming months. We deliver all this content via mail and email, but if we don’t have your current mailing address, email address and other contact information, you could be missing out. Don’t worry, though—it’s easy

to update your NARFE member profile online. Start by going to www.narfe.org and clicking on “Log In,” located at the upper right corner of the webpage. This will take you to our member portal, where you’ll need to click “Login,” again at the upper right. Click “Member” at the next screen, enter your username and password, and click “Sign In.” If you don’t have your username or password, you can either click the button on the screen to get help, or you can email us at loginhelp@ narfe.org. Once you’ve logged in, you’re almost there. On the member portal welcome page, click on the “Profile” icon to see your member profile and review your current contact information. To make changes, click the “Update Contact Information” button and make any necessary updates. If you don’t have an email address on

file with us, please add one so that you can receive NewsLine, as well as notifications about upcoming webinars, new online services and more. Also, if you joined NARFE as an active federal employee and have since retired, please update your record under “My Member Type.” When you’ve completed your edits, click “Save,” and you’ll be taken back to your profile page where you can review the changes. Not comfortable updating your record online? No problem. Just call 800-456-8410, then press 1 for membership, and our member services team will be happy to help you make changes to your profile. Keep in mind that mailing address updates can take up to 45 days to take effect. By staying connected and informed, you’ll always get the most out of your NARFE membership.

—BY DAVE BOWMAN, SENIOR DIRECTOR, MEMBERSHIP DEVELOPMENT

As NARFE commemorates its centennial, NARFE Magazine is providing a look back at milestones for the organization and its work on behalf of federal civilian employees, retirees and their survivors. Cost-of-living adjustments (COLAs) for federal annuitants are based on the rate of inflation as measured by the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), but that wasn’t always the case. Congress passed the first law requiring automatic COLAs for federal civil service retirement benefits in 1962. Prior to that legislation, Congress had only provided occasional annuity increases. Over the next few years, NARFE backed revisions to the formula, which in turn provided the foundation not only for civil service COLAs today but also for similar adjustments in many federal programs, including the Social Security COLA. Visit narfe.org/centennial for more about NARFE’s century of service. Eargo and GEHA are proud sponsors of NARFE’s Centennial.

NARFE MAGAZINE AUGUST 2021

NARFE’s August Webinars— Dealing with Big Changes As an active or retired federal employee, divorce and retirement are major life events that have a unique impact on you and your benefits. NARFE can help you face the big challenges and take advantage of your opportunities. Join us for these powerful

webinars and come out ahead.

NEW!

UPCOMING WEBINARS: THURSDAY, AUGUST 12, 2 P.M. ET

Protecting Your Federal Benefits in Divorce

THURSDAY, AUGUST 26, 2 P.M. ET

Jessica Markham, JD Mark Keen, CFP Financial planner helping Attorney at Law and federal divorce expert Feds prepare for retirement

Pre-Retirement Tax Issues

Online Q&A sessions follow each webinar. For details and to register, visit NARFE.org/Institute. Questions? Members can call 800-456-8410 x2 or email NARFE’s federal benefits specialists for one-on-one help fedbenefits@narfe.org. Not a member? Join NARFE today at NARFE.org/Join.

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• • •

Special Section

Consolidated Financial Statements for the Year Ended December 31, 2020 REPORT OF THE NATIONAL SECRETARY/TREASURER The annual financial audit was performed by the firm selected by NARFE’S Audit Committee. NARFE’s annual financial reporting is shown as a Consolidated Statement of Accounts in accordance with AICPA standards. All accounts—investment accounts, general operating and capital accounts, and NARFE-PAC funds are consolidated for one summary report. NARFE has ended fiscal year 2020 with a surplus in general operating funds. NARFE policy on investments only in equities and bonds remains very conservative. The NARFE investment portfolio is well managed by Morgan Stanley with oversight by NARFE’s secretary/treasurer and final decisions by the National Executive Board (NEB). We ended 2020 with an increase in investment earnings. Fiscal year 2020 was a different year. Like every other business, our financial operations were affected by the pandemic. Many normal costly events handled in the past were curtailed, resulting in overall savings. From oversight by the Budget and Finance Committee to more emphasis on accountability by the NEB, we are adjusting to a new normal. The Configuration Advisory Board (CAB) charter was updated, and they instituted a new tracking system for improved monitoring of our new data management system (AMS). AMS should be fully implemented in 2021 as we deal with some quirks that affect not only Headquarters accounting but also the verification of reports for the field organizations. As we determine further improvements to the accountability of NARFE operations, we are aware of the human elements—our staff and our members—to whom we owe our gratitude for their dedication and assistance. A special thank you to Region VII Vice President Rodney Adelman for his persistence as he urged for better controls and documentation in his extra roles as the NEB’s chair of the Audit Committee and compliance officer for the past five years. He has provided outstanding service to NARFE. —Kathryn E. Hensley

REPORT OF THE NATIONAL EXECUTIVE BOARD AUDIT COMMITTEE The National Executive Board (NEB) Audit Committee held a videoconference on April 5 with our auditors, Marcum LLP, first with the NARFE National Officers and staff and then privately, to review the draft audit of NARFE’s financial statements for the year ended December 31, 2020. National Audit Committee members participating were Region VII Vice President Rodney Adelman (Chair), Region II Vice President Gary Roundtree Sr., and Region IX Vice President Linda Silverio. The auditors provided a comprehensive review of NARFE’s Consolidated Financial Statements and their Governance Letter. The auditors reported finding no material weaknesses in internal controls and have provided an unqualified opinion on our financial statements, a “clean” audit. Of note, the 2020 audit was done entirely remotely due to Covid-19 precautions. The audit confirmed a $1,432,726 gain in net assets, primarily due to investment income of $1,185,039 and a reduction in expenses of $1,465,209. However, membership loss continues to be a concern. Pursuant to the Audit Committee’s recommendation, the NEB unanimously voted on April 23 to accept the audit. Based on the results of the audit, the Committee commends NARFE senior management and staff for their contributions to qualitative financial reporting. After having served as the National Audit Committee Chair for the last five audit cycles and as the NARFE Compliance Officer since the position’s inception in late 2016, I have decided to step down from these positions. It is time for some “new blood” and a different perspective. It has been a pleasure to serve. —Rodney L. Adelman, Chair

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Independent Auditors’ Report To the National Executive Board of National Active and Retired Federal Employees Association and Affiliate Report on the Financial Statements We have audited the accompanying consolidated financial statements of National Active and Retired Federal Employees Association and Affiliate (collectively referred to as the Association), which comprise the consolidated statement of financial position as of December 31, 2020, and the related consolidated statements of activities, functional expenses and cash flows for the year then ended, and the related notes to the consolidated financial statements. Management’s Responsibility for the 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 consolidated financial statements. The procedures selected depend on the auditors’ judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the consolidated 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 consolidated 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 2020 consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of National Active and Retired Federal Employees Association and Affiliate as of December 31, 2020, 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. Other Matters Report on Summarized Comparative Information We have previously audited the Association’s 2019 consolidated financial statements, and in our report dated March 20, 2020, we expressed an unmodified opinion on those statements. In our opinion, the summarized comparative information presented herein as of and for the year ended December 31, 2019, is consistent, in all material respects, with the audited consolidated financial statements from which it has been derived. Report on Supplementary Information Our audit was conducted for the purpose of forming an opinion on the consolidated financial statements as a whole. The consolidating supplementary information is presented for purposes of additional analysis of the consolidated financial statements, and is not a required part of the consolidated financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the consolidated financial statements. The consolidating information has been subjected to the auditing procedures applied in the audit of the consolidated financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the consolidated financial statements or to the consolidated financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the consolidating information is fairly stated, in all material respects, in relation to the consolidated financial statements as a whole. Marcum LLP Washington, DC April 21, 2021

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National Active and Retired Federal Employees Association and Affiliate Consolidated Statement of Financial Position December 31, 2020 (With Summarized Financial Information for the Year Ended December 31, 2019)

National Active and Retired Federal Employees Association and Affiliate Consolidated Statement of Financial Position December 31, 2017 (With Comparative Totals as of December 31, 2016 and 2015)

Additional NARFE Financial Data

The salaries of the National Executive Board, as of December 31, 2020, are as follows (rounded): President: $128,067 Secretary/Treasurer: $114,544 Regional Vice Presidents: $27,750

In 2020, NARFE’s investments were held with these firms: • Operating Fund: Morgan Stanley and The Vanguard Group • Life Membership Trust Fund: Morgan Stanley • Contingency Fund: Morgan Stanley • PAC Fund: Raymond James

The accompanying notes are an integral part of these consolidated financial statements.

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National Active and Retired Federal Employees Association and Affiliate Consolidated Statement of Activities for the Year Ended December 31, 2020 (With Comparative Totals for the Year Ended December 31, 2019)

NARFE MAGAZINE AUGUST 2021

National Active and Retired Federal Employees Association and Affiliate Consolidated Statement of Functional Expenses for the Year Ended December 31, 2020 (With Comparative Totals for the Year Ended December 31, 2019)

NATIONAL ACTIVE AND RETIRED FED EMPLOYEES ASSOCIATION AND AFFIL

CONSOLIDATED STATEMENT OF FUNCTIONA For the Year Ended December 31, 2019 (With Summarized Financial Information for the Year Ende _______________ Program Services

Communications Salaries and benefits Printing and postage Contract services Political contributions Advertising Office expenses Meetings and conferences Professional fees Bank fees and taxes Depreciation TOTAL EXPENSES

444,239 1,112,571 244,320 7,958 4,226 11,790 -

704,102 10,044 561,193 15,242 -

103,515 8,454 616,000 22,147 17,702 674 29,876 -

1,825,104

1,290,581

798,368

Political Action Committee

Membership Services

Total Program Services

Conferences and meetings

699,634 $ 228,046 $ 108,282 $ 2,184,3 46,491 9 1,001 1,273,6 26,528 9,997 850,4 NATIONAL ACTIVE AND RETIRED FED 616,0 EMPLOYEES ASSOCIATION AND AFFIL20,976 6,487 15,484 88,2 OF FUNCTIONA 9,732 CONSOLIDATED 4,302 STATEMENT 155,502 191,4 For the Year Ended December 31,224,4 2019 113,304 96,529 2,188 (With Information- for the Year Ende - Summarized Financial 29,8 _______________ -

Program Services $ 890,137

Political Action Committee

Membership Services

Federal benefits program

Legislative program

361,901 Federal benefits program

Legislative program

292,454

5,458,5

Total Program Services

Conferences and meetings

444,239 1,112,571 244,320 7,958 4,226 11,790 -

704,102 10,044 561,193 15,242 -

103,515 8,454 616,000 22,147 17,702 674 29,876 -

699,634 46,491 20,976 9,732 113,304 -

228,046 9 26,528 6,487 4,302 96,529 -

108,282 1,001 9,997 15,484 155,502 2,188 -

2,184,3 1,273,6 850,4 616,0 88,2 191,4 224,4 29,8 -

1,825,104

1,290,581

798,368

890,137

361,901

292,454

5,458,5

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National Active and Retired Federal Employees Association and Affiliate Consolidated Statement of Cash Flows for the Year Ended December 31, 2020 (With Comparative Totals for the Year Ended December 31, 2019)

National Active and Retired Federal Employees Association and Affiliate Notes to Consolidated Financial Statements December 31, 2020 NOTE 1: NATURE OF ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization: National Active and Retired Federal Employees Association (NARFE) was established in 1921 to advance the general welfare of its 160,000-plus members and to aid them in securing their rights under federal retirement laws. NARFE is incorporated under the laws of District of Columbia. Its programs include legislative,

NARFE MAGAZINE AUGUST 2021

federal benefits, communications and conferences. These activities are primarily funded by membership dues and contributions and revenue derived from advertising. There are fifty-four (54) federations, located in the United States, District of Columbia, Panama, Puerto Rico, and the Philippines, that are affiliated with NARFE and conduct local independent programs. Ten percent of all eligible member national dues collected are passed- through to these federations

to facilitate local activities. In addition, there are 872 chapters affiliated with NARFE that are located in the United States and some international locations. The chapters are established by members to increase the scope and effectiveness of NARFE. Chapter dues are established by the chapters and are billed and collected by NARFE with the national dues. NARFE rebates to the chapters one-third of the national fee charged for all new members joining chapters.

The federations and chapters are independent and autonomous organizations. As NARFE has no economic interest in or control of federations and chapters affiliates, their financial activities are not included in the accompanying consolidated financial statements of NARFE. The federations’ bylaws must adhere to NARFE’s bylaws. NARFE has created a political action committee called NARFE PAC.

Basis of Accounting: These consolidated financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America (GAAP). Consequently, revenue is recognized when earned and expenses are recognized when incurred. Principles of Consolidation: The consolidated financial statements of the Association have been prepared on the accrual basis of accounting and include the accounts of NARFE and its affiliate, NARFE PAC (collectively referred to as the Association). All material intercompany balances and transactions have been eliminated in consolidation. Cash and Cash Equivalents: Cash and cash equivalents are composed of demand deposits and money market funds. Accounts Receivables: The Association uses the allowance method to record accounts receivable at their estimated net realizable value. The allowance for doubtful accounts is based on various factors, including management’s analysis of the collectibility of the accounts, historical write-off of expenses and current economic conditions. A provision for doubtful accounts is made when collection of the full amount is no longer probable. Investments: Investments consist of mutual funds, corporate bonds and certificate of deposit. Investments are recorded in the accompanying consolidated financial statements at their fair value. Fair value is the price that would be received to sell an asset or paid to transfer a liability through an orderly transaction between market participants at the measurement date. Purchases and sales are reflected on a trade-date basis. Interest, dividends and realized gains or losses are recorded when earned. Changes in the

fair value of the portfolio are recorded as unrealized gains or losses.

Fair Value of Financial Instruments: In accordance with the accounting standards for fair value measurement for those assets and liabilities that are measured at fair value on a recurring basis, the Association has categorized its applicable assets and liabilities measured at fair value into a required fair value hierarchy. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level-input that is significant to the fair value measurement of the instrument. Applicable financial assets and liabilities are categorized on the basis of the inputs to the valuation techniques as follows: Level 1 – Financial assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market that the client has the ability to access. Level 2 – Financial assets and liabilities whose values are based on quoted prices in markets that are not active or model inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability. Level 3 – Financial assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. As of and for the year ended December 31, 2020, only the Association’s investments, as described in Note 2 to these consolidated financial statements, were measured at fair value on a recurring basis. Property and Equipment: All acquisitions of property and equipment greater than $1,500 and an economic life in excess of one year are capitalized at cost. Depreciation and amortization is computed by using the straight-line method based upon the estimated useful lives of the assets. Building and improvements are recorded at cost and depreciated using the straight-line method over their estimated useful lives of 20 to 40 years. Furniture, equipment and software are recorded

at cost and depreciated using the straight-line method over their estimated useful lives of three to eight years. Expenditures for major repairs and improvements that extend the useful life of an asset are capitalized, whereas expenditures for minor repairs and maintenance costs are expensed when incurred. The cost of property and equipment retired or disposed of is removed from the accounts along with the related accumulated depreciation, and any gain or loss is reflected in revenue and support or expenses in the accompanying consolidated statement of activities.

Classification of Net Assets: NARFE’s net assets are reported as follows: • Net assets without donor restrictions represent the portion of expendable funds that are available for any purpose in performing the primary objectives of the Association at the discretion of the Association’s management and the National Executive Board (the Board). From time to time, the Board designates a portion of these net assets for specific purposes, which makes them unavailable for use at management’s discretion. The Board has designated $2,000,000 of net assets without donor restrictions to serve as a working capital reserve to secure the Association’s long-term financial viability. Also included in board-designated net assets is the life membership fund in the amount of $1,375,761. • Net assets with donor restrictions represent funds that are specifically restricted by donors for use in various programs and/or for specific periods of time. These donor restrictions can be temporary in nature in that they will be met by actions of the Association or by the passage of time. Other donor restrictions are perpetual in nature, whereby the donor has stipulated that the funds be maintained in perpetuity. As of December 31, 2020, the Association had no net assets with donor restrictions that are required to be maintained in perpetuity. Revenue Recognition Membership Dues: Membership dues are on an anniversary-date basis and are recognized ratably over the membership period since there are no distinct performance obligations and the general member benefits are considered a bundled group of performance obligations that are delivered to members throughout the membership period.

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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 life expectancy tables. Accordingly, dues paid by members in advance of the reporting period to which the dues pertain are reported as deferred revenue in the accompanying consolidated statement of financial position. Contributions: Unconditional contributions received are recorded as revenue with or without donor restrictions, depending on the existence and/or nature of any donor stipulations. Donor restricted contributions are reported as an increase in net assets with donor restrictions, depending on the nature of the stipulation. When a restriction expires (that is, when a stipulated time restriction ends or purpose of a restriction is accomplished), net assets with donor restrictions are reclassified to net assets without donor restrictions and reported in the accompanying statements of activities as net assets released from restrictions. Investment Income: Realized and unrealized gains and losses and investment income (loss) derived from investment transactions are included as income in the year earned.

Advertising: Advertising revenue is recognized based upon when the advertisements are published, which is consistent with when the performance obligation is satisfied. Revenue from these activities received in advance of the period to which the revenue pertains is reported as deferred revenue in the accompanying consolidated statement of financial position.

and Equipment, the Association reviews its property for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. If the fair value is less than the carrying amount of the asset, an impairment loss is recognized for the difference. As of December 31, 2020, the Association has not recognized an impairment loss.

Royalties: The Association receives various royalties from other organizations. These royalties are primarily from membership benefits offered to members of the Association. The revenue is recognized when earned according to contractual agreements with each organization.

Functional Allocation of Expenses: The costs of providing the various programs and other activities have been summarized on a functional basis in the accompanying statement of functional expenses. Expenses directly attributed to a specific functional area of the Association are reported as expenses of those functional areas and are charged directly to the programs those items support. Shared costs such as office expenses are allocated to the functional area and the programs pro rata based on estimated time and efforts by employees.

Conferences and meetings: Conferences and meetings revenue consists of registrations, event sales and sponsorship fees and is recognized in the year in which the conference takes place. Revenue from these activities received in advance of the meeting is reported as deferred revenue in the accompanying consolidated statement of financial position.

Impairment of Long-Lived Assets: In accordance with the provisions of Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 360, Property, Plant

Estimates: The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.

NOTE 2: INVESTMENTS AND FAIR VALUE MEASUREMENTS

The following table summarizes the Association’s assets measured at fair value on a recurring basis, aggregated by type and fair value hierarchy level within which those measurements were made:

For the year ended December 31, 2020, the Association used the following methods and significant assumptions to estimate fair value for investments recorded at fair value: Mutual funds and exchange-traded funds – Value of these funds is based on quoted market prices in active markets. Certificate of deposit and corporate bonds – Valued at fair value by discounting the related cash flows based on current yields of similar instruments with comparable characteristics.

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NOTE 3: PROPERTY AND EQUIPMENT AND RELATED DEPRECIATION

The Association held the following property and equipment as of December 31, 2020:

Depreciation and amortization expense was $191,677 for the year ended December 31, 2020.

NOTE 4: NET ASSETS

Net Assets Without Donor Restrictions As of December 31, 2020, the Association’s net assets without donor restrictions were composed of the following:

Net Assets With Donor Restrictions As of December 31, 2020, net assets with donor restrictions were available for the following purposes:

NOTE 5: REVENUE FROM CONTRACTS WITH CUSTOMERS

The following table provides information about significant changes in the Association’s deferred membership revenue for the year ended December 31, 2020:

NOTE 6: CONCENTRATION OF CREDIT RISK

The Association maintains its cash and cash equivalents with a certain commercial financial institution, which aggregate balance, at times, may exceed the Federal Deposit Insurance Corporation (FDIC) insured limit of $250,000 per depositor per institution. As of December 31, 2020, the amount in excess of the maximum limit insured by the FDIC was approximately $794,000. The Association monitors the creditworthiness of this institution and has not experienced any credit losses on its cash and cash equivalents.

NOTE 7: LINE OF CREDIT

In June 2019, the Association obtained a line of credit with available borrowings of up to $500,000. The interest rate was 3.75% as of December 31, 2020. The interest rate is based on the Bank prime rate plus 0.5%. The line of credit is secured by investments and will mature in June 2021. The outstanding balance at December 31, 2020 was $300,000.

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NOTE 8: AVAILABILITY AND LIQUIDITY

NOTE 11: INCOME TAXES

investments are available to meet current cash flow needs. To help manage unanticipated liquidity needs, the Association has a committed line of credit of $500,000.

NOTE 12: – PRIOR YEAR SUMMARIZED FINANCIAL INFORMATION

The Association is exempt from federal income taxes under Section 501(c)(5) of the Internal Revenue Code (IRC). However, income from certain activities not directly related to the Association’s tax-exempt purpose is subject to taxation as unrelated business income. The Association generates unrelated business income from advertising. The Association’s provision for unrelated business income tax expense was approximately $15,000 for the year ended Cash and Cash Equivalents $ 1,619,803 December 31, 2020. Accounts Receivable 300,672 NARFE PAC is subject to federal income taxes under Investments 9,231,256 IRC Section 527 with respect to certain investment income. Total Financial Assets Available within One Year 11,151,731 For the years ended December 31, 2020, no provision for federal or state income taxes was made, as there was no Less: significant taxable income. Amounts unavailable for general expenditures within The Association follows the authoritative guidance relating one year due to donor’s restriction with purpose restriction (1,216,132) to accounting for uncertainty in income taxes included in Financial Assets Available to Meet General FASB ASC Topic 740, Income Taxes. These provisions provide Expenditures Within One Year $ 9,935,599 consistent guidance for the accounting for uncertainty in income taxes recognized in an entity’s financial statements and The Association has various sources of liquidity at prescribe a threshold of “more likely than not” for recognition its disposal, including cash and cash equivalents and and derecognition of tax positions taken or expected to be investments, which are available for general expenditures, taken in a tax return. liabilities and other obligations as they come due. The Association performed an evaluation of uncertainty Management is focused on sustaining the financial liquidity in income taxes for the year ended December 31, 2020, and of the Association throughout the year. This is done through determined that there were no matters that would require monitoring and reviewing the Association’s cash flow needs recognition in the consolidated financial statements or that on a regular basis. As a result, management is aware of the may have an effect on its tax-exempt status. As of December cyclical nature of the Association’s cash flow related to the 31, 2020, there are no audits for any tax periods that are Association’s various funding sources and is therefore able to currently pending or in progress. It is the Association’s policy ensure that there is cash available to meet current liquidity to recognize interest and/or penalties related to uncertainty needs. As part of its liquidity plan, excess cash is invested in in income taxes, if any, in income tax or interest expense. As publicly traded investment vehicles, including mutual funds, of December 31, 2020, the Association had no accruals for or to support organizational initiatives. The Association interest and/or penalties. can liquidate its investments anytime, and therefore the The Association regularly monitors liquidity required to meet its annual operating needs and other contractual commitments, while also striving to preserve the principal and return on the investment of its funds. The Association’s financial assets available within one year of the statement of financial position date for general expenditures at December 31, 2020, were as follows:

NOTE 9: PENSION PLAN

The Association has a Retirement Savings Plan (the Plan). Employees are eligible to participate in the Plan on the first day of the month coinciding with or next following the employee’s hire date. Employees become eligible for employer matching funds on the first day of the Plan Year (January 1) or the first day of the seventh month of the Plan Year (July 1) coinciding with or next following hire date. Once eligible, an employee is 100% vested. The Association matches 60% of each employee’s voluntary contribution up to 6% of annual compensation. Total contributions made by the Association were approximately $76,000 for the year ended December 31, 2020.

NOTE 10: COVID-19 IMPACT

The COVID-19 outbreak in the United States has caused business disruption through mandated and voluntary closing of business across the country for non-essential services. While the disruption is currently expected to be temporary, there is considerable uncertainty about the duration of closings. The Association has been able to continue its operations in a remote environment and is making plans to adjust activities that cannot, however, at this point, the extent to which COVID-19 may impact the Association’s financial condition or results of operations is uncertain.

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The accompanying financial statements include certain prior year 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 GAAP. Accordingly, such information should be read in conjunction with the Association’s financial statements for the year ended December 31, 2019, from which the summarized information was derived.

NOTE 13 – SUBSEQUENT EVENTS

The Association’s management has evaluated, for potential recognition or disclosure, events and transactions through April 21, 2021, the date the financial statements were available to be issued. There were no subsequent events identified that require recognition or disclosure in these consolidated financial statements.

Supplementary Information Consolidating Schedule of Financial Position December 31, 2020

Consolidating Schedule of Activities for the Year Ended December 31, 2020

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The Way We Worked

Protecting Our Natural Resources U.S. Fish and Wildlife Service biologist Rob Elliot of the Green Bay Fish Resource Office, right, examines an adult lake sturgeon with Tom Meronek of the Wisconsin Department of Natural Resources, center, and Greg Banker of the Stockbridge-Munsee Indian Community Conservation Office. The Green Bay Fish and Wildlife Conservation Office implements the Fish and Wildlife Service’s fisheries programs in the Lake Michigan and Great Lakes basins to conserve, protect, manage, and restore native fish and wildlife resources. Its activities include: native fish restoration; fish population assessment and survey design; interjurisdictional and treaty fisheries management; marking of trout and salmon stocked into the Great Lakes basin; fish passage and aquatic habitat evaluation and restoration; and monitoring and responding to the introduction and spread of aquatic invasive species. PHOTO from the records of the U.S. Fish and Wildlife 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 www.shfg.org.

NARFE MAGAZINE AUGUST 2021

DID YOU KNOW? The U.S. Fish and Wildlife Service, part of the Interior Department, traces its roots to 1871, when the U.S. Commission on Fish and Fisheries was created to remedy a decline in fisheries; its initial appropriation was $5,000. Learn more at https://fws.gov/.

The Way We Worked celebrates the past 100 years of public service through archival images. Eargo and GEHA are proud sponsors of NARFE’s Centennial.

5 Great Reasons

Why Oticon MoreTM could be the answer to your hearing problems.

1 Oticon More with Brain HearingTM technology

A revolutionary hearing aid that gives the brain more of the relevant information it needs to make better sense of sound. So you can get better speech understanding with less effort and the ability to remember more.

3 Connectivity made easy

Simple, wireless connectivity to your favorite devices via Bluetooth®. Make hands-free calls, stream music, connect to smart devices and more!

2 The hearing aid with built-in intelligence Works more like how the brain works because it learned through experience. Clinical studies prove Oticon More delivers 30% more sound to the brain and increases speech understanding.1

4 Never change a battery again

A trouble-free rechargeable solution allows you to recharge at night for a full day of hearing. FREE charger included!2

5 No out of pocket expense

Take advantage of your $2500 hearing benefit! You may be eligible for a pair of Oticon MoreTM3 hearing aids for $0 out of pocket.3

This special offer for federal employees and retirees is available only at Your Hearing Network locations. To find your location call 1-877-696-5335. Compared to Oticon Opn STM, Santurette, et al. 2020. Oticon More clinical evidence. Oticon Whitepaper Lithium-ion battery performance varies depending on hearing loss, lifestyle and streaming behavior. 3 Your out-of-pocket costs may vary depending on plan benefits, eligibility, deductible, co-insurance, and model of device chosen. This is not a guarantee of coverage or payment. Benefit is not available through all insurance plans. Please call us to verify your coverage. 1 2

Members,

Pay $0

out-of-pocket! Blue Cross and Blue Shield Service Benefit Plan members may be eligible for two fully covered hearing aids with zero out-of-pocket cost on many models when applying your hearing aid benefit*. HearUSA offers all these features and follows all safety protocols for our customers and employees. Call 1-855-252-0025 to discover more or visit www.blue365deals.com/fep. EXPERIENCE - HearUSA has been changing lives through better hearing since 1987 and a proud NARFE Circle Sponsor since 2016. CHOICE - All major hearing aid brands and styles available, including completely-in-the-canal, the smallest custom hearing aids on the market. TECHNOLOGY - Smart technology helps you hear more clearly and eliminates annoying feedback “whistling”. RECHARGABLE - Most models have rechargeable options; no need to ever replace batteries! Plus, many models connect with your cell phone! TELEHEALTH - Take advantage of HearUSA Telehealth Services where you obtain quality care at home. Telehealth appointments are available.

Three-year manufacturer’s warranty covers repairs Three-year loss and damage coverage provides peace of mind One-year of FREE batteries eliminates an extra expense One year of FREE in-office service will get you off to a great start!

Call 1-855-252-0025 to schedule a FREE in-person or telehealth hearing appointment today! *The Service Benefit Plan will pay a hearing aid benefit for Standard and Basic Option up to $2,500 total every 5 calendar years for adults age 22 and over, and up to $2,500 total per calendar year for members up to age 22. FEP Blue Focus does not have a hearing aid benefit. Do not rely on this communication piece alone for complete benefit information. All benefits are subject to the definitions, limitations, and exclusions in the Blue Cross and Blue Shield Service Benefit Plan brochure. Blue365® offers access to savings on health and wellness products and services that members may purchase from independent vendors, which are not covered benefits under the Blue Cross and Blue Shield Federal Employee Program, Blue Cross Blue Shield FEP Dental and/or Blue Cross Blue Shield FEP Vision. These products and services will be offered to you through the entire benefit year. During the year, the independent vendors may offer additional discounts on these products and services. To find out what is covered under your policy, contact the customer service number on your member ID card. Any disputes regarding your health insurance products and services may be subject to your plan’s grievance process. BCBSA may receive payments from vendors providing products and services on or accessible through the Site. Neither BCBSA nor any Blue Company recommends, endorses, warrants, or guarantees any specific vendor, product or service available under or through the Blue365 Program or Site.

August 2021 NARFE Magazine

Articles inside

NARFE Members Enthusiastically Advocate During Grassroots Advocacy Month

Member Perks

NARFE 2020 Financial Statements

FEVS Reports Increased Federal Job Satisfaction During Pandemic

White House Budget Proposes 2.7 Percent Raise, OPM IT Modernization

New Postal Reform Legislation Could Raise FEHB Premiums

From the President

Managing Money