The Federal Law Enforcement Officers Association (FLEOA) last week sent a letter to acting director of the Office of Personnel Management (OPM), Margaret Weichert, regarding OPM’s 2016 unpublished policy change concerning the division of a FERS special annuity supplement between a retiree and his or her former spouse. FLEOA represents more than 27,000 federal law enforcement officers and agents across 65 federal agencies.
Under current rules, employees covered by the Federal Employees Retirement System (FERS) and who retire before age 62 (before being eligible for Social Security benefits) are eligible to receive the FERS supplement annuity.
‘Marital Share’ of FERS Special Annuity Supplement
In 2016, FLEOA raised concerns about an apparent change in OPM policy regarding the calculation of the annuity supplement received by certain LEOs who are subject to a state divorce decree. Specifically, FLEOA stated that OPM had recently concluded that if a former spouse is entitled to a portion of a retired LEO’s basic annuity, that former spouse is also entitled to a portion of the former LEO’s annuity supplement, even if the divorce decree is silent on the issue. FLEOA noted that this policy change was implemented without public notice. Further, OPM had applied this policy retroactively, resulting in the creation of a new debt that the retired LEOs now owed their former spouses.
FLEOA Urges OPM to Repeal Annuity Change
“In the more than two years since it implemented this revised policy, OPM has applied its reinterpretation retroactively and with little to no regard for the financial harm it has inflicted on retirees,” FLEOA President Nathan R. Catura wrote in the letter to Weichert on Oct. 15. “It has created individual retiree debts due to the federal government of as much as $28,389.96 (that we are aware of)—debts for which OPM has sought repayment in the form of prospective and retrospective assessments from annuitants’ retirement benefits.”
“Furthermore, as the MSPB intimated in is April 2018 decision overturning OPM’s actions against a retired Air Traffic Controller who was directed to give back more than $24,000 in earned retirement benefits, this reinterpretation of the divisibility of the RAS seems to have remained a closely-held secret,” Catura continues. “In fact, it is not clear that OPM has made publicly available any guidance or instructions to even current employees planning for retirement that their benefits are subject to reduction under this revised policy.”
“Both the OPM-OIG and the MSPB have found that OPM’s actions constituted a reinterpretation of current law that was outside of the agency’s authority and was done absent a specific grant of authority from Congress or through a notice-and-comment rulemaking process,” Catura notes. “The OIG found in particular that OPM’s reinterpretation of current law and subsequent actions against impacted retirees constituted an agency rulemaking action that violated the APA. This is a view shared not just by our organization, but by the Chairman of the Senate Homeland Security and Governmental Affairs Committee’s Regulatory Affairs Subcommittee.”
Below is the full text of FLEOA’s letter to OPM:
October 15, 2018
Ms. Margaret Weichert
Acting Director
U.S. Office of Personnel Management
1900 E Street, NW
Washington, DC 20415-1000
Dear Acting Director Weichert:
I am writing on behalf of the more than 27,000 members of the Federal Law Enforcement Officers Association to request your assistance in overturning OPM’s 2016 unpublished policy change concerning the division of a FERS Retiree Annuity Supplement (RAS) between a retiree and his or her former spouse. This policy change constituted an unwarranted reinterpretation of a 30-year old provision of the FERS statute and, more importantly, has caused real financial harm to federal law enforcement and other retirees for the more than two years that it has been enforced by the agency. It is an issue that FLEOA has raised with each of your three predecessors as OPM Director who, in turn, allowed the agency to institute the policy in secret, disregarded an OIG report (Management Advisory Letter L-2018-1, “Review of the U.S. Office of Personnel Management’s Non-Public Decision to Prospectively and Retroactively Re-Apportion Annuity Supplements”) which in part questioned the manner in which OPM promulgated the policy change, and then permitted the agency to appeal an MSPB decision overruling OPM’s actions. And it is an issue that has raised concern on both sides of the aisle in Congress, particularly with respect to the fact that this policy change likely violated the Administrative Procedure Act (APA).
By way of background, beginning on or about July 2016, OPM implemented a revised policy with respect to the division of a RAS between a retiree and his or her former spouse based on a fundamental reinterpretation of 5 USC 8421(c) and 8467. In promulgating this policy change, however, OPM failed to notify the public or impacted retirees prior to its implementation, despite the fact that such a decision would have far-reaching financial implications for both retirees and their former spouses. Both the OPM-OIG and the MSPB have found that OPM’s actions constituted a reinterpretation of current law that was outside of the agency’s authority and was done absent a specific grant of authority from Congress or through a notice-and-comment rulemaking process. The OIG found in particular that OPM’s reinterpretation of current law and subsequent actions against impacted retirees constituted an agency rulemaking action that violated the APA. This is a view shared not just by our organization, but by the Chairman of the Senate Homeland Security and Governmental Affairs Committee’s Regulatory Affairs Subcommittee. In a May 9 letter to then-Director Pon, Sen. James Lankford also noted that OPM’s reinterpretation of the FERS statute and retrospective application may have violated the APA, causing undue hardship to annuitants without providing adequate notice of the change or the opportunity for public input on it.
As Sen. Lankford, the OIG, and MSPB have concluded, this policy change was implemented in a clandestine fashion without any regard for the court-ordered and previously-litigated provisions of the specific divorce settlements of affected retirees. Instead, retirees and their former spouses only learned of OPM’s actions when their annuity payments changed, in some cases years after the parties had divorced and a state court had ordered a former spouse’s marital share.
In the more than two years since it implemented this revised policy, OPM has applied its reinterpretation retroactively and with little to no regard for the financial harm it has inflicted on retirees. It has created individual retiree debts due to the federal government of as much as $28,389.96 (that we are aware of)—debts for which OPM has sought repayment in the form of prospective and retrospective assessments from annuitants’ retirement benefits. Furthermore, as the MSPB intimated in is April 2018 decision overturning OPM’s actions against a retired Air Traffic Controller who was directed to give back more than $24,000 in earned retirement benefits, this reinterpretation of the divisibility of the RAS seems to have remained a closely-held secret. In fact, it is not clear that OPM has made publicly available any guidance or instructions to even current employees planning for retirement that their benefits are subject to reduction under this revised policy.
We recognize that OPM’s efforts to penalize certain retired law enforcement officers and other federal retirees through this covert regulatory action occurred prior to you assuming the position of Acting Director. However, these actions—whether or not officially sanctioned by your predecessors—have been allowed to continue for far too long. As such, we respectfully request that you take immediate and public steps to rectify this situation by: (1) immediately rescinding any and all debt collection efforts against retirees; (2) restoring all improperly seized RAS and/or other retirement benefits to the affected retirees; and (3) repealing the policy guidance issued in violation of the APA by the Retirement Services division that apportions a divorced retiree’s FERS annuity supplement where such division is not expressly provided for in a qualifying court order. Such actions on your part would be similar to Congress’s recent successful effort to overturn OPM’s other 2016 reinterpretation of the FERS statute that significantly reduced the pensions of and made debtors out of criminal investigator retirees at the TSA Office of Inspection. That legislation—enacted as Sec. 1908 of the FAA Reauthorization Act signed into law on October 5—clarified the law with respect to the retirement creditability of Law Enforcement Availability Pay (LEAP) compensation for these criminal investigators and directed OPM to provide full retroactive relief to the impacted retirees.
Thank you in advance for your attention to this request. FLEOA stands ready to work with you to ensure an equitable and speedy resolution to this matter.
Sincerely,
Nathan R. Catura
National President