July 17, 2015

Contact: Chris Schloesser/Marc Rehmann

(202) 225-8699

Edwards Statement on Proposal to Use Federal Workers to Pay for Highway Fund Extension

Washington, D.C. – Congresswoman Donna F. Edwards (MD-4) released the following statement on a Senate Republican proposed change to federal employee retirement plans to fund a multi-year surface transportation bill:

“I am disappointed that Senate Republicans are considering changes and cuts to federal employee retirement plans to fund a multi-year extension of MAP-21 and the Highway Trust Fund,” Edwards said. “There are more than 430,000 civilian federal employees in Maryland, Virginia, and the District of Columbia.  They ensure the safety of our food and airways, defend our homeland, provide health care to our nation’s veterans, search for cures to devastating diseases, and provide vital support to our troops at home and abroad.  Thus far, the federal workforce has already sacrificed $159 billion in reduced pay and benefits towards deficit reduction through a 3-year pay freeze, furloughs, annual pay raises below the baseline, and increased retirement contributions for future hires.  Additional cuts would further undermine the federal government’s ability to recruit and hire a talented workforce and bring us no closer to a responsible approach to funding our nation’s infrastructure needs.

“I strongly support a long-term and robust transportation bill that adheres to the use of user pays that will bring our roads, rails, and bridges into the 21st Century.  That is why I, along with a number of my House Democratic colleagues, introduced the GROW AMERICA Act, which is a six-year, $478 billion bill. We need to invest in our infrastructure in a way that puts American families back to work.”

Under their proposal, Senate Republicans would change the way the interest rate for the G-Fund in the Thrift Savings Plan is calculated from a four-year average to a three-month average.  It has been estimated that such a change would raise $32 million over 10 years, though there is a concern that this would have a dramatic negative impact on employee savings for federal retirement.  This idea was first included in the House Republican Fiscal Year 2016 Budget Resolution earlier this year.

In the past two Congresses, Congresswoman Edwards has introduced the Federal Employee Pension Fairness Act, which would repeal the three-tier employee pension contribution system that makes new workers pay more out of pocket than those longer employed.  Under current law, recently hired federal employees are forced by the Middle Class Tax Relief and Job Creation Act of 2012 and the Bipartisan Budget Act of 2013 to raise their contribution amount to their own pensions from 0.8% to 4.4%.   Congresswoman Edwards’ legislation, H.R. 750, would restore the Federal Employee Pension contribution to their original 0.8%, and instead close corporate tax loopholes for companies that are incorporated overseas, but managed and controlled in the United States.