April 2012 Magazine

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For Active and Retired Federal Employees

RETIREMENT LIFE

APRIL 2012, Volume 88, Number 4

LEGISLATIVE REPORT 8 12

Budget Seeks Savings at Expense of Feds

12

NARFE Testifies: Feds Are Being Singled Out for ‘Disproportionate Sacrifice’

14

NARFE Testifies About Retirement Claims Processing Delays

18 20

Civics 101: Redistricting Progress Report

Regions

State Tax Treatment of Federal Annuities

SPECIAL SECTIONS

24

House Committee Approves Bill Cutting Federal Workers’ Benefits

COLUMNS 6 Message From the National President

28 Managing Money 30 Live Well 43 Report From the

COVER STORY

38 National Convention

Feds Under Attack.A barrage of bills is aiming to reduce federal benefits and the size of the federal workforce to pay for everything from a payroll-tax holiday to mass transit.

40 Candidate Statements

DEPARTMENTS 32 44 46 50

Cover design by Jim Richards.

Questions & Answers NARFE News Out & About For the Record: TSP Investments, COLA Chart ‘Like’ us on Facebook (NARFE National Headquarters)

visit us online at www.narfe.org

Update

45 NARFE Scholarship Application

NARFE Resources NARFE-PAC Coupon . . . . . . . .13 NARFE-FEEA Coupon . . . . . . .44 Alzheimer’s Coupon . . . . . . . . .46 Membership Application . . . . . .47 NARFE Member Perks . . . . . . .48

NATIONAL OFFICERS

Here’s How to Contact NARFE ...

JOSEPH A. BEAUDOIN, President; natpres@narfe.org PAUL H. CAREW, Vice President; natvp@narfe.org ELAINE HUGHES, Secretary; natsec@narfe.org RICHARD G. THISSEN, Treasurer; nattreas@narfe.org

If you want to: • Join NARFE Call (toll-free):

800-627-3394 or 800-456-8410 Or go to: www.narfe.org

If you want to: • Change your address • Check your membership status • Find out dues owed • Provide a death notification Call (toll-free):

800-456-8410 Email:

memberrecords@narfe.org If you want to: • Add your e-mail address to your record (to receive GEMS e-mail messages, the Legislative Hotline and NARFE NewsWatch): Call (toll-free):

800-456-8410 Email:

memberrecords@narfe.org

REGIONAL VICE PRESIDENTS REGION I Augie Stratoti (Connecticut, Maine, Massachusetts, New Hampshire, New York, Rhode Island and Vermont) Tel: 603-889-1073 Email: augrs@juno.com REGION II Ronald P. Bowers (Delaware, District of Columbia, Maryland, New Jersey and Pennsylvania) Tel: 410-308-0420 Email: narferbowers@msn.com REGION III Donald Stewart (Alabama, Florida, Georgia, Mississippi, Puerto Rico, South Carolina and Virgin Islands) Tel: 305-442-6388 Email: dejs33149@aol.com REGION IV Paul E. Johnson (Illinois, Indiana, Michigan, Ohio and Wisconsin) Tel: 812-306-5137 Email: pejohnson@tds.net REGION V Carol R. Ek (Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota and South Dakota) Tel: 620-241-1131 Email: ek617@att.net

REGION VI Jerome S. Smith (Arkansas, Louisiana, Oklahoma, Republic of Panama and Texas) Tel: 903-534-5849 Email: retiredjer@aol.com REGION VII Betty Lucero-Turner (Arizona, Colorado, New Mexico, Utah and Wyoming) Tel: 719-583-0910 Email: blturner2311@aol.com REGION VIII Helen L. Zajac (California, Guam, Hawaii, Nevada and Republic of Philippines) Tel: 707-644-7565 Email: hlz17@aol.com REGION IX Lanny G. Ross (Alaska, Idaho, Montana, Oregon and Washington) Tel: 360-692-9741 Email: lannyjean@comcast.net REGION X William F. Martin (Kentucky, North Carolina, Tennessee, Virginia and West Virginia) Tel: 540-872-3345 Email: narfe2065@hughes.net

E-mail: memberrecords@narfeorg

If you want to:

• Hear the Legislative Hotline Call (toll-free):

877-217-8234 If you want to: • Get materials to recruit members: Call (toll-free):

800-627-3394 Email:

rr@narfe.org

For any other NARFE matter: Call NARFE Headquarters

703-838-7760 Email: hq@narfe.org Fax:703-838-7785 Write: NARFE 606 N. Washington St. Alexandria,VA 22314

NARFE MAGAZINE Volume 88,Number 4 Editor, Margaret M. Carter Assistant Editor, Donna J. St. John Editorial Administrator, Toni Vallario Graphic Designer, Beth Bedard Contributing Designers, Charlene Gridley, Jim Richards Editorial Board: Joseph A. Beaudoin, Paul H. Carew, Elaine Hughes, Richard G. Thissen Editorial Office: NARFE, Attn: NARFE magazine, 606 North Washington St., Alexandria, VA 22314-1914; Phone: 703-838-7760; Fax: 703-838-7781; Email: rl@narfe.org Advertising Sales: Warren Berger, Media People Inc., 122 East 42nd Street, Suite 725, New York, NY 10168; 212-779-7172, ext. 223; Email: wberger@mediapeople.com

NARFE for the Visually Impaired On the Telephone: This publication can be heard on the telephone by persons who have trouble seeing or reading the print edition. For more information, contact the National Federation of the Blind NFB-NEWSLINE® service at 866-504-7300 or go to www.nfbnewsline.org.

On Tape: Issues of NARFE magazine are also available on cassette through the National Library Service for the Blind and Physically Handicapped. To find out about availability in your area, call 800-424-8567 and ask for the Reference Section.

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 (ISSN 1948-4453) is published monthly by the National Active and Retired Federal Employees Association (NARFE), 606 N. Washington St.,Alexandria,VA 22314. Periodicals postage paid at Alexandria,VA, and additional mailing offices. Members: Annual dues includes subscription. Non-member subscription rate $45. Postmaster: Send address change to: NARFE Attn:Member Records,NARFE 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 © 2012, NARFE. Advertisements in the magazine are not endorsements of products and/or services by NARFE, unless officially stated in the ad. We shall accept advertising on the same basis as other reputable publications: that is, we shall not knowingly permit a dishonest advertisement to appear in NARFE, but at the same time we will not undertake to guarantee the reliability of our advertisers.

4

APRIL 2012 | NARFE

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A Message From the National President

Your Opinion Counts

W

hile there are probably a few who would disagree, I believe that one of the things that makes NARFE strong is the democratic nature of how we conduct business. We actively solicit the opinions and suggestions of our rank-and-file members.

Such is the case in the discussion over revising NARFE’s Bylaws. As reported in previous issues of NARFE magazine, a committee of 10 NARFE members was tasked with examining our Bylaws and, where the committee saw fit, suggesting revisions or changes. This process will culminate with an up-or-down vote during the National Convention in Reno-Sparks, NV, August 26-30.

I mention this again because, as you receive this issue of NARFE magazine in late March, you have only a few days left to submit comments to the Bylaws Revision Committee by the March 31 deadline. If you have any comments or suggestions, send them to Mary Williams, chair, Bylaws Revision Committee, NARFE Headquarters, 606 N. Washington St., Alexandria, VA 22314-1914. You also can send your comments via email to brc@narfe.org. The proposed Bylaws revisions were published in the March issue of NARFE magazine and also can be found online at www.narfe.org (click on the National Convention logo). After the March 31 deadline, the next opportunity to recommend any changes will be at the National Convention.

As the convention nears, I also want to remind you that: resolutions not dealing with the Bylaws must be submitted to NARFE Headquarters no later than May 15; delegate forms must be submitted no later than June 30; proxy forms must be submitted by August 11; and registrations must be postmarked by August 2. If you plan to run for a National Executive Board position – National Officer or Regional Vice President – the deadlines for candidate statements to be

published in NARFE magazine are April 1, for inclusion in the June issue, and May 1, for inclusion in the July issue. For more information on the 32nd NARFE National Convention, visit the NARFE website.

We have been very busy at NARFE Headquarters over the last few months. In a sevenday period, NARFE testified twice before Congress. On January 25, David Snell, Retirement Benefits Service Department director, testified before a House subcommittee and spoke out against reducing federal pay and retirement benefits to pay for the payroll-tax holiday extension (see p. 12). A week later, I testified before a Senate subcommittee on the hardships recent federal retirees are facing because of a backlog at the Office of Personnel Management in processing their retirement papers (see p. 14).

We’ve also had a number of meetings with leaders of military organizations, whose retiree members are facing the same problems as federal civilian retirees. We met with the Air Force Association, the Armed Forces Benefit Association and the Military Officers Association of America to discuss closer cooperation and get them more involved in our “Protect America’s Heartbeat” campaign.

The busy federation convention season begins this month. Between now and mid-June, NARFE Headquarters personnel will participate in more than 30 federation conventions, either in person or via an electronic method, such as Skype and GoToMeeting. And this year, for the first time, we are offering any federation that is not eligible for a Headquarters officer or staff member (we are on a two-year cycle) the opportunity to request participation electronically by someone from Headquarters. This technology will allow us to cover more conventions for less money and bring our NARFE family closer together. And that will make for a stronger NARFE!

YOU HAVE only a few days left to submit comments on the proposed revised Bylaws.

Joseph A. Beaudoin natpres@narfe.org

6

APRIL 2012 | NARFE

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LEGISLATIVE REPORT

Budget Seeks Savings at Employees to Expense of Feds Pay More for

P

resident Obama submitted to Congress his Fiscal Year (FY) 2013 Budget on February 13, proposing more than $4 trillion in deficit reduction over the next 10 years. Unlike prior budgets he has submitted since

taking office in 2009, the president’s latest submission breaks new ground in seeking budget concessions from active federal employees – and future feds — despite the fact that federal employees have already seen their wages cut by more than $60 billion as a result of the two-year pay freeze.

The Obama budget follows closely on the heels of House committee action to change the rules under the Federal Employees Retirement System (FERS) for new employees in favor of a retirement plan much less generous in its defined-benefit dimension and much more costly to employees (see story, p.

12). The Federal-Postal Coalition had hoped that the White House had turned the corner on seeking cuts from federal employees, particularly in light of the president’s earlier announcement proposing a 0.5 percent pay raise. This proposed pay raise is probably more symbolic than anything else, but it is still a departure from the pay freeze in place since 2010.

THE SPECIFICS Under the theme “American Values:

8

Retirement

Everyone Pays Their Fair Share,” the Obama budget calls for $278 billion overall in “non-health mandatory savings” through reforms in agriculture subsidies and direct payments, the Pension Benefit Guaranty Corporation (fees and charges) and federal civilian worker retirement. No similar reforms are proposed for military retirement.

Among the specific proposals in the FY 2013 budget is one element originally proposed by the bipartisan National Commission on Fiscal Responsibility and Reform or “Deficit Commission.” In December 2010, the Deficit Commission called for $70 billion in cuts from federal retirement programs over 10 years, citing as possible examples: using the high-five years of salary rather than the current high-three years for purposes of calculating both

■ Members of the House and

Senate are scheduled to be in their districts and states April 2-13 for the Easter/ Passover recess.

■ Taxpayers get a two-day

extension to file their taxes this year because April 15 falls on a Sunday, and April 16 is Emancipation Day, a holiday in Washington, DC. Since the Internal Revenue Service follows the District’s holiday calendar, tax returns are due Tuesday, April 17. Emancipation Day celebrates the day in 1862 when Abraham Lincoln freed the slaves in the District of Columbia.

■ To find out how different

states tax federal annuities, check out our guide on p. 20.

We also include a state-bystate list of sales taxes.

LEGISLATIVE HOTLINE Toll-free! (24 Hours): 877-217-8234 Legislative Action Center: www.narfe.org APRIL 2012 | NARFE

Legislative Report Civil Service Retirement System and Federal Employees Retirement System annuities (a savings of $500 million in the first year and $5 billion over 10 years); eliminating all costof-living adjustments (COLAs) for those retiring before age 62, with a catch-up COLA at age 62 (a 10-year savings of $17 billion); and “adjust[ing] the ratio of employer/employee contributions to federal employee pension plans to equalize contributions.”

In the president’s FY 2013 budget, the White House proposes a 1.2 percent increase in contributions by current employees over the next three years (0.4 percent per year); the eventual retirees would see no increase in the value of their annuities.

The budget also proposes the elimination of the FERS Annuity Supplement for employees who retire before age 62 – prior to becoming eligible to receive their Social Security benefit. Elimination of the supplement would apply only to new hires, and it would not apply to employees in positions with mandatory retirement ages, such as air traffic controllers and federal law enforcement personnel.

NARFE President Joseph A. Beaudoin said: “The administration’s budget plan to modestly roll back the federal employee pay freeze by 0.5 percent this year will quickly be undone by the White House’s other plan to force middle-class federal workers to contribute 1.2 percent more of each paycheck to a retirement system that is already fully funded. Our nation’s federal workers currently are saving the country $60 billion by undergoing a two-year pay freeze. We understand the need for budget austerity, but it is unsettling that the administration is not recognizing how much federal workers have contributed to the nation’s shared sacrifice while others are yet to help carry the burden.”

A significant proposal in the president’s budget of benefit to federal employees would allow them to work part time while collecting partial pension benefits. Federal employees also would earn partial retirement credit for their part-time service. The administration estimates a savings of $720 million over 10 years because agencies could stagger retirements and delay the hiring of new employees. David Snell, director of NARFE’s Retirement Benefits Service Department, said: “A transition phase seems like an efficient way to help an agency with its succession planning. There are no apparent downsides to the affected employee in terms of pay or retirement and health benefits.”

WHAT’S NEXT The president’s budget submission traditionally begins the annual budget process. With the blueprint on Capitol

10

STORY HIGHLIGHTS ■ President Obama’s FY 2013 Budget calls for

current employees to pay 1.2 percent more in retirement contributions over the next three years (0.4 percent per year) with no increase in the value of their annuities.

■ Under the budget, federal employees would get a 0.5 percent raise. NARFE contends this would be “undone” by the increase in retirement contributions.

■ The budget also proposes allowing federal employees to work part time while drawing partial retirement benefits, which NARFE applauds.

Hill, House and Senate Budget Committees, along with their respective tax-writing and appropriations committees, will start the hearing process in earnest. Under normal circumstances, the House and Senate next would move to a concurrent resolution on the budget. The budget resolution, once agreed to by both houses, becomes the guidepost for spending and revenue decisions for the year ahead, with the goal of resolving all budget decisions by the start of the fiscal year on October 1. But this year promises to be different from many in the past, thanks in no small part to the looming presidential/congressional election and last year’s debt-limit agreement (Budget Control Act), which established spending limits and a sequestration process to ensure deficit reduction.

Even before President Obama sent his 800-page budget document to the Hill, Senate Majority Leader Harry Reid, DNV, announced his intention that the Senate not even consider a budget resolution this spring, arguing that the spending levels had already been set in the debt-limit agreement.

Even in the absence of the traditional formal budget process, federal employees and retirees should not rest easy.

The savings slated from the proposals described above have already been discussed as “pay-fors” for everything from pending highway legislation to covering cuts in the Pentagon budget (see story, p. 24).

Stay on top of the latest legislative developments. Sign up for NARFE’s electronic messaging system (GEMS), if NARFE does not already have your email address, to receive Legislative Alerts and the weekly Legislative Hotline. Go to www.narfe.org or call NARFE’s Member Records Department at 800-456-8410.

By Alan Lopatin, Legislative Counsel APRIL 2012 | NARFE

Canadian Rockies Tour Plus “Rocky Mountaineer” Rail Trip

14 Days

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Start in Seattle; after a morning city tour, take a scenic drive to Spokane and visit The Grand Coulee Dam and Dry Falls. Drive through Coeur d’Alene and Flathead Lake as you head east to “The Big Sky Country” of Montana. Visit sister parks: Glacier National Park, U.S.A. and Waterton Lakes National Park in Canada. Your tour in the heart of the Canadian Rockies will include Banff (2 nights), Banff National Park, Glacier fed Peyto Lake and Lake Louise, a “snow coach” ride onto Athabasca glacier, Jasper and Jasper National Park (1 night). Continue your drive along the Icefields Parkway and visit Yoho National Park, cross the Continental Divide, and traverse the Canadian Rockies’ western slope through Golden, Revelstoke, and the Lake Okanagan region. In Whistler, board the Rocky Mountaineer train for Vancouver and travel through breathtaking scenery of waterfalls and mountains unavailable by other travel modes. Next, a ferry trip to Vancouver Island with a night in the capital, Victoria, British Columbia. The following morning take another ferry to Port Angeles; tour Olympic National Park and end back in Seattle!

Yellowstone + Rocky Mountain Tour 14 Days

Join other NARFE members departing August 15, 2012

from $1648*

Your tour begins in the “Mile High City” of Denver, followed by Cheyenne, WY. The next two days you will visit Fort Laramie; Mount Rushmore and Crazy Horse Memorial in South Dakota. Then return to Wyoming with a stop in Deadwood, continuing through the Black Hills to Little Big Horn Battlefield and the Buffalo Bill Historical Center. Then you will depart for Yellowstone National Park (2 days) with extensive sightseeing, including Old Faithful and Hayden Valley. Your journey continues to Grand Tetons National Park with spectacular landscape; Jackson Hole, WY; Salt Lake City, UT with a city tour including the Great Salt Lake and opportunity to witness the Tabernacle choir rehersal. Then travel West visiting the Utah Field House Museum; Dinosaur National Monument and explore the vast variety of fossils and Rocky Mountain National Park including a drive through the park on Trail Ridge Road.

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Northeast Cruise & Tour 10-Day Cruise to French Canada & Nova Scotia 5-Day Tour featuring: Boston - Cape Cod - New York City

15 Days

Travel with other NARFE members departing September 26, 2012

from $1798*

Start in historic Boston with a city tour including Old North Church and Bunker Hill. Travel to Plymouth and see the Pilgrim’s landing site and then on to “Old Cape Cod” with “sand dunes and salty air.” You’ll also visit Chatham & Provincetown and overnight in the Hyannis area. Your journey continues to Bridgeport, Connecticut; stopping in Newport, Rhode Island along the way and touring two famous mansions, once home to the likes of the Vanderbilt’s. Then it’s on to the “Big Apple,” New York City for an exciting tour of Manhattan with a local city guide. You will also see and stop at Ground Zero, view Lady Liberty from Battery Park and much more. The next day you will board the NCL “Gem” for your 10-day FreeStyle cruise. Ports include: Halifax, Nova Scotia and Quebec City, Quebec with its remaining fortified city walls; Château Frontenac; and Notre-Dame Cathedral. Sail on and stop in Corner Brook, Newfoundland and Sydney on Cape Breton Island, Nova Scotia. Disembark in New York City for your flight home.

Hawaiian Kings Tour The Best, 2-Week, 4-Island, Hawaiian Vacation Available At The Most Affordable Price!

15 Days

Join other NARFE members departing Sept. 26 or Nov. 26, 2012

from $1868*

“Carefree” best describes your vacation starting with your Polynesian tour director meeting you at the Honolulu airport. Spend 5 nights in Waikiki Beach (Honolulu) on Oahu; 3 nights on Kauai; 2 on Maui; 1 night in Hilo and 3 in Kona, on Hawaii (‘the-big-island”). Escorted sightseeing includes a city tour of Honolulu, Punchbowl Crater and Pearl Harbor, the Wailua River Boat Cruise, The Old Whaling Capital of Lahaina, the Iao Valley, Hilo Orchid Gardens, Rainbow Falls, Black Sand Beaches, Volcanoes National Park and more. Includes: hotel accommodations, taxes, inter-island flights, baggage handling, escort, & sightseeing.

Save on this Repositioning Cruise

Tour Spain ~ Cruise to Miami 21 Days

Travel with other NARFE members departing October 14, 2012

from $2198*

Your tour of Spain begins in Madrid for four days and nights. Enjoy a panoramic sightseeing tour that includes the beautiful 16th century square, The Royal Palace and the historic Habsburg quarter. Enjoy full-day excursions to Toledo; the former capital of the Spanish Empire, the Roman City of Segovia and El Escorial. Then travel to Zaragonza; Spain’s fifth largest city en route to Barcelona. Spend two days and nights exploring this cosmopolitan city known for its art, architecture and style. See The Basilica and visit the Joan Miro Museum and Poble Espanyol; a unique open-air museum. Then board NCL’s newest ship the Epic for your 13-day FreeStyle cruise. As you sail, enjoy the many onboard facilities and entertainment choices. Ports include Ponta Delgada, Azores; with miles of sandy beaches and majestic white houses and St. Thomas, the capital of the U.S. Virgin Islands. Then relax during your final days at sea and disembark in Miami on November 3.

*Price per person, based on double occupancy. Airfare is extra.

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Legislative Report

House Committee Approves Bill Cutting Federal Workers’Benefits

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he House Oversight and Government Reform Committee has approved H.R. 3813, the Securing Annuities for Federal Employees Act of 2012. Introduced by Rep. Dennis A. Ross, R-FL, the legislation would save $44 billion over 10 years but result in a 40 percent reduction in the guaranteed retirement of new federal employees. Among the proposed changes, the bill would require that current federal employees contribute more toward their retirements, end the current Federal Employees Retirement System (FERS) Annuity Supplement and change the high-three retirement computation formula to high-five for new hires.

At press time, H.R. 3813 was delayed in the House. One part of the bill, requiring new federal employees to contribute 2.3 percent more toward their retirement than current employees under FERS, was already used to fund the payroll-tax holiday and the extension of unemployment benefits. In addition, the overall legislation had been attached to the House version of a major highway bill. (See p. 24 for more information.)

Under the bill as approved by the committee, active federal employees would contribute 0.5 percent more toward their retirement over the next three years (a total increase of 1.5 percent). At the same time, the government’s share of contributions to the Civil Service Retirement and Disability Fund would be reduced by an equal amount.

New employees and those who have worked for the government for less than five years would be under new “Security Annuity Employees” rules and would see their retirement

STORY HIGHLIGHTS ■ A House committee approved a bill that would

require federal employees to contribute more to their retirements, end the FERS Annuity Supplement, and change the high-three retirement computation formula to high-five for new hires.

■ It was unclear at press time how or if the bill would proceed in the House. annuities reduced through a shift to a high-five instead of the current high-three average formula, and a new accrual rate in the retirement formula would be put in place.

H.R. 3813 includes a proposal to end the FERS Annuity Supplement, effective for retirements after December 31, 2012. One-third of an employee’s retirement under FERS is a Social Security benefit. Some FERS employees become eligible for retirement prior to age 62, when they can begin collecting Social Security. The supplement is the additional annuity FERS retirees may receive until they are eligible for the Social Security portion of their retirement benefits.

The legislation also would apply to members of Congress and congressional employees, and would bring their retirement formula in line with the rest of the federal community.

The final provision of the legislation would allow federal employees to contribute annual leave or vacation toward their Thrift Savings Plan account. Similar legislation supported by NARFE was introduced in 2010 but did not move.

By Sarah Holstine, Legislative Specialist

NARFE: Feds Are Being Singled Out For ‘Disproportionate Sacrifice’

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avid Snell, director of NARFE’s Retirement Benefits Service Department, represented the Federal-Postal Coalition at a January 25 House hearing. Citing cuts to federal retirement compensation to fund the payroll-tax holiday and the federal employee pay freeze, Snell said that recent legislative pro-

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posals unfairly single out federal workers for disproportionate sacrifice. “Apart from the personal toll,” he said, “these actions undermine the federal government’s ability to attract and retain the talent needed to deal with the challenges we all face as a country.”

The hearing, before the House Oversight and GovernAPRIL 2012 | NARFE

STORY HIGHLIGHTS ■ NARFE testified on behalf of the Federal-Postal

Coalition before a House subcommittee, saying the federal community is being unfairly singled out for sacrifice.

■ The Association said attacks on feds’ retirement compensation are a result of “misguided assumptions.” ment Reform Subcommittee on Federal Workforce, U.S. Postal Service and Labor Policy, continued the debate that has been taking place on Capitol Hill for more than a year: Are federal employees overcompensated, especially taking into account their retirement package?

Witnesses and several members of Congress argued that, as changes to private pension systems continue, the federal government must follow suit. NARFE testified that retirement for public- and private-sector employees is meant to provide income security while ensuring that retirees do not suffer a significant decline in their standard of living.

NARFE said attacks on federal employee retirement compensation are a result of misguided assumptions. These assumptions include that most private-sector 401(k) retirement plans provide adequate retirement income security; that federal retirement benefits are overly generous; that federal employees are overcompensated; and that Congress

David Snell, right, director of NARFE’s Retirement Benefits Service Department, testifies at a House hearing with, from left, Charles D. Grimes of the Office of Personnel Management; Andrew G. Biggs of the American Enterprise Institute; and Pete Sepp of the National Taxpayers Union. Subcommittee Chair Dennis A. Ross, R-FL, is visible in the video monitor.

should pursue policies that diminish federal retirement income security as opposed to working to improve privatesector retirement security.

To watch a webcast of the hearing, go to http:// oversight.house.gov and click on the date of the hearing, January 25.

NARFE-PAC Contribution Form

By Sarah Holstine, Legislative Specialist

Payment Information

I would like to make a monthly credit card contribution to Name: _____________________________________________ NARFE-PAC of: Monthly contributions qualify you to receive a Member ID# (if available): ___________________________ $10/month NARFE-PAC Sustainer lapel pin and the red, white Address: ___________________________________________ and blue NARFE umbrella. $25/month __________________________________________________ Other:______/month (minimum of $10) Check or money order enclosed -or-or(below; required for monthly contribution) I would like to make a one-time contribution of: Credit Card Card Type: MasterCard Visa Discover AMEX $100 (qualifies for Gold 2011-2012 NARFE-PAC lapel pin and NARFE umbrella)

$50 (qualifies for Silver 2011-2012 NARFE-PAC lapel pin)

$20 (qualifies for Basic 2011-2012 NARFE-PAC lapel pin, pictured here)

Card #: ____________________________________________ Expiration Date: ____ / ____ Name on Card: _____________________________________ Signature:__________________________________________

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

NARFE | APRIL 2012

Date: __________________ Please send check, money order or credit card information to: Attn: Budget & Finance / NARFE / 606 N. Washington St. Alexandria, VA 22314-1914

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Legislative Report

NARFE Testifies About Retirement Claims Processing Delays

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ARFE President Joseph A. Beaudoin testified before the Senate Homeland Security and Governmental Affairs Subcommittee on Oversight of Government Management on the backlog of retirement claims processing at the Office of Personnel Management (OPM). At the time of the hearing, OPM was struggling to manage a backlog of 48,375 claims; the average processing time was 156 days.

“This task is urgent,” Beaudoin said. “The effect of such long delays on new federal retirees is obvious and serious – they must ‘make do’ while waiting to receive the full amount they have earned. The wait is too long, and the uncertainty is too much, particularly in the current economy.”

During his February 1 testimony, Beaudoin related the individual stories of several NARFE members who are facing economic instability as a result of the delay in processing their annuities, including one member who received only $17 each month for nine months while she waited for her full annuity. Beaudoin reminded members of the committee that the situation impacts local communities across the country.

OPM Director John Berry said eliminating the current backlog is his highest priority this year. He shared his agency’s strategic plan for reducing the backlog, with a goal of ending it in 18 months. In addition to hiring more people to process claims, OPM is making overtime available, and improving productivity measurements and accountability. Berry noted that some of the delay is a result of problematic paperwork received from agencies upon an employee’s retirement. OPM will partner with agencies to reduce the paperwork problems. In addition, OPM is preparing to better use information technology, and reduce incorrect payments and those made to deceased employees.

Berry said three top officers at OPM will be responsible for the day-to-day operations and oversight of the initiative. Additionally, on the fifth day of each month, OPM will report the

NARFE COMMENDS OPM for recognizing the problem and developing a strategic plan to solve it.

14

NARFE President Joseph A. Beaudoin said new retirees face long waits and uncertainty while OPM struggles with a huge backlog of retirement claims. While the Association commended OPM for recognizing the problem and developing a plan to solve it, Beaudoin testified that NARFE is concerned that tight budgets could mean that the plan would not be fully implemented.

current backlog to members of Congress. This reporting will serve as a benchmark as OPM moves toward the goal of processing simple retirement cases within 60 days.

Currently, employees responsible for processing claims are able to spend only about 40 percent of their time on the actual processing of cases; they spend 30 percent responding to customer service calls and another 30 percent gathering materials to complete cases. OPM’s goal is to hire customer service specialists and additional employees to gather materials so that employees responsible for processing cases can spend all of their time doing that.

To speed processing of their cases, Berry encouraged fed-

STORY HIGHLIGHTS ■ NARFE President Joseph A. Beaudoin testified

before a Senate subcommittee that new retirees are waiting too long for OPM to process their retirement claim and award their full retirement annuity. The average processing time was 156 days.

■ OPM Director John Berry said eliminating the backlog is his top priority and outlined his plan to whittle it down, including hiring additional personnel, authorizing overtime and improving productivity measurements.

APRIL 2012 | NARFE

Legislative Report

Sen. Mark Warner displayed a chart that estimated that OPM’s cost for processing federal employee retirement claims is $1,134.38 per claim.

He based that estimate on dividing OPM’s fiscal year 2011 retirement services budget by the number of claims processed during that year.

eral workers who are preparing for retirement to go to their human resources office and review their files to make sure they are accurate and complete.

NARFE commended OPM for recognizing the problem

16ROC2098NARFEhalfAds.indd

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and developing a strategic plan to solve it. But Beaudoin also said that some concerns remain. First, as budgets continue to be constrained, the plans regarding additional staff may not be able to be fully implemented. NARFE recommended mandatory overtime, as opposed to voluntary. Further, to implement the plan successfully, OPM must enforce the new production standards and work very closely with agencies. Finally, Beaudoin noted the problems that annuitants have in communicating with OPM and encouraged improvements.

Prior to the hearing, Sen. Mark Warner, D-VA, met with NARFE representatives and several NARFE members from Virginia. Throughout the hearing, Warner encouraged OPM to work with NARFE on reducing the backlog. Warner also urged Berry to begin reporting the error rates of agencies sending cases to OPM in an effort to promote greater agency efforts to send accurate and complete files.

To watch a webcast of the hearing, go to the committee’s website at www.hsgac.senate.gov/. Click on “Subcomittees” at the top of the page, then “Oversight of Government Management.” Click on the February 1 hearing in the left panel.

By Sarah Holstine, Legislative Specialist

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Legislative Report CIVICS 101:

THE INFORMED CITIZEN

Redistricting Progress Report

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edistricting is the process of producing congressional districts of similar population following the constitutionally mandated decennial census and subsequent reapportionment. Forty-three of the 50 states – the states with two or more congressional districts – are in various stages of redistricting. Most states (33) have approved a redistricting map, but several (seven) have not. A few (three) are in the courts (see below). The seven states still in progress are: Arizona, Florida, Kansas, Kentucky, New Hampshire, New York and Rhode Island.

STORY HIGHLIGHTS ■ Redistricting goal is one person, one vote.

■ Reapportionment saw 18 states gain or lose a

congressional district or districts.

■ State legislatures are still the dominant force.

■ Maps are available through web gateways.

growth was not fast enough to earn more representation.

Even more dramatic, the commission established by ballot measure in 2008 has drawn many competitive districts.

LEGISLATURES REAPPORTIONMENT: 12 SEATS LOST AND GAINED Slower-than-average population growth resulted in lost seats in the House of Representatives in 10 states: Iowa, Illinois, Louisiana, Massachusetts, Michigan, Missouri, New Jersey, New York, Ohio and Pennsylvania. New York and Ohio are the only states to lose more than one seat. For the seventh consecutive reapportionment, New York lost more than one seat. Like Ohio, New York lost two seats. Eight states with faster-than-average growth gained seats. Six gained one: Arizona, Georgia, Nevada, South Carolina, Utah and Washington. Florida gained two; and Texas, four.

The most common process for redistricting is still the legislature. Thirty-six states allow state legislators, some planning to run for Congress, to draw the districts. State governors are players in this process in most, but not all, of these 36 states.

LITIGATION In three states, Connecticut, Minnesota and Texas, redistricting is in the courts. The delay in Texas has forced the postponement of the primary. These three states are examples of different “control” of the process. In Connecticut, Democrats control the process; in Minnesota, control is divided; and in Texas, Republicans are in control.

BACKGROUND In 2002, the last post-redistricting election, 382 of 398 House members who sought re-election won. An important reason for this 96 percent success rate was that district lines were tailored, often in the only surviving instance of bipartisanship, to their overwhelming advantage.

COMMISSIONS If war is too important to be left to generals, it seems that redistricting is too important to be left to politicians. One glance at maps drawn by, or at the behest of, powerful interests shows that elections can be turned on their head. Instead of voters selecting representatives, in too many cases incumbents select their voters. Partisan overreach can prompt citizen action.

Several states use a commission instead of, or in addition to, the legislature. New and notable among these is California.

For the first time since statehood, California’s population

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WHAT’S NEXT FOR NARFE Newly drawn district lines will mean that thousands of NARFE members will be in “new” districts, with a slight to dramatic difference in geography, demographics and politics.

House members will represent existing districts while seeking election in “new” districts. NARFE officers and members will have to wrestle with this duality, at least until the 113th Congress takes office in January 2013. This challenge is also a great opportunity for federations and chapters to invest in congressional district liaisons to help knit members in multiple chapters into a mean, lean advocacy machine.

There are two particularly good sources for maps and additional information. The National Conference of State Legislatures (www.ncsl.org) has collected state redistricting websites. Also, the Cook Political Report has a frequently updated gateway. Go to www.cookpolitical.com/node/10516.

By Christopher Farrell, Legislative Representative APRIL 2012 | NARFE

Legislative Report StateTaxTreatment of Federal Annuities –Tax Year 2011

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his roundup of state tax treatment of federal annuities and other tax information was compiled by the NARFE Legislative Department. The information also is available on the NARFE website,www.narfe.org.

STATES WITH NO PERSONAL INCOME TAXES Alaska Florida

Nevada New Hampshire1

South Dakota Tennessee2

Texas Washington

Wyoming

1 New Hampshire: Taxes interest/dividend income at 5% if it exceeds $2,400 (single) or $4,800 (couple).$1,200 exemption for residents age 65+.

2Tennessee: Taxes certain interest/dividend income at 6% if it exceeds $1,250 (single) or $2,500 (couple).

STATES EXEMPTING TOTAL AMOUNT OF CIVIL SERVICE ANNUITIES Alabama Hawaii Illinois

Kansas Kentucky1 Louisiana

Massachusetts Michigan Mississippi

New York North Carolina2 Oregon3

Pennsylvania Tennessee

1 Kentucky: Amount attributable to service prior to January 1,1998,is exempt.See below for taxation of annuities attributable to service on or after January 1,1998.

2 North Carolina: Annuities not taxed if the individual had five years of government service as of August 12,1989.If otherwise,see below.

3 Oregon: Annuities of those who retired before October 1, 1991, are not taxed. Those who retired after October 1, 1991, are taxed only on that portion of the annuity attributable to government service after October 1,1991.

OTHER EXEMPTIONS Note: SS=Social Security; RR=Railroad Retirement;AGI=Adjusted Gross Income;HH=Head of Household;MFJ=Married Filing Jointly; MFS=Married Filing Separately; QW=Qualified Widow(er); CSRS=Civil Service Retirement System;FERS=Federal Employees Retirement System;IRA=Individual Retirement Account ALABAMA: SS is exempt. Income from defined benefit pension plans is exempt.

ARIZONA: $2,500 exclusion for federal, military and Arizona state and local pension income. SS and RR exempt. Additional personal exemption for all residents age 65+.

ARKANSAS: Exempts up to $6,000 in federal civil service,military, in-state and out-of-state state or local government and private pension income. IRA distributions can be included as part of the exemption if the taxpayer is age 59-1/2+. SS and Tier 1 and Tier 2 RR benefits are exempt. Additional $23 exemption for residents age 65+.

CALIFORNIA: SS and RR are exempt. Additional $102 personal exemption for residents age 65+. Residents age 65+ with AGI below $65,153 who qualified as HH in 2009 or 2010 by providing a household for a qualifying individual who died during 2009 or 2010 may claim a tax credit of 2% of their income up to a maximum of $1,228. All private and public pensions are taxed. Additional 2.5 % tax on early distributions and qualified pensions.

COLORADO: $20,000 pension/annuity exemption for all taxpayers between the ages of 55 and 64. $24,000 pension/annuity exemption for all taxpayers age 65+.

CONNECTICUT: SS is exempt if federalAGI is $50,000 or less (if single or MFS),or $60,000 or less (if MFJ,HH or QW with dependent child). All out-of-state government and federal civil service pensions are fully taxed.Exempts 50% of federally taxable military retirement pay.

DELAWARE: Taxpayers age 60+ may exclude $12,500 of investment and qualified pension income (including out-of-state and fed-

20

eral government pensions) and qualify for an additional tax credit of $110. Taxpayers under age 60 may exclude $2,000. Taxpayers age 65+ (or blind) are entitled to an additional standard deduction of $2,500 (if not itemizing).Single or MFS taxpayers age 60+ as of December 31, 2010, or totally disabled, may exclude $2,000 if earned income is less than $2,500 and AGI is $10,000 or less.If MFJ and both spouses are age 60+ as of December 31,2010,or totally disabled,may exclude $4,000 if earned income is less than $5,000 and AGI is $20,000 or less.SS and RR are exempt.

DISTRICT OF COLUMBIA:Taxpayers age 62+ may exclude $3,000 of military,federal and DC government pensions.For taxpayers age 62+,DC or federal government survivor benefits are exempt from DC tax. Additional exemption of $1,675 for residents age 65+. SS is exempt.

GEORGIA: Taxpayers who are age 62+,or permanently and totally disabled regardless of age, may exclude $35,000 of retirement income if single or MFS,and $70,000 if MFJ (assuming both spouses qualify).Retirement income includes income from pensions and annuities, interest income, dividend income, net income from rental property, capital gains income and income from royalties. Up to $4,000 of the maximum allowable exclusion may be earned income.SS is exempt.For taxpayers age 65+, the retirement income tax exclusion will increase to $65,000 in 2012, $100,000 in 2013,$150,000 in 2014,$200,000 in 2015 and unlimited thereafter.

HAWAII: SS and Tier 1 RR benefits are exempt. Additional personal exemption of $1,040 per person age 65+.

IDAHO: SS and RR are exempt.Retirement benefits deduction available for CSRS annuitants who established CSRS eligibility prior to 1984, who are age 65+, or 62+ and disabled, in the amount of $27,876 (if single) or $41,814 (MFJ) minus SS and RR received. Persons using MFS status are not eligible for the retirement benefits deduction. Add $1,100 to standard deduction if age 65+ and MFS,MFJ or QW;add $1,400 if age 65+ and single or HH. ILLINOIS: SS and RR and income from any qualified employee APRIL 2012 | NARFE

benefit plan are exempt.

INDIANA:Taxpayers age 60+ may exclude $2,000 from military pensions minus the amount of SS and RR benefits received.

Taxpayers age 62+ may deduct from theirAGI $2,000 from a federal civil service annuity (survivor annuities not included).SS and RR benefits are exempt. Additional personal exemption of $1,000 or $1,500 if federal AGI is less than $40,000 for residents age 65+.May deduct from income premiums paid for long-term care insurance through the Indiana Partnership.

IOWA:Taxpayers age 55+ may exclude up to $6,000 (if single) or $12,000 (if MFJ) of pension or annuity income,self-employed retirement plan income, deferred compensation, IRA benefits or other retirement plan benefit income (not including SS). 67% of federally taxable SS benefits are excluded.RR benefits exempt but used to calculate amount of federally taxable SS benefits.

Additional $20 personal exemption credit for those age 65+.

later.Notably,federal civil service annuities will lose their current full exemption. For taxpayers born in 1946-1952, before the taxpayer reaches age 67,public and private pension income will be exempt only up to $20,000 (single) or $40,000 (MFJ),and no deduction will be allowed for interest,dividends and capital gains. After reaching age 67, taxpayers born in 1946-1952 will be allowed a $20,000 (single) or $40,000 (MFJ) subtraction against all income.For taxpayers born in 1953 or later,there will be no public or private pension exemption or interest,dividends and capital gains exemption before the individual reaches age 67.Once 67,those taxpayers may elect either to exempt up to $20,000 (single) or $40,000 (MFJ) without any exemption for SS, RR or military retirement and no personal exemptions,or they may elect to exempt SS,military and RR and claim personal exemptions.

Full details of the changes are available at www.michigan.gov/ documents/taxes/Tax_Change_Summaries_-_Retirement_ Exemptions_359799_7.pdf.

MINNESOTA: RR is exempt.

KANSAS: RR,military,in-state/local pensions are exempt.SS exempt if federalAGI is $75,000 or less;otherwise,only federally taxable benefits taxed. Additional $850 deduction for those age 65+.

MISSISSIPPI: Qualified retirement income (including civil service annuities and SS) is exempt. Additional exemption of $1,500 for residents age 65+.

KENTUCKY: All federal civil service and military retirement annuities attributable to service prior to January 1,1998,are excluded. Annuities attributable to service after January 1, 1998, are included as pension income,of which taxpayers may exclude up to $41,110.SS and RR benefits,Roth IRA proceeds exempt.

LOUISIANA: SS is exempt.Federal annuities are exempt.In addition, persons age 65+ may exclude up to $6,000 of annual retirement income from their taxable income. Taxpayers MFJ and both age 65+ can each exclude up to $6,000 of annual retirement income.If only one spouse has retirement income,the total exclusion is limited to $6,000.

MISSOURI:Taxpayers withAGI under $85,000 (single,HH,MFS, QW) or $100,000 (MFJ) may exempt the greater of $6,000 or 80% of any federal,state or local pension income,up to a maximum of $34,141 per taxpayer. Taxpayers withAGI under $25,000 (single, HH,QW) or $32,000 (MFJ) or $16,000 (MFS) may exempt $6,000 of private pension income. Taxpayers withAGI over these limits must reduce their private pension exemption dollar for dollar as income exceeds the limit. Taxpayers age 62+ or disabled with anAGI under $85,000 (single,HH,MFS,QW) or $100,000 (MFJ) may exempt 80% of the taxable amount of SS but must reduce their public pension exemption by the amount deducted for SS. Taxpayers may exempt 30% of military pension income.

MAINE: May deduct $6,000 of eligible pension income,including federal civil service annuity income,from federalAGI.Except for military income, the $6,000 deduction must be reduced for SS and RR benefits. Additional standard deductions:for individuals, $1,400 if age 65+; for MFS, MFJ or QW, $1,100 per spouse or person who is age 65+.

MONTANA:Taxpayers with AGI under $30,320 may exclude $3,640 of pension income;forAGI above $30,320,the pension income exclusion is reduced $2 for every $1 of AGI above $30,320.

RR benefits are exempt. Additional exemption of $2,040 if age 65+. Taxpayers age 65+ may exempt $800 of interest income reported as federal AGI or $1,600 if MFJ.

MARYLAND: If age 65+,may exclude up to $26,300 in pension income, reduced by SS or RR benefits. SS and RR are exempt.

Additional $1,000 exemption for residents age 65+. Additional $5,000 exemption for military retirement income received by an individual of any age or the surviving spouse or ex-spouse of the individual,if the individual was a member of an active or reserve component of the U.S. military, an active duty member of the commissioned corps of the Public Health Service, the National Oceanic and Atmospheric Administration, the Coast and Geodetic Survey,or a member of the Maryland National Guard.

NEBRASKA: Tier I and II RR benefits are exempt.

MASSACHUSETTS: SS is exempt.Additional exemption of $700 for individuals age 65+.

MICHIGAN: In-state,local and military pensions are exempt.SS and RR are exempt. Some out-of-state public pensions are exempt. Private pension income is exempt up to $45,842 (individual filers) or $91,684 (MFJ),reduced by the amount of any public pension deduction claimed. Taxpayers age 65+ may deduct interest, dividends and capital gains up to $10,218 (individual filers) or $20,437 (MFJ). Additional exemption of $2,300 for individuals age 65+. Significant changes to tax treatment of retirement income begin in tax year 2012 (returns filed in 2013) for taxpayers born in 1946 or NARFE | APRIL 2012

NEW JERSEY: Taxpayers age 62+ may exclude up to $10,000 (MFS), $15,000 or $20,000 (MFJ) of pensions, annuities and IRA withdrawals, provided gross income is not over $100,000. In addition, taxpayers age 62+ with earned income (from wages, net business profits,distributive share of partnership income and net pro rata share of S corporation income) of $3,000 or less, and with gross income not over $100,000, may exclude other nonpension retirement income up to the maximum exclusion amount.SS and RR benefits are exempt,reported as pension income. If ineligible for SS or RR, entitled to deduct an additional $3,000 (single,MFS) or $6,000 (MFJ,HH,QW).Military pensions are exempt. Additional $1,000 personal exemption for residents age 65+. If taxpayer can recover all civil service retirement contributions in the first three years, can use the three-year rule, in which annuities are not taxed until total employee contributions have been recovered. If not, must use the general rule method, in which a portion of annuity is excluded from taxation.

NEW MEXICO: Taxpayers age 65+ or blind may qualify for additional exemption of $8,000 if federal AGI is less than $15,000 (MFS), $18,000 (single) or $30,000 (MFJ, HH, QW).The exemp-

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Legislative Report tion reduces as income increases, with no exemption if income is over $25,500 (MFS),$28,500 (single) or $51,000 (MFJ).RR is exempt. If age 100+,exempt from state income tax,but only if centenarian cannot be claimed as a dependent by someone else.

NEW YORK: In addition to the exemption for pensions of New York state, local governments and the federal government, an additional pension and annuity income exclusion of up to $20,000 is available to persons age 59-1/2+ as of January 1,2010.

SS and RR are exempt.

NORTH CAROLINA: Pursuant to the North Carolina Supreme Court’s decision in Bailey v. State of North Carolina, state may not tax certain retirement benefits received by federal civil service and military retirees or retirees of the state of North Carolina and its local governments,if the retiree has five or more years of creditable service as of August 12, 1989. If retirees in those categories did not have five years of service as of August 12,1989,they may deduct the amount included in federal taxable income or $4,000, whichever is less.This deduction also applies to retirement benefits paid to former teachers and state employees of other states and their political subdivisions regardless of the five-year service date. If MFJ and both spouses received federal,state or local government retirement benefits,each may deduct up to a maximum of $4,000.If an individual’s federal taxable income includes retirement benefits from a private retirement plan,a deduction of up to $2,000 may be available.If an individual received both government and private retirement benefits, the maximum deduction is the total amount included in federal taxable income or $4,000, whichever is less. Taxpayers age 65+ receive an additional standard deduction of $750 (single) or $1,200 ($600 each for a couple if both age 65+).

NORTH DAKOTA:RR is exempt.May exclude 30% of net longterm capital gains and qualified dividends.

OHIO: General retirement income credit available in an amount starting at $25,if qualifying retirement income is at least $500,and maxing out at $200,if qualifying retirement income is $8,000 or more.Residents age 65+ are entitled to a $50 tax credit per return. Military pension income is exempt.Taxpayers who served in the military and receive a federal civil service retirement pension are eligible for a limited deduction if any portion of their federal retirement pay is based on credit for their military service. These retirees can deduct the percentage (in terms of years of service) of the amount of their federal retirement pay that is attributable to their military service. SS and RR are exempt.

OKLAHOMA: Each individual may exclude 100% of retirement benefits received from federal CSRS,including survivor benefits, paid in lieu of Social Security to the extent that these benefits are included in the federal AGI. Note: Retirement benefits paid under FERS do not qualify for this exclusion. However, for retirement benefits containing both a FERS and a CSRS component, the CSRS component will qualify for the exclusion. Individuals may exclude their federal civil service retirement benefits or Oklahoma state employment retirement benefits up to $10,000,but not to include the amount claimed under the CSRS exclusion above. Individuals may exclude the greater of 75% of their military retirement benefits or $10,000.SS is exempt.

OREGON: Taxpayers age 62+ may qualify for retirement income credit (see worksheet regarding line 34) or elderly tax credit (40% of federal credit),but may not claim both.SS and RR

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benefits are exempt. Additional standard deduction if age 65+ of $1,200 (single,HH),$1,000 each spouse 65+ (MFJ,MFS and QW).

RHODE ISLAND: RR is exempt.

January 1,1939,may claim an age deduction of $12,000 (available for each person or spouse if MFJ). If birthdate is on or between January 2, 1939, and January 1, 1947, the $12,000 age deduction is reduced by $1 for every $1 that adjusted federal AGI exceeds $50,000 (single) or $75,000 (MFJ,MFS). SS andTier I RR benefits are exempt. Additional personal exemption of $800 if age 65+ or blind.Long-term care premiums are eligible for deduction.

SOUTH CAROLINA: If below age 65, may deduct $3,000 of qualified retirement income. If age 65+, may deduct $10,000 of qualified retirement income. All individuals age 65+ are entitled to a $15,000 deduction from income,reduced by any deduction claimed for qualified retirement income.SS and RR are exempt.

WEST VIRGINIA: $2,000 of civil service and state pensions are exempt. Taxpayers age 65+ or surviving spouses may exclude the first $8,000 (single) or $16,000 (MFJ) of any retirement income. Additional modification for military pension income for the first $20,000.RR is exempt.

TENNESSEE: Tax applies only to certain interest and dividend income, not wages and salary or pension income. Any person age 65+ is tax-exempt if total annual income, from any and all sources,is $16,200 or less,or $27,000 or less for joint filers.

WISCONSIN: Federal retirement payments are exempt from state income tax if:1) individual retired from the system before January 1, 1964; 2) individual was a member of the system as of December 31,1963,retiring at a later date and the payments received are from an account established before 1964; or 3) individual is receiving payments from the system as a beneficiary (survivor) of an individual who met condition 1 or 2. If age 65+, may exempt up to $5,000 of retirement income if federalAGI is less than $15,000 or $30,000 (MFJ). Additional personal exemption of $250 if age 65+. SS and RR benefits are exempt. Military retirement pay and retirement pay related to service with the Coast Guard, the commissioned corps of the National Oceanic and Atmospheric Administration or the commissioned corps of the Public Health Service are exempt. ■

PENNSYLVANIA: Retirement income is not taxed after age 59-1/2.

UTAH:Taxpayers age 65+ may be entitled to a retirement credit of up to $450 ($900 MFJ),which is phased out at income levels of $25,000 (single) and $32,000 (MFJ). Taxpayers under age 65,born before January 1,1953,and with eligible retirement income may qualify for a credit up to 6% of eligible retirement income with a cap of $288, which is phased out starting at income levels of $25,000 (single) and $32,000 (MFJ).

VIRGINIA: Taxpayers age 65+ whose birthdate is on or before

STATE SALES TAX (DOES NOT INCLUDE CITY OR COUNTY ADD-ONS) Alabama* 4.0 % Alaska 0.0 Arizona*† 6.6 Arkansas* 1 6.0 California*† 7.25 Colorado*† 2.9 Connecticut*† 6.0 Delaware 2 0.0 Dist.of Col.*† 3 6.0 Florida*† 4 6.0 Georgia*† 4.0 Hawaii* 5 4.0 Idaho* 6.0 * Prescription drugs are exempt † Food is exempt

Illinois 6 Indiana*† Iowa*† Kansas* Kentucky*† Louisiana*† Maine*† Maryland*† 7 Massachusetts*† Michigan *† Minnesota*† 8 Mississippi* 9 Missouri* 10

6.25 % 7.0 6.0 6.3 6.0 4.0 5.0 6.0 6.25 6.0 6.875 7.0 4.225

Exemptions are not exhaustive. Gas and cigarette taxes are not included.

1 Arkansas: Taxes food at 1.5% 2 Delaware: Imposes a gross receipts tax on the seller of goods (tangible or otherwise) ranging from 0.1037% to 2.0736% 3 District of Columbia: Also exempts nonprescription drugs and residential utility services.Imposes different rates for liquor sold for off-thepremises consumption (10%);restaurant meals,liquor for consumption on the premises and rental vehicles (10%); parking motor vehicles in commercial lots (12%);and hotels or transient accommodations (14.5%) 4 Florida: Also exempts nonprescription drugs 5 Hawaii: Does not technically have a a sales tax but imposes a general excise tax of 4% of the gross receipts of most businesses 6 Illinois: Taxes qualifying food, prescription and nonprescription drugs,and medical appliances at 1% 7 Maryland: Also exempts nonprescription drugs 8 Minnesota: Also exempts nonprescription drugs 9 Mississippi: Additional exemptions and varied rates available at www.dor.ms.gov/taxareas/sales/main.html 10 Missouri: Taxes food at 1.225% 11 New Jersey: Also exempts nonprescription drugs, clothing and footwear NARFE | APRIL 2012

Montana Nebraska*† Nevada*† New Hampshire New Jersey*† 11 New Mexico 12 New York*† 13 N.Carolina N.Dakota*˜† Ohio*† Oklahoma* Oregon Pennsylvania*† 14

0.0 % 5.5 6.85 0.0 7.0 5.125 4.0 4.75% 5.0 5.5 4.5 0.0 6.0

Rhode Island*† 15 S.Carolina*† S.Dakota* Tennessee* 16 Texas*† 17 Utah* 18 Vermont*† 19 Virginia* 20 Washington*† West Virginia* 21 Wisconsin*† Wyoming*†

7.0 % 6.0 4.0 7.0 6.25 5.95 6.0 5.0 6.5 6.0 5.0 4.0

12 New Mexico: Does not have a sales tax but imposes a gross receipts tax instead, which has a similar effect, on persons engaged in business in New Mexico.In almost every case,the tax is passed to the consumer, either separately stated or as a part of the selling price.

Rate varies within the state from 5.125%-8.8675%. Deductions are available,including for prescription drugs and qualifying food sales.

13 NewYork: Also exempts nonprescription drugs 14 Pennsylvania: Also exempts nonprescription drugs, clothing, textbooks and heating fuels 15 Rhode Island: Also exempts nonprescription drugs 16Tennessee: Taxes food at 5.5% 17Texas: Also exempts nonprescription drugs 18 Utah: Includes a 1.25% tax levied by local governments. Taxes food at a state rate of 1.75% with local additions of up to 3% 19 Vermont:Also exempts nonprescription drugs, clothing and footwear,newspapers and residential utilities 20 Virginia: Includes statewide local tax of 1%. Taxes food for home consumption at 2.5%, which includes statewide local tax of 1%. Also exempts nonprescription drugs 21WestVirginia: Taxes food at 3%

23

By Julie Tagen, Legislative Director

INCE JANUARY, Congress has debated plans to cut federal employee paychecks and jobs to offset the costs of the payroll-tax holiday, a major highway bill and U.S. Postal Service reform, and to avoid cuts in the Pentagon budget.

So far, only one of the plans has become law. To resolve an impasse over how to fund a one-year extension of the payroll-tax holiday, a bipartisan House-Senate conference committee proposed – and Congress passed – a bill that requires new federal employees to contribute 2.3 percent more toward their retirement than current employees under the Federal Employees Retirement System (FERS).

Congress is considering additional measures that would have an impact on active federal employees. Retirees could be next. NARFE has mobilized its members, who have sent thousands of messages of protest to Congress. “The federal community believes in shared sacrifice,” said NARFE President Joseph A. Beaudoin, “but when will others share in the burden?”

NARFE does not expect the barrage of bills targeting the federal community to subside anytime soon. The following is a summary of where we stand now.

PAYROLL-TAX HOLIDAY HITS NEW FEDS On February 22, President Obama signed H.R. 3630, which requires federal employees hired after December 31, 2012, to pay 2.3 percent more toward their retirement, for a 3.1 percent total contribution to FERS. That assault on federal employees was enacted as a way to pay for extending the 2 percent payroll-tax cut for the NARFE | APRIL 2012

remainder of 2012, enacting another so-called “doc fix” that delays a scheduled 27.4 percent cut in Medicare reimbursements to doctors and continuing unemployment insurance for the long-term unemployed.

H.R. 3630 was hammered out in a House-Senate conference committee. Two members of the committee, Sen. Benjamin L. Cardin, DMD, and Rep. Chris Van Hollen, DMD, fought hard to exclude any harmful provisions for federal employees. NARFE reacted to passage of the bill in the House and Senate with a strong statement from Beaudoin: “It is wrong that our nation’s federal

workers continue to be the only group called on to make sacrifices.

Members of Congress must stop picking the pockets of America’s middle-class federal workers every time they need more funds.”

Since the “doc fix” runs out at the end of 2012, look for legislation to remedy that problem – and Congress will need to find some way to pay for it. Will active and retired employees be called upon to fund the fix?

HIGHWAY BILL ROLLS OVER CURRENT FEDS Just before Congress voted on the payroll-tax holiday bill in mid-Feb-

25

ruary, the House was preparing to vote on a bill that would: • Establish a new federal retirement system that would replace FERS for new federal employees and those who have not yet served the five years necessary to vest in FERS. Employees would pay 10.2 percent of their salary to the FERS defined benefit. Their annuity would be based on their highest five years of service (not the current highest three), and the annuity calculation would be based on a .7 percent multiplier (not the current 1.1 percent).

This amounts to a reduction of close to 40 percent from the current retirement benefit calculation.

• Require Civil Service Retirement System (CSRS) and FERS employees to contribute an additional 1.5 percent of their salary toward their retirement.

• Eliminate the FERS Annuity Supplement, except for those in age-based mandatory retirement positions such as law enforcement, starting in 2013.

These provisions, approved as H.R. 3813 by the House Oversight and Government Reform Committee, were rolled into a major highway bill, H.R. 7, as a way to help fund mass transit improvements. It was estimated that the changes to federal re-

tirement programs will save the government $45 billion over 10 years.

Within hours of the planned vote on the highway bill, however, the payroll-tax holiday conference committee came to an agreement and used $15 billion of the savings from H.R. 3813 to pay for the tax-cut extension. The action by the conference committee meant that the House would have to revisit how to pay for the highway bill, since the savings could not be used twice. House leaders chose to delay the vote. At press time, it was unclear if there would be any additional federal employee provisions in the highway bill.

PRESIDENT’S BUDGET TARGETS FEDS On February 13, President Obama sent his Fiscal Year 2013 Budget to Congress that counts on savings to the government obtained by increasing federal employee retirement contributions. Among other things, the president’s budget would: • Require CSRS and FERS employees to contribute an additional 1.2 percent of their salary toward their retirement; and • Eliminate the FERS Annuity Sup-

Protect America’s Heartbeat Rallies MemberAction

N

ARFE’s“ProtectAmerica’s Heartbeat” advocacy campaign continues to generate thousands of messages to members of Congress from NARFE members. From January 1 to February 23, NARFE members sent 52,889 email messages using the messaging capability of www.narfe.org and www.ProtectAmericasHeartbeat.org. NARFE members should check ProtectAmericasHeartbeat.org on a regular basis,NARFE Legislative Director JulieTagen advised. “Our targeted messages change frequently,depending on legislative activity.” She urged members to make sure NARFE has their email addresses on file so they receive alerts when messages change.

APRIL 2012 | NARFE

plement for new employees, except for those in age-based mandatory retirement positions.

These provisions would result in $27 billion in savings to the government over 10 years. On the other hand, the president’s budget called for a 0.5 percent increase in federal workers’ salaries. NARFE President Beaudoin noted that “the administration’s budget plan to modestly roll back the federal employee pay freeze by 0.5 percent this year will quickly be undone by the White House’s other plan to force middle-class federal workers to contribute 1.2 percent more of each paycheck to a retirement system that is already fully funded.”

The president’s budget provides a blueprint for Congress and sets forth the administration’s priorities for the fiscal year ahead (see story, p. 8).

POSTAL SERVICE REFORM INCLUDES STRIKE AT DISABLED FEDS At press time, the Senate was expected to act soon on a bill that would reduce, by 25 to 33 percent, compensation paid under the Federal Employees Compensation Act (FECA) to federal employees who are disabled from a work-related injury or illness when they reach retirement age. That provision is part of the Senate’s postal reform bill, S. 1789. NARFE opposes the workers’ compensation section of the bill because it does not adequately take into account the disadvantages in preparing for retirement faced by those employees unfortunate enough to suffer a debilitating injury or illness as a result of their public service.

While NARFE opposes the FECA provisions in S. 1789, the Association does support H.R. 2465, the Federal Workers’ Compensation Modernization and Improvement Act, which NARFE | APRIL 2012

passed the House in 2011. This bill “provides a thoughtful approach to reforming the federal workers’ compensation laws,” said Beaudoin. NARFE is urging the Senate to pass H.R. 2465 and oppose the FECA provisions of S. 1789.

PENTAGON PROTECTORS WOULD CUT FEDERAL WORKFORCE The final assault on the federal community comes from members of Congress concerned about the deep cuts to the Pentagon budget that would be required under the terms of the Budget Control Act – the 2011 deal that resulted from a compromise to increase the public debt limit. This budget “sequestration” would automatically cut the Pentagon budget by almost $500 billion in January 2013. Members of both the House and Senate have introduced bills to reduce the federal civilian workforce to avoid making these deep cuts in military spending.

Rep. Howard P. “Buck” McKeon, RCA, chairman of the House Armed Services Committee, introduced H.R. 3662, Down Payment to Protect National Security Act, which would prohibit a federal agency from hiring more than one employee for every three full-time employees who leave employment in an agency until the director of the Office of Management and Budget determines that the number of full-time federal employees has been reduced 10 percent. It allows a waiver of the workforce limitation by the president for national security reasons or in the case of an extraordinary emergency. Sens. Jon Kyl, R-AZ, and John McCain, R-AZ, have introduced S. 2065, the companion measure in the Senate. The Congressional Budget Office has not analyzed the bill to determine its cost savings. ■

Managing Money

Are International Stocks forYou?

By Mark A. Keen, CFP®

W

hen considering the debt issues plaguing Europe, the potential for global contagion, and the prospect of slowing economies in countries like China and Brazil, it’s easy to come to the conclusion that this is no time to be investing in international markets. In fact, stock markets around the globe had a tough time in 2011. The Morgan Stanley International EAFE (Europe, Australia, Far East) Index, which tracks large company stocks in developed foreign countries, dropped 12 percent, while once high-flying countries like China and Brazil both dropped more than 20 percent. Despite all this global turmoil, the U.S. stock market managed to eke out a small gain in 2011. This has many questioning the merits of international investing. Is it wise to ditch a global investment strategy for one with a home bias? I think not.

It never ceases to amaze me how fast attitudes change. It was only a few short years ago that the U.S. stock market appeared to be the world’s redheaded stepchild. International stock markets (including those of developed and emerging countries) were outperforming their U.S. counterpart, and U.S. investors reacted by pumping record amounts of money into foreign stocks. In fact, according to the Investment Company Institute, every new dollar that Americans have put into stock funds since 2007 has gone into funds that invest in international markets. As a result, the average American’s allocation to international stocks increased from 15 percent to 30 percent since 2001.

28

As is often the case, the money didn’t really start flowing into foreign stocks until after much of their relative outperformance took place. Unfortunately, the poor results of this return-chasing, rearview-mirror investing have been well documented.

And now, after developed international stocks have trailed their U.S. counterparts for the past few years, and emerging markets proved that they, too, can drop, investors are ready to flip-flop.

Despite global current events and recent performance, the case for investing internationally remains strong.

Globalization is creating growth and investment opportunities outside the United States. The United States accounts for less than half of the world’s stock market capitalization, compared to 66 percent in 1970. Anyone who limits his or her investments to the United States only is missing out on investing in more than half the world’s companies. In fact, according to the World Federation of Exchanges, there are 50 countries outside the United States with more than 40,000 publicly traded securities in which to invest.

Furthermore, certain major industrial sectors have become dominated by companies located outside U.S. borders. For example, 91 percent of the

world’s market capitalization for construction materials and 80 percent of mining and metals are located outside our borders. Bottom line: Looking outside the United States provides the opportunity for an expanded investment universe, which is an opportunity to further diversify a portfolio.

It’s the potential diversification benefit that is perhaps the single greatest reason to include international investments in a portfolio. The problem is that we have a tendency to overdo a good thing. So then, how much of a portfolio should be allocated to international stocks to maximize the diversification benefit?

Just because more than half of the world’s stocks are located outside the United States doesn’t mean that you need to allocate more than half your stocks to international companies. A recent study by Vanguard, analyzing the returns of U.S. and international stocks over the past 40 years, shows that risk (as measured by volatility) decreases and incremental return increases when international stocks are added to a U.S. portfolio. The study also found that the diversification benefit diminishes as the international stock allocation exceeds 40 percent of a stock portfolio. In fact, according to Vanguard, a 30 percent allocation to international stocks over the past 40 years would have been suf-

LOOKING OUTSIDE the United States provides the opportunity for an expanded investment universe.

APRIL 2012 | NARFE

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Mark A. Keen, CFP®, is president and owner of Bennett Financial Advisors, 3600 Chain Bridge Rd., Fairfax,VA, and an investment adviser representative and registered principal of The Strategic Financial Alliance, Inc. (SFA).

Securities and advisory services are offered through SFA. E-mail: mkeen@tributaryadvisors.com.

NARFE | APRIL 2012

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ficient and would have served you well.

With the plethora of mutual funds and low-cost index funds, investing in international stocks has never been easier. Start your international investing with a core fund that tracks a broad index of stocks in developed countries, such as the Fidelity Spartan International Index fund or the I Fund in the Thrift Savings Plan. You’ll want to complement your core fund with a fund that invests in emerging countries. A good option is the Vanguard Emerging Markets Stock Index fund.

Yes. Emerging market stocks have produced huge gains since 2000, but don’t overdo it – they also are riskier and can make your international portfolio more volatile.

There are additional risks involved when investing internationally, and past performance is not a guarantee of future results. Risks associated with international investing include political and economic instability, increased volatility and currency risks.

That said, an allocation to international investments should be long term and driven by historical diversification benefits (and your own personal tolerance for the additional risks associated with international investing), rather than recent performance. Do yourself a favor and stay grounded in a long-term investment strategy that includes both U.S. and international investments.

IMPORTANT CONSUMER INFORMATION: Jitterbug is owned by GreatCall, Inc. Your invoices will come from GreatCall. All rate plans and services require the purchase of a Jitterbug phone and a one-time set up fee of $35. Coverage and service is not available everywhere. Other charges and restrictions may apply. Screen images simulated. There are no additional fees to call Jitterbug’s 24-hour U.S. Based Customer Service. However, for calls to an Operator in which a service is completed, minutes will be deducted from your monthly balance equal to the length of the call and any call connected by the Operator, plus an additional 5 minutes. Monthly rate plans do not include government taxes or assessment surcharges. Prices and fees subject to change. 1We will refund the full price of the Jitterbug phone if it is returned within 30 days of purchase in like-new condition. We will also refund your first monthly service charge if you have less than 30 minutes of usage. If you have more than 30 minutes of usage, a per minute charge of 35 cents will apply for each minute over 30 minutes. The activation fee and shipping charges are not refundable. Jitterbug is a registered trademark of GreatCall, Inc. Samsung is a registered trademark of Samsung Electronics America, Inc. and/or its related entities. Copyright © 2012 GreatCall, Inc. Copyright © 2012 by firstSTREET for Boomers and Beyond, Inc. All rights reserved.

29

LiveWell

It’s All in the Hips

By Marilyn S. Radke, M.D.

A

ccording to the American Academy of Orthopaedic Surgeons, more than 285,000 total hip replacements are performed each year in the United States. The first procedure was performed in 1960. Since then, improvements have been made in technique and technology, and the effectiveness of hip replacement surgery has increased.

The most common reason for hip replacement is joint damage that causes pain and interferes with daily activities, despite treatment. Medical conditions that damage the hip joint include: • Osteoarthritis – joint pain and stiffness from wear and tear; • Rheumatoid arthritis – chronic inflammatory joint pain, stiffness and swelling; • Osteonecrosis – bone tissue death caused by insufficient blood supply; and • Injury, fracture and bone tumors.

If exercise, oral medication and joint injection do not relieve pain and improve joint function, your doctor may suggest a less complex corrective surgery (such as osteotomy) before proceeding to hip replacement.

The hip joint is a ball-and-socket joint located where the upper end of the thigh bone (femur) meets the hip bone (pelvis). A ball at the top of the femur (femoral head) fits in a socket (acetabulum) in the pelvis to allow a wide

30

range of motion.

Osteotomy involves cutting and realigning the bones of the acetabulum and/or femoral head to shift the weight from a damaged and painful bone surface to a healthier one. Recovery time is six to 12 months. Hip joint function may continue to worsen, and additional treatment may be needed. The length of time before another surgery is

ment. A metal ball is placed on top of the stem to replace the femoral head and complete the prosthetic hip joint.

Cemented parts are attached to healthy bone with special glue (cement).

Cemented replacements are used more often for older, less active people, and people who have weak bones or osteoporosis. Uncemented parts have a porous surface that allows your own

THE MOST COMMON reason for hip replacement is joint damage that causes pain and interferes with daily activities,despite treatment. needed depends on the condition of the joint before the osteotomy.

Hip replacement surgery involves removing the femoral head and acetabulum, and replacing the ball-and-socket mechanism of the hip with artificial parts (prostheses). The metal and plastic materials of the prosthesis allow a natural gliding motion of the joint.

Traditional hip replacement surgery takes one to two hours and involves a six- to 12-inch incision over the side of the hip through the muscles. The muscles are split or detached from the hip, and the joint is opened. The surgeon removes the femoral head from the thigh bone as well as the diseased bone tissue and cartilage from the hip socket. A cup-shaped implant is pressed into the bone of the socket and may be secured with screws. A smooth surface of plastic is inserted into the implant so the joint can move freely. A metal stem is implanted about six inches deep into the femur, either with or without bone ce-

bone to grow into the pores and hold the new parts in place. Uncemented replacements are used more often for younger, more active people. Activities must be limited for up to three months while the bone grows into the prosthesis, and post-surgical thigh pain is common as the bone attaches.

Usually, a three-to-five day hospital stay is required after surgery, and full recovery takes three to six months. A

To Learn More

F

or more information, write to the National Institute of Arthritis and Musculoskeletal and Skin Diseases,Information Clearing House,National Institutes of Health, 1AMS Circle,Bethesda,MD 208923675;or call 877-226-4267 (TTY:301565-2966); or visit the website at www.niams.nih.gov.

APRIL 2012 | NARFE

F

va G REE lue IF da T t$ 35

Marilyn S. Radke, M.D., is board certified in preventive medicine and practices in Atlanta, GA. NARFE | APRIL 2012

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physical therapy program is needed for safe range-of-motion activities and muscle-strengthening exercises, and to learn proper techniques for daily activities to prevent injuring the new hip.

The newer “minimally invasive” hip replacement surgery requires one or two smaller incisions and a shorter recovery time than traditional hip replacement. Candidates for this type of surgery are usually age 50 or younger, of normal weight based on body mass index and healthier than candidates for traditional hip replacement. The procedure may take longer to perform than traditional hip replacement surgery.

Complications of hip replacement include: • Hip dislocation (usually due to pulling the knees up to the chest); • Inflammatory reaction to tiny particles that wear off of the artificial joint surfaces and cause the implant to loosen (requires treatment with anti-inflammatory medication or with difficult, “revision” surgery to replace the artificial joint); and • Infection, blood clots and bone overgrowth.

Hip replacement may be problematic for people who have: • Chronic disorders, such as Parkinson’s disease; • Conditions that result in severe muscle weakness; • High risk for infection; • Advanced joint deterioration; and • Poor general health.

Activities that can damage the new hip include basketball, jogging and tennis. Recommended activities include walking, stationary bicycling, swimming and cross-country skiing.

“My Medical Alarm saved my life 3 times!

Copyright © 2011 by firstSTREET for Boomers and Beyond, Inc. All rights reserved.

31

Questions & Answers NOTE: The following Questions & Answers were compiled by Retirement Benefits Service Department staff. These are real questions received by the Department and real answers, based on the members’ personal circumstances.

The answers are not universal and may include information that is relevant to the correspondent’s particular situation. NARFE does not provide legal advice or assistance, does not provide financial planning advice or assistance, and does not provide tax advice or assistance. For legal, financial planning or tax advice/assistance, NARFE recommends members contact an attorney, financial planner or certified public accountant/tax adviser.

ACTIVE EMPLOYEES REDEPOSITS QUESTION: With the way the economy is going, I have decided to postpone my federal retirement.But I would like to know the maximum retirement benefit that I could receive.I am under the Civil Service Retirement System (CSRS).

Response: The basic CSRS annuity cannot exceed 80 percent of your highthree average salary, excluding your unused sick leave. Generally, you reach the 80 percent limitation when you have 41 years and 11 months of service.

Fewer years of service may result in a computation that produces the maximum benefit under special computation formulas, such as for law enforcement personnel.

Your service beyond the years that provide the maximum benefit will not

32

be used to compute your annuity. Instead, the Office of Personnel Management (OPM) will automatically refund the retirement contributions you made during those additional years; however, if you have federal civilian employment periods when you did not contribute to the CSRS, OPM would automatically apply excess contributions toward any deposit due for these employment periods.

PRERETIREMENT INFO QUESTION: How can I arrange for preretirement counseling in my area?

Response: Contact your agency’s benefits officer. A complete list of benefits officers by agency can be found on the Office of Personnel Management’s website at apps.opm.gov/abo/.

REDEPOSITS QUESTION: I previously made retirement redeposit payments.

How can I get a statement showing how much I paid and how much I still owe?

payments to new retirees within a month of receiving their retirement records from agencies. These are estimated payments based solely on the information provided by agencies and are not intended to be retirees’ full annuity payments. These payments represent a portion of the final benefit intended to provide retirees with an income and are sent on the first business day of each month. Because of an unusually large backlog of new retirement cases at OPM, the average time to complete processing of a new retirement claim (not including disability retirements, which often take much longer) under the Civil Service Retirement System or the Federal Employees Retirement System is more than five months.

COURT-ORDERED BENEFITS QUESTION: What benefits can be affected by a court order?

Response: Federal retirement law recognizes state court orders related or incidental to a divorce or legal separation agreement. If the Office of Personnel Management receives such a state court order acceptable for processing under its rules and regulations, the agency must comply with the order’s provisions, which could do any or all of the following to your retirement benefits: • Divide your civil service annuity; • Divide a refund of your retirement contributions made when you leave federal service before retirement; • Permit your ex-spouse to enroll in a health insurance plan under the Federal Employees Health Benefits Program; • Require you to assign your life insurance; • Garnish your annuity to pay al-

QA &

Response: Send your request by email to screceipts@opm.gov and a response will be returned by email. Be sure to include your name, date of birth and civil service deposit claim number.

ANNUITY PAYMENTS QUESTION:When can I expect to receive my first annuity payment from the Office of Personnel Management (OPM) after I retire? I understand that there have been major delays in payments.

Response: There are no delays in interim payments to new retirees, but there are significant delays at OPM in completing retirement cases. In almost all situations, OPM provides interim

APRIL 2012 | NARFE

N

imony; child support; in cases involving child abuse; or for Chapter 13 bankruptcy; • Award life insurance; and • Award a survivor’s benefit.

WEP QUESTION: How can I get an estimate of the amount of the reduction in my Social Security benefits due to the Windfall Elimination Provision (WEP)?

Response: You can request a statement by calling the Social Security Administration (SSA) and asking for form SSA7004, “Request for Social Security Statement.” The form also can be downloaded from the SSA website at www.ssa.gov. You also can use the Retirement Estimator at www.social security.gov/planners to find out how much you might receive. To find out how the WEP affects your Social Security benefits, go to www.social security.gov/gpo-wep and use the WEP online calculator. For more information or to make an appointment to visit your local SSA Office, contact the SSA at 800772-1213.

INTERIM ANNUITY WITHHOLDINGS QUESTION: When I retire, will any deductions be made in my interim payments until my retirement claim is processed?

Response: The Office of Personnel Management (OPM) only withholds federal income tax from interim payments. You may find that the federal income taxes withheld from your first interim payment will be higher than the federal tax withholdings from subsequent interim payments and your regular annuity. If you are eligible to continue health and life insurance coverage, that coverage will continue while you are receiving interim pay, even though premiums are NARFE | APRIL 2012

not withheld. After OPM completes adjudication of your retirement claim, you will receive what is termed a “makeup” payment, which covers the period from the effective date of your retirement to the end of that month. The payment represents the gross annuity you actually were entitled to during the interim payments, less the gross annuity you received as interim payments, and less the accrued health and life insurance premiums that should have been deducted since your retirement. Often, new retirees focus only on the difference between the interim gross annuity and the gross amount they believe they should have received. This leads them to anticipate receiving a much larger makeup check without taking into account the accrued deductions, such as health and life insurance premiums, that reduce the net amount of the payment.

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RETIREES ANNUITY DEDUCTIONS QUESTION: My accountant is unclear about the withholdings that can voluntarily be deducted from my federal annuity. Would you please provide them?

Response: You can voluntarily withhold federal and state income taxes, checking and savings allotments, or allotments to other participating organizations.

Federal Income Tax: Generally, unless you specify a monthly withholding rate or amount, the Office of Personnel Management (OPM) withholds federal income tax as though you were married and claiming three allowances. You can contact OPM by phone or in writing to change your withholding amount. If you write, your letter should include your claim number and the monthly amount in dollars that you want withheld. OPM also will send you, on request, form W-

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Questions & Answers 4P-A, “Election of Federal Income Tax Withholding,” and instructions for making the change. The change in your withholding will be made after OPM receives form W-4P-A. The easiest way to make changes to your federal tax withholding is to use OPM’s Retirement Services Online at www.opm.gov. You will need your OPM-provided personal identification number to access your records.

If you need more information or assistance in determining whether you are having the right amount of federal income tax withheld, visit the Internal Revenue Service website, www.irs.gov, or call 800-829-1040.

State Income Tax: You must specify the dollar amount of state tax you want withheld from your monthly payments. The withholding must be in whole dollars. The minimum amount of withholding for state income tax is $5. Again, you can either call or write, or make the designation online on the OPM website. If you do not know the monthly amount you want withheld, contact your state tax office for information or assistance.

Allotments to Organizations: You can start, change or stop an allotment to participating organizations. OPM’s list of participating organizations includes: • American Federation of Government Employees; • Fraternal Order of Retired Border Patrol Officers (Museum); • National Association of Postmasters of the U.S. Political Action Committee; • National Rural Letter Carriers Association Political Action Committee; • National Treasury Employees Union; • Northwest Plan Administrators; and • Treasury Employees Political Action Committee.

34

NARFE SERVICE OFFICERS are available to answer questions and to assist in helping with a variety of benefit matters. Check your chapter newsletter for the name and phone number of your service officer. Call NARFE toll-free at

800-456-8410 for the nearest service officer. NARFE Service Centers are also available in some areas. Use the Service Center listings on the NARFE website, www.narfe.org.

Recurring membership payments to organizations such as NARFE are done through the dues-withholding application authorization submitted on your behalf by NARFE. Checking and Savings Allotments: These allotments are voluntary deductions for allotments sent by direct deposit to a checking or savings account in your name. You can have up to two allotments. The accounts must be maintained at a domestic financial institution. These allotments do not include deductions for charities, savings bonds, garnishments or other court orders, or union or other organizational dues. You must maintain a net annuity payment of at least $100, and the allotment must be for a minimum of $50.

waiver of the consent requirement.

After the 30-day period has passed, you can change your election only under the following circumstances: If it is more than 30 days from the date of your first regular monthly payment but less than 18 months from the beginning date of your annuity, you can change your decision not to provide a survivor’s annuity, or you can increase the survivor’s annuity amount. You must request the change by writing to: Office of Personnel Management, Retirement Operations Center, P.O. Box 45, Boyers, PA 16017.

After 18 months, you cannot make a change in your election to provide a survivor’s annuity.

QUESTION: What are the procedures for changing my survivor’s benefit election after retirement?

DIRECT DEPOSIT QUESTION: I would like to change my direct deposit to my credit union instead of my bank. How do I process a direct deposit change?

Response: If your retirement is within 30 days of your first regular annuity payment, you can file a new election in writing to the Office of Personnel Management (OPM). Send it to: Office of Personnel Management, Retirement Operations Center, P.O. Box 45, Boyers, PA 16017.

Your first regular monthly payment is the first one paid in an amount other than the estimated amount or the adjustment payment after OPM has computed your regular annuity amount. If you change your election to anything other than the maximum, you must obtain your spouse’s consent or a

Response: There are several ways to make changes with the Office of Personnel Management (OPM). You can call OPM at the main retirement information number (888-767-6738) and provide your new bank name, address, account number and routing number. You also can go online at www.opm.gov/retire and use OPM’s Retirement Services Online at www.servicesonline.opm.gov. You will need your OPM-provided personal identification number to access your account. Your new financial institution also can submit standard form 1199A, “Direct Deposit Sign-Up Form,” to OPM on your behalf. You should contact your

SURVIVOR’S ELECTION

APRIL 2012 | NARFE

new financial institution for assistance in getting the routing number if you are not sure what it is. When you make a change, OPM will mail you confirmation of the change.

It is very important that you keep your old account open until a payment is posted to your new account. This will prevent having the payment returned if there is a problem with the new account.

FEGLI QUESTION: I think my Federal Employees’ Group Life Insurance (FEGLI) amount will be reduced when I turn age 65.Please provide information on how it is reduced.

Response: If you retired before December 9, 1980, your Basic life insurance will be reduced by 2 percent of the face value each month, beginning with the second month after your 65th birthday or your retirement date, whichever is later. This reduction continues until your Basic life insurance reaches 25 percent of the face value.

This coverage is free.

If you retired on or after December 9, 1980, you would have elected one of the following reduction schedules for your Basic life insurance: • 75 percent reduction: If you elected this reduction schedule, your Basic life insurance would begin to reduce by 2 percent of the face value each month, beginning with the second month after your 65th birthday or your retirement date, whichever is later. This reduction continues until your Basic life insurance reaches 25 percent of the face value.

This coverage is free. • 50 percent reduction: If you elected this reduction schedule, your Basic life insurance would begin to reduce by 1 percent of the face value each month, beginning with the NARFE | APRIL 2012

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Questions & Answers

The invention of the year is great news for your ears Perfect Choice HD™ is easy to use, hard to see and costs far less than hearing aids… it’s like reading glasses for your ears™!

NEW

New Personal Sound Amplification Product is an affordable alternative Over the years, technology has made the way we live easier, safer and more convenient. In many cases, it’s even made many products more affordable… (remember how much the first VCRs used to cost?). Unfortunately, the cost of hearing aids never seemed to come down. Now, a new alternative has been invented… it’s called Perfect Choice HD™.

“Reading glasses for your ears” Perfect Choice HD is NOT a hearing aid.

Hearing aids can only be sold by an audiologist. In order to get a hearing aid, you had to go to the doctor’s office for a battery of tests and numerous fitting appointments.

Once they had you tested and fitted, you would have to pay as much as $5000 for the product. Now, thanks to the efforts of the doctor who leads a renowned hearing

Affordable, Simple to use, Virtually impossible to see

ear… only you’ll know you have it on. It’s comfortable and won’t make you feel like you have something stuck in your ear. It provides high quality audio so sounds and conversations Perfect Choice HD vs Traditional Hearing Aids will be easier to hear Perfect Choice HD Traditional Hearing Aids and understand.

Lightweight and Inconspicuous Easy Toggle Switch Adjustment Intelligent Setting Memory Tests and Fittings Required

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institute, there is Perfect Choice HD. It’s designed to accurately amplify sounds and deliver them to your ear. Because we’ve developed an efficient production process, we can make a great product at an affordable price. The unit has been designed to have an easily accessible battery, but it is small and lightweight enough to hide behind your

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Try it for yourself with our exclusive Few home trial. Some Few people need hearing aids but many just Yes need the extra boost as much as $5000 in volume that a PSAP gives them. We rarely want you to be happy with Perfect Choice HD, so we are offering to let you try it for yourself. If you are not totally satisfied with this product, simply return it within 60 days for a refund of the full product purchase price. Don’t wait… don’t miss out on another conversation… call now!

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CHANGE OF ADDRESS QUESTION: I have moved to Florida for the next few months.How do I report a change in my mailing address?

Response: You can call the Office of Personnel Management (OPM) at 888-7676738 to report the change. If you call OPM, it is always advisable to have your CSA claim number when calling.

You also can go to OPM’s website, www.opm.gov, and use OPM’s Retirement Services Online (www.services online.opm.gov) to make the change yourself. You will need to use your OPM-provided personal identification number to access your records.

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second month after your 65th birthday or your retirement date, whichever is later. This reduction continues until your Basic life insurance reaches 50 percent of the face value. The Office of Personnel Management (OPM) withholds premiums for this coverage from your annuity, beginning at retirement and continuing for life.

• No Reduction: If you elected this reduction schedule, the full amount of your Basic life insurance would remain in force after you reach age 65. OPM withholds premiums for this additional coverage from your annuity, beginning at retirement and continuing for life.

For additional information on other optional insurance under FEGLI, go to www.opm.gov/insure.

QUESTION: I have submitted a form to suspend my health insurance because I am eligible for Medicare and will be using TRICARE as secondary payer. When can I expect the insurance payments to no longer be taken from my retirement annuity?

Response: You may suspend your Federal Employees Health Benefits ProAPRIL 2012 | NARFE

Technology Breakthrough

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Safe, comfortable bathing from Jacuzzi®

Enjoy A Bath Again… Safely and Affordably gram (FEHBP) coverage if you are enrolled in TRICARE or TRICARE For Life.

We are not in a position to advise on when your request would be processed by the Office of Personnel Management (OPM). However, when OPM approves your request, it will refund to you the FEHBP premiums that were withheld after the effective date of your request.

Correction

O

ur response to a question posed in the February issue’s Question & Answer section was in error. In the Q&A titled “Family Member Definition,” p.38,we should have said that eligible family members for family coverage purposes under the Federal Employees Health Benefits Program include: • Spouses; • Dependent children under age 26,married and unmarried,including legally adopted children and recognized natural (born out-of-wedlock) children; • Dependent stepchildren and foster children under age 26,married and unmarried, if they live with the enrollee in a regular parent-child relationship; and • Dependent children age 26 or older, married and unmarried, who are incapable of self-support because of physical or mental incapacity that existed before their 26th birthday.

NARFE regrets the error.

NARFE | APRIL 2012

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Unlike traditional bathtubs, our Designed for Seniors™ Walk-In Tub features a leakproof door that allows you to simply step into the tub rather than stepping precariously over the side. It features a state-of-the-art acrylic surface, a raised seat, and the controls are within easy reach. No other Walk-In Tub features the patented Jacuzzi® PointProTM jet system.

These high-volume, low-pressure pumps feature a perfectly balanced water to air ratio to massage thoroughly yet gently.

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NARFE: Our Best Bet for the Future

32nd National Convention RENO-SPARKS, NV AUG 26-30, 2012

OPM Director Berry, Journalist Causey Will Be Featured Speakers

J

ohn Berry, director of the Office of Personnel Management (OPM), will speak at the NARFE National Convention, delivering the keynote address on Monday, August 27. Noted print and radio journalist Mike Causey also will speak, at a date and time to be determined.

Berry was named OPM director in 2009 and is responsible for recruiting, hiring and setting benefits policies for the 1.9 million federal civilian employees. His department also processes federal civilian retirements and admin-

isters the two major federal retirement programs.

Causey is senior correspondent at Federal News Radio. Prior to joining the on-air and online station, Causey spent

CONVENTION DEADLINES The following deadlines have been established for the 2012 Convention.Details on all of these deadlines and other convention information are available at www.narfe.org. Sign in as a member and click on the 2012 Convention logo.

Candidate Statements: April 1 for June issue of NARFE magazine, May 1 for July issue (see statements,p.40 of this issue)

Comments Due

D

eadline for comments on the proposed revision to NARFE’s Bylaws is March 31. The proposal was published in the March issue and is online at www.narfe.org. Send comments to brc@narfe.org or, by postal mail, to MaryWilliams, Bylaws Revision Committee chair, at NARFE HQ. John Berry

Mike Causey

HOTEL RESERVATIONS Hotel reservations may be made by phone with the convention hotel (to get the NARFE rate,you must mention the NARFE Convention) or online at www.januggetsecure.com/jump/1190/.

JOHN ASCUAGA’S NUGGET CASINO RESORT 1100 Nugget Ave. Sparks, NV 89431 800-648-1177 - www.janugget.com

Resolutions: No later than May 15

HOTEL RATE: $95 single/double + 13.5% county tax. Triple and quad occupancy rates are an additional $10 per person over the quoted rate. Rates apply three days before and three days after the arrival and departure dates, based on availability.

Delegate Form: June 30

PARKING: Valet and self-parking;rate included in the $3 per room per night resort fee.

Proxy Form: August 11 Registration: Postmarked by August 2

38

more than 30 years at The Washington Post, where he wrote “The Federal Diary” column.

RESERVATION CUTOFF DATE: July 20 CHECK-IN: 3 p.m.

CHECK-OUT: 11a.m.

APRIL 2012 | NARFE

NARFE 2012 NATIONAL CONVENTION PREREGISTRATION FORM NARFE ID #:

32ND NATIONAL CONVENTION August 26-30, 2012 PLEASE CHECK: ■ (Guest) Member ■ (Guest) Nonmember

Name:

■ Delegate* ■ Delegate-at-Large* ■ Alternate*

*NOTE: This is NOT a voter registration form. Voter registration is confirmed by your chapter on Form C/12-2.

Address:

Mail Preregistration Form to: NARFE, Treasurer’s Office 606 N. Washington St. Alexandria, VA 22314-1914

Name for badge: Chapter #:

■ A nonrefundable fee of $65 (payable to NARFE) must accompany this form.

■ Onsite registration fee will be $80 in Reno-Sparks.

■ Each attendee must complete a separate registration form.

■ Form must be postmarked by August 2, 2012.

Location:

■ Charge to my credit card

Notify in case of emergency:

Card type: ■ MasterCard ■ Visa ■ Discover ■ AMEX

Name:

Card# __________________________________________ Phone Number:

Expiration Date_______ / _______ (mm) / (yy)

Name on card (Print) _______________________________ Signature ________________________ Date __________

Form C/12-4

BANQUET RESERVATION FORM August 30, 2012

32ND NATIONAL CONVENTION August 26-30, 2012 ■ Tables will be assigned on a first-come, first-served basis.

Tables seat 10 people.

■ RESERVATIONS LIMITED TO 2,000 PEOPLE. ■ Groups wishing to sit together should submit only one request specifying number of seats desired. Please attach name list.

■ A receipt will be mailed to you by August 2 acknowledging payment and showing your table assignment.

■ All banquet tickets will be held for pickup at the convention registration area at John Ascuaga’s Nugget Casino Resort.

■ BANQUET REFUNDS AVAILABLE ONLY IF RESERVATIONS ARE CANCELLED 72 HOURS PRIOR TO THE BANQUET.

NARFE ID #: Name: Address:

Chapter #: Nonmember Guest: Please reserve _____ tickets at $50 each, total $_____.

■ Charge to my credit card Card type: ■ MasterCard ■ Visa ■ Discover ■ AMEX

Make check payable to NARFE and send to: NARFE, Treasurer’s Office 606 N. Washington St. Alexandria, VA 22314-1914

Card# __________________________________________ Expiration Date_______ / _______ (mm) / (yy)

Name on card (Print) _______________________________ Signature ________________________ Date __________

Form C/12-16

CANDIDATES’ STATEMENTS NARFE NATIONAL ELECTIONS JOSEPH A. BEAUDOIN Candidate for National President

I

n 2010, I was honored when you elected me to NARFE’s highest office, your National President.

During the past 26 years, I have served as a NARFE officer at various levels: Chapter, Federation, Region X, and as the NARFE VP and National President.

At the National Conventions, I served as Chair of the Credentials Committee in 2002 and Chair of the Bylaws Committee in 2004 & 2006. In 2003, I was appointed Chair of the National Communications Advisory Committee (NCAC) which started the process of bringing NARFE into the 21st century.

NARFE is currently working with our Federations and Chapters to issue more documents and information electronically which has resulted in a savings of thousands of dollars.

As your National President, I have worked with the National Executive Board (NEB), Federations and Chapters

to strengthen our Association in the Legislative Program and in our Recruitment and Retention (R&R) efforts. Under my leadership, we launched a million dollar marketing effort entitled “Protect America’s Heartbeat “(PAH) designed to educate Congress and the public on the enormous value of our government employees and retirees. This program was essentially financed by your generous contributions. Because of PAH, the only negative action that was made unilaterally by President Obama was a pay freeze for 2 years. Through our efforts, NARFE members did not lose any of their earned benefits in 2011.

NARFE is presently engaged in a fight for our survival through our R&R program. NARFE hired a company (MGI) to assist us in reversing the downward decline in our membership. We are beginning to experience the results of this effort. The decline in our member-

ship is slowing down; however, my goal is to increase membership through a more aggressive R&R effort.

One of our ideas to increase membership was to launch a new “electronic chapter” in 2011. Membership in this highly successful chapter has exceeded 2,000 in the past 10 months.

Under my leadership, we are working more closely with other organizations to enhance our “clout” on Capitol Hill and to increase our membership. On behalf of current and retired federal employees, I have testified numerous times on Capitol Hill.

There is still a lot more work to be done. I have the experience, leadership skills, expertise and enthusiasm to continue to be your innovative National President. I would appreciate your vote in Sparks/Reno. “Working Together, We Can Make A Difference.” ■

PAUL H. CAREW Candidate for National Vice President

W

hen I first announced for National Vice President in 2010, I did so because I believed that NARFE was at a crossroads and, if we wanted our Association to grow and prosper, change was imperative. I made a commitment to you to use my skills and experience to bring new ideas, programs and services to increase membership, improve and

40

streamline the organization and, most especially, to improve communications between the headquarters, federations and chapters.

I am proud of what has been accomplished to date. To dramatically improve inter-Association communications and membership information accessibility, the NARFE Information Technology Advisory Committee

(NIAC) was created and charged with the responsibility of articulating a comprehensive 21st century IT Strategic Vision for the Association.

Implementation of the NIAC recommendations has literally revolutionized the membership reporting structure and data feed to the field. Membership data is provided now online in a live, APRIL 2012 | NARFE

real-time basis. This is an absolutely invaluable tool for membership recruitment and retention. As a follow-on to the groundbreaking NIAC effort, the Configuration Advisory Board (CAB) was established. The CAB consists of ten IT savvy members, one from each Region, with the overall objective of making recommendations to increase the operational efficiency and usefulness of the NARFE IT infrastructure and management. The CAB is functioning well beyond my initial expectations.

To grow our membership realistically, NARFE must focus on and target active federal employees and recent retirees by using the communications tools and scenarios that are an integral part of their daily lives. The digital world and the anonymity of the screen is their meeting space. A duly chartered electronic (eNARFE) chapter was designed and implemented to test this assumption and it has been extremely successful. All information, including an interactive blog, is provided on the eNARFE website. It is the fastest

growing chapter in NARFE with only a nominal number of members transferring from traditional chapters.

I hope that you are as pleased as I am with the progress to date. I fully realize that the digital world is not everyone’s cup of tea and dealing with it is a struggle for many, but 21st century technology is here and it is the future of NARFE. I ask that you return me to office of National Vice President for another term so I may continue to develop my articulated goals. ■

ELAINE HUGHES Candidate for National Secretary

I

am the kind of person who hates to leave a job unfinished! And with this statement, I am once again asking for your support as I seek reelection to the Office of the National Secretary.

In my first year as National Secretary, we initiated a number of projects which I believe will enable us to turn our membership numbers around and begin to trend upward instead of downward. At the beginning of 2011, at my request, President Beaudoin appointed two five member membership committees, consisting of several members who have exhibited an interest and aptitude for recruiting and retaining members. As a result of the tremendous work exhibited by these two committees, we included several of their initiatives in the development of the 2012 membership growth plan.

To assist in the implementation of

the 2012 plan, we secured the services of Marketing General Incorporated (MGI), an Alexandria-based firm specializing in membership growth for non-profit associations, like ours. One immediate benefit of working with MGI has been an aggressive telemarketing campaign which targeted recently dropped members. The result has been the re-instatement of over 1,500 former members to welcome back to our NARFE family.

There are many more equally important and innovative projects in our 2012 Membership Growth Plan which strategically blends the desires of our traditional chapter structure with the desires of my generation, the baby boomers and beyond. I look forward to sharing our progress as I reconnect personally with many of you at the upcoming Federation Conventions and the National Convention in Sparks/

Reno in August.

By allowing me the opportunity to continue working with our NARFE staff and NARFE leadership, I strongly believe we can experience the membership growth that is so critical to safeguarding our rightfully earned benefits.

We are already seeing signs of slowing the downward trend, and I very much want to continue to be a part of the growth campaign.

NARFE has played an important role in my life since I retired from the Department of Energy after thirty years of service. Since then, I have served as president of my home chapter, the Charles R. Patton Chapter 156 in Asheville, NC, and as President of the NC Federation of Chapters.

Again, thank you for your past support, and I ask for your vote for another term as your National Secretary. ■

RICHARD G. THISSEN Candidate for National Treasurer

I

am announcing my candidacy for the position of National Treasurer.

I have been in this position for 10

NARFE | APRIL 2012

months and have made a significant difference to NARFE. My unique qualifications include

time as Treasurer, over 8 years as Regional VP and 3 years

41

as NEB Audit Committee Member/ Chair.

As with all organizations, NARFE faced a tenuous financial situation due to the severe downturn in the economy.

NARFE’s cash flow situation was affected and our Dunn & Bradstreet rating suffered. Significant budgetary issues also had to be addressed due to the recognized need to expand our legislative and membership programs and to phase in necessary upgrades to our obsolete office infrastructure.

Action has been taken to fund the expanded legislative and membership programs. A much needed membership records online activity module (OAM) was funded and is up and running, and the first phase of the upgrades to our headquarters work stations has begun.

Despite these improvements and the fact that the full impact of the dues increase was not felt during 2011 (dues

42

increase was not effective until March, 2011 and many members renewed for multiple years at the old rate), I am pleased to report that our Dunn & Bradstreet rating has rebounded dramatically (bills are paid on time) and you will see in the 2011 financial statements that my work helped reduce our operating cash flow deficit by a significant percentage. I will be pleased to provide you with specific financial data once our annual audit is completed.

Through research, I developed reports to provide the Regions and Federations feedback on their membership activities, significantly increasing visibility and effectiveness.

We have also established a sound base for the future by the principles that were applied to the 2012 budget process: NARFE has instituted a hiring freeze (hiring/replacement requests are subject to a strict review) and a pay

freeze for staff; we have reviewed our current contracts and have renewed them at either present value or significant reductions; fundraising costs will be reduced by more that $250,000; magazine costs have been reduced by approximately $200,000 per year. We have also revised our process on how we calculate projected expenses and revenues, thus eliminating any “surprises.”

In closing I want to thank all of you for your help in these accomplishments. Your generous contributions to our fundraising campaigns helped make this happen. Together we can keep NARFE viable and strong. ■

Candidate Statement Deadlines: April 1 for June issue May 1 for July issue

APRIL 2012 | NARFE

Report From the Regions Leap Year’s Resolution

By Jerome S. Smith Region VI Regional Vice President retiredjer@aol.com

I

don’t know about you, but I’m glad that 2011 is over. NARFE lost too many members for nonpayment of dues and gained precious few new members. We also were under attack by Congress as it looked for ways to reduce the federal deficit. I think that we can all agree that it was not a very good year.

I’m convinced that 2012 has to be an improvement over last year. In fact, it already is. According to the Gregorian calendar (year 1592-2400), this is a leap year. I

have never understood where we are supposed to leap to or leap from; but for at least 420 years, we have “leaped” every four years. Therefore, we should just accept it and profit from the extra day we get this year.

It’s a little late to make a New Year’s resolution, so why don’t we make a Leap Year’s resolution instead? Let’s all resolve to take advantage of the extra day and recruit a new NARFE member.

Just think what that would mean for NARFE. First, we would double our membership; then, we double our clout with Congress and improve the chances that our earned benefits will not be reduced. And all this for recruiting one member!

Everyone can recruit, and everyone knows someone who would benefit from becoming a NARFE member. I am

sure that all of you get quite a bit of mail delivered to your homes. So who do you think delivers all of that mail to you?

The next time you see your letter carrier, grab your copy of NARFE magazine and hand it over. Our award-winning magazine by itself should convince most folks to join NARFE. Of course, if you are really brave, you also could tell your letter carrier about some of the ways NARFE has improved federal retirement benefits since 1921 – important things such as ensuring that spouses get survivors’ annuities, or that retirees can participate in Open Season for health insurance and also have the opportunity to opt for long-term care insurance. These are just a few.

That wasn’t so hard now, was it? And you may have just recruited a new NARFE member. ■

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

Life Membership Fee Schedule

Membership Information

Contact Information

Ages

(Active NARFE members)

Member Number:_______________________

Full Name: Mr./Mrs./Miss/Ms.

Street Address

Single or Quarterly Payment Installments

Apt./Unit

City/State/ZIP

E-mail Address

30-39 $1,796 40-40 1,408 (New members) Membership is open to civilians in 1,127 any agency of the federal or D.C. (before Oct. 1, 1987) 51-55 56-60 960 governments eligible for a federal annuity.

61-65 801 Check one: 66-70 653 Retiree Active federal employee 71-75 514 Spouse Former federal employee 76-80 392 Former spouse Survivor 81-90 251 91-100+ 127

Payment Information Single payment

or

$450.25 353.25 283.00 241.25 201.50 164.50 129.75 99.25 64.00 33.00

Quarterly Installments (4 payments)

Life Membership fee amount: $____________

Date of Birth

Recruiter’s ID # (if applicable)

Credit card

Check or money order (payable to NARFE)

Credit Card Info: MasterCard

Discover

Visa

AMEX

Card Number:______________________________ Exp. Date:_____/_____ Chapter Number (call 800-456-8410 for chapter information)

Name on Card: (print) ___________________________________________________ Signature: __________________________________________ Date:______________

Thank you for becoming a National Member for Life. You will receive a membership card, certificate and special lapel pin. Please allow six weeks for processing. Dues payments & gift contributions to NARFE are not deductible as charitable contributions for income tax purposes.

Mail application and payment to: NARFE, Attn: Member Records, 606 N. Washington St., Alexandria, VA 22314 NARFE | APRIL 2012

43

NARFE News NARFE Offers Online Activities Module and Reports for Federation and Chapter Officers

N

ARFE Headquarters is constantly working to improve the timeliness and quality of the information it delivers to federation and chapter officers. For several years, it has offered monthly online membership and financial reports through the NARFE website. These reports, formerly printed and mailed to each chapter and federation, contain the information necessary to manage federation and chapter membership and financials. Now, in addition to online reports, NARFE HQ has implemented a new Online Activities Module (OAM), which provides membership information on demand.

“The OAM gives chapters and federations the tools they need to help them better recruit and retain members,” says Fred Hamidzada, director of Information Technology. “This sophisticated online service is designed to perform intricate tasks with a

simple click of a button.”

For example, OAM has a built-in email system, which allows federation and chapter officers to communicate with new members, potential members, lapsed members and existing NARFE members. With a simple click, it allows officers to contact members before their memberships expire. They also can welcome new NARFE members, inviting them to chapter meetings and other activities.

These online services have been developed not only to increase membership but also to make it easy for federation and chapter officers to communicate and engage with NARFE members, Hamidzada notes. Access to these services is limited to certain federation and chapter officers.

To find out more about the OAM, go to www.narfe.org/OAM. The NARFE Information Services Department is

working with the NARFE Configuration Advisory Board (CAB) to further advance NARFE in technology, as more and more members and officers use technology as a major part of their daily routines. CAB is made up of 10 members, one from each NARFE region, who represent chapters and federations. NARFE members and officers are urged to contact their regional CAB representative to voice their opinions or offer suggestions for improving online data services. Go to the web address listed above for names and contact information. ■

2012 SCHOLARSHIP APPLICATION ➮ Deadline for applying is April 27!

NARFE-FEEA PROGRAM FUND CONTRIBUTION FORM

YES! I would like to help with my contribution.

Please check appropriate box(es). To make credit-card contributions,call 800-338-0755.

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

❏ ❏

NARFE-FEEA Disaster Fund NARFE-FEEA Scholarship Fund

Amount $ Amount $

Name

44

Make check payable to: NARFE-FEEA Disaster Fund or NARFE-FEEA Scholarship Fund.

Please mail coupon and check to:

FEEA

Address City

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

State

ZIP

3333 S. Wadsworth Blvd., Suite 300 Lakewood, CO 80227

APRIL 2012 | NARFE

National Active and Retired Federal Employees Association

✄ Cut Along Dotted Line ✄

2012 Scholarship Application Applicants: • Must be high school seniors planning to attend an accredited college full-time in the fall/winter of 2012.

• Must have a grade point average of at least 3.0 on an unweighted 4.0 scale.

• Must be sponsored by a parent, grandparent or greatgrandparent who is a current NARFE member. (Step parents, step grandparents, etc., can also sponsor.)

Sponsor must be living at the time application is submitted.

• Must provide your email address on the application. Your application receipt will be sent to this email address; please add “confirmation@feea.org” to your address book.

• Must provide the following materials in your application packet: ❏ Official 2012 NARFE scholarship application.

Photocopies are acceptable. ❏ Full transcript, including fall/winter 2011 grades. Report cards and photocopies are acceptable. If mailed separately by the school, must arrive by program deadline. ❏ Copies of ACT, SAT or other entrance examination scores.

(Home-schooled students must provide equivalent of transcript and test scores as applicable.) ❏ List and brief description of any awards or volunteer/ community service activities (not to exceed two pages). ❏ Written recommendation from a teacher or counselor, on school or other official letterhead. ❏ One stamped, self-addressed #10 envelope ❏ Essay

Essay Information The essay must be typed, double-spaced, not more than two pages on the following topic: Recent crises have shown us that we live in a world more interconnected than ever before. What is the most positive attribute of American government that other nations can learn from us? What might we learn from other countries’ systems of government?

All of the above materials (except transcript, if necessary) must be mailed in the same 9”x12” (or larger) envelope, postmarked no later than April 27, 2012, to: NARFE Scholarship Award, 3333 S. Wadsworth Blvd., Suite 300, Lakewood, CO 80227. DO NOT FOLD MATERIALS. DO NOT USE STAPLES OR PAPER CLIPS. Please note: All materials submitted with the application will become the property of FEEA and will not be returned under any circumstances. If needed, make a copy of the information for yourself before mailing.

A total of 60 scholarships of $1,000 each will be awarded.

Applicants will be notified of the judges’ decision by the end of August. A list of winners and their NARFE sponsors will appear on the NARFE member website at www.narfe.org and will be published in the December issue of NARFE magazine.

The NARFE Scholarship Program is administered by the Federal Employee Education & Assistance Fund (FEEA) and is made possible by your tax-deductible contributions to the NARFE-FEEA Scholarship Fund, 3333 S. Wadsworth Blvd., Suite 300, Lakewood, CO 80227.

For more information, obtain a copy of NARFE publication F-105, A Guide to NARFE’S Annual Scholarship Awards Program. To get your copy, send an email to natvp@narfe.org; download it from the NARFE website, www.narfe.org; or call Headquarters and ask for the Office of the National Vice President. The F-105 may also be ordered using the F-18.

Please complete the following. Incomplete applications and applications sent to NARFE Headquarters will not be considered.

Student’s Name:______________________________________

I am taking college courses in high school: ❏ Yes

Complete Home Address:

NARFE Member’s Name: ______________________________

____________________________________________________

Relationship to Applicant:

____________________________________________________

❏ Mother ❏ Father ❏ Grandfather ❏ Grandmother

Home Telephone _____________________________________

❏No

NARFE Member No.: __________________________________ Email Address: _______________________________________ Applicant’s Grade Point Average (GPA): __________________ (Applicants must have a cumulative GPA of 3.0 on an unweighted 4.0 scale) College or University (planning to attend): ________________ ____________________________________________________ (Must be a college freshman by fall/winter 2012)

Chapter No.: ________________________________________ Member’s Complete Home Address: ____________________________________________________ ____________________________________________________ Member’s Telephone: _________________________________ Member’s Email address: ______________________________

All of the above materials (except transcript – if necessary) must be mailed, unfolded, in the same 9” x 12” (or larger) envelope postmarked no later than April 27, 2012, to: NARFE Scholarship Award, 3333 S. Wadsworth Blvd., Suite 300, Lakewood, CO 80227 NO STAPLES OR PAPER CLIPS, AND DO NOT FOLD NARFE | APRIL 2012

45

Out & AW bout ith the Chapters Visit our online photo gallery at www.narfe.org.

Click on NARFE magazine.

Meet the Candidates. Chapter 443 in Huntsville, AL, held a forum for two candidates for Alabama’s 5th Congressional District. Candidates Parker Griffith, left, and U.S. Rep. Mo Brooks, far right, are pictured with NARFE officers. From left to right: Griffith; John Schmitz, Chapter 443 president; Willa Dean Morgan, Alabama Federation president; Stanley Fields, Alabama Federation District 5 vp; Cheryl Patterson, Chapter 443 first vp; and Brooks.

Pretzer Resigns as Alzheimer’s Chair

B

Big 60! NARFE National President Joseph A. Beaudoin, left, presents a plaque to Herb Heck, president of Chapter 91 in Corpus Christi, TX, on the chapter’s 60th anniversary. Also pictured are Mary Herrera, chapter vp; and Jerome S. Smith, Region VI vice president.

arb L. Pretzer of Manhattan, KS, has resigned for health reasons as chair of the NARFEAlzheimer’s National Committee. Pretzer, Region V representative on the committee since 2004, had served as committee chair since 2006.

Jane Rodgers of Wadesville, IN, vice chair of the committee and Region IV representative, has been named to succeed Pretzer as chair. A new Region V representative will be assigned.

To submit a photo: E-mail it to rl@narfe.org or send it by postal mail to NARFE Headquarters, ATTN: Out & About.

NARFE members contributed for Alzheimer’s research:

SUPPORT ALZHEIMER’S RESEARCH

$10 Million Fund

$9,567,677* *Total as of January 31, 2012 100% of all contributed funds go to Alzheimer’s research.

If you have any questions, write to: National Committee Chairman Jane Rodgers, P.O. Box 234 Wadesville, IN 47638-0234 Email: ajrodgers@tds.net

Enclosed is my NARFE-Alzheimer’s contribution: $ ___________.

Every cent that is contributed is used for research.

Please circle:

Mr.

Mrs.

NARFE-Alzheimer’s Research and mail to: Alzheimer’s Association 225 N. Michigan Ave., 17th Floor Chicago, IL 60601-7633

46

Ms.

Address _____________________________________________________________ City _______________________________ State _________ ZIP ______________ Chapter number _______________________ Credit Card Information: ❑ Visa

Your charitable contribution is tax-deductible to the fullest extent allowed by law. Write your chapter number on check; make it payable to:

Miss

Name _______________________________________________________________

❑ MasterCard

❑ Discover

❑ AMEX

Card Number: __________________________________________________________ Expiration Date:________(mm)/_________(yy) 3-Digit Security Code: _________ Name on Card: (print) ___________________________________________________ Signature:_________________________________________ Date: _______________ APRIL 2012 | NARFE

Join

NARFE

Who can join?

Today!

To apply:

Membership is open to civilians in any agency of the federal government including: • Retirees • Active federal employees • Spouses and former spouses of active and retired federal employees • Former employees eligible for deferred annuity • Survivors of those eligible to join NARFE

Check out eNAR FE, ou r new electronic m embership option, at www.NAR FE .org

• Complete the application below.

• Enclose payment information, bill pay, check or money order payable to NARFE, or request to be billed.

• Or go to our website at www.narfe.org.

• Or call us at 800-627-3394 and join today!

Enrollment includes membership in a local chapter and the national association, plus a subscription to NARFE’s monthly publication, NARFE magazine.

NARFE MEMBERSHIP APPLICATION For Active and Retired Federal Employees 1. Choose all that apply: Retiree Spouse Survivor

Active employee Former spouse Former employee

2. Also enroll my spouse __________________________

www.narfe.org

Contact Information:

Full Name: Mr./Mrs./Miss/Ms.

full name

3. Please enroll me in NARFE chapter ______________

Street Address

4. __________ $45 x __________ Membership Fee # of People Per Person Enrolling

City/State/ZIP

= __________ Total Payment

Total payment (check, bill pay or money order payable to NARFE) Bill me (Membership starts when payment is received) Charge to my credit card The first year membership fee includes national and chapter dues.

Credit Card Information: MasterCard Card type: Discover

VISA AMEX

Card No. ___________________________________________

Apt./Unit

Phone Number Email Address Date of Birth Spouse’s Date of Birth (if applicable) Recruiter’s Membership and Chapter Number

Expiration Date ________________ (MM)

(YY)

Name on Card (Print) ________________________________ Signature ____________________________ Date __________

NARFE | APRIL 2012

MAIL TO:

NARFE Member Records 606 N. Washington St. Alexandria, VA 22314-1914 Fax: 703-838-7783

1Q 47

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

MOVING SERVICES

INSURANCE NARFE INSURANCE SERVICES

NARFE MEMBER HOMEBENEFITS 1-800-666-9203 http://narfe.myhomebenefits.com • Earn thousands in cash-back rewards when you buy or sell a home* • Shop competitive mortgage rates, receive discounts on closing costs, plus take advantage of your VA Loan Benefits • Receive preferred pricing on interstate moving services with the nation’s most trusted moving company – Allied Van Lines! *State restrictions apply. Call or visit website for details.

BEKINS VAN LINES 1-800-456-6832 (M-F, 8 a.m.-5 p.m. CT) narfe@bekins.com All NARFE members will receive discounted pricing for all interstate shipments. Discount will apply to packing and moving services and valuation protection. All intrastate shipments, locals and international moves will be competitive in cost based on your geographical location. Mention you are a NARFE member and transportation agreement #00930.

VACATION RENTALS

Endless Vacation Rentals® As a member of NARFE, you will receive 10% off the “Best Available Rate” at vacation rental properties booked at www.evrentals.com/narfe or by calling 1877-670-7088, prompt 3, and providing promotion code 20672 at time of booking.

48

1-800-233-5764 Designed and administered by Marsh U.S. Consumer, a service of Seabury & Smith, Inc., exclusively for NARFE members: Senior Whole Life, Term Life, Medicare Supplements, Hospital Income Plan, Short Term Recovery Insurance, Pet Insurance, Accidental Death & Dismemberment, Cancer Care, Enhanced Dental Insurance and Long Term Care.

Go to www.narfeinsurance.com for more information on these programs.

GEICO: 1-800-368-2734 NARFE members with good driving records may be eligible for quality automobile insurance from GEICO. Ask about the NARFE discount available to members in many states. Call today for your free, no-obligation rate quote. Be sure to mention that you’re a NARFE member!

• Discount amount varies in some states • Discount not available in all states or in all GEICO companies • One group discount applicable per policy.

EMERGENCY SERVICES SINCE 1974 1-800-423-3226 Medical Air Services Association has been the industry leader in prepaid emergency assistance services for more than 30 years. NARFE members have experienced MASA’s “peace of mind” services since 2001. Now NARFE members are entitled to even more: air ambulance transportation, helicopter transportation, ground ambulance, vehicle return, mortal remains transport, and much more!

Call MASA Today. It Could Save Your Life!

TRAVEL CRUISE SALE! Unbeatable Deals on Your Favorite Cruise • Save 50%, 60%, up to 70% • Free Stateroom Upgrades • up to $200 Shipboard Credit • up to $425 in Onboard Savings Win a Free 7-night Cruise Call us Toll-Free or Sign-Up Online!

1-800-607-4538 www.NARFEtravel.com

HEARING BENEFITS

Two discount programs to choose from: ValueAdd® or MemberPlus®. Similar to a warehouse membership, MemberPlus saves hundreds more for a $108 yearly membership.

MemberPlus also includes: • 45-day, money-back guarantee on membership fee and all purchases • 48 batteries, 3-year warranty, and onetime loss and damage for 3 years (small manufacturer deductible applies) on each purchased hearing aid • Guest membership for up to four extended family members (siblings, parents, etc.) for only $79 each • Combine with an existing health plan hearing benefit to maximize savings Visit TruHearingMemberPlus.com for more information, or call 877-360-2442 Mon-Fri, 9 a.m.-9 p.m. East Coast Time

APRIL 2012 | NARFE

HOTELS

CAR RENTALS

CREDIT UNION

CHOICE HOTELS INTERNATIONAL With 6,000 hotels in the United States and throughout the world, Choice Hotels® offers something for everyone. Join the Choice Privileges® rewards program and earn points with every qualifying stay toward free nights, Airline Rewards, gift cards and more. As a NARFE member, receive 20% off your next stay at participating hotels when you use Special Rate ID 00801967. This offer is subject to availability and cannot be combined with any other offer. Advance reservations required. To book, visit choicehotels.com or call 800-258-2847.

ALAMO Drive Happy® with Alamo® where NARFE members receive year-round discounts. Call 1-800-462-5266 and reference Contract ID 262544.

NATIONAL You Drive A Hard Bargain. Receive up to 20% off rentals at National Car Rental. To make a reservation call National Car Rental at 1-800-CAR-RENT® and reference Contract ID 5282909.

NARFE’S OF FICIAL CREDIT UNION As a member of NARFE, you have the privilege of joining NARFE Premier Federal Credit Union, which has been serving members since 1935. We offer extensive services at competitive rates to members nationwide. Your savings are federally insured to at least $250,000 and backed by the full faith and credit of the United States Government.

For more information, call 800-3281500, e-mail jparish@narfepremierfcu. org or visit us at NARFEpremierfcu.org.

CREDIT CARD AVIS: 1-800-331-1441

WYNDHAM HOTEL GROUP As a member of NARFE, you will receive up to 20% off the “Best Available Rate” at participating locations when you travel. Call and give agent your special discount ID number, 8000002694, at time of booking to receive discount. Whether you are looking for an upscale hotel, an all-inclusive resort or something more cost-effective, we have the right hotel for you... and at the right price. So start saving now. Call our special memberbenefits hotline 1-877-670-7088 and reserve your room today at one of these fine hotels: Wyndham Hotels and Resorts®, Days Inn®, Ramada Worldwide®, Super 8®, Wingate By Wyndham®, Baymont Inns and Suites®, Hawthorn Suites® By Wyndham, Microtel Inns and Suites®, Howard Johnson®, Travelodge® and Knights Inn®.

NARFE | APRIL 2012

The employees/owners of Avis offer guaranteed low rates and quality services to members of NARFE. Mention ID# A991900.

HEALTH SCREENING

LIFE LINE SCREENING Life Line Screening, America’s leading provider of community-based preventive health screenings, will conduct the following screenings using state-of-the-art ultrasound technology in your neighborhood: 1. Stroke/Carotid Artery 2. Abdominal Aortic Aneurysm 3. Atrial Fibrillation 4. Peripheral Arterial Disease.

You will receive a confidential written report within 21 days. Life Line Screening and NARFE encourage you to share these test results with your doctor. All four screenings cost just $135. To schedule an appointment, please call 1-800-324-9906 and give the operator code number: BKHN075 or visit www.lifelinescreening. com/NARFE. Coverage may vary and may not be available in all states.

Bank of America now offers the officially approved credit card program for NARFE, featuring the Platinum Plus® MasterCard® with WorldPoints. This is the only credit card that helps support NARFE every time you use it to make a purchase–at no additional cost to you.

Call toll-free 1-866-438-6262 Use NARFE’s full name, not NARFE. Use priority code: UABEWD.

NARFE MERCHANDISE NARFE GENERAL STORE

Order Official NARFE name badges, customizable NARFE logo products and plaques. www.narfegeneralstore.com Phone: 252-353-4005

49

For the Record The chart below tracks the CPI-W, the monthly inflation change, and the cumulative percentage gain for the next CSRS and Social Security COLA. CPI-W October 2011 November December January 2012 February March April May June July August September

223.043 222.813 222.166 223.216

MONTHLY % CHANGE % CHANGE FROM 223.2 -0.29 -0.10 -0.29 +0.5

Stocks Up for Second Month

By Tracey Ray

F

ebruary was a repeat of January’s great performance for the stock funds, as they were all up for two months in a row for the first time since 2010.

The I Fund was the best-performing fund for the first time since April 2011 because investors focused on efforts to resolve the Greek debt crisis. The C Fund rose to its highest level since June 2008, as American economic news was better than expected, particularly on the unemployment front. Even steadily rising gas prices didn’t dampen enthusiasm for stocks.

Despite the run-up in stocks, the F Fund, composed of government, corporate and mortgage-backed bonds, is the best performer for the last 12 months at 8.5 percent, surpassing the next-best fund (C Fund) by more than 3 percent.

Tracey Ray is chief investment officer of the Thrift Savings Plan.

50

-0.09 -0.19 -0.48 -0.01

Inflation Rose in January

T

he Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) increased 0.5 percent in January. To calculate the 2013 cost-of-living adjustment (COLA), the indices of July, August and September 2012 will be averaged for a thirdquarter determinant, which will be compared with the 2011 thirdquarter base of 223.233. The January index of 223.216 is down 0.01 percent from the base – essentially even.

Benefits awarded under the Federal Employees’ Compensation Act (FECA) to individuals suffering work-related injuries or illnesses are adjusted according to each calendar year’s percentage change in the CPI-W. January’s index is 0.5 percent higher than the December 2011 base index of 222.166. ■

Thrift Savings Plan Investments* Month G Fund 0.26% 2011 March April 0.25% May 0.25% June 0.21% July 0.22% August 0.19% September 0.16% October 0.14% November 0.14% December 0.15% 2012 January 0.13% February 0.12% Last 12 Months 2.24%

F Fund 0.06% 1.28% 1.31% (0.30%) 1.59% 1.45% 0.73% 0.11% 0.01% 1.01% 0.88% 0.05% 8.48%

C Fund 0.04% 2.96% (1.13%) (1.67%) (2.04%) (5.44%) (7.03%) 10.93% (0.21%) 1.04% 4.50% 4.34% 5.16%

S Fund 2.06% 2.94% (1.27%) (2.35%) (3.14%) (8.12%) (10.73%) 14.09% (0.51%) (0.04%) 7.59% 3.99% 2.16%

Month March 2011 April May June July August September October November December 2012 January February Last 12 Months

L 2020 (0.03%) 2.37% (0.74%) (0.84%) (0.94%) (3.69%) (4.73%) 6.18% (0.34%) 0.11% 3.03% 2.53% 2.46%

L 2030 (0.05%) 2.83% (0.97%) (1.10%) (1.25%) (4.63%) (5.92%) 7.68% (0.49%) 0.09% 3.77% 3.10% 2.35%

L 2040 (0.08%) 3.20% (1.15%) (1.30%) (1.49%) (5.37%) (6.85%) 8.83% (0.62%) 0.07% 4.34% 3.54% 2.15%

L Income 0.17% 1.01% (0.05%) (0.18%) (0.14%) (1.10%) (1.51%) 2.31% 0.02% 0.20% 1.18% 0.98% 2.86%

I Fund (2.23%) 6.03% (2.90%) (1.16%) (1.60%) (9.03%) (10.55%) 9.48% (2.46%) (2.03%) 5.36% 5.14% (7.68%) L 2050 (0.15%) 3.57 (1.39%) (1.48%) (1.75%) (6.16%) (7.80%) 9.92% (0.78%) (0.01%) 4.87% 3.99% 1.57%

*This chart is provided as a service to NARFE members who enrolled in the Thrift Savings Plan while employed by the federal government. Retirees are not eligible for enrollment. These returns are net of the effect of accrued administrative expenses and investment expenses/costs. Percentages in ( ) are negative. Source: tsp.gov.

APRIL 2012 | NARFE

BEST-SELLING PRODUCTS

f o r

S e n i o r s

“Ten-ten AM, Thursday, March 15th, 2012”

i n

2 0 1 2

The wristwatch you never have to set… or even see.

Thanks to its revolutionary design, the Talking Atomic Watch gives you accuracy to within a billionth of a second. It gets its signal from the US Atomic Clock, the standard for time keeping worldwide. Plus, all you have to do is push a button, and the watch will “tell” you the time in a clear, easy-to-understand voice. It will even tell you the day and date.

Travelling? Touch a button to switch it to any time zone. It’s lightweight and attractive… and it’s always accurate. The Talking Atomic Watch was . . . $89.95. Now $49.95 + S&H. Call today. 1-866-254-4708. Please mention Promotional Code 44353.

Our Lighted Full-Page Magnifier is hands-free and huge!

Our one-of-a-kind magnifying floor lamp combines powerful FULL-PAGE magnification with flexible adjustability and clear, even Balanced Spectrum light. Twelve high-powered LEDs provide ample light for close work and reading. The super-large lens provides 2.5X-plus variable magnification, to easily cover an entire page without glare or hot spots. The ultra-flexible gooseneck positions the lens exactly where you need it. And unlike that magnifier in the drawer, you’ll always know where this one is.

Magnifying lens dimensions are a whopping 7.375” x 10”. AC operated. Lighted Full Page Magnifier was . . . $99.95. Now $79.95 + S&H Call today. 1-877-670-0739. Please mention Promotional Code 44354.

A floor lamp that spreads sunshine all over a room.

The Balanced Spectrum’s 27-watt compact bulb is brighter than a 100-watt ordinary light bulb. With the lamp’s sharp visibility, you will see with more clarity and enjoyment in close tasks such as reading, writing, sewing, and needlepoint. It is especially helpful for aging eyes.

Experience sunshine indoors at the touch of a switch. This amazing lamp is not only easy on the eyes, it is easy on the hands as well, featuring a special “soft-touch, flicker-free” rocker switch that is easier to use than traditional toggle or twist switches. And its flexible gooseneck design enables you to get light exactly where you need it. The high-tech electronics, the user-friendly design, and a bulb that lasts 10 times longer than an ordinary bulb–all these features make the Balanced Spectrum® floor lamp a must-have. Balanced Spectrum® floor lamp Only $59.95 each + S&H or buy two lamps for $99 + S&H. Call today. 1-877-720-9914. Please mention Promotional Code 44355.

Are you in love with your home, but afraid of your staircase?

If you or someone you love lives in a home with more than one floor, the staircase can be more than an inconvenience, it can be a health threat. Whether it's due to mobility issues or cardiac concerns, why risk your life climbing stairs when an easy solution is only a phone call away? You’ll be surprised how easy, simple, and affordable the Easy Climber is. It features a reliable, aircraft-grade cable drive that’s been tested over 30,000 cycles. It’s also designed for basements and outdoors. It’s simple enough for most people to install on either side of the stairs, a snap to use, and comes with an exclusive lifetime warranty on the drive train. Call our toll-free number now, and a friendly, knowledgeable product expert can answer all of your questions and help you get on the road to independence and safety in the home. Call today. 1-888-691-8325. Please mention Promotional Code 44356.

TM

Hand-Stitched

LEATHER Loafers

24FREE! 99 per pair

Shipped

5 Colors to Choose! Cushioned for Comfort!

Medium & WIDE Widths!

Light Taupe

Red

Twin elastic gores make ’em easy to slip on!

White

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Dr. Scholl’s is a registered trademark of MSD Consumer Care, Inc. © 2012 MSD Consumer Care, Inc. All rights reserved.

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

Hand-stitched “Star” Leather Loafers Loaded with Stellar Comfort!

Genuine Leather uppers are meticulously hand-stitched with a star design. Perfs and side vents add style & cooling ventilation too.

Complete with easy-on twin elastic gores at instep, padded ankle collar, and soft foam backed tricot lining. Flexible treaded outsole, perfect 1" heel.

Available only from Haband! www. .com/bestdeals Order now!

Duke Habernickel #1 Bargain Place, Jessup, PA 18434-1834

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LEATHER Loafers

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Haband #1 Bargain Place, Jessup, PA 18434-1834 Send ____ pairs. I enclose $________ purchase price plus $5.99 toward postage. In GA add sales tax. On-Line Quick Order

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MEDIUM: 5 51⁄ 2 6 61⁄ 2 7 71⁄ 2 8 81⁄ 2 9 10 11 *WIDE $4 more per pair: 6 61⁄ 2 7 71⁄ 2 8 81⁄ 2 9 10 11

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INDIGO 15 WHITE RH RED 25 DA LIGHT TAUPE Ø1 BLACK (Not Shown)

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Imported WHAT WHAT HOW SIZE? WIDTH? MANY?

Card # ________________________________________Exp.: ______/_____ Mr. Mrs. Ms. ___________________________________________________ Address ___________________________________________ Apt. # ______ City & State _____________________________________ Zip ___________ Phone/Email ___________________________________________________ 100% Satisfaction Guaranteed or Full Refund of merchandise purchase price.