Legislation to ensure fair
retirement benefits for federal workers in Alaska, Hawaii and
U.S. Territories introduced
March 02, 2009
Today, the Non-Foreign Area Retirement Equity Assurance Act was
introduced in Congress to ensure pay and retirement equity for
federal employees in Alaska, Hawaii, and the U.S. territories.
The legislation was sponsored in the Senate by Senators Daniel
K. Akaka (D-Hawaii), Lisa Murkowski (R-Alaska), Daniel K. Inouye
(D-Hawaii), and Mark Begich (D-Alaska), and in the House by Representatives
Neil Abercrombie (D-Hawaii), Don Young (R-Alaska) and Mazie Hirono
(D-Hawaii), and Delegates Eni Faleomavaega (D-American Samoa),
Madeleine Z. Bordallo (D-Guam) and Donna M. Christensen (D-Virgin
Federal workers in Hawaii, Alaska and the U.S. territories currently
receive a non-foreign cost of living allowance (COLA) based on
the increased costs of living in those areas as compared to the
District of Columbia. But unlike locality pay received by federal
employees in the contiguous 48 states, COLA is not factored in
for retirement purposes. Furthermore, while locality rates generally
increase, non-foreign COLA rates have been gradually declining
and are scheduled to drop for all non-foreign COLA areas later
The bill would freeze non-foreign COLA rates at their current
levels and phase-in locality pay over the next three years.
Non-foreign COLA would be phased out at a slower rate than locality
pay is phased in. At the end of the three year period, if the
locality pay rate is less than the offset amount of non-foreign
COLA for a particular area, employees would continue to receive
the difference in non-foreign COLA and locality pay until the
locality rate reaches the offset COLA rate. Only at that time
would employees no longer receive non-foreign COLA.
Sen. Lisa Murkowski said, "We
came so close last year to giving Alaska's federal employees
the certainty they need to make informed retirement decisions.
The Senate passed the bill. The House of Representatives did
not. Alaska's federal employees have spoken loud and clear that
they prefer locality pay which counts toward their retirement
over their current tax free COLA which does not. I am hopeful
that Congress will act expeditiously this year to clear this
legislation for the President's desk."
"Facing the nation's highest
rates for gasoline and heating fuel, Alaska's federal employees
and their families have faced undue economic burdens from the
continuing devaluation of COLA benefits," Sen. Mark Begich
said. "This legislation will work to correct the inequity
between federal workers in Alaska, Hawaii, the U.S. Territories,
and those in the continental United States through a gradual
transition to locality pay. I look forward to working on this
legislation so that we may properly compensate our federal employees
and continue to attract and keep qualified federal workers."
"What has happened over
time is federal workers have started looking outside of Alaska
to be fairly compensated," Sen. Begich said. "This
legislation will allows us to attract and retain the highly-qualified
people we want working in our state."
Congressman Don Young said:
"With the rising costs of living in these areas, the pay
gap between federal and non-federal employees continues to grow.
Switching from COLA to locality pay over the next three years
would cut this gap and increase retirement benefits for federal
employees outside the 48 contiguous states. This bill allows
our federal employees to stretch their retirement dollars and
plan for their futures."
On the Web:
A section-by-section analysis
of the bill is available at:
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Office of Sen. Lisa Murkowski
Office of Sen. Mark Begich
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