House Ways & Means Committee Chair and Ranking Member Introduce WEP Bill
House Ways and Means Committee Chairman, Kevin Brady (R-TX) and Ranking Minority member Richard Neal (D-MA) have partnered to introduce legislation designed to lessen the effects of the Windfall Elimination Provision (WEP) for current retirees and survivors, and to change the formula for calculating the WEP for those who retire and are eligible to collect a Social Security benefit starting in 2025.
The representatives introduced H.R. 6933 on Sept. 27. The bill was preceded in 2016 by H.R. 711, also sponsored by Congressmen Brady and Neal. That bill would also have replaced the current WEP formula with a new proportional formula that would have been calculated using total lifetime earnings and then adjusted for the proportion of earnings that came from a job covered by Social Security. It became mired in politics and ultimately died.
H.R. 6933 will provide for a rebate of $100 monthly beginning in 2020 for those currently eligible for Social Security and subject to the WEP. As noted, the new proportional formula will not take effect for future retirees until 2025. It is understood that this is designed to provide a transition period, in part to maintain the 30-year rule for existing public workers, who have worked to amass at least 30 years of substantial contributions under Social Security and are therefore currently exempt from the WEP.
Leigh Snell, director of federal relations for the National Council on Teacher Retirement offered the following information regarding the bill: “The legislation also contains a provision requiring the Commissioner of Social Security to ‘study and test the administrative feasibility of partnering with State and local pension systems, or other governmental entities, to improve the collection and sharing of information relating to State and local noncovered pensions.”
Snell added, “Finally, the bill would amend the Social Security Act to permit the Commissioner to ‘partner’ with States to request information with respect to any designated distribution from an employer deferred compensation plan of the State (or political subdivision thereof) to a participant of such plan in any case in which any portion of such participant’s earnings for service under such plan did not constitute “employment.”
Ohio Retirement Study Council Cancels October Meeting
The meeting of the Ohio Retirement Study Council tentatively scheduled for Oct. 11 was canceled.
View a report from the National Association of State Retirement Administrators (NASRA) on reforms to public pension plans in progress around the country. We will include this report monthly as part of the Legislative News.