Federal organizations and their friends on Capitol Hill are attempting to educate or embarrass Congress out of the idea of exempting itself from a pension tax change in the works for most other public servants.
Today at 9 a.m., more than a dozen organizations plan to hold a news conference at the Cannon House Office Building to show their opposition to legislation that would allow members of Congress to escape paying taxes on their pensions as soon as they retire.
The groups hope to focus national attention on the issue and embarrass those who are seeking special tax treatment for themselves.
This is a calculated risk for the groups, whose members include federal executives, government veterinarians and teachers who depend heavily on congressional good will.
The tax reform bill tentatively approved by the House Ways and Means Committee would revamp tax rules for state, local and federal government workers and others who contribute to their retirement programs.
It would require all those employes, except members of Congress and political appointees, to pay federal taxes on their pensions as soon as they retire.
Under current law, workers who help finance their retirement benefits don't pay taxes after they retire until they get back all the money they contributed (and already paid taxes on).
This creates a tax-free period of about 18 months for the typical retiree, and up to three years for big contributors to the pension system -- such as longtime members of Congress.
The proposed tax change, which would raise about $8 billion over three to five years, would require those retiring after next July 1 to pay taxes on a prorated portion of their pensions.
The Federal Government Service Task Force, a congressional civil service caucus, estimates that the change would mean an unexpected tax bite of $10,000 in the first three years for the typical retiree.
Higher-paid government workers would be hit even harder, which is why the tax plan contains an escape hatch for some of the most senior and powerful members of Congress planning to retire.
Yesterday some members of Congress told the House Rules Committee that they want the committee, which acts as the traffic cop for legislation heading for the House floor, to allow an amendment to the tax reform bill, striking the post-retirement tax plan.
Those opposing the plan included Reps. Steny Hoyer (D-Md.), Frank Wolf (R-Va.) and Stan Parris (R-Va.) from this area, as well as Reps. Vic Fazio (D-Calif.) and Mary Rose Oakar (D-Ohio).
As of late yesterday, Hoyer had picked up 72 House signatures on a letter addressed to the Rules Committee chairman, Rep. Claude Pepper (D-Fla.), attacking the "unfairness" of the plan to change pension rules and to exempt members of Congress from it.
". . . We did a lot of soul-searching before we decided to go with the press conference," one organizer of today's news conference said. "This could embarrass a lot of powerful members of Congress, and we hope it doesn't backfire on us.
"But we decided to take the risk, because the issue is so serious and involves every federal worker, most state and county employes, schoolteachers -- you name it. It is just too many people to let down without a fight."