Groups representing 20 million government workers are hoping for a victory -- but bracing for a "soft" loss -- in the Senate fight over the tax status of employe pension contributions.
The Senate today may take up an amendment proposed by Paul Trible (R-Va.) to preserve the so-called three-year recovery rule, which would be abolished by the tax reform bill already approved by the House and under consideration in the Senate.
If Trible's amendment is approved by the Senate, or gets a substantial number of votes, it will strengthen the hand of conferees who want to protect the rule. If it loses badly, however, the House will be in a stronger position to push for immediate elimination of the benefit.
The recovery rule permits retirees to get back all previously taxed contributions to their pension programs before being subjected once again to federal taxes. That recovery rule permits the average federal retiree to draw benefits for 18 months before taxes on the government's share of contributions begin.
The House bill would end the three-year recovery rule after July 1. The Senate plan now being debated would phase the recovery period out over two years, beginning in January 1988.
Although public employe groups oppose both plans, all prefer the Senate version over the House plan.
Once the Senate approves its tax reform package it will go into conference with the House to seek a compromise.
Federal worker organizations would like to see the recovery rule retained. But if it is to be a victim of tax reform, they would like the effective date set well in the future to give employes time to rearrange their retirement plans.
If the House version became law, it would mean that workers would have only until the end of this month to retire and protect their pensions from being taxed, on a prorated formula linked to their life expectancy.
Federal agencies report a heavy surge of June retirements by employes who are bailing out to beat any possible change in the law. More on the Retirement Front
The Postal Employees Newsletter quotes Rep. Bill Ford (D-Mich.) as saying there may not be an early retirement bill this year because the proposal under consideration in the Senate also calls for a five-year federal hiring freeze.
The Senate's bill would double the number of employes who are eligible to retire. It would allow early retirement between June and December for employes with at least 25 years' service, or at age 50 with 20 years' service, at 55 after 15 years' service or at 57 after five years of service. Under current law, the earliest most employes can retire is at age 55 after 30 years of service.
Although many eligible federal workers favor the early-out, the White House and federal unions are lukewarm because it is linked to a hiring freeze.
Senate leaders are talking with the administration about a compromise. But chances for passage this year are slim unless federal agencies start making major layoffs when the fiscal year begins in October. Calling Crackdown
The Federal Times newspaper says that 75 Office of Personnel Management employes have been billed more than $15,000 for making personal long-distance calls at work. It says an OPM investigation last year showed that 38 percent of the calls were personal, and cost Uncle Sam about $58,000. OPM's audit zeroed in on frequently called numbers, and calls lasting more than two hours.