If you live in the Washington-Baltimore area, or Pensacola, Phoenix or San Antonio, someone in your circle of friends may have spent a career with Uncle Sam.

The Washington area is chock-full of retired federal civilian and military personnel, about 300,000 of them. There are more than 3 million nationwide.

Chances are somebody in your family, church or synagogue, favorite club or neighborhood is a retired federal civil servant, or a retired member of the military, or the surviving spouse of a federal retiree.

If you know somebody who gets a civil service annuity or retired military pay, do me a big favor. There may be some danger involved.

Your assignment, should you accept it, is this:

Pick a retiree. Hand him or her this Federal Diary (after carefully removing the byline to protect me). Then run like a scalded dog. And don't look back.

The idea is to take cover as quickly and as far away as you can while the poor soul reads this equivalent of a Dear John letter to a faithful retiree.

Think of it as an educational endeavor. And also a test of the old saying about what happens to messengers who bring bad news.

The news is this:

Everybody in the federal family is getting a raise in January. But Uncle Sam will be nicer to some than others.

Active-duty federal workers and military personnel are in line for a 4.8 percent pay raise in January. Federal and military retirees aren't.

Instead, retired federal workers and military personnel (as well as people getting Social Security benefits) are looking at a January cost-of-living adjustment of about 2.1 percent. The exact amount of the COLA won't be known until sometime next month. But it won't be anywhere near 4.8 percent.

Many retirees judging by phone calls, e-mails and the like, still haven't received the bad news.

Or they refuse to believe it or demand a recount!

Or they want to know why the apparent discrimination between federal workers who are still working (who now average about $60,000 a year in the Washington area) and retirees, who generally get a lot less but spend the same thing for things like food.

Why the difference? The short answer is: It's the law.

Many retirees want more than that. So take this:

Years ago, Congress decided to base federal salaries on the going rate in the private sector. Under current law, pay raises are supposed to reflect private-sector pay changes--taking into account productivity gains, recruiting, retention and the like--though the actual link between the two is often tenuous. The amount is recommended by the president, with Congress having a say-so if it wants.

The January across-the-board pay raise is refined, at the president's pleasure, to take into account wage differentials among metropolitan areas. Federal workers in Washington make less than those in New York or San Francisco, for example, but more than civil servants doing the same jobs in Richmond.

Retirees, whose annuities are based on years of service and salary, get the same annual COLA regardless of where they live.

In the past, during times of high inflation, federal retirees got COLAs that were bigger than the percentage pay raises of federal workers. Before the law was changed in the 1980s, retirees got two COLAs a year. One year they got three. And at one point, retirees got a COLA plus 1 percent to make up for the delay in getting the adjustment to them. (Most private companies, assuming they have a pension plan, don't give their retirees cost-of-living increases, ever.)

Those days are gone. So are the days of high inflation, at least for the time being.

COLAs for federal-military retirees are based on one thing only: inflation, as measured by the consumer price index. When inflation is high, COLAs are, too. When inflation is low, COLAs are low. Like now.

Political Runaround

At 8 a.m. tomorrow, several hundred members of the House, Senate and the Washington print and electronic media take off for the annual Capital Challenge race. The three-mile run around Hains Point features five-member teams headed by folks such as Sen. Don Nickles (R-Okla.), the fastest man in Congress, Reps. Thomas M. Davis III (R-Va.) and James P. Moran Jr. (D-Va.) and top brass from the White House, Secret Service, FBI and federal courts.

Internal Revenue Service Commissioner Charles O. Rossotti has been assigned No. 1040.

The charity fund-raiser is sponsored by the Sporting Goods Manufacturers Association.

Some very large egos are at stake, with prizes given for fastest teams (FBI and the Navy have dominated in the past) and for best and worst names. Example: The IPSO FASTO team headed by federal appeals court Judge Paul Michel.

Mike Causey's e-mail address is causeym@washpost.com

Tuesday, Sept. 14, 1999