107-10
December 14, 2001
House Passage of H.R. 10
The Comprehensive
Retirement Security and Pension Reform Act of 2001
On December 11, 2001, the House, by a vote of 369-33, passed H.R.
10, the Comprehensive Retirement Security and Pension Reform Act of
2001. H.R. 10 was returned to the House after the Senate amended the
bill on December 5, 2001 by striking the existing text and
substituting the language of the House-passed version of H.R. 1140.
The measure is now cleared for the President's signature.
Under the bill, Social Security benefit payments would be
certified for payment by the Railroad Retirement Board (RRB) on the
records of workers with either 10 years of service covered under the
Railroad Retirement Act or 5 years of such covered service accrued
after December 31, 1995. (SSA will have to identify and review any
cases now paid by SSA that may have to be certified for payment by
the RRB effective January 1, 2002.) The bill would have no effect on
the long-range financial status of the Social Security program.
Specific bill provisions follow.
Amendments to Railroad Retirement Act of 1974
- Would increase benefits to railroad employees and their
beneficiaries and to revise financing of the pension part (tier 2)
of the railroad retirement system.
- Would provide for a guaranteed initial minimum amount for
surviving spouses of deceased railroad employees. Bases such
amount on the tier 1 and tier 2 benefit that would have been
payable to the employee at the time of the award of the surviving
spouse's annuity.
- Would repeal the reduction in tier 1 annuity components for
employees and spouses prior to age 62, thus providing for full
tier 1 annuities to employees at age 60 with 30 years of service
and to spouses of employees with 30 years of service at age 60.
- Would reduce the vesting requirement for railroad retirement
benefits for employees and survivors to 5 (currently 10) years of
service, based on service after 1995. Sets forth computation
formulas for individual annuities through railroad retirement and
Social Security benefit systems.
- Would repeal a maximum limit on annuity benefits payable to an
employee and spouse under the railroad retirement system.
- Would establish a Railroad Retirement Trust Fund (the Fund)
and a Railroad Retirement Investment Trust to manage and invest
Fund assets.
- Would abolish the Railroad Retirement Supplemental Annuity
Account and provides for transfer of its funds to the Fund.
Provides for transfer to the Fund of certain portions of the
Railroad Retirement Account and of Social Security Equivalent
Benefit account funds.
- Would transfer to the disbursing agent from the Dual Benefits
Payments Account the amount necessary to make dual benefit
payments.
- Would require the Railroad Retirement Board to calculate the
ratio of assets to benefits to determine annual tier 2 tax rates
for employers, employee representatives, and employees.
Amendments to the Internal Revenue Code of 1986
- Would amend the Internal Revenue Code to exempt the Fund from
taxation.
- Would repeal a supplemental annuity tax that railroad
employers pay to finance a benefit for long-time rail employees.
- Would provide for adjustments to railroad employers, employee
representatives, and employee tier 2 tax rates.
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