Congress gears up to debate pay raise


WASHINGTON -- When lawmakers return from their Independence Day recess next week, they'll find some political hot potatoes waiting for them.

Among the smoldering spuds -- a proposed pay raise for federal workers. The size of the pay raise for the next fiscal year is in dispute on Capitol Hill, where a decision is expected once Congress reconvenes July 11.

Debate over the raise has been heated, with the House approving a much higher raise than the Senate. The House would boost salaries 2.6 percent, while the Senate would raise pay by 1.6 percent. Government agencies would have to absorb the cost of the higher House raise, which would apply to Maryland's nearly 300,000 federal workers.

Which figure will win out? Congress watchers are putting their money on the bigger sum, mainly because it has the tentative support of then-Budget Director Leon Panetta.

Meanwhile, some observers contend that the Senate may have backed the lower pay raise to create a bargaining chip for itself during House-Senate negotiations.

Sen. Dennis DeConcini, D-Ariz., who sought the lower raise, wants to enact a new law enforcement pay system not included in the House bill. He may grant key concessions to the House to secure his law enforcement plan -- and that could include a higher pay raise.

"[Mr. DeConcini] will want that in the final bill so he'll probably be trading for it," says Nick Nolan, executive director of the Federal Government Service Task Force.

Mr. DeConcini says he hopes the conferees will find enough money for the higher raise but he's not certain Congress can fund it.

"We've done raises here -- and I've been guilty of it -- it's just assumptions and absorptions," he said recently. "That's really not fair to do."

The pay raise is part of a fiscal 1995 spending bill for the Treasury Department, the U.S. Postal Service and other federal agencies. House-Senate conferees may wait to consider the raise until lawmakers draft a compromise on the crime bill.

Military retirees secured a victory last week when the Senate voted to move up the delivery date of cost-of-living adjustments (COLAs).

The Senate passed an amendment that requires military and civilian COLAs to begin the same month next year, instead of six months later for military retirees. The Senate approved the amendment to the fiscal 1995 Defense Authorization Bill, co-sponsored by Sens. John Warner, R-Va., and Paul Sarbanes, D-Md., in an 88-12 vote July 1.

This year, military and civilian retirees waited until April to collect their COLAs instead of receiving their benefits at the beginning of the year. The spring start-up date is in place for civilian COLAs in 1995 and 1996, but a fall start-up date was sought for military COLAs.

The Warner-Sarbanes amendment allows military and civilian COLAs to kick in at the same time next year -- April 1.

Lawmakers argued that delaying the start of COLAs from the traditional Jan. 1 date could save more than $3 billion over five years.

But the policy came under fire by some lawmakers who said former military personnel were being robbed to pay civilian retirees.

"I think it is not the right message to send to active-duty personnel, or people considering going into the military, that they are going to be treated this way in their retirement years," Mr. Sarbanes said. "It has potentially serious implications for troop morale as well as for recruitment and retention."

But moving up the COLA starting date for military retirees will cost money.

The Senate bill aims to pay for the change by requiring the Department of Defense to transfer $374 million from the fund it now uses to pay for rent and office supplies.

The House passed a nearly identical COLA measure last month. The defense authorization bill now goes to a House-Senate conference committee.

Going, going . . . gone.

That's the status of many federal agency buyout plans, which offer employees up to $25,000 to leave the federal work force.

As of June 30, 16,293 employees had applied for buyouts, but agencies had authorization for 15,526, according to the Office of Personnel Management (OPM). This is 10.8 percent more applications than there were buyouts available, OPM says.

The buyouts will be offered again in the fall as part of the Clinton administration effort to downsize government. In October, federal agencies will give 50,000 to 70,000 workers a chance to make a paid exit from government ranks.

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