Public Servants Protection and Fairness Act
This bill establishes an alternative formula to calculate Old-Age, Survivors, and Disability Insurance benefits for those who receive pensions for certain non-covered employment. (The existing formula is known as the windfall elimination provision.)
The alternative formula adjusts an individual's total lifetime earnings based on the proportion of covered earnings (i.e., earnings subject to Social Security payroll taxes). It applies to individuals who (1) first become eligible for benefits after 2021, (2) have earnings from non-covered service performed after 1977 and (3) have less than 30 years of coverage (i.e., years in which a beneficiary is considered to have contributed a substantial amount into the Social Security trust funds).
Beneficiaries receive the higher benefit amount as calculated under the alternative method or the existing formula. In addition, the bill provides rebates for certain beneficiaries currently impacted by the existing formula.
The Social Security Administration must include non-covered earnings in Social Security account statements, and the Government Accountability Office must study the availability of certain information related to retirement plans maintained by state and local governments.
[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4540 Introduced in House (IH)]
<DOC>
116th CONGRESS
1st Session
H. R. 4540
To amend title II of the Social Security Act to provide an equitable
Social Security formula for individuals with noncovered employment and
to provide relief for individuals currently affected by the Windfall
Elimination Provision.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
September 27, 2019
Mr. Neal introduced the following bill; which was referred to the
Committee on Ways and Means
_______________________________________________________________________
A BILL
To amend title II of the Social Security Act to provide an equitable
Social Security formula for individuals with noncovered employment and
to provide relief for individuals currently affected by the Windfall
Elimination Provision.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Public Servants Protection and
Fairness Act''.
SEC. 2. ALTERNATIVE FORMULA EQUALIZING BENEFITS FOR CERTAIN INDIVIDUALS
WITH NONCOVERED EMPLOYMENT.
(a) In General.--Section 215(a) of the Social Security Act (42
U.S.C. 415(a)) is amended by inserting after paragraph (7) the
following:
``(8)(A) In the case of an individual whose primary insurance
amount would be computed under paragraph (1) of this subsection--
``(i) who first becomes eligible for an old-age or
disability insurance benefit after 2021 and who subsequently
becomes entitled to such benefit;
``(ii) who has earnings derived from noncovered service
performed in a year after 1977 and is entitled to a monthly
periodic payment based on such earnings; and
``(iii) who has less than 30 years of coverage (as defined
for purposes of paragraph (7)(D)),
the primary insurance amount of such individual shall be the higher of
the amount computed or recomputed under paragraph (7) without regard to
this paragraph or the amount computed or recomputed under this
paragraph.
``(B) The primary insurance amount of an individual described in
subparagraph (A), as computed or recomputed under this paragraph, shall
be the product derived by multiplying--
``(i) the individual's primary insurance amount, as
determined under paragraph (1) of this subsection and
subparagraph (C) of this paragraph, by
``(ii) a fraction--
``(I) the numerator of which is the individual's
average indexed monthly earnings (determined without
regard to subparagraph (C)), and
``(II) the denominator of which is an amount equal
to the individual's average indexed monthly earnings
(as determined under subparagraph (C)),
rounded, if not a multiple of $0.10, to the next lower multiple of
$0.10.
``(C)(i) For purposes of determining an individual's primary
insurance amount and average indexed monthly earnings pursuant to
clauses (i) and (ii)(II) of subparagraph (B), the individual's average
indexed monthly earnings shall be determined by treating all recorded
noncovered earnings (as defined in clause (ii)(I)) derived by the
individual from noncovered service performed in each year after 1977 as
`wages' (as defined in section 209 for purposes of this title), which
shall be treated as included in the individual's adjusted total covered
earnings (as defined in clause (ii)(II)) for such calendar year
together with amounts consisting of `wages' (as so defined without
regard to this subparagraph) paid during such calendar year and self-
employment income (as defined in section 211(b)) for taxable years
ending with or during such calendar year.
``(ii) For purposes of this subparagraph:
``(I) The term `recorded noncovered earnings' means
earnings derived from noncovered service (other than noncovered
service as a member of a uniformed service (as defined in
section 210(m))) for which satisfactory evidence is determined
by the Commissioner to be available in the records of the
Commissioner.
``(II) The term `adjusted total covered earnings' means, in
connection with an individual for any calendar year, the sum of
the wages paid to the individual during such calendar year (as
adjusted under subsection (b)(3)) plus the self-employment
income derived by the individual during any taxable year ending
with or during such calendar year (as adjusted under subsection
(b)(3)).
``(iii) The Commissioner of Social Security shall provide by
regulation or other public guidance for methods for determining whether
satisfactory evidence is available in the records of the Commissioner
for earnings for noncovered service (other than noncovered service as a
member of a uniformed service (as defined in section 210(m))) to be
treated as recorded noncovered earnings. Such methods shall provide for
reliance on earnings information provided to the Commissioner by
employers and which, as determined by the Commissioner, constitute a
reasonable basis for treatment of earnings for noncovered service as
recorded noncovered earnings. In making determinations under this
clause, the Commissioner shall also take into account any documentary
or other evidence of earnings derived from noncovered service by an
individual which is provided by the individual to the Commissioner and
which the Commissioner considers appropriate as a reasonable basis for
treatment of such earnings as recorded noncovered earnings.
``(iv) In the case of any individual who, at the time of
application for old-age or disability insurance benefits under this
title, has recorded noncovered earnings in an amount the Commissioner
of Social Security determines may entitle the individual to a monthly
periodic payment based on such earnings (but whose application does not
report such a monthly periodic payment), the Commissioner shall
reconfirm with the individual whether such a monthly periodic payment
is being paid in order to ensure the proper application of paragraph
(7) and this paragraph.
``(D) Upon the death of an individual whose primary insurance
amount is computed or recomputed under this paragraph, such primary
insurance amount shall be computed or recomputed under paragraph (1) of
this subsection.
``(E) In the case of any individual whose primary insurance amount
would be computed under this paragraph who first becomes entitled after
1985 to a monthly periodic payment made by a foreign employer or
foreign country that is based in whole or in part upon noncovered
service, the primary insurance amount of such individual shall be
computed or recomputed under paragraph (7) or paragraph (1), as
applicable, for months beginning with the first month of the
individual's initial entitlement to such monthly periodic payment.''.
(b) Conforming Amendments.--Section 215(a)(7)(A) of such Act (42
U.S.C. 415(a)(7)(A)) is amended--
(1) by striking ``hereafter in this paragraph and in
subsection (d)(3)'' and inserting ``in this paragraph,
paragraph (8), and subsection (d)(3)''; and
(2) by striking ``shall be computed or recomputed'' and
inserting ``shall, subject to paragraph (8), be computed or
recomputed''.
(c) Effective Date.--The amendments made by this section shall
apply with respect to monthly insurance benefits payable on or after
January 1, 2022.
SEC. 3. ADDITIONAL MONTHLY PAYMENT FOR CERTAIN INDIVIDUALS WHOSE
BENEFIT AMOUNT IS REDUCED BY THE WINDFALL ELIMINATION
PROVISION.
(a) In General.--Section 215(a) of such Act (42 U.S.C. 415(a)), as
amended by section 2(a), is further amended by adding at the end the
following:
``(9)(A) For any month beginning at least 270 days after the date
of the enactment of the Public Servants Protection and Fairness Act,
the Commissioner of Social Security shall, subject to subparagraphs (D)
and (E), make an additional monthly payment to each individual who is
an eligible individual for such month, in an amount equal to the amount
determined under subparagraph (C) with respect to such eligible
individual.
``(B) For purposes of this paragraph, the term `eligible
individual' for a month means an individual (other than an individual
described in paragraph (8)(E)) who--
``(i) first becomes eligible for an old-age or disability
insurance benefit under this title before 2022; and
``(ii) is entitled to an old-age or disability insurance
benefit under this title for such month based on a primary
insurance amount that was computed or recomputed under
paragraph (7) (and not subsequently recomputed under any other
paragraph of this subsection).
For purposes of clause (i), an individual shall be deemed eligible for
a benefit for a month if, upon filing application therefor in such
month, the individual would be entitled to such benefit for such month.
``(C)(i) The amount determined under this paragraph with respect to
an eligible individual is $150, except that in any case in which the
amount by which the primary insurance amount of such eligible
individual that would be computed for the individual's initial
computation month under paragraph (1) of this subsection without regard
to paragraph (7) exceeds the amount of such primary insurance amount
computed or recomputed for such month under paragraph (7) is less than
$150, the amount determined under this paragraph shall equal the amount
of such excess.
``(ii) For purposes of this subparagraph, the term `initial
computation month' means, with respect to an individual, the later of--
``(I) the 1st month beginning at least 270 days after the
date of the enactment of the Public Servants Protection and
Fairness Act; or
``(II) the 1st month for which the individual's primary
insurance amount is computed or recomputed under paragraph (7).
``(D) In any case in which this title provides that no monthly
benefit under section 202 or 223 shall be paid to an individual for a
month, no additional monthly payment shall be paid to the individual
for such month. This subparagraph shall not apply in the case of an
individual whose monthly benefit under section 202 or 223 is reduced,
regardless of the amount of the reduction, based on--
``(i) the individual's receipt of other income or benefits
for such month; or
``(ii) the adjustment or recovery of an overpayment under
section 204.
``(E) Except for purposes of adjustment or recovery of an
overpayment under section 204, an additional monthly payment under this
paragraph shall not be subject to any reduction or deduction under this
title.
``(F) Whenever benefit amounts under this title are increased by
any percentage effective with any month as a result of a determination
made under subsection (i), each additional monthly payment amount
payable to an eligible individual under this paragraph shall be
increased by the same percentage for months beginning with such month.
``(G) The amount of any additional monthly payment under this
paragraph shall be disregarded for purposes of determining the
eligibility or benefit amount of an individual for supplemental
security income benefits payable under title XVI of the Social Security
Act, but only if such individual--
``(i) is eligible for a cash benefit payable under section
1611, section 1619(a), or section 1631(a)(7) for the 1st month
beginning at least 270 days after the date of the enactment of
the Public Servants Protection and Fairness Act;
``(ii) is an individual described in section 1619(b) for
such month; or
``(iii) is eligible for a State supplementary payment for
such month of the type referred to in section 1616(a) (or
payments of the type described in section 212(a) of Public Law
93-66) which are paid by the Commissioner under an agreement
referred to in section 1616(a) (or section 212(a) of Public Law
93-66).''.
(b) Effective Date.--The amendments made by this section shall
apply with respect to monthly insurance benefits payable for months
beginning at least 270 days after the date of the enactment of this
Act.
SEC. 4. IMPROVEMENT IN SOCIAL SECURITY ACCOUNT STATEMENTS FOR PUBLIC
SERVANTS.
(a) In General.--Section 1143(a) of the Social Security Act (42
U.S.C. 1320b-13(a)) is amended--
(1) in paragraph (2)--
(A) by redesignating subparagraphs (B) through (E)
as subparagraphs (C) through (F);
(B) by inserting after subparagraph (A) the
following:
``(B) the amount of earnings derived by the
eligible individual from service performed after 1977
which did not constitute employment (as defined in
section 210), not including service as a member of a
uniformed service (as defined in section 210(m)), as
shown by the records of the Commissioner at the date of
the request;''; and
(C) in subparagraph (E) (as redesignated by
subparagraph (A)), by inserting ``(in the case of an
eligible individual described in paragraph (3)(C)(ii),
calculated using a primary insurance amount estimated
pursuant to paragraph (8) of section 215(a) and
including a notation indicating the use of such method
of calculation)'' after ``account''.
(2) in paragraph (3)(C)(ii)--
(A) by striking ``wages or self-employment income''
and inserting ``wages, self-employment income, and
earnings derived from noncovered service (within the
meaning of section 215(a)(7))''; and
(B) by striking ``of noncovered employment'' and
inserting ``that the individual's primary insurance
amount will be computed under paragraph (7) or (8) of
section 215(a)''.
(b) Conforming Amendments.--Section 1143 of the Social Security Act
(42 U.S.C. 1320b-13) is amended--
(1) in subsection (a)(2)(F) (as redesignated by subsection
(a)(1)(A) of this section), by striking ``sections 202(k)(5)
and 215(a)(7)'' and all that follows through ``auxiliary
benefits'' and inserting ``sections 202(k)(5), 215(a)(7), and
215(a)(8)''; and
(2) in subsection (d)(1)--
(A) by striking ``maximum''; and
(B) by striking ``section 215(a)(7)'' and inserting
``sections 215(a)(7) and 215(a)(8)''.
(c) Effective Date.--The amendments made by this section shall
apply with respect to Social Security account statements issued on or
after January 1, 2022.
SEC. 5. STUDY ON AVAILABILITY OF INFORMATION RELATING TO RETIREMENT
PLANS.
(a) In General.--The Comptroller General shall conduct a study to
determine the extent to which State and local governments (or their
designees) that maintain retirement plans for their employees possess
or otherwise have access to information sufficient to determine what
amount of a participant's benefits under such plan are based on
noncovered service (within the meaning of section 215(a)(7) of the
Social Security Act (42 U.S.C. 415(a)(7))).
(b) Report.--Not later than 2 years after the date of the enactment
of this Act, the Comptroller General shall submit a report to the
Committee on Ways and Means of the House of Representatives and the
Committee on Finance of the Senate on the results of the study
described in subsection (a).
SEC. 6. HOLD HARMLESS FOR THE SOCIAL SECURITY TRUST FUNDS.
There are appropriated, out of any moneys in the Treasury not
otherwise appropriated, to each of the Federal Old-Age and Survivors
Insurance Trust Fund and the Federal Disability Insurance Trust Fund
for each fiscal year such amounts as the chief actuary of the Social
Security Administration shall certify are necessary to place each such
Trust Fund in the same position at the end of such fiscal year as it
would have been in if the amendments made by this Act had not been
enacted.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Ways and Means.
Referred to the Subcommittee on Social Security.
Llama 3.2 · runs locally in your browser
Ask anything about this bill. The AI reads the full text to answer.
Enter to send · Shift+Enter for new line