S 113
112th CONGRESS
1st Session
S. 113
To amend title II of the Social Security Act to repeal the
windfall elimination provision and protect the retirement of public
servants.
IN THE SENATE OF THE UNITED STATES
January 25 (legislative day, January 5), 2011
Mrs. HUTCHISON introduced the following bill; which was read twice
and referred to the Committee on Finance
A BILL
To amend title II of the Social Security Act to repeal the
windfall elimination provision and protect the retirement of public
servants.
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 Servant Retirement Protection Act
of 2011'.
SEC. 2. REPEAL OF CURRENT WINDFALL ELIMINATION PROVISION.
Paragraph (7) of section 215(a) of the Social Security Act (42 U.S.C.
415(a)(7)) is repealed.
SEC. 3. REPLACEMENT OF THE WINDFALL ELIMINATION PROVISION WITH A FORMULA
EQUALIZING BENEFITS FOR CERTAIN INDIVIDUALS WITH NON-COVERED EMPLOYMENT.
(a) Substitution of Proportional Formula for Formula Based on Covered
Portion of Periodic Benefit-
(1) IN GENERAL- Section 215(a) of the Social Security Act (as amended
by section 2 of this Act) is amended further by inserting after paragraph
(6) the following new paragraph:
`(7)(A) In the case of an individual whose primary insurance amount
would be computed under paragraph (1) of this subsection, who--
`(i) attains age 62 after 1985 (except where he or she became entitled
to a disability insurance benefit before 1986 and remained so entitled
in any of the 12 months immediately preceding his or her attainment
of age 62), or
`(ii) would attain age 62 after 1985 and becomes eligible for a disability
insurance benefit after 1985,
and who first becomes eligible after 1985 for a monthly periodic payment
(including a payment determined under subparagraph (F), but excluding
(I) a payment under the Railroad Retirement Act of 1974 or 1937, (II)
a payment by a social security system of a foreign country based on
an agreement concluded between the United States and such foreign country
pursuant to section 233, and (III) a payment based wholly on service
as a member of a uniformed service (as defined in section 210(m)) which
is based in whole or in part upon his or her earnings for service which
did not constitute `employment' as defined in section 210 for purposes
of this title (hereafter in this paragraph and in subsection (d)(3)
referred to as `noncovered service')), the primary insurance amount
of that individual during his or her concurrent entitlement to such
monthly periodic payment and to old-age or disability insurance benefits
shall be 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--
`(i) in the case of an individual who first performs noncovered service
after the 12th calendar month following the date of the enactment
of the Public Servant Retirement Protection Act of 2011, the primary
insurance amount determined under subparagraph (C), or
`(ii) in the case of an individual who has performed noncovered service
during or before the 12th calendar month following the date of the
enactment of the Public Servant Retirement Protection Act of 2011,
the larger of--
`(I) the primary insurance amount determined under subparagraph
(C), or
`(II) the primary insurance amount determined under subparagraph
(E).
`(C) An individual's primary insurance amount determined under this
subparagraph shall be the product derived by multiplying--
`(i) the individual's primary insurance amount, as determined under
paragraph (1) of this subsection and subparagraph (D) of this paragraph,
by
`(I) the numerator of which is the individual's average indexed
monthly earnings (determined without regard to subparagraph (D)),
and
`(II) the denominator of which is an amount equal to the individual's
average indexed monthly earnings (as determined under subparagraph
(D)),
rounded, if not a multiple of $0.10, to the next lower multiple of $0.10.
`(D)(i) For purposes of determining an individual's primary insurance
amount pursuant to clauses (i) and (ii)(II) of subparagraph (C), the
individual's average indexed monthly earnings shall be determined, subject
to clause (ii), by treating all recorded noncovered earnings (as defined
in clause (iii)(I)) derived by the individual from noncovered service
performed in each year after 1950 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
(iii)(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) In any case in which some or all of the earnings derived from
noncovered service performed by an individual during any calendar year
after 1950 are not recorded noncovered earnings (as defined in clause
(iii)(I)), for purposes of determining the individual's average indexed
monthly earnings as described in clause (i), the amount of the individual's
adjusted total covered earnings (as defined in clause (iii)(II)) for
such calendar year shall be deemed to be, in lieu of the amount determined
without regard to this clause, an amount equal to the quotient derived
by dividing--
`(I) the sum of all adjusted total covered earnings (determined without
regard to this clause) of the individual for all calendar years after
1950, plus all recorded noncovered earnings which are paid to the
individual during such calendar years (after adjustment under subsection
(b)(3) as if such earnings were wages), by
`(II) the number of calendar years after 1950 for which there are,
with respect to the individual, any earnings described in subclause
(I).
`(iii) 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)).
`(iv) The Commissioner of Social Security shall provide by regulation
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 which
is 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 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, except that such evidence provided by the individual shall
be taken into account only to the extent that such evidence does not
relate to earnings for service with respect to which information regarding
earnings has already been obtained by the Commissioner from the employer
and only to the extent that such evidence does not result in a reduction
in the individual's primary insurance amount as calculated under subparagraph
(C).
`(E)(i) For purposes of determining the primary insurance amount under
this subparagraph pursuant to subparagraph (B)(ii)(II)--
`(I) there shall first be computed an amount equal to the individual's
primary insurance amount under paragraph (1) of this subsection, except
that for purposes of such computation the percentage of the individual's
average indexed monthly earnings established by subparagraph (A)(i)
of paragraph (1) shall be the percent specified in clause (ii), and
`(II) there shall then be computed (without regard to this paragraph)
a second amount, which shall be equal to the individual's primary
insurance amount under paragraph (1) of this subsection, except that
such second amount shall be reduced by an amount equal to one-half
of the portion of the monthly periodic payment which is attributable
to noncovered service performed after 1956 (with such attribution
being based on the proportionate number of years of such noncovered
service) and to which the individual is entitled (or is deemed to
be entitled) for the initial month of his or her concurrent entitlement
to such monthly periodic payment and old-age or disability insurance
benefits.
An individual's primary insurance amount determined under this subparagraph
shall be the larger of the two amounts computed under this clause (before
the application of subsection (i)).
`(ii) For purposes of clause (i), the percent specified in this clause
is--
`(I) 80.0 percent with respect to individuals who become eligible
(as defined in paragraph (3)(B)) for old-age insurance benefits (or
became eligible as so defined for disability insurance benefits before
attaining age 62) in 1986;
`(II) 70.0 percent with respect to individuals who so become eligible
in 1987;
`(III) 60.0 percent with respect to individuals who so become eligible
in 1988;
`(IV) 50.0 percent with respect to individuals who so become eligible
in 1989; and
`(V) 40.0 percent with respect to individuals who so become eligible
in 1990 or thereafter.
`(F)(i) Any periodic payment which otherwise meets the requirements
of subparagraph (A), but which is paid on other than a monthly basis,
shall be allocated on a basis equivalent to a monthly payment (as determined
by the Commissioner of Social Security), and such equivalent monthly
payment shall constitute a monthly periodic payment for purposes of
this paragraph.
`(ii) In the case of an individual who has elected to receive a periodic
payment that has been reduced so as to provide a survivor's benefit
to any other individual, the payment shall be deemed to be increased
(for purposes of any computation under this paragraph or subsection
(d)(3)) by the amount of such reduction.
`(iii) For purposes of this paragraph, the term `periodic payment' includes
a payment payable in a lump sum if it is a commutation of, or a substitute
for, periodic payments.
`(G)(i) In any case in which the primary insurance amount would otherwise
be calculated under subparagraph (E)--
`(I) this paragraph shall not apply in the case of an individual who
has 30 years or more of coverage; and
`(II) in the case of an individual who has more than 20 years of coverage
but less than 30 years of coverage (as so defined), the percent specified
in the applicable subdivision of subparagraph (E)(ii) shall (if such
percent is smaller than the applicable percent specified in the following
table) be deemed to be the applicable percent specified in the following
table:
`If the number of the
individual's years of
The applicable
coverage (as so defined) is:
percentage is:
29
--85
28
--80
27
--75
26
--70
25
--65
24
--60
23
--55
22
--50
21
--45.
`(ii) For purposes of clause (i), the term `year of coverage' shall
have the meaning provided in paragraph (1)(C)(ii), except that the reference
to `15 percent' therein shall be deemed to be a reference to `25 percent'.
`(H) An individual's primary insurance amount determined under this
paragraph shall be deemed to be computed under paragraph (1) of this
subsection for the purpose of applying other provisions of this title.
`(I) This paragraph shall not apply in the case of an individual whose
eligibility for old-age or disability insurance benefits is based on
an agreement concluded pursuant to section 233 or an individual who
on January 1, 1984--
`(i) is an employee performing service to which social security coverage
is extended on that date solely by reason of the amendments made by
section 101 of the Social Security Amendments of 1983; or
`(ii) is an employee of a nonprofit organization which (on December
31, 1983) did not have in effect a waiver certificate under section
3121(k) of the Internal Revenue Code of 1954 and to the employees
of which social security coverage is extended on that date solely
by reason of the amendments made by section 102 of that Act, unless
social security coverage had previously extended to service performed
by such individual as an employee of that organization under a waiver
certificate which was subsequently (prior to December 31, 1983) terminated.'.
(2) CONFORMING AMENDMENTS-
(A) Section 215(d)(3) of such Act (42 U.S.C. 415(d)(3)) is amended--
(i) in the first sentence, by striking `subsection (a)(7)(C)'
each place it appears and inserting `subsection (a)(7)(F)'; and
(ii) in the second sentence--
(I) by striking `subparagraph (E)' and inserting `subparagraph
(I)'; and
(II) by striking `subparagraph (D)' and inserting `subparagraph
(G)(i)'.
(B) Section 215(f)(9)(A) of such Act (42 U.S.C. 415(f)(9)(A)) is
amended by striking `(a)(7)(C)' and inserting `(a)(7)(F)'.
SEC. 4. EFFECTIVE DATE.
The amendments made by this Act shall apply with respect to monthly
insurance benefits for months commencing with or after the 12th calendar
month following the date of the enactment of this Act. Notwithstanding
section 215(f) of the Social Security Act, the Commissioner of Social
Security shall recompute primary insurance amounts to the extent necessary
to carry out the amendments made by this Act.
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