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Stop, Look & Listen: Railroad Retirement Benefits Q&A

Answers are provided by Robert S. Kaufman

Changes in 60/30 Provision Introduced as HR 4844

(Posted February 10, 2000(Revised September 9, 2000))

Question 42: How soon will the proposed changes in the "60/30 provision" become law?

Answer: Recently an agreement was reached on changes to the Railroad Retirement System. The agreement was worked out between the major railroads and most(but not all) of the railway labor organizations. A bill has been drafted to incorporate the changes into the Railroad Retirement Act.

On July 14, it was introduced in the House of Repersentatives as HR 4844, and favorably report out by the Ways & Means Committee on July 25, 2000. On September 8, 2000 it was passed by the House.

Among the changes proposed is the elimination of the reduction when a rail worker with 30 or more years of service retires between ages 60 and 62. Vesting would be reduced from 10 years to 5 years for those employees with atleast five years of Rail service after 1995.

Other proposals include changes in the calculation of widow(er)s benefits, consolidation of the seperate Supplemental Railroad Retirement Trust Fund into the Regular Trust Fund, and reduction of payroll tax rates and the intoduction of an automatic rate adjustment mechanism.

The legislation would also expand the type of investments the Trust Fund could make for Tier 2 funds beyond U.S. government securities. An independent Board of Trustees would be set up to direct the investments. There would be seven trustees appointed by a unamious vote of the Railroad Retirement Board.

The fate and timing of the changes is uncertain at this point. The bill faces the many hurdles that Congressional legislation must overcome to become law. 2000 is an election year, so Congress probably will adjourn early.

Be sure to follow the progress of the proposed legislation through this column. Q&A-42 and Q&A--52 will be updated periodically as as important milestones occur.

Important notice:

Answers are provided as general guidance on the subjects covered in the question and are not provided as legal advice to the questioner or to readers. Any legal issues should be reviewed by your legal counsel to apply the law to the particular facts of this and similar situations.

The law in this area changes frequently. Answers are believed to be correct as of the posting dates shown. The completeness or accuracy of a particular answer may be affected by changes in the law (statutes, regulations, rulings, court decisions, etc.) that occur after the date on which a particular Q&A is posted.

Copyright 1997-2017 Robert S. Kaufman
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