Equal Treatment of Public Servants Act of 2023
Floor Speech
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Mr. ARRINGTON. Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 5342) to amend title II of the Social Security Act to replace the windfall elimination provision with a formula equalizing benefits for certain individuals with noncovered employment, and for other purposes.
The Clerk read the title of the bill.
The text of the bill is as follows: H.R. 5342
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 ``Equal Treatment of Public Servants Act of 2023''. SEC. 2. REPLACEMENT OF THE WINDFALL ELIMINATION PROVISION WITH A 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 2067,
``(ii) who subsequently becomes entitled to such benefit, and
``(iii) who has earnings derived from noncovered service performed in a year after 1977, the primary insurance amount of such individual shall be 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 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 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 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.
``(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) in clause (i)--
(A) by striking ``after 1985'' and inserting ``after 1985 and before 2068''; and
(B) by striking ``or'' at the end;
(2) in clause (ii)--
(A) by striking ``after 1985'' each place it appears and inserting ``after 1985 and before 2068''; and
(B) by adding ``or'' at the end;
(3) by inserting after clause (ii) the following:
``(iii) is an individual described in paragraph (8)(E),''; and
(4) by striking ``hereafter in this paragraph and in subsection (d)(3)'' and inserting ``in this paragraph, paragraphs (8) and (9), and subsection (d)(3)''.
(c) Effective Date.--The amendments made by this section shall apply with respect to monthly insurance benefits payable on or after January 1, 2025. SEC. 3. BENEFIT CALCULATION DURING TRANSITION PERIOD.
(a) In General.--Section 215(a) of the Social Security Act (42 U.S.C. 415(a)), as amended by section 2, is further amended by inserting after paragraph (8) the following:
``(9) In the case of an individual whose primary insurance amount would be computed under paragraph (1) of this subsection--
``(A) who first becomes eligible for an old-age or disability insurance benefit after 2024 and before 2068,
``(B) who subsequently becomes entitled to such benefit, and
``(C) who has earnings derived from noncovered service performed in a year after 1977, 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 that would be computed or recomputed under paragraph (8) if the individual were an individual described in subparagraph (A) of such paragraph.''.
(b) Conforming Amendment.--Section 215(a)(7)(A) of such Act (42 U.S.C. 415(a)(7)(A)), as amended by section 2(b), is further amended by striking ``shall be computed or recomputed'' and inserting ``shall, subject to paragraph (9), 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, 2025. SEC. 4. ADDITIONAL MONTHLY PAYMENT FOR 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 sections 2 and 3, is further amended by adding at the end the following:
``(10)(A) For any month beginning at least 270 days after the date of enactment of the Equal Treatment of Public Servants Act of 2023, the Commissioner of Social Security shall, subject to subparagraphs (C) and (D), make an additional monthly payment of $100 to each individual who is an eligible individual for such month, and an additional monthly payment of $50 to each individual (other than an eligible individual) who is entitled to a benefit under section 202 for such month on the basis of the wages and self-employment income of such eligible individual.
``(B) For purposes of this paragraph, the term `eligible individual' for a month means an individual who--
``(i)(I) first becomes eligible for an old-age or disability insurance benefit under this title before 2025, or
``(II) is an individual described in paragraph (8)(E), 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).
``(C) 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 the individual's receipt of other income or benefits for such month or the application of section 203(a) or due to the adjustment or recovery of an overpayment under section 204.
``(D)(i) An individual is not entitled to receive more than one additional monthly payment for a month under this paragraph.
``(ii) An eligible individual who is entitled to a benefit under section 202 on the basis of the wages and self- employment income of another eligible individual for a month shall receive an additional monthly payment under this paragraph in the amount of $100 for such month.
``(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 of the dollar amounts in subparagraph (A) shall be increased by the same percentage for months beginning with such month.''.
(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 enactment of this Act. SEC. 5. REPORTING OF NONCOVERED EARNINGS ON SOCIAL SECURITY ACCOUNT STATEMENTS.
(a) In General.--Section 1143(a)(2) of the Social Security Act (42 U.S.C. 1320b-13(a)(2)) is amended--
(1) by redesignating subparagraphs (B) through (E) as subparagraphs (C) through (F); and
(2) 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;''.
(b) Effective Date.--The amendments made by this section shall apply with respect to Social Security account statements issued on or after January 1, 2025. SEC. 6. STUDY ON PARTNERING WITH STATE AND LOCAL PENSION SYSTEMS.
(a) Study.--
(1) In general.--The Commissioner of Social Security shall study and test the administrative feasibility of partnering with State and local pension systems, or other governmental entities, to improve the collection and sharing of information relating to State and local noncovered pensions.
(2) Coordination with state and local pension systems.--In conducting the study described in paragraph (1), the Commissioner shall coordinate with State and local pension systems that reflect the diversity of systems and individual experiences to explore the development of automated data exchange agreements that facilitate reporting of information relating to noncovered pensions.
(b) Report.--The Commissioner of Social Security shall conclude the study described in subsection (a) not later than 4 years after the date of enactment of this Act. As soon as possible after conclusion of the study and not later than 4\1/2\ years after the date of enactment of this Act, the Commissioner shall submit to the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate a report on the results of the study. Such report shall include the following:
(1) A discussion of how the automated data exchange agreements could be implemented to cover noncovered pensions nationally, including the range of implementation timelines across State and local pension systems, or with other governmental entities.
(2) An analysis of the barriers to developing automated data exchange agreements and lessons learned that can help address these barriers.
(3) A description of alternative methods for obtaining information related to noncovered pensions, and an analysis of the barriers to obtaining noncovered pension data through such methods.
(4) An explanation of how coverage information is obtained by the Social Security Administration when an individual purchases service credits to apply to a new covered or noncovered pension after moving from another covered or noncovered pension within the State or in another State.
(5) An estimate of the total amount, as of the date of the enactment of this Act, of noncovered pensions not reported to the Social Security Administration as a result of noncompliance with voluntary reporting policies.
(c) State and Local Pension Information To Be Requested by the Commissioner.--Section 202 of the Social Security Act (42 U.S.C. 402) is amended by inserting after subsection (l) the following:
``(m) State and Local Pension Information To Be Requested by the Commissioner.--
``(1) The Commissioner may partner with States to request information, including the information specified in paragraph (2), with respect to any designated distribution (as defined in section 3405(e)(1) of the Internal Revenue Code of 1986) from an employer deferred compensation plan (as defined in section 3405(e)(5) of such Code) of the State (or political subdivision thereof) to a participant of such plan in any case in which any portion of such participant's earnings for service under such plan did not constitute `employment' as defined in section 210 for purposes of this title.
``(2) The information specified in this paragraph is the following:
``(A) The name and Social Security account number of the participant receiving the designated distribution.
``(B) The dollar amount of the designated distribution and the date paid.
``(C) The date on which the participant initially became eligible for a designated distribution under the plan and, if different, the date of payment of the initial designated distribution.
``(D) The dates of each period of service under the plan that did not constitute `employment' as defined in section 210 for purposes of this title, and the dates of any other period of service under the plan.''.
(d) Definitions.--In this section--
(1) the term ``noncovered pension'' means a pension any part of which is based on noncovered service (within the meaning of section 215(a)(7) of the Social Security Act (42 U.S.C. 415(a)(7))); and
(2) the term ``covered pension'' means any other pension.
Mr. Speaker, we have a great injustice that has persisted now for four decades. Some of our hardest working fellow Americans who are public servants in certain States where they have non-Social Security covered employment--or to say it this way, where they have teacher retirement systems separate from Social Security, or firefighter retirement systems separate from Social Security--have what is called a windfall elimination provision in the Social Security law, which has shortchanged roughly 2 million hardworking public servants.
Some people are still getting a windfall, but the vast majority are not getting what they earned and what they put into the Social Security system. So my colleague, Representative John Larson, who I serve with on the Committee on Ways and Means, and who I consider a dear friend and someone who I know is very passionate about fixing Social Security's insolvency, which looms large over the next 10 years, this is but one element of what is not working in Social Security for our retirees and Social Security recipients.
To solve this inequity and injustice, some of my colleagues have decided they would just repeal the windfall elimination provision altogether. That sounds good, but it is going to cost $192 billion to do that. We shouldn't be constrained by cost to do the right thing, but to repeal the windfall elimination provision would go back to pre-1983 when we had a windfall to certain Americans in the same States where they had independent retirement systems, and we were spending more money for certain retirees than they put into the Social Security system.
There was a great discrepancy and inequity between these individuals in these States and the vast majority of the tens of millions of other retirees across the country. So you had a teacher or a firefighter in certain States, like Texas, pre-1983 getting a windfall, large sums of money, over similarly situated people in other States. Firefighters and teachers are doing the same work, making roughly the same amount of money, but getting less benefits.
What we should do is fix the inadequacy of the windfall elimination provision that was oversimplified and did not use the data that we have today and make sure that people are paid what they are owed in terms of their benefits, but not revert back to pre-windfall elimination provision, where we were spending tens of billions of dollars more than we needed to according to what people put in it.
Why does that matter? Because we should have a system of fairness for every public servant in every State, every retiree who fits that definition. It is also because if we start just throwing money at this and allowing windfall payments to certain retirees, we are going to accelerate the insolvency of the Social Security trust fund.
One outside expert says that we will accelerate that if we go to H.R. 82 and just pull the plug on the windfall elimination provision, as opposed to fixing it and getting it right. We will accelerate it by 6 months.
We should be responsible in how we do this. We should consider retirees in every State, and we should also consider future retirees because what we do and how we solve problems doesn't just impact the people who have been shortchanged, and we need to deal with that, but we will impact future retirees, as well.
I am simply asking my colleagues to do the right thing, address this inequity with WEP and our public servants, but do it the right way so that we don't compromise the integrity and the fiscal responsibility of managing the trust fund and put these public servants now once again at odds with the vast majority of public servants who are retired.
Mr. Speaker, that is a mouthful, by the way. This is a complex issue, but what is not complicated is people who have been shortchanged need to get the money that they rightfully are owed by their government. I can start there and say that Democratic and Republican colleagues alike agree on that, but my bill will do it in a fiscally responsible way.
I think this H.R. 82 is well-intended, but it is going to accelerate the bankruptcy of Social Security. That is not good for anybody, current or future retirees.
My friend mentioned my seniors in west Texas. Let me tell you what they sent me here to do. They sent me here to be an advocate for them, to ensure that we have fair and just laws, to fix what is broken about Social Security but do it in a way that we don't accelerate what will be an automatic cut in less than 10 years.
By repealing the windfall that existed before 1983, you are saying you are okay with taxpayers just spending more money than they should, more money than what has been earned and owed to the seniors, and in a way that creates a vast and tremendous discrepancy and inequity between 2 million people in several States as opposed to almost 60 million across the country.
How unfair and how nearsighted and narrow-minded can we be not to consider the fact that we will have a bankrupt system and that we have future seniors who can't bank on their retirement because we want to go back to prewindfall? It doesn't make sense, Mr. Speaker.
The Democrats had control of this place from top to bottom from 2020 to 2022, and they didn't fix it. Republicans had control when I was a freshman in 2017. Let me tell the world: They didn't fix it. The only way we are going to fix it is if we come together. I agree with Mr. Larson that there are broader provisions to look at and the system as a whole to address going forward.
You mentioned benefits. That is a great place to do it, but to suggest that we are going to go back prewindfall elimination provision and have a $2,500 additional cut in 2033 because we are not doing it the right way and responsible way and equitable way because we now have the data, I just think is egregiously irresponsible for all parties involved, including our children, who don't have much of a say in this, even though they own the deferred tax on all of these programs that are bankrupt, including Medicare.
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Mr. ARRINGTON. Mr. Speaker, this will be budget neutral over 75 years for the trust fund, according to the actuaries, and I thank Mr. Roy for his comments.
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Mr. ARRINGTON. I thank the gentleman from Missouri for his comments. I don't know that I could add anything more to what he said. We are trying to fix this inequity that exists with this subset of the retirement or Social Security beneficiary population.
I agree with Mr. Larson that we need a broader debate on Social Security, and we had better hurry up because it will be insolvent in less than 10 years, so we need to talk about the solvency and sustainability, the entirety of the program, the pay-fors, programmatic reforms, and the benefits. All of it should be on the table.
That is why as budget chair, I passed a bipartisan fiscal commission that would look at that and also at Medicare, which is another important safety net for seniors. However, we are talking about one specific subset.
I love the gentleman's passion, and I hope that we can get thoughtful Members on both sides of the aisle, like my friend, to sit at the table and do the right, the responsible, and the mature thing and actually work on a compromise solution like Ronald Reagan and Tip O'Neill did, and I will bet the gentleman agrees with that.
However, we are not talking about the entirety of Social Security. We are talking about this subset, this subset of people affected by WEP. It is about 2 million people. I want to fix that for them. I want them to get the money they have earned, because the windfall elimination provision wasn't adequate. It didn't use good information. We still have people who are shortchanged.
We still have people getting a windfall, albeit less, when we have the ability, the wherewithal, the tools, and the data to actually fix it without just eliminating WEP and going back to where the inequity is greater than what it is today.
That is because if the public servants of my State and the gentleman's State would get more than they put into Social Security, then we accelerate the insolvency. Then we add to the cuts that will be automatic on seniors that would be $2,500 in 2033, and we give almost no peace of mind and hope for future seniors and our children and grandchildren that this important antipoverty safety net program for seniors will still be there when they need it.
Mr. Speaker, it is too easy just to throw money at every problem up here when you are borrowing from China, and you have a $2 trillion deficit that will double in 10 years. We have higher levels of indebtedness than we had when we were fighting Imperial Japan and Nazi Germany.
This country is going to go into the fiscal ditch never to come out, never to prosper, never to be offered the American promise, and never to lead the free world because we are going to bankrupt it because we don't know how to address these problems like every American does in their own household, in their businesses, and at the State and local level, and that is conducting their business within their means and not like there is a money tree at the Treasury Department where they can borrow ad infinitum. That is not reality. That is not reality.
Let's fix it. Let's do it the right way. Let's not add to the debt. Let's not add to the inequity. Let's not accelerate the trust fund insolvency.
Then let's do what the gentleman said. I agree with the gentleman. Let's be men and women who love this country and are more concerned with solving these big problems than staying up here and being called Congressman and chairman. Let's do the people's business. I am ready. I am ready.
This is a very finite subset, and we have the solution. It is not perfect, but it balances the things that need to be balanced like these folks up there would at their homes and like my parents have to do back home in Plainview, Texas.
Taxpayers deserve a voice as much as seniors, and my children deserve a voice as much as taxpayers. That is what we are trying to do here.
I hope we can get my friend's support. I feel like that is about as compelling a pitch I can make. I think John Larson ought to come over and fix this the right way with me, then let's get that fiscal commission going, get our President to lean into this and do the Reagan-Tip O'Neill grand bargain so we can actually solve the bigger and broader issues that plague Social Security.
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Mr. ARRINGTON. Mr. Speaker, only in Washington, D.C., and, unfortunately--I respect my Democrat colleague and many of my Democrat colleagues--only from the Democrat side of the aisle could I hear that paying above and beyond what we defined as an earned benefit and has now become a windfall for 2 million people at the expense of 60 million people who don't receive the same benefit so that we can give people equal treatment and not accelerate the insolvency, only in this town could I hear that as a solution. That is not a solution. It is a bad plan. Let's have the broader debate about Social Security, which is what the gentleman is suggesting, but let's fix this.
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Mr. ARRINGTON. Mr. Speaker, on that I demand the yeas and nays.
The yeas and nays were ordered.
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