US Postal Service 2003 Annual Report Download - page 52

50 | 2003 annual report united states postal service
notes to the
financial statements
Federal Financing Bank (FFB) may be repurchased at
current value at any time with five days’ notice of
intent to do so.
6retirement programs
Our employees, retirees and their survivors partici-
pate in a pension program of the U.S. government. As
an “independent establishment” of the U.S. govern-
ment, we account for our involvement in these
programs as participation in a multi-employer plan
arrangement, in accordance with the Statement of
Financial Accounting Standards (FAS) 87, Employers’
Accounting for Pensions.
With certain exceptions, employees participate in one
of the following three retirement programs based
upon the starting date of their employment with the
Postal Service. Employee and employer contributions
are made to the Civil Service Retirement System, the
Dual System or the Federal Employees Retirement
System, which are administered by the Office of
Personnel Management. Employees may also partic-
ipate in the Thrift Savings Plan, which is a defined
contribution retirement savings and investment plan.
Postal Service employees are authorized to partici-
pate in the Thrift Savings Plan by the Federal
Employees Retirement System Act of 1986. The Plan
is administered by the Federal Retirement Thrift
Investment Board.
Civil Service Retirement System (CSRS)
Under the Postal Reorganization Act, officers and
career employees hired prior to January 1, 1984 are
covered by the Civil Service Retirement System,
which provides a basic annuity. We do not match
contributions to the Thrift Savings Plan for employees
who participate in CSRS.
Dual Civil Service Retirement System (Dual
CSRS/Social Security System)
Employees with prior U.S. government service who
were hired between January 1, 1984, and January 1,
1987, are covered by the Dual Civil Service
Retirement System/Social Security System. We and
the employee contribute to Social Security at the rate
prescribed by law. We do not match contributions to
the Thrift Savings Plan for employees who participate
in the Dual System.
Federal Employees Retirement System (FERS)
Effective January 1, 1987, officers and career
employees hired since December 31, 1983, except
those covered by the Dual System, are covered by the
Federal Employees Retirement System Act of 1986.
In addition, employees hired before January 1, 1984,
could choose during certain periods in 1987, 1988
and 1998 to participate in FERS. This system consists
of Social Security, a basic annuity plan, and a Thrift
Savings Plan.
We and the employee contribute to Social Security at
the rate prescribed by law. In addition, we are
required to contribute to the Thrift Savings Plan a
minimum of 1% per year of the basic pay of employ-
ees covered by this system. We also match a
voluntary employee contribution up to 3% of the
employee’s basic pay, and 50% of a contribution
between 3 and 5% of basic pay.
Employer and employee base contributions, as a
percentage of employee compensation, are as
follows for each of the three plans for 2003, 2002
and 2001:
2003 2002 2001
CSRS
Employer 17.40* 7.00 7.00
Employee 7.00 7.00 7.00
Dual CSRS
Employer 17.40* 7.00 7.00
Employee 0.80 0.80 0.80
FERS
Employer 10.70 10.70 10.70
Employee 0.80 0.80 0.80
* As of May 2003, Public Law 108-18 changed our
base contribution level for the CSRS. See Note 7.
The number of employees enrolled in each of the
retirement plans at the end of 2003, 2002 and
2001 is as follows:
2003 2002 2001
CSRS 211,913 230,632 248,347
Dual CSRS 10,122 10,828 11,440
FERS 505,728 510,237 514,870
Deferred Retirement Liability – Civil Service
Retirement System
Prior to Public Law 108-18 (see Note 7), when we
increased CSRS employees’ current basic pay we were
liable for the estimated additional deferred retirement
liability. The Office of Personnel Management deter-
mined and billed us for the current portion of the
increase in the estimated deferred liability of the Civil
Service Retirement and Disability Fund (CSRDF) result-
ing from basic pay increases. We expensed as billed
those amounts as they became payable in 30 equal