Jessica Klement Legislative Director Virginia Federation Convention Legislative Update Jessica Klement Legislative Director

Agenda 113th Congress Recap 114th Congress Protect America’s Heartbeat FY16 Budget Process NARFE Priorities Protect America’s Heartbeat NARFE in the News NARFE-PAC

113th Congress (2013-2014) Recap Dec. 2013 budget deal for FY14 & FY15 spared current feds and retirees Prevented sequestration-related furloughs I don’t want to spend too much time on looking back, but it’s important to know where we’ve been when looking at where we’ll go. Lets start with the good news! At the end of 2013, Congress passed a budget deal partly offsetting sequestration and funding agencies for FY14 and FY15. This meant that the annual budget battles of the past years would not be part of 2014. NARFE’s work on the budget deal also garnered us one of the top 10 lobbying victories of 2013

113th Congress (2013-2014) Recap More good news: FEHBP “self plus one” option available in 2016 Back pay provided to feds furloughed during the government shutdown Phased retirement now available Extension of reemployed annuitants waiver passed Written and oral testimony before Congress The budget deal also included self plus one. Extension of reemployed annuitants waiver because of NARFE reminding Congress that it was about to expire and pushing the issue.

113th Congress (2013-2014) Recap Success should be judged by what happens, as well as by what doesn’t happen Senate postal bill stalled Chained CPI hasn’t moved forward Federal retirees have not had to pay for deficit reduction talks/sequestration offsets I’ll discuss later why the stalling of the postal bill was a good thing.

113th Congress (2013-2014) Recap And now, the bad news… 3-year federal employee pay freeze Two increases in retirement contributions for new feds Very small federal pay raise in 2014 and 2015 Now a look at the not-so good. Federal pay raises were less than the COLA and the ECI

113th Congress (2013-2014) Recap And the REALLY bad news… 16-day government shutdown in October 2013 1-10 furlough days for 750,000 feds as a result of sequestration Loss of $1 billion in take home pay And now, the ugly 274 local CBS affiliates. 

$120 Billion! 113th Congress (2013-2014) Recap Contributions from the federal community to date. $120 Billion! And perhaps the ugliest figure of all Note why others use different figures

114th Congress (2015-2016) Fiscal Environment on Capitol Hill Budget fights began in February with release of President’s FY16 budget House and Senate budgets passed in March 7 years of sequestration remaining Budget fights loom for FY16 and beyond The 114th Congress convened in January, with the GOP holding control of both chambers of Congress. There are two years left in President Obama’s term. Could be a contentious budget process, as House and Senate look to offset sequestration. The key area of focus for NARFE will be the fact that Congress will not only be looking to offset sequestration, but also working towards a “balanced budget” ahead of the 2016 elections.

FY16 Budget Process FY16 House Budget Resolution included: Increasing FEHBP premiums by tying the government’s contribution to inflation 6% Increase in retirement contributions for current feds A decrease in the rate of return on the TSP’s G-Fund Increasing federal retirees’ share of FEHBP premiums by basing the government contribution on years of service Encouraging the total elimination of FERS Eliminating the FERS Annuity Supplement Increasing postal employees’ share of their FEHBP premiums A 10% reduction of the federal workforce through attrition 6% is average; would make all feds equal G Fund change has implications for L Fund as well. If applied to March 2015, the policy would have reduced the rate of return from 1.875% per year to less than 0.02% per year. Interest earned on money in the G Fund would be lower than inflation, making the effective return negative, or less than worthless. The fund’s current annualized interest rate is 1.88%; the budget would result in an interest-rate drop to an annualized 0.01%. About 4.3 million people are invested in the G Fund. Senate budget included: NO details. None. But in press interviews, staff said it assumes the following: Increasing employees’ FEHBP premiums by tying the government’s employer contribution to inflation, 6% Increase in retirement contributions for current feds A 10% reduction of the federal workforce through attrition

FY16 Budget Process Now what happens? Joint Budget Resolution and possible Reconciliation MANDATORY spending measures only “Reform” Civil Service Retirement RETIREE FEHBP Coverage and Premiums Now that the House and Senate have passed their budgets, the committees will go to conference. What we’ll be watching for is if the conference report, not signed by the President, contains reconciliation instructions. If the budget process gets to the point of reconciliation, only 51 votes in the Senate is necessary. Reconciliation was how the ACA passed. The question will become – are congressional Republicans serious about deficit reduction? Any reconciliation bill that repeals Obamacare will be vetoed.

114th Congress (2015-2016) What else is on the table? Chained CPI Pay freezes or reduced pay raises High-3 to High-5 Changing retirement multiplier Government efficiency as a smokescreen for cuts Possible civil service reform In addition to all the provisions in the House budget, there are other cuts that could arise. Once something is “out there” it becomes very easy to use it to pay for other legislation. All these things are back on the table during the budget fights and other fights that may arise. Highway funding for instance.

114th Congress (2015-2016) NARFE’s Legislative Priorities Fighting attacks to federal pay and benefits, including FEHBP Crafting a USPS reform bill that provides actual reform Preventing Chained CPI from becoming reality So, now that you know what we’re up against, where will we be focusing our time? NARFE priorities will be very dependent on congressional action. Never know what to expect and have to be ready to switch focus at a moment’s notice. But here’s what we do know: Unfortunately, defense remains the name of the game. These are our top tier priorities for the Congress. Maintaining current benefits should be considered a victory.

114th Congress (2015-2016) NARFE’s Legislative Priorities – Postal Reform 113th Congress postal reform bill included: Cuts to injured workers’ compensation for all federal employees Possible elimination of FERS benefit for new postal employees Mandatory Medicare Part B enrollment for postal retirees and spouses Keep it brief Goal is to craft a postal bill that provides actual reform, not just benefit cuts. Here is why we opposed last year’s bill. Slippery slope for the rest of the federal workforce.

Protect America’s Heartbeat All Politics is Local Grassroots Advocacy Shows: Personal Commitment to an Issue Local Importance of an Issue Momentum for an Issue Constituents are Voters and Voters Elect Members Silence = Acceptance www.narfe.org/heartbeat So, now that you know our priorities, what can you do? NARFE’s Protect America’s Heartbeat program is our grassroots program designed to increase member engagement on legislative issues and draw positive media attention to the federal community. Because this is an ongoing campaign, it is important to remain aware of what is going on. Because politics is all about relationships and all politics is local, our grassroots efforts become more and more important to NARFE’s overall advocacy. What is Grassroots? A bottom up, not a top down, approach to advocacy A locally driven, grassroots campaign shows momentum for an issue Grassroots engagement shows personal commitment and demonstrates the importance of the issue – the more important it is to you, the more important it will be to your MOC. Everybody can and should do Grassroots advocacy. Constituents are voter and voters elect members. If they don’t know how their constituents feel about an issue, they will assume everybody agrees with them. Silence is acceptance.

What You Can Do Write Your Members of Congress Attend Town Halls Make Phone Calls Utilize Social Media Read the PAH Daily Clips Join Monthly PAH Calls Represent NARFE at Community Events Check NARFE website Utilize the Toolkit

Personalize! Personalize! Personalize! Share Your Story – you are in a unique position to share your experiences as a federal worker but also these policies will personally impact you; how much money does this mean out of your pocket. Chained CPI is a great example of this. It isn’t just that the policy impacts you at an individual level but also that it impacts your community and local economy. Better working relationship with the Legislative Dept and NARFE leaders on the ground. Members’ offices have said having a local contact is the best way to get views across. National Journal survey – “One hundred form letters have less direct value than a single thoughtful letter generated by a constituent of the Member’s district.” -- House Correspondence Staffer Building relationships Share Your Story Local and/or Personal Impact Why You Support or Oppose the Legislation

Protect America’s Heartbeat What can you do NOW? Call your Senators and Representative and tell them to vote against any budget agreement that includes cuts to federal employees and retirees. 1-866-220-0044

NARFE in the News 699 total press clips (2013 & 2014) including 512 articles in top tier national media 177 letters to the editor From 2010 to 2013, NARFE averaged about 100 media hits a year. 2013 saw 466 media hits, and 233 in 2014. Prior to 2010 was probably less than the 100 mark. We’re also building relationships with top tier reporters, which is going a long way in getting NARFE media coverage. NARFE is out there as a trusted, unbiased source for reporters. We are the go to on federal issues.

Importance of NARFE-PAC NARFE-PAC helps defend YOUR earned pay and benefits by: Electing members of Congress who support the federal community Building meaningful relationships with members that can influence votes Helping our supporters rise to leadership positions, which can influence the congressional agenda NARFE-PAC is the political arm of NARFE. It is a completely separate, segregated fund of the Association that is funded solely through your voluntary contributions to NARFE-PAC. That means no membership dues or general NARFE fundraiser funds goes towards NARFE-PAC. We often refer to NARFE-PAC as the “Federal Employee and Retiree Defense Fund,” because it’s a critical tool in our advocacy toolbox to defeat attacks against the federal community. Along with our lobbying in DC and grassroots advocacy by all of you, NARFE-PAC works to defend your earned pay and benefits. It does this in multiple ways, including by electing members of Congress who support the federal community, building meaningful relationships with members that can influence votes, and helping our strongest supporters rise to leadership positions, where they can influence the legislative agenda.

NARFE-PAC by the Numbers As you can see, NARFE-PAC contributions have decreased over time. Critically, in the last two-year cycles (2011-2012 and 2013-2014), NARFE-PAC has brought in less than $1 million. We hope to reverse that in this new 2015-2016 election cycle. Even though NARFE’s membership is smaller now than it was at the start of this chart, the next two graphs will show that NARFE-PAC can raise more than it is currently.

NARFE-PAC by the Numbers 2013-2014 PAC Receipts (contributions from members) This graph shows how much we raised in the 2013-2014 cycle compared to other federal employee/retiree organizations. As you can see, NARFE is in red, and is towards the bottom half of this list. Only three groups in this chart have more members than NARFE, the International Association of Fire Fighters (IAFF), National Association of Letter Carriers (NALC) and the American Federation of Government Employees (AFGE). However, there are multiple groups that raised considerably more money from its members. NARFE can and has to do better.

NARFE-PAC by the Numbers 2013-2014 PAC Disbursements (money to candidates) This next graph shows how much these groups gave to candidates. Obviously the groups that raised more than us, gave more to candidates. If we want to grow NARFE’s influence, we have to grow NARFE-PAC. Since we are bigger than most other federal employee/retiree organizations, it is possible for NARFE to compete with these bigger PACs and play a bigger role in the political process.

NARFE-PAC Giving Levels Sustainer: monthly credit card contribution of $10+ Gold: $250+ Silver: $100-249 Bronze: $50-99 Basic: $25-49 Here are the new giving levels for the 2015-2016 cycle. First, we have the Sustainer program. The Sustainer Program allows members to sign up and contribute a set amount via their credit card every month. Individuals who sign up for this program and give at least $10/month via credit card will receive a Sustainer pin and NARFE duffle bag. Sustainers are critical to NARFE-PAC because they allow us to get a better sense of how much money we can expect to bring in each month and helps us plan how much we can give to candidates. Gold is our highest single contribution level. Those giving $250 or more during the cycle will receive the Gold pin and NARFE duffle bag. Next, is the Silver level. For contributions from $100 to $249, you will receive a Silver pin. The Bronze level is from $50 to 99, and finally, the Basic level is from $25 to $49. You may notice we have increased the giving levels from previous cycles. That’s because since the giving levels were originally created, the cost of the mailings and incentives (pins and gifts) has increased, which has decreased the net amount raised. NARFE-PAC contributions from members has also steadily declined, as we saw earlier. After much deliberation, we increased the giving levels and created a new level for the 2015-2016 cycle to strengthen NARFE-PAC and encourage larger donations. These increases also bring us more in line with the giving levels of our coalition partners. As we saw earlier, while NARFE is one of the largest federal community organizations in terms of membership, we lag far behind others in terms of PAC dollars raised.

Goals for 2015-2016 Cycle Raise $1,000,000 Give $525,000 to candidates Increase Sustainers by 25% Attend 30 in-state fundraisers Have PAC tables at every federation convention And finally, in order to grow NARFE-PAC, we have set the following goals for the 2015-2016 cycle. First, we want to raise $1 million. We believe this is a reachable goal, although it will take everyone’s help. As we just saw, two cycles ago, we were just under $1 million. So by raising more than we did the past two cycles, we hope to begin a new trend- one where PAC contributions steadily increase. Our second goal is to give $525,000 to candidates, in addition to the $120,000 we expect to give to the four party committees. This will allow us to contribute to our strongest supporters, but also new supporters and new candidates running for office. Next, we’d like to increase PAC Sustainers by 25%. On the organizing front, we’d like to have local NARFE members attend 30 in-state fundraisers. This will aid us in building relationships at the local level. We’d also like every Federation Convention to have a PAC table, a goal which hopefully your federation is helping us achieve today. By achieving these goals, we can grow NARFE’s political influence. By combining this with our lobbying and grassroots activity, we hope to continue NARFE’s long history of defending your earned pay and benefits.

QUESTIONS?