Tom Trabucco is Director of External Affairs for the Federal Retirement Thrift Investments Board and fills us in on this month’s numbers so far, as well as what happened at the monthly meeting of the Board.
“I know that it seemed, after the past couple of weeks, like things have really headed south, and I think Tracy Ray felt the same way this morning. She wanted to lighten everybody up a little bit and point out that things are not as bad as they may look through the very short term trend. Although we had a rough week last week, 2 of the 5 funds are still up, and 3 are not as bad.”
The meeting was also a bit bittersweet, Trabucco said, because the Board bade farewell to two members: Gordon Whiting of New York and Tom Fink of Alaska.
“Gordon has been on the Board for seven and a half years. Tom has been on the Board for 14 years. They have both done a great job and we’re very grateful for their service. The president announced and sent forward nominations to replace them — Dana Bilyeu, who is currently associated with the Nevada state employees retirement system, and Michael Kennedy, who is with the Georgia state retirement system.”
The two new nominees have to be confirmed by the Senate.
This law, if passed, would basically let people leaving government service turn their unused annual leave into an investment in the TSP. President Obama first introduced the idea last Labor Day when he talked about allowing people in the private sector to do the same thing.
“[They were able] to allow plans in the private sector to do that with just an announcement from the IRS. For us, it takes a piece of legislation to authorize that, and that’s what HR 4865 [does].”
The bill has been introduced in the House and has cleared committee. Now, however, the CBO has released its cost estimate for the bill.
“It’s a bit of bad news, because [the estimate] found that this would, indeed, be a popular benefit, and thus would have a fairly significant cost. CBO estimates it at $317 million over 10 years.”
The cost, Trabucco said, basically comes from the fact that the Treasury would lose that tax revenue that would otherwise be collected on those TSP funds. Now, he added, the Board needs to find a pay-for, which could be applied against those costs and allow the bill to move forward.
We’re going to talk more about this next week, when Trabucco comes back for his weekly chat. Stay tuned!