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Federal Diary Live
With Stephen Barr
Washington Post Staff Writer
Wednesday, June 25, 2003; Noon ET
The Post's Stephen Barr is the author of The Federal Diary, which runs Sunday through Friday in the Metro section. Steve has been a reporter and editor at The Post since 1979, including stints as Federal Page editor, congressional editor and a staff writer covering the federal bureaucracy. He takes the column live to answer your questions Wednesdays at noon ET.
The transcript follows.
Editor's Note: Washingtonpost.com moderators retain editorial control
over Live Online discussions and choose the most relevant questions for guests and hosts; guests and hosts can decline to answer questions.
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Stephen Barr: Thanks to all of you who are joining us today for this online discussion. My apologies for running late today. Rather than take up your time with an opening statement, we'll just jump right into the questions, comments and observations. Thanks again for participating.
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Arlington, Va.:
One week later and the TSP Web site is still pretty much inoperative. I have tried several times over the last week to access my account at various times of the day and on the weekend. I am still unable to access my account. This performance is completely pathetic and totally unacceptable. Is anyone holding TSP's feet to the fire over their incompetence? washingtonpost.com:
Web Site Glitches Leave the TSP Scrambling, Participants Irritated (Post, June 19)
Stephen Barr: You are not alone. My e-mail inbox is loaded with unhappy TSP customers. Some say they have gotten out of bed at 3 a.m. and 4 a.m. to try and log in for a transaction, only to be thwarted. TSP is working on the problem, but have not been able to identify it, except that the system mainframe gets snarled in an internal communications loop when trying to perform some transactions. Once enough loops are circling inside, the system slows down dramatically.
As to your question, I suspect that the new board chairman, Andrew Saul, a Bush appointee, will hold people accountable. The upgrade started before he arrived and he has been very supportive of the staff and the challenge they have faced. He also is seeking to improve TSP's operation, and so I would expect he will be riding herd on this from behind the scenes.
Interestingly, when I attend board meetings, I never see any sign of employee groups or associations. No union people, no representative of retirees, no OPM representative, etc., attends board meetings. The exception is the Labor Department auditor, who faithfully shows up at each meeting. From my perspective, it is disappointing that unions and employee groups show little interest in TSP operations. Not one has issued a press release on the TSP in my recent memory.
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Derwood, Md.:
Thanks for keeping us up to date on the TSP's Web site problems.
I've been one of the few employees actually able to successfully access their TSP account online. However, I am only able to get in from my home PC, in the very early morning, while using Mozilla as my browser. (When I use the Explorer browser that comes with Windows, the connection times-out.)
Stephen Barr: Good to hear that you've been able to log in. Many employees tell me their computers freeze or they get a time-out message. I'm no tech type, so I don't know if the kind of equipment and software used by a participant makes a difference.
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Foggy Bottom, Washington, D.C.:
TSP question. Maybe I'm totally off base but hasn't the TSP's incompetence cost all in the plan in another way? (Besides of course the costs of the overruns and delays and payments for legal work.)
By delaying the implementation of the daily valuation and the changeover to shares, haven't we essentially had money stolen from us? Say you had $100,000 in the C Fund in 1999 before the bubble. If the system had been implemented then, I would have had 10,000 shares. In 2003, that same 100,000 is now 60,000 and I was given 6,000 shares. Haven't I been cheated out of 4,000 shares? Five or ten years from when the account is worthy 100,000 again, wouldn't I be far ahead if they had done the valuation earlier?
We were also denied the benefits of dollar cost averaging during the down periods of the market, buying more shares when prices were cheaper, weren't we? Instead the value of our account simply declined, rather than giving us more shares. Am I totally off-base here? washingtonpost.com:
New Chairman Initiates Examination of Fast-Growing Thrift Savings Plan (Post, June 23)
Stephen Barr: I'm no financial expert, of course, but I do not think you have been cheated in the system glitch or the conversion to daily valuation.
TSP has essentially moved from a dollar-based system to a share-based system. Account balances were converted according to the funds and sources of contributions. TSP divided your dollar balance in each fund by $10. The value of your account balance did not change. TSP's stock funds are indexed, so even in monthly evaluation you were effectively getting the right value, and picking up cheaper shares of stock, in a down market.
I understand that this shorthand explanation is not very clear, and recommend you go to the TSP website and look page 37 of the "Guide to TSP Investments." It explains the conversion and offers an example to show how the switch was made.
Still, this delay has frustrated several employees, who believe they have lost out on interfund transfers because they could not go online. TSP says the Thriftline is working, and you can accomplish your goals that way.
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Washington, D.C.:
Thanks for keeping a spotlight on the new FSA's. The bottom line is many agencies will not cover the costs until they are required to do so. USDA's pattern has been the same with transportation subsidies, student loan repayments etc. Never get on board until the last moment after the agency has been required to do so. washingtonpost.com:
OPM Urges Agencies to Pay FSA Costs as Enrollment Deadline Nears (Post, June 25)
Stephen Barr: Yes, some agencies do not move quickly to implement job perks and new benefits. In the case of FSAs, OPM got off to a herky-jerky start and probably should have done more outreach to agencies earlier than it did. I've been left with the impression that many agencies got bogged down reprogramming computers for the 1 percent retroactive pay raise and decided they couldn't handle the FSA transition quickly.
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Washington, D.C.:
Hi Steve,
With the FSA accounts, will we be able to take out payments for expenses made back to the beginning of this calendar year?
Stephen Barr: Don't think so. My understanding is that you may submit claims for reimbursement from the accounts starting with your agency's effective date of implementation. A number of agencies will start July 1, so only claims after that date can be submitted. Others start Sept. 1, but you have to be enrolled by Friday, regardless.
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St. Louis, Mo.:
The new FSA will pay for certain medical expenses. Does this mean anything that FEHB plans don't cover? Such as cosmetic surgury.
The IRS doesn't define expenses in detail.
Stephen Barr: As a general rule, FSAs can be used to pay for medical expenses not covered by your health insurance. There are some exceptions, such as your insurance premiums and long-term care insurance premiums. You cannot file a claim for cosmetic surgery, unless your doctor ordered it as part of a medical treatment. There are gray and tricky areas here, but IRS Publication 502 contains a list of what is covered. When in doubt, call the contractor and ask for advice. But almost everyone should be clear winners on vision and dental care--two areas where most federal health plans fall short in the view of employees.
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Sterling, Va.:
A second on the suggestion to try one of the newer versions of Netscape (7.x) -- I've been trying all week, unsuccessfully, to log into my TSP using Internet Explorer, but just got in via Netscape. It's slow, but it works.
Stephen Barr: Thanks for the suggestion.
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Derwood, Md.:
Stephen --
Your two articles on the repayment of student loans were most informative.
I sent links to them to one of our summer interns who wasn't in town when the articles were published in the Post. Hopefully, other feds will do the same for summer interns and co-ops in their workplaces.
I don't understand why many feds are against these loan repayment programs. Since I don't have any student loans, I could not personally benefit from this program either. However, I wonder, if I were to have kids, how else would they be able to afford following in my footsteps and also choosing a career in federal service?
(It is not like federal salaries are high enough that we can pay tuition for our kids!) Aren't other federal employees encouraging their children to consider public service?
washingtonpost.com:
Bill Would Allow Offering Recruits Tax-Free Repayment of Student Loans (Post, March 5)
More Agencies Are Helping Employees With Student Loans (Post, June 10)
Stephen Barr: Thanks for your kind words. Frankly, agencies should do more with the student loan repayment program. But some lack the funds, others are afraid to push for funding on Capitol Hill, and still others don't want to get into the business of choosing which employees get a perk and which ones don't. All the research seems to suggest it is a great recruitment tool, so I am baffled by some of the opposition, too.
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Alexandria, Va.:
Which federal agencies currently have student loan forgiveness programs for employees?
Stephen Barr: OPM has posted a report on its Web site that shows participating agencies. The big two programs are at the State Department and the General Accounting Office.
Other places with loan repayment programs are USDA, Defense, Energy, HHS, GSA, NASA, Interior and Treasury.
Interestingly, OPM does not list making any loan repayments, even though it is a leading advocate for the program.
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Washington, D.C.:
Among Civil Servants, there is a general feeling that the administration is trying to make employment in the government unpleasant and uncomfortable to force people out, and thus lowering the "ceiling" of employees (or rather the total number of people employed by the government). Do you think there is any truth to this perception?
Stephen Barr: Federal employees are getting mixed messages from the Bush team. Bush appointees value employees and want to make the government competitive in hiring; Bush appointees think agencies should run outsourcing competitions that typically result in fewer federal jobs, even when the employees win.
The Clinton-Gore administration sought to reduce federal employment. The Bush administration wants to delayer Washington HQ operations and put more people into front-line services or contract out the work. I think the trend line points toward fewer federal employees, a prospect that troubles many people, given the workload handed the government by Congress.
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Kensington, Md.:
As a retired personnel officer I have followed with some interest the actions in the Pentagon designed to give managers more authority to hire and fire and employees less protection. While I have some sympathy for managers -- the federal employment system does need some changes -- I see no evidence that there is any effort to deal with the basic problem of all large organizations -- the poor quality of, selection, training and preparation for managerial job holders. This question is a bit rhetorical, I know, but if managers are not trained to manage does greater authority make any difference in long term mission accomplishment?
Stephen Barr: Superb point! Studies by the Merit Systems Protection Board show that federal managers need more training. The recent OPM survey found that most federal workers do not hold their "leadership" in high regard. Managers are the meat in the sandwich--pushed from on top by political appointees and from the bottom by unions and employees.
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Colorado Springs, Colo.:
What is the latest news on when the Senate/House are going to resolve their differences regarding the new DOD pay system? Does it seem as if the final bill will be closer to the current system or closer to the system Rumsfeld requested?
Stephen Barr: House and Senate negotiators will start working on a compromise after the July 4th holiday break. The House version is closer to what Rumsfeld wants; the Senate version gives Rumsfeld what he wants in all the big-ticket items (pay banding, performance management, union negotiations) but in a more prescriptive fashion. The Senate bill also phases in the change over three or four years, including revisions in how employees can appeal bad decisions by managers.
In short, I think Rumsfeld is a winner on this. If you love the General Schedule, this is the time to shed your tears.
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McLoud, Okla.:
Why has the Justice Department not got involved in the wholesale breaking of the 1990 pay law? We see other examples of injustices referred to and handled by this department but it seems that this one subject (the pay law) was fair game by the previous administration and nothing has been done since to right this abhorrent wrong. Thanks for your column; it is a beneficial source of information to the federal family.
Stephen Barr: The Justice Department has plenty of work on its plate and typically only gets involved in these kinds of issues when someone forces their hand, as was the case with the TSP contractor dispute. At least one union has looked at the law and thinks it cannot find standing to bring a suit, primarily because the law contains a national security/economic consideration loophole for the president to exercise each year.
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Downtown, Washington, D.C.:
A word to those who are exasperated about applying for federal jobs: a fellow fed employee who works in HR told me recently that an opening that agency had garnered a bit over 100 applications. Sad thing is, about 40 of them had to be tossed out because they didn't have the information requested! To an employer, this is a clear example of a candidate not being able to follow directions and with so many people now finding the government an appealing place to work, employers can be picky. However, 40 incomplete applications out of 100 -- well, someone who may have been very well-qualified for the job but couldn't be bothered to do those bad-but-necessary KSAs or supply all requested information just increased the odds of a mediocre candidate who took the time to follow the directions getting the job. People wonder why they don't hear back from agencies and I'm willing to bet that this is a major reason why.
Stephen Barr: Thanks for sharing this example. Some personnel experts tell me that too many people apply and don't provide all the requested information. My feeling is that agencies ask for too much information up front, and that KSAs cause a lot of worry and people often don't do them right. I'm looking forward to hearing later this year whether OPM has made progress in revamping the hiring system.
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Metro Washington, D.C. area:
Have any government agencies discussed the use of RIF's to achieve their A-76 goals? I know that some have promised not to do that, but to use natural attrition and some buy outs to reach their numbers.
Stephen Barr: Have not heard of any agency resorting to layoffs. A recently passed law makes it easier for agencies to offer early retirement and buyouts, so I would expect we'll see more of that in places where A76 is leading to reorganizations. But, frankly, there are lots of people retiring, and I think agencies, which are short of cash, just want to hang on to their workforces.
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Foggy Bottom, Washington, D.C. Follow Up:
Thanks very much for the reference to the TSP Guide to Investments. I did a quick read through, and I'm still pretty sure that my fear from earlier question is correct.
I may very well be off-base, but it appears that all participants have been seriously compromised by the TSPs dithering both on losing shares and the failure to be able to dollar-cost average during the last three years of the bear market. I'm no financial expert either, though.
Maybe this would be a good subject for a future Federal Diary column. Perhaps you could consult some financial experts?
Thanks, too, for alerting us to the board meetings. The TSP keeps them very quiet. I'm going to be sure to attend the next one.
Stephen Barr: Well, the value of your account goes up and down with the market in the case of the stock index funds. I don't think it makes a difference over the long haul. But seeing account values on a price-per-share basis gives me a better sense of the market's movements. Frankly, this is an overdue effort by TSP to give federal employees what other workers have--a system that lets you move money within a day or so and not have to wait a full month. That is helpful in many ways. But almost all financial advisers recommend that you pick your mix of funds, make your allocations to them, and then let them ride. For most of us, it's simply too difficult to time the market and get in and out at the right moments. Still, people need to be aware of big swings and what that means for them--especially as they near retirement. But the value of your TSP account is a long-haul investment. At the end of the day, how it gets displayed or presented probably makes little difference.
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FSA and IRS:
Stephen,
Pub 502 lists travel expenses connected with medical expenses. Does it mean that FSA would cover it? Also, 502 allows Christian Sceince practitioners, but no, say Ayurveda (in simplified terms -- Indian medicine). What is FSA policy ? I find lack of information about FSA policies unacceptable !
Stephen Barr: When it comes to these kinds of details, I'm of no use to you. IRS tells me that if it is in Pub 502, then it can be charged off against your FSA. Having said that, I think that in the gray zone you need to get the FSA contractor help desk on the phone and ask them for a ruling as to whether a reimbursement will be granted. You're clearly going to have to have some paperwork to file with some claims, so that may also give you a clue.
Yes, the lack of information about FSAs has been a disappointment. OPM announced last year it would launch the program in July, so there appears to have been plenty of time to get detailed educational material out to employees. OPM promises to do a better job this fall, when you will have to re-enroll for the 2004 FSA season.
Well, I've run out of time again today. Thanks to all of you who sent in questions and comments, and thanks to all of you who take the time to read this transcript.
Federal Diary Live will take a Fourth of July break, so we'll see you back here at noon on July 9. Again, thanks for your support! Hope all of you have a grand holiday.
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