Federal Manager's Daily Report

CBO has estimated that DoD will offer buyouts to about 5,900 employees on average in future years, in assessing the impact of language in the House version of the defense budget (HR-2810) extending by three years the authority DoD has through fiscal 2018 to pay up to $40,000 rather than the standard $25,000.

CBO added, though, that its estimate further assumes that three-fourths of those employees will not be eligible for the higher maximum; a buyout is worth the smaller of a dollar figure or the employee’s severance pay entitlement.


There has been a general assumption in federal personnel circles that agencies will step up their use of buyouts in response to the administration’s budget plans and its agency reorganization orders–although there is less agreement regarding how widely that authority will be used. DoD commonly is mentioned as one of those least likely to pay buyouts since it stands to gain funding under the administration’s budget plans. However, agencies do use buyouts, commonly along with early retirement offers, in reorganization and DoD is subject to that initiative along with other agencies.

The CBO estimate applies only to DoD since it was examining a House bill providing for only a three-year extension of the higher rate for DoD beyond next September. A separate proposal is pending before Congress to raise the maximum to $40,000 government-wide; should that be added to the DoD authorization or another bill, CBO would likely produce a fuller estimate.