Fedweek

The provision would represent the first move toward increasing buyout payments in several years and enactment into law likely would provide grounds for arguments that the same should be done for all agencies.

The Senate could vote soon on a NASA reauthorization bill (S-2800) that would allow that agency to pay its employees buyouts—also called voluntary separation incentive payments—of up to $40,000, compared with the longstanding $25,000 maximum in effect at all agencies except DoD.

While the measure cleared the Senate committee level late last year, it could now be headed for a floor vote now that the Congressional Budget Office has completed an assessment of that and other provisions. The CBO said based on NASA’s use of buyouts in recent years, only about 75 employees per year would be affected.

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Even with such a limited impact, the provision would represent the first move toward increasing buyout payments in several years and enactment into law likely would provide grounds for arguments that the same should be done for all agencies.

The $25,000 amount was first set during the Clinton administration. The Obama administration several times sought a boost to $40,000 government-wide on grounds that the value had eroded over time and was no longer a sufficient incentive for employees to leave. Congress in 2016 agreed to the higher amount but only for DoD.

The Trump administration, making the same argument its predecessor had made, requested an increase to $40,000 government-wide in its early budget proposals, although its most recent request did not repeat it.

The proposed boost government-wide came closest to enactment in 2018 when the Senate approved it as part of a defense spending bill that further would have indexed the amount to inflation. However, that provision was dropped in a conference with the House on grounds that under budget rules, the additional cost would have to be offset with reductions in benefits to military retirees.

Buyout offers most commonly are used when agencies are reorganizing or downsizing an operation and those who accept them may not return to the federal government within five years unless they repay the full pre-tax amount, with limited exceptions. Often they accompanied by offers of early retirement. Neither has been widely used in recent years.

Primer: Early out, buyout, reduction in force (RIF)

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