31.377 Analysis of Government Equity (in thousands of dollars) 1. Purchase of flowers.-Funds are deposited with the Commission by private citizens for the purchase of floral decorations for graves in the World War I and World War II military cemeteries. The donor is advised when the flowers have been placed. 2. Repair of private war memorials. When requested to do so and upon receipt of the necessary funds, the 84,035 Commission will arrange for and oversee the repair of war memorials erected in foreign countries by American citizens, States, municipalities, or associations. Such moneys are accounted for through this fund. -977,207 Object Classification (in thousands of dollars) 924,549 88,335 -995,669 31.377 10,564 8,620 6,850 107,933 104,844 96,306 99.0 1056 nuitants.. -132,585-139,593-142,051 -9,355-12,405 -15,580 This fund is used to pay annuities to retired employees or their survivors, to make refunds to former employees who have left the service, and to pay claims for employees who have died before retirement, or before their annuities are paid in full (5 U.S.C. ch. 14). It is estimated that as of June 30, 1966, there will be 778,571 persons on the annuity roll, compared with 732,243 as of June 30, 1965, and 687,986 as of June 30, 1964. The status of the fund is as follows (in thousands of dollars): Government's contributions for an Employees' salary withholdings..-237,402-287,912 -331,920 Annuity withholdings.. Interest revenue.. 21.98 Unobligated balance available, start of Balance of fund brought forward... 13,247,759 14,385,720 15,612.454 10 22 -16,207 -25,630-32,190 -1,778 -2,300 -2,900 Receipts and other offsets (items 11-17)--397,327-467,840 -524,641 Obligations affecting expenditures... -14,812-13.027 -17,276 6,809 6,559 7,402 -6,559 -7.402 -8,235 Cash income during year: 70 Payment from other funds: Employing agency contributions.... 979,941 Federal contributions.... 62,000 Interest and profits on investments... 419,838 Deductions from employees' salaries.. 979,886 Voluntary contributions, donations, service payments, etc.. 14,592 74.98 Obligated balance, end of year.. 72.98 Obligated balance, start of year.. 90 Expenditures.. Total..... 2,456,257 2,660,190 2,737,438 1 Balances of selected resources are identified in the statement of financial condition. -14,562 -13,870 -18,109 Revenue.. This fund finances the payment of subscription charges to approved carriers of the costs of health benefits protection as provided by the Federal Employees Health Benefits Expense.. Act of 1959 (Public Law 86-382, 5 U.S.C. 3006) together with expenses incurred by the Civil Service Commission in administration of the act. Budget program. The act provides that the employees health benefits fund will be available to pay for administrative expenses incurred by the Commission, within such limitation as may be specified by the Congress. Almost 2 million employees and approximately 160,850 annuitants are participating in this program. By the end of 1966 it is estimated that an additional 94,000 eligible employee and survivor annuitants will participate in the program. For 1966 it is estimated that $364.1 million will be deposited into the fund from amounts withheld from employees and annuitants and $157.6 million will be contributed by the Government. On the basis of these forecasts, $501.7 million will be paid from the fund in 1966 to approved health benefit plans. An amount equal to 3% of the contribution toward each plan is set aside in the fund to provide a contingency reserve for that plan. The contingency reserve can only be used to defray future increased rates, or to reduce contributions, or to provide increased benefits. Effective with the contract period beginning November 1, 1963, an amendment to the regulations provides for additional payments to experience rated carriers from the contingency reserve when the reserves held by the carrier are less than a stipulated amount and the plan's contingency reserve held by the fund exceeds one month's subscription charges. Community rated carriers may also receive additional payments from their plan's contingency reserve held by the fund, when properly justified. In 1964, $861 thousand was paid from the contingency reserve to qualified carriers and for 1965 approximately $6 million will be paid and an estimated $4.5 million will be paid in 1966. In addition, an amount equal to 1% of all contributions is set aside for administrative expenses incurred by the Commission in the administration of the act. Public Law 88-284, enacted March 17, 1964, provides that the Commission from time to time and in such amounts as it considers appropriate may transfer unused funds for administrative expenses to the contingency reserve of the plans under contract. To implement this provision $7.8 million was transferred from the administrative expense reserve to the contingency reserve in May 1964. During 1965 another $2.5 million will be available for transfer, and in 1966 slightly more than $2.5 million will become available. Net income for the year... Assets: Financial Condition (in thousands of dollars) Total assets..-. Treasury balance. U.S. securities (par). Accounts receivable, net. 32,572 31,260 Selected assets: Supplies Fixed assets, net.... Deferred income (Government Liabilities: was withheld from the salaries of covered employees and $402.6 million was contributed by the Government to the fund. It is estimated that in 1966, $113 million will be paid into the fund by employees and $56.5 million by the Government. As of June 30, 1964, a total of $787 million had been paid by the insurer in benefits. It is estimated that over $145 million in benefits will be paid in 1966. Most of the difference between receipts and benefit payments under the policy is placed in reserves. On June 30, 1964, the end of the last completed policy year, there were total reserves of $447 million of which $100 million was held as a special contingency reserve by the insurer at interest, and $347 million was held by the fund with the Treasury of the United States. The contingency reserve is now limited to a level of $100 million, and all amounts above this figure periodically are returned and deposited in the Treasury of the United States to be invested. A summary statement of the operations of the contingency reserve for the three most recent policy years, 1962 through 1964, and the total at the end of the 10th policy year follows: STATEMENT OF ANNUAL ACCOUNTING AND CONTINGENCY [By policy year. Receipts and reimbursements from: Agency contributions... Employees' salary withholdings............. -52,426 -56,000 | -56,500 2. Interest added to contingency reserve. 3. Mortality and other claim charges 4,436 4,410 4,428 32,000 (a) Life insurance. (c) Conversion charges.... Total.. 138,334 139,519 -173,868-185,925-189,220 -45,382 -47,591 -49,701 -10,930 -6,929 -6,929 6,929 6,929 6,929 -49,383 -47,591 -49,701 4. Expense and risk charges incurred: 5. Total addition to contingency reserve. 6. Contingency reserve for the year 8. Contingency reserve held by in surer at end of year... 127,505 138.334 139,519 -176,888-185,925 -189,220 1 Balances of selected resources are identified on the statement of financial condition. This fund finances the payment of group life insurance premiums to private insurance companies under the Federal Employees' Group Life Insurance Act of 1954 (5 U.S.C. 2091-2103) and any expenses incurred by the Civil Service Commission in administration of this act as annually authorized by Congress. Budget program. Through June 30, 1964, with respect to the basic insurance program, a total of $805.2 million 1 The refunds from the contingency reserve were made as follows: $18 million, Dec. 26, 1963; $14 million, July 1, 1964; $15.690, Aug. 6, 1964. Through June 30, 1964, individuals whose beneficial life insurance agreements have been assumed by the fund paid $22.8 million into the fund. It is estimated that in 1966 about $3 million will be paid into the fund by this group. Former members of beneficial associations continue to pay premiums according to the rate schedules in effect at the time their life insurance agreements were assumed by the fund, but the Government makes no current contributions to the fund for these individuals as it does for employees covered under the regular program. A contingency reserve has been established and held by the insurer at interest under the policy covering members of beneficial associations. This reserve, which was estimated to be $5 million on June 30, 1964, will accumulate interest consistent with that provided under the regular program. If the Commission determines that the contingency reserve under the beneficial association program has reached a level sufficient to meet adverse fluctuation in future charges, any amounts above this level will be returned to the fund. Financing.-Premium costs are met by withholding from the salaries of employees 25 cents biweekly for each $1 thousand of life insurance, contributions by the Government, and and direct premium payments from beneficial association members. Operating results.-Earnings are retained to meet the cost of future benefits. U.S. CIVIL SERVICE COMMISSION EMPLOYEES' LIFE INSURANCE FUND Disposition Schedule of Selected Receipts and Premium Payments, August 29, 1954 through June 30, 1964 128,485 1 138,334 139,519 |