DO HEARING BEFORE THE SUBCOMMITTEE ON RAILROAD RETIREMENT OF THE COMMITTEE ON LABOR AND PUBLIC WELFARE EIGHTY-NINTH CONGRESS FIRST SESSION ON S. 3157 TO AMEND THE RAILROAD RETIREMENT ACT OF 1937; ELIM- Hon. Peter H. Dominick, a U.S. Senator from the State of Colorado... Donald S. Beattie, executive secretary-treasurer, Railway Labor Execu- Howard W. Habermeyer, chairman, United States of America Railroad Retirement Board, Čhicago, Ill....... Gerald D. Finney, general attorney, Association of American_Railroads. George W. Finnigan, president, National Railroad Pension Forum, Inc., and Robert B. Byrnes, Washington representative, National Railroad Beattie, Donald S., executive secretary-treasurer, Railway Labor Execu- Dominick, Hon. Peter H., a U.S. Senator from the State of Colorado - - Finney, Gerald D., general attorney, Association of American Railroads_- Finnigan, George W., president, National Railroad Pension Forum, Inc., and Robert B. Byrnes, Washington representative, National Railroad Habermeyer, Howard W., chairman, United States of America Railroad Retirement Board, Chicago, Ill.... Hartke, Hon. Vance, a U.S. Senator from the State of Indiana__ Montoya, Hon. Joseph M., a U.S. Senator from the State of New Mexico__ Morse, Hon. Wayne, a U.S. Senator from the State of Oregon__. Poff, Hon. Richard, a Representative in Congress from the State of Vir- Randolph, Hon. Jennings, a U.S. Senator from the State of West Virginia__ Thurmond, Hon. Strom, a U.S. Senator from the State of South Carolina__ ADDITIONAL INFORMATION Amendments to H.R. 3157, offered by Senator Pell Average monthly gross railroad earnings__ Letter from Gerald D. Finney, Association of American Railroads, to III AMENDING THE RAILROAD RETIREMENT ACT OF 1937 TUESDAY, JUNE 29, 1965 U.S. SENATE SUBCOMMITTEE ON RAILROAD RETIREMENT OF THE COMMITTEE ON LABOR AND PUBLIC WELFARE, Washington, D.C. The subcommittee met at 10 a.m., pursuant to call, in room 4200, Senate Office Building, Senator Claiborne Pell (chairman of the subcommittee) presiding. Present: Senators Pell (presiding) and Fannin. Committee staff members present: Stewart E. McClure, chief clerk; E. George Pazianos, counsel to the Subcommittee on Railroad Retirement; and Frank Cummings, minority labor counsel. Senator PELL. The Subcommittee on Railroad Retirement opens its hearings on H.R. 3157. The provisions of this bill before us today are substantially the same as the provisions of the bill H.R. 12362, 88th Congress, 2d session. That bill was not acted upon by this subcommittee last year because of the limitation of time during the last days of the session. That bill was opposed by the Railroad Retirement Board and the Association of American Railroads because the railroad retirement system had at that time an actuarial deficit of close to $19.5 million a year, and the enactment of that bill would have increased that deficit by $14 million a year to a total of about $33.5 million a year: Today, however, the picture is considerably worse. The social security amendments bill, H.R. 6675, was passed by the House and approved by the Senate Finance Committee with certain amendments. As so amended, the social security maximum tax base would be increased, beginning January 1966 from the present $4,800 a year to $6,600. The maximum taxable monthly compensation under the Railroad Retirement Tax Act is now $450 or $5,400 a year. If the $6,600 a year should be adopted for the social security system, and this bill is enacted, the acturial deficit of the railroad retirement system would be increased, according to the actuary of the Railroad Retirement Board, to about $61.1 million a year. The additional increase in the deficit would result from increases in maximum annuities to spouses and in annuities computed under the overall social security minimum provision of the Railroad Retirement Act. It follows that any increase in the railroad retirement monthly taxable base would reduce this deficit. Without such increase the railroad retirement system would be confronted with serious financial problems. 1 |