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Rule

Retirement Age

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Start Preamble

AGENCY:

Railroad Retirement Board.

ACTION:

Final rule.

SUMMARY:

The Board amends its regulations to update the references regarding age required for eligibility for an annuity and for the application of work deductions.

Full retirement age is no longer age 65, but instead ranges from age 65 for those born before 1938 to age 67 for those born in 1960 or later. The Board amends its regulations to replace obsolete references to “age 65” with a reference to “retirement age'.

DATES:

This rule is effective July 1, 2003.

Start Further Info

FOR FURTHER INFORMATION CONTACT:

For information specifically about this final rule, contact Michael C. Litt, General Attorney, Office of General Counsel, Railroad Retirement Board, 844 North Rush Street, Chicago, Illinois 60611-2092, (312) 751-4929, TDD (312) 751-4701.

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SUPPLEMENTARY INFORMATION:

Section 106 of the Railroad Retirement Solvency Act of 1983, Public Law 98-76, amended the Railroad Retirement Act to replace references to “age 65” with “retirement age (as defined in section 216(l) of the Social Security Act).” Section 216(l) of the Social Security Act defines “retirement age” as follows: with respect to an individual who attains “early retirement age” before January 1, 2000, 65 years of age. “Early retirement age” is defined in the case of old-age, wife's or husband's insurance benefits, as age 62. With respect to individuals who attain early retirement age after December 31, 1999, the retirement age gradually increases.

The amended regulations replace references to “age 65” with the phrase “retirement age” in order to conform the regulations to the above-described amendment.

The Board published the proposed rule on June 17, 2002 (67 FR 41205), and invited comments by August 16, 2002. No comments were received. However, in preparing the rule for publication as a final rule, it was discovered that § 225.33(a)(1) of the Board's regulations also contains a reference to “age 65” that should be replaced by a reference to “full retirement age.” Accordingly, the proposed rule has been redrafted as a final rule to include amendment of that section.

Collection of Information Requirements

The amendments to these parts do not impose information collection and record keeping requirements. Consequently, the final rule need not be reviewed by the Office of Management and Budget under the authority of the Paperwork Reduction Act of 1995. Start Printed Page 39010

Regulatory Impact Statement

Prior to publication of this final rule, the Board submitted the rule to the Office of Management and Budget for review pursuant to Executive Order 12866. Executive Order 12866 directs agencies to assess all costs and benefits of available regulatory alternatives and when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). A regulatory impact analysis (RIA) must be prepared for rules that constitute significant regulatory action, including rules that have an economic effect of $100 million or more annually. This final rule is not a major rule in terms of the aggregate costs involved. Specifically, we have determined that this final rule is not a major rule with economically significant effects because it would not result in increases in total expenditures of $100 million or more per year.

The amendments made by this final rule are not significant. The amendments to parts 218, 220, and 225 update references regarding the “age” required for eligibility for an annuity and for the application of work deductions. Full retirement age is no longer age 65, but instead ranges from age 65 for those born before 1938 to age 67 for those born in 1960 or later. The Board amends its regulations to replace obsolete references to “age 65” with a reference to “retirement age'.

Both the Regulatory Flexibility Act and the Unfunded Mandates Act of 1995 define “agency” by referencing the definition of “agency” contained in 5 U.S.C. 551(l). Section 551(l)(E) excludes from the term “agency” an agency that is composed of representatives of the parties or of representatives of organizations of the parties to the disputes determined by them. The Railroad Retirement Board falls within this exclusion (45 U.S.C. 231f(a)) and is therefore exempt from the Regulatory Flexibility Act and the Unfunded Mandates Act.

Executive Order 13132 establishes certain requirements that an agency must meet when it promulgates a rule that imposes substantial direct compliance costs on State and local governments, preempts State law, or otherwise has Federalism implications. We have reviewed this final rule under the threshold criteria of Executive Order 13132 and have determined that it would not have a substantial direct effect on the rights, roles, and responsibilities of States or local governments.

In accordance with the provisions of Executive Order 12866, this regulation has been reviewed by the Office of Management and Budget.

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List of Subjects

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For the reasons stated in the preamble, the Railroad Retirement Board amends parts 218, 220, and 225, of chapter II of title 20 of the Code of Federal Regulations as follows:

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PART 218—ANNUITY BEGINNING AND ENDING DATES

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1. The authority citation for part 218 continues to read as follows:

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Authority: 45 U.S.C. 231f(b)(5).

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2. In

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a. § 218.9(a)(2);

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b. § 218.12(b)(2)(ii);

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c. § 218.13(b)(1)(ii), and § 218.13(b)(2)(ii);

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d. § 218.16(b)(2)(ii);

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e. § 218.17(b)(2)(ii);

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f. § 218.36(a)(3), and § 218.36(b);

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g. § 218.40(c)(4);

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h. § 218.43(b)(3), and § 218.43(c)(6);

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i. § 218.44(b)(3), and § 218.44(c)(6).

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PART 220—DETERMINING DISABILITY

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3. The authority citation for part 220 continues to read as follows:

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Authority: 45 U.S.C. 231a; 45 U.S.C. 231f.

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[Amended]
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4. Amend § 220.161 by removing the words “becomes 65 years old and the disability annuity is converted to an age annuity.”, and add in their place the words “attains retirement age and the disability annuity is converted to a full age annuity.”

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[Amended]
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5. Amend § 220.176 by removing the words “age 65,” and adding in their place the words “full retirement age''.

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PART 225—PRIMARY INSURANCE AMOUNT DETERMINATIONS

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6. The authority citation for part 225 continues to read as follows:

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Authority: 45 U.S.C. 231f(b)(5).

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[Amended]
Start Amendment Part

7. Amend § 225.2 by removing the wording “216(I)” from the definition of “Base Years”, and adding in its place “216(l)''.

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[Amended]
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8. Amend § 225.30(a) by removing the words “age 65”, and adding in their place the words “full retirement age''.

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[Amended]
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9. Amend § 225.33(a)(1) by removing the words “Age 65 years old”, and adding in their place the words “Full retirement age''.

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10. Amend § 225.34 by:

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a. Removing the words “age 65” from paragraph (a)(1), and adding in their place the words “full retirement age';

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b. Revising paragraph (b)(3); and

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c. Adding a new paragraph (b)(4).

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The revision and addition read as follows:

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How the amount of the DRC is figured.
* * * * *

(b) * * *

(3) Employee attains age 65 in 1990 and before 2003.

(i) The rate of the DRC (one-fourth of one percent) is increased by one-twenty-fourth of one percent in each even year through 2002. Therefore, depending on when the employee attains age 65, the DRC percent will be as follows:

Year employee attains age 65Delayed retirement (%) credit
19907/24 of 1%.
1991Do.
19921/3 of 1%.
1993Do.
19943/8 of 1%.
1995Do.
19965/12 of 1%.
1997Do.
199811/24 of 1%.
1999Do.
20001/2 of 1%.
2001Do.
200213/24 of 1%.

(ii) The delayed retirement credit equals the appropriate percent of the PIA times the number of months in which the employee is age 65 or older and for which credit is due.

(4) Employee attains full retirement age in 2003 or later. The rate of the DRC (one-fourth of one percent) is increased Start Printed Page 39011by one-twenty-fourth of one percent in each even year through 2008. Therefore, depending on when the employee attains full retirement age, the DRC percent will be as follows:

Year employee attains full retirement ageDelayed retirement credit (%)
200313/24 of 1%.
20047/12 of 1%.
2005Do.
20065/8 of 1%.
2007Do.
2008 and later2/3 of 1%.
* * * * *
Start Signature

Dated: June 25, 2003.

By Authority of the Board.

Beatrice Ezerski,

Secretary to the Board.

End Signature End Supplemental Information

[FR Doc. 03-16532 Filed 6-30-03; 8:45 am]

BILLING CODE 7905-01-P