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Latest retiree, FECA COLA projections released

2017 Retiree COLAs Projection: 0.3% as of September 2016

The 2017 cost-of-living adjustments (COLAs) for Civil Service Retirement System (CSRS) and Federal Employees Retirement System (FERS) benefits will be based on the increase in the average Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) between the third quarter of 2014 (234.242) and the third quarter of 2016 (TBA).

Based on the August 2016 CPI-W (1982-84=100) of 234.909, the 2017 CSRS and FERS COLAs are currently projected to be 0.3 percent. CSRS annuities receive full COLAs; COLAs for FERS annuities are payable for retirees 62 and older and may be reduced by up to one percentage point from the increase in the CPI.

Note about the 2014 base period: Since no COLA adjustment took place when the final COLA calculation was made last year (0 percent COLA, no COLA), the base quarter remains the third quarter of 2014.

2017 FECA COLA Projection: 1.8%

Based on the release of the August 2016 CPI-W (1982-84=100), the 2017 FECA COLA is currently projected to be 1.8 percent.

The August 2016 CPI-W (234.909) was 1.8 percent above the December 2015 base index (230.791).

FECA COLAs are applicable only in cases where death or disability occurred more than one year prior to the adjustment’s effective date.

7th Contract COLA was $0 (last COLA of the 2011-2016 National Agreement)

The January 2016 CPI-W (1967=100) was 688.259, an increase of 16.360 points over the contract’s July 2012 base index of 671.899. Each full 0.4 point increase above the base index equals a 1 cent per hour increase. As a result, there was no 7th COLA.

The 7th COLA calculation was made by: (1) calculating the cents per hour increase from the base index to the current index and (2) subtracting the contract COLAs that have already been announced from the amount calculated in step 1.

Since the current cents per hour increase from the base index (40 cents per hour) is lower than the already announced contract COLAs (66 cents per hour total), the 7th COLA projection is 0 cents per hour (no COLA).

The six COLAs previously announced under the 2011-2016 National Agreement, totaling 66 cents per hour, are as follows: 1st COLA, 7 cents per hour ($146 annually), 2nd COLA, 26 cents per hour ($541 annually), 3rd COLA, 0 cents per hour ($0 annually), 4th COLA, 33 cents per hour ($686 annually), 5th COLA, 0 cents per hour ($0 annually), and 6th COLA, 0 cents per hour ($0 annually).