Non-Appropriated Fund Instrumentality (NAFI) Program

The Non-Appropriated Fund Instrumentality (NAFI) Program is a computer-based system that provides benefits specialists a tool to assist eligible employees with retirement coverage elections under Public law 104-106.

Public Law 104-106 is the National Defense Authorization Act for Fiscal Year 1996. Section 1043 of this legislation created a 1-year opportunity under which employees under the Federal Employees Retirement System (FERS) who meet criteria set out in the law could elect to receive FERS credit for prior nonappropriated fund instrumentality (NAFI) service, or to retroactively resume retirement coverage previously held as a NAFI employee. Likewise, certain NAFI employees at the Departments of Defense or Coast Guard with prior service under FERS or the Civil Service Retirement System (CSRS) could elect to return to retirement coverage under FERS or CSRS or to credit their FERS service in their current NAFI retirement plan.

The general purpose of this portion of section 1043 is to allow certain FERS and NAFI employees who had moved between the systems before the effective date of the regulations (August 10, 1996) the opportunity to combine all their service--both NAFI and regular civil service--in a single retirement benefit. The windows-based program described above has been jointly sponsered by the Department of Defense and the U.S. Office of Personnel Management to help eligible employees make these elections.

The program takes information about past service and the employees expectations of future employment to provide projections of future benefits under the options that are available to the employee.

The deadline for making these elections is August 11, 1997, unless an employee meets the criteria described later in this announcement for a waiver of the deadline.

Note: The legislation also provides that certain employees who move between NAFI employment and FERS/CSRS anywhere in the Federal government on and after August 10, 1996 may elect to retain their current retirement coverage in future employment. This computer model is not designed to assist employees with these elections.

WHO IS ELIGIBLE TO MAKE AN ELECTION TO RESUME PRIOR RETIREMENT COVERAGE OR CREDIT PRIOR SERVICE TO CURRENT RETIREMENT PLAN?

Employees must satisfy the following eligibility criteria to make an election under section 1043 of Public Law 104-106:

HINTS FOR THE NAFI PROGRAM USER

Users' Guide. A user's guide is available in two ways. A stand-alone document can be printed out before you enter the transfer model. Within the model information for the User's Guide is available on Help! screens.

CONDITIONS FOR WAIVER OF AUGUST 11, 1997 DEADLINE

Public Law 104-106 requires that all employees eligible to make an election receive timely notice of the election opportunity. Therefore, any employee who did not receive timely notice of the election opportunity may make an election after the August 11, 1997, deadline. To avoid deadline waivers, we urge agencies to notify employees as soon as possible. The law also requires that employees receive any information or assistance needed to make the election. Section 847.304 of title 5, Code of Federal Regulations, grants agencies the authority to waive the election deadline if an employee did not receive timely notice or counselling concerning the election opportunity.

REFERENCE MATERIAL

EMPLOYEE RECORDS

Please contact the following offices for information about an employee's prior service or contributions to a retirement plan that are available for transfer. Note that the current employing agency has an employee's records of current service and retirement contributions.

FOR FURTHER ASSISTANCE

For information about the Department of Defense regulations implementing this legislation, and assistance with the NAF retirement plan rules, please contact the Nonappropriated Fund Retirement Policy and Operations offices.

For assistance about the regulations and guidance governing employees in appropriated fund positions and general assistance on using this program, call (202) 606-0777, extension 954, or email Agency Services.

For assistance regarding the Federal Retirement Thrift Investment Board's policy, call (202) 942-1460.

For technical information about the programming and underlying assumptions in this program, contact the developer of this model at (703) 642-5225 or send an email to Economic Systems. Inc.