Comments on Ten Bills Introduced To Amend the Railroad Retirement Act of 1974
Highlights
GAO considered the impact of 10 bills pending in Congress on the Railroad Retirement Account (RRA). All 10 bills would increase benefit payments. Financing these increased benefits, although not addressed by the bills, would presumably come from the RRA or general revenue appropriations. Even if the bills are not enacted, the long-term financial stabiliy of the RRA is doubtful. Between fiscal years 1970 and 1978, the balance of the RRA dropped 42 percent, from $4.8 billion to $2.8 billion. From 1970 through 1974, the balance dropped an average of $132 million a year. The Railroad Retirement Board's 13th actuarial valuation of the account published in 1976 predicted, based on data through 1974, depletion of the account between 1985 and 1990. From 1975 through 1978, the rate of decline has increased to an average of $356 million a year. If this rate of decline continues, the account will be depleted during 1986. In view of the above described financial condition of the RRA, if the Congress decides to enact legislation increasing railroad retirement benefits, legislation should be provided for necessary revenue sources to fund such increases.