disability and the approval of such certificate by the Secretary of the Treasury, may receive, out of the fund created by section eight of this act, an annual disability allowance, payable quarterly, equal to one and one-half per centum of his total compensation during service prior to such retirement. Allowances under this section shall be discontinued on arrival of the employee at the age of retirement unless sooner terminated by the Secretary of the Treasury.

If upon the retirement of an employee on a disability allowance the money then to his credit under section two of this act, together with interest thereon at three and one-half per centum per annum, compounded annually, will not be sufficient to purchase an annuity, payable quarterly throughout life, for such employee on arrival at the age of retirement equal to his annual disability allowance, the Secretary of the Treasury shall deduct and withhold from his quarterly disability allowance an amount, computed to the nearest tenth of a dollar, that together with the money then to his credit, with interest, will be sufficient to purchase such annuity. Amounts deducted and withheld from disability allowances shall be treated as deductions under section two of this act. If the money to his credit as aforesaid is in excess of the amount that will be required to purchase such annuity he may withdraw such excess in one cash sum, or in an annuity certain limited to the age of retirement.

The Secretary of the Treasury shall reduce or terminate the disability allowance granted to any employee whenever in his judgment it is proper to do so, and such action on his part shall be final and conclusive.

In case of the death of an employee while in the receipt of a disability allowance, the amount to his credit under section two of this act shall be paid to his legal heirs, and the disability allowance shall cease and determine. The disability allowances hereby provided for shall at all times be limited to the fund created by section eight of this act, and if the total allowances shall at any time be in excess of such fund the allowances shall be reduced pro rata to a sum within such fund.

SEC. 10. That in case of reinstatement in the classified civil service of any person who at the time of his separation therefrom received a refund under section seven of this act, his period of service for the purpose of retirement and of making the monthly deduction from his salary shall be computed from the date of such reinstatment, unless he shall, within ninety days after reinstatement, pay to the Secretary of the Treasury the amount refunded to him, with interest at three and one-half per centum per annum, in which case the same shall be replaced to the credit of his account, and the former period of service shall be counted.

SEC. 11. That beginning with the first day of July next following the passage of this act every employee to whom this act applies shall be entitled, on reaching the retirement age, or having already passed that age, to retire from the service under the provisions hereinbefore contained, and also, in addition to the annuity herein provided for by his own contributions from his salary, to receive from the United States during the remainder of his life an annuity equal to one and one-half per centum of his total compensation during service prior to the taking effect of this act; and the Secretary of the Treasury is hereby authorized and directed to pay such annuity quarterly, upon proper certification of the retirement of such employee by the appointing officer under whom he last served. Annuities from the United States for the period of service prior to the passage of this act shall be payable only on condition that the employee remains in the service until he reaches the age of retirement: Provided, however, That employees of group one may receive the annuity granted by this section on retirement at the age of sixty years or thereafter. On the death of the employee the payment of annuities provided

for by this section shall cease and determine. Annuities payable by the United States on salaries in excess of two thousand five hundred dollars per annum shall be based upon an annual salary of two thousand five hundred dollars.

SEC. 12. That the period of service upon which the annuity to be paid by the United States is based shall be computed from original employment, whether as a classified or unclassified employee, and shall include periods of service at different times and service in one or more departments, branches, or independent offices of the Government, the Signal Corps prior to July first, eighteen hundred and ninety-one, and the general service in or under the War Department prior to May sixth, eighteen hundred and ninety-six.

SEC. 13. That every person to whom this act applies who shall continue in the classified civil service after the passage of this act, as well as every person to whom this act applies who may hereafter be appointed to a position or place, shall be deemed to consent and agree to the deductions made and provided for herein, and shall receipt in full for the salary, pay, or compensation which may be paid monthly or at any other time, and such payment shall be a full and complete discharge and acquittance of all claims or demands whatsoever for services rendered by such person during the period covered by such payment, notwithstanding the provisions of sections one hundred and sixty-seven, one hundred and sixty-eight, and one hundred and sixty-nine of the Revised Statutes of the United States, or of any other law, rule, or regulation affecting the salary, pay, or compensation of any person or persons employed in the classified civil service to whom this act applies.

SEC. 14. That the Secretary of the Treasury shall prepare and keep all needful tables, records, and accounts required for carrying out the provisions of this act. The records to be kept shall include data showing the mortality experience of the employees in the various branches of the service and the rate of withdrawal from the classified service, and any other information that may be of value and may serve as a guide for future valuations and adjustments of the plan for the retirement of employees. The Secretary of the Treasury shall make a detailed comparative report annually to Congress showing all receipts and disbursements under the provisions of this act, together with the total number of persons receiving annuities and disability allowances and the amounts paid them.

SEC. 15. That the provisions of this act shall apply only to the classified civil service in the District of Columbia, which is hereby defined to include all officers and employees in the executive civil service of the United States in the District of Columbia, except persons appointed by the President and confirmed by the Senate, and unskilled laborers. No person serving in a position excepted from examination or registration as defined in the civil-service rules shall be included within the provisions of this act unless he has served in a competitive position for at least one year. Whenever any person becomes separated from the classified service by reason of appointment in the unclassified service, such separation shall not operate to take him out of the provisions of this act. The President shall have power, in his discretion, to exclude from the operation of this act any group of employees whose tenure of office is intermittent or of uncertain duration.

SEC. 16. That none of the moneys mentioned in this act shall be assignable either in law or equity or be subject to execution or levy by attachment, garnishment, or other legal process.

SEC. 17. That for the clerical and other service and all other expenses necessary in carrying out the provisions of this act during the fiscal year nineteen hundred and ten, including salaries and rent in the city of Washington, there is hereby appropriated the sum of twenty thousand dollars out of any money in the Treasury not otherwise appropriated, to be available until expended.

SEC. 18. That the Secretary of the Treasury is hereby authorized to perform or cause to be performed any and all acts and to make such rules and regulations as may be necessary and proper for the purpose of carrying the provisions of this act into full force and effect.

APPENDIX B.

TEXT OF GILLETT BILL.

[H. R. 22013, Sixty-first Congress, second session.]

A BILL for the retirement of employees in the classified civil service.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That beginning with the first day of July next following the passage of this act there shall be deducted and withheld from the monthly salary, pay, or compensation of every officer or employee of the United States to whom this act applies an amount, computed to the nearest tenth of a dollar, that will be sufficient, with interest thereon at three and onehalf per centum per annum, compounded annually, to purchase from the United States, under the provisions of this act, an annuity, payable quarterly, throughout life, for every such employee on arrival at the age of retirement as hereinafter provided, equal to one and one-half per centum of his annual salary, pay, or compensation for every full year of service or major fraction thereof between the date of the passage of this act and the arrival of the employee at the age of retirement. The deductions hereby provided for shall be based on such annuity table as the Secretary of the Treasury may direct, and interest at the rate of three and one-half per centum per annum, compounded annually, and shall be varied to correspond to any change in the salary of the employee.

SEC. 2. That the amounts so deducted and withheld from the salary, pay, or compensation of each employee shall be deposited in the Treasury of the United States and shall be credited, together with interest at three and one-half per centum per annum, compounded annually, to an individual account of the employee from whose salary, pay, or compensation the deduction is made. The moneys so deducted and the income derived therefrom may from time to time be deposited in savings banks designated by the Secretary of the Treasury for that purpose: Provided, however, That the savings banks receiving such deposits shall pay interest thereon at a rate of not less than three and one-half per centum per annum, compounded annually. For the safe-keeping and prompt payment of the money deposited with them the Secretary of the Treasury shall require the savings banks to give satisfactory security, by the deposit of bonds of the United States, bonds or other interest-bearing obligations of any State of the United States, or any legally authorized bonds issued for municipal purposes by any city or town in the United States which has been in existence as a city or town for a period of twenty-five years, and which for a period of ten years previous to such deposit has not defaulted in the payment of any part of either principal or interest of any funded debt authorized to be contracted by it, and which has at such date more than twenty-five thousand inhabitants, as established by the last national census, and whose net indebtedness does not exceed five per centum of the valuation of the taxable property therein, to be ascertained by the last preceding valuation of property for the assessment of taxes; or any legally authorized bonds issued for municipal purposes by any city or

town in the United States which has been in existence as a city or town for a period of twenty-five years, and which for a period of ten years previous to such deposit has not defaulted in the payment of any part of either principal or interest of any funded debt authorized to be contracted by it, and which has at such date more than two hundred thousand inhabitants, as established by the last national census, and whose net indebtedness does not exceed seven per centum of the valuation of the taxable property therein, to be ascertained by the last preceding valuation of property for the assessment of taxes. In this clause the words "net indebtedness" mean the indebtedness of any city or town, omitting debts created for supplying the inhabitants with water, and debts created in anticipation of taxes to be paid within one year, and deducting the amount of sinking funds available for the payment of the indebtedness included. The Secretary of the Treasury shall accept, for the purpose of this act, securities herein enumerated in such proportions as he may from time to time determine, and he may at any time require the deposit of additional securities, or require any bank to change the character of the securities already on deposit. It shall be the duty of the Secretary of the Treasury to obtain information with reference to the value and character of the securities authorized to be accepted under the provisions of this section, and he shall from time to time furnish information to savings banks as to such bonds as would be accepted as security. When consistent with the best interests of the fund created by this act, the Secretary of the Treasury shall distribute the deposits herein provided for, as far as practicable, equitably between the different States and sections.

If, for any reason, the Secretary of the Treasury shall not be able to make satisfactory arrangements with savings banks for all of the funds, then he may invest the balance in any of the aforementioned securities.

The moneys deducted from salaries and the income derived therefrom shall be held and deposited or invested, as above described, by the Secretary of the Treasury until paid out as hereinafter provided. Any deficiency in the fund hereby created to carry out the provisions of this act shall be paid out of any money in the Treasury not otherwise appropriated.

For the purpose of aiding the Secretary of the Treasury in depositing and investing the funds created by this act a board of investment is hereby created, composed of the Treasurer of the United States, the Comptroller of the Currency, the chief of the office created by the provisions of this act, and two persons to be designated by the President from among the employees of the classified civil service. The members of the board of investment shall be sworn, and shall hold office until others are appointed and qualified in their stead.

SEC. 3. That the retirement age herein referred to shall be sixty-five years for group one, sixty-five years for group two, and seventy years for group three. And the President of the United States shall designate the branches of the service to be included in each group.

SEC. 4. That if within thirty days before the arrival of an employee at the age of retirement the head of the department or independent office in which he is employed certifies to the Secretary of the Treasury that by reason of his efficiency and his willingness to remain in the service the continuance of such employee therein would be advantageous to the public service, such employee may be retained for a term not exceeding two years; and at the end of the two years he may by similar certification be continued for an additional term of two years, and so on: Provided, however, That after the first day of July, nineteen hundred and twenty, no person to whom this act applies shall be continued in the service beyond the age of retirement as herein provided. Upon

the failure of the head of the department or independent office to make the above-described certificate it shall be the duty of the Secretary of the Treasury to place such employee upon the retired list in accordance with the provisions of this act.

SEC. 5. That if an employee is retained in the service after reaching the retirement age a deduction of ten per centum of his monthly salary, pay, or compensation shall thereafter be made while he remains in the service, and the same shall be treated as other deductions under section two of this act.

SEC. 6. That upon retiring at the age of retirement, or thereafter, the employee may withdraw his savings, with the increment of interest as herein provided, under one of the following options, and if Option I or Option II is selected, receive in addition thereto such annuity, if any, as may be apportioned by the Secretary of the Treasury out of accumulations in excess of three and one-half per centum guaranteed by the provisions of this act, and such apportionment by the Secretary of the Treasury shall be conclusive:

Option I. In an annuity payable quarterly throughout life.

Option II. In an annuity payable quarterly throughout life, with the provision that in case of the death of the annuitant before he has received in annuities the amount of his savings, plus the interest credited thereon, the balance shall be paid to his legal heirs. In determining at his death the amount due to his heirs no account shall be taken of the annuities paid to him by the United States under section eleven of this act.

Option III. In one sum.

If after retirement the employee does not avail himself of one of the foregoing options, but leaves the amount due him on deposit, interest at the rate of two per centum per annum on the original sum so left on deposit on retirement shall be credited thereto for a period not exceeding twenty years, and if not then withdrawn the money so left on deposit, without interest, shall be covered into the Treasury as a miscellaneous receipt.

SEC. 7. That upon absolute separation from the civil service prior to the retirement age, and only upon such separation, the employee may withdraw his savings in one sum, and in case he has been in such service not less than six years he may also receive in addition thereto interest on his savings at the rate of three and one-half per centum per annum, compounded annually; or, in case his savings amount to at least one thousand dollars, he may withdraw the same under any one of the foregoing options computed on the basis of his attained age. In case of the death of an employee while in the service the amount of his savings, together with the interest credited thereon, shall be paid to his legal heirs.

SEC. 8. That beginning with the first day of July next following the passage of this act there shall be deducted and withheld from the monthly salary, pay, or compensation of every employee newly entering the service to whom this act applies an amount equal to one-fifth of his monthly salary, pay, or compensation during the first six months of his employment; and in every case of promotion of any person to whom this act applies there shall be deducted and withheld from the monthly salary, pay, or compensation of such person an amount equal to the increase made by such promotion during the first three months from the taking effect thereof; and the amounts so deducted and withheld shall be deposited in the Treasury of the United States to the credit of a special fund to carry out the provisions of section nine of this act.

SEC. 9. That beginning one year after the first day of July next following the passage of this act, any employee to whom this act applies, who, by reason of accident or illness not due to vicious habits or by reason of exigencies of the service but without fault or delinquency on his part, has become totally and