REPORT OF THE SECRETARY 7 



TRUST FUNDS' EMPLOYEES INCLUDED UNDER FEDERAL RETIREMENT 



SYSTEM 



For many years employees of the Institution have been divided into 

 two categories: The first, and by far the larger group, consists of 

 civil-service employees paid from Federal appropriations ; the second, 

 now numbering some 35 employees, consists of employees paid wholly 

 or in part from Smithsonian trust funds. The first group, of course, 

 has been covered by the Federal Retirement System ; the second group 

 had up to 1939 no provision whatever for retirement. On July 1, 

 1939, the Smithsonian Retirement System was put into effect to pro- 

 vide retirement benefits for those employees paid from trust funds, but 

 the number of members was so small that the system was unable to 

 offer anything like as liberal benefits as the Federal System as 

 amended in 1942. 



During the fiscal year 1947, the Civil Service Commission took under 

 advisement the inclusion of trust funds' employees under the Federal 

 System, and pending a decision, the Board of Regents of the Institu- 

 tion at its annual meeting on January 17, 1947, passed the following 

 resolution : 



Resolved, That the Board of Regents of the Smithsonian Institution do hereby 

 consent to the officers and members of the Smithsonian Institution paid from 

 trust funds accepting the benefits and privileges of the Federal Retirement Sys- 

 tem, as well as assuming the obligations and duties legally applicable to them 

 under that system as presently constituted ; Provided further. 



That the Board of Regents of the Smithsonian Institution does not consent 

 to the application of the Federal civil-service laws, nor the Federal Classification 

 Act of 1923, as amended, to such officers and members paid from trust funds, nor 

 to the application of any other laws which would in any way contravene the act 

 of Establishment of the Smithsonian Institution approved on August 10, 1846, 

 with amendments thereto. 



Resolved, That the Regents of the Smithsonian Institution, if and when officers 

 and members of the Smithsonian Institution paid from trust funds are placed 

 under the Federal Retirement System, approve in principle the use of the funds 

 now held in the Smithsonian Retirement Fund for the benefit of the employees in 

 question, to secure for said employees the maximum protection under the Federal 

 Retirement Act to which their length of service in the Smithsonian Institution, 

 respectively, entitles them; and that the Secretary be authorized to work out 

 the necessary plans to carry this into effect, with the approval of the executive 

 committee, to which is given full power to act in this matter. 



A decision was reached by the Commission on May 16, and on May 

 22 I sent the following memorandum to the members of the Smith- 

 sonian Retirement System : 



The Civil Service Commission has decided under date of May 16, 1947, that 

 Smithsonian employees paid from trust funds of the Institution are eligible for 

 inclusion under the Federal Retirement System. In accordance with the ap- 

 proval of the Board of Regents, the Smithsonian Retirement System is therefore 

 abolished, effective at the close of business May 17, 1947, except insofar as it 



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