United States
Office of
Personnel Management
The Federal Government’s Human Resources Agency
Benefits Administration Letter
Number: 17-303 - Revised Date: September 2018
Subject: Fiscal Year 2017 Cost Factors for Calculating Imputed Costs
This Letter provides the fiscal year (FY) 2017 cost factors for the Federal civilian benefit
programs. Agencies will use these factors to calculate their imputed costs relating to the Civil
Service Retirement System (CSRS), the Federal Employees Retirement System (FERS),
the Federal Employees Health Benefits Program (FEHB) and the Federal Employees’ Group
Life Insurance Program (FEGLI). The imputed costs are used to determine the actuarial liabilities
which are included in Governmental financial statements.
Benefits Administration Letter (BAL) 03-309, dated September 15, 2003, provides detailed
instructions for the computation and accounting for imputed costs related to the Federal civilian
benefit programs; see http://www.opm.gov/retire/pubs/bals/2003/03-309.pdf for more information.
COST FACTORS
Pensions. The economic assumptions used to calculate the FY 2017 cost factors under Statement of
Federal Financial Accounting Standard (SFFAS) 33: Pensions, Other Retirement Benefits, and
Other Postemployment Benefits: Reporting the Gains and Losses from Changes in Assumptions and
Selecting Discount Rates and Valuation Dates are based on 10-year historical averages. These
economic assumptions differ from those established by OPM under guidance from the CSRS Board
of Actuaries for the determination of certain statutory funding payments for CSRS and FERS.
For most CSRS-covered employees, the FY 2017 cost factor is 32.8 percent of basic pay. The
FY 2017 cost factors for all categories of CSRS coverage are attached. While agency payments
under CSRS are not affected by the CSRS normal cost percentages for the vast majority of agencies,
the CSRS normal cost percentages determined under SFFAS 33 are used to determine the actuarial
liabilities which are included in Governmental financial statements.
The FY 2017 cost factors reported in this BAL also differ from the normal cost percentages used to
determine the employer contributions agencies pay for FERS employees. For most FERS-covered
employees, the FY 2017 cost factor is 14.7 percent of basic pay. The cost factors for all categories of
FERS coverage are attached. Since the cost factors reported under SFFAS 33 are determined on a
different basis than are the actual FERS normal cost contributions, agencies should expect to continue
to report future imputed retirement costs for their FERS employees.
