1. Greetings from AFSA President John Naland. Here is what we are working on at AFSA headquarters. As always, I welcome your comments or suggestions at naland@afsa.org. Season's Greetings!

WHAT NOW?

2. Many members have contacted me asking when AFSA will send out a message outlining where we see things going in the wake of the Iraq directed assignments controversy and the recent announcement that severe staffing shortfalls at State will require leaving numerous overseas and domestic positions vacant. The answer is that we will do so in early January after year end meetings with the Under Secretary for Political Affairs, the Under Secretary for Management, the Director General, the Assistant Secretary for Legislative Affairs, the Director of the Foreign Service Institute, and key staff at the President's Office of Management on Budget.

OVERSEAS PAY DISPARITY

3. Although 2007 will end with pay modernization legislation still pending, a potentially important development took place in recent days. The White House, Congress, and major Civil Service unions reached an agreement to implement a modified pay for performance scheme at the Department of Defense. That boosts our efforts because it shows that it is possible to "square the circle" between Congressional concerns about the fairness of pay for performance and the White House insistence on ending the overseas pay disparity via a pay for performance system.

4. We are pleased that Rep. Mike Honda (D-CA) and Rep. Jim Moran (D-VA) have engaged in supporting a legislative fix to the pay disparity problem. We thank them and their colleagues who have come on board to officially support finding a solution.

INTERNATIONAL AFFAIRS BUDGETS

5. We may learn in the next week how the still-pending Fiscal Year 2008 budget for international affairs will come out. In a letter to editor that we understand will be published in a major U.S. newspaper in the next few days, AFSA makes a strong pitch for Congress and the White House to provide our diplomats with the resources they need to advance America's foreign policy goals in the face of unprecedented overseas challenges and dangers.

6. Even though the Fiscal Year 2008 budget had not yet passed, the Administration is necessarily preparing its Fiscal Year 2009 budget request to Congress. That internal process typically includes significant back and forth between State and USAID and the White House Office of Management and Budget. AFSA has weighed in via a letter to President Bush citing the critical need to seek funding for more Foreign Service positions. I noted in that letter that the Foreign Service cannot continue to be expected to transfer positions from one important diplomatic post to another vital post without the system breaking under the weight of what is expected. We will continue to advocate with the White House in these last few days before the Fiscal Year 2009 budget request is finalized.

UNUSED SICK LEAVE UPON RETIREMENT

7. Rep. Jim Moran (D-VA) is posed to offer legislation to compensate federal employees in the Federal Employees Retirement System for their unused sick leave upon retirement. This legislation will also affect employees in the Foreign Service Pension System, inasmuch as the Foreign Service Act provides for conformity between FERS and FSPS. Currently, federal employees in both FERS and FSPS receive no credit at retirement for unused sick leave. This differs from the treatment of unused sick leave under the old retirement systems, the Civil Service Retirement System and the Foreign Service Retirement and Disability System. Employees under the old systems are able to apply unused sick leave to their length-of-service calculations and, as a result, increase the value of their retirement annuities.

8. AFSA believes the legislation if passed will help to remedy the disparity in treatment and, in so doing, send a clear message to federal workers that our country appreciates their dedication to public service both here and abroad. AFSA has engaged this issue and will continue to express the perspective of the Foreign Service as this bill gets closer to being offered. Prospects for passage next year are not yet clear.

FOREIGN SERVICE VICTIMS OF TERRORISM ACT OF 2007

9. On the morning of August 7, 1998 terrorists destroyed our embassies in Nairobi and Dar es Salaam in the most devastating attack ever launched against any of our diplomatic facilities. More than 5,000 individuals were seriously wounded and 224 people lost their lives that day. The House of Representatives passed nearly unanimously H.R. 2828 (“Foreign Service Victims of Terrorism Act of 2007”), a bill which institutionalizes a comprehensive compensation scheme for the victims of the 1998 attacks. The measure also enhances death gratuity compensation provisions for current Foreign Service officers killed by acts of terror. Unfortunately, the measure is stalled in the Senate. While the bill passed through committee level, a “hold” has been placed on the floor by an unnamed Senator for reasons unknown to the victim’s families and AFSA. We are looking for ways to help get past this remaining hurdle and urge the Department of State to do likewise.

AFSA LEGAL DEFENSE FUND

10. As previously reported, AFSA recently created a legal defense fund to provide financial assistant to members in cases involving issues of significant institutional importance to the Foreign Service. Last month, the AFSA Governing Board named the fund after Richard C. Scissors, a retired Foreign Service officer and beloved AFSA colleague who passed away in September. (See Foreign Service Journal, December 2007, page 51.)  So far, AFSA has received over $10,000 in contributions from approximately 180 donors. We thank all who have contributed so generously to the fund. For those of you who wish to make a donation, please make your check out to “Richard C. Scissors Legal Defense Fund at AFSA” and mail it to: Richard C. Scissors Legal Defense Fund, American Foreign Service Association, PO Box 98026, Washington, DC 20090-8026. At present, your contributions are not tax deductible. AFSA is exploring the possibility of obtaining 501(c)(3) status from the IRS in the future. We will keep you advised on our progress.

DECEMBER FOREIGN SERVICE JOURNAL

11. The December 2007 Journal is in the mail to members and subscribers.  This month's issue focuses on country team management ("Country Teamwork: Is State Still Running Embassies?").  It includes articles by frequent contributor Shawn Zeller, retired Ambassador Edward Peck, and mid-level FSO Mark Johnsen, in addition to excerpts from the October study by the Center for Strategic & International Studies on "The Embassy of the Future." Elsewhere in the issue, you'll find another AFSA Issue Brief ("Telling Our Story"), an appreciation of the late Richard Scissors, our semiannual Schools Supplement advertising section, and much more!

AFSA WEBSITE

12. If you have not visited AFSA's home page in a while, please take a look. There you can find recent update messages, AFSA op-eds, and Press Releases on a range of issues.

PREMIUM CONVERSION FOR PUBLIC SAFETY OFFICERS

13. Attention retired Diplomatic Security Special Agents and related specialists: Section 845 of the Pension Protection Act of 2006 allows retired “public safety officers” a limited premium conversion tax advantage. They can now exclude up to $3,000 in qualified health and long-term insurance premiums from their gross income distributions from eligible retirement plans. The premiums must be paid directly from the retirement systems.

Participants, however, must establish that they satisfy the Internal Revenue Service definition of “public safety officer.” To do so, they must identify themselves as eligible and report the exclusion to the IRS. The definition of a public safety officer generally is limited to those who were law enforcement officers.

14. In a recent letter to the IRS, Rep. Tom Davis, (R-VA), asked the agency to clarify the definition of "public safety officer, stating that "Many federal retirees who served in a law enforcement capacity but did not carry a badge and weapon or have arrest authority are unsure as to whether they may apply for the exclusion." He went on to say that neither the IRS nor the Office of Personnel Management has provided retirees with adequate answers regarding eligibility and that some retired public safety officers are reluctant to self-report the tax exclusion to the IRS because they fear the agency will rule them ineligible after their tax returns are filed, subjecting them to penalties.

15. Rep. Davis urged the IRS to develop better guidance on the law for taxpayer information call centers and in the 2007 version of a tax guide for civil service retirement benefits. He also urged the tax agency to provide more specific eligibility information to congressional offices and federal retiree and employee organizations. AFSA will keep you informed of any developments.

NEW AFSA SPEAKER SERIES

16. Amb. Wendy Chamberlin, President of the Middle East Institute in Washington, DC, inaugurated the Caroline and Charles Adair speaker series on American Diplomacy by addressing some 110 faculty and students at American University’s School of International Service last month. Amb. Chamberlin spoke on “The Critical Role of the Foreign Service in Defending National Interests.” She enthralled her audience by describing the extreme challenges she faced as ambassador to Pakistan in 2001-02. She also provided compelling insights on Pakistan’s current leadership crisis.

17. This new series is made possible through a generous endowed gift to the Fund for American Diplomacy from former AFSA president Marshall Adair and Mrs. Adair. In 2006 the Adair family created the endowment in memory of Marshall Adair’s parents, Caroline and Amb. Charles W. Adair. Active and retired AFSA members are encouraged to contribute to the Fund for American Diplomacy, which supports a variety of public programs that enhance awareness of the importance of diplomacy and the U.S. Foreign Service in securing national security and economic interests.

SUPPORT AFSA IN THE CFC

18. AFSA has two non-profit funds that federal employees can make a CFC gifts to:

-- AFSA Scholarship Fund (CFC #11759): In 2007, the AFSA Scholarship Fund provided need-based undergraduate scholarships to 52 Foreign Service kids totaling $138,400 along with providing $28,500 in Academic and Art Merit awards to 25 Foreign Service high school seniors. The overhead of the AFSA Scholarship Program is 10%. AFSA Financial Aid Scholarships range from $1,500- $3,500 and Merit Awards range from $500-$1,500. Your support stays in the Foreign Service community. Go to http://www.afsa.org/scholar/ for complete details.

-- Fund for American Diplomacy (CFC #10646): The Fund for American Diplomacy (FAD) is AFSA's public education arm. We explain to high schoolers, college students, business leaders, senior citizens, media, etc. just how critical U.S. diplomacy and the Foreign Service are to America's national security and economic prosperity. Our speakers’ bureau, high school essay contest, and best selling book "Inside a U.S. Embassy" are just a few examples of the grassroots programs we offer. FAD's overhead expenses are only 7.3 percent. Go to <http://www.afsa.org/CFCFAD.cfm> for complete details.