Description of Proposed Provision:
B3.6: Progressive indexing (30th percentile) of PIA factors beginning with individuals newly eligible for OASI benefits in 2020, continuing through 2069: Create a new bend point at the 30th percentile of the AIME distribution of newly retired workers. Maintain current-law benefits for earners at the 30th percentile and below. Reduce the 32 and 15 percent factors above the 30th percentile such that the initial benefit for a worker with AIME equal to the taxable maximum is reduced by 1.20 percent per year as compared to current law (for the years that progressive indexing applies). Disabled workers are: (a) not affected prior to normal retirement age; and (b) subject to a proportional reduction in benefits, based on the worker's years of disability, upon conversion to retired-worker beneficiary status.

Financial Estimates for the OASDI Trust Fund Program

  Proposal   Change from Current Law
  Expressed as a percentage of
current-law taxable payroll

Trust fund
ratio as of
January 1
Expressed as a percentage of
current-law taxable payroll
Calendar
year
Cost
rate
Income
rate
Annual
balance

Cost
rate
Income
rate
Annual
balance
201713.4113.03-0.38
298
0.000.000.00
201813.4912.93-0.56
287
0.000.000.00
201913.7012.95-0.75
273
0.000.000.00
202013.8512.96-0.89
259
-0.00-0.000.00
202114.0112.99-1.02
245
-0.00-0.000.00
202214.2513.02-1.23
230
-0.00-0.000.00
202314.5313.05-1.49
215
-0.01-0.000.01
202414.8113.08-1.73
199
-0.02-0.000.02
202515.0713.10-1.97
183
-0.03-0.000.03
202615.3313.13-2.20
166
-0.04-0.000.04
202715.5613.15-2.41
149
-0.06-0.000.06
202815.7713.16-2.61
132
-0.08-0.000.08
202915.9613.18-2.78
114
-0.11-0.010.10
203016.1213.19-2.94
97
-0.14-0.010.13
203116.2713.20-3.07
79
-0.18-0.010.17
203216.3913.21-3.18
61
-0.22-0.010.21
203316.4813.21-3.27
42
-0.26-0.010.25
203416.5413.22-3.32
23
-0.31-0.020.29
203516.5713.22-3.35
4
-0.36-0.020.34
203616.5813.22-3.36
----
-0.41-0.020.38
203716.5613.22-3.34
----
-0.46-0.030.44
203816.5113.22-3.29
----
-0.52-0.030.49
203916.4213.22-3.21
----
-0.57-0.030.54
204016.3313.21-3.12
----
-0.63-0.040.60
204116.2313.21-3.02
----
-0.69-0.040.65
204216.1113.20-2.91
----
-0.75-0.040.71
204315.9913.19-2.80
----
-0.81-0.050.77
204415.8813.19-2.69
----
-0.88-0.050.83
204515.7713.18-2.59
----
-0.95-0.050.89
204615.6613.18-2.49
----
-1.01-0.060.96
204715.5613.17-2.39
----
-1.09-0.061.02
204815.4613.17-2.29
----
-1.16-0.071.09
204915.3613.16-2.20
----
-1.23-0.071.16
205015.2613.16-2.10
----
-1.30-0.071.23
205115.1813.15-2.02
----
-1.38-0.081.30
205215.1013.15-1.95
----
-1.46-0.081.37
205315.0313.15-1.89
----
-1.53-0.091.45
205414.9813.14-1.83
----
-1.61-0.091.52
205514.9313.14-1.78
----
-1.69-0.101.60
205614.8813.14-1.74
----
-1.77-0.101.67
205714.8413.14-1.70
----
-1.86-0.111.75
205814.8013.14-1.67
----
-1.94-0.111.83
205914.7713.13-1.63
----
-2.02-0.111.90
206014.7313.13-1.60
----
-2.09-0.121.98
206114.7013.13-1.57
----
-2.17-0.122.05
206214.6713.13-1.54
----
-2.25-0.132.12
206314.6413.13-1.51
----
-2.33-0.132.19
206414.6213.13-1.49
----
-2.40-0.142.26
206514.5913.13-1.46
----
-2.48-0.142.34
206614.5613.13-1.44
----
-2.55-0.152.41
206714.5413.12-1.42
----
-2.63-0.152.48
206814.5213.12-1.39
----
-2.70-0.152.55
206914.5013.12-1.37
----
-2.78-0.162.62
207014.4713.12-1.35
----
-2.85-0.162.69
207114.4513.12-1.33
----
-2.92-0.172.76
207214.4213.12-1.30
----
-2.99-0.172.82
207314.3913.12-1.27
----
-3.06-0.182.89
207414.3513.12-1.23
----
-3.13-0.182.95
207514.3113.11-1.20
----
-3.19-0.183.01
207614.2713.11-1.16
----
-3.25-0.193.06
207714.2213.11-1.11
----
-3.30-0.193.11
207814.1713.11-1.07
----
-3.35-0.193.16
207914.1313.10-1.02
----
-3.39-0.193.20
208014.0813.10-0.98
----
-3.43-0.203.23
208114.0413.10-0.94
----
-3.47-0.203.27
208214.0013.10-0.91
----
-3.50-0.203.30
208313.9813.09-0.88
----
-3.54-0.203.33
208413.9613.09-0.86
----
-3.57-0.203.37
208513.9513.09-0.85
----
-3.60-0.213.40
208613.9413.09-0.85
----
-3.64-0.213.43
208713.9513.09-0.85
----
-3.67-0.213.46
208813.9513.09-0.86
----
-3.70-0.213.49
208913.9713.09-0.87
----
-3.73-0.213.52
209013.9913.10-0.89
----
-3.76-0.223.55
209114.0013.10-0.91
----
-3.79-0.223.57
209214.0313.10-0.93
----
-3.82-0.223.60


Summarized Estimates

  Proposal   Change from Current Law
Years Cost
rate
Income
rate
Actuarial
balance

Year of reserve
depletion
1

Cost
rate
Income
rate
Actuarial
balance
2017-2091 15.17% 13.75% -1.41%
2035
-1.50% -0.08% 1.41%

1 Under current law, the year of Trust Fund reserve depletion is 2034.
Based on Intermediate Assumptions of the 2017 Trustees Report.