About 50,000 federal workers in Hawai'i, Alaska and U.S. territories would lose cost of living adjustments in their paychecks but gain higher retirement pay under a proposal being considered in Congress.

A provision in the final version of the national defense authorization bill that soon will be voted on in the House and Senate will phase out COLA pay over three years for federal workers in these places.

The COLA pay was not taxed and it was not calculated into retirement benefits. But the provision, sponsored by Hawaii U.S. Sen. Daniel Akaka, would shift such workers from cost of living adjustments to so-called locality pay, which is included in retirement calculations.

LAWSUIT TARGETS SHIPPING LAW

Republican gubernatorial candidate John Carroll is suing the federal government in an effort to overturn an 89-year-old law that restricts interstate shipping to U.S.-built and U.S.-flagged ships.

The law also restricts interstate shipping to U.S.-owned vessels crewed mainly by U.S. citizens.

Carroll filed his lawsuit Wednesday in U.S. District Court in Hawai'i.

The lawsuit contends the Jones Act violates the Constitution's Commerce Clause by artificially inflating prices of goods shipped between Hawai'i and the Mainland to such an extent that it becomes an unlawful restraint on trade and interstate commerce.