Propriety of Retired Pay Reduction

A decision was requested as to the propriety of reducing the retired pay of a U.S. Marine Corps colonel to provide coverage for his spouse under the Survivor Benefit Plan (SBP). According to the record, the colonel was transferred to the retired list; later he was recalled to active duty for 2 years. The colonel's tour of duty was extended twice. Not having elected SBP prior to his recall to active duty, the colonel submitted an SBP election to provide full coverage for his spouse upon his return to the retired list. Based on that election, the Marine Corps initiated an SBP coverage deduction from his retired pay. Doubt was expressed as to the propriety of that action since the colonel failed to elect coverage within the time authorized for individuals who were retired at the time the SBP provision was passed. In prior decisions, a member who was entitled to retired or retainer pay on the effective date of the SBP and who was married or had a dependent child was eligible to elect to participate in SBP during the 18-month period following the effective date. The legislative history of that provision shows that the participation of individuals already retired was to be consistent with the rules for participation established for future retirees. An individual retired before the effective date of the provision could elect coverage in the plan at any time during the entire 18-month period, but after an election was made it could not be revoked or changed except on the basis of a finding that administrative error was involved. Those decisions were based on the assumption that the retiree did not return to active duty during the 18-month election period. The colonel could have elected coverage during that period. However, during that latter part of the 18-month period, he was on extended active duty. In view of the purpose of the plan, to include as many retirees as possible, and since the statutory provisions themselves do not provide a specific rule to be applied in this situation, GAO believed it would be unnecessarily strict to hold that the individual was required to elect coverage by the end of the 18-month period even though he was on extended active duty during the latter part of that period. Accordingly, the colonel's retired pay was properly reduced for SBP coverage, and he should be considered covered under the terms of his election.