A-73809, MAY 7, 1936, 15 COMP. GEN. 968

A-73809: May 7, 1936

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RETIREMENT DEDUCTIONS - CIVILIAN MEMBERS OF NAVAL ACADEMY TEACHING STAFF FURNISHED QUARTERS THE REASONABLE RENTAL VALUE OF GOVERNMENT QUARTERS FURNISHED A CIVILIAN MEMBER OF THE NAVAL ACADEMY TEACHING STAFF IS FOR ADDITION TO THE ACTUAL CASH SALARY PAID IN DETERMINING THE COMPENSATION DEDUCTION IN THE FORM OF A MONTHLY ALLOTMENT TO BE REGISTERED UNDER THE ACT OF JANUARY 16. IS TO BE COMPUTED ON THE COMBINED AMOUNT. WAS FIXED. THE "REASONABLE VALUE OF THE GOVERNMENT QUARTERS ASSIGNED" TO PROFESSOR ALDEN WAS DETERMINED BY THE SECRETARY OF THE NAVY TO BE $1. "AND IS CONSIDERED A PART OF HIS COMPENSATION IN ADDITION TO THE SALARY OF $6. THE AMOUNT PAID PROFESSOR ALDEN IN CASH AND THE VALUE OF THE PUBLIC QUARTERS ASSIGNED TO HIM ARE SHOWN ON THE SEMIMONTHLY PAY ROLLS FOR EACH PERIOD.

A-73809, MAY 7, 1936, 15 COMP. GEN. 968

RETIREMENT DEDUCTIONS - CIVILIAN MEMBERS OF NAVAL ACADEMY TEACHING STAFF FURNISHED QUARTERS THE REASONABLE RENTAL VALUE OF GOVERNMENT QUARTERS FURNISHED A CIVILIAN MEMBER OF THE NAVAL ACADEMY TEACHING STAFF IS FOR ADDITION TO THE ACTUAL CASH SALARY PAID IN DETERMINING THE COMPENSATION DEDUCTION IN THE FORM OF A MONTHLY ALLOTMENT TO BE REGISTERED UNDER THE ACT OF JANUARY 16, 1936, 49 STAT. 1092, TOWARD THE PURCHASE OF AN ANNUITY FOR SAID MEMBER, AND THE PERCENTAGE TO BE ADDED TO HIS SALARY, CONTINGENT ON HIS REGISTERING SUCH ALLOTMENT, IS TO BE COMPUTED ON THE COMBINED AMOUNT.

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF THE NAVY, MAY 7, 1936:

THERE HAS BEEN RECEIVED YOUR LETTER OF APRIL 10, 1936, REQUESTING DECISION AS FOLLOWS:

THE SALARY OF PROFESSOR C. S. ALDEN, DURING HIS DETAIL AS HEAD OF THE DEPARTMENT OF ENGLISH AND HISTORY AT THE U.S. NAVAL ACADEMY, WAS FIXED,EFFECTIVE AUGUST 1, 1924, AT $6,000 PER ANNUM, WITH THE UNDERSTANDING THAT HE WOULD OCCUPY GOVERNMENT QUARTERS. ON JUNE 24, 1926, THE "REASONABLE VALUE OF THE GOVERNMENT QUARTERS ASSIGNED" TO PROFESSOR ALDEN WAS DETERMINED BY THE SECRETARY OF THE NAVY TO BE $1,440 PER ANNUM,"AND IS CONSIDERED A PART OF HIS COMPENSATION IN ADDITION TO THE SALARY OF $6,000 PREVIOUSLY FIXED AND NOW CONTINUED.' THE AMOUNT PAID PROFESSOR ALDEN IN CASH AND THE VALUE OF THE PUBLIC QUARTERS ASSIGNED TO HIM ARE SHOWN ON THE SEMIMONTHLY PAY ROLLS FOR EACH PERIOD.

SINCE PROFESSOR ALDEN HAS APPLIED FOR PERMISSION TO PARTICIPATE IN THE BENEFITS GRANTED BY THE ACT OF JANUARY 16, 1936 (PUBLIC, NO. 417, 74TH CONGRESS), PROVIDING FOR RETIREMENT AND RETIREMENT ANNUITIES OF CIVILIAN MEMBERS OF THE TEACHING STAFF AT THE U.S. NAVAL ACADEMY, THE QUESTION HAS ARISEN AS TO WHETHER THE ALLOTMENT FROM HIS PAY WHICH HE IS REQUIRED TO REGISTER IN AN AMOUNT ,EQUIVALENT TO 10 PERCENTUM OF HIS MONTHLY BASIC SALARY" SHOULD BE DEDUCTED FROM HIS TOTAL COMPENSATION OF $7,440 PER ANNUM (INCLUDING THE REASONABLE VALUE--- $1,440--- OF THE PUBLIC QUARTERS ASSIGNED HIM), OR WHETHER SUCH DEDUCTION SHOULD BE BASED ONLY ON THE ACTUAL CASH PAID HIM AT THE RATE OF $6,000 PER ANNUM.

THE TERM "MONTHLY BASIC SALARY" AS USED IN THE CITED ACT OF JANUARY 16, 1936, HAS BEEN INTERPRETED IN REGULATIONS ISSUED BY THE ACTING SECRETARY OF THE NAVY, MARCH 14, 1936, PURSUANT TO SECTION 6 OF SAID ACT,"TO MEAN ACTUAL CURRENT MONTHLY PAY," THAT IS, THE AMOUNT OF CASH ACTUALLY RECEIVED MONTHLY BY EACH CIVILIAN MEMBER OF THE TEACHING STAFF AT THE NAVAL ACADEMY. UNDER THIS INTERPRETATION THE 10 PERCENT DEDUCTION TO BE MADE FROM THE "MONTHLY BASIC SALARY" OF PROFESSOR ALDEN WOULD BE BASED ON THE ACTUAL AMOUNT OF CASH PAID HIM EACH MONTH AS COMPENSATION FOR HIS SERVICES, WHICH WOULD AMOUNT TO $50 (10 PERCENT OF $500).

ATTENTION IS INVITED TO THE FACT THAT SHOULD THE WORDS "MONTHLY BASIC SALARY" AS USED IN THE ACT OF JANUARY 16, 1936, BE OTHERWISE INTERPRETED AS INCLUDING THE REASONABLE VALUE OF THE QUARTERS FURNISHED PROFESSOR ALDEN, IT WILL BE NECESSARY FOR THE GOVERNMENT TO CREDIT THE MONTHLY PAY ACCOUNTS OF PROFESSOR ALDEN, FROM SUCH APPROPRIATIONS AS HEREAFTER MAY BE MADE AVAILABLE FOR THAT PURPOSE, WITH AN AMOUNT EQUIVALENT TO 5 PERCENTUM OF HIS TOTAL MONTHLY COMPENSATION, INCLUDING CASH PAID IN ADDITION TO THE REASONABLE VALUE OF QUARTERS FURNISHED, INSTEAD OF ONLY 5 PERCENTUM OF THE AMOUNT OF CASH ACTUALLY PAID EACH MONTH.

YOUR DECISION IS REQUESTED AS TO WHETHER THE 10 PERCENT ALLOTMENT WHICH IS REQUIRED TO BE DEDUCTED FROM THE "MONTHLY BASIC SALARY" OF PROFESSOR ALDEN SHOULD BE BASED ON HIS TOTAL COMPENSATION OF $7,440 PER ANNUM, OR ONLY ON THE ACTUAL CASH PAID HIM AS COMPENSATION FOR HIS SERVICES AT THE RATE OF $6,000 PER ANNUM.

SECTIONS 1 AND 2 OF THE ACT OF JANUARY 16, 1936, 49 STAT. 1092, PROVIDE:

THAT CIVILIAN MEMBERS OF THE TEACHING STAFFS OF THE UNITED STATES NAVAL ACADEMY AND POSTGRADUATE SCHOOL, WHOSE EMPLOYMENT COMMENCES FROM AND AFTER THE DATE OF APPROVAL OF THIS ACT, SHALL, AS A PART OF THEIR CONTRACTS OF EMPLOYMENT, BE REQUIRED TO CARRY, DURING SUCH EMPLOYMENT, A DEFERRED ANNUITY POLICY, HAVING NO CASH SURRENDER OR LOAN PROVISION, FROM A JOINT- STOCK LIFE INSURANCE CORPORATION, INCORPORATED UNDER THE LAWS OF ANY STATE OF THE UNITED STATES, WHICH HAS A CHARTER RESTRICTION THAT ITS BUSINESS MUST BE CONDUCTED WITHOUT PROFIT TO ITS STOCKHOLDERS.

SEC. 2. TOWARD THE PURCHASE OF SAID DEFERRED ANNUITY, EACH MEMBER OF SUCH TEACHING STAFFS SHALL BE REQUIRED TO REGISTER A MONTHLY ALLOTMENT THROUGH THE NAVY ALLOTMENT OFFICE, NAVY DEPARTMENT, WASHINGTON, DISTRICT OF COLUMBIA, EQUIVALENT IN AMOUNT TO 10 PERCENTUM OF HIS MONTHLY BASIC SALARY: PROVIDED, THAT FOR EACH MONTH SUCH ALLOTMENT IS REGISTERED, THE PAY ACCOUNTS OF SUCH MEMBER SHALL BE CREDITED MONTHLY FROM SUCH APPROPRIATIONS AS MAY BE MADE FOR THIS PURPOSE WITH AN ADDITIONAL SUM EQUIVALENT TO 5 PERCENTUM OF HIS MONTHLY BASIC SALARY.

IT APPEARS FROM YOUR STATEMENT RELATIVE TO THE CONTRACT OF EMPLOYMENT OF PROFESSOR C. S. ALDEN THAT HIS COMPENSATION CONSISTS OF SALARY OF $6,000 PER ANNUM ($500 PER MONTH) AND THE RIGHT TO OCCUPY CERTAIN GOVERNMENT QUARTERS, THE REASONABLE RENTAL VALUE OF WHICH IS $1,440 PER ANNUM. UNDER THE TERMS OF THE ACT OF JANUARY 16, 1936, THE MONTHLY ALLOTMENT REQUIRED TO BE REGISTERED BY A MEMBER OF THE TEACHING STAFF OF THE NAVAL ACADEMY TOWARD THE PURCHASE OF THE ANNUITY POLICY IS ,EQUIVALENT IN AMOUNT TO 10 PERCENTUM OF HIS MONTHLY BASIC SALARY," IN WHICH EVENT "THE PAY ACCOUNTS OF SUCH MEMBER SHALL BE CREDITED MONTHLY FROM SUCH APPROPRIATIONS AS MAY BE MADE FOR THIS PURPOSE WITH AN ADDITIONAL SUM EQUIVALENT TO 5 PERCENTUM OF HIS MONTHLY BASIC SALARY.' IN OTHER WORDS, UNDER THE TERMS OF THE ACT THE GOVERNMENT INCREASES THE BASIC SALARY OF THE MEMBER BY 5 PERCENT, PROVIDED HE REGISTERS AN ALLOTMENT OF 10 PERCENT OF HIS BASE SALARY FOR THE PURPOSE OF PURCHASING SUCH ANNUITY.

THE TERM "MONTHLY BASIC SALARY," AS USED IN THIS STATUTE CONTEMPLATES THE MEMBER'S REGULAR OR PERMANENT SALARY IN CONTRAST WITH TEMPORARY ADDITIONAL COMPENSATION OR ALLOWANCES FOR SPECIAL DUTY. ACCORDINGLY, THE REASONABLE RENTAL VALUE OF THE QUARTERS OCCUPIED BY PROFESSOR ALDEN IS PART OF HIS REGULAR BASIC SALARY OR COMPENSATION WITHIN THE ACT, AND HIS ANNUAL BASIC SALARY IS $7,440, OR $620 PER MONTH (8 COMP. GEN. 628).

YOU ARE ADVISED THAT THE ALLOTMENT OF 10 PERCENT OF HIS MONTHLY BASIC SALARY REQUIRED BY THE ACT OF JANUARY 16, 1936, TO BE REGISTERED BY PROFESSOR ALDEN IN PAYMENT OF THE ANNUITY POLICY REQUIRED TO BE CARRIED BY HIM UNDER THE ACT IS 10 PERCENT OF $620, OR $62 PER MONTH; AND THE SUM TO BE ADDED TO HIS PAY, CONTINGENT ON HIS REGISTERING SUCH ALLOTMENT, IS 5 PERCENT OF $620, OR $31 PER MONTH.