B-163440, JUN. 17, 1968

B-163440: Jun 17, 1968

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SCHUDT: REFERENCE IS MADE TO YOUR LETTER OF MAY 22. YOU SAY THAT YOU WERE PAID INTEREST THROUGH THE MONTH OF AUGUST 1967 ONLY. WHICH PROVIDES: "IN NO CASE WILL INTEREST ACCRUE FOR A PERIOD LONGER THAN 90 DAYS (COMPUTED ON A DAY FOR DAY BASIS OF ACTUAL ELAPSED TIME) AFTER THE MEMBER RETURNS TO THE US OR ITS POSSESSIONS. INTEREST WILL ACCRUE THROUGH THE LAST DAY OF THE PRECEDING MONTH. WILL ACCRUE ON AMOUNTS DEPOSITED UNDER THIS SECTION. THE MAXIMUM AMOUNT UPON WHICH INTEREST MAY BE PAID UNDER THIS ACT TO ANY MEMBER IS $10. YOU URGE THAT THE LEGISLATIVE HISTORY OF THE LAW SHOWS THAT THE DEPARTMENT OF DEFENSE LEGISLATIVE PLAN PROVIDED FOR INTEREST TO BE COMPUTED QUARTERLY DURING THE PERIOD A DEPOSITOR IS OVERSEAS AND FOR 90 DAYS AFTER HIS RETURN TO THE UNITED STATES.

B-163440, JUN. 17, 1968

TO COLONEL CHARLES W. SCHUDT:

REFERENCE IS MADE TO YOUR LETTER OF MAY 22, 1968, REQUESTING REVIEW OF GENERAL ACCOUNTING OFFICE SETTLEMENT DATED APRIL 11, 1968, WHICH DISALLOWED YOUR CLAIM FOR ADDITIONAL INTEREST BELIEVED TO BE DUE ON YOUR SAVINGS DEPOSIT UNDER THE UNIFORMED SERVICES SAVINGS DEPOSIT PROGRAM, 10 U.S.C. 1035, ESTABLISHED BY PUBLIC LAW 89-538, APPROVED AUGUST 14, 1966.

AT THE TIME OF YOUR RETURN TO THE UNITED STATES ON JUNE 30, 1967, YOU HAD ON DEPOSIT UNDER THE SAVINGS DEPOSIT PROGRAM THE SUM OF $7,970, REPAYMENT OF WHICH YOU REQUESTED ON OCTOBER 2, 1967. YOU SAY THAT YOU WERE PAID INTEREST THROUGH THE MONTH OF AUGUST 1967 ONLY, IN ACCORDANCE WITH THE PROVISIONS OF PARAGRAPH 70806B, DEPARTMENT OF DEFENSE MILITARY PAY AND ALLOWANCES ENTITLEMENTS MANUAL, WHICH PROVIDES:

"IN NO CASE WILL INTEREST ACCRUE FOR A PERIOD LONGER THAN 90 DAYS (COMPUTED ON A DAY FOR DAY BASIS OF ACTUAL ELAPSED TIME) AFTER THE MEMBER RETURNS TO THE US OR ITS POSSESSIONS. THE 90-DAY LIMITATION PERIOD BEGINS ON THE DAY OF THE MEMBER'S ARRIVAL IN THE US OR ITS POSSESSIONS. SHOULD THE 90-DAY LIMITATION PERIOD END ON ANY DAY OTHER THAN THE LAST DAY OF A MONTH, INTEREST WILL ACCRUE THROUGH THE LAST DAY OF THE PRECEDING MONTH. IF THE 90-DAY LIMITATION PERIOD ENDS ON THE LAST DAY OF A MONTH, PAY INTEREST FOR THAT MONTH.'

SUBSECTION (B) OF SECTION 1035 OF TITLE 10, U.S. CODE, PROVIDES THAT:

"/B) INTEREST AT A RATE PRESCRIBED BY THE PRESIDENT, NOT TO EXCEED 10 PER CENTUM A YEAR, WILL ACCRUE ON AMOUNTS DEPOSITED UNDER THIS SECTION. HOWEVER, THE MAXIMUM AMOUNT UPON WHICH INTEREST MAY BE PAID UNDER THIS ACT TO ANY MEMBER IS $10,000. INTEREST UNDER THIS SUBSECTION SHALL TERMINATE NINETY DAYS AFTER THE MEMBER'S RETURN TO THE UNITED STATES OR ITS POSSESSIONS.'

YOU SAY THAT YOU DO NOT TAKE ISSUE WITH THE STATEMENT IN THE SETTLEMENT TO THE EFFECT THAT CONGRESS CONTEMPLATED THAT ALL MATTERS NOT PROVIDED IN THE LAW OR DELEGATED TO THE PRESIDENT SHOULD BE PRESCRIBED IN THE JOINT REGULATIONS ISSUED BY THE SECRETARIES CONCERNED, BUT YOU URGE THAT REGULATIONS SO PRESCRIBED MAY NOT BE INCONSISTENT WITH THE PROVISIONS OF THE STATUTE AND THE INTENT OF THE CONGRESS IN ENACTING IT.

IT APPEARS THAT YOUR FUNDS REMAINED ON DEPOSIT MORE THAN 90 DAYS AFTER YOUR RETURN TO THE UNITED STATES BEFORE YOU REQUESTED REPAYMENT. YOU URGE THAT THE LEGISLATIVE HISTORY OF THE LAW SHOWS THAT THE DEPARTMENT OF DEFENSE LEGISLATIVE PLAN PROVIDED FOR INTEREST TO BE COMPUTED QUARTERLY DURING THE PERIOD A DEPOSITOR IS OVERSEAS AND FOR 90 DAYS AFTER HIS RETURN TO THE UNITED STATES; THAT INTEREST WOULD BE COMPUTED TO THE LAST DAY OF THE MONTH IN WHICH SETTLEMENT IS MADE, OR 90 DAYS AFTER RETURN, WHICHEVER IS EARLIER; AND THAT THE PURPOSE OF THE 90 DAYS' INTEREST AFTER RETURN TO THE UNITED STATES IS TO PROVIDE A GRACE PERIOD TO ENABLE THE SERVICEMAN TO REARRANGE HIS SAVINGS PLAN.

SINCE YOUR DEPOSITS REMAINED WITH THE GOVERNMENT FOR OVER 90 DAYS FOLLOWING YOUR RETURN FROM OVERSEAS, AND SINCE THE COMPLETION OF THIS PERIOD WAS EARLIER THAN THE LAST DAY OF THE MONTH IN WHICH SETTLEMENT WAS MADE, YOU CONCLUDE THAT THE ABOVE-QUOTED REGULATION HAS OPERATED TO DEPRIVE YOU OF A RIGHT TO WHICH YOU ARE ENTITLED UNDER THE LAW AND ACCORDINGLY YOU REASSERT YOUR CLAIM FOR THE ADDITIONAL INTEREST OF $69.33.

THE STATUTE PROVIDES THAT INTEREST ON DEPOSITS UNDER THE SERVICEMEN'S SAVINGS PROGRAM "SHALL TERMINATE NINETY DAYS AFTER THE MEMBER'S RETURN TO THE UNITED STATES OR ITS POSSESSIONS.' THAT IS THE MAXIMUM PERIOD AFTER RETURN TO THE UNITED STATES DURING WHICH INTEREST IS AUTHORIZED UNDER THE STATUTE. ON THE OTHER HAND, WE DO NOT VIEW THE STATUTE AS PROVIDING THAT INTEREST AUTOMATICALLY ACCRUES ON A DAY TO DAY BASIS FOR THE FULL 90 DAYS IN EVERY CASE WHERE A MEMBER RETURNS TO THE UNITED STATES AND DOES NOT WITHDRAW HIS DEPOSIT UNTIL AFTER THE 90TH DAY FOLLOWING HIS RETURN.

THE ACT CLEARLY PROVIDES THAT THE SAVINGS PROGRAM WILL BE ADMINISTERED UNDER REGULATIONS TO BE ISSUED BY THE SECRETARIES CONCERNED. UNDER THAT BROAD AUTHORIZATION REGULATIONS HAVE BEEN ISSUED AND, WHILE POSSIBLY THEY MIGHT HAVE INCLUDED SLIGHTLY MORE LIBERAL PROVISIONS WITH RESPECT TO PAYING INTEREST DURING THE 90-DAY PERIOD FOLLOWING RETURN TO THE UNITED STATES, WE DO NOT THINK THAT THE REGULATIONS AS ISSUED ARE UNAUTHORIZED UNDER THE LAW OR INCONSISTENT WITH IT.

ACCORDINGLY, IT IS OUR VIEW THAT THE ABOVE-QUOTED REGULATIONS ARE VALID AND, SINCE YOU HAVE BEEN PAID INTEREST IN ACCORDANCE WITH THOSE REGULATIONS, THERE IS NO AUTHORITY FOR PAYMENT OF THE ADDITIONAL INTEREST YOU CLAIM.