B-171460, AUG 13, 1971

B-171460: Aug 13, 1971

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GEN. 824 INCONSISTENT WITH THE PRESENT DECISION IS TO BE DISREGARDED. SECRETARY: FURTHER REFERENCE IS MADE TO LETTER FROM THE ASSISTANT SECRETARY OF DEFENSE (COMPTROLLER) DATED DECEMBER 2. RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN ELECTIONS ARE PERMISSIBLE UNDER THE LAST SENTENCE OF 10 U.S.C. 1431(C) BASED UPON SIX ENUMERATED CHANGES IN THE SERVICEMAN'S MARITAL OR FAMILY DEPENDENCY STATUS. THE QUESTIONS AND A DISCUSSION THEREOF ARE CONTAINED IN DEPARTMENT OF DEFENSE MILITARY PAY AND ALLOWANCE COMMITTEE ACTION NO. 445. THE RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN IS AN ANNUITY PROGRAM UNDER WHICH RETIRED SERVICEMEN MAY PROVIDE AN ANNUITY FOR THEIR SURVIVING SPOUSES AND DEPENDENT CHILDREN.

B-171460, AUG 13, 1971

MILITARY PERSONNEL - RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN - CHANGE IN OPTIONS CONCERNING POSSIBLE CHANGES IN, AND REVOCATIONS OF, ANNUITY OPTIONS THAT CAN BE MADE BY SERVICE MEMBERS UNDER RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN, 10 U.S.C. 1431(C), AS AMENDED AND AS INTERPRETED BY DECISION OF THE COMP. GEN., B-169528, JUNE 1, 1970. DECISION LISTS, WITH REFERENCE TO THE OPTION THAT SERVICEMAN PREVIOUSLY ELECTED, POSSIBLE CHANGES IN HIS ANNUITY UNDER 10 U.S.C. 1431(C) IN TEN GIVEN EXAMPLES WHICH SHOW SPECIFIC ACQUISITION OF LOSS OF A WIFE OR CHILD AND THE COMPOSITION OF THE FAMILY GROUP AFTER SUCH ACQUISITION OR LOSS. ANYTHING IN B-169528, JUNE 1, 1970, 49 COMP. GEN. 824 INCONSISTENT WITH THE PRESENT DECISION IS TO BE DISREGARDED.

TO MR. SECRETARY:

FURTHER REFERENCE IS MADE TO LETTER FROM THE ASSISTANT SECRETARY OF DEFENSE (COMPTROLLER) DATED DECEMBER 2, 1970, REQUESTING A DECISION AS TO WHICH CHANGES IN, AND REVOCATIONS OF, RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN ELECTIONS ARE PERMISSIBLE UNDER THE LAST SENTENCE OF 10 U.S.C. 1431(C) BASED UPON SIX ENUMERATED CHANGES IN THE SERVICEMAN'S MARITAL OR FAMILY DEPENDENCY STATUS. THE QUESTIONS AND A DISCUSSION THEREOF ARE CONTAINED IN DEPARTMENT OF DEFENSE MILITARY PAY AND ALLOWANCE COMMITTEE ACTION NO. 445.

THE RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN IS AN ANNUITY PROGRAM UNDER WHICH RETIRED SERVICEMEN MAY PROVIDE AN ANNUITY FOR THEIR SURVIVING SPOUSES AND DEPENDENT CHILDREN. THE LAW CONTEMPLATES THAT UNDER THAT PROGRAM THE ANNUITIES PAYABLE TO THE RETIRED SERVICEMEN'S SURVIVORS ARE FINANCED WHOLLY FROM DEDUCTIONS MADE FROM THE RETIRED PAY OF PARTICIPATING RETIRED MEMBERS OF THE UNIFORMED SERVICES.

THE LAW PRESCRIBES THE ANNUITIES WHICH MAY BE ELECTED AND THE TIME WHEN SUCH ELECTIONS MAY BE MADE, CHANGED, OR REVOKED. PRIOR TO THE ENACTMENT OF PUBLIC LAW 90-485, APPROVED AUGUST 13, 1968, 82 STAT. 751 (AMENDING, GENERALLY, 10 U.S.C., CHAPTER 73), THE INITIAL ELECTION OF AN ANNUITY HAD TO BE MADE PRIOR TO THE TIME THE MEMBER COMPLETED 18 YEARS OF SERVICE AND ANY CHANGE OR MODIFICATION OF ANY ELECTION HAD TO BE MADE AT LEAST 3 YEARS PRIOR TO THE MEMBER'S RETIREMENT.

PUBLIC LAW 90-485 AMENDED THE LAW (10 U.S.C. 1434) TO PROVIDE THAT THE MONTHLY ANNUITY WHICH MAY BE ELECTED SHALL BE THE AMOUNT PRESCRIBED BY THE ELECTOR AT THE TIME OF THE ELECTION, BUT NOT LESS THAN 12-1/2 PERCENT OR MORE THAN 50 PERCENT OF HIS RETIRED OR RETAINER PAY (AND IN NO CASE LESS THAN $25), AND THAT HE MAY MAKE THE ANNUITY PAYABLE -

"(1) TO, OR ON BEHALF OF, THE SURVIVING SPOUSE, ENDING WHEN THE SPOUSE DIES OR REMARRIES;

"(2) IN EQUAL SHARES TO, OR ON BEHALF OF, THE SURVIVING CHILDREN ELIGIBLE FOR THE ANNUITY AT THE TIME EACH PAYMENT IS DUE, ENDING WHEN THERE IS NO SURVIVING ELIGIBLE CHILD; OR

"(3) TO, OR ON BEHALF OF, THE SURVIVING SPOUSE, AND AFTER THE DEATH OR REMARRIAGE OF THAT SPOUSE, IN EQUAL SHARES TO, OR ON BEHALF OF, THE SURVIVING ELIGIBLE CHILDREN, ENDING WHEN THERE IS NO SURVIVING ELIGIBLE CHILD."

THE PURPOSE OF PUBLIC LAW 90-485 WAS TO INCREASE THE FLEXIBILITY OF THE PLAN BY (1) MOVING THE PREELECTION PERIOD UP TO THE 19TH YEAR OF SERVICE AND ALLOWING AN IMMEDIATELY EFFECTIVE CHANGE OR REVOCATION OF THE ORIGINAL ELECTION IF MADE PRIOR TO COMPLETION OF THE 19TH YEAR OF SERVICE, (2) REDUCING FROM 3 TO 2 YEARS THE DELAY IN THE EFFECTIVE DATE OF A SUBSEQUENT ELECTION, MODIFICATION, OR REVOCATION OF AN ELECTION, AND (3) ALLOWING A TIMELY CHANGE OR REVOCATION OF ELECTION PRIOR TO THE FIRST DAY FOR WHICH RETIRED OR RETAINER PAY IS GRANTED, PROVIDED THE CHANGE DOES NOT INCREASE THE AMOUNT OF THE ANNUITY ELECTED, "TO REFLECT A CHANGE IN THE MARITAL OR DEPENDENCY STATUS OF THE MEMBER OR HIS FAMILY THAT IS CAUSED BY DEATH, DIVORCE, ANNULMENT, REMARRIAGE, OR ACQUISITION OF A CHILD, IF SUCH CHANGE OR REVOCATION OF ELECTION IS MADE WITHIN TWO YEARS OF SUCH CHANGE IN MARITAL OR DEPENDENCY STATUS." (WORDS IN QUOTATION MARKS ARE FROM LAST SENTENCE IN U.S.C. 1431(C).)

IN ITS REPORT ON THE BILL WHICH BECAME PUBLIC LAW 90-485 (H. REPT. NO. 951, 90TH CONG., 1ST SESS., PAGE 7), THE HOUSE COMMITTEE ON ARMED SERVICES STATED:

"4. THE BILL AS REPORTED WILL ALSO PERMIT REVOCATIONS OR MODIFICATION OF AN ELECTION WITHIN THE PREELECTION PERIOD (2 YEARS PRECEDING RETIREMENT UNDER THIS BILL). THUS, SUBSEQUENT TO THE TIME A SERVICE MEMBER MAKES AN ELECTION AND PRIOR TO HIS ACTUAL RETIREMENT, HE MAY REVOKE OR MODIFY HIS ELECTION TO ADJUST TO A CHANGE IN HIS FAMILY OR BENEFICIARY SITUATION. FOR EXAMPLE, AS PRESENTLY CONSTITUTED, WITHIN THE PREELECTION PERIOD, WITH OPTION 1 (WIFE ONLY) SHOULD THE WIFE DIE OR BE DIVORCED, THE CHILDREN OF THE MARRIAGE MAY NOT RECEIVE AN ANNUITY UNLESS THE ELECTION OPTION 2 WAS ALSO IN EFFECT. SHOULD THE MEMBER WITH OPTION 2 (CHILDREN ONLY) REMARRY, HE CAN NOT NOW MODIFY HIS SURVIVOR PROTECTION PLAN TO PROVIDE FOR HIS NEW SPOUSE, DESPITE THE FACT THAT HE HAD NOT AT THIS POINT IN TIME ACTUALLY RETIRED. THE NEED TO LIBERALIZE THIS ASPECT OF THE PREELECTION RULE HAS LONG BEEN RECOMMENDED BY PARTICIPANTS AND IS ONE OF THE CHIEF REASONS WHY MANY SERVICE MEMBERS HAVE HERETOFORE DECLINED PARTICIPATION IN THE PROGRAM. THE CHANGE IS CONCURRED IN BY THE BOARD OF ACTUARIES."

THE COMMITTEE ACTION IN EFFECT ASKS, WITH RESPECT TO EACH OF THE THREE ANNUITY ELECTION OPTIONS SET FORTH IN THE STATUTE, WHETHER ELECTIONS, CHANGES IN ELECTIONS, OR REVOCATIONS OF ELECTIONS ARE AUTHORIZED UNDER THE LAST SENTENCE OF 10 U.S.C. 1431(C), INCIDENT TO (1) LOSS OF A WIFE, (2) ACQUISITION OF A WIFE, (3) ACQUISITION OF FIRST CHILD, (4) ACQUISITION OF AN ADDITIONAL CHILD, (5) LOSS OF ONLY CHILD AND (6) LOSS OF CHILD (OTHER CHILD BENEFICIARY) AND, IF SO, WHAT ELECTIONS, CHANGES IN ELECTIONS OR REVOCATIONS OF ELECTIONS ARE AUTHORIZED. THE COMMITTEE ACTION STATES THAT THE QUESTIONS ARE PROMPTED BY OUR DECISION OF JUNE 1, 1970, B-169528, WHICH INCLUDED THE FOLLOWING DISCUSSION:

"IT APPEARS THAT THE CONGRESS DID NOT INTEND THAT SECTION 1431(C) SHOULD PROVIDE A MEANS OF RELEASING A MEMBER FROM THE COMMITMENT OF A PRIOR ELECTION SIMPLY ON THE OCCURRENCE OF A CHANGE IN THE MARITAL OR DEPENDENCY STATUS OF THE ELECTOR OR HIS FAMILY CAUSED BY ONE OR MORE OF THE LISTED FACTORS, BUT RATHER, THAT SUCH SECTION WAS DESIGNED TO ALLOW HIM TO MAKE A CHANGE OR REVOCATION WHEN THE CHANGE IN HIS FAMILY'S STATUS RENDERS HIS PRIOR ELECTION INAPPROPRIATE.

"CERTAIN CHANGES IN MARITAL OR DEPENDENCY STATUS DO NOT WARRANT A CHANGE IN ELECTION. FOR EXAMPLE, A MEMBER WITH OPTION 3 (FAMILY OPTION) HAS A WIFE AND THREE CHILDREN AND ONE OF THE CHILDREN DIES. IF THE SECTION WERE INTERPRETED IN SUCH A MANNER AS TO PERMIT A CHANGE OR REVOCATION BECAUSE OF THE DEATH OF HIS CHILD, WE THINK THIS WOULD BE CONTRARY TO THE INTENT OF THE CONGRESS. THAT INTENT IS EXPRESSED BY THE USE OF THE WORDS 'TO REFLECT.' IN OUR VIEW THOSE WORDS REQUIRE A READING OF SECTION 1431(C) SO AS TO PERMIT A CHANGE OR REVOCATION INDICATIVE OF OR BEARING A CLOSE RELATIONSHIP TO THE ACTUAL CHANGE IN THE MARITAL OR DEPENDENCY STATUS OF THE ELECTOR OR HIS FAMILY."

THE PRINCIPAL QUESTIONS WHICH WE BELIEVE TO BE INVOLVED ARE INDICATED AND ANSWERED BELOW UNDER HEADINGS NUMBERED 1 TO 10, INCLUSIVE. EACH OF THESE HEADINGS SHOWS ACQUISITION OR LOSS OF A WIFE OR CHILD AND THE COMPOSITION OF THE FAMILY GROUP AFTER SUCH LOSS OR ACQUISITION. WE REALIZE THAT THESE ANSWERS MAY NOT COVER ALL CASES THAT COULD ARISE BUT WE THINK THAT THEY WILL COVER MOST CASES THAT ARE LIKELY TO ARISE. THE SOLUTIONS INDICATED ARE BASED UPON OUR UNDERSTANDING THAT THE ONLY OPTION CHANGES OR REVOCATIONS AUTHORIZED BY THE ABOVE-QUOTED PROVISIONS OF SECTION 1431(C), INCIDENT TO A CHANGE IN MARITAL OR FAMILY DEPENDENCY STATUS, ARE THOSE WHICH REALISTICALLY REFLECT THE CHANGE IN SUCH STATUS. IN OTHER WORDS, IT IS OUR VIEW THAT AN APPROPRIATE ELECTION OR REVOCATION UNDER THE LAST SENTENCE OF 10 U.S.C. 1431(C) WOULD BE ONE WHICH MAY BE CONSIDERED A LOGICAL AND REASONABLE ACTION FOLLOWING AND BASED UPON THE PARTICULAR OCCURRENCE WHICH CHANGES THE MARITAL OR DEPENDENCY STATUS OF THE MEMBER OR HIS FAMILY. OUR REASONS FOR THE DETERMINATIONS UNDER EACH HEADING APPEAR IMMEDIATELY AFTER THE ANSWERS TO WHICH THEY RELATE. SINCE ALL ANSWERS INVOLVE THE INTERPRETATION AND APPLICATION OF THE LAST SENTENCE OF 10 U.S.C. 1431(C), THEY ARE, OF COURSE, SUBJECT TO THE PROVISION IN THAT SENTENCE THAT A CHANGE OF ELECTION MAY NOT INCREASE THE AMOUNT OF THE ANNUITY ELECTED.

1. LOSS OF WIFE WHERE MEMBER HAS A CHILD OR CHILDREN

IN A CASE WHERE THE MEMBER LOSES HIS WIFE BY DEATH, DIVORCE OR ANNULMENT AND, AT THAT TIME HE HAS A CHILD OR CHILDREN IN EXISTENCE AND HE -

PREVIOUSLY HAD ELECTED OPTION 1 -

HE MAY REVOKE OPTION 1 OR HE MAY ELECT OPTION 2 OR OPTION 3

PREVIOUSLY HAD ELECTED OPTION 2 -

HE MAY NOT REVOKE OPTION 2, ELECT OPTION 1 OR ELECT OPTION 3

PREVIOUSLY HAD ELECTED OPTION 3 -

HE MAY REVOKE OPTION 3 PROVIDED HE ELECTS OPTION 2

HE MAY NOT ELECT OPTION 1

WHERE THE MEMBER HAD ELECTED OPTION 1 ONLY AND HE SUFFERS THE LOSS OF HIS WIFE HE MAY REVOKE HIS OPTION 1 ELECTION, ALTHOUGH SUCH ACTION WOULD BE IMMATERIAL UNLESS HE SHOULD REMARRY BEFORE RETIREMENT, SINCE NO REDUCTION WOULD BE MADE IN HIS RETIRED PAY FOR A WIDOW'S ANNUITY IF HE HAS NO WIFE AT THE TIME OF HIS RETIREMENT. SEE SUBSECTION 301A OF THE REGULATIONS FOR THE RETIRED SERVICEMAN'S FAMILY PROTECTION PLAN (HEREINAFTER REFERRED TO AS REGULATIONS).

THE ABOVE-QUOTED STATEMENT IN HOUSE REPORT NO. 951 CLEARLY ESTABLISHES THAT IT WAS THE INTENTION OF CONGRESS THAT A MEMBER SHOULD BE ELIGIBLE TO ELECT AN ANNUITY FOR HIS CHILDREN UPON THE LOSS OF HIS WIFE AND THEREFORE A MEMBER WHO HAD ONLY AN OPTION 1 ELECTION IN EFFECT MAY ELECT OPTION 2 IF HE HAS ELIGIBLE CHILDREN UPON THE LOSS OF HIS WIFE.

WHILE IT MAY SEEM INAPPROPRIATE FOR A MEMBER, WHO HAD ELECTED OPTION 1 ONLY, TO ELECT OPTION 3 UPON THE LOSS OF HIS WIFE, A MEMBER MAY ELECT AN ANNUITY FOR A FUTURE WIFE (SEE SECTION 301A OF THE REGULATIONS), PAYMENT OF WHICH WOULD BE CONTINGENT UPON A SUBSEQUENT MARRIAGE. IF IN SUCH CIRCUMSTANCES THE MEMBER DOES IN FACT ELECT OPTION 3 BUT DOES NOT REMARRY, SUCH ELECTION IS IN EFFECT CONVERTED TO AN OPTION 2 ELECTION, SINCE SUBSECTION 401C OF THE REGULATIONS PROVIDES THAT, IF A MEMBER ELECTS OPTION 3 AND HAS NO WIFE ELIGIBLE FOR AN ANNUITY AT THE TIME OF HIS RETIREMENT, HE SHALL HAVE HIS COSTS COMPUTED AS THOUGH HE HAD ELECTED OPTION 2. ACCORDINGLY, AN OPTION 3 ELECTION IS PERMISSIBLE WHEN A MEMBER WHO HAS ELECTED AN OPTION 1 ANNUITY SUFFERS THE LOSS OF HIS WIFE.

THE MEMBER IS NOT REQUIRED TO REVOKE OPTION 1 UPON THE LOSS OF HIS WIFE AND, IF HE REMARRIES WITHOUT REVOKING IT, HIS WIDOW WOULD BE ENTITLED TO AN OPTION 1 ANNUITY. THERE IS NO BASIC DIFFERENCE BETWEEN AN OPTION 1 AND AN OPTION 3 ELECTION INSOFAR AS PAYMENT OF THE ANNUITY TO THE WIDOW IS CONCERNED (EXCEPT WHERE THE MEMBER ALLOCATES PART OF THE ANNUITY TO HIS CHILDREN BY A WIFE OTHER THAN HIS WIDOW PURSUANT TO SUBSECTION 201C OF THE REGULATIONS). THE ONLY DIFFERENCE BETWEEN AN OPTION 1 AND AN OPTION 3 ELECTION IS THAT UNDER AN OPTION 3 ELECTION THE CHILDREN ORDINARILY RECEIVE THE ANNUITY UPON THE TERMINATION OF THE WIDOW'S ANNUITY. ACCORDINGLY, AN OPTION 3 ELECTION IS PERMISSIBLE WHEN A MEMBER WITH CHILDREN WHO HAS ELECTED OPTION 1 SUFFERS THE LOSS OF HIS WIFE.

WHERE THE MEMBER PREVIOUSLY ELECTED OPTION 2, THE LOSS OF A WIFE PROVIDES NO BASIS FOR REVOKING AN OPTION 2 ELECTION OR FOR ELECTING OPTION 1 OR OPTION 3, SINCE NO RIGHT TO AN ANNUITY COULD HAVE ACCRUED TO THE WIFE UNDER OPTION 2 AND HER DEATH COULD THUS FURNISH NO BASIS FOR A CHANGE IN THAT OPTION.

WHERE THE MEMBER PREVIOUSLY HAD ELECTED OPTION 3, HE MAY REVOKE THAT OPTION UPON LOSS OF HIS WIFE PROVIDED HE ELECTS OPTION 2. WHERE THE MEMBER HAS ELECTED OPTION 3 AND HE HAS NO WIFE ELIGIBLE FOR AN ANNUITY WHEN HE RETIRES, THE REGULATIONS PROVIDE THAT THE REDUCTION FACTOR WITH RESPECT TO THE MEMBER'S COST CONTRIBUTION WILL BE COMPUTED AS THOUGH HE HAD ELECTED OPTION 2 AND NO REDUCTION IS MADE IN HIS RETIRED PAY ON ACCOUNT OF A WIFE. IN SUCH A CASE, REVOCATION OF OPTION 3 AND ELECTION OF OPTION 2 IS UNNECESSARY FOR THE REDUCTION FACTOR TO BE COMPUTED AND ANNUITY PAYMENTS TO BE MADE AS IF THE MEMBER HAD ORIGINALLY ELECTED OPTION 2 ONLY. HOWEVER, AN AFFIRMATIVE REVOCATION OF OPTION 3 AND AN AFFIRMATIVE ELECTION OF OPTION 2 WOULD EFFECT THE SAME RESULT AND WOULD BE SUPPORTED BY THE CHANGE IN MARITAL STATUS RESULTING FROM THE MEMBER'S LOSS OF HIS WIFE. SUCH CHANGE OF ELECTIONS IS THEREFORE AUTHORIZED. IT IS OUR OPINION THAT REVOCATION OF OPTION 3 IS AUTHORIZED ONLY IF OPTION 2 IS ELECTED. ELECTION OF OPTION 1 UPON THE LOSS OF A WIFE WOULD BE INAPPROPRIATE.

2. LOSS OF WIFE WHEN MEMBER HAS NO CHILD

IN A CASE WHERE THE MEMBER LOSES HIS WIFE BY DEATH, DIVORCE, OR ANNULMENT AND, AT THAT TIME, HE HAD NO CHILD IN EXISTENCE, AND HE -

PREVIOUSLY HAD ELECTED OPTION 1 -

HE MAY REVOKE OPTION 1

HE MAY NOT ELECT OPTION 2 OR ELECT OPTION 3

PREVIOUSLY HAD ELECTED OPTION 2 -

HE MAY NOT REVOKE OPTION 2, ELECT OPTION 1, OR ELECT OPTION 3

PREVIOUSLY HAD ELECTED OPTION 3 -

HE MAY REVOKE OPTION 3

HE MAY NOT ELECT OPTION 1 OR OPTION 2

WHERE THE MEMBER HAS NO CHILD, THE LOSS OF HIS WIFE WOULD NOT PROVIDE A BASIS FOR ELECTION OF OPTION 1, 2 OR 3, SINCE SUCH AN ELECTION WOULD NOT REFLECT THE CHANGE IN HIS MARITAL OR DEPENDENCY STATUS MADE BY THE LOSS OF HIS WIFE. SIMILARLY, REVOCATION OF OPTION 2 WOULD NOT REFLECT ANY RELEVANT CHANGE IN HIS MARITAL OR DEPENDENCY STATUS.

3. ACQUISITION OF WIFE BY REMARRIAGE WHEN MEMBER HAS CHILD OR CHILDREN

IN A CASE WHERE THE MEMBER ACQUIRES A WIFE BY REMARRIAGE AND, AT THAT TIME, HE HAS A CHILD OR CHILDREN IN EXISTENCE, AND HE - PREVIOUSLY HAD ELECTED OPTION 1 -

HE MAY ELECT OPTION 2 IN CONJUNCTION WITH OPTION 1 OR HE MAY ELECT OPTION 3

HE MAY NOT REVOKE OPTION 1 (EXCEPT WHEN HE ELECTS OPTION 3)

PREVIOUSLY HAD ELECTED OPTION 2 -

HE MAY ELECT A COMBINATION OF OPTION 1 AND OPTION 2 OR HE MAY ELECT OPTION 3 IN PLACE OF OPTION 2

HE MAY NOT REVOKE OPTION 2 EXCEPT WHEN HE ELECTS OPTION 3

PREVIOUSLY HAD ELECTED OPTION 3 -

HE MAY ELECT A COMBINATION OF OPTION 1 AND OPTION 2 HE MAY NOT REVOKE OPTION 3 (EXCEPT WHEN HE ELECTS SUCH COMBINATION OF OPTION 1 AND OPTION 2)

WHEN A MEMBER WITH CHILDREN REMARRIES, HIS FAMILY SITUATION IS MATERIALLY CHANGED AND FOR MANY REASONS HE MAY WANT TO PROVIDE AN ANNUITY FOR BOTH HIS WIFE AND HIS CHILDREN, PARTICULARLY SINCE THE RELATIONSHIP OF HIS NEW WIFE TO HIS EXISTING CHILDREN IS A RELATIONSHIP BY AFFINITY ONLY SO THAT UPON THE DEATH OF THE MEMBER THE WIFE MIGHT HAVE NO LEGAL LIABILITY FOR THE SUPPORT OF SUCH CHILDREN. SEE ERIE COUNTY BOARD OF SOCIAL WELFARE V SCHNEIDER, 163 NYS 2D 184 (1957). WHILE, UNDER THE REGULATIONS, THE MEMBER MAY ALLOCATE PART OF AN OPTION 3 ANNUITY TO HIS CHILDREN, HE CAN INSURE SUPPORT OF HIS CHILDREN BY MEANS OF AN OPTION 2 ANNUITY ALSO. THEREFORE HE MAY ELECT OPTION 2 IN CONJUNCTION WITH OPTION 1.

WHERE THE MEMBER WITH CHILDREN ACQUIRES A WIFE BY REMARRIAGE HE MAY NOT REVOKE HIS ELECTION OF OPTION 1 (UNLESS HE ELECTS OPTION 3 IN PLACE OF IT), SINCE SUCH ACTION WOULD NOT "REFLECT" THE CHANGED MARITAL OR DEPENDENCY STATUS RESULTING FROM HIS ACQUISITION OF A WIFE.

WHERE THE MEMBER WHO HAD ELECTED OPTION 2 FOR HIS CHILDREN REMARRIES, IT WOULD SEEM APPROPRIATE THAT HE PROVIDE FOR HIS WIFE AS WELL AS HIS CHILDREN BY ELECTING A COMBINATION OF OPTION 1 AND OPTION 2 OR BY ELECTING A COMBINATION OF OPTION 1 AND OPTION 2 OR BY ELECTING OPTION 3 IN PLACE OF OPTION 2. A MERE REVOCATION OF OPTION 2, WHICH WOULD TOTALLY DEPRIVE THE CHILDREN OF THEIR PREVIOUS DESIGNATION AND MAKE NO PROVISION FOR THE NEW WIFE, WOULD NOT SEEM TO BE A REASONABLE OR LOGICAL ACTION FOLLOWING AND BASED UPON THE REMARRIAGE. HOWEVER, SINCE AN ELECTION OF OPTION 3 AND SIMULTANEOUS REVOCATION OF OPTION 2 WOULD REFLECT THE REMARRIAGE AND WOULD PROVIDE, CONTINGENTLY, FOR THE CHILDREN, IT WOULD APPEAR THAT THE OPTION 3 ELECTION SHOULD BE OPEN TO THE MEMBER.

WHERE A MEMBER WITH CHILDREN AND WITH AN OPTION 3 ELECTION REMARRIES, HIS MERE ELECTION OF OPTION 1 IN PLACE OF OPTION 3 WOULD TERMINATE THE CONTINGENT PROSPECT OF THE CHILDREN TO RECEIVE AN ANNUITY WITHOUT GIVING THE NEW WIFE ANY GREATER PROSPECT OF AN ANNUITY THAN SHE WOULD HAVE HAD UNDER THE OPTION 3 ELECTION. THIS WOULD BE INAPPROPRIATE. HOWEVER, AN ELECTION OF A COMBINATION OF OPTIONS 1 AND 2 IN PLACE OF OPTION 3 WOULD GIVE BOTH THE NEW WIFE AND THE CHILDREN THE PROSPECT OF RECEIVING ANNUITIES AND WOULD BE APPROPRIATE. AS INDICATED, UNDER THE REGULATIONS THE MEMBER WITH AN OPTION 3 ELECTION COULD ACCOMPLISH A SIMILAR RESULT BY ALLOCATING A PORTION OF THE ANNUITY FOR HIS CHILDREN BY A SPOUSE OTHER THAN HIS WIDOW, TO BE PAID TO THEM CONCURRENTLY WITH THE WIDOW'S ANNUITY.

4. ACQUISITION OF WIFE BY REMARRIAGE WHEN MEMBER HAS NO CHILD

IN A CASE WHERE A MEMBER ACQUIRES A WIFE BY REMARRIAGE AND AT THAT TIME HE HAS NO CHILD IN EXISTENCE AND HE -

PREVIOUSLY HAD ELECTED OPTION 1 -

HE MAY NOT REVOKE OPTION 1, ELECT OPTION 2 OR ELECT OPTION 3

PREVIOUSLY HAD ELECTED OPTION 2 -

HE MAY REVOKE OPTION 2, ELECT OPTION 1 OR ELECT OPTION 3

PREVIOUSLY HAD ELECTED OPTION 3 -

HE MAY NOT REVOKE OPTION 3, ELECT OPTION 1 OR ELECT OPTION 2

WHERE A MEMBER WITHOUT A CHILD HAD ELECTED OPTION 1, NEITHER THE REVOCATION OF OPTION 1 NOR THE ELECTION OF OPTION 2 WOULD BE RELATED TO THE ACQUISITION OF A WIFE. WHILE AN ELECTION OF OPTION 3 WOULD HAVE THE SAME SIGNIFICANCE FOR THE WIFE, SHE IS ALREADY COVERED BY THE PREVIOUSLY ELECTED OPTION 1 AND THERE WOULD BE NO PURPOSE TO BE SERVED BY PERMITTING THE MEMBER INCIDENT TO THE REMARRIAGE TO PROVIDE A CONTINGENT RIGHT FOR CHILDREN NOT IN EXISTENCE.

IF THE MEMBER HAD ELECTED OPTION 2, REVOCATION OF THAT OPTION AND ELECTION OF OPTION 1 OR 3 IS AUTHORIZED. WHERE THE MEMBER HAD ELECTED OPTION 3, ELECTION OF OPTION 2 WOULD BE UNRELATED TO HIS REMARRIAGE AND A CHANGE TO OPTION 1 WOULD BE UNNECESSARY SINCE OPTION 3 WOULD ENTITLE HIS WIFE TO THE SAME ANNUITY AS SHE WOULD RECEIVE UNDER OPTION 1.

5. ACQUISITION OF FIRST CHILD

IN A CASE WHERE THE MEMBER HAS A WIFE AND ACQUIRES AN ONLY LEGITIMATE OR ADOPTED CHILD AND HE -

PREVIOUSLY HAD ELECTED OPTION 1 -

HE MAY ELECT OPTION 2 IN CONJUNCTION WITH OPTION 1, OR REVOKE OPTION 1 IF HE ELECTS OPTION 3

HE MAY NOT REVOKE OPTION 1 UNLESS HE ELECTS OPTION 3

PREVIOUSLY HAD ELECTED OPTION 2 -

HE MAY NOT ELECT OPTION 1, REVOKE OPTION 2, OR ELECT OPTION 3

PREVIOUSLY HAD ELECTED OPTION 3 -

HE MAY ELECT A COMBINATION OF OPTION 1 AND OPTION 2

HE MAY NOT REVOKE OPTION 3 (EXCEPT WHEN HE ELECTS SUCH COMBINATION)

REVOCATION OF OPTION 1 IS NOT APPROPRIATE WHERE THE MEMBER HAS A WIFE AND ACQUIRES AN ONLY CHILD, BUT HE MAY ELECT OPTION 2 AND ADJUST OPTION 1 ACCORDINGLY. REVOCATION OF OPTION 1 WITH ACCOMPANYING ELECTION OF OPTION 3 WOULD BE PROPER SINCE BOTH THE WIFE AND CHILD WOULD BE COVERED BY THE NEW ELECTION. IF OPTION 2 HAD BEEN PREVIOUSLY ELECTED, REVOCATION OF OPTION 2 OR ELECTION OF OPTION 1 OR OPTION 3 WOULD NOT REFLECT THE ACQUISITION OF THE CHILD AND, HENCE, WOULD NOT BE APPROPRIATE. THE ELECTION OF OPTION 2 TO ENABLE HIS NEWLY ACQUIRED CHILD TO RECEIVE AN ANNUITY CONCURRENTLY WITH HIS WIFE (OPTION 1), RATHER THAN ONLY UPON HER DEATH OR REMARRIAGE CONTEMPLATED BY A PREVIOUS OPTION 3 ELECTION, WOULD REFLECT A CHANGE IN DEPENDENCY STATUS SO AS TO AUTHORIZE REVOCATION OF OPTION 3.

6. ACQUISITION OF ADDITIONAL CHILD

IN A CASE WHERE A MEMBER HAS A WIFE AND ONE OR MORE CHILDREN AND ACQUIRES AN ADDITIONAL LEGITIMATE OR ADOPTED CHILD AND HE -

PREVIOUSLY HAD ELECTED OPTION 1 -

HE MAY ELECT OPTION 2 IN CONJUNCTION WITH OPTION 1 OR ELECT OPTION 3

HE MAY NOT REVOKE OPTION 1 EXCEPT WHEN HE ELECTS OPTION 3

PREVIOUSLY HAD ELECTED OPTION 2 -

HE MAY NOT ELECT OPTION 1 OR 3 OR REVOKE OPTION 2

PREVIOUSLY HAD ELECTED OPTION 3 -

HE MAY ELECT A COMBINATION OF OPTION 1 AND OPTION 2

HE MAY NOT REVOKE OPTION 3 EXCEPT WHEN HE ELECTS SUCH COMBINATION

WHERE A MEMBER HAD PREVIOUSLY ELECTED OPTION 1, THE ACQUISITION OF AN ADDITIONAL CHILD PROVIDES NO BASIS FOR REVOCATION OF OPTION 1, BUT DOES EFFECT SUCH A CHANGE IN DEPENDENCY STATUS AS TO AUTHORIZE ELECTION OF OPTION 2 WITH AN APPROPRIATE ADJUSTMENT OF OPTION 1, OR AN OPTION 3 ELECTION IN PLACE OF OPTION 1. THE ACQUISITION OF AN ADDITIONAL CHILD EFFECTS NO CHANGE IN THE MEMBER'S MARITAL STATUS, AND HENCE HE CAN NOT ELIMINATE AN ANNUITY ELECTION FOR HIS WIFE ON THAT ACCOUNT, OR INITIATE ONE FOR HER UPON THE ACQUISITION OF AN ADDITIONAL CHILD.

7. LOSS OF ONLY CHILD BY MEMBER WITH WIFE

IN A CASE WHERE THE MEMBER HAS A WIFE AND ONE CHILD AND THE CHILD DIES AND HE -

PREVIOUSLY HAD ELECTED OPTION 1 -

HE MAY NOT REVOKE OPTION 1, OR ELECT OPTION 2 OR OPTION 3

PREVIOUSLY HAD ELECTED OPTION 2 -

HE MAY ELECT OPTION 1 OR OPTION 3 OR REVOKE OPTION 2

PREVIOUSLY HAD ELECTED OPTION 3 -

HE MAY ELECT OPTION 1

HE MAY NOT REVOKE OPTION 3 UNLESS HE ELECTS OPTION 1, AND HE MAY NOT ELECT OPTION 2

IN VIEW OF DISCUSSIONS ABOVE NO EXPLANATIONS OF THE ABOVE CONCLUSIONS ARE DEEMED TO BE NECESSARY.

8. LOSS OF ONLY CHILD BY MEMBER WITHOUT WIFE

IN A CASE WHERE THE MEMBER HAS ONE CHILD BUT NO WIFE AND THE CHILD DIES AND HE -

PREVIOUSLY HAD ELECTED OPTION 1 -

HE MAY NOT REVOKE OPTION 1, OR ELECT OPTION 2 OR OPTION 3

PREVIOUSLY HAD ELECTED OPTION 2 -

HE MAY REVOKE OPTION 2

HE MAY NOT ELECT OPTION 1 OR OPTION 3

PREVIOUSLY HAD ELECTED OPTION 3 -

HE MAY NOT REVOKE OPTION 3 OR ELECT OPTION 1 OR OPTION 2

IN VIEW OF THE PREVIOUS DISCUSSION NO EXPLANATION OF THESE CONCLUSIONS IS DEEMED TO BE NECESSARY.

9. LOSS OF CHILD BY MEMBER WHO HAS WIFE AND OTHER CHILD OR CHILDREN

IN A CASE WHERE THE MEMBER HAS A WIFE AND OTHER CHILDREN AND LOSES ONE CHILD BY DEATH AND HE -

PREVIOUSLY HAD ELECTED OPTION 1 -

HE MAY NOT REVOKE OPTION 1 OR ELECT OPTION 2 OR 3

PREVIOUSLY HAD ELECTED OPTION 2 -

HE MAY NOT REVOKE OPTION 2 OR ELECT OPTION 1 OR OPTION 3

PREVIOUSLY HAD ELECTED OPTION 3 -

HE MAY NOT REVOKE OPTION 3 OR ELECT OPTION 1 OR OPTION 2

IN VIEW OF THE ABOVE DISCUSSION NO EXPLANATION OF THE ABOVE CONCLUSIONS IS DEEMED NECESSARY.

10. LOSS OF CHILD BY MEMBER WHO HAS NO WIFE BUT HAS OTHER CHILDREN

IN A CASE WHERE A MEMBER HAS NO WIFE BUT HAS OTHER CHILDREN AND LOSES A CHILD BY DEATH AND HE -

PREVIOUSLY HAD ELECTED OPTION 1 -

HE MAY NOT REVOKE OPTION 1 OR ELECT OPTION 2 OR OPTION 3

PREVIOUSLY HAD ELECTED OPTION 2 -

HE MAY NOT ELECT OPTION 1 OR OPTION 3 OR REVOKE OPTION 2

PREVIOUSLY HAD ELECTED OPTION 3 -

HE MAY NOT ELECT OPTION 1 OR OPTION 2 OR REVOKE OPTION 3

IN VIEW OF THE FOREGOING DISCUSSION NO EXPLANATION OF THE ABOVE CONCLUSIONS IS DEEMED NECESSARY.

ANYTHING WHICH WAS SAID IN B-169528, JUNE 1, 1970, 49 COMP. GEN. 824, THAT IS INCONSISTENT WITH THE CONCLUSIONS REACHED HEREIN MAY BE DISREGARDED.