B-179191, MAR 25, 1974

B-179191: Mar 25, 1974

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D.C. 20330 FURTHER REFERENCE IS MADE TO YOUR LETTER DATED JULY 3. YOU SAY THAT GENERAL BURCHINAL WAS RETIRED ON FEBRUARY 28. HE WAS ENTITLED TO MONTHLY RETIRED PAY IN THE AMOUNT OF 75 PERCENT OF THE MONTHLY BASIC PAY TO WHICH HE WAS ENTITLED ON THE DATE OF HIS RETIREMENT. WITH OVER 30 YEARS OF SERVICE WAS $3. THE MAXIMUM RATE OF ACTIVE DUTY BASIC PAY WAS LIMITED TO $3. WOULD HAVE BEEN 75 PERCENT OF 3. THAT GENERAL BURCHINAL'S RETIRED PAY WAS AND IS BEING PAID BASED ON THE PROVISIONS OF 10 U.S.C. 1401AE) WHICH PROVIDES AS FOLLOWS: "(E) NOTWITHSTANDING SUBSECTIONS (C) AND (D). MAY NOT BE LESS THAN IT WOULD HAVE BEEN HAD HE BECOME ENTITLED TO RETIRED PAY OR RETAINER PAY BASED ON THE SAME PAY GRADE.

B-179191, MAR 25, 1974

HEADNOTES-UNAVALIABLE PRECIS-UNAVAILABLE

MR. N. R. BRENINGSTALL:

ACCOUNTING AND FINANCE OFFICER

THROUGH DEPUTY ASSISTANT COMPTROLLER FOR

ACCOUNTING AND FINANCE (AF/ACFA)

HEADQUARTERS UNITED STATES AIR FORCE WASHINGTON, D.C. 20330

FURTHER REFERENCE IS MADE TO YOUR LETTER DATED JULY 3, 1973 (FILE REFERENCE RPTT), REQUESTING AN ADVANCE DECISION AS TO THE PROPRIETY OF MAKING PAYMENT ON A VOUCHER IN THE AMOUNT OF $337.21, IN FAVOR OF GENERAL DAVID A. BURCHINAL, USAF, RETIRED, SSAN XXX-XX-XXXX, REPRESENTING THE DIFFERENCE BETWEEN THE RETIRED PAY OF A GENERAL (0 10), WITH MORE THAN 30 YEARS OF SERVICE WHO RETIRED IN 1971 AND THE RETIRED PAY OF A GENERAL WITH COMPARABLE SERVICE WHO RETIRED IN 1973, FOR THE PERIOD MARCH 1 THROUGH JULY 31, 1973.

YOU SAY THAT GENERAL BURCHINAL WAS RETIRED ON FEBRUARY 28, 1973, UNDER 10 U.S.C. 8918 WITH MORE THAN 30 YEARS OF SERVICE. UNDER THE PROVISIONS OF 10 U.S.C. 8991, FORMULA B, HE WAS ENTITLED TO MONTHLY RETIRED PAY IN THE AMOUNT OF 75 PERCENT OF THE MONTHLY BASIC PAY TO WHICH HE WAS ENTITLED ON THE DATE OF HIS RETIREMENT.

AS PROVIDED BY 37 U.S.C. 203 AND EXECUTIVE ORDER NO. 11692, EFFECTIVE JANUARY 1, 1973, THE RATE OF BASIC PAY FOR A GENERAL (0-10), WITH OVER 30 YEARS OF SERVICE WAS $3,394.20 PER MONTH, 75 PERCENT OF WHICH WOULD BE $2,545.65. HOWEVER, THE MAXIMUM RATE OF ACTIVE DUTY BASIC PAY WAS LIMITED TO $3,000 PER MONTH (THE RATE OF LEVEL V OF THE EXECUTIVE SCHEDULE) BY 5 U.S.C. 5308. SEE IN THIS CONNECTION OUR DECISION B-178170, MAY 17, 1973, 52 COMP.GEN. 817. THUS, COMPUTED ON THE PAY RATES IN EFFECT ON THE DATE OF HIS RETIREMENT, IT APPEARS GENERAL BURCHINAL'S RETIRED PAY, EFFECTIVE MARCH 1, 1973, WOULD HAVE BEEN 75 PERCENT OF 3,000, OR $2,250 PER MONTH.

YOU INDICATE, HOWEVER, THAT GENERAL BURCHINAL'S RETIRED PAY WAS AND IS BEING PAID BASED ON THE PROVISIONS OF 10 U.S.C. 1401AE) WHICH PROVIDES AS FOLLOWS:

"(E) NOTWITHSTANDING SUBSECTIONS (C) AND (D), THE ADJUSTED RETIRED PAY OR RETAINER PAY OF A MEMBER OF FORMER MEMBER OF AN ARMED FORCE RETIRED ON OR AFTER OCTOBER 1, 1967, MAY NOT BE LESS THAN IT WOULD HAVE BEEN HAD HE BECOME ENTITLED TO RETIRED PAY OR RETAINER PAY BASED ON THE SAME PAY GRADE, YEARS OF SERVICE FOR PAY, YEARS OF SERVICE FOR RETIRED OR RETAINER PAY PURPOSES, AND PERCENT OF DISABILITY, IF ANY, ON THE DAY BEFORE THE EFFECTIVE DATE OF THE RATES OF MONTHLY BASIC PAY ON WHICH HIS RETIRED PAY OR RETAINER PAY IS BASED."

UNDER THAT STATUTE GENERAL BURCHINAL'S RETIRED PAY WAS COMPUTED AS 75 PERCENT OF THE RATES OF BASIC PAY OF A GENERAL (0-10), WHICH WERE IN EFFECT ON THE DAY BEFORE THE EFFECTIVE DATE OF THE BASIC PAY RATES IN EFFECT AT THE TIME OF HIS RETIREMENT. SEE EXECUTIVE ORDER NO. 11638, EFFECTIVE JANUARY 1, 1972. UNDER THAT COMPUTATION METHOD GENERAL BURCHINAL'S RETIRED PAY WAS COMPUTED AS $2,250 PLUS 1.0 PERCENT CONSUMER PRICE INDEX (CPI) INCREASE WHICH BECAME EFFECTIVE JULY 1, 1972, FOR A TOTAL OF $2,272.50 PER MONTH AT THE TIME OF HIS RETIREMENT. HIS RETIRED PAY WAS SUBSEQUENTLY INCREASED TO $2,411.12 BY THE 6.1 PERCENT CPI INCREASE EFFECTIVE JULY 1, 1973.

YOU NOTE, HOWEVER, THAT WITHOUT CONSIDERING 10 U.S.C. 1401AE), A GENERAL (0-10) WITH THE SAME SERVICE AS GENERAL BURCHINAL, WHO RETIRED AUGUST 31, 1971, WOULD CURRENTLY BE ENTITLED TO MONTHLY RETIRED PAY OF $2,489.67 COMPUTED BASED ON THE 1971 BASIC PAY RATES PLUS ALL CPI INCREASES THROUGH JULY 1, 1973; A SIMILAR GENERAL RETIRED APRIL 30, 1972, WOULD NOW BE ENTITLED TO RETIRED PAY OF $2,411.12 COMPUTED BASED ON THE 1972 BASIC PAY RATES PLUS ALL CPI INCREASES THROUGH JULY 1, 1973; AND A GENERAL, SUCH AS GENERAL BURCHINAL, RETIRED ON FEBRUARY 28, 1973, WOULD NOW BE ENTITLED TO $2,310.75 COMPUTED BASED ON 1973 BASIC PAY RATES PLUS THE CPI INCREASE EFFECTIVE JULY 1, 1973. YOU FURTHER INDICATE THAT BY APPLYING 10 U.S.C. 1401AE) IT APPEARS THAT THE GENERAL WHO RETIRED IN 1972 IS ENTITLED TO HAVE HIS RETIRED PAY BASED ON THE RETIRED PAY HE WOULD HAVE RECEIVED HAD HE RETIRED IN 1971, OR $2,489.67, AND THE GENERAL WHO RETIRED IN 1973 IS ENTITLED TO HAVE HIS RETIRED PAY BASED ON THE RETIRED PAY HE WOULD HAVE RECEIVED HAD HE RETIRED IN 1972, OR $2,411.12. UNDER THAT INTERPRETATION OF 10 U.S.C. 1401AE), A GENERAL SUCH AS GENERAL BURCHINAL, RECEIVES LESS RETIRED PAY NOW THAN A GENERAL WHO RETIRED IN 1971 OR 1972.

YOU ARE, THEREFORE, IN DOUBT AS TO WHETHER THAT IS THE CORRECT INTERPRETATION OF 10 U.S.C. 1401AE) AND ASK WHETHER THE STATUTE IS BROAD ENOUGH TO PERMIT EQUATING THE RETIRED PAY OF GENERAL BURCHINAL WITH THAT OF OFFICERS OF THE SAME GRADE AND SERVICE RETIRED BEFORE 1972 IN ORDER TO ENTITLE HIM TO A HIGHER RATE OF RETIRED PAY. YOU ALSO ASK WHETHER THE RETIRED PAY OF AN OFFICER WHO HAS SERVED AS CHIEF OF STAFF MAY BE SIMILARLY EQUATED TO THAT OF PREVIOUSLY RETIRED OFFICERS WHO HAVE SERVED AS CHIEF OF STAFF.

SUBSECTION 1401AE) OF TITLE 10 U.S. CODE, WAS ADDED BY SECTION 2 OF THE ACT OF DECEMBER 16, 1967, PUBLIC LAW 90-207, 81 STAT. 652, WHICH BECAME EFFECTIVE OCTOBER 1, 1967. THE PURPOSE OF ADDING SUBSECTION (E) OF SECTION 1401A IS EXPLAINED AS FOLLOWS IN THE LEGISLATIVE HISTORY OF SECTION 2 OF PUBLIC LAW 90-207 ON PAGE 19 OF SENATE REPORT NO. 808 (TO ACCOMPANY H.R. 13510 WHICH BECAME PUBLIC LAW 90-207):

"CLAUSE I: NEW SUBSECTION (E) IS A TECHNICAL AMENDMENT RECOMMENDED BY THE DEPARTMENT OF DEFENSE WITH RESPECT TO INCREASES FOR RETIRED PERSONNEL BASED ON ADVANCES IN THE CONSUMER PRICE INDEX. DESPITE THE PROVISIONS IN THE HOUSE VERSION MODIFYING THE CONSUMER PRICE INDEX FORMULA, THERE REMAINED A POSSIBLE INEQUITY RESULTING FROM A COMBINATION OF THE UPWARD MOVEMENT OF THE CONSUMER PRICE INDEX'S TOGETHER WITH THE TRANSITIONAL PROVISIONS CONTAINED ELSEWHERE IN THE BILL. WITHOUT THE FURTHER AMENDMENT, THERE WOULD HAVE BEEN SITUATIONS WHERE PERSONS RETIRING AFTER THE EFFECTIVE DATE OF THIS LEGISLATION IN THE SAME GRADE AND BASIC PAY WOULD RECEIVE LESS THAN CERTAIN INDIVIDUALS IN THE SAME CIRCUMSTANCES RETIRING PRIOR TO THE EFFECTIVE DATE OF THIS LEGISLATION. THE AMENDMENT ADOPTED IN COMMITTEE WILL INSURE THAT THOSE RETIRING AFTER THE EFFECTIVE DATE OF THIS BILL AND BEFORE THE NEXT PAY INCREASE WILL RECEIVE AS MUCH IN RETIRED PAY AS COMPARABLE MEMBERS RETIRING BEFORE THE EFFECTIVE DATE OF THE BILL." WHILE SUBSECTION (E) WAS ENACTED AS PERMANENT LEGISLATION, IT IS CLEAR FROM ITS LEGISLATIVE HISTORY THAT IT WAS ADOPTED PRIMARILY TO REMEDY AN INEQUITY WHICH AROSE AT THE TIME PUBLIC LAW 90-207 WAS STILL IN THE LEGISLATIVE PROCESS. NOWHERE IN ITS LEGISLATIVE HISTORY IS THERE ANY INDICATION THAT CONGRESS INTENDED THAT SUBSECTION (E) WOULD AUTHORIZE THE COMPUTATION OF A MEMBER'S RETIRED PAY BASED ON RATES OF ACTIVE DUTY PAY IN EFFECT PRIOR TO THOSE IN EFFECT "ON THE DAY BEFORE THE EFFECTIVE DATE OF THE RATES OF MONTHLY BASIC PAY ON WHICH HIS RETIRED OR RETAINER PAY IS BASED."

ALSO, AS NOTED PREVIOUSLY, IF THE LIMITATION IMPOSED BY 5 U.S.C. 5308 WERE NOT IN EFFECT, GENERAL BURCHINAL'S RETIRED PAY WOULD HAVE BEEN COMPUTED AS 75 PERCENT OF $3,394.20 RATHER THAN 75 PERCENT OF $3,000. THUS, HE WOULD HAVE BEEN ENTITLED TO $2,545.65 IN RETIRED PAY, WHICH IS MORE THAN THE RETIRED PAY OF A SIMILAR GENERAL RETIRED IN 1971 OR 1972. CONGRESS IS AWARE OF THE LIMITATIONS IMPOSED BY 5 U.S.C. 5308 (WHICH APPLY TO BOTH MILITARY AND CIVILIAN GOVERNMENT PERSONNEL), AND IS ALSO AWARE THAT PROBLEMS MAY ARISE IN THE SYSTEM FOR EXAMPLE, THE ACT OF OCTOBER 24, 1973, PUBLIC LAW 93-136, 87 STAT. 490, WHICH AMENDED 5 U.S.C. 8340(C), RELATING TO THE APPLICATION OF SIMILAR INCREASES TO CIVIL SERVICE EMPLOYEES' RETIREMENT ANNUITIES.

ACCORDINGLY, IT IS OUR VIEW THAT IN THE ABSENCE OF SPECIFIC LANGUAGE IN THE STATUTE OR ITS LEGISLATIVE HISTORY TO THE CONTRARY, THE FLOOR PROVIDED BY 10 U.S.C. 1401AE) MUST BE REGARDED AS THE RATE OF PAY IN EFFECT ON THE DAY BEFORE THE EFFECTIVE DATE OF THE RATE OF MONTHLY BASIC PAY ON WHICH THE MEMBER'S RETIRED PAY WOULD OTHERWISE BE BASED, PLUS THE APPROPRIATE CPI INCREASES FROM THAT DATE FORWARD. ANY INEQUITIES RESULTING FROM THE APPLICATION OF SECTION 1401AE) IS A MATTER FOR CONSIDERATION BY THE CONGRESS.

SINCE IT APPEARS THAT GENERAL BURCHINAL HAS BEEN RECEIVING RETIRED PAY BASED UPON THE PROPER INTERPRETATION OF SECTION 1401AE), HE IS NOT ENTITLED TO ANY ADDITIONAL RETIRED PAY. THE VOUCHER SUBMITTED WITH YOUR LETTER WILL BE RETAINED HERE.

REGARDING YOUR QUESTION CONCERNING A RETIRED OFFICER WHO HAS SERVED AS CHIEF OF STAFF, THE RATIONALE APPLIED IN REACHING THE CONCLUSION IN GENERAL BURCHINAL'S CASE WOULD BE EQUALLY APPLICABLE IN COMPUTING THE RETIRED PAY OF AN OFFICER WHO SERVED IN THAT CAPACITY.