B-179314, MAY 7, 1974, 53 COMP GEN 832

B-179314, MAY 7, 1974, 53 COMP GEN 832

PAY - RETIRED - ANNUITY ELECTIONS FOR DEPENDENTS - SURVIVOR BENEFIT PLAN - COST DEDUCTIONS AND COVERAGE - EFFECTIVE DATE SINCE 10 U.S.C. 1448(A) PROVIDES THAT COVERAGE UNDER SURVIVOR BENEFIT PLAN COMMENCES WHEN INDIVIDUAL BECOMES ENTITLED TO RETIRED OR RETAINER PAY, PERSONS RETIRED UNDER PROVISIONS OF 10 U.S.C. 1331, WHO BECOME ENTITLED TO RETIRED PAY WHEN APPLICATION FOR RETIRED PAY IS FILED WITH DEPARTMENT CONCERNED, RECEIVE COVERAGE UNDER PLAN AT THAT TIME AND DEDUCTIONS FROM RETIRED PAY COMMENCE CORRESPONDINGLY WITH THE INCEPTION OF COVERAGE.

IN THE MATTER OF DEDUCTIONS UNDER THE SURVIVOR BENEFIT PLAN FOR RETIRED RESERVISTS, MAY 7, 1974:

THIS ACTION IS IN RESPONSE TO A REQUEST FOR ADVANCE DECISION FROM THE PRINCIPAL DEPUTY ASSISTANT SECRETARY OF DEFENSE (COMPTROLLER), ON THE QUESTION AS TO WHAT IS THE EFFECTIVE DATE OF COVERAGE, AND THE DATE ON WHICH CHARGES FOR SURVIVOR BENEFIT PLAN PROTECTION COMMENCE UNDER THE PROVISIONS OF 10 U.S.C. 1447-1455, WHEN A MEMBER OF THE RESERVE SUBMITS HIS APPLICATION FOR RETIRED PAY TO AN OFFICE OTHER THAN THE SERVICE FINANCE CENTER. DEPARTMENT OF DEFENSE MILITARY PAY AND ALLOWANCE COMMITTEE ACTION NO. 488 WAS ENCLOSED WITH THE LETTER TRANSMITTING THE REQUEST FOR DECISION.

THE COMMITTEE ACTION STATES THAT IN A MEMORANDUM DATED DECEMBER 11, 1972, FROM THE COUNSEL FOR THE DEPARTMENT OF DEFENSE MILITARY PAY AND ALLOWANCE COMMITTEE TO THE DEPUTY ASSISTANT SECRETARY OF DEFENSE (MILITARY PERSONNEL POLICY), CONDITIONS OF COVERAGE UNDER THE SURVIVOR BENEFIT PLAN FOR MEMBERS OF THE RETIRED RESERVE WERE DEFINED. IN THAT MEMORANDUM IT WAS STATED THAT COVERAGE IS EFFECTIVE FROM THE DATE SUCH A MEMBER'S APPLICATION FOR RETIRED PAY IS RECEIVED AT THE FINANCE CENTER OF THE SERVICE CONCERNED.

IT IS NOTED IN THE COMMITTEE ACTION THAT THIS DETERMINATION WAS APPARENTLY BASED ON THE ASSUMPTION THAT APPLICATIONS FOR RETIRED PAY FROM ELIGIBLE RESERVISTS ARE SUBMITTED TO THE FINANCE CENTERS WITHIN ALL SERVICE ORGANIZATIONS. HOWEVER, IT IS INDICATED THAT DEPARTMENT OF THE NAVY PROCEDURES REQUIRE THAT APPLICATIONS FOR RETIRED PAY BY NAVAL RESERVE MEMBERS BE SUBMITTED TO THE CHIEF OF NAVAL PERSONNEL, WHERE THE APPLICATIONS ARE PROCESSED AND ORDERS ARE ISSUED TRANSFERRING THE MEMBER TO THE RETIRED LIST. IT IS REPORTED THAT COPIES OF THE ORDERS ARE THEN SENT TO THE NAVY FINANCE CENTER AND ARE USED TO ESTABLISH THE MEMBER'S RETIRED PAY ACCOUNT. HOWEVER, SINCE A TIME LAG OF SEVERAL MONTHS MAY OCCUR BETWEEN SERVICE RECEIPT OF THE MEMBER'S APPLICATION AND RECEIPT OF HIS RETIREMENT ORDERS AT THE NAVY FINANCE CENTER, A DECISION HAS BEEN REQUESTED WHICH MAY UNIFORMLY BE APPLIED TO ALL THE SERVICES.

SUBSECTION 1448(A) OF TITLE 10, U.S. CODE, PROVIDES IN PART THAT THE PLAN APPLIES TO A PERSON WHO IS MARRIED OR HAS A DEPENDENT CHILD AT THE TIME HE BECOMES ENTITLED TO RETIRED OR RETAINER PAY UNLESS HE ELECTS NOT TO PARTICIPATE IN THE PLAN BEFORE THE FIRST DAY FOR WHICH HE BECOMES ELIGIBLE FOR THAT PAY. THUS, IT WILL BE SEEN THAT COVERAGE UNDER THE PLAN COMMENCES WHEN AN INDIVIDUAL BECOMES ENTITLED TO RETIRED OR RETAINER PAY.

UNDER THE PROVISIONS OF 10 U.S.C. 1331, WHICH APPLIES TO NON-REGULAR SERVICE PERSONNEL, A PERSON IS ENTITLED TO RETIRED PAY UPON APPLICATION TO THE SECRETARY OF THE MILITARY DEPARTMENT FOR SUCH PAY, IF HE IS AT LEAST 60 YEARS OF AGE, HAS PERFORMED AT LEAST 20 YEARS OF SERVICE COMPUTED UNDER THE PROVISIONS OF 10 U.S.C. 1332 AND MET THE OTHER REQUIREMENTS OF THAT SECTION.

WHILE IT HAS BEEN HELD THAT THE RIGHT TO RETIRED PAY ACCRUES FROM THE TIME THE AGE AND SERVICE REQUIREMENTS OF 10 U.S.C. 1331 HAVE BEEN MET, PAYMENT OF RETIRED PAY IS NOT MADE UNTIL APPLICATION IS MADE TO THE SECRETARY CONCERNED. SEE SEAGRAVE V. UNITED STATES, 131 CT. CL. 790 (1955) AND 37 COMP. GEN. 653 (1958).

THEREFORE, FOR THE PURPOSES OF THE SURVIVOR BENEFIT PLAN, SUBJECT, OF COURSE, TO THE CONDITIONS SET FORTH IN 10 U.S.C. 1448, AND THE LIMITATIONS CONTAINED IN 10 U.S.C. 1331, IT IS OUR VIEW THAT COVERAGE UNDER THE PLAN COMMENCES WHEN APPLICATION FOR RETIRED PAY IS MADE TO THE ACTIVITY OF THE MILITARY DEPARTMENT SPECIFICALLY DESIGNATED TO RECEIVE SUCH APPLICATION UNDER REGULATIONS PRESCRIBED BY THE SECRETARY CONCERNED. DEDUCTIONS FROM RETIRED OR RETAINER PAY SHOULD BE MADE OR PAYMENT OF PREMIUMS SHOULD BE MADE UNDER 10 U.S.C. 1452, COMMENCING ON A DATE FOLLOWING SUCH APPLICATION WHICH WOULD CORRESPOND WITH THE INCEPTION OF COVERAGE UNDER THE PLAN.