B-180050, AUG 14, 1974, 54 COMP GEN 116

B-180050: Aug 14, 1974

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PAY - RETIRED - SURVIVOR BENEFIT PLAN - RECORD CORRECTION - ENTITLEMENT TO RETIRED PAY PRIOR TO SBP - SBP COVERAGE - NOT AUTOMATIC A PERSON WHOSE MILITARY RECORD IS CORRECTED ON DATE SUBSEQUENT TO SEPTEMBER 20. IS NOT AUTOMATICALLY COVERED UNDER SURVIVOR BENEFIT PLAN (SBP). SINCE PURPOSE OF RECORD CORRECTION IS TO PLACE MEMBER AS NEARLY AS POSSIBLE IN SAME POSITION HE WOULD HAVE OCCUPIED HAD HE BEEN RETIRED AT EARLIER DATE AND IN ORDER TO BE AUTOMATICALLY COVERED UNDER SBP MEMBER MUST BECOME ENTITLED TO RETIRED OR RETAINER PAY SUBSEQUENT TO EFFECTIVE DATE OF SBP. PAY - RETIRED - SURVIVOR BENEFIT PLAN - RECORD CORRECTION ENTITLEMENT TO RETIRED PAY SUBSEQUENT TO SBP - SBP COVERAGE - AUTOMATIC PERSONS WHOSE MILITARY RECORDS ARE CORRECTED ON DATE SUBSEQUENT TO SEPTEMBER 20.

B-180050, AUG 14, 1974, 54 COMP GEN 116

PAY - RETIRED - SURVIVOR BENEFIT PLAN - RECORD CORRECTION - ENTITLEMENT TO RETIRED PAY PRIOR TO SBP - SBP COVERAGE - NOT AUTOMATIC A PERSON WHOSE MILITARY RECORD IS CORRECTED ON DATE SUBSEQUENT TO SEPTEMBER 20, 1972, TO SHOW ENTITLEMENT TO RETIRED PAY ON DATE PRIOR TO SEPTEMBER 20, 1972, IS NOT AUTOMATICALLY COVERED UNDER SURVIVOR BENEFIT PLAN (SBP), SINCE PURPOSE OF RECORD CORRECTION IS TO PLACE MEMBER AS NEARLY AS POSSIBLE IN SAME POSITION HE WOULD HAVE OCCUPIED HAD HE BEEN RETIRED AT EARLIER DATE AND IN ORDER TO BE AUTOMATICALLY COVERED UNDER SBP MEMBER MUST BECOME ENTITLED TO RETIRED OR RETAINER PAY SUBSEQUENT TO EFFECTIVE DATE OF SBP. PAY - RETIRED - SURVIVOR BENEFIT PLAN - RECORD CORRECTION - ENTITLEMENT TO RETIREMENT PAY PRIOR TO SBP - ELECTION STATUS MEMBERS WHO BECOME RETROACTIVELY ENTITLED TO RETIRED OR RETAINER PAY PRIOR TO EFFECTIVE DATE OF SURVIVOR BENEFIT PLAN BY VIRTUE OF RECORD CORRECTION OCCURRING AFTER THAT DATE, AND STATUTORY TIME LIMIT FOR MEMBERS ENTITLED TO RETIRED OR RETAINER PAY ON EFFECTIVE DATE OF THE ACT TO ELECT TO PARTICIPATE HAS EXPIRED, MUST BE AFFORDED THE SAME OPPORTUNITY AS OTHER PRIOR RETIREES TO ELECT INTO THE PLAN SUCH PERIOD IN THEIR CASE BEING 18 MONTHS FROM THE DATE OF NOTIFICATION OF RECORDS CORRECTION. PAY - RETIRED - SURVIVOR BENEFIT PLAN - RECORD CORRECTION ENTITLEMENT TO RETIRED PAY SUBSEQUENT TO SBP - SBP COVERAGE - AUTOMATIC PERSONS WHOSE MILITARY RECORDS ARE CORRECTED ON DATE SUBSEQUENT TO SEPTEMBER 20, 1972, TO SHOW ENTITLEMENT TO RETIRED OR RETAINER PAY COMMENCING SUBSEQUENT TO THAT DATE ARE AUTOMATICALLY COVERED UNDER SURVIVOR BENEFIT PLAN AND MAY NOT BE AFFORDED A PERIOD OF TIME TO DECLINE COVERAGE OR ELECT REDUCED COVERAGE AFTER AWARD OF RETIRED PAY, SINCE THEIR POSITIONS CANNOT BE DISTINGUISHED FROM A MEMBER BECOMING ENTITLED TO RETIRED OR RETAINER PAY WITHOUT CORRECTION OF THEIR RECORD AND DO NOT RECEIVE OPPORTUNITY TO ELECT REDUCED COVERAGE OR DECLINE COVERAGE AFTER THEY BECOME ENTITLED TO THAT PAY.

IN THE MATTER OF SURVIVOR BENEFIT PLAN PARTICIPATION FOLLOWING A RECORD CORRECTION, AUGUST 14, 1974:

THIS ACTION IS IN RESPONSE TO A REQUEST FOR ADVANCE DECISION FROM THE PRINCIPAL DEPUTY ASSISTANT SECRETARY OF DEFENSE (COMPTROLLER) CONCERNING SURVIVOR BENEFIT PLAN COVERAGE IN THE CASE OF MEMBERS INITIALLY GRANTED RETIRED PAY AS A RESULT OF A CORRECTION OF RECORDS, WHICH CORRECTION OCCURRED ON OR AFTER SEPTEMBER 21, 1973, BUT WAS RETROACTIVELY EFFECTIVE ON A DATE PRIOR TO SEPTEMBER 21, 1972. THE SPECIFIC QUESTIONS AND A DISCUSSION THEREOF ARE CONTAINED IN DEPARTMENT OF DEFENSE MILITARY PAY AND ALLOWANCE COMMITTEE ACTION NO. 497, ENCLOSED WITH THE TRANSMITTAL LETTER.

THE QUESTIONS ARE AS FOLLOWS:

1. IN THE CASE OF A MEMBER WHO IS INITIALLY GRANTED RETIRED PAY ON OR AFTER 21 SEPTEMBER 1973 BUT RETROACTIVE TO A DATE PRIOR TO 21 SEPTEMBER 1972, AS A RESULT OF CORRECTION OF RECORDS, WOULD SUCH A MEMBER BE -

A. REQUIRED TO MAKE A SURVIVOR BENEFIT PLAN ELECTION WITHIN A SPECIFIED PERIOD OF TIME SIMILAR TO THE REQUIREMENT PLACED ON RETIRED SERVICEMEN'S FAMILY PROTECTION PLAN (RSFPP) ELECTIONS BY THE COMPTROLLER GENERAL OF THE UNITED STATES IN B-122198, 11 MAY 1955 (34 COMP. GEN. 582); OR

B. AUTOMATICALLY COVERED BECAUSE OF THE PROVISIONS STATED IN TITLE 10, U.S.C. SECTION 1448(A)?

2. IF THE ANSWER TO QUESTION 1 IS A, ABOVE, WHAT WOULD BE THE MAXIMUM PERIOD DURING WHICH THE MEMBER MAY MAKE AN ELECTION?

3. IF THE ANSWER TO QUESTION 1 IS B, ABOVE, MAY SUCH A MEMBER BE PERMITTED THE PRIVILEGE OF ELECTING OUT OR REDUCING COVERAGE SIMILAR TO THAT PROVIDED A MEMBER RETIRED WITHIN 180 DAYS OF PASSAGE OF PL 92 425?

4. WOULD THE ANSWERS BE THE SAME IF THE MEMBER WAS GRANTED RETROACTIVE RETIRED PAY EFFECTIVE ON A DATE SUBSEQUENT TO 20 SEPTEMBER 1972? (MEMBERS WHO RETIRED AFTER 20 SEPTEMBER 1972, ARE AUTOMATICALLY COVERED, UNLESS THEY ELECT NOT TO PARTICIPATE IN THE PLAN.)

IN THE DISCUSSION OF THE QUESTIONS SET FORTH IN THE COMMITTEE ACTION, IT IS POINTED OUT THAT IN OUR DECISION 34 COMP. GEN. 582 (1965), INVOLVING THE UNIFORMED SERVICES CONTINGENCY OPTION ACT OF 1953, APPROVED AUGUST 8, 1953, 67 STAT. 501, IT WAS HELD THAT THE MEMBERS WHO HAD THEIR RECORDS CORRECTED TO SHOW AN EARLIER RETIREMENT WERE REQUIRED TO MAKE THEIR ELECTION UNDER THAT PLAN "AT THE TIME" THEY WERE AWARDED RETIRED PAY. UNDER THE HOLDING IN THAT DECISION, MEMBERS WHO FILED ELECTIONS MORE THAN 60 DAYS FOLLOWING THE AWARD OF RETIRED PAY WERE NOT ENTITLED TO PARTICIPATE IN THE PLAN, BASED ON THE LANGUAGE OF THE STATUTE WHICH PROVIDED THAT A FORMER MEMBER ON THE EFFECTIVE DATE OF THE ACT AND WHO IS THEREAFTER AWARDED RETIRED PAY MAY MAKE HIS ELECTION TO PARTICIPATE IN THAT PLAN AT THE TIME HE IS AWARDED THAT PAY. IT WAS FURTHER POINTED OUT THAT THIS PROVISION WAS SUBSEQUENTLY AMENDED TO PROVIDE A SPECIFIC PERIOD OF TIME FOR MAKING SUCH ELECTIONS UNDER THE CIRCUMSTANCES DESCRIBED, BUT THAT THE SURVIVOR BENEFIT PLAN DOES NOT CONTAIN SIMILAR LANGUAGE.

IT IS ALSO NOTED IN THE COMMITTEE ACTION THAT 10 U.S.C. 1448(A) PROVIDES THAT THE PLAN APPLIES TO A PERSON WHO IS MARRIED OR HAS A DEPENDENT CHILD WHEN HE BECOMES ENTITLED TO RETIRED OR RETAINER PAY, UNLESS HE ELECTS NOT TO PARTICIPATE IN THE PLAN BEFORE THE FIRST DAY FOR WHICH HE IS ENTITLED TO THAT PAY. THE DISCUSSION ALSO REFERS TO THE PROVISIONS OF SUBSECTION 3(A) OF PUBLIC LAW 92-425, APPROVED SEPTEMBER 21, 1972, 86 STAT. 706, WHICH STATES THAT MEMBERS RETIRED WITHIN 180 DAYS AFTER THE EFFECTIVE DATE OF THE ACT MAY BE ALLOWED TO ELECT NOT TO PARTICIPATE OR TO PARTICIPATE AT LESS THAN FULL ANNUITY WITHIN 180 DAYS AFTER BECOMING ENTITLED TO RETIRED PAY. A CITATION TO THE LEGISLATIVE HISTORY OF THAT SECTION INDICATES THE CONGRESS INTENDED TO GRANT A MEMBER WHO RETIRES WITHIN THAT TIME FRAME A REASONABLE AMOUNT OF TIME TO DECIDE WHETHER TO PARTICIPATE IN THE PLAN.

THE DISCUSSION IN THE COMMITTEE ACTION CONCLUDES BY STATING THAT IT WOULD APPEAR SUCH A MEMBER IS AUTOMATICALLY COVERED UNDER THE PROVISIONS OF 10 U.S.C. 1448(A). HOWEVER, AS A MATTER OF EQUALITY, IT APPEARS THAT THE MEMBER SHOULD BE GRANTED THE SAME OPPORTUNITY AS A MEMBER RETIRED WITHIN 180 DAYS AFTER THE EFFECTIVE DATE OF PUBLIC LAW 92-425.

THE PURPOSE OF CORRECTING A MEMBER'S MILITARY RECORDS PURSUANT TO THE PROVISIONS TO 10 U.S.C. 1552 IS TO CORRECT AN ERROR OR REMOVE AN INJUSTICE FROM HIS RECORDS, THEREBY PLACING THE MEMBER AS NEARLY AS POSSIBLE IN THE SAME POSITION HE WOULD HAVE OCCUPIED HAD THE ERROR OR INJUSTICE NOT ARISEN. THUS, IF A MEMBER IS INITIALLY GRANTED RETIRED PAY AFTER THE EFFECTIVE DATE OF THE SURVIVOR BENEFIT PLAN (SEPTEMBER 21, 1972), PURSUANT TO A RECORD CORRECTION, SUCH RIGHTS AS HE MAY HAVE TO BENEFITS UNDER THE PLAN MUST BE BASED ON THE EFFECTIVE DATE OF HIS RETIREMENT.

IN THIS REGARD, SUBSECTION 3(B) OF THE ABOVE-CITED ACT PROVIDES THAT A PERSON WHO IS ENTITLED TO RETIRED OR RETAINER PAY ON THE EFFECTIVE DATE OF THE SURVIVOR BENEFIT PLAN MAY ELECT TO PARTICIPATE IN THE PLAN BEFORE THE FIRST ANNIVERSARY OF THAT DATE. THIS 1-YEAR PERIOD WAS SUBSEQUENTLY EXTENDED TO 18 MONTHS BY PUBLIC LAW 93-155, APPROVED NOVEMBER 16, 1973, 87 STAT. 605. THE STATUTORY PERIOD, HOWEVER, EXPIRED ON MARCH 21, 1974.

THUS, A SITUATION IS CREATED WHERE, BY OPERATION OF VARIOUS LAWS, A PERSON BECOMES ENTITLED TO RETIRED OR RETAINER PAY ON OR BEFORE THE EFFECTIVE DATE OF THE SURVIVOR BENEFIT PLAN, BUT UNDER THE LAW AS ENACTED WOULD BE PRECLUDED FROM PARTICIPATING IN THE PLAN AS A RESULT OF THE EXPIRATION OF THE STATUTORY TIME LIMITATION IMPOSED BY THE ACT FOR ELECTING TO PARTICIPATE, PRIOR TO THE DATE ACTION WAS TAKEN TO GRANT THE MEMBER THE RIGHT TO RETIRED OR RETAINER PAY. WE DO NOT BELIEVE SUCH A RESULT WAS INTENDED BY CONGRESS.

THE LEGISLATIVE HISTORY OF THE SURVIVOR BENEFIT PLAN DOES NOT SPECIFICALLY ADDRESS ITSELF TO OR SEEM TO EVEN RECOGNIZE THE EXISTENCE OF A SITUATION INVOLVING A PERSON WHO IS RETROACTIVELY RETIRED EFFECTIVE ON A DATE PRIOR TO THE INCEPTION DATE OF THE SURVIVOR BENEFIT PLAN. HOWEVER, IT DOES PROVIDE AMPLE INDICATION THAT THE CONGRESS INTENDED TO AFFORD THE OPPORTUNITY OF PARTICIPATION IN THE PLAN TO ALL PERSONS WHO WERE ENTITLED TO RETIRED OR RETAINER PAY ON THE EFFECTIVE DATE OF THE ACT AS WELL AS TO ALL PERSONS WHO SUBSEQUENTLY BECAME ENTITLED TO RETIRED OR RETAINER PAY. FURTHERMORE, THE OVERALL PURPOSE OF THE ACT AND THE CLEAR EXPRESSION OF CONGRESSIONAL INTENT AS EVIDENCED BY SECTION 3 OF THE ACT WITH REGARD TO THOSE ON THE RETIRED ROLLS AND THOSE BECOMING ENTITLED TO RETIRED PAY WITHIN A SHORT PERIOD FOLLOWING THE EFFECTIVE DATE OF THE PLAN, SUPPORT THE CONCLUSION THAT MEMBERS RETIRING UNDER THE CIRCUMSTANCES DESCRIBED IN THE SUBMISSION SHOULD BE PROVIDED EVERY OPPORTUNITY TO PARTICIPATE IN THE PLAN.

ACCORDINGLY, IT IS OUR VIEW THAT PERSONS WHO RETROACTIVELY BECOME ENTITLED TO RETIRED OR RETAINER PAY ON A DATE PRIOR TO OR ON THE EFFECTIVE DATE OF THE SURVIVOR BENEFIT PLAN BY VIRTURE OF CORRECTION OF THEIR MILITARY RECORDS UNDER 10 U.S.C. 1552 ARE NOT AUTOMATICALLY COVERED UNDER THE PROVISIONS OF 10 U.S.C. 1448(A). RATHER, COVERAGE UNDER THE PLAN IS BY VIRTUE OF SECTION 3(B) OF THE ACT AND SUCH PERSONS MUST BE AFFORDED THE OPPORTUNITY TO ELECT COVERAGE UNDER THE PLAN WITH POSITIVE ACTION TO BE TAKEN BY ADMINISTRATIVE OFFICERS TO INSURE THAT THE DETAILS OF THE PLAN, ITS BENEFITS AND COSTS ARE FULLY EXPLAINED AND UNDERSTOOD BY THE MEMBER. CF. 53 COMP. GEN. 192 (1973). QUESTION 1 IS ANSWERED ACCORDINGLY.

WITH REGARD TO QUESTION 2 AND AS NOTED ABOVE, SUBSECTION 3(B) OF PUBLIC LAW 92-425 PROVIDED A 1-YEAR PERIOD FOR THOSE MEMBERS ENTITLED TO RETIRED OR RETAINER PAY ON THE EFFECTIVE DATE OF THE ACT TO ELECT PARTICIPATION IN THE PLAN. THIS PERIOD WAS SUBSEQUENTLY EXTENDED AN ADDITIONAL 6 MONTHS. IT WOULD APPEAR THAT THE REASON FOR GRANTING SUCH A LIBERAL GRACE PERIOD STEMMED FROM THE FACT THAT WITH THE NEW LEGISLATION ADEQUATE TIME SHOULD BE AFFORDED TO INSURE THAT INFORMATION CONCERNING THE PLAN BE DISSEMINATED TO ALL MEMBERS TO WHOM THE PLAN APPLIES IN ORDER TO PERMIT THEM TO MAKE INTELLIGENT ELECTIONS. THEREFORE, SINCE ONE OF THE PURPOSES OF A CORRECTION OF RECORDS IS TO PLACE A MEMBER WHO IS AFFECTED THEREBY, INTO THE SAME RELATIVE POSITION AS THAT ENJOYED BY OTHER RETIREES WHO WERE RETIRED BEFORE THE EFFECTIVE DATE OF THE SURVIVOR BENEFIT PLAN, QUESTION 2 IS ANSWERED BY SAYING THAT SUCH MEMBER SHOULD BE PERMITTED 18 MONTHS FROM THE DATE OF NOTIFICATION OF THE CORRECTION ACTION AND QUESTION 3 NEED NOT BE ANSWERED.

IN THE CASE OF A MEMBER WHO WAS GRANTED RETROACTIVE RETIRED PAY BY VIRTUE OF A CORRECTION OF RECORDS EFFECTIVE ON A DATE SUBSEQUENT TO SEPTEMBER 20, 1972, HE WOULD BE AUTOMATICALLY COVERED UNDER THE PROVISIONS OF SECTION 1448(A) OF THE PLAN. IN SUCH CIRCUMSTANCES WE ARE UNABLE TO DISTINGUISH BETWEEN SUCH A MEMBER AND A MEMBER WHO RETIRES WITHOUT THE CORRECTION OF HIS RECORDS INSOFAR AS APPLICATION OF THE SURVIVOR BENEFIT PLAN IS CONCERNED. A MEMBER PRIOR TO HIS RETIREMENT AND ENTITLEMENT TO RETIRED PAY IS PRESUMED UNDER THE PERTINENT LAW TO BE INFORMED OF THE PROVISIONS OF THE SURVIVOR BENEFIT PLAN AND IS GIVEN THE OPPORTUNITY TO DECLINE COVERAGE OR ELECT REDUCED COVERAGE PRIOR TO THE TIME HE BECOMES ENTITLED TO RETIRED OR RETAINER PAY. IT IS OUR VIEW, THEREFORE, THAT A MEMBER WHO HAS APPLIED TO A CORRECTION BOARD FOR A CORRECTION OF HIS RECORDS TO SHOW ENTITLEMENT TO RETIRED PAY EFFECTIVE ON A DATE SUBSEQUENT TO SEPTEMBER 20, 1972, HAS THIS SAME OPPORTUNITY AND IT MUST BE ASSUMED THAT A MEMBER APPLYING FOR SUCH A CORRECTION HAS A REASONABLE EXPECTATION THAT HIS APPLICATION WILL BE FAVORABLY CONSIDERED. IN LIGHT OF THIS, IT WOULD SEEM THAT HE HAS ADEQUATE TIME TO ELECT REDUCED COVERAGE OR DECLINE PARTICIPATION PRIOR TO THE CORRECTION BOARD RECOMMENDATION AND SECRETARIAL ACTION CORRECTING HIS RECORD. IN THIS CONNECTION, WE MIGHT ADD THAT WE ASSUME THAT APPROPRIATE PROCEDURES WILL BE TAKEN ADMINISTRATIVELY TO ASSURE THAT MEMBERS SO RETIRED WILL BE AFFORDED THE SAME OPTIONS, INCLUDING THE ELECTION OUT PRIVILEGE, AS THOSE GRANTED MEMBERS RETIRING WITHOUT CORRECTION BOARD ACTION PRIOR TO THE DATE OF THEIR ENTITLEMENT TO RETIRED PAY.

QUESTION 4 IS ANSWERED ACCORDINGLY.