B-213187, DEC 7, 1983

B-213187: Dec 7, 1983

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UNITED STATES SENATE: THIS IS IN RESPONSE TO YOUR REQUEST. WHICH IS REQUIRED BY LAW ON ACCOUNT OF THE SURVIVOR'S ENTITLEMENT TO SOCIAL SECURITY BENEFITS BASED ON THE RETIREE'S MILITARY SERVICE. CALCULATING THIS OFFSET THE DEPARTMENT OF DEFENSE DID NOT TAKE INTO ACCOUNT THE REDUCTION IN SOCIAL SECURITY BENEFITS PAID TO THE PRINCIPAL BENEFICIARY AND HIS SURVIVOR WHICH IS REQUIRED WHEN THE BENEFICIARY RECEIVES SOCIAL SECURITY PAYMENTS BEFORE REACHING AGE 65. WE HELD THAT UNDER THE SURVIVOR BENEFIT PLAN THE DEPARTMENT WAS REQUIRED TO TAKE INTO ACCOUNT THIS REDUCTION IN SOCIAL SECURITY BENEFITS IN CALCULATING THE OFFSET AGAINST ANNUITIES PAID PURSUANT TO THE PLAN. THE PRIMARY REASON FOR THAT HOLDING WAS THAT THE LEGISLATIVE HISTORY OF THE SURVIVOR BENEFIT PLAN SHOWED THAT A SURVIVOR ANNUITY PLUS SOCIAL SECURITY PAYMENTS RECEIVED ON ACCOUNT OF THE RETIREE'S MILITARY SERVICE WERE TO EQUAL AT LEAST 55 PERCENT OF THE RETIREE'S RETIRED PAY.

B-213187, DEC 7, 1983

PRECIS-UNAVAILABLE

THE HONORABLE STROM THURMOND, UNITED STATES SENATE:

THIS IS IN RESPONSE TO YOUR REQUEST, DATED SEPTEMBER 20, 1983, FOR A REPORT CONCERNING A RECENT DECISION OF THE COMPTROLLER GENERAL AS IT PERTAINS TO AN INQUIRY WHICH YOU RECEIVED FROM YOUR CONSTITUENT, LIEUTENANT COLONEL ALBERT K. STEBBINS III, USAF, RETIRED.

THE SUBJECT DECISION MATTER OF LAMBERT, 62 COMP.GEN. (B-203393, JUNE 15, 1983), DEALS WITH THE METHOD USED BY THE DEPARTMENT OF DEFENSE TO CALCULATE THE SURVIVOR BENEFIT ANNUITY TO BE PAID SURVIVORS OF MILITARY RETIREES. PARTICULARLY, IT CONCERNS THE OFFSET FROM THE ANNUITY OTHERWISE PAYABLE, WHICH IS REQUIRED BY LAW ON ACCOUNT OF THE SURVIVOR'S ENTITLEMENT TO SOCIAL SECURITY BENEFITS BASED ON THE RETIREE'S MILITARY SERVICE. CALCULATING THIS OFFSET THE DEPARTMENT OF DEFENSE DID NOT TAKE INTO ACCOUNT THE REDUCTION IN SOCIAL SECURITY BENEFITS PAID TO THE PRINCIPAL BENEFICIARY AND HIS SURVIVOR WHICH IS REQUIRED WHEN THE BENEFICIARY RECEIVES SOCIAL SECURITY PAYMENTS BEFORE REACHING AGE 65. WE HELD THAT UNDER THE SURVIVOR BENEFIT PLAN THE DEPARTMENT WAS REQUIRED TO TAKE INTO ACCOUNT THIS REDUCTION IN SOCIAL SECURITY BENEFITS IN CALCULATING THE OFFSET AGAINST ANNUITIES PAID PURSUANT TO THE PLAN. THE PRIMARY REASON FOR THAT HOLDING WAS THAT THE LEGISLATIVE HISTORY OF THE SURVIVOR BENEFIT PLAN SHOWED THAT A SURVIVOR ANNUITY PLUS SOCIAL SECURITY PAYMENTS RECEIVED ON ACCOUNT OF THE RETIREE'S MILITARY SERVICE WERE TO EQUAL AT LEAST 55 PERCENT OF THE RETIREE'S RETIRED PAY. WE HELD THAT FAILURE OF THE DEPARTMENT TO TAKE INTO ACCOUNT THE REDUCTION IN THE ANNUITANT'S SOCIAL SECURITY PAYMENT WHICH RESULTED IN COMBINED PAYMENTS OF LESS THAN THE INTENDED 55 PERCENT WAS NOT PERMITTED.

COLONEL STEBBINS SUGGESTED THAT THE HOLDING IN THAT DECISION SHOULD ALSO APPLY TO THE SITUATION IN WHICH, PRIOR TO ATTAINING THE AGE OF FULL ELIGIBILITY, A SURVIVING SPOUSE (INSTEAD OF THE MILITARY RETIREE) ELECTS TO RECEIVE REDUCED SOCIAL SECURITY BENEFITS. IF SUCH A REDUCTION IN SOCIAL SECURITY BENEFITS IS NOT RECOGNIZED BY THE DEPARTMENT OF DEFENSE, THE REDUCTION OF THE SURVIVOR ANNUITY ON ACCOUNT OF SUCH BENEFITS WILL BE LARGER THAN THE SOCIAL SECURITY BENEFITS RECEIVED.

THE HOLDING IN MATTER OF LAMBERT IS BASED ON THE PROVISIONS OF 10 U.S.C. SEC. 1451, WHICH GOVERN THE AMOUNT OF THE SURVIVOR BENEFIT PLAN ANNUITY PAYABLE TO A SURVIVING SPOUSE OR DEPENDENT CHILD. SECTION 1451(A)(3) REQUIRES THAT WHEN THE SURVIVING SPOUSE ATTAINS AGE 62, THE MONTHLY SURVIVOR BENEFIT PLAN ANNUITY IS TO BE "REDUCED BY AN AMOUNT EQUAL TO THE AMOUNT OF" THE SOCIAL SECURITY BENEFITS TO WHICH THE SURVIVING SPOUSE IS ENTITLED, BASED ON THE MEMBER'S MILITARY SERVICE. IN MATTER OF LAMBERT, WE STATED

"*** THE LEGISLATIVE HISTORY OF THE SURVIVOR BENEFIT PLAN SHOWS THAT THE OFF-SET WAS INTENDED TO BE THE EQUIVALENT OF THE SOCIAL SECURITY PAYMENT ***."

JUST AS THE SURVIVING SPOUSE'S SOCIAL SECURITY ANNUITY IS REDUCED AS A RESULT OF THE MEMBER'S ELECTION TO RECEIVE BENEFITS PRIOR TO FULL ELIGIBILITY AGE, UNDER 42 U.S.C. SEC. 402(Q)(1)(D) THE SURVIVING SPOUSE'S ANNUITY IS ALSO REDUCED IF HE OR SHE ELECTS TO DRAW BENEFITS BEFORE ATTAINING AGE 62. IT WOULD SEEM THAT REGARDLESS OF WHETHER THE SOCIAL SECURITY ANNUITY IS REDUCED ON ACCOUNT OF THE EARLY ELECTION OF BENEFITS BY THE MILITARY RETIREE OR BY THE SURVIVING SPOUSE, THE SURVIVOR BENEFIT ANNUITY OF THE SURVIVING SPOUSE SHOULD TAKE INTO ACCOUNT THE ACTUAL AMOUNT OF THE SOCIAL SECURITY ANNUITY RECEIVED.

WITHOUT A SPECIFIC CLAIM OR A SUBMISSION OF THE PROBLEM BY THE DEPARTMENT OF DEFENSE GIVING A FULL ANALYSIS OF THE SITUATION, WE DO NOT FIND THAT A FINAL ANSWER TO THE QUESTION IS APPROPRIATE.

HOWEVER, IT MAY BE THAT A CHANGE IN THE STATUTE IS NOT REQUIRED TO ACCOMPLISH COLONEL STEBBINS' PURPOSE. WE WOULD SUGGEST THAT IF HE WISHES TO PURSUE THIS MATTER FURTHER HE SHOULD DO SO THROUGH THE DEPARTMENT OF DEFENSE. IN THAT MANNER THE DEPARTMENT AND, IF NECESSARY, OUR OFFICE WILL BE ABLE TO CONSIDER FULLY THE QUESTION PRESENTED.