B-3435, MAY 12, 1939, 18 COMP. GEN. 845

B-3435: May 12, 1939

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PROVIDING FOR CONTINUANCE OF SUCH DEDUCTIONS ON THE HIGHER SALARY RATE AS SPECIFIED THEREIN WHEN APPOINTMENT IS MADE IN THE DEPARTMENT OF STATE AT A LOWER BASIC SALARY. IS EFFECTIVE PROSPECTIVELY AND DOES NOT REQUIRE RETROACTIVE DEDUCTIONS IN THE CASE OF SUCH APPOINTMENTS PRIOR TO THE EFFECTIVE DATE OF THE ACT. THE SAID HIGHER SALARY WILL FROM THE DATE OF THE ACT BE THE BASIC SALARY RATE FOR ALL PURPOSES OF SECTION 26. ARE SEPARATE AND DISTINCT. IS NOT ENTITLED THEREAFTER TO THE FULL ANNUITY TO WHICH HE WOULD HAVE BEEN ENTITLED HAD HE ORIGINALLY ELECTED A DEFERRED ANNUITY AT AGE 60. THE TERM "MAJOR FRACTION" OF A MONTH IS TO BE CONSIDERED AS 16 DAYS WHERE THE MONTH CONTAINS 30 OR 31 DAYS.

B-3435, MAY 12, 1939, 18 COMP. GEN. 845

RETIREMENT - FOREIGN SERVICE - AMENDATORY ACT INTERPRETATIONS SECTION 26 OF THE FOREIGN SERVICE CLASSIFICATION, ETC. ACT OF FEBRUARY 23, 1931, 46 STAT. 1211, AS AMENDED BY SECTION 3 OF PUBLIC, NO. 40, APPROVED APRIL 24, 1939, 53 STAT. 583, ESTABLISHING A 5-PERCENT DEDUCTION FROM THE BASIC SALARY OF ALL FOREIGN SERVICE OFFICERS ELIGIBLE FOR RETIREMENT, AND PROVIDING FOR CONTINUANCE OF SUCH DEDUCTIONS ON THE HIGHER SALARY RATE AS SPECIFIED THEREIN WHEN APPOINTMENT IS MADE IN THE DEPARTMENT OF STATE AT A LOWER BASIC SALARY, IS EFFECTIVE PROSPECTIVELY AND DOES NOT REQUIRE RETROACTIVE DEDUCTIONS IN THE CASE OF SUCH APPOINTMENTS PRIOR TO THE EFFECTIVE DATE OF THE ACT, BUT THE SAID HIGHER SALARY WILL FROM THE DATE OF THE ACT BE THE BASIC SALARY RATE FOR ALL PURPOSES OF SECTION 26, AS AMENDED, INCLUDING COMPUTATIONS FOR OPTIONAL ADDITIONAL DEPOSITS IN THE RETIREMENT FUND. THE PROVISION FOR 5-PERCENT MANDATORY CONTRIBUTION TO BE DEDUCTED FROM THE BASIC SALARY, AND THE PROVISION FOR OPTIONAL DEPOSITS OF ADDITIONAL SUMS IN THE RETIREMENT FUND NOT TO EXCEED 10 PERCENT OF THE BASIC SALARY, APPEARING IN SECTION 26 OF THE FOREIGN SERVICE CLASSIFICATION, ETC. ACT OF FEBRUARY 23, 1931, 46 STAT. 1211, AS AMENDED BY SECTION 3 OF PUBLIC, NO. 40, APPROVED APRIL 24, 1939, 53 STAT. 583, ARE SEPARATE AND DISTINCT, AND THE OPTIONAL DEPOSITS MAY BE 10 PERCENT IN ADDITION TO THE 5-PERCENT MANDATORY DEDUCTION AND NEED NOT BE SO LIMITED THAT THE TOTAL OF BOTH THE MANDATORY AND OPTIONAL DEDUCTIONS DOES NOT EXCEED 10 PERCENT. AN OFFICER WHO RETIRES UNDER AGE 60 AND WHO ELECTS UNDER PARAGRAPH (D) OF SECTION 26 OF THE FOREIGN SERVICE CLASSIFICATION, ETC. ACT OF FEBRUARY 23, 1931, 46 STAT. 1211, AS AMENDED BY SECTION 3 OF PUBLIC, NO. 40, APPROVED APRIL 24, 1939, 53 STAT. 583, TO RECEIVE AN IMMEDIATE ANNUITY REDUCED AS PROVIDED BY THE ACT BELOW THAT OF A DEFERRED ANNUITY BEGINNING AT AGE 60, CONTINUES IN RECEIPT OF THE REDUCED ANNUITY AFTER ATTAINING THE AGE OF 60, AND IS NOT ENTITLED THEREAFTER TO THE FULL ANNUITY TO WHICH HE WOULD HAVE BEEN ENTITLED HAD HE ORIGINALLY ELECTED A DEFERRED ANNUITY AT AGE 60. IN CARRYING OUT THE PROVISION IN PARAGRAPH (D) OF SECTION 26 OF THE FOREIGN SERVICE CLASSIFICATION, ETC. ACT OF FEBRUARY 23, 1931, 46 STAT. 1211, AS AMENDED BY SECTION 3 OF PUBLIC, NO. 40, APPROVED APRIL 24, 1939, 53 STAT. 583, REQUIRING REDUCTION OF ANNUITY, WHERE AN OFFICER RETIRES UNDER AGE 60 AND ELECTS TO RECEIVE AN IMMEDIATE ANNUITY RATHER THAN AN ANNUITY DEFERRED TO AGE 60,"FOR EACH MONTH OR MAJOR FRACTION THEREOF," BETWEEN THE DATE OF RETIREMENT AND THE SIXTIETH BIRTHDAY, THE TERM "MAJOR FRACTION" OF A MONTH IS TO BE CONSIDERED AS 16 DAYS WHERE THE MONTH CONTAINS 30 OR 31 DAYS, AND 15 DAYS FOR THE MONTH OF FEBRUARY CONTAINING 28 OR 29 DAYS. FRACTIONAL YEAR'S SERVICE MAY NOT BE INCLUDED IN COMPUTING ANNUITIES UNDER SECTION 26 (E) OF THE FOREIGN SERVICE CLASSIFICATION, ETC. ACT OF FEBRUARY 23, 1931, 46 STAT. 1211, AS AMENDED BY SECTION 3 OF PUBLIC, NO. 40, APPROVED APRIL 24, 1939, 53 STAT. 583. THE WORDS "BY MORE THAN EIGHT YEARS" APPEARING IN SECTION 26 (E) OF THE FOREIGN SERVICE CLASSIFICATION, ETC. ACT OF FEBRUARY 23, 1931, 46 STAT. 1211, AS AMENDED, BY SECTION 3 OF PUBLIC, NO. 40, APPROVED APRIL 24, 1939, 53 STAT. 583, IN REGARD TO THE REDUCTION TO BE MADE IN A RETIRED OFFICER'S ANNUITY WHERE HE ELECTS A JOINT AND SURVIVORSHIP ANNUITY AND HIS AGE "EXCEEDS THE AGE OF THE WIFE BY MORE THAN EIGHT YEARS," MAY NOT BE CONSTRUED AS AUTHORIZING A DISREGARDING OF THE FURTHER ANNUITY REDUCTION REQUIRED BY THE ACT UNTIL THE AGE DIFFERENCE IS 9 YEARS OR MORE, BUT REQUIRES THE SAID ADDITIONAL DEDUCTION AS SOON AS THE AGE DIFFERENCE EXCEEDS 8 YEARS, EVEN IF BY ONLY 1 DAY. IF AN OFFICER WHO ELECTS A REDUCED JOINT AND SURVIVORSHIP ANNUITY UNDER SECTION 26 (E) OF THE FOREIGN SERVICE CLASSIFICATION, ETC. ACT OF FEBRUARY 23, 1931, 46 STAT. 1211, AS AMENDED BY SECTION 3 OF PUBLIC, NO. 40, APPROVED APRIL 24, 1939, 53 STAT. 583, IS PREDECEASED BY HIS WIFE PRIOR TO HIS RETIREMENT THE ELECTION IS VOIDED, BUT IF THE WIFE'S DEATH OCCURS AFTER THE OFFICER'S RETIREMENT HE IS ENTITLED TO A CONTINUANCE ONLY OF THE REDUCED ANNUITY ON HIS BEHALF AND NOT A FULL ANNUITY AS THOUGH A REDUCED ANNUITY HAD NOT ORIGINALLY BEEN ELECTED, BUT UPON THE DEATH OF THE OFFICER THE EXCESS OF THE ACCUMULATED CONTRIBUTIONS OVER ANNUITY PAYMENTS, IF ANY, ARE FOR REFUND AS PROVIDED BY SECTION 26 (I) OF THE ACT. UNDER SECTION 26 (E) OF THE FOREIGN SERVICE CLASSIFICATION ETC. ACT OF FEBRUARY 23, 1931, 46 STAT. 1211, AS AMENDED BY SECTION 3 OF PUBLIC, NO. 40, APPROVED APRIL 24, 1939, 53 STAT. 583, ANNUITIES OF PREVIOUSLY RETIRED OFFICERS MAY BE RECOMPUTED AND THE INCREASES PAID THEREUNDER EFFECTIVE UPON THE EFFECTIVE DATE OF THE LATTER ACT--- JULY 1, 1939--- AND THE SUBSEQUENT ELECTION OF A REDUCED JOINT AND SURVIVORSHIP ANNUITY WITH HIS WIFE IN THE MANNER AS OUTLINED IN THE SAID SECTION DOES NOT REQUIRE A RETROACTIVE REDUCTION OF THE INCREASED PAYMENTS MADE PRIOR TO THE EFFECTIVE DATE OF THE JOINT AND SURVIVORSHIP ANNUITY. THE PORTION OF SECTION 33 OF THE FOREIGN SERVICE CLASSIFICATION, ETC. ACT OF FEBRUARY 23, 1931, 46 STAT. 1215, AS AMENDED BY SECTION 4 OF PUBLIC, NO. 40, APPROVED APRIL 24, 1939, 53 STAT. 583, WHICH PROVIDES THAT IF AN OFFICER HAS NOT SERVED AT LEAST 15 YEARS HE SHALL HAVE RETURNED TO HIM THE CONTRIBUTIONS TO THE ANNUITY FUND WITH INTEREST THEREON AT 4 PERCENT COMPOUNDED NUALLY,"EXCEPT AS PROVIDED IN PARAGRAPH (C) OF SECTION 4 OF THIS ACT" MAY, BY REASON OF AN EVIDENT ERROR IN CROSS REFERENCE, BE CONSIDERED AS HAVING REFERENCE TO PARAGRAPH (C) OF SECTION 3 OF THE LATTER ACT. EXISTING REGULATIONS PROMULGATED BY THE PRESIDENT UNDER THE PROVISIONS OF THE FOREIGN SERVICE CLASSIFICATION, ETC. ACT OF FEBRUARY 23, 1931, 46 STAT. 1207, WHICH HAVE BEEN REENACTED WITHOUT CHANGE, AND NOT IN CONFLICT WITH THE PROVISIONS OF THE AMENDING ACT OF APRIL 24, 1939, PUBLIC, NO. 40, 53 STAT. 583, REMAIN IN FULL FORCE AND EFFECT UNTIL SUPERSEDED OR REVOKED.

COMPTROLLER GENERAL BROWN TO THE SECRETARY OF STATE, MAY 12, 1939:

I HAVE YOUR TWO LETTERS OF MAY 1, 1939 (REF.FA), AS FOLLOWS:

BY THE ACT APPROVED APRIL 24, 1939, PUBLIC, NO. 40, 76TH CONGRESS, CHAPTER 84, 1ST SESSION, ENTITLED "AN ACT TO AMEND THE ACT ENTITLED "AN ACT FOR THE GRADING AND CLASSIFICATION OF CLERKS IN THE FOREIGN SERVICE OF THE UNITED STATES OF AMERICA, AND PROVIDING COMPENSATION THEREFOR," APPROVED FEBRUARY 23, 1931," CERTAIN AMENDMENTS ARE MADE TO SECTIONS 3, 10, 26, AND 33 OF THE ACT OF FEBRUARY 23, 1931. TWO COPIES OF THE ACT OF APRIL 24, 1939, ARE ENCLOSED AND THE FOLLOWING QUESTIONS WHICH HAVE BEEN RAISED IN CONNECTION WITH THESE AMENDMENTS ARE PRESENTED TO YOU FOR DETERMINATION:

SECTION 3, AMENDING SECTION 26 OF THE ACT OF FEBRUARY 23, 1931

SECTION 3 OF THE ACT OF APRIL 24, 1939, IS A REVISION OF SECTION 26 OF THE ACT OF FEBRUARY 23, 1931, WHICH ESTABLISHES THE FOREIGN SERVICE RETIREMENT AND DISABILITY SYSTEM.

1. PARAGRAPH (C/--- POINT 1.

PARAGRAPH (C) OF SECTION 26 ESTABLISHES A FIVE PERCENTUM DEDUCTION FROM THE BASIC SALARY OF ALL FOREIGN SERVICE OFFICERS ELIGIBLE TO RETIREMENT, AND PROVIDES FURTHER

"* * * THAT ALL BASIC SALARIES IN EXCESS OF $10,000 PER ANNUM SHALL BE TREATED AS $10,000 AND ANY AMBASSADOR, MINISTER, OR FOREIGN SERVICE OFFICER APPOINTED TO A POSITION IN THE DEPARTMENT OF STATE, AS PROVIDED IN PARAGRAPH (N) OF THIS SECTION, AT A LOWER BASIC SALARY THAN HE WAS RECEIVING ON THE DATE OF SUCH APPOINTMENT SHALL BE CONSIDERED FOR ALL PURPOSES OF THIS SECTION AS CONTINUING TO DRAW THE HIGHER SALARY AND SALARY DEDUCTIONS AUTHORIZED UNDER THIS PARAGRAPH SHALL BE ON THAT BASIS:

SHALL THE PROVISIONS OF PARAGRAPH (C) OF SECTION 26, AS QUOTED BE HELD TO APPLY RETROACTIVELY, WITH A REQUIREMENT THAT DEDUCTIONS ON THE BASIS AUTHORIZED SHALL LIKEWISE BE MADE RETROACTIVELY TO DATE OF APPOINTMENT TO A POSITION IN THE DEPARTMENT OF STATE IN THE CASE OF AN AMBASSADOR, MINISTER, OR FOREIGN SERVICE OFFICER WHO WAS APPOINTED TO SUCH A POSITION PRIOR TO THE EFFECTIVE DATE OF THE AMENDED ACT?

2. PARAGRAPH (C/--- POINT 2.

FURTHER INQUIRY IS MADE WHETHER YOU CONCUR IN THE DEPARTMENT'S VIEW THAT SINCE ACCORDING TO PARAGRAPH (C) OF SECTION 26, THE BASIC SALARY OF AN OFFICER TRANSFERRED FROM THE FOREIGN SERVICE TO A POSITION IN THE DEPARTMENT OF STATE AT A LOWER BASIC SALARY IS FOR ALL PURPOSES OF THE LEGISLATION TO BE CONSIDERED THE HIGHER SALARY PREVIOUSLY PAID, THE SPECIAL DEPOSITS IN MULTIPLES OF 1 PERCENTUM FOR WHICH PERMISSION IS ACCORDED WILL LIKEWISE BE COMPUTED ON SUCH HIGHER SALARY.

3. PARAGRAPH (C/--- POINT 3.

IN THAT PART OF PARAGRAPH (C) OF SECTION 26 WHEREIN IT IS PROVIDED THAT ANY FOREIGN SERVICE OFFICER MAY AT HIS OPTION DEPOSIT ADDITIONAL SUMS IN MULTIPLES OF 1 PERCENTUM OF HIS BASIC SALARY BUT NOT TO EXCEED 10 PERCENTUM OF SUCH BASIC SALARY, DOES THIS MEAN THAT THE MANDATORY 5 PERCENTUM CONTRIBUTION AND SUCH ADDITIONAL DEPOSITS AS AN OFFICER MAY ELECT TO MAKE SHALL NOT EXCEED 10 PERCENTUM OF AN OFFICER'S BASIC SALARY, OR DOES IT MEAN THAT DEPOSITS MAY BE MADE UP TO 10 PERCENTUM OF THE BASIC SALARY IN ADDITION TO THE MANDATORY 5 PERCENTUM CONTRIBUTION?

4. PARAGRAPH (D).

IN PARAGRAPH (D) OF SECTION 26 IT IS PROVIDED, IN PART, THAT AN OFFICER BELOW THE AGE OF 60 YEARS WHO HAS RENDERED AT LEAST THIRTY YEARS OF ACTUAL SERVICE, EXCLUSIVE OF EXTRA SERVICE CREDITS FOR SERVICE AT UNHEALTHFUL POSTS AS PROVIDED IN PARAGRAPH (K), MAY BE RETIRED AT HIS OWN REQUEST AND ELECT TO RECEIVE (1) A DEFERRED ANNUITY BEGINNING AT AGE 60, COMPUTED AS PRESCRIBED UNDER PARAGRAPH (E) OF SECTION 26; OR (2) AN IMMEDIATE ANNUITY COMPUTED AS PRESCRIBED UNDER PARAGRAPH (E), REDUCED BY ONE-FOURTH OF 1 PERCENTUM OF SUCH ANNUITY FOR EACH MONTH OR MAJOR FRACTION THEREOF, BETWEEN THE DATE OF HIS RETIREMENT AND THE SIXTIETH ANNIVERSARY OF HIS DATE OF BIRTH.

TWO QUESTIONS ARE RAISED IN THIS CONNECTION: FIRST, WHEN AN OFFICER WHO RETIRES UNDER AGE 60 AND ELECTS TO RECEIVE AN IMMEDIATE ANNUITY, REDUCED AS PROVIDED, ATTAINS THE AGE OF 60, IS THE ASSUMPTION CORRECT THAT SUCH OFFICER SHALL CONTINUE TO RECEIVE THE REDUCED ANNUITY, AND SHALL NOT BE ENTITLED UPON ATTAINING AGE 60 TO THE FULL ANNUITY TO WHICH HE WOULD HAVE BEEN ENTITLED HAD HE ELECTED A DEFERRED ANNUITY AT AGE 60? SECOND, IN THE CASE OF AN OFFICER RETIRING UNDER THESE CIRCUMSTANCES, WHERE THE LAW SETS FORTH THE PRINCIPLE FOR THE REDUCTION OF THE ANNUITY AND STATUS "FOR EACH MONTH OR MAJOR FRACTION THEREOF," IS THE ASSUMPTION CORRECT THAT A "MAJOR FRACTION" OF A MONTH SHALL BE 16 DAYS OR OVER AND THUS SHALL BE COUNTED AS A WHOLE MONTH?

5. PARAGRAPH (E/--- POINT 1.

IN PARAGRAPH (E) OF SECTION 26 IT IS PROVIDED IN PART THAT---

"THE ANNUITY OF A RETIRED FOREIGN SERVICE OFFICER SHALL BE EQUAL TO 2 PERCENTUM OF HIS AVERAGE ANNUAL BASIC SALARY FOR THE TEN YEARS NEXT PRECEDING THE DATE OF RETIREMENT MULTIPLIED BY THE NUMBER OF YEARS OF SERVICE NOT EXCEEDING THIRTY YEARS: * * *"

IN THE COMPUTATION OF AN ANNUITY UNDER THESE PROVISIONS, SHALL THE "NUMBER OF YEARS OF SERVICE NOT EXCEEDING THIRTY YEARS" BE CONSIDERED TO BE FULL YEARS ONLY, WITH FRACTIONAL YEARS DISREGARDED, OR SHALL IT BE CONSIDERED TO BE AN OFFICER'S FULL PERIOD OF SERVICE, INCLUDING YEARS, MONTHS, AND DAYS, NOT TO EXCEED A TOTAL PERIOD OF 30 YEARS? THE FOLLOWING CASES WILL ILLUSTRATE THE RESPECTIVE ANNUITY BENEFITS IN EACH INSTANCE:

OFFICER A RETIRED FOR AGE ON SEPTEMBER 30, 1932, UNDER THE PROVISIONS OF SECTION 26 (D) OF THE ACT OF FEBRUARY 23, 1931. HIS ACTUAL SERVICE AT TIME OF RETIREMENT TOTALED 26 YEARS 5 MONTHS AND 1 DAY. HIS ANNUITY WAS COMPUTED UNDER THE PROVISIONS OF SECTION 26 (E) OF THE ACT OF FEBRUARY 23, 1931, TO BE $4,171.18. IN RECALCULATING THE ANNUITY OF OFFICER A IN ACCORDANCE WITH THE PROVISIONS OF SECTION 26 (E) AS AMENDED BY THE ACT OF APRIL 24, 1939, ON THE ASSUMPTION THAT FULL YEARS SHALL BE COUNTED AND FRACTIONAL YEARS DISREGARDED, THE COMPUTATION OF THE ANNUITY WOULD BE AS FOLLOWS:

TABLE

AVERAGE ANNUAL BASIC SALARY FOR 10 YEARS NEXT PRECEDING

RETIREMENT -------------------------------------------- $9,000.00

2 PERCENT OF AVERAGE ANNUAL BASIC SALARY FOR 10 YEARS NEXT

PRECEDING RETIREMENT ---------------------------------- 180.00

MULTIPLIED BY 26 YEARS OF SERVICE ----------------------- 4,680.00

IF FRACTIONAL YEARS ARE INCLUDED IN THE SERVICE, THE ANNUITY OF OFFICER A WOULD BE COMPUTED AS FOLLOWS:

TABLE

AVERAGE ANNUAL BASIC SALARY FOR 10 YEARS NEXT PRECEDING

RETIREMENT -------------------------------------------- $9,000.00

2 PERCENT OF AVERAGE ANNUAL BASIC SALARY FOR 10 YEARS

NEXT PRECEDING RETIREMENT ----------------------------- 180.00

MULTIPLIED BY 26 YEARS 5 MONTHS AND 1 DAY OF SERVICE ---- 4,755.50

IN OTHER WORDS, IF OFFICER A IS GIVEN CREDIT FOR 26 YEARS OF SERVICE, HIS ANNUITY WILL BE $4,680, WHEREAS IF HE IS GIVEN CREDIT FOR HIS FULL PERIOD OF SERVICE OF 26 YEARS 5 MONTHS AND 1 DAY, HIS ANNUITY WILL BE $4,755.50.

OFFICER B RETIRED FOR DISABILITY ON JUNE 30, 1935, UNDER THE PROVISIONS OF SECTION 26 (J) OF THE ACT OF FEBRUARY 23, 1931. HIS ACTUAL SERVICE AT TIME OF RETIREMENT TOTALED 21 YEARS 1 MONTH AND 22 DAYS AND HIS EXTRA SERVICE CREDITS FOR SERVICE AT UNHEALTHFUL POSTS ALLOWED UNDER PARAGRAPH (K) OF THE ACT OF FEBRUARY 23, 1931, AMOUNTED TO 3 YEARS 6 MONTHS AND 15 DAYS, MAKING A TOTAL SERVICE OF 24 YEARS 8 MONTHS AND 7 DAYS. HIS ANNUITY WAS COMPUTED UNDER THE PROVISIONS OF PARAGRAPH (E) OF SECTION 26 OF THE ACT OF FEBRUARY 23, 1931, TO BE $3,506.56. IN RECALCULATING THE ANNUITY OF OFFICER B IN ACCORDANCE WITH THE PROVISIONS OF SECTION 26 (E) AS AMENDED BY THE ACT OF APRIL 24, 1939, THE COMPUTATION OF THE ANNUITY WOULD BE AS FOLLOWS, TAKING AS A BASIS FULL YEARS OF SERVICE AND DISREGARDING FRACTIONAL YEARS:

TABLE

AVERAGE ANNUAL BASIC SALARY FOR 10 YEARS NEXT PRECEDING

RETIREMENT --------------------------------------------- $7,513.61

2 PERCENT OF AVERAGE ANNUAL BASIC SALARY FOR 10 YEARS

NEXT PRECEDING RETIREMENT ------------------------------ 150.2722

MULTIPLIED BY 24 YEARS OF SERVICE ------------------------ 3,606.53

IF FRACTIONAL YEARS ARE INCLUDED IN THE SERVICE, THE ANNUITY OF OFFICER B WOULD BE COMPUTED AS FOLLOWS:

TABLE

AVERAGE ANNUAL BASIC SALARY FOR 10 YEARS NEXT PRECEDING

RETIREMENT --------------------------------------------- $7,513.61

2 PERCENT OF AVERAGE ANNUAL BASIC SALARY FOR 10 YEARS

NEXT PRECEDING RETIREMENT ------------------------------ 150.2722

MULTIPLIED BY 24 YEARS 8 MONTHS AND 7 DAYS OF SERVICE ---- 3,709.64

IN OTHER WORDS, IF OFFICER B IS GIVEN CREDIT FOR 24 YEARS OF SERVICE, HIS ANNUITY WILL BE $3,606.53, WHEREAS IF HE IS GIVEN CREDIT FOR HIS FULL PERIOD OF SERVICE OF 24 YEARS 8 MONTHS AND 7 DAYS, HIS ANNUITY WILL BE $3,709.64.

6. PARAGRAPH (E/--- POINT 2.

IN PARAGRAPH (E) OF SECTION 26, WHEREIN IT IS PROVIDED THAT A FOREIGN SERVICE OFFICER MAY UNDER CERTAIN CONDITIONS ELECT TO RECEIVE A REDUCED JOINT AND SURVIVORSHIP ANNUITY, IT IS PROVIDED FURTHER THAT- -

"* * * IF THE AGE OF THE OFFICER IS LESS THAN THE AGE OF THE WIFE OR EXCEEDS HER AGE BY NOT MORE THAN EIGHT YEARS, THE ANNUITY OF THE OFFICER WILL BE REDUCED BY AN AMOUNT EQUAL TO ONE-HALF THE ANNUITY WHICH HE ELECTS TO HAVE PAID TO HIS WIDOW. IF THE AGE OF THE OFFICER EXCEEDS THE AGE OF THE WIFE BY MORE THAN EIGHT YEARS, THE ANNUITY OF THE OFFICER WILL BE REDUCED BY AN AMOUNT EQUAL TO ONE-HALF THE ANNUITY WHICH HE ELECTS TO HAVE PAID TO HIS WIDOW PLUS AN ADDITIONAL REDUCTION EQUAL TO 2 PERCENTUM OF SUCH WIDOW'S ANNUITY FOR EACH YEAR, OR FRACTION THEREOF, THAT THE DIFFERENCE IN AGE EXCEEDS EIGHT: * * *"

IN THIS PROVISION OF THE LAW DOES THE TERM "EIGHT YEARS" MEAN UP TO NINE YEARS; THAT IS, DO THE WORDS "MORE THAN" IMPLY THAT FRACTIONS OVER AND ABOVE A FLAT EIGHT YEARS ARE TO BE DISREGARDED UNTIL THE DIFFERENCE IS NINE YEARS OR MORE?

7. PARAGRAPH (E/--- POINT 3.

IN THE EVENT THAT AN OFFICER WHO ELECTS A REDUCED JOINT AND SURVIVORSHIP ANNUITY IS PREDECEASED BY HIS WIFE, IS THE ASSUMPTION CORRECT THAT THE ELECTION WOULD BE VOIDED BY THE WIFE'S DEATH AT ANY TIME PRIOR TO THE OFFICER'S RETIREMENT, BUT IF THE WIFE'S DEATH SHOULD OCCUR AFTER RETIREMENT, THE OFFICER WOULD RECEIVE THE REDUCED ANNUITY WHICH HE HAD ELECTED AND WOULD NOT BE ENTITLED TO CLAIM FULL ANNUITY BY REASON OF THE DEATH OF HIS WIFE AFTER RETIREMENT? IN THE EVENT, HOWEVER, THAT A RETIRED OFFICER IS PREDECEASED BY HIS WIFE, IS THE ASSUMPTION CORRECT THAT UPON THE DEATH OF THE OFFICER THE EXCESS OF THE ACCUMULATED CONTRIBUTIONS OVER ANNUITY PAYMENTS, IF ANY, WOULD THEN BE RETURNED AS PROVIDED IN PARAGRAPH (I) OF SECTION 26?

8. PARAGRAPH (E/--- POINT 4.

IN PARAGRAPH (E) OF SECTION 26 IT IS PROVIDED FURTHER THAT AN OFFICER NOW RETIRED AND RECEIVING AN ANNUITY UNDER THE ACT OF FEBRUARY 23, 1931, MAY ELECT A REDUCED JOINT AND SURVIVORSHIP ANNUITY, UNDER CERTAIN CONDITIONS, PROVIDED THAT ALL SUCH ELECTIONS SHALL BE MADE WITHIN SIX MONTHS FOLLOWING THE EFFECTIVE DATE OF THE ACT, AND THAT THEY SHALL ALL BE EFFECTIVE ON THE SAME DATE, TO BE PRESCRIBED BY THE PRESIDENT. UNDER THIS PROVISION, THE ANNUITIES OF ALL RETIRED FOREIGN SERVICE OFFICERS WILL BE RECALCULATED IN ACCORDANCE WITH THE PRINCIPLES SET FORTH IN PARAGRAPH (E) OF THE ACT OF APRIL 24, 1939, AND THE REVISED ANNUITIES SHALL BE EFFECTIVE ON THE EFFECTIVE DATE OF THE ACT, WHICH, ACCORDING TO SECTION 5, WILL BE JULY 1, 1939. WITHIN SIX MONTHS OF THAT DATE AN OFFICER MAY ELECT A REDUCED JOINT AND SURVIVORSHIP ANNUITY, WHICH IN ALL CASES SHALL COMMENCE ON A DAY TO BE PRESCRIBED BY THE PRESIDENT. WILL A RETIRED OFFICER DRAW THE FULL ANNUITY TO WHICH HE IS ENTITLED AS PROVIDED IN THE NEW ACT FROM JULY 1, 1939, AND WILL THE REDUCTION IN ANNUITY, IF ELECTED, BE RETROACTIVE TO THE EFFECTIVE DATE OF THIS ACT, OR COMMENCE ON THE DAY TO BE PRESCRIBED BY THE PRESIDENT?

SECTION 4, AMENDING SECTION 33 OF THE ACT OF FEBRUARY 23, 1931

SECTION 4 OF THE ACT OF APRIL 24, 1939, AMENDS SECTION 33 OF THE ACT OF FEBRUARY 23, 1931.

9. YOUR ATTENTION IS INVITED TO THAT PORTION OF SECTION 33, AS AMENDED, WHEREIN IT IS STATED THAT AN OFFICER "SHALL, HOWEVER, IF HE HAS NOT SERVED AT LEAST FIFTEEN YEARS, HAVE RETURNED TO HIM THE FULL SUM OF HIS CONTRIBUTIONS TO THE ANNUITY FUND, WITH INTEREST THEREON AT 4 PERCENTUM COMPOUNDED ANNUALLY, EXCEPT AS PROVIDED IN PARAGRAPH (C) OF SECTION 4 OF THIS ACT.' AS THERE IS NO "PARAGRAPH (C) OF SECTION 4" IN THE ACT OF APRIL 24, 1939, IT IS OBVIOUS THAT THIS CROSS-REFERENCE SHOULD BE TO PARAGRAPH (C) OF SECTION 3, THE PENULTIMATE SENTENCE OF WHICH READS AS FOLLOWS:

"IN CASE AN OFFICER SHALL BECOME SEPARATED FROM THE SERVICE FOR ANY REASON EXCEPT RETIREMENT ON AN ANNUITY, THE AMOUNT OF ANY ADDITIONAL DEPOSITS WITH INTEREST AT 3 PERCENTUM PER ANNUM COMPOUNDED ANNUALLY, MADE BY HIM UNDER THE PROVISIONS OF THIS PARAGRAPH SHALL BE REFUNDED IN THE MANNER PROVIDED ELSEWHERE IN THIS SECTION FOR THE RETURN OF CONTRIBUTIONS AND INTEREST IN THE CASE OF DEATH OR WITHDRAWAL FROM ACTIVE SERVICE.' THIS DEFECTIVE CROSS-REFERENCE, AS SHOWN BY THE ENCLOSED HOUSE DOCUMENT NO. 146, IS THE RESULT OF THE RENUMBERING OF THE SECTIONS OF THE BILL DURING THE COURSE OF ITS ENACTMENT BY THE CONGRESS, WITHOUT MAKING AN APPROPRIATE CHANGE IN THE CROSS REFERENCE. HOWEVER, IN VIEW OF THE SPECIFIC PROVISION OF SECTION 3 (C), QUOTED ABOVE, IT IS BELIEVED THAT AN OFFICER SEPARATED FROM THE SERVICE UNDER THE PROVISIONS OF SECTION 33 WITH LESS THAN FIFTEEN YEARS' SERVICE WOULD HAVE RETURNED TO HIM HIS COMPULSORY CONTRIBUTIONS (5 PERCENTUM OF BASIC SALARY) WITH INTEREST AT 4 PERCENTUM COMPOUNDED ANNUALLY AND HIS ADDITIONAL OPTIONAL CONTRIBUTIONS WOULD BE RETURNED WITH INTEREST AT 3 PERCENTUM COMPOUNDED ANNUALLY. WILL YOU PLEASE INDICATE IF YOU ARE IN AGREEMENT WITH THIS STATEMENT? THE THE ERRONEOUS CROSS-REFERENCE SHOULD NEVERTHELESS BE CORRECTED BY LEGISLATION WHENEVER IT IS PRACTICABLE.

THERE ARE ENCLOSED TWO COPIES OF SENATE REPORT NO. 222 FOR YOUR INFORMATION IN CONNECTION WITH THE CONSIDERATION OF THE QUESTIONS PRESENTED IN THIS LETTER.

IN VIEW OF THE SHORTNESS OF TIME BETWEEN THE DATE OF APPROVAL AND THE EFFECTIVE DATE OF THIS ACT AND THE URGENT NATURE OF THE WORK INVOLVED IN PUTTING THE PROVISIONS OF THE ACT INTO ACTUAL OPERATION ON THE EFFECTIVE DATE, IT WILL BE APPRECIATED IF YOU WILL GIVE THE QUESTIONS RAISED IN THIS LETTER YOUR PROMPT ATTENTION AND EXPEDITE YOUR REPLY.

THERE IS ENCLOSED FOR YOUR CONVENIENCE IN CONSIDERING THE QUESTION HEREINAFTER SUBMITTED A COPY OF THE ACT OF APRIL 24, 1939 (PUBLIC NO. 40, 76TH CONGRESS) WHICH AMENDS CERTAIN PROVISIONS OF SECTIONS 3, 10, 26, AND 33 OF THE ACT OF FEBRUARY 23, 1931.

THE ACT OF APRIL 24, 1939, WILL BECOME EFFECTIVE ON JULY 1, 1939, AND IT WILL BE NECESSARY TO ESTABLISH BEFORE THAT DATE THE REGULATIONS REQUIRED BY THE NEW PROVISIONS OF THE LAW IN THE ACT. HOWEVER, THE ACT OF APRIL 24, 1939, MERELY REENACTS MANY OF THE PROVISIONS OF SECTIONS 3, 10, 26, AND 33 OF THE ACT OF FEBRUARY 23, 1931, AND IT IS DESIRED THAT EXISTING REGULATIONS IN THE FORM OF EXECUTIVE ORDERS BASED ON THE PROVISIONS OF THESE SECTIONS WHICH HAVE NOT BEEN AMENDED IN ANY WAY SHALL REMAIN IN EFFECT. COPIES OF EXECUTIVE ORDERS NOS. 5642 AND 5644 OF JUNE 8, 1931, NO. 6942 OF JANUARY 8, 1935, AND NO. 7062 OF JUNE 5, 1935, ARE ENCLOSED FOR YOUR INFORMATION, AND THE REGULATIONS BASED ON SECTIONS OF LAW IN QUESTION HAVE BEEN MARKED.

IT IS THE UNDERSTANDING OF THIS DEPARTMENT THAT THESE EXECUTIVE ORDERS BASED UPON LEGISLATION REENACTED WITHOUT CHANGE IN THE ACT OF APRIL 24, 1939, AND NOT IN CONFLICT THEREWITH WILL REMAIN IN FULL FORCE AND EFFECT UNTIL SUPERSEDED OR CANCELED. IT IS REQUESTED THAT YOU INFORM THIS DEPARTMENT WHETHER YOUR OFFICE IS IN ACCORD WITH THESE VIEWS.

DUE TO THE SHORTNESS OF TIME BEFORE THE ACT OF APRIL 24, 1939, GOES INTO EFFECT, A REPLY AT YOUR EARLIEST CONVENIENCE WILL BE APPRECIATED.

SECTION 5 OF THE ACT OF APRIL 24, 1939, PROVIDES AS FOLLOWS:

THIS ACT SHALL TAKE EFFECT ON THE FIRST DAY OF THE CALENDAR MONTH FOLLOWING THE EXPIRATION OF SIXTY DAYS FROM THE DATE OF ITS APPROVAL BY THE PRESIDENT.

THE PORTION OF PARAGRAPH (C) OF SECTION 26 OF THE ACT, AS AMENDED, QUOTED IN PARAGRAPH NO. 1 OF YOUR LETTER FIRST ABOVE QUOTED, IS NEW LEGISLATION AND DOES NOT BECOME EFFECTIVE UNTIL JULY 1, 1939, WHICH IS THE FIRST DAY OF THE CALENDAR MONTH FOLLOWING THE EXPIRATION OF 60 DAYS FROM APRIL 24, 1939, THE DATE OF THE APPROVAL OF THE ACT BY THE PRESIDENT. ACCORDINGLY, THE QUESTION IN PARAGRAPH NO. 1 IS ANSWERED IN THE NEGATIVE, THAT IS, THE BASIS FIXED BY THE STATUTE FOR MAKING RETIREMENT DEDUCTIONS FROM THE SALARY OF ANY AMBASSADOR, MINISTER, OR FOREIGN SERVICE OFFICER APPOINTED TO A POSITION IN THE DEPARTMENT OF STATE, DOES NOT BECOME EFFECTIVE UNTIL JULY 1, 1939.

REFERRING TO THE QUESTION IN PARAGRAPH NO. 2, THE NEW PORTION OF THE STATUTE QUOTED IN PARAGRAPH NO. 1 IS SPECIFICALLY APPLICABLE FOR "ALL PURPOSES OF THIS SECTION," THAT IS, SECTION 26 OF THE FOREIGN SERVICE RETIREMENT ACT OF FEBRUARY 23, 1931, 46 STAT. 1211, AS AMENDED BY SECTION 3 OF THE ACT OF APRIL 24, 1939. ACCORDINGLY, THE HIGHER SALARY RATE PAID TO AN AMBASSADOR, MINISTER, OR FOREIGN SERVICE OFFICER PRIOR TO AN APPOINTMENT TO A POSITION IN THE DEPARTMENT OF STATE WILL CONTINUE TO BE HIS BASIC SALARY RATE AFTER APPOINTMENT TO SUCH A POSITION FOR ALL PURPOSES OF SECTION 26 OF THE STATUTE, AS AMENDED, INCLUDING THE BASIS FOR COMPUTING OPTIONAL ADDITIONAL DEPOSITS IN THE RETIREMENT FUND IN MULTIPLES OF 1 PERCENTUM IN THE BASIC SALARY, THE AUTHORITY FOR WHICH APPEARS IN SUBSECTION (C) OF SECTION 26 OF THE ACT AS AMENDED.

SECTION 26 (C) OF THE FOREIGN SERVICE RETIREMENT ACT, AS AMENDED BY THE ACT OF APRIL 24, 1939, SO FAR AS MATERIAL TO AN ANSWER TO THE QUESTION IN PARAGRAPH NO. 3 OF YOUR LETTER, PROVIDES AS FOLLOWS:

FIVE PERCENTUM OF THE BASIC SALARY OF ALL FOREIGN SERVICE OFFICERS ELIGIBLE TO RETIREMENT SHALL BE CONTRIBUTED TO THE FOREIGN SERVICE RETIREMENT AND DISABILITY FUND, AND THE SECRETARY OF THE TREASURY IS DIRECTED ON THE DATE ON WHICH THIS ACT TAKES EFFECT TO CAUSE SUCH DEDUCTIONS TO BE MADE AND THE SUMS TRANSFERRED ON THE BOOKS OF THE TREASURY DEPARTMENT TO THE CREDIT OF THE FOREIGN SERVICE RETIREMENT AND DISABILITY FUND FOR THE PAYMENT OF ANNUITIES, REFUNDS, AND ALLOWANCES; * * * AND PROVIDED FURTHER, THAT ANY FOREIGN SERVICE OFFICER MAY AT HIS OPTION AND UNDER SUCH REGULATIONS AS MAY BE PRESCRIBED BY THE PRESIDENT, DEPOSIT ADDITIONAL SUMS IN MULTIPLES OF 1 PERCENTUM OF HIS BASIC SALARY, BUT NOT TO EXCEED 10 PERCENTUM OF SUCH BASIC SALARY, * * *

THE PROVISION FOR 5 PERCENT MANDATORY CONTRIBUTION TO BE DEDUCTED FROM THE BASIC SALARY AND THE PROVISION FOR OPTIONAL DEPOSITS OF ADDITIONAL SUMS IN THE RETIREMENT FUND, NOT TO EXCEED 10 PERCENT OF THE BASIC SALARY, ARE SEPARATE AND DISTINCT. THE INTENT APPEARS TO BE THAT NOT TO EXCEED 10 PERCENT OF THE BASIC SALARY MAY BE DEPOSITED IN THE RETIREMENT FUND AT THE OPTION OF THE OFFICER IN ADDITION TO THE MANDATORY CONTRIBUTION OF 5 PERCENT REQUIRED TO BE DEDUCTED FROM THE BASIC SALARY OF THE OFFICER.

THE FIRST QUESTION IN PARAGRAPH NO. 4 IS ANSWERED IN THE AFFIRMATIVE -- THE RATE OF AN ANNUITY BEING FIXED AS OF THE DATE OF RETIREMENT BASED UPON AGE AND LIFE EXPECTANCY AT THAT TIME.

REFERRING TO THE SECOND QUESTION IN PARAGRAPH NO. 4, PURSUANT TO THE PROVISIONS OF THE ACT OF APRIL 23, 1930, 46 STAT. 253, ALL RETIREMENTS ARE REQUIRED TO BE MADE EFFECTIVE ON THE FIRST DAY OF A MONTH, INCLUDING THOSE OF FOREIGN SERVICE OFFICERS WHO VOLUNTARILY RETIRE BEFORE REACHING THE AGE OF 60, UNDER THE PROVISIONS OF SECTION 26 (D) OF THE ACT, AS AMENDED. ACCORDINGLY, THE MAJOR FRACTION OF ANY MONTH, INCLUDING FEBRUARY, WOULD NECESSARILY BE COMPUTED FROM THE FIRST DAY OF THE MONTH, AND 16 DAYS IS THE MAJOR FRACTION OF ANY MONTH CONTAINING 30 OR 31 DAYS, BUT 15 DAYS IS THE MAJOR FRACTION OF FEBRUARY, CONTAINING 28 OR 29 DAYS. THERE IS NO AUTHORITY UNDER THIS STATUTE OR OTHERWISE FOR CONSIDERING EACH MONTH AS CONTAINING 30 DAYS FOR THE PURPOSES OF THE PARTICULAR PROVISION OF THE STATUTE UNDER CONSIDERATION, AS IS PROVIDED IN THE ACT OF JUNE 30, 1906, 34 STAT. 763, FOR THE PURPOSE OF COMPUTING SALARY PAYMENTS ON AN ANNUAL OR A MONTHLY BASIS.

SECTION 26 (E) OF THE FOREIGN SERVICE RETIREMENT ACT OF FEBRUARY 23, 1931, 46 STAT. 1211, PROVIDED AS FOLLOWS:

ANNUITIES SHALL BE PAID TO RETIRED FOREIGN SERVICE OFFICERS UNDER THE FOLLOWING CLASSIFICATIONS, BASED UPON LENGTH OF SERVICE AND AT THE FOLLOWING PERCENTAGES OF THE AVERAGE ANNUAL BASIC SALARY FOR THE TEN YEARS NEXT PRECEDING THE DATE OF RETIREMENT: CLASS A, THIRTY YEARS OR MORE, 60 PERCENTUM; CLASS B, FROM TWENTY-SEVEN TO THIRTY YEARS, 54 PERCENTUM; CLASS C, FROM TWENTY-FOUR TO TWENTY-SEVEN YEARS, 48 PERCENTUM; CLASS D, FROM TWENTY-ONE TO TWENTY-FOUR YEARS, 42 PERCENTUM; CLASS E, FROM EIGHTEEN TO TWENTY-ONE YEARS, 36 PERCENTUM; CLASS F, FROM FIFTEEN TO EIGHTEEN YEARS, 30 PERCENTUM; * * *.

THUS, IN COMPUTING THE ANNUITIES UNDER THAT STATUTE ON LENGTH OF SERVICE, A FRACTIONAL YEAR'S SERVICE WAS IN EFFECT DISREGARDED. NOTHING APPEARS OTHERWISE IN THE ORIGINAL ACT OR IN THE NEW FORMULA FOR COMPUTING ANNUITIES PRESCRIBED BY THE AMENDATORY ACT OF APRIL 24, 1939, WHICH AUTHORIZES THE ADDING OF A FRACTIONAL YEAR'S SERVICE TOWARD LONGEVITY. COMPARE THE PROVISION APPEARING IN SECTION 5 OF THE CIVIL RETIREMENT ACT OF MAY 29, 1930, 46 STAT. 472, AS FOLLOWS:

IN DETERMINING THE AGGREGATE PERIOD OF SERVICE UPON WHICH THE ANNUITY IS TO BE BASED, THE FRACTIONAL PART OF A MONTH, IF ANY, IN THE TOTAL SERVICE SHALL BE ELIMINATED.

IT IS UNDERSTOOD THAT THIS PROVISION HAS BEEN APPLIED BY THE UNITED STATES CIVIL SERVICE COMMISSION AS AUTHORIZING THE INCLUSION OF WHOLE MONTHS OF A FRACTIONAL YEAR'S SERVICE IN COMPUTING LONGEVITY, BUT NOT A FRACTIONAL MONTH'S SERVICE. HOWEVER, I FIND NO PROVISION IN THE FOREIGN SERVICE RETIREMENT ACT AS AMENDED, CORRESPONDING TO THE PROVISION QUOTED FROM THE CIVIL RETIREMENT ACT, OR ANY OTHER PROVISION JUSTIFYING ANY OTHER CONCLUSION THAN THAT A FRACTIONAL YEAR'S SERVICE MUST BE DISREGARDED IN COMPUTING LONGEVITY. ACCORDINGLY, IN THE TWO EXAMPLES STATED IN PARAGRAPH NO. 5 OF OFFICERS A AND B, THE FIRST FORMULA USED IN EACH CASE FOR COMPUTING THE RATE OF THE ANNUITIES, ELIMINATING THE FRACTIONAL YEAR'S SERVICE, IS CORRECT.

REFERRING TO THE QUESTION IN PARAGRAPH NO. 6, THE LIMITATION FIXED IN THE STATUTE OF "BY NOT MORE THAN EIGHT YEARS" CANNOT BE CONSTRUED TO MEAN "BY LESS THAN NINE YEARS.' THERE APPEARS NO REASONABLE BASIS FOR THE SUGGESTED IMPLICATION THAT "FRACTIONS OVER AND ABOVE A FLAT EIGHT YEARS ARE TO BE DISREGARDED UNTIL THE DIFFERENCE IS NINE YEARS OR MORE.' IF THE AGE OF THE OFFICER IS LESS THAN THE AGE OF THE WIFE OR EXCEEDS THE AGE OF THE WIFE BY EXACTLY 8 YEARS OR LESS, THE ANNUITY OF THE OFFICER IS REQUIRED TO BE REDUCED "BY AN AMOUNT EQUAL TO ONE-HALF THE ANNUITY WHICH HE ELECTS TO HAVE PAID TO HIS WIDOW.' IF, HOWEVER, THE AGE OF THE OFFICER EXCEEDS THAT OF HIS WIFE BY 8 YEARS AND 1 DAY OR MORE, THE ANNUITY OF THE OFFICER MUST BE REDUCED "BY AN AMOUNT EQUAL TO ONE-HALF THE ANNUITY WHICH HE ELECTS TO HAVE PAID TO HIS WIDOW PLUS AN ADDITIONAL REDUCTION EQUAL TO 2 PERCENTUM OF SUCH WIDOW'S ANNUITY FOR EACH YEAR, OR FRACTION THEREOF, THAT THE DIFFERENCE IN AGE EXCEEDS EIGHT.'

AS THE RESPECTIVE RIGHTS OF A FOREIGN SERVICE OFFICER WHO ELECTS TO RECEIVE A REDUCED JOINT AND SURVIVORSHIP ANNUITY AND OF HIS WIFE ARE FIXED AS OF THE DATE OF RETIREMENT OF THE OFFICER, ALL OF THE ASSUMPTIONS STATED IN PARAGRAPH NO. 7 ARE CORRECT. RELATIVE TO THE LAST ASSUMPTION STATED, THERE APPEARS NOTHING IN SECTION 26 (E) OF THE STATUTE REQUIRING A CONSTRUCTION THAT ANY PORTION OF THE EXCESS OF THE ACCUMULATED CONTRIBUTIONS OVER ANNUITY PAYMENTS ARE FORFEITED WHERE THE OFFICER HAD ELECTED TO RECEIVE A JOINT AND SURVIVORSHIP ANNUITY WITH HIS WIFE AND THE WIFE DIES AFTER RETIREMENT OF THE OFFICER BUT BEFORE THE DEATH OF THE OFFICER.

THE PROVISION IN SECTION 26 (E) OF THE ACT, AS AMENDED, MATERIAL TO AN ANSWER TO THE QUESTION IN PARAGRAPH NO. 8, IS AS FOLLOWS:

* * * THAT A RETIRED OFFICER WHO IS RECEIVING AN ANNUITY ON THE EFFECTIVE DATE OF THIS ACT, IF THE HUSBAND OF A WIFE TO WHOM HE WAS MARRIED AT THE TIME OF HIS RETIREMENT AND FOR A TOTAL PERIOD OF AT LEAST FIVE YEARS, SHALL BE ENTITLED UNDER THE SAME TERMS AND CONDITIONS SET FORTH ABOVE, TO ELECT TO RECEIVE A REDUCED ANNUITY, A PORTION OF WHICH WILL BE CONTINUED ON HIS DEATH THROUGHOUT THE LIFE OF HIS SURVIVING WIDOW, BUT ALL SUCH ELECTIONS BY RETIRED OFFICERS SHALL BE MADE WITHIN SIX MONTHS FOLLOWING THE EFFECTIVE DATE OF THIS ACT, AND THEY SHALL ALL BE EFFECTIVE ON THE SAME DATE, TO BE PRESCRIBED BY THE PRESIDENT: AND PROVIDED FURTHER, THAT NO INCREASE IN ANNUITIES UNDER THIS ACT SHALL OPERATE RETROACTIVELY AND NOTHING IN THIS ACT SHALL BE INTERPRETED AS REDUCING THE RATE OF THE ANNUITY RECEIVED BY ANY RETIRED OFFICER ON THE EFFECTIVE DATE OF THIS ACT, UNLESS THE OFFICER VOLUNTARILY ELECTS TO RECEIVE A REDUCED ANNUITY AS PROVIDED HEREIN.

WHILE THE STATUTE DOES NOT IN DEFINITE TERMS AUTHORIZE RECALCULATION OF EXISTING ANNUITIES OF FOREIGN SERVICE OFFICERS, EXCEPT WHERE AN OFFICER ELECTS TO RECEIVE A JOINT AND SURVIVORSHIP ANNUITY WITH HIS WIFE -- COMPARE SECTION 8 OF THE CIVIL SERVICE RETIREMENT ACT OF MAY 29, 1930, 46 STAT. 475--- IT REASONABLY MAY BE CONCLUDED FROM THE WORDING OF THE LAST PROVISO OF SECTION 26 (E) OF THE STATUTE AS AMENDED, SUPRA, THAT SUCH WAS THE INTENT, AND IT IS SO HELD. ALL SUCH RECALCULATED ANNUITIES WILL BECOME EFFECTIVE JULY 1, 1939. AN OFFICER MAY BE PAID THE RECOMPUTED ANNUITY FROM JULY 1, 1939, UNTIL THE EFFECTIVE DATE, TO BE FIXED BY THE PRESIDENT, OF A JOINT AND SURVIVORSHIP ANNUITY WITH HIS WIFE, AND THERE IS NO REQUIREMENT THAT THE FULL ANNUITY TO WHICH THE OFFICER IS ENTITLED EFFECTIVE JULY 1, 1939, SHOULD BE REDUCED RETROACTIVELY TO JULY 1, 1939, FROM THE EFFECTIVE DATE OF THE JOINT AND SURVIVORSHIP ANNUITY. THE QUESTION IN PARAGRAPH NO. 8 IS ANSWERED ACCORDINGLY.

THIS OFFICE IS IN AGREEMENT WITH THE VIEWS EXPRESSED IN PARAGRAPH NO. 9 OF YOUR LETTER FIRST ABOVE QUOTED UNDER THE HEADING "SECTION 4, AMENDING SECTION 33 OF THE ACT OF FEBRUARY 23, 1931.'

REFERRING TO THE SECOND LETTER QUOTED ABOVE, THIS OFFICE IS IN AGREEMENT WITH YOUR CONCLUSION THAT EXISTING REGULATIONS PROMULGATED BY THE PRESIDENT UNDER THE PROVISIONS OF THE ACT OF FEBRUARY 23, 1931, WHICH HAVE BEEN REENACTED WITHOUT CHANGE AND NOT IN CONFLICT WITH THE PROVISIONS OF THE ACT OF APRIL 24, 1939, WILL REMAIN IN FULL FORCE AND EFFECT UNTIL SUPERSEDED OR REVOKED.