B-121690, JUNE 29, 1955, 34 COMP. GEN. 715

B-121690, JUNE 29, 1955, 34 COMP. GEN. 715

GRATUITIES - REENLISTMENT BONUS - COMPUTATION REENLISTMENTS IN THE UNIFORMED SERVICES ON OR AFTER OCTOBER 1, 1949, FOR WHICH MEMBERS RECEIVED ENLISTMENT ALLOWANCES IN LIEU OF REENLISTMENT BONUSES MUST BE INCLUDED IN DETERMINING THE NUMBER OF ENLISTMENTS FOR BONUS COMPUTATION PURPOSES UNDER SECTION 208 OF THE CAREER COMPENSATION ACT OF 1949. REENLISTMENTS IN THE UNIFORMED SERVICES ENTERED INTO ON OR AFTER OCTOBER 1, 1949, FOR WHICH THE MEMBER DID NOT RECEIVE EITHER A REENLISTMENT BONUS OR AN ENLISTMENT ALLOWANCE BECAUSE HE WAS OUT OF THE SERVICE FOR MORE THAN THREE MONTHS MAY BE EXCLUDED IN DETERMINING THE NUMBER OF ENLISTMENTS FOR BONUS COMPUTATION PURPOSES UNDER SECTION 208 OF THE CAREER COMPENSATION ACT OF 1949. A MEMBER OF THE UNIFORMED SERVICES WHO REENLISTS IMMEDIATELY AFTER OFFICER SERVICE WHICH FOLLOWED EARLIER ENLISTED SERVICE MAY BE CONSIDERED FOR BONUS COMPUTATION PURPOSES UNDER SECTION 208 (D) OF THE CAREER COMPENSATION ACT OF 1949 AS HAVING "RECEIVED A BONUS" FOR HIS EARLIER REENLISTMENT IF SUCH REENLISTMENT WAS ENTERED INTO AFTER OCTOBER 1, 1949, AND WAS REWARDED BY AN ENLISTMENT ALLOWANCE.

ASSISTANT COMPTROLLER GENERAL WEITZEL TO THE SECRETARY OF DEFENSE, JUNE 29, 1955:

REFERENCE IS MADE TO LETTER OF MAY 17, 1955, FROM THE ASSISTANT SECRETARY OF DEFENSE ( COMPTROLLER), REQUESTING RECONSIDERATION OF OUR DECISION OF MARCH 30, 1955, B-121690, 34 COMP. GEN. 483, CONCERNING THE METHOD OF COMPUTING THE AMOUNT OF REENLISTMENT BONUS TO WHICH CERTAIN MEMBERS OF THE UNIFORMED SERVICES ARE ENTITLED UNDER THE PROVISIONS OF SECTION 208 OF THE CAREER COMPENSATION ACT OF 1949, AS ADDED BY SECTION 2 OF THE ACT OF JULY 16, 1954, 68 STAT. 488.

SECTION 208 CONTAINS A TABLE AUTHORIZING A RELATIVELY LARGE REENLISTMENT BONUS FOR A MEMBER'S FIRST REENLISTMENT WITH A SHARPLY DECREASING SCALE OF PAYMENTS FOR SUBSEQUENT REENLISTMENTS. FOOTNOTE NO. 1 TO THE TABLE PROVIDES THAT IN DETERMINING THE NUMBER OF A REENLISTMENT "ANY REENLISTMENT WHEN A BONUS WAS NOT AUTHORIZED IS NOT COUNTED. WE HELD THAT THE ONLY REENLISTMENTS EXCLUDED BY THE FOOTNOTE ARE THOSE ENTERED INTO PRIOR TO OCTOBER 1, 1949, WHEN THERE WAS NO STATUTORY PROVISION FOR PAYMENT OF ANY "REENLISTMENT BONUS," AS SUCH, IN ANY CASE, THE PAYMENTS PREVIOUSLY AUTHORIZED TO STIMULATE REENLISTMENTS BEING TERMED "ENLISTMENT ALLOWANCES.'

UPON FURTHER CONSIDERATION, WE HAVE CONCLUDED THAT OUR STATEMENT THAT "THE ONLY REENLISTMENTS EXCLUDED BY THE FOOTNOTE ARE THOSE ENTERED INTO PRIOR TO OCTOBER 1, 1949," MAY HAVE BEEN TOO BROAD. WE ADHERE, HOWEVER, TO OUR PROPOSITION OF COUNTING, AS A REENLISTMENT FOR THE PURPOSES OF THE TABLE IN SECTION 208, ANY REENLISTMENT ENTERED INTO AFTER OCTOBER 1, 1949, WHICH WAS REWARDED BY AN "ENLISTMENT ALLOWANCE" IN LIEU OF A "REENLISTMENT BONUS.' SINCE IT IS APPARENT THAT A MEMBER WHO RECEIVED AN ENLISTMENT ALLOWANCE FOR A REENLISTMENT AFTER OCTOBER 1, 1949, IN EFFECT RECEIVED THE BONUS PLUS SOMETHING ELSE, THAT IS, THE AMOUNT BY WHICH THE ALLOWANCE EXCEEDED THE AMOUNT WHICH WOULD HAVE BEEN PAYABLE AS BONUS EXCEPT FOR A SAVING PROVISION, IT WOULD BE HIGHLY ILLOGICAL TO EXCLUDE SUCH A REENLISTMENT IN THE COMPUTATION OF A REENLISTMENT BONUS CURRENTLY PAYABLE UNDER SECTION 208. IF CONGRESS HAD INTENDED THAT SUCH A REENLISTMENT SHOULD NOT BE COUNTED AS A REENLISTMENT IN COMPUTING A PAYMENT UNDER SECTION 208, IT SEEMS MOST PROBABLE THAT SUCH INTENT WOULD HAVE BEEN REFLECTED IN THE LEGISLATIVE HISTORY OF THE ACT OF JULY 16, 1954. CAREFUL EXAMINATION OF THAT HISTORY, HOWEVER, DISCLOSES NOTHING TO INDICATE SUCH AN INTENT AND DISCLOSES NUMEROUS STATEMENTS INDICATING THAT THE PRIMARY PURPOSE OF THE LEGISLATION WAS TO GIVE THE LARGEST REENLISTMENT BONUS PAYMENTS TO MEMBERS WHO HAVE COMPLETED RELATIVELY SHORT PERIODS OF SERVICE AND WHO, THEREFORE, WOULD NOT HAVE OTHER STRONG MATERIAL INCENTIVES TO REENLIST, SUCH AS THE PROSPECT OF EARLY RETIREMENT WITH PAY.

IN HIS LETTER OF MAY 17, 1955, THE ASSISTANT SECRETARY OF DEFENSE STATES THAT THE INDIVIDUALS WHO REENLISTED AFTER THE ENACTMENT OF THE ACT OF JULY 16, 1954, AND PRIOR TO OUR DECISION, DID SO IN GOOD FAITH AND RECEIVED A REENLISTMENT BONUS BASED ON UNIFORM REGULATIONS OF THE DEPARTMENT OF DEFENSE AND THAT IT WOULD BE A SERIOUS MORALE FACTOR TO THESE INDIVIDUALS AND THEIR FAMILIES TO REQUIRE THEM NOW TO REPAY PART OF THE BONUS PAID THEM AT THE TIME OF THEIR REENLISTMENT. HE REQUESTS THAT, IN THE EVENT THE DECISION IS ADHERED TO, NO COLLECTION ACTION BE TAKEN AGAINST THE MEMBERS INVOLVED UNTIL SUCH TIME AS THE MATTER MAY BE PRESENTED TO THE CONGRESS FOR POSSIBLE ENACTMENT OF VALIDATING LEGISLATION.

THE ASSISTANT SECRETARY'S LETTER WAS ACCOMPANIED BY A COPY OF COMMITTEE ACTION NO. 116 OF THE MILITARY PAY AND ALLOWANCE COMMITTEE, DEPARTMENT OF DEFENSE, SETTING FORTH A DISCUSSION OF THE MATTER. IN THE DISCUSSION IT IS STATED THAT A LITERAL READING OF OUR DECISION WOULD SEEM TO REQUIRE THAT REENLISTMENTS ENTERED INTO ON AND AFTER OCTOBER 1, 1949, BE INCLUDED IN DETERMINING THE NUMBER OF A REENLISTMENT EVEN THOUGH THE MEMBER MAY HAVE RECEIVED NEITHER A BONUS NOR AN ALLOWANCE BECAUSE HIS PREVIOUS ENLISTMENT OCCURRED MORE THAN THREE MONTHS OR 90 DAYS AFTER DISCHARGE OR SEPARATION. IT IS ARGUED THAT SUCH A RESULT WAS NOT INTENDED BY THE CONGRESS AND IS NOT REQUIRED BY THE LANGUAGE OF THE ACT, PARTICULARLY SINCE PAYMENTS TO MEMBERS WHO REENLIST UNDER SUCH CONDITIONS ARE ALREADY RESTRICTED BY THOSE PROVISIONS OF SECTION 208 (B) WHICH REQUIRE THAT ANY SERVICE IN EXCESS OF 20 YEARS BE EXCLUDED IN THE COMPUTATION OF A REENLISTMENT BONUS.

IN THE LIGHT OF THE VIEWS STATED ABOVE, WE WILL NOT OBJECT IN THE COMPUTATION OF A REENLISTMENT BONUS UNDER SECTION 208 TO THE EXCLUSION OF A REENLISTMENT ENTERED INTO ON OR AFTER OCTOBER 1, 1949, FOR WHICH THE MEMBER RECEIVED NEITHER A REENLISTMENT BONUS NOR AN ENLISTMENT ALLOWANCE BECAUSE HE WAS OUT OF THE SERVICE FOR MORE THAN THREE MONTHS.

IT IS FURTHER ARGUED THAT THE LANGUAGE OF SECTION 208 (C) REQUIRES THAT "ENLISTMENT ALLOWANCES" BE EXCLUDED IN COMPUTING THE CUMULATIVE AMOUNT OF REENLISTMENT BONUSES PAYABLE AND, THEREFORE, OUR DECISION HAS THE EFFECT OF REQUIRING THE USE OF ONE RULE FOR DETERMINING THE AMOUNTS OF INDIVIDUAL PAYMENTS AND ANOTHER FOR DETERMINING THE TOTAL OF ALL PAYMENTS.

THE INTENT OF THE LANGUAGE OF SECTION 208 (C) OF THE ACT OF JULY 16, 1954, 68 STAT. 489, IS NOT ENTIRELY CLEAR INSOFAR AS SUCH SECTION IS TO BE APPLIED IN A CASE INVOLVING PAYMENT OF AN ENLISTMENT ALLOWANCE UNDER THE SAVING PROVISION IN SECTION 207 (D) OF THE CAREER COMPENSATION ACT, 63 STAT. 812. ACCORDINGLY, WE WILL NOT REQUIRE THAT AN ENLISTMENT ALLOWANCE PAID AFTER OCTOBER 1, 1949, UNDER SUCH SAVING PROVISION, BE INCLUDED IN COMPUTING THE CUMULATIVE AMOUNT REFERRED TO IN SECTION 208 (C) EVEN THOUGH IT WOULD NOT BE UNREASONABLE TO HOLD THAT AN "ENLISTMENT ALLOWANCE" PAID UNDER A SAVING CLAUSE IN A LAW AUTHORIZING REENLISTMENT BONUSES IS PAID UNDER A PROVISION OF LAW AUTHORIZING REENLISTMENT BONUSES.

ANOTHER POINT WHICH HAS BEEN PRESENTED IS THAT CERTAIN LANGUAGE IN SECTION 208 (D), 68 STAT. 489, RESPECTING THE COMPUTATION OF THE REENLISTMENT BONUS IN THE CASE OF A MEMBER WHO PREVIOUSLY HAD BEEN ENLISTED AND WHO SERVED AS AN OFFICER IMMEDIATELY BEFORE THE CURRENT REENLISTMENT, IS A CLEAR EXPRESSION OF THE INTENT OF THE CONGRESS THAT THE AMOUNT OF BONUS PAYABLE TO AN OFFICER WHO REENLISTS IS GOVERNED BY THE NUMBER OF BONUSES PREVIOUSLY PAID TO HIM AS AN INDIVIDUAL RATHER THAN BY THE DATE ON WHICH HE PREVIOUSLY REENLISTED. IT IS ARGUED THAT INASMUCH AS SUCH LANGUAGE MUST BE READ TOGETHER WITH THE LANGUAGE OF FOOTNOTE NO. 1 IN SUBSECTION (A), IT IS BELIEVED THAT THE SAME RESULT WAS INTENDED FOR BOTH OFFICERS AND ENLISTED MEN, AND THAT TO HOLD OTHERWISE WOULD RESULT IN LARGER PAYMENTS TO OFFICERS WHO NOW REENLIST THAN TO ENLISTED MEN IN THE SAME CIRCUMSTANCES.

THE MEMBER WHO REENLISTS IMMEDIATELY AFTER OFFICER SERVICE WHICH FOLLOWED EARLIER ENLISTED SERVICE SHOULD BE CONSIDERED AS HAVING "RECEIVED A BONUS" FOR HIS EARLIER REENLISTMENT IF SUCH REENLISTMENT WAS ENTERED INTO AFTER OCTOBER 1, 1949, AND WAS REWARDED BY AN ENLISTMENT ALLOWANCE, THAT IS, BY A BONUS PLAN AN ADDITIONAL AMOUNT. THIS IS A REASONABLE VIEW OF THE LANGUAGE AND INTENT OF THE LAW AND WILL AVOID THE DISCRIMINATION SUGGESTED BY THE PAY COMMITTEE.

IT IS FURTHER STATED THAT THE EFFECT OF OUR DECISION OF MARCH 30, 1955, WILL BE PARTICULARLY SEVERE IN THOSE CASES INVOLVING SERVICEMEN WITH SUBSTANTIAL PRIOR SERVICE WHO ELECTED IN GOOD FAITH TO RECEIVE A BONUS UNDER SECTION 208, RATHER THAN UNDER SECTION 207 OF THE ACT, PRIOR TO THE DATE OF THE DECISION. AN EXAMPLE IS GIVEN OF AN ENLISTED MAN WHO REENLISTED IN OCTOBER 1949 FOR THREE YEARS AND RECEIVED AN ALLOWANCE OF $150. HE SUBSEQUENTLY REENLISTED IN OCTOBER 1952 FOR ANOTHER THREE YEARS AND WAS PAID A BONUS OF $90. IN MARCH 1955 HE WAS DISCHARGED FOR THE PURPOSE OF REENLISTING FOR A PERIOD OF SIX YEARS, REFUNDED $17.50 OF HIS PREVIOUS BONUS, AND, AS HE WAS IN PAY GRADE E-7 WITH NEARLY 14 YEARS' SERVICE, RECEIVED A BONUS UNDER SECTION 208 OF $978.44. AS A RESULT OF THE DECISION, HE WILL NOW BE CALLED ON TO REFUND $489.22 OF THE AMOUNT PAID, AND BECAUSE HE ELECTED TO BE PAID UNDER SECTION 208 HE WILL RECEIVE LITTLE OR NOTHING WHEN HE AGAIN REENLISTS, SINCE HE WILL THEN HAVE NEARLY 20 YEARS' SERVICE. IF HE HAD BEEN PAID UNDER SECTION 207, HE WOULD HAVE RECEIVED $360 IN MARCH (AS OPPOSED TO $489.22 UNDER SECTION 208) AND COULD HAVE CONTINUED TO RECEIVE BONUSES UNTIL HE HAD 30 YEARS' SERVICE OR RECEIVED A TOTAL OF $1,440, WHICH WOULD HAVE BEEN GREATLY TO HIS ADVANTAGE DURING THE NEXT 10 YEARS.

WE WILL NOT INSIST ON HOLDING MEMBERS TO ELECTIONS SO MADE PRIOR TO THE DATE OF OUR DECISION OF MARCH 30, 1955, AND WILL GIVE THEM A REASONABLE TIME AFTER THE PRESENT DATE TO MAKE NEW ELECTIONS IN ORDER THAT APPROPRIATE ADJUSTMENTS MAY BE MADE.

RESPECTING THE ASSISTANT SECRETARY'S STATEMENT THAT IT WOULD BE "A SERIOUS MORALE FACTOR TO THESE INDIVIDUALS AND THEIR FAMILIES TO REQUIRE THEM NOW TO REPAY PART OF THE BONUS PAID THEM AT THE TIME OF THEIR REENLISTMENT," YOU PROBABLY ARE AWARE THAT BY LETTER OF MAY 27, 1955, WE ADVISED THE DIRECTOR, BUREAU OF THE BUDGET, THAT WE WOULD NOT OBJECT TO ENACTMENT OF A PROPOSED BILL SUBMITTED BY THE DEFENSE DEPARTMENT AS A 1955 LEGISLATIVE PROGRAM ITEM. THE PROPOSED BILL WOULD VALIDATE ALL PAYMENTS OF REENLISTMENT BONUSES WHICH HAVE BEEN MADE UNDER THE PROVISIONS OF SECTION 208 OF THE CAREER COMPENSATION ACT OF 1949, AS ADDED BY SECTION 2 OF THE ACT OF JULY 16, 1954, 68 STAT. 488, TO THE EXTENT THAT SUCH BONUSES WERE COMPUTED ON THE BASIS THAT REENLISTMENTS ENTERED INTO BY THE MEMBER CONCERNED SUBSEQUENT TO SEPTEMBER 30, 1949, FOR WHICH HE DID NOT RECEIVE A REENLISTMENT BONUS, AS SUCH, UNDER SECTION 207 OF THE CAREER COMPENSATION ACT OF 1949, WERE NOT COUNTED IN DETERMINING THE REENLISTMENT INVOLVED.

WE WILL NOT PRESS COLLECTION ACTION IN SUCH CASES AGAINST THE DISBURSING OFFICERS INVOLVED, PRIOR TO THE END OF THE PRESENT SESSION OF CONGRESS, EXCEPT TO THE EXTENT NECESSARY TO AVOID SUBSTANTIAL PREJUDICE TO THE RIGHTS AND INTERESTS OF THE GOVERNMENT UNDER THE LAW. SEE THE ACT OF MAY 19, 1947, 61 STAT. 101, 31 U.S.C. 82I, WHICH PROVIDES THAT THE ACCOUNTS OF DISBURSING OFFICERS SHALL BE SETTLED WITHIN THREE YEARS AFTER THE DATE OF THEIR RECEIPT BY THE GENERAL ACCOUNTING OFFICE. AS YOU KNOW, THE MATTER OF RECOVERING AMOUNTS OF OVERPAYMENTS BY COLLECTING FROM THE PAYEES IS LARGELY A MATTER FOR THE DISBURSING OFFICERS TO DECIDE, SINCE THEY ARE THE ONES PRIMARILY LIABLE FOR THE OVERPAYMENTS. SEE 19 COMP. GEN. 306 AND 28 COMP. GEN. 17.