B-5731, OCTOBER 2, 1939, 19 COMP. GEN. 411

B-5731, OCTOBER 2, 1939, 19 COMP. GEN. 411

RETIREMENT - FOREIGN SERVICE - SERVICE CREDITS - VOLUNTARY PURCHASES OF CREDIT FOR PRIOR SERVICE IN OTHER THAN FOREIGN SERVICE, ETC. THE ACT OF AUGUST 5, 1939, 53 STAT. 1208, PROVIDES THAT AN ELIGIBLE FOREIGN SERVICE OFFICER MAY PURCHASE SERVICE CREDIT FOR RETIREMENT PURPOSES FOR OTHER GOVERNMENT SERVICE, IF SUCH SERVICE IS SUBSEQUENT TO JULY 1, 1924, AND PRIOR TO APPOINTMENT AS A FOREIGN SERVICE OFFICER BUT (1) THE AVAILABLE PRIOR SERVICE CREDIT CANNOT BE SPLIT, THAT IS, A PART ONLY OF THE SERVICE CANNOT BE PURCHASED; (2) NO PRIOR SERVICE CREDIT PURCHASED CAN BE CREDITED FOR RETIREMENT PURPOSES UNTIL THE FULL SUM REQUIRED FOR THE PURCHASE HAS BEEN PAID; (3) NO CREDIT CAN BE GIVEN FOR RETIREMENT PURPOSES FOR GOVERNMENT SERVICE PRIOR TO JULY 1, 1924, UNTIL CONTRIBUTIONS AND ACCUMULATED INTEREST HAVE BEEN FULLY PAID FOR ALL SUCH SERVICE SUBSEQUENT TO JULY 1, 1924. RETIRED FOREIGN SERVICE OFFICERS OR ANNUITANTS ARE NOT ENTITLED TO INCREASE THEIR ANNUITY BY PURCHASING ADDITIONAL LONGEVITY CREDITS UNDER THE TERMS OF THE ACT OF AUGUST 5, 1939, 53 STAT. 1208.

COMPTROLLER GENERAL BROWN TO THE SECRETARY OF STATE, OCTOBER 2, 1939:

I HAVE YOUR LETTER OF AUGUST 23, 1939, AS FOLLOWS:

THERE ARE ENCLOSED TWO COPIES OF THE ACT APPROVED AUGUST 5, 1939, PUBLIC, NO. 277, 76TH CONGRESS, AMENDING 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, AS AMENDED BY THE ACT OF APRIL 24, 1939, PUBLIC, NO. 40, 76TH CONGRESS. THE ACT OF AUGUST 5, 1939, AMENDS SECTION 26 (O) OF THE ACT OF FEBRUARY 23, 1931, AS AMENDED, IN ORDER TO ACCORD TO ELIGIBLE AMERICAN FOREIGN SERVICE OFFICERS SERVICE CREDIT TOWARD RETIREMENT FOR GOVERNMENT SERVICE OTHER THAN FOREIGN SERVICE AND SERVICE IN THE DEPARTMENT OF STATE. THE LANGUAGE OF THE PROVISO OF SECTION 26 (O) AS EMBODIED IN THE ACT OF AUGUST 5, 1939, IS ALL NEW LANGUAGE AND IS PRACTICALLY IDENTICAL WITH SIMILAR PROVISIONS IN THE UNITED STATES CIVIL SERVICE RETIREMENT LAW.

THE ACT OF AUGUST 5, 1939, PROVIDES THAT AN ELIGIBLE FOREIGN SERVICE OFFICER MAY PURCHASE SERVICE CREDIT FOR OTHER GOVERNMENT SERVICE, IF SUCH SERVICE IS SUBSEQUENT TO JULY 1, 1924, AND PRIOR TO APPOINTMENT AS A FOREIGN SERVICE OFFICER, BY PAYING INTO THE FOREIGN SERVICE RETIREMENT AND DISABILITY FUND A SPECIAL CONTRIBUTION EQUAL TO 5 PERCENTUM OF HIS ANNUAL SALARY FOR EACH YEAR OF SUCH EMPLOYMENT, WITH INTEREST THEREON TO DATE OF PAYMENT COMPOUNDED ANNUALLY AT 4 PERCENTUM. I SHOULD LIKE TO HAVE YOU INFORM ME WHETHER I AM CORRECT IN MY UNDERSTANDING THAT ALTHOUGH THE PURCHASE OF PRIOR SERVICE CREDIT UNDER THE PROVISIONS OF THE ACT IS OPTIONAL WITH EACH OFFICER WHO IS ELIGIBLE TO THIS PRIVILEGE, (1) THE AVAILABLE PRIOR SERVICE CREDIT CANNOT BE SPLIT, THAT IS, A PART ONLY OF THIS SERVICE CANNOT BE PURCHASED; (2) NO PRIOR SERVICE CREDIT PURCHASED CAN BE CREDITED FOR RETIREMENT PURPOSES UNTIL THE FULL SUM REQUIRED FOR THE PURCHASE HAS BEEN PAID, UNLESS IN A PARTICULAR CASE ALL SUCH SERVICE IS PRIOR TO JULY 1, 1924, FOR WHICH CREDIT NO PAYMENTS ARE REQUIRED UNDER THE ACT; AND (3) NO CREDIT CAN BE GIVEN FOR RETIREMENT PURPOSES FOR GOVERNMENT SERVICE PRIOR TO JULY 1, 1924, UNTIL CONTRIBUTIONS AND ACCUMULATED INTEREST, IF ANY, HAVE BEEN FULLY PAID FOR ALL SUCH SERVICE SUBSEQUENT TO JULY 1, 1924.

I SHOULD LIKE TO HAVE YOU INFORM ME ALSO WHETHER THE NEW CATEGORIES OF SERVICE CREDIT AUTHORIZED BY THE ACT OF AUGUST 5, 1939, ARE TO BE CONSIDERED AVAILABLE TO OFFICERS NOW RETIRED FOR THE PURPOSE OF INCREASING THE ANNUITIES WHICH THEY ARE NOW RECEIVING IN CASE SUCH ANNUITIES ARE LESS THAN THE MAXIMUM TO WHICH THE OFFICERS WOULD BE ENTITLED UNDER THE LAW. FOR EXAMPLE, AN OFFICER WHO RETIRED AFTER 27 YEARS IN THE FOREIGN SERVICE IS ABLE TO ESTABLISH SERVICE CREDIT FOR 3 YEARS OF PRIOR GOVERNMENT SERVICE MAKING HIS TOTAL SERVICE AMOUNT TO 30 YEARS AND ENTITLING HIM TO THE MAXIMUM ANNUITY UNDER SECTION 26 (E) OF THE ACT OF FEBRUARY 23, 1931, AS AMENDED APRIL 24, 1939. IF RETIRED OFFICERS ARE ALLOWED ADDITIONAL SERVICE CREDIT UNDER THE ACT OF AUGUST 5, 1939, AND THEIR ANNUITIES ARE REVISED, WILL THIS REVISION OF THEIR ANNUITIES BE EFFECTIVE FROM AUGUST 5, 1939, THE EFFECTIVE DATE OF THE ACT, OR ONLY FROM THE DATE ON WHICH PROOF IS SUBMITTED OF SUCH PRIOR SERVICE?

I SHALL APPRECIATE YOUR PROMPT ATTENTION TO THE POINTS RAISED IN THIS LETTER.

SECTION 26 (O) OF THE FOREIGN SERVICE RETIREMENT ACT, AS AMENDED BY THE ACT OF AUGUST 5, 1939, PUBLIC, NO. 277, 53 STAT. 1208, PROVIDES:

FOR THE PURPOSES OF THIS ACT THE PERIOD OF SERVICE SHALL BE COMPUTED FROM THE DATE OF ORIGINAL OATH OF OFFICE AS DIPLOMATIC SECRETARY, CONSUL GENERAL, CONSUL, VICE CONSUL, DEPUTY CONSUL, CONSULAR ASSISTANT, CONSULAR AGENT, COMMERCIAL AGENT, INTERPRETER, OR STUDENT INTERPRETER, AND SHALL INCLUDE PERIODS OF SERVICE AT DIFFERENT TIMES AS EITHER A DIPLOMATIC OR CONSULAR OFFICER, OR WHILE ON ASSIGNMENT TO THE DEPARTMENT OF STATE, OR ON SPECIAL DUTY OR SERVICE IN ANOTHER DEPARTMENT OR ESTABLISHMENT OF THE GOVERNMENT, BUT ALL PERIODS OF SEPARATION FROM THE SERVICE AND SO MUCH OF ANY PERIOD OF LEAVE OF ABSENCE WITHOUT PAY AS MAY EXCEED SIX MONTHS SHALL BE EXCLUDED: PROVIDED, THAT SERVICE PRIOR TO APPOINTMENT AS A FOREIGN SERVICE OFFICER AS A CLASSIFIED OR AN UNCLASSIFIED EMPLOYEE IN THE CIVIL SERVICE OF THE UNITED STATES, OR IN THE SERVICE OF THE DISTRICT OF COLUMBIA, INCLUDING PERIODS OF SERVICE AT DIFFERENT TIMES AND IN ONE OR MORE DEPARTMENTS, BRANCHES, OR INDEPENDENT OFFICES, OR THE LEGISLATIVE BRANCH OF THE GOVERNMENT, AND ALSO PERIODS OF SERVICE PERFORMED OVERSEAS UNDER AUTHORITY OF THE UNITED STATES, AND PERIODS OF HONORABLE SERVICE IN THE ARMY, NAVY, MARINE CORPS, OR COAST GUARD OF THE UNITED STATES MAY BE INCLUDED IN THE PERIOD OF SERVICE, IN WHICH CASE THE OFFICER SHALL PAY INTO THE FOREIGN SERVICE RETIREMENT AND DISABILITY FUND A SPECIAL CONTRIBUTION EQUAL TO 5 PERCENTUM OF HIS ANNUAL SALARY FOR EACH YEAR OF SUCH EMPLOYMENT SUBSEQUENT TO JULY 1, 1924, WITH INTEREST THEREON TO DATE OF PAYMENT COMPOUNDED ANNUALLY AT 4 PERCENTUM AND ALL SUCH OFFICERS WITHIN THE PURVIEW OF THIS PROVISION MAY ELECT TO MAKE SUCH DEPOSITS IN INSTALLMENTS DURING THE CONTINUANCE OF THEIR SERVICE IN SUCH AMOUNTS AND UNDER SUCH CONDITIONS AS MAY BE DETERMINED IN EACH INSTANCE BY THE SECRETARY OF STATE; BUT IN THE CASE OF A FOREIGN SERVICE OFFICER WHO IS ELIGIBLE FOR AND ELECTS TO RECEIVE A PENSION UNDER ANY LAW, OR RETIRED PAY ON ACCOUNT OF MILITARY OR NAVAL SERVICE, OR COMPENSATION UNDER THE WAR RISK INSURANCE ACT, THE PERIOD OF HIS MILITARY OR NAVAL SERVICE UPON WHICH SUCH PENSION, RETIRED PAY, OR COMPENSATION IS BASED SHALL NOT BE INCLUDED, BUT NOTHING IN THIS ACT SHALL BE SO CONSTRUED AS TO AFFECT IN ANY MANNER HIS RIGHT TO A PENSION, OR TO RETIRED PAY, OR TO COMPENSATION UNDER THE WAR RISK INSURANCE ACT IN ADDITION TO THE ANNUITY HEREIN PROVIDED.

SECTION 18 (C) OF THE ORIGINAL FOREIGN SERVICE RETIREMENT ACT APPROVED MAY 24, 1924, 43 STAT. 144, REQUIRED RETIREMENT DEDUCTIONS FROM AND AFTER JULY 1, 1924, THE EFFECTIVE DATE OF THE ACT. ANY SERVICE OF A CHARACTER COMING WITHIN THE PURVIEW OF THAT ACT RENDERED PRIOR TO JULY 1, 1924, WAS AUTHORIZED TO BE CREDITED AS ANNUITABLE SERVICE WITHOUT REQUIREMENT OF DEDUCTIONS OR DEPOSITS COVERING SUCH SERVICE. THE AMENDATORY ACT OF AUGUST 5, 1939, SUPRA, MAKES NO CHANGE IN THAT RESPECT BUT ENLARGES THE FIELD OF SERVICE WHICH MAY BE CREDITED FOR ANNUITABLE PURPOSES BY PROVIDING FOR THE INCLUSION OF SERVICE OTHER THAN FOREIGN SERVICE AND SERVICE IN THE DEPARTMENT OF STATE, AND BY PROVIDING, ALSO, FOR THE PURCHASE OF CREDIT THEREFOR IF SUCH SERVICE IS SUBSEQUENT TO JULY 1, 1924, AND PRIOR TO APPOINTMENT AS A FOREIGN SERVICE OFFICER,"IN WHICH CASE," HOWEVER, THE STATUTE PROVIDES THAT "THE OFFICER SHALL PAY" INTO THE DESIGNATED FUND "A SPECIAL CONTRIBUTION EQUAL TO 5 PERCENTUM OF HIS ANNUAL SALARY FOR EACH YEAR OF SUCH EMPLOYMENT SUBSEQUENT TO JULY 1, 1924," WITH INTEREST, ETC. WHILE, IN THE EVENT OF PURCHASE OF SUCH SERVICE CREDIT, THE STATUTE PERMITS THE INVOLVED EMPLOYEES TO ELECT TO MAKE SUCH DEPOSITS IN INSTALLMENTS DURING THE CONTINUANCE OF THEIR SERVICE IN SUCH AMOUNTS AND UNDER SUCH CONDITIONS AS MAY BE DETERMINED IN EACH INSTANCE BY THE SECRETARY OF STATE, I FIND NO PROVISION THEREIN WHICH AUTHORIZES THE SPLITTING UP OF SUCH AVAILABLE PRIOR SERVICE CREDIT, OR WHICH WOULD WARRANT THE INFERENCE THAT SUCH MAY BE DONE--- THE PROVISIONS OF THE STATUTE HERE BEING UNLIKE THOSE OF THE CIVIL RETIREMENT ACT WHEREUNDER THERE MAY BE A SPLITTING UP OF ANNUITABLE SERVICE PURCHASED UNDER SOMEWHAT SIMILAR SITUATIONS. SEE DECISION B-5238, DATED AUGUST 22, 1939, 19 COMP. GEN. 246, TO THE PRESIDENT, UNITED STATES CIVIL SERVICE COMMISSION, COPY OF WHICH DECISION IS ENCLOSED FOR YOUR INFORMATION.

SO FAR AS THE REGULAR FOREIGN SERVICE OFFICERS ARE CONCERNED ANY SERVICE RENDERED PRIOR TO JULY 1, 1924, CONSTITUTES WHAT MAY BE CALLED "FREE SERVICE," I.E., A PERIOD OF SERVICE FOR WHICH NO DEDUCTIONS WERE REQUIRED TO BE MADE FROM THEIR COMPENSATION. THUS, IT WOULD NOT APPEAR EQUITABLE TO ALLOW THE INVOLVED EMPLOYEES TO ELECT TO COUNT PERIODS OF SERVICE PRIOR TO JULY 1, 1924 (FREE SERVICE) FOR ANNUITABLE PURPOSES AND TO OMIT PERIODS SUBSEQUENT TO JULY 1, 1924, IN RESPECT OF WHICH PERIOD THE REGULAR FOREIGN SERVICE OFFICERS WERE REQUIRED TO MAKE CONTRIBUTIONS OF 5 PERCENT FROM THEIR COMPENSATION.

THEREFORE, I CONCUR IN THE VIEWS EXPRESSED UPON THE THREE POINTS SET FORTH IN THE SECOND PARAGRAPH OF YOUR LETTER.

REFERRING TO THE QUESTION IN THE PENULTIMATE PARAGRAPH OF YOUR LETTER, THE STATUTE REQUIRES THAT OPTIONAL PAYMENTS FOR LONGEVITY CREDITS COVERING PAST SERVICE SHALL BE MADE BY THE "OFFICER" AND PROVIDES THAT INSTALLMENT PAYMENTS MAY BE MADE "DURING THE CONTINUANCE OF THEIR SERVICE.' ALSO, THE ELECTION TO INCLUDE OR EXCLUDE MILITARY SERVICE FOR WHICH A PENSION WOULD BE PAYABLE IS LIMITED TO A FOREIGN SERVICE OFFICER. WHEN A PROVISION OF THE FOREIGN SERVICE RETIREMENT ACT IS INTENDED TO APPLY TO A RETIRED OFFICER, THE STATUTE USES THE TERM "RETIRED OFFICER" OR "ANNUITANT.' SEE SECTION 26 (E) AND (I), AS AMENDED BY THE ACT OF APRIL 24, 1939, 53 STAT. 585, 586. YOU ARE ADVISED, THEREFORE, THAT RETIRED FOREIGN SERVICE OFFICERS OR ANNUITANTS ARE NOT ENTITLED TO INCREASE THEIR ANNUITY BY PURCHASING ADDITIONAL LONGEVITY CREDITS UNDER THE TERMS OF SECTION 26 (O) OF THE FOREIGN SERVICE RETIREMENT ACT, AS AMENDED BY THE ACT OF AUGUST 5, 1939. SEE DECISION OF SEPTEMBER 9, 1939, B-5660, 19 COMP. GEN. 340, WHEREIN THE SAME CONCLUSION WAS REACHED UPON A SIMILAR MATTER ARISING UNDER THE CIVIL SERVICE RETIREMENT ACT.