IN THE CASE OF: BOARD DATE: 18 October 2016 DOCKET NUMBER: AR20150018452 BOARD VOTE: ____x____ ___x___ ___x____ GRANT FULL RELIEF ________ ________ ________ GRANT PARTIAL RELIEF ________ ________ ________ GRANT FORMAL HEARING ________ ________ ________ DENY APPLICATION 2 Enclosures 1. Board Determination/Recommendation 2. Evidence and Consideration IN THE CASE OF: BOARD DATE: 18 October 2016 DOCKET NUMBER: AR20150018452 BOARD DETERMINATION/RECOMMENDATION: The Board determined that the evidence presented was sufficient to warrant a recommendation for relief. As a result, the Board recommends that all Department of the Army records of the individual concerned be corrected by: * showing he elected, in a timely manner, not to participate in the Reserve Component Survivor Benefit Plan and his spouse concurred with his election * reimbursing him any premiums paid as a result of this correction _____________X____________ CHAIRPERSON I certify that herein is recorded the true and complete record of the proceedings of the Army Board for Correction of Military Records in this case. IN THE CASE OF: BOARD DATE: 18 October 2016 DOCKET NUMBER: AR20150018452 THE BOARD CONSIDERED THE FOLLOWING EVIDENCE: 1. Application for correction of military records (with supporting documents provided, if any). 2. Military Personnel Records and advisory opinions (if any). THE APPLICANT'S REQUEST, STATEMENT, AND EVIDENCE: 1. The applicant requests correction of his records to show he elected not to participate in the Survivor Benefit Plan (SBP). 2. The applicant states he received his disability orders on 21 January 2015, the same day of his retirement. The Defense Finance and Accounting Service (DFAS) claims because he signed his DD Form 2656 (Data for Payment of Retired Personnel) on 2 February 2015, his coverage defaulted to spouse coverage. It is clear that there was no time between receipt of retirement orders and retirement date to receive SBP counseling. 3. The applicant provides: * DD Form 2656, dated 25 February 2015 (after his retirement) * retirement orders * SBP premium bill * retiree account statement * DD Form 214 (Certificate of Release or Discharge from Active Duty) CONSIDERATION OF EVIDENCE: 1. The applicant and his spouse, Zulma, were married on 23 May 1981. 2. He enlisted in the USAR on 9 September 1983 and he held military occupational specialty (MOS) 63B (Power Generation and Wheel Vehicle Mechanic). He served through multiple reenlistments in variety of troop program units and he attained the rank/grade of staff sergeant (SSG)/E-6. 3. On 8 October 2003, the USAR Command, St. Louis, MO issued him a Notification of Eligibility for Retired Pay at Age 60 (20-year letter). Instructions within this letter state that Reserve Component SPB (RCSBP) is automatic by Public Law 106-398, dated 30 October 2000, for service members who are married unless written spouse concurrence is provided and an election is made to defer enrollment until age 60, enroll spouse and children at a lower rate, or enroll children only. If no election (document) was received from the Soldier and spouse effecting enrollment, then the deferred election was an immediate annuity should the Soldier die before age 60. 4. He entered active duty on 1 November 2004 and subsequently served in Kuwait from 21 December 2004 to 16 December 2005. Upon his release from active duty, he continued to serve as a member of the USAR in a troop program status. 5. In August 2012, he injured his knee in Puerto Rico while unloading a van during Reserve training. He then entered the integrated disability evaluation system (IDES) as a member of the Reserve Component, not on active duty. 6. On 26 November 2014, an informal physical disability evaluation board (PEB) convened and found the applicant's condition unfitting. The PEB found the applicant physically unfit and recommended a combined rating of 100 percent and that his disposition be "placement on the temporary disability retired list (TDRL)." He concurred. 7. On 17 December 2014, he was issued orders placing him on the TDRL in the rank/grade of SSG/E-6 effective 21 January 2015. 8. On 25 February 2015 after his retirement, he completed in the presence of a Retirement Services Officer (RSO) a DD Form 2656. This form shows: * he was married to Zulma and his date of marriage was 23 May 1981 * they have one dependent child who was born in December 1997 * he elected not to participate in the SBP; he and the RSO signed this form on 25 February 2015 * his spouse signed this form and she had her signature notarized, on 25 February 2015 9. On 27 January 2016, a TDRL PEB considered his condition and found his condition remained unfit but sufficiently stable for final adjudication. The TDRL PEB recommended his permanent retirement at a 30-percent disability rating. He concurred. 10. On 23 February 2016, orders were issued removing him from the TDRL and permanently retiring him effective 23 February 2016 due to permanent disability. 11. He provided evidence showing that in July 2015, he received an SBP premium bill informing him that he owed back premiums at the monthly rate of $177.79, for a total of $715.50. Additionally, his retiree account statement reflects he has "spouse and children" SBP coverage at a monthly rate of $177.65. REFERENCES: 1. Public Law 92-425, enacted 21 September 1972, established the SBP. The SBP provided that military members on active duty could elect to have their retired pay reduced to provide for an annuity after death to surviving dependents. An election, once made, was irrevocable except in certain circumstances. This law also provides that every member having a spouse and/or child(ren), who retired/transfers to the retired list on or after that date, is automatically covered under SBP at the maximum rate unless he/she elected otherwise before retirement or transfer to the retired list. 2. Public Law 95-397, the Reserve Component SBP, enacted 30 September 1978, provided a way for those who had qualified for reserve retirement but were not yet age 60 (and participate in SBP), to provide an annuity for their survivors should they die before reaching age 60. Three options are available: (A) elect to decline enrollment and choose at age 60 whether to start SBP participation; (B) elect that a beneficiary receive an annuity if they die before age 60 but delay payment of it until the date of the member’s 60th birthday; (C) elect that a beneficiary receive an annuity immediately upon their death if before age 60. If death does not occur before age 60, the RCSBP costs for options B and C are deducted from the member’s retired pay (costs for option C being the more expensive). Once a member elects either Options B or C in any category of coverage, that election is irrevocable. Option B and C participants do not make a new SBP election at age 60. They cannot cancel SBP participation or change options they had in RCSBP – it automatically rolls into SBP coverage. If RCSBP Option B or C is elected, there is a Reservist Portion cost added to the basic cost of the SBP to cover the additional benefit and assured protection should the member have died prior to age 60. 3. Public Law 106-398, enacted 30 October 2000, required written spousal consent for a Reserve service member to be able to delay making an RCSBP election until age 60. The law is applicable to cases where 20-year letters have been issued after 1 January 2001. In other words, failure to elect an option now results in the default election of option C. The declination, with the spouse's consent, must be made before the end of the 90-day period beginning on the date on which the member receives his/her 20-year letter. 4. Title 10 U.S. Code (USC), section 1448, required notice to a spouse if a member elected not to participate in the SBP. The statute also provided for automatic enrollment for spouse coverage at the full base amount unless a member affirmatively declined to participate in the SBP prior to receiving retired pay. Title 10 USC, section 1448 was amended effective 1 March 1986 to require written concurrence by the spouse in a member's decision to decline the SBP or elect spouse coverage at less than the full base amount. 5. Public Law 105-85, enacted 18 November 1997, established the option to terminate SBP participation. Retirees have a 1-year period beginning on the second anniversary of the date on which their retired pay started, to withdraw from SBP. The spouse's concurrence is required. No premiums will be refunded to those who opt to disenroll. The effective date of termination is the first day of the first calendar month following the month in which the election is received by the Secretary concerned. DISCUSSION: 1. The SBP is a program that is governed by statute. a. When a member is married; makes an SBP election before retiring; and declines SBP coverage, elects children only SBP coverage, or does not elect full spouse coverage, the spouse must concur in writing on or after the date the member made the election but before the member's retirement date. b. The applicant was issued his 20-year letter in 2003. The instructions in his 20-year letter were specific. With his spouse?s written concurrence he could have elected to decline RCSBP. There is no evidence he and his spouse submitted a request to decline RCSBP in 2003. Based on law, RCSBP was automatically initiated for his spouse and child at the full rate and payable upon his death should it occur prior to age 60. c. The applicant was issued TDRL retirement orders on 17 December 2014 and he retired on 21 January 2015. His SBP coverage had defaulted to automatic coverage for spouse and children based on the full amount in 2003, as required by law when he received his 20-year letter. c. After his retirement based on placement on the TDRL, he submitted the DD Form 2656 electing not to participate in the SBP. The RSO counseled him and signed it on that date, and his spouse also concurred and signed it on that date. This form is invalid because it was not submitted during an authorized period. d. Although his spouse signed and notarized this form indicating her concurrence with his election to decline SBP participation, the form was not completed within the prescribed period identified in his 20-year letter. 2. Nevertheless, it is clear the applicant's intent is not to participate in the program. It is equally clear that the RSO did not counsel him properly as evidenced by the RSO's signature after the TDRL retirement date. It also appears that no counseling occurred between the date he received his 20-year letter, his TDRL retirement orders and the date he actually retired. 3. Although there is no government error, the applicant should not be penalized for the RSO's failure in the counseling process. A correction may be in order to show he elected not to participate in the RCSBP and his spouse concurred with his election upon receipt of his 20-year letter. //NOTHING FOLLOWS// ABCMR Record of Proceedings AR20150000953 Enclosure 1 ARMY BOARD FOR CORRECTION OF MILITARY RECORDS RECORD OF PROCEEDINGS ABCMR Record of Proceedings (cont) AR20150018452 2 ARMY BOARD FOR CORRECTION OF MILITARY RECORDS RECORD OF PROCEEDINGS Enclosure 1 ABCMR Record of Proceedings (cont) AR20150018452 5 ARMY BOARD FOR CORRECTION OF MILITARY RECORDS RECORD OF PROCEEDINGS Enclosure 2