BOARD DATE: 28 November 2017 DOCKET NUMBER: AR20160003239 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 BOARD DATE: 28 November 2017 DOCKET NUMBER: AR20160003239 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: a. showing the FSM completed and returned a DD Form 1883 and elected Option C (Immediate Annuity) to the proper office within 90 calendar days and it was received and processed by the proper office in a timely manner; and b. paying the applicant an annuity retroactive to 25 June 2014, the day after the FSM's death. ___________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. BOARD DATE: 28 November 2017 DOCKET NUMBER: AR20160003239 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, the widow of a former service member (FSM), in effect, requests to correct the FSM's records to show she is eligible to receive a Reserve Component Survivor Benefit Plan (RCSBP) annuity and he elected the RCSBP, option C (Immediate Annuity), within 90 days of receipt of his 20-year letter. 2. The applicant states, in effect: a. She married the FSM on 9 May 1985. The FSM was in the military for over 27 years during their marriage. She never saw a 90-day letter. The applicant retired from the federal government in January 2001. She had to complete paperwork to provide survivor benefits for her husband. She was under the impression that the FSM had to do the same for her, and he could not decline to provide survivor benefits for her without her signature. b. The FSM was diagnosed with cancer on 28 March 2014. They discussed the SBP and the FSM believed she was covered because he had to sign her paperwork when she retired covering him for survivor benefits. After the FSM’s death, she had to indicate whether she wanted his military service included in the calculation of his civilian Federal Employee Retirement System (FERS) retirement. She believed that she was covered and elected not to include the military service time. As a result, she received less money in the FSM’s FERS retirement. 3. The applicant provides: * AHRC Form 249 (Chronological Statement of Retirement Points), dated 6 June 2013 * Retired Pay Branch letter, Human Resources Command (HRC), dated 22 May 2014 * Survivor’s Military Service Election, dated 10 July 2014 * DFAS Letter and Accounting Statement, dated 24 July 2014 * Notice of Reclamation, dated 31 October 2014 * DD Form 2565 (Data for Payment of Retired Personnel), dated 12 August 2015 * Letter from Reserve Component (RC) Retirements, dated 23 April 2015 * Affidavit, dated 13 January 2016 * RCSBP fact sheet COUNSEL'S REQUEST, STATEMENT, AND EVIDENCE: 1. Counsel requests to correct the records of the FSM to show that he elected the RCSBP, Option C (Immediate Annuity), within 90 days of receipt of his 20-year letter. 2. Counsel states: a. The deceased FSM served honorably in the United States Army, as an active duty (AD) Soldier and Reserve component (RC) Soldier for over 27 years. He was married to the applicant for 29 years. The FSM had served on AD in the United States Army from 15 February 1978 to 30 January 1985. He had then transferred to the RC on 15 February 1985. His last duty date was 15 February 2002. The applicant was aware that her husband received a 20-year letter on or about 18 November 1999 but had never seen the letter or accompanying paperwork until after her husband's death. It was her understanding throughout her marriage to the FSM, that in the event of her husband's death, she would be awarded RCSBP, as she had never signed any paperwork indicating she waived such benefits. b. One year before the FSM was due to retire, he signed DD Form 2656, in order to initiate his retirement payments. On page two, section twenty-six, the FSM elected spouse­only coverage for the survivor benefit plan, the FSM received a letter from Human Resources Command (HRC) dated 22 May 2014, indicating that his retiree application had been approved and that he would begin receiving retirement pay. He was eligible for pay on his 60th birthday, which was 9 July 2014. However, the applicant was diagnosed with cancer on 28 March 2014 and on 24 June 2014, just two weeks before his 60th birthday, the FSM passed away. In fact, the Defense Finance and Accounting Service (DFAS) submitted their first retirement payment to him on 24 July 2014. However, once DFAS was made aware of his death, they subsequently recouped the payments. One year later, on 23 April 2015, HRC sent the applicant a letter indicating that she was not covered by the RCSBP due to the fact that DFAS had no record of the FSM returning the Survivor Benefit Election Certificate (DD Form 1883), within 90 calendar days of receiving his 20-year retirement letter. c. Public Law 95-397 was amended to address misinformation delivered to surviving spouses and service members regarding SBP election. Public Law 95-397 was enacted 30 Sept 1978, to provide a mechanism for reserve component members who qualified for reserve retirement but were not yet age 60 and their survivors to receive retirement benefits should they die before reaching age 60. There were three options available: * Option A - elect to decline enrollment until age 60, and then elect whether to start SBP participation. * Option B - elect that a beneficiary receive an annuity if they die before age 60, but delay payment until the date of the member's 60th birthday. * Option C - elect that a beneficiary receive an annuity immediately upon their death if before age 60. * Under the law that was enacted in 1978, failure to make an election within 90 day of the receipt of a RC 20-year letter, defaulted to an Option A, as in the case at hand. d. Public Law 106-398, amended on October 2000, and enacted to require written spousal consent for a Reserve service member to be able to delay making and RCSCP election until age 60. The amended law is applicable to cases where 20-year letters have been issues after 1 January 2001. Moreover, the law was changed in 2001, so that if no election is made within 90 days, the default option is now C, as opposed to A. Under today's law the applicant would have to consent to the declination to select Option C, and failure to make an election within 90 days, defaulted to immediate coverage upon a service member’s before age 60, or option C. e. The applicant spent the last 15 years assuming that she was covered under option C, and that she was covered under SBP in the event that her husband died before age 60, as she never signed a waiver indicating otherwise. Furthermore, after her husband's death she located an "SBP Fact Sheet." This packet states in bold on front page, "Failure to return the election form is an Election." It does not clearly delineate which option is an election. While at around page 20 of the 21 paged packet, it explains that a failure to make an election would yield an election of Option A, in fine print, it is not apparently clear. The applicant believes that her husband was misled by the paperwork and thus did not, to her knowledge, return the election form within his 90-day period. f. The FSM clearly intended for his wife to have SBP coverage and that intention was known by DFAS. In 2013, while the FSM was completing paperwork to set up his retirement payments, he elected his spouse for SBP coverage. After he received a terminal diagnosis he and his wife discussed the financial future and the FSM and the applicant believed at that time that they were fully covered under the SBP. As previously mentioned, DFAS made the first retirement payment to the FSM on 24 July 2014. The pay statement delineated that the SBP premium was deducted from the retirement payment, thus according to DFAS, the applicant was now being covered under SBP. g. The applicant detrimentally relied on the fact that she was going to receive SBP from her husband when she made a FERS election for the FSM’s civilian retirement pay. The FSM worked as a Civilian Government Service employee upon his retirement from the United States Army. He was eligible for retirement benefits under his FERS plan when he passed away. At the time of his passing, the applicant believed that she was eligible for her husband's RCSBP benefits and so she elected to have her husband's military service time not included in the FERS retirement determination. Had the applicant believed that she was not going to receive RCSBP she could have had her husband's military service time computed in the FERS benefits and would have received a higher amount of retirement. h. The FSM served in the United States Army honorably for over 27 years, while married to his devoted wife (the applicant). If the FSM had survived his terminal illness for just 2 more weeks, there would be no dispute that the applicant would be entitled to RCSBP. The law was changed in October of 2000 to address the ambiguity experienced by service members in this exact set of circumstances. Rules of equity should be applied at the very least, to deem the applicant eligible for RC Survivor Benefits. 3. Counsel provides the same documents as the applicant. CONSIDERATION OF EVIDENCE: 1. The FSM was born on 9 July 1954. He enlisted in the United States Army Reserve (USAR) on 15 February 1978, and enlisted in the Regular Army on 14 March 1978, and further enlisted in United States Army Reserve on 15 February 1985. He and the applicant were married on 9 May 1985. 2. On 18 November 1999, the FSM was issued his Notification of Eligibility for Retired Pay at Age 60 (20-year letter). Paragraph 4 of this memorandum described the RCSBP and his entitlement to participate. He was informed he had 90 calendar days from the date he received the notice to submit an election using the enclosed DD Form 1883 (Survivor Benefit Plan Election Certificate). 3. There is no evidence showing the FSM made an RCSBP election within the 90 calendar days from the date he received the letter (20-year letter). 4. Headquarters, 99th Regional Support Command, Coraopolis, PA, Orders 02-057-017, dated 26 February 2002, assigned the FSM to the Retired Reserve effective 1 September 2002. 5. On 12 August 2013, the FSM completed a DD Form 2656, wherein he indicated he was married, and was electing SBP for "spouse only." In item 27a of this form, he checked the box to show he was electing coverage based on full gross pay. The FSM and witnessing official signed the form. 6. On 22 May 2014, HRC approved the FSM’s application for retired pay, and Orders C05-494465, dated the same day, placed him on the Retired List effective 9 July 2014. 7. The FSM died on 24 June 2014 at age 59. His death certificate shows he was married to the applicant at the time of his death. 8. On 23 April 2015, the Chief, Reserve Component Retirements Branch, U.S. Army Human Resources Command, denied the applicant's request for the survivor benefit annuity because by law the FSM had 90 calendar days from the date he received his letter to submit a Survivor Benefit Election Certificate (DD form 1883). If an election was not made within the required 90 calendar days, he would not be entitled to Survivor Benefit coverage until he applied for retired pay at age 60. According to military records, the FSM did not make an election prior to the 90 day suspense nor did he apply for retired pay. Therefore, the applicant was not entitled to any benefits. REFERENCES: 1. Public Law 95-397, the RCSBP, enacted 30 September 1978, provided a way for those who had qualified for Reserve retirement but were not yet age 60 (and eligible to participate in SBP), to provide an annuity for their survivors should they die before reaching age 60. Three options are available. If death occurs before age 60, the RCSBP costs for options B and C are deducted from the annuity. * Option (A) - elect to decline enrollment and choose at age 60 whether to start SBP participation * Option (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 * Option (C) - elect that a beneficiary receive an annuity immediately upon their death if before age 60 2. By law, the DD Form 1883 had to be submitted within 90 calendar days from the date the 20-year letter was received. If it was not submitted within the 90-day timeframe, the Reserve member would not be entitled to survivor benefit coverage until they applied for retired pay at 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 Twenty-Year Letters have been issued after 1 January 2001. 4. Public 108-375, enacted 28 October 2004, established an Open Season from 1 October 2005-30 September 2006. It required that enrollees live two years from the effective date of election for beneficiaries to be eligible for an annuity. This Open Season was extensively publicized in Army Echoes to ensure all retirees were informed of its existence. DISCUSSION: 1. By law and regulation, Reserve Component Soldiers who complete at least 20 years of qualifying service are issued a Twenty-Year Letter that informs them of their retirement eligibility and they are offered the opportunity to enroll in the RCSBP. However, it is not a requirement for them to do so. The law in effect at the time required the Soldier to make an election and return the enrollment form within 90 days of receipt of the Twenty-Year Letter. 2. The evidence of record confirms that after receiving his Twenty-Year Letter the FSM did not elect enrollment in the RCSBP and he effectively deferred his election until age 60. Regretfully, he died on 24 June 2014, just 2 weeks prior to reaching age 60. 3. The FSM died on 24 June 2014 prior to reaching the age of 60 when he would have been eligible to receive retired pay. In addition, the FSM had the option to enroll the applicant in the RCSBP during an open season. There is no evidence that he did so. 4. The FSM's Twenty-Year Letter is dated 18 November 1999. 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; however, the law was not applicable to Twenty-Year Letters issued before 1 January 2001. 5. Based on the evidence presented in this case, it is reasonable to conclude the applicant assumed she was covered by RCSBP. She opted not to add the FSM’s military service into his FERS account for the purposes of maximizing her benefits when it would have clearly been to her advantage to do so. The applicant made this decision based on the FSM’s application for election of RCSBP and a retirement approval letter from HRC. The evidence would support a recommendation to correct the record, as a matter of equity, to show the FSM elected the RCSBP annuity and he elected Option C (Immediate Annuity) within 90 days of receipt of his Twenty-Year Letter, thereby entitling the applicant to the RCSBP annuity. //NOTHING FOLLOWS// ABCMR Record of Proceedings AR20150000953 Enclosure 1 ARMY BOARD FOR CORRECTION OF MILITARY RECORDS RECORD OF PROCEEDINGS ABCMR Record of Proceedings (cont) AR20160003239 2 ARMY BOARD FOR CORRECTION OF MILITARY RECORDS RECORD OF PROCEEDINGS Enclosure 1 ABCMR Record of Proceedings (cont) AR20160003239 7 ARMY BOARD FOR CORRECTION OF MILITARY RECORDS RECORD OF PROCEEDINGS Enclosure 2