IN THE CASE OF: BOARD DATE: 23 October 2020 DOCKET NUMBER: AR20200000552 APPLICANT REQUESTS: correction of his military records to show he elected not to participate in the Survivor Benefit Plan (SBP). APPLICANT'S SUPPORTING DOCUMENTS CONSIDERED BY THE BOARD: * DD Form 149 (Application for Correction of Military Record) * Congressional email * Personal Statement * Multiple letters to and from the Defense Finance and Accounting Services (DFAS) * DD Form 1883 (Survivor Benefit Plan (SBP) Certificate) * Reserve Component Supplemental SBP * Final Divorce Decree * Marriage Certificate * DD Form 2656 (Data For Payment of Retired Personnel) FACTS: 1. The applicant states he is writing to change his record to reflect that he elected not to participate in the SBP, which was certified by his unit and then concurred with by his current spouse on a DD Form 2656 signed by all parties on 30 August 2018, prior to his retirement. During the year since his retirement, he made numerous phone calls and wrote four letters to the Defense Finance and Accounting Service (DFAS) office requesting to suspend his SBP payments, to which he received no response. It was not until he contacted his Congressman that DFAS finally responded on 15 October 2019 with a letter explaining the situation and denying his request. This letter did, however, offer three non-exclusive options for him to pursue. There is an error and injustice in the records pertaining to his SBP. In the event the Board denies his request, he asks the Board to review the determinations by an appeal to the Defense Office of Hearings and Appeals (DOHA). ·Regarding the first option, the following reasons support the basis for a determination that his record is in error and unjust: a. He was never informed by the personnel office that the program was irrevocable upon his divorce from K-e (the name of his spouse) in 19. Additionally, at no time did the personnel office inform him that the spousal coverage would extend automatically to subsequent spouses. One would naturally believe that an election of spousal coverage would apply only to a current spouse and would cease to exist after a divorce. At the very least, a notification from the personnel office upon his divorce should have been provided, stating that to be the case and alerting met a potential "automatic" extension to any new, future spouse. b. Upon submitting the Marriage License into his personnel file for marriage to his current spouse, K-n (the name of his current spouse), the personnel office did not inform him that any opt out of the SBP program needed to occur within one year after his marriage. c. The personnel office's apparent lack of knowledge of this policy and failure to notify him of opt out requirements is confirmed and validated by the personnel office's efforts to help stop the program by submitting a letter on his behalf on 13 February 2019, along with his divorce decree and a completed and certified DD Form 2656-6 on 2 April 2019 requesting to suspend the coverage based on his divorce from K-e. d. As evidenced by the attached documents that were completed prior to and after his retirement on 30 September 2018, he clearly was unaware of this dormancy policy and received no notification or information regarding the automatic extension and opt out. He reasonably thought that the payments for the SBP program were a merely a mistake since his previous spouse was listed as the beneficiary on his Retiree Account Statement for the first several months. e. It seems clear that the personnel office did not understand the SBP program and the subject policies and, if it did, failed to properly communicate the correct information. It failed to provide him with proper written notification of important options at critical junctures in his life. Similarly, at no time were there any verbal discussions explaining when a service member can elect to opt out of the program. f. To add to the unfairness of the situation, it took almost a year for DFAS to finally send a letter providing the historical information and explanation of why DFAS continued to deduct from his retirement pay for the SBP program. But again, that only occurred because he created a Congressional Inquiry by contacting his Congressman. g. In sum, there has been a significant lack of information and transparency from the personnel office for the SBP program. Had he received proper information, notification and responses throughout any of the relevant points in the process, he could have discontinued the coverage in time to prevent the deductions to his retirement pay, which would have allowed him to receive the full benefits to which he is entitled to after over 42 years of service. This is an unintended consequence that, if not properly addressed, will result in an erroneous, unjust and unreasonable circumstance. He requests that the Board grant removal from the SPB program effective 30 August 2018 which will enable DFAS to retroactively reimburse him the over $6,000.00 that has been deducted from his retirement to date. Absent a determination of this nature, he desires to seek review by submitting an appeal to the DOHA. h. As a final note, he offers some constructive written recommendations to the personnel office to help improve SBP procedures and ensure fair and reasonable notification to prevent the situation from happening to other Soldiers in the future. Having been through this experience, he wants to be as constructive and helpful to the ongoing process as he can. 2. Review of the applicant's service records shows: a. He was born in 19 and turned years of age in. He and K-e were married on September. b. Having had prior active service, he served in the Army National Guard (ARNG) from 1 March 1982 to 29 September 2018, rising in the ranks to major general (MG). c. On 20 February 1997, the Nevada ARNG issued him a Notification of Eligibility for Retired Pay at Age 60 (20-Year Letter). d. On 6 March 1997, within 90 days of receiving his 20-Year Letter, he completed a DD Form 1883 (SBP Election Certificate). He indicated he was married to K-e, and elected Reserve Component Survivor Benefit Plan (RCSBP) under Option C (immediate annuity) based on the full amount. He and his spouse at the time authenticated this form with their signatures. The DD Form 1883 contains the statement: Important: The decision you make with respect to participating in the Survivor Benefit Plan is a permanent, irrevocable decision. Please consider your decision and its effects carefully e. On 2 September, he an K-e divorced. Their Final Divorce Decree incorporated their Property Settlement Agreement. Both documents are silent with respect to the SBP. f. On 16 October 2016, he and K-r were married. g. In or around November 2018, he submitted an Application for Retired Pay (DD Form 108), opting to retire on 29 September 2018. With his application, he included a DD Form 2656 (Data for Payment of Retired Personnel), dated 20 August 2018, wherein he indicated that he was married to K-r and they had no dependent children. He elected not to participate in the SBP. His spouse concurred with his election. h. On 4 October 2018, the Nevada ARNG published orders transferring him to the Retired Reserve effective 29 September 2018. i. On 31 December 2018, the U.S. Army Human Resources Command published orders placing him on the Retired List in his retired grade of MG effective 30 September 2018. j. On 13 February 2019, he wrote to DFAS and requested termination of his SBP. He enclosed his previous divorce decree. k. On 30 April 2019, he again wrote to DFAS requesting assistance to immediately stop deducting SBP premiums from his retired pay. He provided DFAS similar information as provided in his current application. He argued that this deduction should have never been implemented since his divorce occurred 21 years before he retired, and that as a result of the divorce the SBP should have at a minimum gone into a "Suspended Coverage" status. Additionally, he stated that the benefit should have never become effective since his former spouse remarried in March of 2002, clearly prior to the age of 55 and is still married to her current spouse today. l. On 16 May 2019, he wrote to DFAS a third time requesting assistance to immediately stop deducting the SBP from his retirement pay. He argued that DFAS has been incorrectly deducting SBP costs from his retirement pay. He never requested to convert his SBP to former spouse coverage within the one year of our divorce. m. DFAS wrote back pertaining to his request to decline participation in RCSBP. The DAFS letter stated that RCSBP allows retired members of the Uniformed Services an opportunity to provide a portion of their retirement pay to their surviving beneficiaries. Reserve service members are afforded an opportunity to make an RCSBP election in conjunction with receipt of their 20 years letter (DOD Financial Management Regulation (FMR), Volume 7B, Chapter 54). (1) The bottom line up front is that the deductions that have been made are valid and DFAS cannot currently discontinue his coverage. He voluntarily elected Spouse Coverage, Option C, immediate, on 17 April 1997, which was within the 90 day requirement to elect coverage. His spouse at the time acknowledged that election. (2) His spousal coverage was suspended by operation of law upon his divorce in 1997. However, an election for spouse coverage is generally irrevocable, cannot be changed when retired pay commences, and extends automatically to subsequent spouses. The coverage becomes effective at the one-year anniversary of the subsequent marriage, unless the member makes notification within one year of the marriage that they do not wish to cover the new spouse. (3) Since DFAS received no documentation from the Army that he declined RCSBP coverage within one year of marriage to K-r, she was established as his RCSBP beneficiary automatically effective October 16, 2017. If, hypothetically, he had passed away on October 17, 2017, K-r would have been entitled to an annuity (DOD FMR Volume 7B, Chapter 44, Part 2B). Moreover, since K-r was already established as his spouse category RCSBP beneficiary when his retired pay commenced, she became his SBP beneficiary by operation of law. (4) On September 30, 2018, he reached the requisite age for entitlement to retired pay and his retired pay commenced. Reductions from his retired pay commenced as well to include both (a) "Tack-On Costs" for RCSBP spouse coverage (representing coverage provided to K-e before his divorce and to K-r after his marriage and before September 30, 2018) and (b) costs for SBP spouse coverage for K-r since September 30, 2018. Retired members that elect to participate in RCSBP will have premiums for the Tack-On cost withheld from their retired pay account each month along with the spouse cost from their date of retirement until they have paid costs for a total of 360 months, become deceased, or lose their beneficiary, whichever occurs first. (DOD FMR Volume 7B, Chapters 44 and 54.) (5) If he has evidence that he declined RCSBP coverage for K-r within one year of his marriage (by submitting a request to decline coverage to the Army), he can contact the DFAS Retired & Annuitant Pay. If he did not notify the branch to discontinue SBP within one year of your marriage to K-r, he may consider pursuing any or all of the following options: (1) Application for correction of military records to the ABCMR; (2) Appeal to DOHA; or (3) Request to discontinue participation during a 1-year period, which begins on the second anniversary of the date of commencement of retired pay. 3. References: See references page. BOARD DISCUSSION: 1. After reviewing the application and all supporting documents, the Board found that relief is not warranted. 2. The Board found the applicant's SBP coverage was correctly administered under the applicable statute. The Board found insufficient evidence to support a conclusion that there was insufficient information available regarding the irrevocable nature of his original RCSBP election for spouse coverage. Based on a preponderance of evidence, the Board determined there is no error or injustice in the applicant's ongoing participation in SBP with coverage for his spouse. 3. The Board noted the applicant became eligible to withdraw from SBP when he reached the second anniversary of the date he began to receive retired pay. Under the statute governing SBP, he has 1 year from the date of his second anniversary of receipt of retired pay to submit an application to withdraw from the plan. His spouse's concurrence is required. BOARD VOTE: Mbr 1 Mbr 2 Mbr 3 : : : GRANT FULL RELIEF : : : GRANT PARTIAL RELIEF : : : GRANT FORMAL HEARING :X :X :X DENY APPLICATION BOARD DETERMINATION/RECOMMENDATION: The evidence presented does not demonstrate the existence of a probable error or injustice. Therefore, the Board determined the overall merits of this case are insufficient as a basis for correction of the records of the individual concerned. 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. REFERENCES: 1. Title 10, United States Code, section 1448, the program established by this subchapter shall be known as the Survivor Benefit Plan. The following persons are eligible to participate in the Plan: (A) Persons entitled to retired pay, and (B) Persons who would be eligible for reserve-component retired pay but for the fact that they are under 60 years of age. The Plan applies to the following persons, who shall be participants in the Plan: a. (A) Standard annuity participants.— A person who is eligible to participate in the Plan under paragraph (1)(A) and who is married or has a dependent child when he becomes entitled to retired pay, unless he elects (with his spouse’s concurrence, if required under paragraph (3)) not to participate in the Plan before the first day for which he is eligible for that pay. b. (B) Reserve-component annuity participants.— A person who (i) is eligible to participate in the Plan under paragraph (1)(B), and (ii) is married or has a dependent child when he is notified under section 12731(d) of this title that he has completed the years of service required for eligibility for reserve-component retired pay, unless the person elects (with his spouse’s concurrence, if required under paragraph (3)) not to participate in the Plan before the end of the 90-day period beginning on the date on which he receives that notification. A person who elects under subparagraph (B) not to participate in the Plan remains eligible, upon reaching 60 years of age and otherwise becoming entitled to retired pay, to participate in the Plan in accordance with eligibility under paragraph (1)(A). 2. 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. 3. 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 to provide an annuity for their survivors should they die before reaching age 60. Three options are available: * 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 4. Once a member elects either option B or option 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 the RCSBP - the options automatically roll 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. 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. 6. Department of Defense Instruction (DODI) 1332.42, Survivor Annuity Program Administration (23 June 2009), enclosure 3, paragraph 7 states that a member who is a participant in SBP or RCSBP for spouse or spouse and child coverage and who does not have a current eligible spouse beneficiary may, within one year of remarriage: (1) elect to retain the same level of coverage in effect prior to remarriage; (2) elect not to provide coverage for the new spouse, such an election is irrevocable and requires the Secretary concerned to notify the spouse of the election; or, (3) elect to increase coverage if currently providing less-than-maximum coverage. In the case of a member not making an election within one year following remarriage, the new spouse shall become an eligible beneficiary as though the member had made an election and coverage will resume at the level in effect prior to remarriage with costs accruing upon the first anniversary of the marriage. 7. According to the official Defense Office of Hearings and Appeals website (https://ogc.osd.mil/doha/faq-cd.html), the Claims Division settle claims involving uniformed service members' pay, allowances, travel, transportation, payments for unused accrued leave, retired pay, and survivor benefits, both within and outside of DoD; requests by uniformed service members of all services and civilian employees of DoD that the government waive debts they owe to the government resulting from the erroneous overpayment of pay and allowances (including travel and relocation); and certain contractual and quasi-contractual claims by individuals and commercial entities which traditionally have not been under the jurisdiction of the Board of Contract Appeals. Within DOD, claims are adjudicated with the component concerned, which in most cases within DOD is the Defense Finance and Accounting Service (DFAS). It is the claimant's responsibility to submit a claim to the proper place. You must be cognizant of the period of time you have to file your claim because if you do not submit your claim so that it is received by the component concerned within the time limit allowed by statute, your claim may be barred by the statute of limitations. Filing the claim somewhere other than the component concerned will not toll the Statue of Limitations. //NOTHING FOLLOWS// ABCMR Record of Proceedings (cont) AR20200000552 8 ARMY BOARD FOR CORRECTION OF MILITARY RECORDS RECORD OF PROCEEDINGS 1