RECORD OF PROCEEDINGS


      IN THE CASE OF:


      BOARD DATE:           18 November 2004
      DOCKET NUMBER:   AR2004106544


      I certify that hereinafter is recorded the true and complete record
of the proceedings of the Army Board for Correction of Military Records in
the case of the above-named individual.

|     |Mr. Carl W. S. Chun               |     |Director             |
|     |Mrs. Nancy L. Amos                |     |Analyst              |


      The following members, a quorum, were present:

|     |Mr. James C. Hise                 |     |Chairperson          |
|     |Mr. Lester Echols                 |     |Member               |
|     |Mr. Hubert O. Fry                 |     |Member               |

      The Board considered the following evidence:

      Exhibit A - Application for correction of military records.

      Exhibit B - Military Personnel Records (including advisory opinion,
if any).

THE APPLICANT'S REQUEST, STATEMENT, AND EVIDENCE:

1.  The applicant requests that her records be corrected to show she
elected not to participate in the Survivor Benefit Plan (SBP).

2.  The applicant states that she was not informed before she retired that
her husband would receive only 35 percent of her retired pay under the SBP
due to his age.  That is not cost-effective coverage.

3.  The applicant provides her Retiree Account Statement dated 3 March
2003; her husband's concurrence with her request; a letter from the
applicant to Army Retirement Services dated 3 March 2003 and Army
Retirement Service's response dated 12 March 2003; a letter from the
applicant to Army Retirement Services dated 4 April 2003 and Army
Retirement Service's response dated      22 April 2003; a letter from the
Army Review Boards Agency dated 23 July 2003; a DD Form 2656-2 (Survivor
Benefit Plan (SBP) Termination Request) with a cover letter dated 8
September 2003 and what appears to be an undated response from the Defense
Finance and Accounting Center (DFAS) to the DD Form 2656-2; and a letter
from the applicant to DFAS dated 18 January 2004.

CONSIDERATION OF EVIDENCE:

1.  The applicant was born on 10 August 1938.  She was appointed a major in
the U. S. Army Reserve, Medical Corps, in February 1981.  She was promoted
to Colonel, O-6 on 18 November 1989.  She was placed in the Retired Reserve
effective 1 November 2002 for maximum authorized years of service.

2.  At that time, the applicant completed a DD Form 2656 (Data for Payment
of Retired Personnel).  On the front page, immediately below the title of
the form, is the guidance, "(Please read instructions and Privacy Act
Statement before completing form)."

3.  In section IX of the DD Form 2656 the applicant checked, in item 26,
that she elected SBP coverage for spouse only and, in item 27, that she
elected coverage based on full, gross pay without supplemental SBP.
Section IX is entitled, "Survivor Benefit Plan (SBP) Election (See your
Survivor Benefit Plan counselor before making an election)."

4.  The instructions for completing item 27a are, "Mark if you desire the
coverage to be based on your full gross retired/retainer pay without
Supplemental SBP."

5.  The instructions for completing item 27d are, "Mark if you desire the
coverage to be based on your full gross retired/retainer pay plus
Supplemental SBP…The benefits are paid to a surviving spouse/former spouse
who is age 62 or older."

6.  On 3 March 2003, the applicant appealed to Army Retirement Services for
cancellation of her SBP election.  She contended she did not receive any
briefing on the SBP and so did not know that, because her husband was 75
years of age, the SBP annuity would be reduced to 35 percent of her retired
pay.  Army Retirement Services responded by noting that information on the
SBP annuity percentages was readily available to the applicant through the
Army Home Page or the Army Reserve Homepage.  Further, based on her
Potomac, MD address, she could have contacted the Retirement Services
Officers at Fort Myer, VA, Fort Belvoir, VA, or Fort Meade, MD for
counseling assistance.  Army Retirement Services informed her of the one-
year window between the second and third anniversary following the date she
began to receive retired pay to terminate her SBP coverage.

7.  The applicant wrote back to Army Retirement Services stating that she
was left with the impression that the SBP would amount to 55 percent of her
retired pay, similar to the one in the Federal service.  At no point did it
occur to her that the Army had a different pattern based on the age of the
spouse.  She also noted that the Army does not provide any seminars or
informational booklets to prospective retiring reservists to enable them to
make correct choices in this area.

8.  Public Law 92-425, the SBP, enacted 21 September 1972, provided that
military members could elect to have their retired pay reduced to provide
for an annuity after death to surviving dependents.

9.  Public Law 101-189, enacted 29 November 1989, established the
Supplemental SBP (SSBP).  The SSBP annuity (5, 10, 15 or 20 percent of full
retired pay) would be paid in addition to the standard 35 percent-tier
payment for surviving spouses age 62 and older.

10.  The SBP Counselor Training Manual briefs that “The Subcommittee
believes that the government meets its obligation to survivors in part
through the provision of Social Security, to which it contributes as an
employer; and Social Security, therefore, is the foundation on which the
subcommittee recommends building a new program” (House Armed Services
Committee, Public Law 91-66, 1 October 1970, “Report of Special
Subcommittee on Survivor Benefits”).  SBP provides a
survivor 55 percent of a participant’s military retired pay.  The after-62
benefit amount drops to 35 percent of the retired pay because Social
Security is meant to provide the additional coverage to bring the survivor
support level back up to the 55 percent level.  SSBP provides a means to
increase the after-62 benefit to 40, 45, 50 or 55 percent of the retired
pay.  It is not a government subsidy.

11.  Effective with the Fiscal Year 2005 National Defense Authorization
Act, a phased elimination of the two-tiered annuity computation for
surviving spouses under the SBP was added.  By 2008, the reduction in SBP
payments to offset Social Security payments commencing at age 62 will be
eliminated.

DISCUSSION AND CONCLUSIONS:

1.  The applicant provides insufficient evidence to show that the Army
misinformed her of the SBP annuity her husband could receive.

2.  The applicant contended in her March 2003 letter to Army Retirement
Services that she did not receive any briefing on the SBP.  However, the DD
Form 2656 informed her immediately to "read the instructions."  Section IX
of the DD Form 2656 informed her to see an SBP counselor before making an
election. The instructions for completing item 27d informed her that
"…Supplemental SBP…The benefits are paid to a surviving spouse/former
spouse who is age 62 or older."  That should have warned her that age was a
factor in determining SBP benefits.

3.  The applicant was a senior commissioned officer who lived in Potomac,
MD, within a short driving distance of or a local phone call to three Army
installations. Contrary to her contentions in her April 2003 letter to Army
Retirement Services, the Army does provide seminars and informational
booklets to prospective retiring reservists to enable them to make correct
choices in this area.  She could have received that information from any
one of the three Army installation Retirement Services Officers near her.
She could have learned from them when the next retirement briefing for
active duty soldiers would be presented.  The SBP briefing is always a big
part of those periodic briefings.

4.  The applicant will have a one-year opportunity to terminate her
participation in the SBP beginning 1 November 2004.  It is also suggested
she visit one of her servicing Retirement Services Officers to determine if
the recent change in law would make retention of the SBP worthwhile to her
and her husband.

BOARD VOTE:

________  ________  ________  GRANT FULL RELIEF

________  ________  ________  GRANT PARTIAL RELIEF

________  ________  ________  GRANT FORMAL HEARING

__jch___  __le____  __hof___  DENY APPLICATION

BOARD DETERMINATION/RECOMMENDATION:

The evidence presented does not demonstrate the existence of a probable
error or injustice.  Therefore, the Board determined that the overall
merits of this case are insufficient as a basis for correction of the
records of the individual concerned.




            __James C. Hise_______
                    CHAIRPERSON




                                    INDEX

|CASE ID                 |AR2004106544                            |
|SUFFIX                  |                                        |
|RECON                   |                                        |
|DATE BOARDED            |20041118                                |
|TYPE OF DISCHARGE       |                                        |
|DATE OF DISCHARGE       |                                        |
|DISCHARGE AUTHORITY     |                                        |
|DISCHARGE REASON        |                                        |
|BOARD DECISION          |DENY                                    |
|REVIEW AUTHORITY        |Mr. Chun                                |
|ISSUES         1.       |137.03                                  |
|2.                      |                                        |
|3.                      |                                        |
|4.                      |                                        |
|5.                      |                                        |
|6.                      |                                        |


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