IN THE CASE OF:	  

		BOARD DATE:	        29 July 2008

		DOCKET NUMBER:  AR20080006089


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 that her records be corrected to show she did not elect Survivor Benefit Plan (SBP) coverage.

2.  The applicant states she signed and submitted DD Form 2656 (Data for Payment of Retired Pay) on 30 November 2006 and checked Item 26g (I elect not to participate in SBP).  Her spouse signed the form on 29 November 2006 concurring with her election.  When she began receiving retired pay on 26 January 2008, full SBP was deducted.  The applicant claims that because her husband's signature pre-dated her signature, her election was not honored.

3.  The applicant provides:

	a.  DD Form 2656.

	b.  DFAS-CL Form 7220/148 (Retiree Account Statement) with 3-page attachment "Summary of Retired Pay Account."

	c.  20 May 2008 letter from applicant's spouse stating he understands the ramifications of the applicant's request to cancel SBP coverage and he concurs with that request.


CONSIDERATION OF EVIDENCE:

1.  The applicant is a retired US Army Reserve (USAR) lieutenant colonel.  Her date of retirement was 26 January 2008.  Prior to her retirement, she married on 27 May 2006.

2.  The applicant submitted a copy of DD Form 2656.  In Section IX (Survivor Benefit Plan (SBP) Election), she selected Item 12g indicating that she did not wish to participate in the SBP.  Her spouse signed Section XI (SBP Spouse Concurrence) in Item 30a and dated his signature as 29 November 2006 – the signature was witnessed.  The applicant completed Section XII (Certification) by signing in Item 32a.  She dated her signature on 30 November 2006, and her signature was witnessed on the same date.

3.  The applicant received her first retirement annuity payment on 29 February 2008.  Her DFAS-CL Form 7220/148 shows that an SBP premium was calculated and deducted based on full coverage for spouse only.  The applicant's Summary of Retired Pay Account prepared by DFAS (Defense Finance and Accounting Service) states, "We have not received your SBP Election Certificate, and therefore have provided automatic SBP coverage effective 26 Jan 2008."

4.  On 20 May 2008, the applicant's spouse notified this Board that he concurred in the applicant's request to cancel SBP.  He states that both he and the applicant made the decision not to elect coverage, but that he signed the DD Form 2656 one day prior to the applicant.

5.  The SBP was established by Public Law 92-425 enacted on 21 September 1972, and has been modified by later legislation.  SBP was created so that retiring Soldiers could elect to provide the continuation of a portion of their retired pay to their designated beneficiary.  Retirees pay for SBP coverage with a percentage of their retired pay.  The SBP payment is a pre-tax deduction from retired pay.  SBP changes retired pay from a single-life payout to a joint and survivor payout.  A single-life payout lasts only for the lifetime of the retiree.  While this maximizes the monthly income for the retiree, it eliminates benefits for the surviving spouse.  A joint and survivor payout stretches retired pay over the lifetime of the retiree and the spouse.  Monthly payments are reduced, but they are guaranteed to last over the lifetimes of two people.

6.  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 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 occur before age 60, the RCSBP costs for options B and C are deducted from the annuity (costs for option C being the more expensive).

7.  Public Law 99-145, enacted 8 November 1985, but effective 1 March 1986, required a spouse’s written concurrence for a retiring member’s election that provided less than maximum spouse coverage.  The implementing guidance associated with this law directed that “if any member withdraws from participation for a spouse or spouse and child, that member’s spouse will be notified in the same manner, appropriately documented, as if the member had elected not to participate in the Plan upon retirement.”

DISCUSSION AND CONCLUSIONS:

1.  Although documentation is not contained in the record, it is apparent the applicant did not elect SBP coverage upon notification of her retirement eligibility, either because she chose not to do so, or she was unmarried and had no dependents.  This had the effect of deferring an SBP decision until age 60.

2.  In May 2006, the applicant married.  Later that year, in anticipation of her upcoming receipt of retired pay, she completed DD Form 2656 and elected on 30 November 2006 not to participate in the SBP.  Her spouse concurred with that decision, but dated his concurrence on 29 November 2006, one day before the applicant made her election.  This dating error had the effect of invalidating the SBP election.

3.  It is unclear whether the dating error on the DD Form 2656 played a role in the applicant's automatic enrollment in the SBP.  The DFAS-generated Summary of Retired Pay Account prepared on 29 February 2008 clearly states, "We have not received your SBP Election Certificate, and therefore have provided automatic SBP coverage effective 26 Jan 2008."  [it is actually more likely that DFAS did not pattern its statement to fit the facts of this case.]

4. In any event, it is clear from the applicant's declination of SBP coverage and her spouse's concurrence with that decision that she never intended to take the coverage.  Therefore, it would be appropriate to correct the applicant's record as indicated below.




BOARD VOTE:

__xxx___  __xxx___  __xxx___  GRANT FULL RELIEF 

________  ________  ________  GRANT PARTIAL RELIEF 

________  ________  ________  GRANT FORMAL HEARING

________  ________  ________  DENY APPLICATION

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 that the applicant timely filed DD Form 2656 electing not to participate in the SBP and that her spouse properly concurred in that decision; and

	b.  by cancelling her enrollment in the SBP and refunding to her all premium payments collected.


															XXX
      ______________________
      	   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.

ABCMR Record of Proceedings (cont)                                         AR20080006089



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ABCMR Record of Proceedings (cont)                                         AR20080006089



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