Research - Rehabilitation - Re-Employment

Sgt. Shaft 02/23/2004

Dear Sgt. Shaft:
The Fleet Reserve Association (FRA) is urging all 66 members of the House and Senate Budget Committees to include funding in the FY 2005 Budget Resolution for legislation (S. 1916 and H.R. 3673) that eliminates the drastic reduction in Survivor Benefit Plan (SBP) annuities that now adversely impacts survivors of military personnel who are age 62 and older.

The current program provides 55 percent of SBP covered retired pay for younger spouses - however, the amount decreases to 35 percent of retired pay when survivors become eligible for Social Security. Many retirees and their spouses were not fully aware of this reduction when they enrolled in the program in the early 1970s. As a result, many believe they were betrayed by having been asked to sign an irrevocable contract to pay lifetime SBP premiums.

Senator Mary Landrieu (La.) introduced the Military Survivor Benefits Improvement Act of 2003 (S. 1916), which would eliminate the SBP offset over a 10 year period. Companion legislation (H.R. 3673) to do the same was introduced by Representative Jeff Miller (Fla.) in the House.

FRA - the oldest and largest organization dedicated to enhancing pay and benefits for enlisted members of the U.S. Navy, Marine Corps and Coast Guard - was instrumental in the enactment of the military SBP program in 1972, which was designed to improve the Retired Servicemembers Family Protection Plan. Participants were responsible for paying 60 percent of the costs, while the government was to subsidize the remaining 40 percent. But today's SBP program looks nothing like its FRA predecessor, and its intended value has been greatly diminished by the Social Security offset as well as decreased contributions from the federal government.

Today, military retirees pay for more than 80 percent of SBP costs, while the government only picks up about 19 percent of the costs. By way of comparison, the federal government subsidizes its civilian survivor benefit plans - Federal Employees Retirement System (FERS) and Civil Service Retirement System (CSRS) - at 33 percent and 48 percent, respectively.

Probably the greatest disparity between the two plans is beneficiaries in the federal civilian programs do not experience the same offset incurred by military SBP beneficiaries when they reach the age of 62. It is unconscionable that the men and women of our armed forces and their families, who have given up so much in service to and protection of our country, continue to sacrifice at a time when they are in their greatest need.

FRA is grateful to Rep. Miller and Sen. Landrieu for their leadership in campaigning to restore equity and credibility to this vital program. FRA is again referencing the need for SBP reform in its testimony before Congress this year, and will work diligently for the inclusion of funding in the FY 2005 Budget Resolution and the timely enactment of this important legislation.

We urge those who wish to help reform this unfair and debilitating law to visit the Association's Action Center at http://www.fra.org/action/index.html, click on "Urge Your Elected Official to Support Funding for SBP Reform Legislation" and send a prewritten e-mail letter of support to their congressional representatives.

Sincerely,
Joe Barnes
National Executive Secretary
Fleet Reserve Association

Dear Joe
I echo your praise and support of S. 1916), and (H.R. 3673. I also commend Senator Mary Landrieu (LA) and Representative Jeff Miller (Fla.) for spearheading this vital legislation.

Dear Sgt Shaft
I agree totally that the SBP program is huge injustice for widows of military retired persons. I had ten years active duty plus fourteen years reserve, retiring as an O-6. It has been a long time since I have seen a write-up of the actual SBP provisions, so I do not understand how it affects me (and my wife) personally. Where can I find a good description? From the synopses I have seen so far we would have been better off to have taken the dollars and put them towards an annuity policy instead of wasting them on the SBP program.

Thank you for your help,
Harry J. Wander, COL, AUS, Ret

Dear Henry,
For starters, I suggest that you visit a few of the military organization websites such as the Military Officers Association of America @ www.moaa.org, The Non Commissioned Officers Association, www.ncoausa.org, or The Fleet Reserve Organization @, www.fra.org.

Dear Sarge,
Isn’t it funny:
If Congress wants a pay raise, it's processed with no problems. For those of us "who paid the price" for our country (to keep Congress intact), There’s always some delay.

Take care!
Michael G
Virginia

Dear Michael
The Defense Finance and Accounting Service (DFAS) has announced computer reprogramming has progressed faster than expected and they have made concurrent disability payments (CDP) to about 150,000 eligible retirees on February 1. Those whose CDP will be delayed another month or two include those who divide their retired pay with a former spouse, medical disability retirees who will have their offset only partially eliminated by the new law change, and a few other special situations. DFAS officials believe that they will be able to provide payment for all of these retirees no later than the April 1 paycheck.

Send letters to Sgt. Shaft, c/o John Fales, P.O. Box 65900, Washington, D.C. 20035-5900; fax to 301-622-3330; call 202-462-4430 or email sgtshaft@bavf.org.

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