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B-266280 1 (1996-03-08)

handle is hein.gao/gaocrptadvb0001 and id is 1 raw text is: 




GAO             United States
                General Accounting Office
                Washington, D.C. 20548

                Office of the General Counsel




                B-266280



                March 8, 1996


                The Honorable Paul D. Coverdell
                United States Senator
                100 Colony Square, Suite 300
                1175 Peachtree Street, NE
                Atlanta, Georgia 30361

                Dear Senator Coverdell:

                This is in response to your letter of September 13, 1995, on behalf of
                Mrs. Mary Gralley, who is seeking a reduction in the amount of the social security
                offset (SSO) being applied to her Survivor Benefit Plan (SBP) annuity, based on the
                calculations of the Defense Finance and Accounting Service (DFAS). Mrs. Gralley's
                husband, Technical Sergeant Phillip W. Gralley, retired from the Air Force in 1962.
                Subsequently, he elected an SBP annuity for his wife payable following his death; he
                died on May 8, 1994.

                Congress established the SBP (10 U.S.C. §§ 1447-1455) in 1972 to complement the
                social security benefits of surviving military dependents. It was intended to provide
                a bridge for survivors by providing them income for the period between the death
                of the member and date of the widow's or widower's eligibility for social security
                benefits. Once the surviving spouse is eligible for social security benefits, the SBP
                annuity is offset, in recognition of the fact that social security benefits are available.
                See 10 U.S.C. § 1451. Mrs. Gralley accepts the appropriateness of the offset, but
                questions the rules governing the manner in which it is applied and calculated.

                There are two methods provided for in the SBP statute by which social security
                benefits are considered in determining the amount an SBP annuity should be
                reduced. In the case of members who did not become eligible for retirement until
                after October 1, 1985, a surviving spouse receives 55 percent of the base amount of
                the member's retired pay until he or she reaches age 62. After age 62, the annuitant
                receives 35 percent of the base amount of the member's retired pay.


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