PROGRAM TO PROVIDE SUPPLEMENTAL SPOUSE ANNUITY FOR MILITARY RETIREES

SEC. 1404. PROGRAM TO PROVIDE SUPPLEMENTAL SPOUSE ANNUITY FOR MILITARY RETIREES (a) Establishment of Program.—(1) Effective on October 1, 1991,chapter 73 of title 10, United States Code, is amended by adding at the end the following new subchapter: “SUBCHAPTER III—SUPPLEMENTAL SURVIVOR BENEFIT PLAN “Sec. “1456. Supplemental spouse coverage: establishment of plan; definitions. “1457. Supplemental spouse coverage: payment of annuity; amount. “1458. Supplemental spouse coverage: eligible participants; elections of Coverage. “1459. Former spouse coverage: special rules. 103 STAT. 1580 “1460. Supplemental spouse coverage: reductions in retired pay. “1460a. Incorporation of certain administrative provisions. “1460b. Regulations. “§ 1456. Supplemental spouse coverage: establishment of plan; definitions “(a) Establishment of Supplemental Survivor Benefit Plan.— “(1) Plan.—The Secretary of Defense shall carry out a program in accordance with this subchapter to enable participants in the Survivor Benefit Plan who are providing coverage for a spouse or former spouse beneficiary under that Plan to also provide a supplemental annuity for that spouse or former spouse beginning when the participant dies or when the spouse or former spouse becomes 62 years of age, whichever is later, in order to offset the effects of the two-tier annuity computation under the Survivor Benefit Plan. “(2) Name of plan.—The program under this subchapter shall be known as the Supplemental Survivor Benefit Plan. “(b) Definitions.— “(1) Incorporation of definitions applicable to survivor benefit plan.—The definitions in section 1447 of this title apply in this subchapter. “(2) Supplemental spouse annuity defined.—In this subchapter, the term ‘supplemental spouse annuity’ means an annuity provided to a spouse or former spouse under this subchapter. “§ 1457. Supplemental spouse coverage; payment of annuity; amount “(a) Commencement of Annuity.—A supplemental spouse annuity commences on the later of— “(1) the day on which an annuity under the Survivor Benefit Plan becomes payable to the beneficiary; or “(2) the first day of the first month after the month in which the beneficiary become 62 years of age. “(b) Amount of Annuity for Beneficiary of Person Providing Standard Annuity Under SBP.—In the case of a person providing a standard annuity for a spouse or former spouse beneficiary under the Survivor Benefit Plan and providing a supplemental spouse annuity for that beneficiary under this subchapter, the monthly annuity payable to the beneficiary under this subchapter shall be the amount equal to 20 percent of the base amount under the Survivor Benefit Plan of the person providing the annuity. The annuity shall be computed as of the date of the death of the person providing the annuity, notwithstanding that the annuity is not payable at that time by reason of subsection (a). “(c) Amount of Annuity for Beneficiary of Person Providing Reserve-Component Annuity Under SBP.—In the case of a person providing a reserve-component annuity for a spouse or former spouse beneficiary under the Survivor Benefit Plan and providing a supplemental spouse annuity for that beneficiary under this sub-chapter, the monthly annuity payable to that beneficiary under this subchapter shall be determined as follows: “(1) Beneficiary initially 62 years of age or older.—If the beneficiary is 62 years of age or older when the beneficiary becomes entitled to the reserve-component annuity under the 103 STAT. 1581Survivor Benefit Plan, the monthly amount of the supplemental spouse annuity is the difference between— “(A) the amount of the reserve-component annuity under the Survivor Benefit Plan to which the beneficiary would be entitled if that beneficiary were under 62 years of age (as computed under section 1451(a)(2)(A) of this title); and “(B) the amount of the reserve-component annuity to which the beneficiary is entitled (as computed under section 1451(a)(2)(B) of this title). “(2) Beneficiary initially under 62 years of age.—If the beneficiary is under 62 years of age when the beneficiary becomes entitled to the reserve-component annuity under the Survivor Benefit Plan, the monthly amount of the supplemental spouse annuity of that beneficiary (commencing on the date specified in subsection (a)(2)) is the amount by which the beneficiary’s annuity under the Survivor Benefit Plan is reduced (on the same day) under section 1451(d) of this title. “(3) Exclusion of dic offset.—Computations under paragraphs (1) and (2) shall be made without regard to any reduction required under section 1450(c) of this title (or any other provision of law) with respect to the receipt of dependency and indemnity compensation under section 411 of title 38. “(d) Adjustments in Annuities.— “(1) Periodic adjustments (colas).—Whenever annuities under the Survivor Benefit Plan are increased under section 1451(g)(1) of this title (or any other provision of law) or recomputed under section 1451(i) of this title, each annuity under this subchapter shall be increased or recomputed at the same time. The increase shall, in the case of any such annuity, be by the same percent as the percent by which the annuity of that beneficiary is increased or recomputed under the Survivor Benefit Plan. “(2) Rounding down.—The monthly amount of an annuity payable under this subchapter, if not a multiple of $1, shall be rounded to the next lower multiple of $1. “(e) Termination of Annuity,—A supplemental spouse annuity terminates effective as of the first day of the month in which the beneficiary dies or otherwise becomes ineligible to continue to receive an annuity under the Survivor Benefit Plan. “§ 1458. Supplemental spouse coverage: eligible participants; elections of coverage “(a) Coverage.— “(1) In general.—A person who provides an annuity for a spouse or former spouse under the Survivor Benefit Plan may elect in accordance with this section to provide a supplemental spouse annuity for that spouse or former spouse. “(2) Coverage contingent on concurrent sbp coverage.— When a person providing a supplemental spouse annuity under this subchapter ceases to be a participant under the Survivor Benefit Plan, that person’s coverage under this subchapter automatically terminates. “(3) Elections to be voluntary.—A person may not be ordered or required to elect (or to enter into an agreement to elect) to provide a spouse or former spouse with a supplemental spouse annuity under this subchapter. Except as provided in section 1459(h) of this title, in no case shall a person be deemed 103 STAT. 1582to have made an election to provide a supplemental annuity for a spouse or former spouse of such person. “(b) Limitation on Eligibility for Certain SBP Participants Not Affected by Two-Tier Annuity Computation.—A person is not eligible to make an election under this section if (as determined by the Secretary concerned) the annuity of a spouse or former spouse beneficiary of that person under the Survivor Benefit Plan will be computed under section 1451(e) of this title. However, such a person may waive the right to have that annuity computed under section 1451(e) of this title. Any such election is irrevocable. A person making such a waiver may make an election under this section as in the case of any other participant in the Survivor Benefit Plan. “(c) Election of Supplemental Spouse Annuity Before Becoming a Participant in SBP.— “(1) In general.—A person anticipating becoming a participant in the Survivor Benefit Plan who has a spouse or former spouse may elect to provide a supplemental spouse annuity under this subchapter for that spouse or former spouse. “(2) Conditions on election.—An election under paragraph (1)— “(A) must be made before the day on which the person making the election first becomes a participant in the Survivor Benefit Plan; and “(B) shall be made in the same manner as an election under section 1448 of this title that is available to that person at the same time. “(3) Requirement of spouse annuity under sbp.—If upon becoming a participant in the Survivor Benefit Plan under section 1448 of this title the person is not providing an annuity for the person’s spouse or former spouse, an election under this section to provide a supplemental spouse annuity shall be void. “(4) Special rule for rcsbp participants.—For the purposes of this subsection, a person providing a reserve-component annuity under the Survivor Benefit Plan shall not be considered to have become a participant in that Plan until the end of the 90-day period referred to in clause (iii) of section 1448(a0(2)(B) of this title. “(d) Election of Former Spouse After Becoming Eligible tor Survivor Benefit Plan.— “(1) Election of coverage.—A person who elects under section 1448(b)(3) of this title to provide coverage under the Survivor Benefit Plan for a former spouse may elect to provide a supplemental spouse annuity for that former spouse. Any such election must be signed by the person and received by the Secretary concerned within one year after the date of the decree of divorce, dissolution, or annulment. “(2) Effective date of election.—An election under paragraph (1) is effective as of the same day as the election tinder section 1448(b)(3) of this title. “(e) Notice to Spouse of Former Spouse Coverage.—If a married person who is eligible to provide an annuity under the Survivor Benefit Plan elects to provide an annuity under that Plan for a former spouse (or for a former spouse and dependent child) and elects under this section to provide a supplemental spouse annuity for that former spouse, the notification to the personal’s spouse under 103 STAT. 1583section 1448(a)(3)(E) or 1448(b)(3)(D) of this title shall include notice of the election under this section. “(f) Irrevocability of Elections.— “(1) Standard annuity.—An election under subsection (c) to provide a supplemental spouse annuity by a person providing a standard annuity under the Survivor Benefit Plan is irrevocable if not revoked on the day before the date on which the person first becomes a participant in that Plan. “(2) Reserve-component annuity.—An election under subsection (c) to provide a supplemental spouse annuity by a person providing a reserve-component annuity under the Survivor Benefit Plan is irrevocable if not revoked before the end of the 90-day period with respect to that person referred to in clause (iii) of section 1448(a)(2)(B) of this title. “(3) Former spouse elections.—An election under subsection (d) may not be revoked except in accordance with subsection (h). “(g) Remarriage After Retirement.— “(1) Election upon remarriage.—A person— “(A) who is a participant in the Survivor Benefit Plan and is providing coverage under that Plan for a spouse (or a spouse and child) but is not a participant in the Supplemental Survivor Benefit Plan; “(B) who does not have an eligible spouse beneficiary under that Plan; and “(C) who remarries, may (subject to paragraph (2)) elect to provide a supplemental spouse annuity under this subchapter for the person’s spouse. “(2) Limitations on election.—A person may not make an election under paragraph (1) if the person elects under section 1448(a)(6)(A) of this title not to provide coverage under the Survivor Benefit Plan for the person’s spouse. “(3) Conditions on election.—An election under paragraph (1)- “(A) is irrevocable; “(B) shall be made within one year after the remarriage; and “(C) shall be made in such form and manner as may be prescribed in regulations under section 1460b of this title. “(h) Change of Former Spouse Beneficiary to Spouse or Child Beneficiary.—If a person who is providing an annuity for a former spouse under the Survivor Benefit Plan and a supplemental spouse annuity for that former spouse under this subchapter elects under section 1450(f)(1) of this title to change the beneficiary of the annuity under the Survivor Benefit Plan in order to provide an annuity under that Plan to that person’s spouse or to a dependent child— “(1) the beneficiary under the supplemental spouse annuity shall be deemed to be changed to that spouse also, if the change under section 145O(f)(1) was to provide the annuity for the person’s spouse; and “(2) participation in the supplemental spouse annuity program shall be terminated, if the change under section 1450(0(1) of this title was to provide the annuity for a dependent child. “(i) Reinstatement of Discontinued Annuity Upon Reinstatement of SBP Annuity.—If a person who is providing an annuity for a former spouse under the Survivor Benefit Plan and a supplemental spouse annuity for that former spouse under this subchapter discontinues participation in the Survivor Benefit Plan under any 103 STAT. 1584provision of law and subsequently resumes participation in that Plan under any provision of law, the participation of that person in the Supplemental Survivor Benefit Plan under this chapter shall be reinstated effective on the day on which participation in the Survivor Benefit Plan resumes. “§ 1459. Former spouse coverage: special rules “(a) Disclosure of Voluntary Written Agreement With Former Spouse.—A person who elects under section 1458 of this title to provide a supplemental spouse annuity for a former spouse shall, at the time of making the election, provide the Secretary concerned with a written statement (in a form to be prescribed by that Secretary and signed by such person and former spouse) setting forth whether the election is being made pursuant to a written agreement previously entered into voluntarily by such person as a part of or incident to a proceeding of divorce, dissolution, or annulment and (if so) whether such voluntary written agreement has been incorporated in, or ratified or approved by, a court order. “(b) Enforcement of Voluntary Written Agreements Incident to Divorce, Etc.— “(1) Elections deemed to have been made.—If a person who is eligible to elect under section 1458 of this title to provide a supplemental spouse annuity for a former spouse voluntarily enters, incident to a proceeding of divorce, dissolution, or annulment, into a written agreement to elect to provide a supplemental annuity for a former spouse and that agreement is incorporated in or ratified or approved by a court order or is filed with the court of appropriate jurisdiction in accordance with applicable State law, and such person then fails or refuses to make the election as set forth in the voluntary agreement, such person shall be deemed to have made the election if the Secretary concerned— “(A) receives from the former spouse concerned a written request, in such manner as the Secretary shall prescribe, requesting that the election be deemed to have been made; and “(B) receives (i) a copy of the court order, regular on its face, which incorporates, ratifies, or approves the written agreement of such person, or (ii) a statement from the clerk of the court (or other appropriate official) that such agreement has been filed with the court in accordance with applicable State law. “(2) Time limit for request to secretary concerned.—An election may not be deemed to have been made under paragraph (1) in the case of any person unless the Secretary concerned receives a request from the former spouse within one year after the date of the court order or filing involved. “(3) Effective date of deemed election.—An election deemed to have been made under paragraph (1) shall become effective on the first day of the first month which begins after the date of the court order or filing involved. “§ 1460. Supplemental spouse coverage: reductions in retired pay “(a) Reduction Required.—The retired pay of a person who elects to provide a supplemental spouse annuity shall be reduced each month as required under regulations prescribed under subsection (b). 103 STAT. 1585 “(b) Regulations Determining Amount of Reduction.—Regulations for the purposes of subsection (a) shall be prescribed by the Secretary of Defense. Those regulations shall be based upon assumptions used by the Department of Defense Retirement Board of Actuaries in the valuation of military retirement and survivor benefit programs under chapter 74 of this title (including assumptions relating to mortality, interest rates, and inflation) and shall ensure the following: “(1) That reductions in retired pay under this section are made in amounts sufficient to provide that the Supplemental Survivor Benefit Plan operates on an actuarially neutral basis. “(2) That such reductions are stated, with respect to the base amount (under the Survivor Benefit Plan) of any person, as a constant percentage of that base amount. “(3) That the amounts of such reductions in retired pay of persons participating in the Supplemental Survivor Benefit Plan (stated as a percentage of base amount)— “(A) are based on the age of the participant at the time participation in that Plan is first effective under this subchapter; and “(B) are not determined by any other demographic differentiation among participants in the Plan. “(4) That such reductions are otherwise determined in accordance with generally accepted actuarial principles and practices. “(c) Suspension of Reduction When There Is No Spouse Beneficiary.—A reduction in retired pay under this section shall not be made in the case of any person during any month in which there is no eligible spouse or former spouse beneficiary. “(d) Adjustments in Amount of Reduction.—Whenever the amount of the reduction in retired pay of a participant in the Survivor Benefit Plan is increased under section 1452(h) of this title or recomputed under section 1452(i) of this title, the amount of the reduction in that retired pay under this section shall be increased or recomputed, as the case may be, at the same time and in the same manner as that increase or recomputation. “(e) Administrative Provisions.—The provisions of subsections (d) and (f) of section 1452 of this title apply with respect to the participation of a person in the Supplemental Survivor Benefit Plan in the same manner that those provisions apply under the Survivor Benefit Plan. “§ 1460a. Incorporation of certain administrative provisions “(a) Applicability of Certain Provisions of SBP Law.— The provisions of section 1449, 1452(g), 1453, and 1454 of this title are applicable to a person eligible to make an election, and to an election, under this subchapter in the same manner as if made under subchapter II. “(b) Other Applicable Provisions.—Except to the extent otherwise provided in regulations prescribed under section 1460b of this title, the provisions of subsections (h), (i), and (1) of section 1450 of this title apply to supplemental spouse annuities in the same manner that those provisions apply to annuities under the Survivor Benefit Plan. “§ 1460b. Regulations “The President shall prescribe regulations to carry out this subchapter. Those regulations shall, so far as practicable, be uniform 103 STAT. 1586for the uniformed services and shall, so far as practicable, incorporate provisions of the regulations in effect under section 1455 of this title.”. (2) Effective on October 1, 1991, the table of subchapters at the beginning of chapter 73 of such title is amended by adding at the end the following new item: “III. Supplemental Spouse Coverage for Survivor Benefit Plan Participants 1456”. (b) Conforming Amendments.—(1) Section 1331(d) of title 10, United States Code, is amended by inserting “and the Supplemental Survivor Benefit Plan established under subchapter III of that chapter,” after “this title”. (2) Section 3101(c)(1) of title 38, United States Code, is amended by striking out “of subchapter I or II”. (3) The amendments made by paragraphs (1) and (2) shall take effect on October 1, 1991.