30 January 2004

Note: The following letter was sent to members of the House and Senate Budget Committees.

Dear Budget Committee Member:

The Fleet Reserve Association (FRA) strongly urges you to include funding in the FY 2005 Budget Resolution for legislation 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 for survivors age 62 and older. 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. Sen. Mary Landrieu= s (La.) Military Survivor Benefits Improvement Act of 2003 (S. 1916) and Rep. Jeff Miller= s expected companion bill in the House would eliminate this offset over a 10-year period. The cost is estimated to be $2.7 billion.

FRA B the oldest and largest organization dedicated to enhancing pay and benefits for members of the U.S. Navy, Marine Corps and Coast Guard B was instrumental in the enactment of the military SBP program in 1972, which was designed to improve the Survivor Benefit Program. Participants were responsible for paying 60 percent of the costs, while the government was to subsidize the remaining 40 percent.

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

It is unconscionable that the men and women of our Armed Forces, who have given up so much in service to and in protection of our country, must ask their spouses to further sacrifice at a time of their greater need.

FRA strongly urges you to help fund and co-sponsor the Military Survivor Benefits Improvement Act of 2003 and other legislation that will authorize military survivor benefits. Thank you for your consideration

National Executive Secretary