2012 cost-of-living adjustment for federal military pensions

2012/uipl07-12acc.pdf (https://www.dol.gov/sites/dolgov/files/ETA/advisories/UIPL/2012/uipl07-12acc.pdf)

                                                            CLASSIFICATION
   EMPLOYMENT AND TRAINING ADMINISTRATION                   UI
               ADVISORY SYSTEM                              CORRESPONDENCE SYMBOL
                                                            OUI/DUIO
          U.S. DEPARTMENT OF LABOR
                                                            DATE
             Washington, D.C. 20210                         January 11, 2012



ADVISORY:          UNEMPLOYMENT INSURANCE PROGRAM LETTER NO. 07-12

TO:                STATE WORKFORCE AGENCIES

FROM:              JANE OATES /s/
                   Assistant Secretary

SUBJECT:           Federal Military Pensions

1. Purpose. To ensure State Workforce Agencies are aware of the Federal military retired pay
annual cost of living adjustment (COLA) provided by the Department of Defense.

2. Background. The military COLA is based on the previous year’s Consumer Price Index.
Military COLA increases will be effective December 1, 2011. Military retired pay, by law, is
always rounded down to the next lower dollar amount. The term “retired pay” includes retainer
pay and the term “member” includes former members.

3. COLA for Retired Pay. The COLA for 2012 will increase for those individuals who first
became a member of a uniformed service before, on, or after September 8, 1980. Please see
attachment for detailed information.

4. Instructions. States with laws that require a reduction of the unemployment insurance weekly
benefit amount by the prorated weekly amount of retired pay and pensions should identify
claimants affected by the COLA increases and make the appropriate reductions as required by
state law.

5. Action Requested. State Administrators are requested to provide the above information and
attachment to appropriate staff.

6. Inquiries. Please direct all inquiries to the appropriate Regional Office.

7. Attachment. Adjustment to Retired/Retainer Pay, Survivor Annuities and Premiums,
Effective December 1, 2011.




 RESCISSIONS                                               EXPIRATION DATE
 None                                                      January 1, 2013

2012/uipl07-12a1.pdf (https://www.dol.gov/sites/dolgov/files/ETA/advisories/UIPL/2012/uipl07-12a1.pdf)

          FISCAL YEAR 2012 ADJUSTMENTS TO RETIRED/RETAINER PAY,
                    SURVIVOR ANNUITIES AND PREMIUMS

The following Cost-of-Living Adjustments (COLAs) are effective December 1, 2011, based on
the increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers
(CPI-W) through the third quarter calendar year 2011. The term “retired pay” includes retainer
pay and the term “members” includes former members.

                                     COLAs for Retired Pay

1.   The retired pay COLA for those who first became a member of a Uniformed Service before
     September 8, 1980, is specified according to the effective date of their retirement, as
     follows:

     Retired Pay Based on
     Rates of Pay Effective                   Percent Increase       10 U.S.C. Authority
     Before January 1, 2011                   3.6 percent            1401a(b)(2)
     January 1 – December 31, 2011            3.6 percent            1401a(c)

2.   The retired pay COLA for those who first became a member of a Uniformed Service on or
     after September 8, 1980, is specified according to the effective date of their retirement, as
     follows:

     Retirement Effective                     Percent Increase       10 U.S.C. Authority
     Before January 1, 2011                   3.6 percent            1401a(b)(2)
     January 1 – March 31, 2011               3.6 percent            1401a(d)
     April 1 – June 30, 2011                  2.4 percent            1401a(d)
     July 1 – September 30, 2011              0.4 percent            1401a(d)
     October 1 – December 31, 2011            0.0 percent            1401a(d)

3.   The retired pay COLA for those who first became a member of a Uniformed Service on or
     after August 1, 1986, and also elected to receive a career status bonus under the provisions
     of section 322 of title 37 United States Code is specified according to the date of their
     retirement, as follows:

     Retirement Effective                     Percent Increase       10 U.S.C. Authority
     Before January 1, 2011                   2.6percent             1401a(e)
     January 1 – March 31, 2011               2.6 percent            1401a(e)
     April 1 – June 30, 2011                  1.9 percent            1401a(e)
     July 1 – September 30, 2011              0.1 percent            1401a(e)
     October 1 – December 31, 2011            0.0 percent            1401a(e)





                                   COLAs for Survivor Annuities

4.   Retired Serviceman’s Family Protection Plan annuities payable on December 1, 2011,
     under the provisions of subchapter I of chapter 73, title 10, United States Code, to the
     spouse or child of a member who died on or before March 20, 1974 will be increased by
     3.6 percent (ref: 10 U.S.C. 1434 (e)).

5.   Annuities under the Survivor Benefit Plan (SBP) and Reserve Component Survivor Benefit
     Plan (RCSBP) under the provisions of the subchapter II of chapter 73, title 10, United
     States Code; will be increased by the same percentage specified in paragraphs 1, 2, or 3
     above by which the retired pay of the person providing the annuity would have been
     increased at such time if the person were alive and otherwise entitled to such pay. (ref: 10
     U.S.C. 1451 (g)).

6.   COLAs for supplemental annuities paid to certain low income widows of members who
     were deceased before November 1, 1953 will be increased 3.6 percent (ref: section 653 (c),
     Public Law 100-456, section 653).

7.   Annuities for Certain Military Surviving Spouses (ACMSS) payable monthly under the
     provisions of section 644, Public Law 105-85, November 18, 1997, will be increased 3.6
     percent from $229.89 to $238.17 effective December 1, 2011. (ref: P.L. 105-85, sec 644).

                     Increase in the SBP Low-Cost Premium Threshold

8.   Previous amounts with respect to which the 2.5 percent factor of the SBP premium (cost)
     formula apply will be adjusted effective December 1, 2011, in conjunction with the
     adjustments in retired pay made under the provisions of section 1401a of title 10, United
     States Code (ref: 10 U.S.C. 1452(a)(4)(B)). The Defense Finance and Accounting Service
     will perform necessary calculations to determine actual premiums based on the individual
     circumstances of each case.

9.   The amount with respect to which the 2.5 percent factor of the SBP premium (cost) is
     applied for participation upon retirement will be increased 1.6 percent effective
     January 1, 2012, from $735 to $747 (premium for this coverage will be $18.68 and the
     breakeven base amount will be $1,600.72). However, these amounts could change if the
     FY 2012 National Defense Authorization Act alters the expected military pay raise of 1.6
     percent. (ref: 10 U.S.C. 1452(a)(4)(A)).