Military Pension Division – Major Change Looming

This is being posted on behalf of Steve Lynch and the Military and Veterans Affairs Committee Member Community.

Family law practitioners who handle military divorces should be aware of a proposed revision to the Uniformed Services Former Spouses’ Protection Act (“FSPA”), 10 U.S.C. § 1408, that may go into effect later this year. The change would mandate use of a single formula nationwide for military pension division (MPD) known as the “Frozen Accrued Benefit” (FAB) method.  FAB divides military retired pay based on the rank and years of service of a servicemember (SM) as of the date of the pension division order (rather than the date of retirement).  The change would invalidate the “Time” rule, used by Ohio and most other States, which calculates MPD based on a formula applied to the actual retired pay of the SM.

The proposed revision is contained in both the House and Senate versions of the National Defense Appropriations Act (NDAA) for FY 2017.  If passed, it is expected to generate some confusion as States adjust to the new methodology; in addition, the revision fails to address key issues, such as the enforceability of settlements that provide for pension division using a non-standard formula.  For more information on the proposed change, including a detailed comparison of the FAB method and the “Time” rule, please consult the attached analysis prepared by Mark E. Sullivan, COL, USA (Ret), Member, Military Committee, ABA Section of Family Law.

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Stephen Lynch
U S Coast Guard
Cleveland OH
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Melissa Quick
Manager of CLE Certification and Specialization
Ohio State Bar Association
Columbus OH
+1 (614 ) 487-2050 x4411