The opinion
UNITED STATES OF AMERICA
MERIT SYSTEMS PROTECTION BOARD
ANTHONY BENNETT, DOCKET NUMBER
Appellant, SF-0842-23-0375-I-1
v.
OFFICE OF PERSONNEL DATE: February 24, 2025
MANAGEMENT,
Agency.
THIS ORDER IS NONPRECEDENTIAL *
Anthony Bennett , Marina, California, pro se.
Jo Bell and Carla Robinson , Washington, D.C., for the agency.
BEFORE
Cathy A. Harris, Chairman
Henry J. Kerner, Vice Chairman
Raymond A. Limon, Member
REMAND ORDER
The appellant has filed a petition for review of the initial decision, which
affirmed a reconsideration decision by the Office of Personnel Management
(OPM) denying his application for a deferred annuity under the Federal
Employees’ Retirement System (FERS). For the reasons discussed below, we
*
A nonprecedential order is one that the Board has determined does not add
significantly to the body of MSPB case law. Parties may cite nonprecedential orders,
but such orders have no precedential value; the Board and administrative judges are not
required to follow or distinguish them in any future decisions. In contrast, a
precedential decision issued as an Opinion and Order has been identified by the Board
as significantly contributing to the Board’s case law. See 5 C.F.R. § 1201.117(c).
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GRANT the appellant’s petition for review, VACATE the initial decision, and
REMAND the case to the regional office for further adjudication in accordance
with this Remand Order.
BACKGROUND
The appellant was a Federal civilian employee from August 5, 1985, to
January 19, 1996, and again from June 3, 2001, to February 20, 2008. Initial
Appeal File (IAF), Tab 7 at 5, 14. He separated from his most recent position
with the Department of Veterans Affairs in February 2008. Id. at 14, 32. On
September 8, 2022, the appellant submitted an application for a deferred or
postponed retirement annuity. Id. at 14-17. He claimed eligibility based on
reaching a FERS Minimum Retirement Age with 10 years of creditable service,
which OPM terms “MRA+10” eligibility or an “MRA+10” annuity. Id. at 5, 18.
OPM issued a reconsideration decision denying the appellant’s application
on the basis that he “did not have more than 10 years of creditable civilian
service.” Id. at 5. OPM explained that because the appellant took a refund for
his first period of civilian service (August 1985 to January 1996) and because he
made no FERS deposits for his periods of active military service, his only
creditable FERS service was from June 2001 to February 2008, which totaled
6 years, 8 months, and 18 days of creditable service. Id. at 7. OPM stated that,
based on this creditable service, he would become eligible for a deferred annuity
at 62 years of age. Id.
The appellant then filed an appeal with the regional office challenging
OPM’s reconsideration decision. IAF, Tab 1. On his appeal form, the appellant
maintained that he satisfied the eligibility requirements for an MRA+10 annuity
and that his 1996 refund did not forfeit his later annuity eligibility. Id. at 2, 4.
During the proceedings below, OPM submitted the appellant’s 1996 FERS
Application for Refund of Retirement Deductions, Standard Form 3106
(SF-3106). IAF, Tab 7 at 26. The SF-3106 lists periods of civilian employment
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from August 1985 through January 1996, and contains a certification signed by
the appellant stating that he understood that receiving a refund “forfeit[ed] . . .
any retirement rights” for the period the refund covered. Id.
The administrative judge issued an initial decision, which agreed with
OPM’s finding that the “appellant’s aggregate creditable service under FERS[,]
totaling approximately six years, eight months, and 18 days, is not sufficient to
meet the 10 years of service requirement.” IAF, Tab 11, Initial Decision (ID)
10-11. The administrative judge therefore found that the appellant did not
establish that he was entitled to a deferred MRA+10 annuity, and he affirmed
OPM’s reconsideration decision. ID at 11.
The appellant has filed a timely petition for review. Petition for Review
(PFR) File, Tab 1. On review, he realleges that he only received a partial refund
of his retirement deductions in 1996. Id. at 4, 6, 8; IAF, Tab 10 at 3. He argues
that because he requested the refund at the end of his November 1994 to
January 1996 period of civilian employment, the refund covered only that time
period. PFR File, Tab 1 at 4, 6, 8. With his petition for review, the appellant
provides two Standard Form 50s (SF-50s) that are not in the record below. Id.
at 5, 7. The agency has submitted a pro forma response to the petition for review,
and the appellant has replied. PFR File, Tabs 5-6.
DISCUSSION OF ARGUMENTS ON REVIEW
OPM and the administrative judge correctly determined that the appellant
received a refund of his FERS contributions for the period from August 1985
through January 1996.
Both OPM’s reconsideration decision and the administrative judge’s initial
decision explained that the appellant’s 1996 refund of his FERS contributions
from August 5, 1985, through January 19, 1996, rendered that period of service
noncreditable toward the MRA+10 annuity benefit. ID at 6 -8; IAF, Tab 7 at 7.
On review, the appellant argues that he requested only a partial refund of his
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FERS contributions, covering the period from November 1994 to January 1996.
PFR File, Tab 1 at 4, 6, 8.
An appellant who files an appeal from an OPM reconsideration decision
involving retirement benefits has the burden of proving, by preponderant
evidence, that he is entitled to the benefits he seeks. Cheeseman v. Office of
Personnel Management, 791 F.2d 138, 140-41 (Fed. Cir. 1986); 5 C.F.R.
§ 1201.56(b)(2)(ii). Here, the appellant applied for an MRA+10 annuity. IAF,
Tab 7 at 18. The minimum retirement age for an individual born during 1964,
like the appellant, is 56 years old. Id. at 14; 5 U.S.C. §§ 8412(h)(1)(c), 8413(b)
(1).
The appellant was 58 years old when he applied for a deferred annuity in
2022. IAF, Tab 7 at 14, 17. Therefore, he met the age requirement for the
benefit he sought. However, he also needed 10 years of creditable service. Id.
at 5-7; see 5 U.S.C. § 8413(b)(1). The appellant paid FERS contributions while
employed from August 1985 to January 1996. IAF, Tab 7 at 39-44. He sought a
refund in January 1996, a few days after this service ended. Id. at 26. Assuming
he had no breaks in this service, it totaled approximately 10 years and 5 months.
Added together with his later service, the appellant exceeded the 10 -year
requirement.
However, the appellant received a refund of his FERS retirement
contributions in 1996. Id. A refund of an employee’s FERS contributions
generally voids all annuity rights for the period of service covered by the refund.
5 U.S.C. § 8424(a); Pagum v. Office of Personnel Management, 66 M.S.P.R. 599,
601 (1995). Although the appellant later had a second period of service from
June 2001 to February 2008, that service only totaled 6 years, 8 months, and 18
days. IAF, Tab 7 at 7, 15, 32.
We find no merit in the appellant’s assertion on review that the 1996
refund covered only the “period of federal service from November 1994 and
January 1996,” thereby bringing his total creditable service to 15 years and
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11 months. PFR File, Tab 1 at 4. In support of this claim, the appellant submits
two SF-50s for the first time on review. Id. at 5-7. The Board’s regulations
provide that it will grant a petition for review when, among other reasons, new
and material evidence is available that, despite the appellant’s due diligence, was
not available when the record closed. Ellis v. U.S. Postal Service, 121 M.S.P.R.
570, ¶ 6 (2014); 5 C.F.R. § 1201.115(d). Evidence is “new” when the
information contained in the documents, not just the documents themselves, were
unavailable despite the appellant’s due diligence when the record closed.
5 C.F.R. § 1201.115(d). Evidence is “material” when it is of sufficient weight to
warrant an outcome different from that of the initial decision. Ellis, 121 M.S.P.R.
570, ¶ 6; 5 C.F.R. § 1201.115(a)(1).
The SF-50s offered by the appellant on review are neither new nor
material. The two SF-50s are dated January 1996 and April 1994, respectively,
meaning that neither the documents themselves nor the information they contain
are novel. PFR File, Tab 1 at 5, 7. The appellant also did not attempt to show
due diligence by explaining why the SF-50s could not have been supplied earlier.
Even if these SF-50s could be considered new, they are not material. The January
1996 SF-50 states that, at the time of his separation, the appellant “was counseled
on entitlement to deferred annuity/refund of retirement deductions.” Id. at 7.
However, the appellant does not explain what this counseling contained or its
relevance to the refund he received later that year. As to the April 1994 SF-50,
the appellant argues that this SF-50 reflects that his employment between August
1985 and November 1994 was in a permanent position, as compared to his later
probationary service between November 1994 and January 1996. Id. at 4-6.
However, the appellant does not explain why these two periods are legally
distinct for purposes of receiving a refund. Neither the FERS statute nor OPM
regulations suggest that probationary versus permanent service are
distinguishable for purposes of FERS refunds. See 5 U.S.C. § 8424(a); 5 C.F.R.
5
§ 842.308(b)(2). Accordingly, neither SF-50 can be said to warrant an outcome
different from that ordered by the administrative judge.
The record evidence suggests that the 1996 refund covered the period from
August 1985 to January 1996. OPM submitted a calculation of the appellant’s
contributions and interest earned from the period of August 1985 to January 1996,
which totaled $2,602.78. IAF, Tab 7 at 28. That calculation matches the
payment amount that OPM stated on a March 6, 1996 notice to the appellant
advising him of the tax consequences of his refund election. Id. at 30. For the
same reason, the appellant’s Individual Retirement Record, which states that,
after withholding $180.00 for taxes, the appellant’s refund payment amount
would be $2,422.78, also contradicts the appellant’s assertion that he only
received a partial refund. Id. at 33.
Further, OPM’s policy for many years has been to pay all of an employee’s
retirement deductions, plus interest. Conway v. Office of Personnel Management,
59 M.S.P.R. 405, 409-11 (1993). Consistent with that policy, the SF-3106
required the appellant to list all of his Federal Service, and he did so. IAF, Tab 7
at 26; see Conway, 59 M.S.P.R. at 410-11 & n.2 (concluding that an appellant’s
belief that he would receive a refund for only the portion of service that he listed
on an SF-3106 was not reasonable). Because the appellant did not establish by
preponderant evidence that he received only a partial refund of his FERS
retirement deductions, we agree with the administrative judge’s determination
that the refund covered the period from August 1985 to January 1996. ID at
10-11.
The administrative judge observed that the appellant had identified
approximately 5 years of military service. ID at 2-3; IAF, Tab 7 at 14. However,
as the administrative judge observed, the appellant did not claim he made a FERS
deposit for this service. ID at 2; IAF, Tab 7 at 5, 14, 24, 26. The appellant did
not argue otherwise below or claim he made a military deposit on review.
Therefore, we will not disturb this conclusion.
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We remand this appeal for further consideration of whether the appellant is
entitled to credit for his refunded FERS covered service under 5 U.S.C.
§ 8424(a).
The administrative judge was not persuaded by the appellant’s argument
that, despite receiving a refund of his FERS contributions for his service between
August 1985 and January 1996, he retained FERS credit for this period for
purposes of determining his eligibility for a deferred annuity. IAF, Tab 1 at 4,
13; ID at 8-9. The appellant has not reraised this argument on review.
Nonetheless, we revisit this issue because the administrative judge’s finding was
central to his determination that the appellant was not eligible for an MRA+10
annuity.
On October 28, 2009, President Obama signed into law the National
Defense Authorization Act for Fiscal Year 2010, Pub. L. No. 111-84, 123 Stat.
2190 (NDAA). Among other FERS provisions, the NDAA amended 5 U.S.C.
§§ 8422 and 8424. Pub. L. No. 111-84, § 1904, 123 Stat. at 2616-17. As the
administrative judge observed, the NDAA amended 5 U.S.C. § 8422(i)(1) to
permit employees to regain service credit for refunded service by making a
deposit equaling the refund received plus interest for purposes of calculating their
annuities. Pub. L. No. 111-84, § 1904(a), 123 Stat. at 2616. Further, the NDAA
amended 5 U.S.C. § 8424(a) to provide that individuals who previously received
a FERS refund and were later reemployed in a position covered by FERS would
receive credit for their prior service for purposes of determining their eligibility
for an annuity. Pub. L. No. 111-84, § 1904(b)(4), 123 Stat. at 2617. The prior
version of § 8424(a) stated that “payment of a lump-sum credit . . . voids all
annuity rights . . . based on the service on which the lump-sum credit is based.”
5 U.S.C. § 8424(a) (2009). The current version, as updated by the NDAA, adds
that the voiding of annuity rights lasts only “until the employee . . . is reemployed
in the service subject to [FERS].” Pub. L. No. 111-84, § 1904(b)(4), 123 Stat.
at 2617 (codified at 5 U.S.C. § 8424(a)).
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To the extent that the administrative judge found that any entitlement that
the appellant might have to service credit for periods of refunded service arose
under 5 U.S.C. § 8422(i)(1), his reliance on this provision was misplaced.
Section 8422(i)(1) concerns the right to make a redeposit, which the appellant has
not claimed he attempted to do. Therefore, it is not applicable here. Rather,
5 U.S.C. § 8424(a) contains the relevant statutory language. As detailed above,
that provision now provides that certain individuals reemployed under FERS will
receive credit for refunded service without making a deposit.
The administrative judge found that NDAA § 1904, which enacted both
changes discussed above, only applies to individuals employed under FERS on or
after October 28, 2009. ID at 9. In reaching this conclusion, he deferred to
OPM’s guidance stating that “[t]he provisions of section 1904 of the NDAA only
apply to employees covered under FERS on or after October 28, 2009, and only
affect annuity benefits based on a separation from FERS coverage on or after
October 28, 2009.” OPM, Benefits Administration Letter, No. 11 -103, at 1
(Feb. 25, 2011), https://www.opm.gov/retirement-center/publications-forms/
benefits-administration-letters/2011/11-103.pdf (last visited Feb. 21, 2025); ID at
8-9. The same limitation on service credit for refunded service can be found in
OPM’s regulations. 5 C.F.R. § 843.202(b)(1). However, OPM does not explain
the basis for limiting the service credit to individuals who were separated from
Federal employment on or after October 28, 2009, either in its regulation or in its
Benefits Administration Letter. See Phased Retirement, 79 Fed. Reg. 46608-01,
46632 (Aug. 8, 2014) (setting forth the final rule that was codified as 5 C.F.R.
§ 843.202(b)); Phased Retirement, 78 Fed. Reg. 33912-01, 33919, 33933 (June 5,
2013) (setting forth the proposed rule that was codified as 5 C.F.R. § 843.202(b),
and explaining that the revision was made “to reflect the change in law affecting
the consequences of employee refunds”).
After the administrative judge issued the initial decision, the U.S. Supreme
Court issued its opinion in Loper Bright Enterprises v. Raimondo, 603 U.S. 369
8
(2024). In Loper Bright, the Supreme Court concluded that courts may not defer
to agency rules and regulations interpreting statutes. 603 U.S. at 412-13.
Instead, they must exercise “independent judgment.” Id. at 412. An
implementing agency’s legal interpretation of a statute concerning an area within
the agency’s expertise may be persuasive to a court based on a variety of factors,
including if it was issued contemporaneously with the statute and the agency has
consistently followed the same interpretation. Id. at 385-88, 394, 402 (citing
Skidmore v. Swift & Co., 323 U.S. 134, 137-40 (1944) (explaining that the weight
a court will give the interpretation of an official of the statute he is charged with
enforcing “will depend upon the thoroughness evident in its consideration, the
validity of its reasoning, its consistency with earlier and later pronouncements,
and all those factors which give it power to persuade, if lacking power to
control”)).
In addition to the question of the weight to give OPM’s temporal limit on
the NDAA’s amendment to 5 U.S.C. § 8424(a), statutory principles regarding
retroactivity are at play here. See Edwards v. Department of Labor, 2022 MSPB
9, ¶¶ 31-33 (applying the Supreme Court’s decision in Landgraf v. USI Film
Products, 511 U.S. 244, 280 (1994), to determine whether to give a statutory
amendment retroactive effect), aff’d, No. 22-1967 (Fed. Cir. July 7, 2023). Here,
5 U.S.C. § 8424(a) is silent as to whether it applies to events occurring before its
enactment. NDAA § 1904, which enacted the amendment to 5 U.S.C. § 8424(a),
is also silent. Section 1904 was one of five provisions in subtitle A of title XIX
of the NDAA. Three of those provisions provided that they were effective “on or
after the date of enactment” which, as mentioned above, was October 28, 2009.
Pub. L. No. 111-84, §§ 1901(c), 1902(b), 1903(b), 123 Stat. at 2615-16. In the
remaining provision, Congress specified the dates of qualifying service. Pub. L.
No. 111-84, § 1905(b), 123 Stat. at 2617-18. In sum, Congress’s silence as to the
scope of its amendment to 5 U.S.C. § 8424(a), its differing treatment of other
provisions in title XIX of subtitle A of the NDAA, and the Court’s decision in
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Loper Bright raise concerns regarding the weight the Board should accord to
OPM’s determination to exclude the appellant from the benefit of receiving
service credit for his refunded FERS service. Because the record is not developed
on this issue, we remand the case to the regional office for a determination. On
remand, the administrative judge should advise the parties of the standards
applicable to this matter under Landgraf and Loper Bright and provide the parties
with an opportunity to present relevant evidence and argument.
ORDER
For the reasons discussed above, we remand this case to the regional office
for further adjudication in accordance with this Remand Order. The
administrative judge may adopt his prior finding that the appellant received a
refund of his FERS contributions for the period from August 1985 to January
1996 in the remand initial decision.
FOR THE BOARD: ______________________________
Gina K. Grippando
Clerk of the Board
Washington, D.C.