Servicemembers are entitled to Social Security benefits, just like the vast majority of U.S. workers. We reported that Social Security covers about 96 percent of all U.S. employees and about three-fourths of federal, state, and local government employees pay Social Security taxes on their earnings. Social Security’s primary source of revenue is the Old Age, Survivors, and Disability Insurance portion of the payroll tax paid by employers and employees. That payroll tax amounts to 6.2 percent of earnings for both employers and employees, up to an established maximum. Regardless of whether the death occurred in the line of duty or not, survivors of deceased servicemembers, covered civilian government employees, or their estates are eligible for a lump sum payment of $255. Moreover, eligible survivors are also entitled to recurring Social Security benefit payments. Eligibility for the $255 and recurring payments is determined by whether a deceased employee was currently insured through Social Security. The amount of recurring payment is based on the deceased employee’s earnings in covered employment. Deceased servicemembers’ survivors are entitled to a wide range of benefits. In our September 2002 report, we noted that a survivor might be entitled to a death gratuity payment, a life insurance settlement, burial benefits, monthly payments, and various other benefits that include the use of commissaries and exchanges. Determining whether the deceased servicemember died in the line of duty is seldom a consideration when awarding survivor benefits because an active duty servicemember is considered to be on duty 24 hours a day and 7 days a week. Determination of eligibility for some benefits provided to the survivors of deceased federal and, in most cases, state and local civilian government employees is based on a more restrictive definition of line of duty. For example, survivor benefits provided through workers’ compensation require that the civilian government employee die in the line of duty. The definition of line of duty for federal civilian employees includes any action that an employee is obligated or authorized to perform by rule, regulations, law, or condition of employment according to the employee’s agency. The effect of an eligibility determination based on line of duty can be illustrated using the example of an employee who has a heart attack while eating lunch at a restaurant. The servicemember is probably covered, whereas the civilian government employee is typically not covered. Survivor benefits for some civilian government employees are also contingent on the employee’s occupation, in addition to the circumstance of whether the employee’s death occurred in the line of duty. Law enforcement officers, firefighters, and employees in some other occupations at federal, state, and city levels may receive a supplemental survivor benefit provided through the Public Safety Officers’ Benefits Act, administered by the Department of Justice’s Bureau of Justice Assistance. State and city governments may provide other supplemental benefits to the survivors of deceased employees who work in high-risk occupations. The military and civilian government entities offer similar types of cash and noncash survivor benefits, but the entities provide different amounts for the survivor benefits. In general, the military and civilian government entities provide cash benefits—either as a lump sum, recurring payments, or both—and noncash benefits, such as continued health insurance or education benefits. Survivors of servicemembers almost always receive higher lump sum payments. For three of the four hypothetical situations, the recurring payments for deceased servicemembers’ survivors exceed the recurring payments that at least one-half of the states provide. In contrast, the recurring payments for deceased servicemembers’ survivors in the same three situations are lower than those that at least one-half of the cities provide. The military provides more types of noncash benefits to survivors of deceased servicemembers than do civilian government entities provide to the survivors of deceased general government employees. Survivors of deceased servicemembers and most deceased general government employees receive lump sum payments through comparable sources—Social Security, a death gratuity, burial expenses, and life insurance; the federal government, 16 states, and the District of Columbia provide additional lump sum payments through their respective retirement plans (see table 1 for a summary and appendix II for descriptions of how the payments are calculated for each entity). Social Security provides $255 upon the death of a deceased servicemember or covered civilian government employee. The death gratuity provided to survivors is $12,000 (tax-exempt) for deceased servicemembers, up to $10,000 for deceased federal government employees, and between $25,000 and $262,405 for deceased employees of the 5 states and 1 city that provide this benefit. The military’s death gratuity ranks above that paid by 55 of the 61 civilian government entities. The payment for burial expenses provided to survivors is up to $6,900 (tax-exempt) for deceased servicemembers, up to $800 (tax-exempt) for deceased federal government employees, and between $2,000 and $15,000 for deceased employees of all states and cities. The military’s payment for burial expenses ranks above that paid by 49 of the 61 civilian government entities. Life insurance is another common source of benefits for the survivors of many deceased servicemembers and civilian government employees. For example, approximately 98 percent of servicemembers and 91 percent of federal employees participate in government-sponsored life insurance. Servicemembers automatically are insured for $250,000 (tax-exempt) unless they elect less or no coverage. Although the government does not contribute to the Servicemembers’ Group Life Insurance, we elected to include the information in this report because the program plays a large role in the benefits provided to survivors and nearly all servicemembers participate in the program. Fifty-one of the 61 civilian government entities pay a portion of the life insurance premiums for their employees and reported that they provide this benefit to at least 80 percent of their employees. A federal employee is automatically enrolled for a payout (tax-exempt) equal to the employee’s rate of basic pay, rounded to the next higher $1,000, plus $2,000. The federal government contributes one-third of the total cost (i.e., 15 cents per month for each $1,000) of the basic coverage premium. For example, the government’s contribution for a federal employee who has $37,000 of basic life insurance coverage is $5.55 per month. The amount of coverage state and city governments provide varies and is determined as either a flat amount or a percentage of the employee’s salary. The military and the 9 cities do not provide a lump sum survivor benefit as part of their retirement plans. In contrast, the federal government, 16 states and the District of Columbia include a survivor benefit in their retirement plans. Similar to the funding of life insurance, these 18 civilian government entities contribute a portion of the benefit. These payments are generally based on the deceased employee’s annual salary, employer contributions to the retirement plan, or a flat amount. Although survivors of deceased military and civilian government employees are eligible for recurring Social Security payments, other types of recurring payments are specific to either servicemembers or civilian government employees (see table 2 for a summary and appendix II for descriptions of how the recurring payments are computed for each entity). As previously mentioned, the survivors of deceased servicemembers and survivors of three-fourths of the civilian government employees may be eligible to receive recurring Social Security payments based on the deceased employees’ earnings in covered employment. This recurring payment to the survivor will be equal if the deceased servicemember’s and deceased civilian government employee’s earnings in covered employment are identical. Survivors of deceased servicemembers would also receive payments through the Survivor Benefit Plan (SBP), tax-exempt Dependency and Indemnity Compensation (DIC), or both. The SBP payment is calculated based on 55 percent of the member’s maximum monthly retirement pay, and DIC provides $967 per month for a spouse, plus $241 per month for each child. If the spouse is the designated beneficiary for SBP, the SBP payment is reduced by the DIC payment. Additionally, if the DIC payment is greater than the SBP payment, there is no SBP payment. However, under the most recent changes to SBP, SBP benefits can be paid to the children, and the DIC payment can be paid to the spouse without causing any reduction in the SBP payment, thus providing a substantial increase in monthly payments during the years when children are still at home or in school. Similar to the military, survivors of deceased civilian government employees may receive recurring payments from multiple sources: a retirement plan, workers’ compensation if the death occurred while in the line of duty, or both. Survivors of deceased federal government employees receive the higher of two options: (1) 50 percent of an employee’s monthly retirement pay, if the employee had at least 10 years of creditable service, plus a lump sum payment or (2) up to 75 percent of the employee’s pay rate under the Federal Employees Compensation Act. The rules for determining the recurring payments for survivors of deceased state and city employees vary widely but are summarized in table 2. For the four hypothetical situations, the lump sum payments—excluding Social Security—for survivors of deceased servicemembers are almost always higher than those for the survivors of deceased civilian government employees in general. For hypothetical situations 2, 3, and 4, the recurring payments for deceased servicemembers’ survivors exceed the recurring payments that at least one-half of the states provide. In contrast, the recurring payments for deceased servicemembers’ survivors are lower than those that at least one-half of the cities provide (see table 3 for a summary and appendix III for the specific amounts provided by each entity for each type of payment). Hypothetical situation 2 is used as an example to explain the findings shown in table 3. It describes the situation of a servicemember or civilian government employee who had accrued 3 years of creditable service, an income of $34,376 (what an E-3 might be paid in the military), and two dependents. The benefits—excluding Social Security—provided to such a person’s survivors are outlined below. Servicemember’s survivors: The survivors would receive $268,900 in a lump sum payment from a death gratuity, life insurance, and burial expenses, as well as $2,390 in recurring payments from DIC and SBP (assuming the child is the designated beneficiary). Federal government employee’s survivors: The survivors would receive $121,000 in a lump sum payment from a death gratuity, which includes burial costs, and life insurance and $1,718 in recurring payments from workers’ compensation. That is, the survivors would receive nearly $148,000 less in a lump sum payment and almost $700 less per month in recurring payments than would a servicemember’s survivors. State or city government employee’s survivors: Interpretation of the state and city amounts is more problematic because the lump sum and recurring payments shown in the same row of table 3 may represent amounts paid by a different state or city government. For hypothetical situation 2, the median—or average—lump sum payment was $55,000 for states and $40,000 for cities. The lump sum payments range from $3,500 to $311,005 for the 50 states and the District of Columbia, while the recurring payments range from $1,146 to $5,059. The lump sum payments range from $5,000 to $110,000 for the 9 cities, while the recurring payments range from $2,149 to $5,014. In most instances, it would take years of inflation-adjusted recurring payments for the survivors of those general state and city government employees to reach the total lump sum and recurring payment benefits provided to the survivors of the servicemembers. Also some states or cities limit the duration (e.g., workers’ compensation benefits in Indiana and Maine are limited to 500 weeks) or total value (e.g., workers’ compensation benefits in Maryland are limited to $45,000) for some types of their recurring payments. These limits further lessen the likelihood that some survivors of deceased state and city government employees will receive lifetime benefits at least equal to those provided to deceased servicemembers’ survivors. The military provides more noncash survivor benefits than do the federal, state, and city governments, with some benefits being comparable in type and others differing among the entities (see table 4 for examples of the most common benefits). For example, the military, federal government, 17 states, and 7 cities provide continued health insurance that is wholly or partially subsidized. Additionally, the military and 5 of the state governments provide some education benefits. Eligible survivors of servicemembers who die while on active duty also obtain benefits such as rent-free government housing or a tax-free housing allowance for up to 180 days, relocation assistance, and lifetime access to commissaries and exchanges that are not available to other government survivors. The survivors of civilian government employees in selected high-risk occupations may receive supplemental benefits beyond those that the entities provide to government employees in general (see table 5 for a summary and appendix IV for the descriptions of how the payments are calculated for each entity). Employees in selected high-risk occupations in the 61 civilian government entities may receive an additional cash benefit through the Public Safety Officers’ Benefits (PSOB) Program. Using a case-by-case determination process, the Department of Justice’s Bureau of Justice Assistance provides a lump sum payment of $267,494 (for fiscal year 2004) to the eligible survivors of public safety officers whose deaths are the direct and proximate result of traumatic injury sustained in the line of duty. According to agency officials, the Bureau of Justice Assistance approved 659 death claims in fiscal year 2002 with 417 cases related to World Trade Center deaths, and 194 death claims for fiscal year 2003. Thirty-four states and 5 cities also supplement cash benefits for employees in high-risk occupations. For example, some states, such as Texas, Florida, and Arkansas, provide an additional death gratuity to survivors of government employees in high-risk occupations. Other states, such as Iowa, New Mexico, and Nevada, provide insurance benefits that are higher than those provided to general government employees. Still other states, such as Alaska, New Jersey, and Montana, provide survivor benefits through their retirement plans that are higher than those provided to general government employees. When these supplemental cash benefits are added to the benefits for general government employees, the total cash benefits that the entities provide to the survivors of deceased civilian government employees in high-risk occupations may be higher than those provided to deceased servicemembers’ survivors. For example, the very limited number of survivors who receive the $267,494 from the PSOB Program would likely have total survivor benefits higher than those provided to servicemembers’ survivors. In addition to the supplemental cash benefits, some of the states and cities provide supplemental noncash benefits for survivors of deceased employees in high-risk occupations. Eleven states provide survivors of employees in high-risk occupations with education benefits that are not provided to survivors of general government employees. Additionally, two states and two cities provide continued health insurance to survivors of employees in high-risk occupations that are not provided to survivors of general government employees. DOD reviewed a draft of this report and provided technical comments, which were incorporated as appropriate. We are sending copies of this report to the Secretary of Defense. In addition, the report will be available at no charge on GAO’s Web site at http://www.gao.gov. If you or your staff have any questions regarding this report, please contact me at (202) 512-5559 (stewartd@gao.gov) or Jack E. Edwards at (202) 512- 8246 (edwardsj@gao.gov). Other staff members who made key contributions to this report are listed in appendix V. To assess the extent that survivor benefits provided to servicemembers’ survivors differ from those provided to federal, state, and city general government employees’ survivors, we gathered benefits information that covered the active duty military and the largest group of employees for each of 61 civilian government entities: the federal government, 50 states and the District of Columbia, and the 9 cities with a population of at least 1 million. While limiting the scope of our work to the 9 cities with at least 1 million people restricted the generalizability of our city findings to only those 9 cities, it allowed us to discuss with certainty (i.e., without sampling error) findings for the largest cities in the United States. Except for the Servicemembers’ Group Life Insurance, all benefits addressed in this report included government contributions. We elected to include military life insurance in this report because the program plays a large role in the benefits provided to survivors; nearly all servicemembers participate in the program; and during times of war, there may be government contributions. Life insurance information was included for a civilian government entity only if at least 80 percent of the employees received the benefit. We gathered data from the military and the federal agencies shown in table 6 through personal interviews. We developed a structured telephone interview to collect data, including general descriptions of the benefits and the way the benefits are determined, from state and city agencies. The initial content for developing the interview questions came from reports issued by us and other agencies as well as from consultations with benefits personnel and staff with expertise on specific military or civilian personnel government survivor benefit programs, such as Social Security. We pretested the structured telephone interview to minimize the occurrence of nonsampling errors, which led to modification of the data gathering instrument to clarify questions and address the ordering of items and other concerns that could affect data reliability. To further ensure data reliability, we requested and reviewed survivor benefits information, including statutes and plan documents, from each entity. For some civilian government entities, especially at the state and city levels, interviews were conducted with multiple offices because the responsibility for administering the different types of survivor benefits resided in different offices. All 62 entities provided information, but 1 state elected not to provide information on its retirement benefit. Similarly, we developed and obtained feedback on an e-mail-administered survey that described four hypothetical situations and assessed cash benefits. The hypothetical situations were developed to correspond to personnel at various stages of a military or government career, describing the servicemember’s or civilian government employee’s years of service, income, and number of dependents. The survey was sent to the military and all general civilian government entities to obtain information on the payments that would be provided in each hypothetical situation. When our interpretations of the benefits differed from the information supplied by the military or civilian government entities, we contacted the entities and resolved the differences. The responses to the survey reflect current values and do not account for lifetime payments, which may include cost-of-living adjustments and other assumptions. All 62 entities provided information, but 1 state elected not to provide information on its retirement benefit. To assess the extent that federal, state, and city governments supplement their general survivor benefits for employees in high-risk occupations, we gathered benefits information, except for the hypothetical situations, that covered law enforcement officers and firefighters in the same manner as for government employees in general. We selected law enforcement officers and firefighters because we considered those two occupations to have higher levels of personal risk than those found for government employees in general. As with the government employees in general, we limited the scope to include the 61 civilian government entities. All 61 entities provided information, but 1 state and 1 city elected not to provide requested information regarding a benefit for high-risk employees, retirement and life insurance, respectively. For both civilian government employees in general and civilian government employees in high-risk occupations, the concept of line of duty was an important consideration in the scope of this work because the granting of some survivor benefits is contingent on whether the employee dies in the line of duty. While active duty servicemembers are considered to be on duty 24 hours a day and 7 days a week, the definition for line of duty for civilian federal employees is more restrictive. The federal government defines line of duty as any action that an employee is obligated or authorized by rule, regulations, law, or condition of employment to perform by the agency served. Similar definitions were present for the administration of survivor benefits in some states and cities. Although the civilian government entities typically provide benefits to survivors of those who die while not in the line of duty, those benefits are not separately identified from the line-of-duty benefits in this report. We conducted our review from October 2003 through May 2004 in accordance with generally accepted government auditing standards. This appendix describes the cash benefits available to eligible survivors of active duty servicemembers and civilian government employees who die in the line of duty. We obtained information on the survivor benefits for the active duty military and the largest general employee group in each of 61 civilian government entities: the federal government, 50 states and the District of Columbia, and the 9 U.S. cities with a population of at least 1 million. Types of cash benefits are listed along with descriptions of how lump sum payments, recurring payments, or both are computed for each entity. We obtained the information through structured interviews with benefits personnel for the 62 entities and verified the reliability of that data through a review of statutes, benefits plans, and other information that the benefits personnel supplied. The information presented in this appendix is summarized in tables 1 and 2 in the report. This appendix identifies the amount of cash benefits available to eligible survivors of active duty servicemembers and civilian government employees who die in the line of duty. To facilitate the comparison of cash benefits available to survivors, we constructed four hypothetical situations that each described servicemembers or civilian government employees who had identical years of creditable service, an equal amount of regular military compensation or civilian government salary, and the same number of dependents at the time of their deaths. The four hypothetical situations for military and civilian government personnel are indicative of circumstances for servicemembers at a junior enlisted level (E-3) with and without dependents, at a senior enlisted level (E-7), and at a mid-grade officer level (O-3). We gathered data from benefits personnel who completed an e-mail survey that described the four hypothetical situations and asked for the amount of cash payments (in current-month values, without cost-of-living adjustments) that survivors would receive from each source of lump sum or recurring payments. (The methods for computing the amounts were described earlier in appendix II.) We obtained such information on the survivor benefits plans for the active duty military and the largest general employee group in each of 61 civilian government entities: the federal government, 50 states and the District of Columbia, and the 9 U.S. cities with a population of at least 1 million. Types of cash benefits are listed along with lump sum payments, recurring payments, or both, for each entity. The information in this appendix is summarized in table 3 in the report. To facilitate the comparison of military findings to those for the civilian government entities, we rank ordered the total lump sum and total recurring payments for each of the 62 entities on each hypothetical situation. The ranks appear in parentheses, with “1” indicating the highest lump sum or recurring payment for the situation and “62” indicating the lowest amount. This appendix describes the cash benefits available to eligible survivors of civilian government employees who die in the line of duty while performing in the high-risk occupations of law enforcement or firefighting. We obtained information on the survivor benefits plans for these occupations from the federal government, 50 states and the District of Columbia, and the 9 U.S. cities with a population of at least 1 million. Types of cash benefits are listed along with descriptions of how the lump sum payments, recurring payments, or both are computed for each entity if these benefits are above those provided to the survivors of general government employees. We obtained the information through structured interviews with benefits personnel for the 61 civilian government entities and verified the reliability of that data through a review of statutes, benefits plans, and other information that the benefits personnel supplied. The information presented in this appendix is summarized in table 5 in the report. In addition to the individual named above, Mark B. Dowling, Joel I. Grossman, Barbara L. Joyce, Marie A. Mak, Hilary L. Murrish, Cheryl A. Weissman, and Greg H. Wilmoth made key contributions to this report. 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Summary: The National Defense Authorization Act for Fiscal Year 2004 noted that it was the sense of the Congress that "the sacrifices made by the members of the Armed Forces are significant and are worthy of meaningful expressions of gratitude by the United States, especially in cases of sacrifice through loss of life." In addition to offering expressions of gratitude, the government offers a variety of benefits, including Social Security benefits, to survivors of servicemembers who die while on active duty. GAO was asked to address two questions: (1) To what extent are the survivor benefits provided to servicemembers different from those provided to federal, state, and city government employees in general and (2) To what extent do federal, state, and city governments supplement their general survivor benefits for employees in high-risk occupations? The military provides survivor benefits that are comparable in type but not in amount to those provided by 61 civilian government entities (federal government, 50 states and the District of Columbia, and 9 cities with populations of at least 1 million) when employees die in the line of duty. Social Security payments, a death gratuity, burial expenses, and life insurance are four types of lump sum survivor benefits provided by the military and at least some civilian government entities; the federal government and some states additionally provide a lump sum payment through their retirement plans. Recurring payments are also provided by Social Security to the survivors for deceased servicemembers and most deceased government employees in the 61 civilian government entities GAO studied. Other types of recurring payments are specific to the military or civilian government entities. GAO identified two programs with recurring payments for the military and two other types of programs for the civilian government entities. For the four hypothetical situations GAO used to examine the amount of cash payments provided to survivors, survivors of deceased servicemembers almost always obtain higher lump sums than do the survivors of the deceased employees from the 61 civilian government entities. The amount of recurring payments to deceased servicemembers' survivors in three of the four situations exceeds those provided by the federal government, typically exceeds those provided by at least one-half of the states, but are typically less than those provided by over one-half the cities. The military also provides more types of noncash survivor benefits than do civilian government entities, with some benefits being comparable in type and others differing among the entities. The survivors of civilian government employees in some high-risk occupations may receive supplemental benefits--a death gratuity, higher life insurance, higher benefits from the retirement plan, or a combination of the three--beyond those that the entities provide to civilian government employees in general. For example, survivors of federal, state, and city government law enforcement officers and firefighters who die in the line of duty may be entitled to a lump sum payment of more than $267,000 under the Public Safety Officers' Benefits Act. Further, 34 states and 5 cities provide survivors of employees in high-risk occupations with additional cash benefits that are not available to survivors of state and city employees in general. The addition of these supplemental cash benefits to those provided to the survivors of deceased general government employees can result in lump sum and recurring payments being generally higher for survivors of government employees in high-risk occupations than for servicemembers' survivors.