FY06 VOLUNTARY SEPARATION PAY (VSP) PROGRAM IMPLEMENTATION

RAAUZYUW RUENAAA0314 1631034-UUUU--RUCRNAD.
ZNR UUUUU ZUI RUEWMCF8399 1631122
R 121034Z JUN 06 ZYB MIN ZYW PSN 934806K30
FM CNO WASHINGTON DC//N1//
TO NAVADMIN
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UNCLAS //N05711//
NAVADMIN 169/06
MSGID/GENADMIN/CNO WASHINGTON DC/N1/JUN//
SUBJ/FY06 VOLUNTARY SEPARATION PAY (VSP) PROGRAM IMPLEMENTATION//


REF/A/DOC/P.L. 109-163, SEC. 643/06JAN2006//
REF/B/DOC/PDUSD(PR) MEMO/26MAY2006//
REF/C/DOC/ASN(MRA) MEMO/02JUN2006//
NARR/REF A IS SECTION 643 OF THE FISCAL YEAR 2006 NATIONAL DEFENSE
AUTHORIZATION ACT (FY06 NDAA).  REF B IS THE DOD POLICY MEMORANDUM
IMPLEMENTING VSP.  REF C IS ASN (M&RA) MEMORANDUM DIRECTING
IMPLEMENTATION OF A NAVY VSP PROGRAM.//
GENTEXT/REMARKS/1.  THIS NAVADMIN ANNOUNCES THE ESTABLISHMENT OF A
VOLUNTARY SEPARATION PAY (VSP) PROGRAM FOR THE NAVY.  AN INTEGRAL
PART OF NAVY'S FORCE SHAPING EXECUTION STRATEGY, VSP IS A FINANCIAL
INCENTIVE TOOL DESIGNED FOR OFFICERS WITH AT LEAST SIX AND NOT MORE
THAN 12 YEARS OF ACTIVE SERVICE IN CERTAIN OVERMANNED
COMMUNITIES/SKILLS TO VOLUNTARILY SEPARATE FROM ACTIVE DUTY.
2.  THE OBJECTIVE OF THE VSP PROGRAM, ALONG WITH OTHER FORCE SHAPING
INITIATIVES, IS TO HELP THE NAVY MEET END STRENGTH REQUIREMENTS AND
ASSIST IN CORRECTING INVENTORY IMBALANCES IN PAY GRADE AND LENGTH OF
SERVICE/SKILL MIX.  OFFICERS WHO VOLUNTEER TO PARTICIPATE IN THE
PROGRAM AND ACCEPT A VSP PAYMENT UPON SEPARATION MUST SEPARATE NO
LATER THAN 30 SEP 06.  SINCE VSP WILL BE USED TO MEET SPECIFIC
PERSONNEL FORCE SHAPING OBJECTIVES, IT IS NOT EXPECTED TO BE OFFERED
EVERY FISCAL YEAR.  PER REFS A THROUGH C, AUTHORITY TO CARRY OUT A
VSP PROGRAM EXPIRES 21 DEC 2008.
3.  PROGRAM OVERVIEW.  THE VSP PROGRAM WILL EMPLOY A MARKET BASED
AUCTION STYLE APPROACH, ALLOWING OFFICERS TO SET THE "PRICE" FOR
SEPARATING FROM ACTIVE DUTY.  THIS MEANS THAT NAVY CAN MEET OFFICER
EXPECTATIONS OF A FAIR, OBJECTIVE INCENTIVE TO SHAPE THE FORCE.
INITIALLY, VSP WILL ONLY BE OPEN TO OFFICERS.  OFFICERS IDENTIFIED
AS ELIGIBLE FOR THE PROGRAM WILL BE OFFERED THE OPPORTUNITY TO
PARTICIPATE IN THE AUCTION AND WILL BE ADVISED OF THE MAXIMUM BID
AMOUNT PER COMMUNITY WITHIN STATUTORY LIMITS ESTABLISHED IN REF A.
THE ACTUAL NUMBER OF OFFICERS APPROVED FOR SEPARATION WITH VSP (THE
TARGET POPULATION) WILL BE SOME NUMBER LESS THAN THE IDENTIFIED
ELIGIBLE PARTICIPANTS IN ORDER TO ALLOW FOR "COMPETITION AMONGST
BIDDERS IN THE MARKET PLACE".  VSP APPROVALS WILL BE BASED ON
WHETHER PARTICIPANTS MEET ELIGIBILITY CRITERIA, AND WHETHER THEIR
BIDS ARE WITHIN THE COMMUNITY-SPECIFIC TARGET POPULATION (SEE PARA 7
BELOW FOR DETAILS REGARDING THE VSP AUCTION METHODOLOGY).  NAVY WILL
ESTABLISH MAXIMUM BID AMOUNTS WITHIN THE STATUTORY LIMITS
ESTABLISHED BY REF A BY COMMUNITY.
4.  VSP IS A SEPARATION PAY AND, AS SUCH, CANNOT BE CONTRIBUTED TO
THE THRIFT SAVINGS PLAN (TSP).
5.  ELIGIBILITY.  TO BE ELIGIBLE TO PARTICIPATE IN THE VSP PROGRAM
AN OFFICER MUST MEET ALL OF THE GENERAL ELIGIBILITY CRITERIA LISTED
BELOW.  ADDITIONALLY, THE OFFICER MUST MEET SPECIFIC CRITERIA
ESTABLISHED FOR HIS/HER COMMUNITY.  GENERAL ELIGIBILITY CRITERIA ARE
BASED ON STATUTORY REQUIREMENTS OF REF A AND OVERARCHING NAVY
IMPLEMENTATION POLICIES NECESSARY TO MEET THE OBJECTIVES OF THE VSP
PROGRAM.  COMMUNITY-SPECIFIC ELIGIBILITY IS ALSO BASED ON VSP
PROGRAM OBJECTIVES, AND IN GENERAL, REPRESENTS AN OBJECTIVE SET OF
CRITERIA THAT CAN BE USED TO IDENTIFY OFFICERS WHOSE LONG-TERM
CAREER POTENTIAL IS NOT DEEMED TO BE AS COMPETITIVE AS THAT OF THEIR
PEERS.  EXAMPLES, WHICH ARE NOT ALL-INCLUSIVE, OF COMMUNITY-SPECIFIC
CRITERIA ARE:  A FIRST-TIME FAILURE OF SELECTION FOR PROMOTION TO
THE NEXT HIGHER GRADE; FAILURE TO ACHIEVE A CAREER MILESTONE SUCH AS
SCREENING FOR DEPARTMENT HEAD AFLOAT; OR AN AVIATION OFFICER SERVING
IN A NON-FLYING DESIGNATOR.
    A.  GENERAL ELIGIBILITY CRITERIA.  OFFICERS MUST MEET ALL OF THE
FOLLOWING GENERAL CRITERIA TO BE ELIGIBLE FOR PARTICIPATION IN THE
FY06 VSP PROGRAM:
        (1) MUST BE AN OFFICER WHO HAS COMPLETED MORE THAN SIX, BUT
NOT MORE THAN 12 YEARS OF ACTIVE DUTY SERVICE PRIOR TO THE DATE OF
SEPARATION;
        (2) SERVED AT LEAST 5 YEARS OF CONTINUOUS ACTIVE DUTY
IMMEDIATELY PRECEDING THE DATE OF THE MEMBER'S SEPARATION FROM
ACTIVE DUTY;
        (3) SERVING ON THE ACTIVE DUTY LIST (ADL) IN A GRADE ABOVE
WARRANT OFFICER; AND
        (4) SERVING IN AN OFFICER COMMUNITY (DESIGNATOR) THAT HAS
BEEN TARGETED FOR VSP IN NAVY'S FORCE SHAPING EXECUTION STRATEGY
PLAN.  FOR FY06 TARGETED DESIGNATORS INCLUDE:  111X, 112X, 130X,
131X, 132X, 120X, 152X, 161X, 163X, 180X, 310X, 410X, AND 510X.
    B.  COMMUNITY SPECIFIC ELIGIBILITY CRITERIA.  ELIGIBILITY
CRITERIA SPECIFIC TO EACH OF THE OFFICER COMMUNITIES/DESIGNATORS
LISTED ABOVE CAN BE FOUND AT THE NPC WEBSITE
HTTP:/WWW.NPC.NAVY.MIL/CHANNELS OR BY CONTACTING THE APPROPRIATE
COMMUNITY MANAGER.  COMMUNITY MANAGER CONTACT INFORMATION CAN BE
FOUND AT THE NPC WEBSITE OR BY LOOKING IN THE MOST RECENT ISSUE OF
LINK-PERSPECTIVE MAGAZINE.
    C.  ELIGIBILITY OF CERTAIN RESERVE COMPONENT OFFICERS ON THE
ADL.  CERTAIN OFFICERS ON THE ADL WHO HAVE NOT BEEN AUGMENTED INTO
THE REGULAR COMPONENT MAY BE ELIGIBLE TO PARTICIPATE IN THE VSP
PROGRAM IF THEY MEET THE GENERAL ELIGIBILITY CRITERIA LISTED IN PARA
4A ABOVE.  IF INCLUDED IN THIS CATEGORY, AN OFFICER WILL BE
SPECIFICALLY NOTIFIED BY NPC.  WHILE PARTICIPATION IN THE VSP
PROGRAM IS VOLUNTARY, OFFICERS IN THIS CATEGORY ARE ADVISED THAT IF
THEY CHOOSE NOT TO PARTICIPATE, THEY MAY BE LIABLE FOR INVOLUNTARY
SEPARATION UNDER TITLE 10, UNITED STATES CODE (USC), SECTION 12313.
6.  INELIGIBILITY.  THE FOLLOWING OFFICERS ARE NOT ELIGIBLE TO
PARTICIPATE IN THE VSP PROGRAM:
    A.  AN OFFICER WHO IS BEING PROCESSED FOR DISCHARGE, OR HAS BEEN
DISCHARGED, WITH DISABILITY SEVERANCE PAY UNDER SECTION 1212 OF
TITLE 10, USC.
    B.  AN OFFICER WHO IS BEING PROCESSED FOR TRANSFER, OR HAS BEEN
TRANSFERRED, TO THE TEMPORARY DISABILITY RETIRED LIST UNDER SECTION
1202 OR 1205 OF TITLE 10, USC.
    C.  AN OFFICER WHO IS BEING EVALUATED FOR DISABILITY RETIREMENT
UNDER CHAPTER 61 OF TITLE 10, USC.
    D.  AN OFFICER WHO IS SUBJECT TO PENDING DISCIPLINARY ACTION OR
WHO IS SUBJECT TO ADMINISTRATIVE SEPARATION OR MANDATORY DISCHARGE
UNDER ANY OTHER PROVISION OF LAW OR REGULATION.
    E.  AN OFFICER SERVING ON THE RESERVE ACTIVE STATUS LIST (RASL)
AS A FULL TIME SUPPORT (FTS) OFFICER (DESIGNATOR XXX7).
7.  NOTIFICATION AND PARTICIPATION PROCEDURES.
    A.  PERS-48 WILL CONTACT THE COMMANDING OFFICER (CO) OF OFFICERS
ELIGIBLE FOR PARTICIPATION IN THE VSP PROGRAM BY EMAIL.  THE EMAIL
WILL CONTAIN TWO LETTERS.  ONE IS A LETTER OF NOTIFICATION OF
ELIGIBILITY.  THE OTHER IS A TEMPLATE FOR THE OFFICER TO FILL OUT
WITH HIS/HER ELECTION AND ELECTRONICALLY RETURN TO PERS-48 VIA THEIR
CO.  NOTIFICATION MESSAGES WILL BE SENT TO INDIVIDUALS IN A
COMMUNITY'S ELIGIBLE POOL OF OFFICERS, AND WILL ESTABLISH THE
MAXIMUM BID (I.E., MAXIMUM AMOUNT OF VSP BEING OFFERED), AS WELL AS
THE NUMBER OF PERSONNEL WHO WILL BE OFFERED THE PAYMENT FOR EACH
SPECIFIC COMMUNITY.
    B.  THE CO'S ARE REQUIRED TO IMMEDIATELY NOTIFY ELIGIBLE MEMBERS
WITHIN THEIR COMMANDS AND SEND AN ELECTRONIC ACKNOWLEDGEMENT OF
ELIGIBLE MEMBER NOTIFICATION TO PERS-48.  CO'S MAY, AS THEY DEEM
APPROPRIATE, PROVIDE A FAVORABLE OR NEGATIVE ENDORSEMENT WRT
OFFICERS WHO CHOOSE TO PARTICIPATE IN THE VSP PROGRAM.  A
NEGATIVE ENDORSEMENT IS NOT A GUARANTEE TO REMOVE THE OFFICER FROM
ELIGIBILITY, OR CONSIDERATION FOR APPROVAL OF A VSP SEPARATION.  THE
CO'S ENDORSEMENT WILL BE GIVEN ALL DUE CONSIDERATION AS PART OF THE
DECISION-MAKING PROCESS.  ULTIMATELY, APPROVALS OR DISAPPROVALS FOR
VSP WILL BE BASED UPON THE BEST INTERESTS OF THE NAVY.
    C.  ELIGIBLE OFFICERS WILL HAVE 14 DAYS FROM RECEIPT OF CO'S
NOTIFICATION TO SUBMIT A POSITIVE OR NEGATIVE VSP RESPONSE/ELECTION.
OFFICERS WHO ELECT TO PARTICIPATE IN THE PROGRAM (I.E., SUBMIT A
POSITIVE ELECTION) AND BE CONSIDERED FOR VSP, MUST SUBMIT A
COMPETITIVE BID WITH THEIR REPLY.  FAILURE TO SUBMIT A BID WILL
AUTOMATICALLY RESULT IN A DISAPPROVAL OF THE OFFICER'S ELECTION TO
PARTICIPATE IN THE PROGRAM.
8.  SELECTION AND VSP AUCTION METHODOLOGY.  COMMUNITY MANAGERS WILL
REVIEW ALL POSITIVE VSP ELECTIONS TO ENSURE OFFICERS MEET
ESTABLISHED ELIGIBILITY CRITERIA.  THESE POSITIVE ELECTIONS WILL
THEN BE RANKED FROM LOWEST TO HIGHEST COMPETITIVE BID UNTIL THE
TARGET POPULATION FOR THE COMMUNITY IS REACHED.  THIS TARGET
POPULATION WILL CONSTITUTE THE "SUCCESSFUL BIDDERS."  USING WHAT IS
KNOWN AS A "UNIFORM PAYMENT AUCTION METHODOLOGY", ALL SUCCESSFUL
BIDDERS OF EACH COMMUNITY WILL RECEIVE THE SAME VSP PAYMENT AS
DETERMINED BY THE HIGHEST ACCEPTED BID.  FOR EXAMPLE, IF 300 PEOPLE
ARE SENT NOTIFICATION MESSAGES (ESTABLISHING THAT 100 PERSONNEL WILL
BE OFFERED A SEPARATION PAYMENT) AND IF 275 PEOPLE ELECT TO
PARTICIPATE BY SUBMITTING A BID, AND THE LOWEST COMPETITIVE BID IS
$1,000 AND THE 100TH LOWEST COMPETITIVE BID SUBMITTED IS $30,000,
THEN THE 100 SUCCESSFUL BIDS (I.E., THE 100 INDIVIDUALS WHO BID
$30,000 OR LESS) WILL EACH RECEIVE THE $30,000 BID.
9.  SEPARATION.
    A.  PER REF C, VSP APPROVAL AUTHORITY RESTS WITH THE ASSISTANT
SECRETARY OF THE NAVY FOR MANPOWER AND RESERVE AFFAIRS (ASN(M&RA)).
THEREFORE, A LISTING OF SUCCESSFUL BIDDERS, FOR EACH COMMUNITY WILL
BE SUBMITTED TO ASN (M&RA) FOR APPROVAL.
    B.  PERS-48 WILL NOTIFY ALL SUCCESSFUL BID APPLICANTS OF
APPROVAL AND AMOUNT OF SEPARATION PAY.
    C.  OFFICERS WILL HAVE UNTIL 30 SEPTEMBER 2006 TO SEPARATE.  A
POSITIVE VSP ELECTION, AND SUBMISSION OF A BID, CONSTITUTES AN
AGREEMENT ON THE PART OF THE PARTICIPATING OFFICER TO AGREE TO
SEPARATE FROM ACTIVE NAVAL SERVICE NLT 30 SEP 06.
    D.  MEMBERS WILL RECEIVE VSP IN A LUMP SUM UPON SEPARATION.
    E.  IF AN OFFICER HAS ACCEPTED VSP AND IS SUBSEQUENTLY SELECTED
FOR PROMOTION TO THE NEXT HIGHER PAY GRADE, HE/SHE WILL BE GIVEN THE
OPPORTUNITY TO WITHDRAW FROM CONSIDERATION OF VSP AND CONTINUE ON
ACTIVE DUTY.
    F.  IF AN OFFICER HAS ACCEPTED VSP AND IS SUBSEQUENTLY SELECTED
FOR LATERAL TRANSFER/REDESIGNATION TO THE REGULAR COMPONENT, HE/SHE
WILL BE GIVEN THE OPPORTUNITY TO WITHDRAW FROM CONSIDERATION OF VSP
AND CONTINUE ON ACTIVE DUTY.
10.  RECOUPMENT.  IN GENERAL, THE FOLLOWING SITUATIONS MAY REQUIRE
RECOUPMENT OF VSP (FOR SPECIFIC CRITERIA REFER TO REF A, AND REF B):
    A.  VOLUNTARY RETURN TO ACTIVE DUTY FOR GREATER THAN 180 DAYS.
    B.  QUALIFICATION FOR, AND RECEIPT OF, RETIRED OR RETAINER PAY.
    C.  RECEIPT OF DISABILITY COMPENSATION.
11.  OFFICERS WHO DO NOT MEET THE VSP ELIGIBILITY CRITERIA CONTAINED
IN THIS NAVADMIN, BUT WHO BELIEVE THEY SHOULD BE ALLOWED TO
PARTICIPATE IN THE VSP PROGRAM MUST CONTACT THEIR COMMUNITY MANAGER
TO DETERMINE IF THEIR APPLICATION WILL BE ACCEPTED FOR
CONSIDERATION.  VSP APPLICATIONS FROM SUCH OFFICERS WHO HAVE NOT
RECEIVED PRIOR PERMISSION TO APPLY WILL BE RETURNED WITHOUT ACTION.
12.  POC:  OFFICERS ARE ADVISED TO CONTACT THEIR DETAILER OR
COMMUNITY MANAGER FOR ANY QUESTIONS CONCERNING THE VOLUNTARY
SEPARATION PAY PROGRAM.
13.  RELEASED BY VADM J. C. HARVEY, JR., N1.//
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