CRSC vs CRDP

Camel Whisperer

PEB Forum Regular Member
Registered Member
Last Day in Military: 5/29/2023
Ch 61 Disability Retirement
National Guard on Title 10
Retired Pay (high 3): $5,000
7,056 Retired Points
39 1/2 years combo of National Guard/mobilizations
20-year letter issued 2003
30% DoD
90% VA ($2,700)

My State RSO is telling me to apply for CSRC. I am feeling so far the CRDP would be the better option. In either case, do I lose my TriCare Select?

Your Thoughts?
 
Last Day in Military: 5/29/2023
Ch 61 Disability Retirement
National Guard on Title 10
Retired Pay (high 3): $5,000
7,056 Retired Points
39 1/2 years combo of National Guard/mobilizations
20-year letter issued 2003
30% DoD
90% VA ($2,700)

My State RSO is telling me to apply for CSRC. I am feeling so far the CRDP would be the better option. In either case, do I lose my TriCare Select?

Your Thoughts?
No harm in applying for CRSC. DFAS will calculate between the 2 and give you whichever is higher. Have you reached 60 or less with qualifying reduction due to deployments? If not you won't get CRDP yet and your VA compensation will offset your chapter 61 retirement dollar for dollar of VA compensation received.

Chapter 61 is the same for insurance purposes so you can keep Tricare Select.
 
Last Day in Military: 5/29/2023
Ch 61 Disability Retirement
National Guard on Title 10
Retired Pay (high 3): $5,000
7,056 Retired Points
39 1/2 years combo of National Guard/mobilizations
20-year letter issued 2003
30% DoD
90% VA ($2,700)

My State RSO is telling me to apply for CSRC. I am feeling so far the CRDP would be the better option. In either case, do I lose my TriCare Select?

Your Thoughts?
Also, if you are eligible for your non regular retirement you may want to check to see if you need to apply for it or if DFAS will automatically calculate CRDP when eligible for it. CRDP requires retirement from TERA or any other 20 year retirement. Chapter 61 retirement doesn't qualify for CRDP.
 
My State RSO said I need to apply for a non-regular retirement with them and he wants me to apply for CRSC. I send that separate to the Army (DD 2860). So guess I apply for CSRS and CRDP and see which one pans out best for me. Thanks!
 
My State RSO said I need to apply for a non-regular retirement with them and he wants me to apply for CRSC. I send that separate to the Army (DD 2860). So guess I apply for CSRS and CRDP and see which one pans out best for me. Thanks!
I was not aware that the two programs are mutually exclusive. Why would they be?
 
My State RSO said I need to apply for a non-regular retirement with them and he wants me to apply for CRSC. I send that separate to the Army (DD 2860). So guess I apply for CSRS and CRDP and see which one pans out best for me. Thanks!
And…”I was not aware that the two programs are mutually exclusive. Why would they be?”

Comments:

A disability retiree can apply for non-regular retirement (if qualified) and upon approval (and meeting age requirement + VA =>50% VA), receive CRDP. One does not apply for CRDP.

CRSC requires a separate application.

CRSC and CRDP cannot be paid simultaneously.

Ron
 
CRSC and CRDP cannot be paid simultaneously.
@RonG I did not know that. What's the reasoning behind that, do you know? Why should a member who reached 20 years and was disabled due to an instrument of war have to choose between the two compensations when they earned both?

Genuinely curious, not arguing. I can't believe I didn't know this.
 
@RonG I did not know that. What's the reasoning behind that, do you know? Why should a member who reached 20 years and was disabled due to an instrument of war have to choose between the two compensations when they earned both?

Genuinely curious, not arguing. I can't believe I didn't know this.
Both mechanisms are to ensure Soldiers can get their earned longevity pension and VA disability. CRSC is a way to claw back VA recoupment of a pension and is most beneficial for those who didn't' complete 20 years or TERA retirement since those Soldiers don't qualify for CRDP.

Generally CRSC is better if it can max out recoupment of VA offset since CRSC is tax exempt whereas CRDP ensures you get both pension and VA disability at the same time so the pension part is taxable for most Soldiers. So if you can recoup the pension part lost via CRSC mechanism you get that amount tax free netting you slightly more compensation than CRDP.

The main thing most people don't realize is that you can't get more than the total amount earned through your longevity pension + VA compensation. CRDP and CRSC are just different programs that allow Soldiers to reach that max compensation.
 
Both mechanisms are to ensure Soldiers can get their earned longevity pension and VA disability. CRSC is a way to claw back VA recoupment of a pension and is most beneficial for those who didn't' complete 20 years or TERA retirement since those Soldiers don't qualify for CRDP.

Generally CRSC is better if it can max out recoupment of VA offset since CRSC is tax exempt whereas CRDP ensures you get both pension and VA disability at the same time so the pension part is taxable for most Soldiers. So if you can recoup the pension part lost via CRSC mechanism you get that amount tax free netting you slightly more compensation than CRDP.

The main thing most people don't realize is that you can't get more than the total amount earned through your longevity pension + VA compensation. CRDP and CRSC are just different programs that allow Soldiers to reach that max compensation.
Maybe that's where I am confused. I thought CRSC was Combat Related Special Compensation. Is there another CRSC I'm not tracking on?

I looked back on the DFAS CRSC page. There is a statement that CRSC beneficiaries must "waive VA pay from retired pay." Is that the clause that I am missing? Is that what makes it so that you only get one or the other?
 
Maybe that's where I am confused. I thought CRSC was Combat Related Special Compensation. Is there another CRSC I'm not tracking on?

I looked back on the DFAS CRSC page. There is a statement that CRSC beneficiaries must "waive VA pay from retired pay." Is that the clause that I am missing? Is that what makes it so that you only get one or the other?
That is what it was called. Originally CRSC was created to help Soldiers recoup monies received from VA offset up to a max amount though you can get less if the VA rated condition compensation is less than the overall offset. Then a couple years later CRDP was passed that basically covered everything who had 50% VA rating and a 20 year retirement or TERA retirement. The reason CRSC recipients must accept VA disability is that must happen to then allow the recoupment of the pension amount lost.
 
Maybe that's where I am confused. I thought CRSC was Combat Related Special Compensation. Is there another CRSC I'm not tracking on?

I looked back on the DFAS CRSC page. There is a statement that CRSC beneficiaries must "waive VA pay from retired pay." Is that the clause that I am missing? Is that what makes it so that you only get one or the other?
Basically if you don't accept to receive VA compensation then you can't get CRSC. That is what "Waive VA pay from retired pay means". So basically just make sure to not check box 26 of the application for benefits:)
 
Maybe that's where I am confused. I thought CRSC was Combat Related Special Compensation. Is there another CRSC I'm not tracking on?

I looked back on the DFAS CRSC page. There is a statement that CRSC beneficiaries must "waive VA pay from retired pay." Is that the clause that I am missing? Is that what makes it so that you only get one or the other?
See this brochure link: https://soldierforlife.army.mil/Documents/static/Post/CRSC_and_CRDP.pdf

"In order to receive disability compensation since the late 1800s, retired veterans with disabilities waived an equal amount of their regular retired pay. In December 2002 (CRSC) and January 2004 (CRDP), Congress enacted legislation to restore some or all of the military retired pay these veterans waived."
 
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@RonG I did not know that. What's the reasoning behind that, do you know? Why should a member who reached 20 years and was disabled due to an instrument of war have to choose between the two compensations when they earned both?

Genuinely curious, not arguing. I can't believe I didn't know this.
Some history about Concurrent Receipt

Concurrent receipt refers to the simultaneous receipt of two types of monetary benefits: military retired pay and Department of Veterans Affairs (VA) disability compensation. With several separate programs, varying eligibility criteria, and several eligibility dates, some observers find the subject complex and somewhat confusing.

There are, however, two common criteria: first, all recipients are military retirees; second, they are also eligible for VA disability compensation. This report addresses the two primary components of the concurrent receipt program: Combat-Related Special Compensation (CRSC) and Concurrent Retirement and Disability Payments (CRDP). It reviews the possible legislative expansion of the program to additional populations and provides several potential options for Congress to consider.

Background

In 1891, Congress first prohibited payment of both military retired pay and a disability pension under the premise that it represented dual or overlapping compensation for the same purpose. The original law was modified in 1941, and the present system of VA disability compensation offsetting military retired pay was adopted in 1944. Under this system, retired military personnel were required to waive a portion of their retired pay equal to the amount of VA disability compensation, a dollar-for-dollar offset.1 If, for example, a military retiree received $1,500 a month in retired pay and was rated by the VA as 70% disabled (and therefore entitled to approximately $1,000 per month in disability compensation), the offset would operate to pay $500 monthly in retired pay and the $1,000 in disability compensation.

The advantage for the retiree was that VA disability compensation was not taxable. For many years some military retirees and advocacy groups sought a change in law to permit receipt of all, or some, of both payments. Opponents of concurrent receipt frequently referred to it as double dipping, maintaining that it represented two payments for the same condition.
In the FY2003 NDAA (P.L. 107-314), Congress created a benefit known as Combat Related Special Compensation (CRSC).

CRSC provided, for certain disabled retirees whose disability is combat-related, a cash benefit financially identical to what concurrent receipt would provide them. The FY2004 NDAA (P.L. 108-136) authorized, for the first time, the phase-in of actual concurrent receipt (now referred to as Concurrent Retirement and Disability Payments or CRDP), and a greatly expanded CRSC program. The FY2005 NDAA (P.L. 108-375) further liberalized the concurrent receipt rules contained in the FY2004 NDAA and authorized immediate concurrent receipt for those rated by the VA totaling 100%. The FY2008 NDAA (P.L. 110-181) expanded concurrent receipt eligibility to include those who are 100% disabled due to unemployability and provided CRSC to those who were medically retired or retired prematurely due to force reduction programs prior to completing 20 years of service. CRDP phase-in was fully implemented by 2014, allowing retirees with a disability rated at 50% or greater to receive full retired pay and full VA disability compensation without an offset.

—-
Ron
 
Hello @PERS-95

Ref: “Maybe that's where I am confused. I thought CRSC was Combat Related Special Compensation. Is there another CRSC I'm not tracking on?
I looked back on the DFAS CRSC page. There is a statement that CRSC beneficiaries must "waive VA pay from retired pay." Is that the clause that I am missing? Is that what makes it so that you only get one or the other?”

1. CRDP = allows for concurrent receipt of longevity retired pay and VA compensation.
CRSC = replaces some of all of waived longevity retired pay.

2. Current law prohibits receiving both simultaneously.

3. “Accepting VA Comp or Retired Pay “
It is not one or the other. It is a decision whether to waive retired pay dollar for dollar in the amount of VA comp in order to receive the VA comp. Occasionally, retired pay (residual) remains and is paid too.

Ron
 
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@PERS-95

There are many videos on YouTube that explain the difference as well. I retired last year under CRDP and had to apply for CRSC. My mypay has a CRSC link but nothing yet, since I was recently approved for CRSC. RonG told me that based on the rating that Army HRC decided on; that will afford all my Army pension to be tax-free. Unlike before where I was paying about 415 bucks a month in federal taxes. I am in a state that is tax exempt as well. https://www.youtube.com/results?search_query=crsc+vs+crdp
 

Comparing CRSC and CRDP (DFAS)

Retirees cannot receive both Combat Related Special Compensation (CRSC) and Concurrent Retirement and Disability Pay (CRDP). If you qualify for both, in the initial year of your joint eligibility, DFAS will automatically apply the entitlement that is most beneficial to you based on your gross amount of each entitlement. This will remain in effect until the next CRDP/CRSC Open Season. You will receive an initial CRDP/CRSC Election form shortly following your joint eligibility. Complete and return the form within 45 days if you wish to change to the entitlement that we did not select for you. In subsequent years, you will need to make this determination yourself during Open Season. Open season usually takes place in January.

The chart below highlights the differences between the two programs to help you decide which one is better for you.


CRSCCRDP
Qualified Injurycombat-linked disabilitiesservice-connected disabilities
Classification Special Compensation (not subject to rules and regulations governing military retired pay)Military retired pay (subject to rules and regulations governing military retired pay)
Full Concurrent Receipt?Yes - Retirees can receive either part or all of both their military retirement pay and VA disability compensationNo - Restoration of pay is phased in over 10 years (from 2004 to 2014)
Claim ProcessMust apply through Branch of ServiceAutomatic
EligibilityEligible claimants:
  • Are entitled to and/or receiving military retired pay
  • Are rated at least 10% by the Department of Veteran’s Affairs (VA)
  • Are least 60 years old or retired under Temporary Early Retirement Authority (TERA) if they are a reservist
  • Have waived their VA pay from their retired pay
Eligible claimants:
  • Are retired with 20 years Active or Reserve Duty
  • Are receiving retired pay (that is offset by VA payments)
  • Have a 50% + VA disability rating
  • Reservists and national guardsmen must be eligible to retire based on service, normally 60 years old
Retroactive EntitlementMay go back to June 1, 2003, for any month in which all eligibility requirements are satisfied but may be limited to retirement date.

Disability retirees with less than 20 years will be automatically limited to a retroactive date of January 1, 2008 as required by legislation passed by Congress effective 2008.
May go back to January 1, 2004, for any month in which all eligibility requirements are satisfied, but may be limited to retirement date.

CRDP is not payable before January 1, 2004.
Federal TaxationNon-taxableTaxable, according to your current retired pay Federal Income Tax Withholding (FITW) tax rate
Issue of PaymentCRSC payments are deposited to the same account where you receive your retired pay. If your VA disability compensation offset exceeds your retired pay, your CRSC payment will be deposited into the account most recently designated as your current checking address.CRDP is not a new payment, but rather an increase in your retired pay. CRDP decreases your VA waiver so that you receive more of your gross retired pay. Your new pay amount will continue to be deposited into the same account and will not affect your compensation from the VA.
Subject to Division with a Former SpouseNo*Yes
Subject to Collection / GarnishmentYesYes
SBP (Survivor Benefit Plan) Premiums DeductedYes**Yes
**Beginning with the Survivor Benefit Plan (SBP) recurring monthly premiums due in April of 2018, DFAS is deducting SBP monthly premiums from Combat-Related Special Compensation (CRSC) when retired pay is not sufficient to cover the full amount of the recurring monthly premiums.

Find out more about the VA Waiver, CRDP and CRSC on the webpage: Understanding the VA Waiver and Retired Pay/CRDP/CRSC Adjustments

If you need help, contact DFAS at 800-321-1080. Customer service representatives are available Monday through Friday from 8 a.m. to 4:30 p.m. (ET).

Note: The information on this website is provided to explain typical situations regarding retiree and annuitant benefits. For details and exceptions, please see applicable laws, financial management regulations, and instructions.

Ron
 
From DFAS

CRDP/CRSC Open Season Frequently Asked Questions

It is possible to be eligible for both Concurrent Retirement and Disability Pay (CRDP) and Combat-Related Special Compensation (CRSC). However, you cannot receive both of them at the same time. If you ’re eligible for both, CRDP/CRSC Open Season is when DFAS will send you a letter with instructions about how to change your election from one program to the other, if you choose.

2023 Open Season is January 1-31, 2023. Election change requests must be postmarked by January 31, 2023.

FAQs

Why did I receive an Open Season letter?
Do I need to return my election letter if I want to remain under the same program?
What happens if I forgot to check the box on the form?
What if I made a mistake and want to switch back to the program I was previously receiving?
What if my address has changed or I will be out of the state/country during Open Season?
What if I am tax exempt?
What happens to my Retired Pay if I switch to CRSC?
What happens to my Retired Pay if I switch to CRDP?
Will I lose my VA pay if I switch to either CRDP or CRSC?
What if I have a Former Spouse who receives a portion of my retired pay?
What happens if I switch to CRSC and my allotments stop?
What happens to my Survivor Benefit Plan (SBP) if I switch to CRSC?
What happens if my CRDP or CRSC entitlement changes mid-year?
My VA disability award increased, why is my CRSC entitlement still the same?


Q: Why did I receive an Open Season letter?

A: Retirees who are eligible for both CRDP and CRSC will receive an annual Open Season letter with the amount of both entitlements. Since retirees cannot receive both entitlements, you have the opportunity to make an election during each Open Season.

Q: Do I need to return my election letter if I want to remain under the same program?
A: No, you are not required to respond if you want to keep your election the same. If an Open Season election form is not returned by the deadline, we will treat this as a passive election and continue to pay you under the same program until the next annual Open Season.

Q: What happens if I forgot to check the box on the form?
A: Returning the form with a signature and an unchecked “change my entitlement” box will result in an unclear election and may delay any changes you do wish to make. Please return the form and check the box only if you wish to CHANGE programs. No action is required if you wish keep your election the same.

Q: What if I made a mistake and want to switch back to the program I was previously receiving?
A: As long as you notify us by phone or written correspondence by the deadline of your chosen election, we can make the change for you. Requests to switch programs made or postmarked after the deadline cannot be processed.

Q: What if my address has changed or I will be out of the state/country during Open Season?
A: We suggest verifying the mailing address on your retired pay account is correct in early December of each year. If you know you will have a different, temporary address during the Open Season period, please be sure to update this information as early as possible. The Open Season letter is time sensitive. Address changes can be made in myPay, by phone or by sending your request in writing by mail or fax. If you forgot to change your address in time, please contact us directly at 800-321-1080 so we can update your information and send a new letter. Your election change request must be postmarked by the deadline.

Q: What if I am tax exempt?
A: If your Federal Tax status is E (or Exempt), you will receive the same amount of pay under either program, because neither entitlement would be taxed.

Q: What happens to my Retired Pay if I switch to CRSC?
A: If you elect to receive CRSC, your retired pay will be offset by the full amount of your VA disability pay. You may still receive some retired pay if your retired pay exceeds your VA disability pay. Or you may not receive any retired pay at all if your VA award exceeds your retired pay. You will also begin to see an amount under “VA Waiver” on your Retiree Account Statement (RAS). Please keep in mind if you switch to CRSC any allotments, Former Spouse deductions or garnishments may be suspended if there are not enough funds left to pay out of your retired pay. CRSC payments are subject to deductions for monthly SBP premiums or garnishments. Also, CRSC is non-taxable, so it is issued separately from your retired pay. You may begin to receive two separate payments from DFAS each month, one for retired pay (taxable) and one for CRSC (non-taxable).

Example: $1000.00 (Gross Retired Pay) Minus VA Pay ($450.00) = $550.00 (Net Retired Pay - taxable)
Plus $250.00 CRSC pay (non-taxable) = Total of $800.00 from DFAS

Q: What happens to my Retired Pay if I switch to CRDP?
A: If you elect to receive CRDP, your VA Waiver will be reduced by the amount of your CRDP pay. As a result, your taxable/disposable income will increase. Former Spouse deductions or garnishments will also increase, if your disposable incomes. SBP monthly premiums (if applicable) will be deducted from your retired pay. In addition, if you want to start or resume any allotments, you will need to make a request through myPay to start these deductions. Since you will no longer receive a separate payment for CRSC, you will only receive one payment for your Retired Pay/CRDP.

Q: Will I lose my VA pay if I switch to either CRDP or CRSC?
A: No, your VA disability pay is separate from CRDP and CRSC. Regardless of your election, you will continue to receive your monthly disability payment from the VA, which is non-taxable.

Q: What if I have a Former Spouse who receives a portion of my retired pay?
A: It is important to understand CRSC is not subject to the provisions of the Uniformed Services Former Spouse Protection Act. This means if you switch to CRSC, your former spouse’s payments may decrease, or stop altogether. This is because the amount of your disposable income may change, depending on the amount of your VA Waiver. CRSC payments are subject to garnishments for alimony and child support.

Q: What happens if I switch to CRSC and my allotments stop?
A: Allotments cannot be deducted from your monthly CRSC payment. If there is no retired pay (or not enough retired pay) to deduct allotments from, some allotments, such as those for Delta Dental or Tricare, will require you to begin making payments out of pocket directly to the agencies to maintain your benefits.

Q: What happens to my Survivor Benefit Plan (SBP) if I switch to CRSC?
A: If there is not enough retired pay to cover your monthly recurring SBP premiums, they will automatically be deducted from your CRSC payments. If your beneficiaries are covered by the Survivor Benefit Plan, your spouse/child(ren) are still eligible to receive SBP even if you switch to CRSC.

Q: What happens if my CRDP or CRSC entitlement changes mid-year?
A: All Open Season election forms must be received or postmarked by the deadline. It is important to understand you will not be able to switch programs after this date until the following annual Open Season, even if there is an increase or decrease to one or both of your entitlements. When determining which program is best for you, keep in mind any pending VA claims/awards as well as any pending CRSC reconsideration claims, because these may affect your entitlements. Your entitlements are calculated using the most current information we receive from the VA and your Branch of Service at the time the letters are mailed.

Q: My VA disability award increased, why is my CRSC entitlement still the same?
A: Increases to your CRSC award are not always automatic. If the VA awards new service-connected disabilities, you must submit a reconsideration claim to your respective Branch of Service. They determine which disabilities are combat-related, not DFAS. If they approve any additional combat-related disabilities, then a copy of the new CRSC award letter will be forwarded to our office to update your account and entitlement accordingly. Please visit Defense Finance and Accounting Service > RetiredMilitary > disability > applyforcrsc for more information on filing a reconsideration request.

===
Ron
 

Comparing CRSC and CRDP (DFAS)

Retirees cannot receive both Combat Related Special Compensation (CRSC) and Concurrent Retirement and Disability Pay (CRDP). If you qualify for both, in the initial year of your joint eligibility, DFAS will automatically apply the entitlement that is most beneficial to you based on your gross amount of each entitlement. This will remain in effect until the next CRDP/CRSC Open Season. You will receive an initial CRDP/CRSC Election form shortly following your joint eligibility. Complete and return the form within 45 days if you wish to change to the entitlement that we did not select for you. In subsequent years, you will need to make this determination yourself during Open Season. Open season usually takes place in January.

The chart below highlights the differences between the two programs to help you decide which one is better for you.


CRSCCRDP
Qualified Injurycombat-linked disabilitiesservice-connected disabilities
ClassificationSpecial Compensation (not subject to rules and regulations governing military retired pay)Military retired pay (subject to rules and regulations governing military retired pay)
Full Concurrent Receipt?Yes - Retirees can receive either part or all of both their military retirement pay and VA disability compensationNo - Restoration of pay is phased in over 10 years (from 2004 to 2014)
Claim ProcessMust apply through Branch of ServiceAutomatic
EligibilityEligible claimants:
  • Are entitled to and/or receiving military retired pay
  • Are rated at least 10% by the Department of Veteran’s Affairs (VA)
  • Are least 60 years old or retired under Temporary Early Retirement Authority (TERA) if they are a reservist
  • Have waived their VA pay from their retired pay
Eligible claimants:
  • Are retired with 20 years Active or Reserve Duty
  • Are receiving retired pay (that is offset by VA payments)
  • Have a 50% + VA disability rating
  • Reservists and national guardsmen must be eligible to retire based on service, normally 60 years old
Retroactive EntitlementMay go back to June 1, 2003, for any month in which all eligibility requirements are satisfied but may be limited to retirement date.

Disability retirees with less than 20 years will be automatically limited to a retroactive date of January 1, 2008 as required by legislation passed by Congress effective 2008.
May go back to January 1, 2004, for any month in which all eligibility requirements are satisfied, but may be limited to retirement date.

CRDP is not payable before January 1, 2004.
Federal TaxationNon-taxableTaxable, according to your current retired pay Federal Income Tax Withholding (FITW) tax rate
Issue of PaymentCRSC payments are deposited to the same account where you receive your retired pay. If your VA disability compensation offset exceeds your retired pay, your CRSC payment will be deposited into the account most recently designated as your current checking address.CRDP is not a new payment, but rather an increase in your retired pay. CRDP decreases your VA waiver so that you receive more of your gross retired pay. Your new pay amount will continue to be deposited into the same account and will not affect your compensation from the VA.
Subject to Division with a Former SpouseNo*Yes
Subject to Collection / GarnishmentYesYes
SBP (Survivor Benefit Plan) Premiums DeductedYes**Yes

**Beginning with the Survivor Benefit Plan (SBP) recurring monthly premiums due in April of 2018, DFAS is deducting SBP monthly premiums from Combat-Related Special Compensation (CRSC) when retired pay is not sufficient to cover the full amount of the recurring monthly premiums.

Find out more about the VA Waiver, CRDP and CRSC on the webpage: Understanding the VA Waiver and Retired Pay/CRDP/CRSC Adjustments

If you need help, contact DFAS at 800-321-1080. Customer service representatives are available Monday through Friday from 8 a.m. to 4:30 p.m. (ET).

Note: The information on this website is provided to explain typical situations regarding retiree and annuitant benefits. For details and exceptions, please see applicable laws, financial management regulations, and instructions.

Ron
Damn. I need this as a saveable graphic. Too big for a single screenshot.
 
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