We have 2 Action Items today, at Issue 1 and 3 below
Summary of Issues
At Issue 1. we see 86 BAH? Troops living together could soon see significant cuts. In his June edition of the “The Bottom Line,” MOAA Director of Government Relations Col. Mike Hayden, USAF (Ret) looks at a controversial new provision on housing allowances. (See Issue 1 below for the details and to send messages to your Senators. GF)
At Issue 2. we see DOD ECHOES MOAA’S CONCERNS IN RETIREMENT REFORM. Joint Chief echoes MOAA’s concerns. The Joint Chief speak out for career servicemembers. (See Issue 2 below for the details. GF)
At Issue 3. we see LAWMAKERS FACE UPHILL BATTLE ON PAY RAISE. House votes to give servicemembers full 2.3% pay raise. Will the Senate play ball? (See Issue 3 below for the detailsand to send messages to your Legislators. GF)
At Issue 4. we see WILL TROOPS ACCEPT NEW RETIREMENT REFORMS? New report on retirement reform. (See Issue 4 below for the details. GF)
Collectively We Can and Are Making a Difference
FOR ALL, Please feel free to pass these Weekly Legislative Updates on to your group of Veteran Friends –
don’t be concerned with possible duplications – if your friends are as concerned as we are with Veteran issues, they probably won’t mind getting this from two or more friendly sources
ISSUES
Issue 1. The Bottom Line – 86 BAH?
June 5, 2015
By Col. Mike Hayden, USAF (Ret)
A contentious new proposal cuts housing allowances for more than 40,000 troops.
In language approved by the Senate Armed Services Committee, servicemembers married to other servicemembers living off base will no longer receive two Basic Allowances for Housing (BAH).
How much will this “marriage tax” cost a married couple? If you’re stationed in any of these cities, a lot:
The proposal received serious flak from MOAA and other advocacy groups, troops, and the administration.
The marriage tax restricts BAH to the spouse of higher rank, eliminating the benefit entirely for the other spouse. The proposal is particularly detrimental to women servicemembers, 20 percent of whom are in dual-military marriages, compared to less than 4 percent of their male counterparts.
If that wasn’t enough, the marriage tax also includes a provision that cuts BAH by 25 percent to troops sharing an apartment or home. When I was a junior airman, a cut this steep would be significant enough to dissuade me from getting a place with someone in my squadron.
This is about more than a couple of junior troops deciding to give up their privacy in order to scrounge up extra savings every month. This is a serious cut to the overall package needed to keep pace with private sector peers.
Administration officials ultimately concluded that the proposal would negatively affect recruiting and retention of the all-volunteer force, and MOAA agrees.
The Pentagon uses a specific formula – consisting of basic pay, an allowance for subsistence, federal tax advantages, and BAH – to keep military compensation on pace with private-sector workers.
Because troops have little say in where the services assign them, BAH provides a monthly stipend equal to the local average rental cost to help offset their expenses. DoD uses annual surveys of civilian housing costs to determine payment levels near installations.
Currently, about 70 percent of the force lives off an installation post. DoD likes it that way; troops like it that way. DoD saves money on upkeep on costly installations. It allows military families to assimilate into their local communities.
What’s going to be the effect of this thoughtless proposal? Will troops seeking a relationship with someone in uniform be willing to absorb the marriage tax? Will it also dissuade servicemembers from marrying each other? Dual-military married couples could seriously consider having one spouse leave the service. Are we willing to lose these talented men and women?
The Bottom Line : Changing housing allowances based on marriage or cohabitation significantly undermines the fairness of military pay and puts troops at a competitive disadvantage to their private sector peers.
86 BAH? What the heck?
Act now: Send your senators a MOAA-suggested message asking them to strip the marriage tax from the defense bill.
(Click on MOAA-suggested message or 86 BAH? here or above or go to Here is the Process: at the end of this Email to send messages to your Senators. GF)
Issue 2. DOD ECHOES MOAA’S CONCERNS IN RETIREMENT REFORM
June 5, 2015
DoD is giving Congress cautious approval on moving forward with retirement reform. After months of internal deliberation, one of the Joint Chiefs of Staff came out in support of recent proposals on some of the biggest changes to military compensation in a generation.
On May 21, in a virtual town hall with enlisted airmen, Air Force Chief of Staff Gen. Mark Welsh used messaging similar to what MOAA has been saying on Capitol Hill over the past two years: “Don’t reward people who stay less than 20 by hurting people who stay more than 20.”
Since January, Congress has been weighing the merits of a report by the Military Compensation and Retirement Modernization Commission (MCRMC) that calls for reductions in military pensions and moving troops to a blended retirement system. As part of its list of recommendations, the MCRMC proposed cutting military retirement by 20 percent. In exchange, troops would receive government contributions to Thrift Savings Plan (TSP) accounts, the federal employee equivalent to a 401(k) account. Government contributions would stop after 20 years of service, regardless of whether or not the servicemember continues to remain in uniform.
Welsh and the other Joint Chiefs will ask Congress to support another MOAA position: extend government contributions to TSP accounts to troops serving more than 20 years. According to Welsh, stopping contributions at the 20-year mark makes “no sense.”
“This is what MOAA’s been saying all along. We’re glad to see the Joint Chiefs are not only hearing, but echoing our talking points,” said MOAA’s Director of Government Relations Col. Mike Hayden, USAF (Ret.).
MOAA supports providing a portable career device for those who leave the service prior to the 20-year point, but we have serious concerns that the MCRMC’s proposal will fail to provide the necessary draw to retain members to 20 years of service.
Congress is currently considering two options for military retirement. Members of the Senate Armed Services Committee essentially adopted the MCRMC’s retirement proposal in its version of the FY16 defense bill.
House lawmakers, however, wisely understood that stopping TSP contributions at the 20-year mark would provide a disincentive to remain in uniform. When the House passed its version of the defense bill in May, they voted to extend government contributions for troops serving more than 20 years.
“What we’d really like,” said Hayden, “is for Congress to take more time to study the second- and third-order effects of these retirement proposals.”
Discrepancies between the two bills will have to be resolved in conference committee later this summer-
Issue 3. LAWMAKERS FACE UPHILL BATTLE ON PAY RAISE
June 5, 2015
House lawmakers approved a 2.3 percent active duty pay raise.
On June 2, the House Appropriations Committee approved funding for the FY16 defense bill. Included in the bill was support for a fully funded active duty pay raise and funding to maintain 100 percent of troop housing costs through housing allowances.
On passage of the bill, Defense Subcommittee Chairman Rodney Frelinghuysen (R-N.J.) said, “I am proud that we have kept faith with the brave men and women, and their families, who selflessly serve our country.”
But they’ll face an uphill battle getting the provision signed into law.
In its version of the annual defense bill, the Senate Armed Services Committee (SASC) approved the administration’s proposal to cap military pay at 1.3 percent.
For the last two years, the Senate and the administration have capped pay raises.
In 2003, Congress tied military pay increases to the Employment Cost Index (ECI) to keep military pay competitive with the private sector. Congress recognized that annually raising active duty pay at the same pace as the private sector is essential to sustaining a quality force. Under this law, servicemembers should receive a 2.3 percent pay raise.
This erosion of pay puts servicemembers at a disadvantage to their private sector peers.
“A third straight year of pay caps sends the wrong message to troops,” said MOAA’s Deputy Director of Government Relations, Col. Mike Barron, USA (Ret.). “Pay comparability can’t work unless it’s sustained through both good and bad times.”
Troops burdened by over a decade of war have had their last four raises average less than 1.4 percent. The last two years of pay raises were the lowest in 50 years.
“House lawmakers have done the right thing with supporting the 2.3 percent pay raise. It’s time for the Senate to do the same,” said Barron.
Act now to send your senators an MOAA-suggested message asking them to
(Click on an MOAA-suggested message here or above or go to Here is the Process: at the end of this Email to send messages to your Legislators. GF)
Issue 4. WILL TROOPS ACCEPT NEW RETIREMENT REFORMS?
June 5, 2015
As momentum to overhaul the military retirement system gains speed on Capitol Hill, a new report by the Congressional Budget Office (CBO) provided predictions on if currently serving troops would convert to the new system.
House and Senate lawmakers are proposing overhauls to military retirement by combining the existing defined benefit with a portable retirement device. In exchange for cutting military retirement by 20 percent, lawmakers would provide government-matched contributions to 401(k) accounts.
The House proposal provides a government match up to 5 percent and continues the match throughout an entire career. The Senate proposal provides only a 4 percent match (after two years of service) and stops government contributions at 20 years of service.
Neither proposal requires currently serving troops to participate in the plan. Troops would have the option to opt in to the program. Once adopted, new servicemembers would be automatically enrolled in the new system.
Proponents of the plans say both proposals offer a better deal for the 83 percent of troops who do not serve until eligible for a military retirement, and currently receive no retirement benefits from the government.
For a much smaller portion of the force – the mid-grade officers and non-commissioned officers planning to serve a full career – the benefits of a blended system are more complex.
Members with more than 12 years of service would have little or no incentive to switch to the new plan. CBO estimates that none of those members would make the switch.
The report estimates that about 50 percent of servicemembers with 12 years of service or less during the opt-in period would make the switch to the new system.
Both proposals offer continuation pay at the 12-year point in a career. However, what the report fails to mention is that servicemembers are unable to invest their continuation pay back into their TSP accounts.
“Troops at this stage in their careers face a very tough decision,” said MOAA’s Deputy Director of Government Relations, Col. Mike Barron, USA (Ret.). “They won’t be able to make up the difference in lost TSP contributions by twenty years of service.”
In a recent virtual town hall , Air Force Chief of Staff Gen. Mark Welsh told concerned airmen, “Those of you who aren’t sure, stick with the old plan. You know what you got.” (Click on recent virtual town hall here or above to see the Town Hall details. GF)
The CBO report also estimated that the number of servicemembers that will opt-in to the new plan would increase for those with fewer years of service, so that 100 percent of servicemembers with only one or two years of service would choose to switch.
Though there are significant differences between the House and Senate proposals, the CBO report did not find any statistical differences in opt-in rates of servicemembers.
DoD is expected to provide its take on the military retirement reform proposals over the next month.
Before Congress rushes to overhaul the retirement system, MOAA believes these proposals require further study.
Here is the Process: If the steps below are new to some, I recommend that you review all of the steps and then you might want to copy this process by high lighting all of the steps below. Then click on “File” at the top of your screen, select “Print“, then click on “Selection” at the next display and then hit “Print“; or print the selected portion as you usually do this kind of task.
- Click here onhttp://capwiz.com/moaa/issues/ or copy and paste it in your browser to put you at the “Legislative Action Center” screen.
- Scroll downunder “Current Action Alerts” and click on Act Now to Block Huge Cuts to Military Pay the first time through this process. And the second time through The Process click onAct Now on TRICARE, Pay, and Housing.
- At the next screen enter your Zip code if requested and/orhit “Go!” and/or scroll down to “Take Action” and at “Compose Message” leave ‘Email‘ checked or check ‘Printed Letter‘ to send Printed Letters instead of sending Emails if desired .
- If an “Issue Area:”line appears just before the Editable Text: and doesn’t have an issue shown, click on the down arrow and select an issue; e. g., Military, Veterans Affairs, etc. (usually required on messages to our Senators)
- Scroll down to the “Editable text” areaand edit/modify the text of the message if desired.
- Insert “Your Closing” (I show ‘Respectfully), and “Your Name” and fill in the rest of the mandatory {asterisked} SENDER INFORMATION. The “Phone”number is now required by some Legislators (it’s required if your Senator is from Arizona) . Fill in the “Guest Type“, “Service“, “Rank“, “Component“, and “Status” if you want that information to show in your message (recommended). You may be prompted to include a phone number if you try to send the message without entering your phone number. Don’t be concerned about entering a phone number. I haven’t received return calls except on rare occasions to thank me for my interest in a particular piece of Legislation, at which time you can comment (pro or con) to the staff member on how the Senator stands on the issue.
- Check “Remember Me” (recommended) if you don’t want to have to re-enter all of your Sender Information the next time you send a message. You can always change your information or uncheck ‘Remember Me’ anytime in the future.
- Check ‘Yes‘ or ‘No‘ as to whether you want to have a copy of your letter sent to your Email Address (suggested at least for you initial efforts, and to see how your personal data is included in the message).
- Hit “Send Message”
- If Printed Letter was selected at Step 3 above, at the screen after hitting “Send Message” leave “Plain Paper Style” and “Word Processor (RTF)” checked unless you have another preference. Then left click on “Print Letter(s)” at the end of the “PRINT LETTER” screen. At the File Download” alert that appears next, click on “Open”. You can then edit and print or save the letter for editing, printing, signing and mailing.
- For Arizona residents, because of some current problems with contacting Sen Flake by Email,you will, see after hitting “Send Message” at Step 9 above, that “Printed Letter” is the only option for getting your message to him. Step 10 above tells you how to do that for that.
- Repeat this process for Issue 3.to send the Act Now on TRICARE, Pay, and Housingmessage to your Legislators.
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That’s it for today- Thanks for your help!
