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Legislative Watch
30 April, 2015
Ted Painter, National Legislative Director
Email: [email protected]
Phone: 508-335-3616
In this week’s legislative watch:
AMRA’s Influence: House Armed Services Committee Passes 2016 National Defense Authorization Act;
Includes MCRMC Retirement Recommendation Compromise
AMRA Successful at Gaining Support for Companion House & Senate Legislation: Honor America’s
Guard-Reserve Retirees Act
AMRA’s Influence: House Armed Services Committee Passes 2016 National Defense Authorization
Act; Includes MCRMC Retirement Recommendation Compromise
On Thursday, April 23rd, the Military Personnel Subcommittee endorsed the Military Compensation and
Retirement Modernization Commission’s recommendation regarding overhauling the current military
retirement system. The recommended overhaul took one more step toward becoming law on Wed,
April 29th, when the full House Armed Services Committee passed the fiscal year 2016 National Defense
Authorization Act which includes nearly all of the Commission’s recommendations regarding military
retirement.
In a lopsided 55-8 vote, House Armed Services committee members agreed to usher in the new
“blended” military retirement plan, replacing the current system that has existed since the end of World
War II. If the full House accepts the plan next month and is followed by the Senate, it would take effect
for all new entrants on or after Oct. 1, 2017.
In short, the new retirement plan will reduce the current stipend received after 20 years of service from
50% of base pay to 40% of base pay and instead incorporate a 401K like Thrift Savings Plan (TSP) under
which the government would match member contributions up to five percent of basic pay. It is believed
that this investment option will more than make up for the reduction in the 20 year stipend.
Additionally, the new retirement system will include a continuation payment received at the 12 year
service mark. At a minimum this would equal two-and-half months of basic pay for active duty
careerists, or a half month of active duty basic pay for reserve component participants, assuming they
agree to serve four more years, out to 16.
AMRA strongly urged lawmakers to reconsider reducing the current stipend and seek funding for the
“blended” plan elsewhere. This would provide those who serve long enough to retire with peace of
mind by knowing that, regardless of shifts in the market or economic downturns, they would be
guaranteed a minimum of 50% of their base pay in retirement while still providing those who serve less
than 20 years with a financial package upon leaving military service.
While AMRA’s position was not fully incorporated, the HASC did compromise by modifying the
Commission’s recommendation to allow government matching to continue beyond 20 years and by also
adding 2% to the retirement stipend for each year served after 20 years—two aspects of the “blended”
plan that were not originally included. Thus, the new plan would keep a 50% retirement stipend in place
for those who retire after serving 25 years versus 20 years.
Currently serving members of the military will have the option to opt into the blended plan or stay with
their current plan, should the blended plan become law. All service members entering after 1 Oct, 2017
will be enrolled in the blended plan.
AMRA Builds Support for Companion House & Senate Legislation: Honor America’s Guard-Reserve
Retirees Act
The previous edition of the Legislative Watch stated that, upon meeting with legislative staff members
in the office of Congressman Walz, AMRA agreed to support HR 1384 and its Senate companion, S. 743:
The Honor America’s Guard-Reserve Retirees Act, and that we were in the process of building a coalition
of support among other Veteran Service Organizations. On April 29th, with the cooperation of 18
member associations of the National Military and Veterans Alliance, a letter of support was sent to the
sponsor of each Bill.
These pieces of legislation would grant veteran status to those Reserve component service members
who serve honorably and who qualify to retire after serving 20 or more years. It would not entitle these
retirees to any additional benefits as they are already eligible to receive military health care, shop on
base, receive some VA benefits including VA guaranteed home loans, and at age 60 they are entitled to
receive retirement pay.
AMRA is pleased to report that the following associations agreed to join our effort to advance these
pieces of legislation on behalf of Reserve and Guard retirees:
American Logistics Association
American Military Society
American Retirees Association
Army Navy Union
Association of the United States Navy
Gold Star Wives of America
Military Order of Foreign Wars
Military Order of the Purple Heart
Military Order of the World Wars
National Defense Committee
National Gulf War Resource Center
Reserve Officers Association
The Flag and General Officers Network
The Naval Enlisted Reserve Association
The Retired Enlisted Association
Tragedy Assistance Program for Survivors
Veterans of Foreign Wars
Veterans of Modern Warfare