18 December 2014 Legislative News Update
18 December 2014 Legislative News Update
weekly electronic newsletter, and is published every Monday when Congress is in session. In this issue:
- WINS, LOSSES AND DRA
★★★2014 was a very interesting year. We started the year with some measure of relief that Congress had provided a temporary reprieve from sequestration. The Budget Control Act, passed in December 2013, restored budget certainty for the Army for two years and paved the way for appropriations legislation that provided more financial flexibility within Army accounts. However, 2014 also started out with a battle we had not expected: The discovery of a provision Congress included in the Budget Control Act which negatively affected the calculation of the Cost of Living Allowance (COLA) for under-age-62 military retirees by requiring a one percent reduction in COLA for military retirees until they reach age 62. Determined to push Congress to fix their ill-advised provision, AUSA President Gen. Gordon R. Sullivan, USA, Ret., immediately met with key lawmakers who shared his same goal. He, along with several other military association leaders appeared before the Senate Armed Services Committee to explain just how egregious the provision was. Ultimately, Congress did the right thing and voted overwhelming to reinstate cost-of-living hikes in the pensions for all current retirees and anyone who enlisted before Jan. 1. 2014 (The FY 2015 National Defense Authorization Act (NDAA) extends the retiree one-percent COLA cut to service members who joined the military after January 1, 2016.) It didn’t take long; however, for the next battle lines to be drawn. Among the proposals included in the president’s budget request for fiscal 2015 were plans to cut housing allowances (BAH) by 5 percent, reduce the annual direct subsidy provided to military commissaries by $1 billion over three years, consolidate TRICARE health plans, adjust deductibles and co-pays as well as the implementation of a means-tested TRICARE for Life (TFL) enrollment fee and increased pharmacy fees. Sullivan and the Association spent the next several months in contact with lawmakers and congressional staff members outlining our position on and opposition to these proposals. In the end, Congress either outright rejected items in the budget request or significantly reduced them. Commissary funding was restored and BAH was only reduced by one percent and for only one year. Instead of consolidating TRICARE health plans and implementing fees, Congress only raised pharmacy fees by $3.00 and only for one year. We did take note in the Joint Explanatory Statement that accompanied the NDAA that the defense committees will “commit to reconsider” these proposals again. The two huge shadows hanging over AUSA and the defense world in 2015 will be the return of sequestration and the results of the congressionally-mandated Military Compensation and Retirement Modernization Commission whose report is due on February 1, 2015. We have no idea what the Commission will recommend. We have no idea how Congress will address sequestration. We do know that if it returns as scheduled in 2016, Congress believes DoD will “need to make painful cuts and achieve substantial savings across its entire budget in order to avoid an unacceptable reduction in readiness.” At least that is what lawmakers said in the Joint Explanatory Statement. We find this a little ironic since it is Congress that repeatedly ties DoD’s hands and refuses to allow it to divest itself of unneeded equipment and programs. Sequestration, retirement commission recommendations, new leadership and members in the Armed Services Committees and a new Defense Secretary. The one thing we can say is that 2015 and the 1st Session of the 114th Congress will not be dull. This Association stands ready to fight any further chipping away at pay and benefits. Happy Holidays to all of you from the Government Affairs Team. To those troops who will not be able to spend the holidays with your families, our thoughts and prayers are with you.