White House Issues Veto Threat of Defense Policy Bill

Despite a veto threat from the Obama Administration, the Senate started their debate on the fiscal 2017 defense policy bill this week. 

In its Statement of Administration Policy, the White House outlined several areas of disagreement they have with the bill.  They also issued a warning in response to an amendment offered by Senate Armed Services Committee Chairman John McCain that would add $18 billion to the Defense Department budget by boosting the Overseas Contingency Operations (OCO) account. 

The White House statement cautions that “as the bill is considered by the Senate, it is critical that the Congress adhere to the principle that any increase in funding must be shared equally between defense and non-defense – a central tenet of last fall's budget agreement.”

In response to the McCain amendment, the committee’s top Democrat, Sen. Jack Reed, D-R.I., along with Sen. Barbara Mikulski, D-Md., are proposing a second-degree amendment that would authorize an equal boost for domestic funding. 

Show me the money

The Armed Services Committees authorize policies and programs.  The Appropriations Committees actually provide the money.  Sen. Charles Schumer, D-NY., has threatened to derail the appropriations process if the McCain amendment is adopted. 

“If the Republicans pass the defense amendment, but then block a similar increase to middle-class programs, they will have broken the budget agreement," Sen. Schumer said in a statement Tuesday. "And the appropriations process will come to a grinding halt.  They know that."

The administration’s other areas of concern with the bill include a provision that would radically restructure the military health system.  “The language severs the relationship between each Service and its medical department, jeopardizing the ability of the Department to readily provide operational medical support.  It also would separate the accountability for medical support to military missions and the responsibility for the quality of care from operational missions,” the statement said.

The White House objects to the committee’s failure to impose an enrollment fee for TRICARE for Life and their decision to phase-in TRICARE Choice enrollment fees for non-Medicare eligible retirees at slower pace.  Further, a provision which would allow "automatic renewal" of the TRICARE managed care contracts for up to 10 years, but then would “prohibit the incumbent from rebidding on the successor contract” is causing them heartburn as is a provision that would allow either party to terminate the contract with 180 days' notice.

The Administration accuses the committee of attempting to micromanage the Defense Department because of provisions that would reorganize DoD, prescribe the use of a wide range of contracting methods in circumstances that history has proven are not appropriate or efficient in meeting the military's needs, and prescribe across-the-board cuts to senior military billets, civilian executives, and contractors.

The Administration “strongly” objects to a provision that would return Basic Allowance for Housing (BAH) “to its distorted state from the mid-1990s, and reinstitute a burdensome and inefficient administrative-authorization process by limiting BAH payments to actual expenses.”

According to the White House statement, the provision would:

• undermine the structure by basing the allowance solely on grade and location (disregarding dependency status);
• inappropriately penalize some service members over others by linking their BAH payments to their status as members of dual-military couples (members married to other members);
• disproportionately affect female service members and those military families in which both military members have chosen to serve their country (20 percent of the women on active duty are in a dual-military marriage, compared with 3.8 percent of active duty men);
• hurt the recruitment and retention of high-quality service members and their families, making it difficult to sustain the all-volunteer force; and, 
• impact benefits under multiple VA educational assistance programs that are based on BAH rates, potentially decreasing payment amounts, increasing the complexity of benefit calculations, and negatively impacting the timeliness of benefit delivery.

In response to the veto threat, McCain said, “In its laundry list of imaginary doomsday scenarios, the Administration repeatedly misstates and misconstrues provisions of the NDAA, leaving one to wonder how closely Administration officials read this legislation, or whether they read it at all.  I hope when the NDAA reaches the President’s desk, he understands the critical importance of this legislation to our national security better than his Administration seems to now.”

Through all of the rhetoric, Senators did cast votes on amendments.  One would strike a provision that would create a pilot program for privatizing commissaries and another would remove restrictions in the committee-approved bill on funding medical research through the Defense Department.

Senate Majority Leader Mitch McConnell intends to finish work on the bill by Friday.