House OKs Bill With Pay Raise for Troops, Pay Freeze for Some Officers

The House on Thursday passed a $585 billion Defense authorization bill that would give service members a 1 percent pay raise in 2015.

Lawmakers upheld the president’s recommendation to give troops a 1 percent pay boost next year – the same amount they received in 2014 – and slightly less than the 1.8 percent that would take place automatically under the annual cost-of-living adjustment. The Senate is expected to vote on the fiscal 2015 National Defense Authorization Act next week.

The formula for determining service members’ annual pay increase is based on the Bureau of Labor Statistics’ Employment Cost Index and the growth in private-sector wages. But under the law (Title 37, Chapter 19, Section 1009) the president has the authority to set an alternate pay raise for military personnel, citing a national emergency or fiscal concerns, if Congress doesn’t pass legislation adjusting the amount or canceling it. The fiscal 2015 NDAA remains silent on the pay raise, which paves the way for Obama’s 1 percent recommendation. Obama recommended a 1 percent raise for both service members and civilian federal employees in 2015.

The 1,648-page bill also calls for a pay freeze for general and flag officers in fiscal 2015, as recommended by the Obama administration. The non-partisan Congressional Budget Office estimated that a 1 percent pay raise for most troops combined with the pay freeze for some officers in the Senate bill would save $588 million in 2015 and $3.9 billion between 2015 and 2019. 

Members of Congress also chose to move slowly on reforming other forms of compensation. The legislation includes provisions that result in a smaller increase for troops’ basic housing allowance and a limited, $3 increase in certain pharmacy co-payments but no increase in mail-order generic drug co-pays. As for changes to troops’ basic housing allowance, lawmakers settled on a 1 percent decrease, rejecting the Pentagon’s request for a 5 percent reduction. The bill postpones any further increases until the Military Compensation and Retirement Modernization Commission releases its recommendations on pay and benefits reform, which is expected in February.

Committee members hammered out some differences between the House and Senate versions of the bill – which the House passed in May. The Senate Armed Services Committee reported out its version in May but the full Senate never voted on it.

The two committees released summaries of the Defense authorization legislation on Tuesday. Here are some other provisions that relate to pay and benefits:

• Military pensions: Those who first join the military before Jan. 1, 2016 would be exempt from reduced cost-of-living adjustments that apply to military retired pay under the bill. The current law grandfathers in those who joined the military before Jan. 1, 2014. Congress in February repealed a provision in the 2013 Bipartisan Budget Act that cut the pensions of working-age military retirees until they reach the age of 62. 
• Rehiring retirees: A measure in the NDAA would extend for another five years agencies’ authority to rehire federal retirees without reducing their salaries by the amount of their pensions – what’s known as a salary offset. Before Congress granted the authority in 2009, agencies rehiring annuitants had to request salary offset waivers on a case-by-case basis from the Office of Personnel Management. “This authority allows agencies to mitigate the loss of institutional memory caused by departing employees,” said National Active and Retired Federal Employees Association President Richard Thissen in a statement. “It helps ensure the government can function effectively while also filling critical gaps and providing training for the next generation of federal managers and employees. In its five years of use, the waiver authority has proven to be a valuable tool for agency leaders.”
• Military commissaries: The legislation rejected the administration’s proposal to cut money for military commissaries, the heavily-subsidized stores on base where service members and their families buy food and other goods. The bill requires the Defense Department to consult with retail grocery experts to find savings in the commissary system.
• TRICARE and mothers: A provision based on a stand-alone bill introduced by Rep. Lois Capps, D-Calif., in April requires the military’s health care system to provide breastfeeding support, supplies and counseling for women during pregnancy and after birth.
• Military spouse employment: The bill directs the Defense secretary to do a report evaluating the progress of the Military Spouse Employment Program in reducing military spouse unemployment, reducing the pay gap between military spouses and their civilian counterparts and addressing the underemployment of military spouses.

Some lawmakers complained on the House floor Thursday about the lack of time to fully debate the massive legislation, particularly since it authorizes Defense to train and equip Syrian rebels to fight the terrorist group ISIS.

“At this point, there is no way that we can resolve disputes about which amendments should be debated, debate them, overcome potential filibusters, and still get the job done,” said Senate Armed Services Committee Chairman Carl Levin, D-Mich., and Ranking Member James Inhofe, R-Okla., in a Dec. 2 joint statement. “If we get nothing enacted, we would kill both the bill itself and the amendments that we’ve cleared, while providing no avenue for getting additional amendments enacted. We ask our colleagues to support us in bringing up and passing this bill without amendment as the best of a bad set of options.”