House may add concurrent receipt to tax bill - Army News | News from Afghanistan & Iraq - Army Times

House may add concurrent receipt to tax bill

House Democrats are considering adding concurrent receipt payments for military retirees to a tax extension bill — a move that could solve funding problems but raise other new issues as well.

The main purpose of HR 4213, the bill that could carry the retiree benefit, is to extend several provisions of tax law that have expired or were extended only temporarily by earlier legislation.

Passage of the bill has been in doubt because of growing opposition to the idea of approving tax breaks without a plan for how to pay for them.

Rather than cutting other federal spending to pay for $50 billion to $55 billion in tax extensions, House Democrats are toying with the idea of adding a $170 billion package of popular legislation to the bill, including expanded unemployment benefits and increases in Medicare payments to doctors.

They also are now talking about adding $5.4 billion to expand concurrent receipt, believing this could get votes for the package while also avoiding funding restrictions, according to aides working on the bill.

More than 300 cosponsors in the House of Representatives support continuing the phased elimination of a more than 100-year-old government policy of reducing military retired pay for those who also receive veterans disability compensation for the same period of service.

It is unclear if adding concurrent receipt to the bill would garner stronger support for the overall legislation, since it would swell the price tag even further.

“This is not a done deal,” one aide stressed, noting that details on the package keep changing as House leaders look for the right mix of provisions to get the measure approved.

Lawmakers are working on a short deadline because some of the programs to be extended, such as unemployment benefits, expire at the end of May.

The concurrent receipt proposal, endorsed by the Obama administration and included in the 2010 and 2011 defense budget requests submitted to Congress, begins with allowing veterans who are medically retired with fewer than 20 years of service to concurrently receive their full military disability retired pay and veterans disability compensation.

Over three years, concurrent receipt would be phased in for these medically retired veterans, often called Chapter 61 retirees for the section of law governing disability retirement for service-connected causes.

In the first year, only those with disabilities rated at 90 percent or higher — about 12,000 people — would be affected.

In the fourth and fifth year of the five-year plan, remaining veterans whose retired pay is offset by their veterans’ compensation would be allowed to receive both benefits in full.

Last year and again this year, Congress was unable to act on the White House proposal because of congressional rules for the annual defense budget that make it difficult to increase one retirement benefit without cutting another.

Putting the concurrent receipt expansion on the tax-extender bill does not mean lawmakers will actually pay for it. Instead, they appear prepared to invoke emergency budget procedures on the bill so they do not have to pay for the Medicare reimbursement increases, and would use the same emergency procedure to also avoid paying the $5.4 billion for concurrent receipt, according to aides working on the package.

House Speaker Nancy Pelosi, D-Calif., indicated last week in a meeting with military and veterans groups that efforts were being made to get concurrent receipt legislation approved.

Pelosi told the groups that two key Democrats, House Budget Committee Chairman John Spratt of South Carolina and House Armed Services Committee Chairman Ike Skelton of Missouri, were working on a solution, according to people who attended the meeting.

“It was not a promise, but a statement that they were working on it and hoped to announce something soon,” said Mike Hayden of the Military Officers Association of America.