Restore Veterans’ Compensation Act of 2020

I 116TH CONGRESS 2D SESSION H. R. 6027 To amend title 10, United States Code, to eliminate the recoupment of separation pay, special separation benefits, and voluntary separation in- centive payments from members of the Armed Forces who subsequently receive disability compensation under laws administered by the Depart- ment of Veterans Affairs and to impose limitations on the authority of the Secretary of Defense to recoup such pay from members who subsequently receive military retired or retainer pay. IN THE HOUSE OF REPRESENTATIVES FEBRUARY 28, 2020 Mr. GALLEGO (for himself, Mr. DESAULNIER, Mr. THOMPSON of California, and Ms. JACKSON LEE) introduced the following bill; which was referred to the Committee on Armed Services, and in addition to the Committee on Veterans’ Affairs, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned A BILL To amend title 10, United States Code, to eliminate the recoupment of separation pay, special separation benefits, and voluntary separation incentive payments from mem- bers of the Armed Forces who subsequently receive dis- ability compensation under laws administered by the De- partment of Veterans Affairs and to impose limitations on the authority of the Secretary of Defense to recoup such pay from members who subsequently receive mili- tary retired or retainer pay. VerDate Sep 11 2014 23:27 Mar 03, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6652 E:\BILLS\H6027.IH H6027 pamtmann on DSKBC07HB2PROD with BILLS 2 •HR 6027 IH Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Restore Veterans’ 4 Compensation Act of 2020’’. 5 SEC. 2. RECOUPMENT OF SEPARATION PAY, SPECIAL SEPA- 6 RATION BENEFITS, VOLUNTARY SEPARATION 7 INCENTIVE, AND VOLUNTARY SEPARATION 8 PAY AND BENEFITS FROM MEMBERS OF THE 9 ARMED FORCES. 10 (a) SEPARATION PAY UPON INVOLUNTARY DIS- 11 CHARGE OR RELEASE FROM ACTIVE DUTY AND SPECIAL 12 SEPARATION BENEFITS.— 13 (1) ELIMINATION OF RECOUPMENT FROM MEM- 14 BERS RECEIVING VETERANS DISABILITY COMPENSA- 15 TION.—Paragraph (2) of section 1174(h) of title 10, 16 United States Code, is amended to read as follows: 17 ‘‘(2)(A) A member who has received separation pay 18 under this section, or severance pay or readjustment pay 19 under any other provision of law, based on service in the 20 armed forces shall not be deprived, by reason of the receipt 21 of such separation pay, severance pay, or readjustment 22 pay, of any disability compensation to which the member 23 is entitled under the laws administered by the Department 24 of Veterans Affairs. 25 VerDate Sep 11 2014 23:27 Mar 03, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H6027.IH H6027 pamtmann on DSKBC07HB2PROD with BILLS 3 •HR 6027 IH ‘‘(B) The amount of disability compensation to which 1 a member may be entitled under the laws administered 2 by the Department of Veterans Affairs may not be re- 3 duced on account of the receipt of separation pay, sever- 4 ance pay, or readjustment pay.’’. 5 (2) RECOUPMENT FROM MEMBERS RECEIVING 6 RETIRED OR RETAINER PAY LIMITED TO NET 7 AMOUNT OF SEPARATION PAY.—Section 1174(h)(1) 8 of title 10, United States Code, is amended by in- 9 serting before the period at the end the following: ‘‘, 10 less the amount of Federal income tax withheld from 11 the separation pay, severance pay, or readjustment 12 pay (such withholding being at the flat withholding 13 rate for Federal income tax withholding, as in effect 14 pursuant to regulations prescribed under chapter 24 15 of the Internal Revenue Code of 1986)’’. 16 (3) PERCENTAGE LIMITATIONS ON 17 RECOUPMENT FROM MEMBERS RECEIVING RETIRED 18 OR RETAINER PAY AND RECOUPMENT PROCESS.— 19 Section 1174(h)(1) of title 10, United States Code, 20 as amended by paragraph (2), is further amended— 21 (A) by inserting ‘‘(A)’’ after ‘‘(1)’’; 22 (B) by striking ‘‘shall specify, taking into 23 account the financial ability of the member to 24 pay and avoiding the imposition of undue finan- 25 VerDate Sep 11 2014 23:27 Mar 03, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H6027.IH H6027 pamtmann on DSKBC07HB2PROD with BILLS 4 •HR 6027 IH cial hardship on the member and member’s de- 1 pendents,’’ and inserting ‘‘(subject to subpara- 2 graph (B)) shall specify’’; and 3 (C) by adding at the end the following new 4 subparagraphs: 5 ‘‘(B) The amount deducted under subparagraph (A) 6 from a payment of retired or retainer pay may not exceed 7 25 percent of the amount of the member’s retired or re- 8 tainer pay for that month unless the member requests de- 9 ductions at an accelerated rate. The Secretary of Defense 10 shall consult with the member regarding the repayment 11 rate to be imposed, taking into account the financial abil- 12 ity of the member to pay and avoiding the imposition of 13 an undue hardship on the member and the member’s de- 14 pendents. 15 ‘‘(C) The deduction of amounts from the retired or 16 retainer pay of a member under this paragraph may not 17 commence until the date that is 90 days after the date 18 on which the Secretary of Defense notifies the member 19 of the deduction of such amounts under this paragraph. 20 Any notice under this subparagraph shall be designed to 21 provide clear and comprehensive information on the de- 22 duction of amounts under this paragraph, including infor- 23 mation on the determination of the amount and period of 24 installments under this paragraph. 25 VerDate Sep 11 2014 23:27 Mar 03, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H6027.IH H6027 pamtmann on DSKBC07HB2PROD with BILLS 5 •HR 6027 IH ‘‘(D) The Secretary of Defense may waive the deduc- 1 tion of amounts from the retired or retainer pay of a mem- 2 ber under this paragraph if the Secretary determines that 3 deduction of such amounts would result in a financial 4 hardship for the member.’’. 5 (b) CONFORMING AMENDMENTS.— 6 (1) VOLUNTARY SEPARATION INCENTIVE.—Sec- 7 tion 1175(e) of title 10, United States Code, is 8 amended— 9 (A) in paragraph (3)(A)— 10 (i) by striking the first sentence and 11 inserting the following new sentence: ‘‘Sub- 12 section (h) of section 1174 of this title 13 shall apply to any member who has re- 14 ceived the voluntary separation incentive 15 and who later qualifies for retired or re- 16 tainer pay under this title or for disability 17 compensation under the laws administered 18 by the Department of Veterans Affairs.’’; 19 and 20 (ii) in the second sentence, by striking 21 ‘‘the deduction required under the pre- 22 ceding sentence’’ and inserting ‘‘the deduc- 23 tion from the member’s retired or retainer 24 pay’’; and 25 VerDate Sep 11 2014 23:27 Mar 03, 2020 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H6027.IH H6027 pamtmann on DSKBC07HB2PROD with BILLS 6 •HR 6027 IH (B) by striking paragraph (4) and redesig- 1 nating paragraph (5) as paragraph (4). 2 (2) VOLUNTARY SEPARATION PAY AND BENE- 3 FITS.—Subsection (h) of section 1175a of title 10, 4 United States Code, is amended to read as follows: 5 ‘‘(h) COORDINATION WITH RETIRED OR RETAINER 6 PAY AND DISABILITY COMPENSATION.—(1) Subsection 7 (h) of section 1174 of this title shall apply to any member 8 who receives voluntary separation pay under this section 9 and who later qualifies for retired or retainer pay under 10 this title or title 14 or for disability compensation under 11 the laws administered by the Department of Veterans Af- 12 fairs. 13 ‘‘(2) No deduction shall be made from the disability 14 compensation paid to an eligible disabled uniformed serv- 15 ices retiree under section 1413, or to an eligible combat- 16 related disabled uniformed services retiree under section 17 1413a of this title, who is paid voluntary separation pay 18 under this section. 19 ‘‘(3) The requirement under this subsection to repay 20 voluntary separation pay following retirement from the 21 armed forces does not apply to a member who was eligible 22 to retire at the time the member applied and was accepted 23 for voluntary separation pay and benefits under this sec- 24 tion.’’. 25 VerDate Sep 11 2014 23:27 Mar 03, 2020 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H6027.IH H6027 pamtmann on DSKBC07HB2PROD with BILLS 7 •HR 6027 IH (c) EFFECTIVE DATE AND APPLICATION OF AMEND- 1 MENTS.—The amendments made by this section shall take 2 effect on the first day of the first month beginning on or 3 after the date of the enactment of this Act. In the case 4 of deductions to be made from the retired or retainer pay 5 of members of the uniformed services, the amendments 6 shall apply to that month and subsequent months. 7 Æ VerDate Sep 11 2014 23:27 Mar 03, 2020 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6301 E:\BILLS\H6027.IH H6027 pamtmann on DSKBC07HB2PROD with BILLS