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Witness Testimony of Hon. Patrick J. Murphy, a Representative in Congress from the State of Pennsylvania

First, I would like to thank Chairwoman Herseth Sandlin and Ranking Member Boozman for holding this hearing and giving me the opportunity to speak on behalf of my bill, H.R. 3298, the 21st Century Servicemembers Protection Act. 

Soon after my election to Congress, a JAG attorney who does legal assistance in the 101st Airborne contacted me to let me know about a growing problem that many deployed servicemembers are currently facing.

He explained to me that many of the soldiers he worked with have had their credit reports damaged during their deployments over issues concerning their contracts with cellular telephone or internet service providers.  This JAG attorney was able to put one of his own contracts on hold during his deployment, but to do so he was forced to pay a costly fee.

Looking into this further, I also discovered that some financial institutions were slow or unwilling to reduce servicemembers’ interest rates during their deployments, even though these creditors are already required to do so by law.

I learned that when servicemembers and their families ran into problems with service providers and creditors, they not only had to deal with the strain of deployment, but also faced repeated harassment by collection agencies.

We owe the men and women of our Armed Forces better than this.

For decades, the Soldiers and Sailors Civil Relief Act and its successor, the Servicemembers Civil Relief Act (SCRA) have provided crucial financial protection for our Soldiers, Sailors, Airmen, Marines, and Guardsmen.  Now, as we continue to send a new generation of servicemembers into harm's way, it is our obligation as members of Congress to update and modernize SCRA for today's troops. 

The 21st Century Servicemembers Protection Act expands SCRA to cover service contracts such as cellular phones, utilities, cable television, or internet access.  Similar to provisions that currently exist for residential and automobile leases, this legislation will allow troops with deployment orders to more easily terminate or suspend their service contracts without fee or penalty.

Currently, creditors who knowingly or negligently fail to reduce interest rates upon notification from a soldier with deployment orders, face no specific penalty.   Another provision of my bill would add a penalty to those creditors who refuse to reduce interest rates as they are already required to do under SCRA.

As a veteran of the United States Army and the war in Iraq, I know how important it is that our troops be able to focus on accomplishing their mission and coming home safely, without worrying about their credit rating or whether bill collectors are harassing their families. 

Since this bill’s introduction, my staff and I have worked with the industries that will be affected by this legislation.  In doing so, we have developed compromise language that I believe maintains the intent of the bill as introduced while alleviating the concerns of the companies that will be affected by passage of this legislation.  It is my hope that the Committee will adopt this revised language when the bill moves to mark-up.

This is not a Democratic or Republican issue.  This is about doing what’s right for our troops.  With that, I would again like to thank the Chairwoman and the Ranking Member for giving me the opportunity to testify today, and I am happy to answer any questions.


Fleet Reserve Association
Alexandria, VA.
22 August 2007

The Honorable Patrick Murphy
U.S. House of Representatives
1007 Longworth Office Building
Washington, DC 20515

Fax: 202-225-9511

Dear Representative Murphy:

The Fleet Reserve Association strongly supports, “The Twenty-First Century Service Members Protection Act” (H.R. 3298) to expand current credit protections for service members to terminate or suspend certain service contracts entered into before the individual receives notice of a permanent change of station or deployment orders.

Under current law, only residential leases (90 days or more) and vehicle leases (180 days or more) can be canceled. Your proposal expands these protections to include other services such as cell phone service, cable/satellite television, Internet service, auto insurance and utility payments. In cases of fees paid in advance, a company would have 30 days from the effective date of termination to provide a refund.

The bill also increases the potential penalty for companies that do not provide interest rate reduction to those eligible under the Service Members Civil Relief Act, which mandates a six percent rate cap on loans incurred prior to the service member coming on active duty.

The Association appreciates your leadership on this legislation and stands ready to assist you in its passage in the 110th Congress. The FRA point of contact is John Davis, FRA’s Director of Legislative Programs at the above numbers or (john@fra.org).

Sincerely,

JOSEPH L. BARNES
National Executive Secretary

JLB:jrd:aal


Association of the United States Army
Arlington, VA
12 September 2007

The Honorable Patrick Murphy
House of Representatives
1007 Longworth Office Building
Washington, DC 20515

Dear Mr. Murphy:

On behalf of the 105,000 members of the Association of the United States Army, I write to express our support for your legislation, the 21st Century Servicemembers Protection Act, H.R. 3298.

The Association of the United States Army strongly believes that military members called to defend our great nation should not be penalized by steep termination fees in contracts involving cellular phone service, car insurance, utilities, cable television, or internet access.  Also, we appreciate your recognition of the fact that serious penalties are warranted for unscrupulous lenders who knowingly fail to reduce interest rates for deploying servicemembers.

The Association of the United States Army applauds and supports your efforts to provide greater protections for military members and their families.  We look forward to working with you to secure enactment of this legislation.

Sincerely,

GORDON R. SULLIVAN
General, USA Retired

GRS/WBL/rmw


Veterans of Foreign Wars of the United States
Washington, DC.
November 15, 2007

The Honorable Patrick Murphy
1007 Longworth House Office Building
US House of Representative
Washington, DC 20515

Dear Representative Murphy"

On behalf of the 2.4 million members of the Veterans of Foreign Wars and our Auxiliaries, I'd like to offer our support for H.R. 3298, legislation that would expand the Servicemembers Civil Relief Act (SCRA) to cover service contracts such as cellular phone service, car insurance, utilities,  cable television, or internet access. This legislation would allow troops with deployment orders to terminate or suspend their service contracts without fee or penalty.

This important legislation would also create a penalty of up to $10,000 for creditors who refuse to reduce interest rates as required by SCRA. As of currently, there is no penalty for creditors that choose not to adhere to SCRA; this legislation would ensure our service members being sent into harm's way are taken care of.

The VFW commends you for introducing this legislation and we look forward to working with you and your staff to ensure its success. Thank you for your continued support of all America's veterans. Also, thank you for your service in the 82nd Airborne.

Sincerely,

Dennis Cullinan, Director
National Legislative Service


Military Officers Association of America
Alexandria, VA.
August 30, 2007

The Honorable Patrick Murphy
The Honorable Tim Walz
United States House of Representatives
Washington, DC  20515

Dear Representatives Murphy and Walz:

On behalf of the nearly 367,000 members of the Military Officers Association of America (MOAA), I am writing to express our support for your legislation, the 21st Century Service members Protection Act, H.R. 3298.

MOAA strongly believes that military members called to defend our great nation should not be penalized by steep termination fees in contracts involving cellular phone service, car insurance, utilities, cable television. or internet access. Also, we appreciate your recognition of the fact that serious penalties are warranted for unscrupulous lenders who knowingly fail to reduce interest rates for deploying servicemembers.

We would recommend further review of potential unintended consequences in the lease termination provisions in the bill. In many states a landlord would be required to hold and protect for a specified period personal property of a deployed service member who has terminated a lease. This requirement is intended to protect tenants from retaliation. However, the bill would apparently result in criminal penalties for holding tenants' property that may be in their interest.

MOAA applauds and supports your efforts to provide greater protections for military members and their families. We look forward to working with you to secure enactment of this legislation.

Sincerely,

VADM Norbert R. Ryan, Jr. USN (Ret.)
President


National Guard Association of the United States, Inc.
Washington, DC.
September 10, 2007

The Honorable Patrick Murphy
1007 Longworth House Office Building
Washington, DC  20515

Dear Mr. Murphy:

As a vital part of our nation's Armed Forces, National Guard members continue to perform their federal active duty mission with distinction but not without risks to their legal interests at home.

While serving on active duty, National Guard members requires full protection of their civil legal interests and, where appropriate, relief from performing certain contractual obligations adversely affected by their active duty service.

NGAUS strongly supports HR. 3298 now before the 110th Congress which seeks to expand the protections available to National Guard members under the Servicemembers Civil Relief Act with respect to terminating or suspending contracts for cellular phone service, cable or satellite television service, internet service, automobile insurance, water, electricity, oil, gas, telephone and other utilities.

Our young men and women, who are selflessly serving our states and nation, deserve the protections they need to obtain relief from contractual obligations for services that they will not require during deployment .

NGAUS thanks you for your continued support of the National Guard.

Sincerely,

Stephen M. Koper
Brigadier General, USAF, (ret)
President