Chairwoman Herseth Sandlin, Ranking Member Boozman and members of the Subcommittee on Economic Opportunity, I am pleased to appear before you today on behalf of the Department of Veterans Affairs (DVA) Secretary’s Veterans Advisory Committee on Education (VACOE) to provide the Committee’s views on the current state of the MGIB-AD and MGIB-SR; recommendations to update the MGIB; and possible legislative action that should be considered by the Subcommittee
State of MGIB-AD-SR
Seamless Transition Program Flexibility and Claims Processing
It is the Advisory Committee’s (VACOE) view that program flexibility and efficient claims processing are the keys to a veteran’s seamless transition of providing earned education benefits to eligible participants. It should also be noted that in the past the Committee made a number of recommendations designed to increase program flexibility, i.e. accelerated payment without restriction, expansion of test reimbursement, removing or extending the delimiting date, equalizing the benefit for OJT/Apprentice programs in relation to IHL and NCD education/training programs, and removing restrictions on wage progression for municipal employees.
The reason seamless transition is difficult to accomplish is that when the Montgomery GI Bill was created by legislation in 1984, it was both similar and different from previous GI Bills. It was similar in that it provided a benefit for veterans who chose to enroll in an educational program at an approved education or training institution. Like the previous programs the maximum benefit was payable to veterans training full-time, with prorated amounts available for veterans training three-quarters time, half time, or less than half time. The level of benefits also depended on whether a veteran was attending a traditional degree-granting institution or was enrolled in on-the-job training, apprenticeship, or cooperative training programs. It was different because previous Education Programs (EP), special rules provided higher benefit levels for persons having eligibility for the prior Vietnam-era EP, with lower benefits authorized for persons enlisting for a period of less than three years. Another unique feature of the Montgomery GI Bill (MGIB) was that it authorized benefits for those in the Selected Reserve (Chapter 1606 program), although the maximum monthly benefit was much lower than the Active Duty rate. Additionally, the MGIB authorized "kickers", or additional monthly benefits for certain veterans in certain military occupations and "buy-ups" for veterans seeking higher monthly benefits.
In addition to the aforementioned features which add substantial complexity to eligibility and payment amount determinations, other provisions made the MGIB more complicated than previous EPs. The inadequacies of EPs which preceded the MGIB led to legislation authorizing persons eligible for earlier EPs to choose to become eligible for the MGIB. Special "top-off" tuition assistance benefits and "accelerated" or licensing and certification benefits were also authorized. Most recently, a new "Chapter 1607" EP was created for "Reserve Component Members Supporting Contingency Operations and Certain Other Operations". The eligibility rules and benefit rates for these servicemembers are different than those for persons who enlist for two or three years in the Active-Duty program or who enlist in the regular Selected Reserve.
To further compound the issue, the adoption of the Total Force structure, made the reserve/guard an integral part of the active duty force. Hence, some veterans became eligible for multiple programs i.e Chapter 1606, 1607 and 30.
Congress, although well meaning, tends to create new initiatives designed to shore up existing deficiencies in the current MGIB; without dealing with the administrative problems inherent in trying to integrate new program components in the established MGIB. As a result of the proliferation of eligibility categories and benefit levels fewer educational claims are straightforward. The complexities of a number of new GI Bill opportunities have resulted in a cumbersome data management system that does not timely respond to the needs of veterans and other GI Bill eligible recipients.
The existing array of supplemental GI Bill programs, coupled with multiple program eligibility, suggest a strong need for a comprehensive GI Bill program as outlined in the VACOE letter to the Secretary on July 8, 2005 entitled Total Force GI Bill.
It is the Committee’s belief that the DVA Education Service, in conjunction with Congress, can create an effective, efficient claims processing system by adopting the following:
- Restructure the GI Bill; i.e., Total Force, thus streamline claims processing.
- Create a synergistic relationship with Congress in order to ensure feasibility and support for any additional programs associated with the GI Bill
- Improve information exchange between DoD and DVA. The need for constant communication between DoD and DVA would be minimal with restructure of GI Bill.
- Invest in state-of-the-art IT systems
- Hire additional staff to do claims processing or at a minimum maintain budget direct FTEs
The Advisory Committee, after nearly two years of studying the Montgomery GI Bill (MGIB), recommended a fundamental change to the structure of the MGIB; and also put forth the framework for a new GI Bill that reflects the realities of the Total Force policy.
It is the Committee’s belief that this restructuring is necessary to incorporate program flexibility, ease of administration and equity of service rendered.
Both the Active Duty and Selected Reserve (SelRes) programs share the same name and are part of the same legislation, but they have different purposes. The Active Duty (AD) program revolves around recruitment and transition/readjustment to civilian status while the SelRes program is designed to promote recruitment and retention, with no regard for readjustment or transition.
The current GI Bill programs did not consider DoD’s use of the SelRes for all operational missions. Under this policy the SelRes and some members of the Individual Ready Reserve (IRR) are considered integral members of the Total Force. Reserve members who are faced with extended activations require similar transition and readjustment benefits as those available to separating AD service men and women. Although the new reserve GI Bill educational benefits program authorized under Chapter 1607 of Title 10, U.S. Code attempts to address this issue, it remains primarily a retention tool, requiring continued reserve service.
For these reasons we recommend replacing the separate GI Bill programs for veterans and reservists with one program that consolidates all GI Bill programs under one umbrella (Title 38, Code). This would include enrolling all currently eligible personnel in Chapters 30, 1606 and 1607 in the new Total Force GI Bill. This approach will add value to the Montgomery GI Bill (MGIB) as a recruitment and retention tool for the Armed Forces, including National Guard and Reserve; establish equity of benefits for returning Guard and Reserve members; support Congress’ intent for the MGIB (see Attachment C); and potentially save taxpayer money through improved administration.
In the twenty years since the Montgomery GI Bill went into effect on June 30, 1985 the nation’s security environment has changed radically from a fixed cold war to a dynamic “Global War on Terror.” In 1991 the Active Duty Force (AF) of the Military stood at 2.1 million; today it stands at 1.4 million.
Since 9/11 more than 480,000 members of the 860,000 Selected Reserve (SelRes) have been activated. Today approximately 40% of troops in are Guardsmen or Reservists.
Despite this, the Montgomery GI Bill (MGIB) and the Montgomery GI Bill—Selected Reserve (MGIB—SR) still reflect the situation that existed in 1984. Then the members of the Selected Reserve rarely served on active duty. The idea that any projection of power would require the activation of at least some reservists was never considered in creating these programs.
Because most reservists have both careers and families which are embedded in towns and cities across the country, these activated citizen-soldiers -- mayors, police chiefs, firefighters, and small business owners -- face additional burdens as financial and career obligations mount, while their families, employers, and communities frequently face significant sacrifices and hardships as well.
This has led to inequitable situations. First, Selected Reserve members and members of the Individual Ready Reserve (IRR) may be called to active duty for considerable periods, but less than two years. When they return to civilian life, what is available to help them readjust? They have nothing at all if their active duty is at the end of their six-year commitment to the Selected Reserves.
Proposed Total Force GI Bill
In the face of these dramatic changes in the nature of Reserve Force (RF) usage, and recognizing that the Active and Reserve Forces have become inextricably integrated as a Total Force, the Committee is proposing an updated GI Bill which accepts the new security realities of the open-ended Global War on Terror, the recruiting and retention issues which arise from it, and the expanded role that the RF plays in this modern era. The current members of the RF are being asked to perform in a manner literally unprecedented since WWII.
As the distinctions between the active and reserve force continue to diminish the difference in treatment between the active and reserve forces in the GI Bill should decline accordingly. Benefits need to remain commensurate with sacrifice/service.
From 1985 through 1990, a period of relative quiescence for the RF, Reservists, under Chapter 1606 of Title 10 USC, were receiving 47% of the educational benefit of active force Montgomery GI Bill participants. That 47% rate remained in effect until roughly the turn of this century when the MGIB was significantly enhanced for the Active Force.
Since 1990 the percentage of educational benefit for reservists has declined from 47% to 29 % of the active force educational benefit, and this decline took place during a period when the involuntary mobilization of reservists had begun to accelerate significantly.
VACOE has focused on consolidating veterans’ education benefit programs into a single Total Force structure placing them in the department where veterans advocacy is the first priority and ensuring that a fair framework for providing benefits commensurate with the nature of military service is established and maintained.
The architecture of any future GI Bill is very important. Shifting funding out of Title 10 and placing responsibility for all GI Bill administration in the proper cabinet department (DVA) is the key of any future efforts to improve the administration and the fundamental fairness of the GI Bill.
This concept would provide MGIB reimbursement rate levels based on an individual’s service in the Armed Forces, including the National Guard and Reserve: a MGIB active duty three-year rate, a pro rata SelRes rate, and a SelRes activated rate which is equivalent to the active duty rate on a month-to-month basis after 90 days service.
See Attachment A for additional detail concerning the proposed Bill.
Chapters 35 and 31 remain as before.
Benefits of New GI Bill
We anticipate a number of positive effects from this new GI Bill:
* The additional educational benefit for active duty service provides a necessary one-to-one equity for arduous time served by individuals in uniform whether AF or RF.
* Under the current Chapter 1606, reservists have 14 years from the beginning date of eligibility to use their benefits in service. As a result many reservists reach the delimiting date while they are still serving in the Selected Reserve. A provision in the proposal would extend the time frame during which reservists could utilize the education benefit.
* A provision allowing reservists ten (10) years from the last active/activated duty to utilize their educational benefit adds a transition and readjustment element to the traditional recruiting and retention elements of the Reserve Component of the GI Bill. This is precisely what is now needed since the extended arduous duty of the reservist requires transition and readjustment very similar to active forces.
* Placing the Total Force GI Bill within Title 38 USC will simplify the administration of GI educational benefit for all members of the ArmedServices both AF and RF, and ensure all future benefits are upgraded equitably. (See Attachment B)
* The GI Bill also has traditionally been viewed as a grateful nation’s way of showing its appreciation for the sacrifices of service, separation, and combat. The new GI Bill reflects the new realities which have transformed this nation’s security environment since the second week of September ’01.
No amount of skill compensates for a lack of manpower. In order to continue to deter actual and potential adversaries now and in the future, we must continue to attract the finest among the willing and capable. It is imperative that the forces continue to attract and retain high quality men and women to assure the nation’s collective security.
The famed risk-reward ratio follows the same natural calculus as the supply and demand curve. No one in this country can honestly say that the risks for our reservists have not increased of late. This proposed Total Force GI Bill seeks to address at least part of the reward scheme for those reservists who are being asked to risk the most.
During a period when a significant portion of those who sign up for duty, whether in the active force or in the reserve force, say that they do so, specifically, for the educational benefits, it is important to boost recruitment as much as possible by means of this proven approach.
By allowing Reserve Force (RF) retirees to utilize the benefit for ten (10) years following retirement, we are both boosting retention as well as rewarding the rigors of activation and mobilization.
Because the reserve component has come to more closely resemble the active component, it is time that the educational benefits for the reserve component come to more closely resemble those of the active component. That, in short, is what our proposal, the Total Force GI Bill, seeks to do.
If implemented, we envision wins for the individual Selected Reservist, a win for the Armed Services, and a win for our national security.
Summary of Differences
|Current MGIB||Total Force GI Bill|
|Different Title||One title|
|Confusing Straight Forward|
|Multiple Committees||Half the Committees|
|Costly redundancies||Savings through Efficiencies|
|Different Benefits for same Risks||Same benefit for same Risks|
|Delimiting date inequities||Fair delimiting dates|
|Modest retention incentive||Increased retention incentive|
|No SelRes readjustment benefit||SelRes Readjustment benefit|
|Differing Rules for Recruiters||Same Rules for all Recruiters|
|Inequitable Upgrades||Equitable Upgrades|
|Recipients confused||Simplified for Recipients|
|Staff Training Complexities||Staff Training Simplified|
This Total Force proposal provides a unique opportunity to create a comprehensive GI Bill that is both fair and simple. Its eloquence is its equity and simplicity.
The question always raised by Congress when considering the GI Bill is can we afford it. Well, I don’t think we can afford not to.
A Total Force GI Bill
This Bill would provide MGIB reimbursement rate levels based on an individual’s service in the Armed Forces, including the National Guard and Reserve.
1. The first tier -- similar to the current
Montgomery GI Bill -- Active Duty (MGIB-AD) 3-year rate -- would be provided to all who enlist for active duty. Service entrants would receive 36 months of benefits at the AD Rate.
2. The second tier or level would be for all who enlist or re-enlist in the SelRes for 6 years, and this would entitle them to 36 months of benefits at a pro-rata amount of the active duty rate, (the suggested rate is 35% of the MGIB-AD rate).
3. The third tier would be for members of the SelRes/IRR who are activated for at least 90 days. They would receive one month of benefit for each month of activation, up to a total of 36 months, at the active duty rate. The intent is to provide the same level of benefit as the active duty rate for the same level of service.
3a. These months of full benefits would replace, month-for-month, any SelRes entitlements at the second tier.
3b. The maximum benefit a member of the SelRes could receive under this program would be the equivalent of 36 months at the active duty rate.
An individual would have up to 10 years to use the active duty or activated-service benefit from their last date of active/activated duty or reserve service, whichever is later. A Selected Reservist could use remaining second tier MGIB benefits as long as he/she were satisfactorily participating in the SelRes, and for up to 10 years following separation from the reserves, in the case of separation for disability or qualification for a reserve retirement at age 60.
All provisions (e.g. additional contributions), and programs (e.g. accelerated payment, approved test reimbursement, etc.) eligible for payment under the current MGIB-AD would be available under all three levels.
Under this plan DoD would continue to be able to provide Recruitment and Retention incentives such as loan repayment, kickers-college fund, and enlistment bonuses.
Total Force GI Bill Program
The following improvements would accrue to GI Bill program administration by adopting the new Total Force GI Bill:
- The MGIB and the MGIB-SR do not pay for the same training although there is no logical reason why they shouldn’t. This is the result of having funding of MGIB—SR the responsibility of DoD, while the funding of basic MGIB is VA’s responsibility. Thus, bills affecting MGIB—SR are referred to the Senate and House Armed Services Committees (SASC and HASC) while bills affecting MGIB are referred to the House and Senate Veterans Affairs Committees (HVAC and SVAC).
- These problems could be addressed by replacing the separate GI Bill programs (Chapters 30, 1606 and 1607) with one consolidated program under Title 38, US Code. This new bill would have a continuum of benefits that matched the continuum of possible service.
- It would provide monthly benefits for activated Selected Reservists and reservists from the Individual Ready Reserve with no prior service qualifying for MGIB that is proportionate to their actual active duty.
- It would put funding for the benefits for those in the Selected Reserve with VA.
- It would make the types of training uniform for all in the Armed Forces who would be eligible for this GI Bill.
- One set of rules covering one GI Bill would allow for better understanding of the program by recruiters, beneficiaries, stakeholders and program managers.
- Training new claims examiners and processing claims would be easier and more efficient as there would be one set of rules.
- Systems costs would be lower for the new program as the other systems would no longer be required.
- Since there would be one program and one set of rules, there would not be inconsistent and inequitable structuring of benefit levels.
- VA would be responsible for all basic benefit payments, and would be reimbursed by the agency concerned for any additional payments made through “kickers”. Currently, the selected reserve basic payment is reimbursed to VA and managed either by DoD or DHS. The benefit is that no “basic” award would have to be managed outside of and reimbursed to VA, but the agency concerned would maintain the flexibility to channel critical specialties provided under the current programs.
UNITED STATES CODE
TITLE 38 - VETERANS' BENEFITS
PART III - READJUSTMENT AND RELATED BENEFITS
CHAPTER 30 - ALL-VOLUNTEER FORCE EDUCATIONAL ASSISTANCE PROGRAM
SUBCHAPTER I - PURPOSES; DEFINITIONS
Sec. 3001. Purposes
The purposes of this chapter are—
(1) to provide a new educational assistance program to assist in the readjustment of members of the Armed Forces to civilian life after their separation from military service;
(2) to extend the benefits of a higher education to qualifying men and women who might not otherwise be able to afford such an education;
(3) to provide for vocational readjustment and to restore lost educational opportunities to those service men and women who
served on active duty after June 30, 1985;
(4) to promote and assist the All-Volunteer Force program and the Total Force Concept of the Armed Forces by establishing a new program of educational assistance based upon service on active duty or a combination of service on active duty and in the Selected Reserve (including the National Guard) to aid in the recruitment and retention of highly qualified personnel for both the active and reserve components of the Armed Forces;
(5) to give special emphasis to providing educational assistance benefits to aid in the retention of personnel in the Armed Forces; and
(6) to enhance our Nation's competitiveness through the development of a more highly educated and productive work force.