[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[S. 2791 Introduced in Senate (IS)]







108th CONGRESS
  2d Session
                                S. 2791

  To enhance the benefits and protections for members of the reserve 
 components of the Armed Forces who are called or ordered to extended 
                  active duty, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                           September 10, 2004

 Mr. Daschle (for himself, Mrs. Murray, Ms. Mikulski, Mr. Leahy, Mrs. 
 Lincoln, Mr. Corzine, Mr. Akaka, Mr. Dorgan, Mr. Pryor, Mr. Johnson, 
 and Mr. Reid) introduced the following bill; which was read twice and 
              referred to the Committee on Armed Services

_______________________________________________________________________

                                 A BILL


 
  To enhance the benefits and protections for members of the reserve 
 components of the Armed Forces who are called or ordered to extended 
                  active duty, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``National Guard and Reserve Bill of 
Rights Act of 2004''.

SEC. 2. PERIODS OF DEPLOYMENTS OF RESERVES OVERSEAS.

    (a) United States Central Command Deployments.--
            (1) Limitation.--During a period when there is in effect a 
        policy of assigning units or members of one or more of the 
        active components of the Armed Forces to duty in the area of 
        responsibility of the United States Central Command for a 
        specified period of time of not less than one year, the 
        Secretary of Defense shall provide that the length of such an 
        assignment in the case of members of the reserve components of 
        the Armed Forces may not exceed the length of such period for 
        the corresponding active component reduced by the period of 
        time between the date of entry of the reserve component members 
        onto active duty and the date of the deployment of such members 
        for such assignment.
            (2) Transition.--Paragraph (1) applies to members of 
        reserve components assigned to duty in the area of 
        responsibility of the United States Central Command on or after 
        the date of the enactment of this Act and to such members 
        assigned to such duty before such date who as of the date of 
        the enactment of this Act have more than 90 days remaining in 
        such assignment.
    (b) Communication of Lengths of Deployment Periods to Reserves in 
Operation Iraqi Freedom.--
            (1) Findings.--Congress makes the following findings:
                    (A) Members of all components of the Armed Forces, 
                active and reserve, exhibit a remarkable commitment and 
                willingness to serve their country in Iraq and 
                Afghanistan, and other United States military efforts 
                around the world and, in doing so, frequently face 
                grave risks and difficulties.
                    (B) While the members of the Armed Forces have 
                clearly and consistently demonstrated their dedication 
                to duty, much uncertainty has arisen among them about 
                the lengths of their deployments and when they will be 
                returned to their loved ones. This confusion impairs 
                our troops' morale and places undue strain on their 
                families and their civilian employers.
                    (C) Fairness to the men and women of the Armed 
                Forces deployed overseas requires that the Department 
                of Defense--
                            (i) have clear policies regarding lengths 
                        of deployment periods; and
                            (ii) communicate these policies and other 
                        deployment-related information to them and 
                        their families.
                    (D) While many military units were deployed months 
                before Operation Iraqi Freedom was launched on March 
                19, 2003, the Department of Defense did not announce a 
                policy about the length of deployments until August 
                2003.
                    (E) Even after the Department of Defense issued its 
                so-called ``one year boots-on-the-ground'' policy 
                regarding lengths of deployment periods, many of the 
                members of units deployed overseas in Operation Iraqi 
                Freedom learned shortly before their scheduled return 
                dates that their deployments would be extended for 
                months beyond the one-year period provided under that 
                policy.
            (2) Report.--
                    (A) Requirement for report.--Not later than March 
                1, 2005, the Secretary of Defense shall submit to the 
                Committees on Armed Services of the Senate and the 
                House of Representatives a report on Department of 
                Defense policies governing the length of deployment 
                periods applicable to members of reserve components of 
                the Armed Forces in connection with Operation Iraqi 
                Freedom, and on the communication between the 
                Department of Defense and reserve component personnel 
                and their families regarding the length of the 
                deployment periods.
                    (B) Consultation requirement.--In preparing the 
                report under this section the Secretary shall consult 
                with the Chairman and other members of the Joint Chiefs 
                of Staff and with such other officials as the Secretary 
                considers appropriate.
                    (C) Content.--The report under this paragraph shall 
                contain a discussion of the matters described in 
                subparagraph (A), including the following matters:
                            (i) The process by which the Department of 
                        Defense determined its policy regarding the 
                        length of deployment periods.
                            (ii) The reason that no such policy was in 
                        place before Operation Iraqi Freedom began.
                            (iii) A comparison of the policy during 
                        Operation Iraqi Freedom with Department of 
Defense deployment policies that applied to previous contingency 
operations.
                            (iv) The timeliness of the process for 
                        notifying reserve component units for 
                        activation.
                            (v) The process for communicating with 
                        activated reserve component members and their 
                        families about demobilization schedules.
                            (vi) The family support programs provided 
                        by the National Guard and other reserve 
                        components for families of activated Reserves.
                            (vii) An assessment of lessons learned 
                        about how the increased operations tempo of the 
                        National Guard and other reserve components can 
                        be expected to affect readiness, recruitment 
                        and retention, civilian employers of Reserves, 
                        and equipment and supply resources of the 
                        National Guard and the other reserve 
                        components.
                    (D) Matters for particular emphasis.--In the 
                discussion of the matters included in the report under 
                this subsection, the Secretary of Defense shall place 
                particular emphasis on--
                            (i) lessons learned, including deficiencies 
                        identified; and
                            (ii) near-term and long-term corrective 
                        actions to address the identified deficiencies.
                    (E) Form of report.--The report shall be submitted 
                in unclassified form, but may include a classified 
                annex.

SEC. 3. MILITARY PAY.

    (a) Correction of Pay Problems for Activated Reserve Component 
Personnel.--
            (1) Requirement for senior level action.--The Secretary of 
        the Army shall designate a senior level official of the 
        Department of the Army to implement--
                    (A) the recommendations for executive action set 
                forth in the report of the Comptroller General of the 
                United States entitled ``Military Pay, Army National 
                Guard Personnel Mobilized to Active Duty Experienced 
                Significant Pay Problems'', dated November 2003; and
                    (B) the recommendations for executive action set 
                forth in the report of the Comptroller General of the 
                United States entitled ``Military Pay, Army Reserve 
                Soldiers Mobilized to Active Duty Experienced 
                Significant Pay Problems'', dated August 2004.
            (2) Supervision by comptroller of department of defense.--
        The official designated under paragraph (1) shall report 
        directly to, and be subject to the direction of, the Under 
        Secretary of Defense (Comptroller) regarding performance of the 
        duties that the official is designated to carry out under such 
        paragraph.
            (3) Termination of requirement.--The designation under 
        paragraph (1) shall terminate upon the certification of the 
        Under Secretary of Defense (Comptroller) to Congress that all 
        recommendations referred to in such paragraph have been 
        implemented.
    (b) Reenlistment Bonus for Selected Reserve.--
            (1) Expanded eligibility.--Subsection (a)(1) of section 
        308b of title 37, United States Code, is amended by striking 
        ``14 years'' and inserting ``17 years''.
            (2) Increased maximum amount.--Subsection (b) of such 
        section is amended by striking ``(b) Bonus Amount; Payment.--
        (1) The amount of a bonus under this section may not exceed--'' 
        and all that follows through the end of paragraph (1) and 
        inserting the following:
    ``(b) Bonus Amount.--The amount of a bonus under this section may 
not exceed $10,000.''.
            (3) Option to receive lump-sum payment.--Section 308b of 
        title 37, United States Code, is further amended--
                    (A) by striking paragraphs (1) and (2) of 
                subsection (c); and
                    (B) in paragraph (2) of subsection (b)--
                            (i) by striking ``(2) Any bonus payable 
                        under this section'' and inserting the 
                        following:
    ``(c) Payment in Lump Sum or Installments.--(1) A bonus payable to 
a member under this section shall be paid, upon the election of the 
member, in one lump sum or in partial payments under paragraph (2).
    ``(2) Any bonus payable in partial payments under this section''.
            (4) Redesignation of provisions.--Such section is further 
        amended--
                    (A) by redesignating subsections (d), (e), and (f), 
                as subsections (e), (f), and (g), respectively; and
                    (B) in subsection (c)(3)--
                            (i) by striking ``(3) In the case of'' and 
                        inserting ``(d) Personnel in Certain 
                        Contingency Operations.--In the case of''; and
                            (ii) by striking ``paragraph (1)(B) or''.

SEC. 4. TRICARE FOR RESERVE COMPONENT PERSONNEL.

    (a) Expanded Eligibility of Ready Reserve Members Under TRICARE 
program.--
            (1) Unconditional eligibility.--Subsection (a) of section 
        1076b of title 10, United States Code, is amended by striking 
        ``is eligible, subject to subsection (h), to enroll in 
        TRICARE'' and all that follows through ``an employer-sponsored 
        health benefits plan'' and inserting ``, except for a member 
        who is enrolled or is eligible to enroll in a health benefits 
        plan under chapter 89 of title 5, is eligible to enroll in 
        TRICARE, subject to subsection (h)''.
            (2) Permanent authority.--Subsection (l) of such section is 
        repealed.
            (3) Conforming repeal of obsolete provisions.--Such section 
        is further amended--
                    (A) by striking subsections (i) and (j); and
                    (B) by redesignating subsection (k) as subsection 
                (i).
    (b) Continuation of Non-TRICARE Health Benefits Plan Coverage for 
Certain Reserves Called or Ordered to Active Duty and Their 
Dependents.--
            (1) Required continuation.--
                    (A) Requirement.--Chapter 55 of title 10, United 
                States Code, is amended by inserting after section 
                1078a the following new section:
``Sec. 1078b. Continuation of non-TRICARE health benefits plan coverage 
              for dependents of certain Reserves called or ordered to 
              active duty
    ``(a) Payment of Premiums.--The Secretary concerned shall pay the 
applicable premium to continue in force any qualified health benefits 
plan coverage for the members of the family of an eligible reserve 
component member for the benefits coverage continuation period if 
timely elected by the member in accordance with regulations prescribed 
under subsection (j).
    ``(b) Eligible Member; Family Members.--(1) A member of a reserve 
component is eligible for payment of the applicable premium for 
continuation of qualified health benefits plan coverage under 
subsection (a) while serving on active duty pursuant to a call or order 
issued under a provision of law referred to in section 101(a)(13)(B) of 
this title during a war or national emergency declared by the President 
or Congress.
    ``(2) For the purposes of this section, the members of the family 
of an eligible reserve component member include only the member's 
dependents described in subparagraphs (A), (D), and (I) of section 
1072(2) of this title.
    ``(c) Qualified Health Benefits Plan Coverage.--For the purposes of 
this section, health benefits plan coverage for the members of the 
family of a reserve component member called or ordered to active duty 
is qualified health benefits plan coverage if--
            ``(1) the coverage was in force on the date on which the 
        Secretary notified the reserve component member that issuance 
        of the call or order was pending or, if no such notification 
        was provided, the date of the call or order;
            ``(2) on such date, the coverage applied to the reserve 
        component member and members of the family of the reserve 
        component member; and
            ``(3) the coverage has not lapsed.
    ``(d) Applicable Premium.--The applicable premium payable under 
this section for continuation of health benefits plan coverage for the 
family members of a reserve component member is the amount of the 
premium payable by the member for the coverage of the family members.
    ``(e) Maximum Amount.--The total amount that the Department of 
Defense may pay for the applicable premium of a health benefits plan 
for the family members of a reserve component member under this section 
in a fiscal year may not exceed the amount determined by multiplying--
            ``(1) the sum of one plus the number of the family members 
        covered by the health benefits plan, by
            ``(2) the per capita cost of providing TRICARE coverage and 
        benefits for dependents under this chapter for such fiscal 
        year, as determined by the Secretary of Defense.
    ``(f) Benefits Coverage Continuation Period.--The benefits coverage 
continuation period under this section for qualified health benefits 
plan coverage for the family members of an eligible reserve component 
member called or ordered to active duty is the period that--
            ``(1) begins on the date of the call or order; and
            ``(2) ends on the earlier of--
                    ``(A) the date on which the reserve component 
                member's eligibility for transitional health care under 
                section 1145(a) of this title terminates under 
                paragraph (3) of such section; or
                    ``(B) the date on which the reserve component 
                member elects to terminate the continued qualified 
                health benefits plan coverage of the member's family 
                members.
    ``(g) Extension of Period of COBRA Coverage.--Notwithstanding any 
other provision of law--
            ``(1) any period of coverage under a COBRA continuation 
        provision (as defined in section 9832(d)(1) of the Internal 
        Revenue Code of 1986) for an eligible reserve component member 
        under this section shall be deemed to be equal to the benefits 
        coverage continuation period for such member under this 
        section; and
            ``(2) with respect to the election of any period of 
        coverage under a COBRA continuation provision (as so defined), 
        rules similar to the rules under section 4980B(f)(5)(C) of such 
        Code shall apply.
    ``(h) Nonduplication of Benefits.--A member of the family of a 
reserve component member who is eligible for benefits under qualified 
health benefits plan coverage paid on behalf of the reserve component 
member by the Secretary concerned under this section is not eligible 
for benefits under the TRICARE program during a period of the coverage 
for which so paid.
    ``(i) Revocability of Election.--A reserve component member who 
makes an election under subsection (a) may revoke the election. Upon 
such a revocation, the member's family members shall become eligible 
for benefits under the TRICARE program as provided for under this 
chapter.
    ``(j) Regulations.--The Secretary of Defense shall prescribe 
regulations for carrying out this section. The regulations shall 
include such requirements for making an election of payment of 
applicable premiums as the Secretary considers appropriate.''.
                    (B) Clerical amendment.--The table of sections at 
                the beginning of such chapter is amended by inserting 
                after the item relating to section 1078a the following 
                new item:

``1078b. Continuation of non-TRICARE health benefits plan coverage for 
                            dependents of certain Reserves called or 
                            ordered to active duty.''.
            (2) Applicability.--Section 1078b of title 10, United 
        States Code (as added by paragraph (1)), shall apply with 
        respect to calls or orders of members of reserve components of 
        the Armed Forces to active duty as described in subsection (b) 
        of such section, that are issued by the Secretary of a military 
department before, on, or after the date of the enactment of this Act, 
but only with respect to qualified health benefits plan coverage (as 
described in subsection (c) of such section) that is in effect on or 
after the date of the enactment of this Act.

SEC. 5. CHILD CARE FOR CHILDREN OF MEMBERS OF ARMED FORCES ON ACTIVE 
              DUTY FOR OPERATION ENDURING FREEDOM OR OPERATION IRAQI 
              FREEDOM.

    (a) Child Care for Children Without Access to Military Child 
Care.--
            (1) Authority.--In any case where the children of a covered 
        member of the Armed Forces are geographically dispersed and do 
        not have practical access to a military child development 
        center, the Secretary of Defense may, to the extent funds are 
        available for such purpose, provide such funds as are necessary 
        permit the member's family to secure access for such children 
        to State licensed child care and development programs and 
        activities in the private sector that are similar in scope and 
        quality to the child care and development programs and 
        activities the Secretary would otherwise provide access to 
        under subchapter II of chapter 88 of title 10, United States 
        Code, and other applicable provisions of law.
            (2) Procedures.--Funds may be provided under paragraph (1) 
        in accordance with the provisions of section 1798 of title 10, 
        United States Code, or by such other mechanism as the Secretary 
        considers appropriate.
            (3) Priorities.--The Secretary shall prescribe in 
        regulations priorities for the allocation of funds for the 
        provision of access to child care under paragraph (1) in 
        circumstances where funds are inadequate to provide all 
        children described in that paragraph with access to child care 
        as described in that paragraph.
    (b) Preservation of Services and Programs.--The Secretary shall 
provide for the attendance and participation of children in military 
child development centers and child care and development programs and 
activities under subsection (a) in a manner that preserves the scope 
and quality of child care and development programs and activities 
otherwise provided by the Secretary.
    (c) Funding.--Amounts otherwise available to the Department of 
Defense and the military departments under this Act may be available 
for purposes of providing access to child care under subsection (a).
    (d) Definitions.--In this section:
            (1) Covered members of the armed forces.--The term 
        ``covered members of the Armed Forces'' means members of the 
        Armed Forces on active duty, including members of the Reserves 
        who are called or ordered to active duty under a provision of 
        law referred to in section 101(a)(13)(B) of title 10, United 
        States Code, for Operation Enduring Freedom or Operation Iraqi 
        Freedom.
            (2) Military child development center.--The term ``military 
        child development center'' has the meaning given such term in 
        section 1800(1) of title 10, United States Code.

SEC. 6. RIGHTS AND DUTIES UNDER USERRA.

    (a) Requirement for Employers To Provide Notice of Rights and 
Duties Under USERRA.--
            (1) Notice.--
                    (A) Requirement for notice.--Chapter 43 of title 
                38, United States Code, is amended by adding at the end 
                the following new section:
``Sec. 4334. Notice of rights and duties
    ``(a) Requirement To Provide Notice.--Each employer shall provide 
to persons entitled to rights and benefits under this chapter a notice 
of the rights, benefits, and obligations of such persons and such 
employers under this chapter. The requirement for the provision of 
notice under this section may be met by the posting of the notice where 
employers customarily place notices for employees.
    ``(b) Content of Notice.--The Secretary shall provide to employers 
the text of the notice to be provided under this section.''.
                    (B) Clerical amendment.--The table of sections at 
                the beginning of such chapter is amended by adding at 
                the end the following new item:

``4334. Notice of rights and duties.''.
            (2) Implementation.--
                    (A) Requirement.--Not later than the date that is 
                90 days after the date of the enactment of this Act, 
                the Secretary of Labor shall make available to 
                employers the notice required under section 4334 of 
                title 38, United States Code, as added by paragraph 
                (1).
                    (B) Applicability.--The amendments made by this 
                subsection shall apply to employers under chapter 43 of 
                such title on and after the first date referred to in 
                subparagraph (A).
    (b) Demonstration Project for Referral of USERRA Claims Against 
Federal Agencies to the Office of Special Counsel.--
            (1) Establishment of project.--The Secretary of Labor and 
        the Office of Special Counsel shall carry out a demonstration 
        project under which certain claims against Federal executive 
        agencies under the Uniformed Services Employment and 
        Reemployment Rights Act under chapter 43 of title 38, United 
        States Code, are referred to, or otherwise received by, the 
        Office of Special Counsel for assistance, including 
        investigation and resolution of the claim as well as 
        enforcement of rights with respect to the claim.
            (2) Referral of all prohibited personnel action claims to 
        the office of special.--
                    (A) Covered claims.--Under the demonstration 
                project, the Office of Special Counsel shall receive 
                and investigate all claims under the Uniformed Services 
                Employment and Reemployment Rights Act with respect to 
                Federal executive agencies in cases where the Office of 
                Special Counsel has jurisdiction over related claims 
                pursuant to section 1212 of title 5, United States 
                Code.
                    (B) Related claims.--For purposes of subparagraph 
                (A), a related claim is a claim involving the same 
                Federal executive agency and the same or similar 
                factual allegations or legal issues as those being 
                pursued under a claim under the Uniformed Services 
                Employment and Reemployment Rights Act.
            (3) Referral of other claims against federal executive.--
                    (A) Other claims.--Under the demonstration project, 
                the Secretary--
                            (i) shall refer to the Office of Special 
                        Counsel all claims described in subparagraph 
                        (B) made during the period of the demonstration 
                        project; and
                            (ii) may refer any claim described in 
                        subparagraph (B) filed before the demonstration 
                        project that is pending before the Secretary at 
                        the beginning of the demonstration project.
                    (B) Covered claims.--A claim referred to in 
                subparagraph (A) is a claim under chapter 43 of title 
                38, United States Code, against a Federal executive 
                agency by a claimant with a social security account 
                number with an odd number as its terminal digit, or, in 
                the case of a claim that does not contain a social 
                security account number, a case number assigned to the 
                claim with an odd number as its terminal digit.
            (4) Administration of demonstration --
                    (A) Office of special counsel.--The Office of 
                Special Counsel shall administer the demonstration 
                project. The Secretary shall cooperate with the Office 
                of Special Counsel in carrying out the demonstration 
                project.
                    (B) Law administered by the secretary of veterans 
                affairs.--In the case of any claim referred to, or 
                otherwise received by, the Office of Special Counsel 
                under the demonstration project, any reference to the 
                ``Secretary'' in sections 4321, 4322, and 4326 of title 
                38, United States Code, is deemed a reference to the 
                ``Office of Special Counsel''.
                    (C) Retention of jurisdiction over referred 
                claims.--In the case of any claim referred to, or 
                otherwise received by, the Office of Special Counsel 
                under the demonstration project, the Office of Special 
                Counsel shall retain administrative jurisdiction over 
                the claim.
            (5) Period of project.--The demonstration project shall be 
        carried out during the period beginning on the date that is 60 
        days after the date of the enactment of this Act, and ending on 
        September 30, 2007.
            (6) Periodic evaluations.--The Comptroller General of the 
        United States shall conduct periodic evaluations of the 
        demonstration project under this subsection.
            (7) Report on evaluations.--Not later than April 1, 2007, 
        the Comptroller General shall submit to Congress a report on 
        the evaluations conducted under paragraph (6). The report shall 
        include the following information and recommendations:
                    (A) A description of the operation and results of 
                the demonstration program, including--
                            (i) the number of claims described in 
                        paragraph (3) referred to, or otherwise 
                        received by, the Office of Special Counsel and 
                        the number of such claims referred to the 
                        Secretary of Labor; and
                            (ii) for each Federal executive agency, the 
                        number of claims resolved, the type of 
                        corrective action obtained, the period of time 
                        for final resolution of the claim, and the 
                        results obtained.
                    (B) An assessment of whether referral to the Office 
                of Special Counsel of claims under the demonstration 
                project--
                            (i) improved services to servicemembers and 
                        veterans; or
                            (ii) significantly reduced or eliminated 
                        duplication of effort and unintended delays in 
                        resolving meritorious claims of those 
                        servicemembers and veterans.
                    (C) An assessment of the feasibility and 
                advisability of referring all claims under chapter 43 
                of title 38, United States Code, against Federal 
                executive agencies to the Office of Special Counsel for 
                investigation and resolution.
                    (D) Such other recommendations for administrative 
                action or legislation as the Comptroller General 
                determines appropriate.
            (8) Definitions.--In this subsection:
                    (A) Office of special counsel.--The term ``Office 
                of Special Counsel'' means the Office of Special 
                Counsel established by section 1211 of title 5, United 
                States Code.
                    (B) Secretary.--The term ``Secretary'' means the 
                Secretary of Labor.
                    (C) Federal executive agency.--The term ``Federal 
                executive agency'' has the meaning given that term in 
                section 4303(5) of title 38, United States Code.
    (c) USERRA Implementing Regulations.--
            (1) Requirement for regulations.--Subsections (a) and 
        (b)(1) of section 4331 of title 38, United States Code, are 
        amended by striking ``may prescribe'' and inserting ``shall 
        prescribe''.
            (2) Clarification of right to merit pay increases.--The 
        regulations prescribed for the implementation of chapter 43 of 
        title 38, United States Code, under section 4331 of such title 
        shall include regulations that clarify that the entitlement of 
        persons returning to employment under such chapter to receive 
        pay increases under merit pay systems of employers may not be 
        denied on the basis of lack of work performance evaluations for 
        periods of absence for active duty in the uniformed services.

SEC. 7. IMPROVED EDUCATIONAL ASSISTANCE BENEFITS FOR MEMBERS OF THE 
              SELECTED RESERVE.

    (a) Increase in Amount of Basic Educational Assistance.--
            (1) In general.--Section 16131(b) of title 10, United 
        States Code, is amended to read as follows:
    ``(b) Except as provided in subsections (d) through (f), each 
educational assistance program established under subsection (a) shall 
provide for payment by the Secretary concerned, through the Secretary 
of Veterans Affairs, to each person entitled to educational assistance 
under this chapter who is pursuing a program of education of an 
educational assistance allowance at the following monthly rates:
            ``(1) For such a program of education pursued on a full-
        time basis, at the monthly rate equal to the applicable 
        percentage (as defined in paragraph (3)) of the rate that 
        applies for the month under section 3015(a)(1) of title 38.
            ``(2)(A) Subject to subparagraph (B), for such a program of 
        education pursued on less than a full-time basis, at an 
        appropriately reduced rate, as determined under regulations 
        which the Secretaries concerned shall prescribe.
            ``(B) No payment may be made to a person for less than 
        half-time pursuit of such a program of education if tuition 
        assistance is otherwise available to the person for such 
        pursuit from the military department concerned.
            ``(3) In this subsection, the term `applicable percentage' 
        means, with respect to months occurring during--
                    ``(A) fiscal year 2005, 33 percent;
                    ``(B) fiscal year 2006, 37 percent;
                    ``(C) fiscal year 2007, 41 percent;
                    ``(D) fiscal year 2008, 45 percent; and
                    ``(E) fiscal year 2009, and each subsequent fiscal 
                year, 50 percent.''.
            (2) Effective date.--The amendments made by paragraph (1) 
        shall take effect on October 1, 2004, and shall apply with 
        respect to educational assistance allowances under section 
        16131(b) of such title paid for months after September 2004.
    (b)  Expansion of Eligibility Requirements for Members of the 
Selected Reserve Having Served on Active Duty for a Period of 24 Non-
Consecutive Months Under Chapter 30 of Title 38, United States Code.--
            (1) Credit for 24 months of active duty service over a 
        period of 5 years.--Subsection 3012(a) of title 38, United 
        States Code, is amended in paragraphs (1)(A)(i), (1)(B)(i), and 
        (1)(C)(iii)(I) by striking ``two years of continuous active 
        duty'' each place it appears and inserting ``a cumulative 
        period of 24 months during any 5-year period''.
            (2) Conforming amendment.--Subsection (b) of section 3012 
        of such title is amended in paragraph (1) by striking ``during 
        such two years'' and inserting ``at any time during such 5-year 
        period''.
            (3) Effective date.--The amendments made by this subsection 
        shall apply on or after October 1, 2005.

SEC. 8. REDUCTION IN AGE FOR RECEIPT OF MILITARY RETIRED PAY FOR 
              NONREGULAR SERVICE.

    (a) Reduction in Age.--Section 12731(a)(1) of title 10, United 
States Code, is amended by striking ``at least 60 years of age'' and 
inserting ``at least 55 years of age''.
    (b) Application to Existing Provisions of Law or Policy.--With 
respect to any provision of law, or of any policy, regulation, or 
directive of the executive branch, that refers to a member or former 
member of the uniformed services as being eligible for, or entitled to, 
retired pay under chapter 1223 of title 10, United States Code, but for 
the fact that the member or former member is under 60 years of age, 
such provision shall be carried out with respect to that member or 
former member by substituting for the reference to being 60 years of 
age a reference to the age in effect for qualification for such retired 
pay under section 12731(a) of title 10, United States Code, as amended 
by subsection (a).
    (c) Effective Date.--The amendment made by subsection (a) shall 
take effect on the first day of the first month beginning on or after 
the date of the enactment of this Act and shall apply to retired pay 
payable for that month and subsequent months.

SEC. 9. DEPUTY UNDER SECRETARY OF DEFENSE FOR PERSONNEL AND READINESS 
              (RESERVE AFFAIRS).

    (a) Establishment of Position.--
            (1) Position and duties.--Chapter 4 of title 10, United 
        States Code, is amended by inserting after section 136a the 
        following new section:
``Sec. 136b. Deputy Under Secretary of Defense for Personnel and 
              Readiness (Reserve Affairs)
    ``(a) There is a Deputy Under Secretary of Defense for Personnel 
and Readiness (Reserve Affairs), appointed from civilian life by the 
President, by and with the advice and consent of the Senate.
    ``(b) The Deputy Under Secretary of Defense for Personnel and 
Readiness (Reserve Affairs) shall have as his principal duty the 
overall supervision of reserve component affairs of the Department of 
Defense.''.
            (2) Clerical amendment.--The table of sections at the 
        beginning of such chapter is amended by inserting after the 
        item relating to section 136a the following new item:

``136b. Deputy Under Secretary of Defense for Personnel and Readiness 
                            (Reserve Affairs).''.
    (b) Executive Level IV.--Section 5315 of title 5, United States 
Code, is amended by inserting after ``Deputy Under Secretary of Defense 
for Personnel and Readiness.'' the following:
            ``Deputy Under Secretary of Defense for Personnel and 
        Readiness (Reserve Affairs).''.
    (c) Elimination of Position of Assistant Secretary of Defense for 
Reserve Affairs.--
            (1) Repeal of requirement for position.--Subsection (b) of 
        section 138 of title 10, United States Code, is amended--
                    (A) by striking paragraph (2); and
                    (B) by redesignating paragraphs (3), (4), and (5), 
                as paragraphs (2), (3), and (4), respectively.
            (2) Reduction in total number of assistant secretaries of 
        defense.--
                    (A) Authorized number.--Subsection (a) of such 
                section is amended by striking ``nine'' and inserting 
                ``eight''.
                    (B) Conforming amendment.--Section 5315 of title 5, 
                United States Code, is amended by striking ``(9)'' 
                after ``Assistant Secretaries of Defense'' and 
                inserting ``(8)''.
    (d) Effective Date.--The amendments made by subsection (c) shall 
take effect on the date on which a person is first appointed as Deputy 
Under Secretary of Defense for Personnel and Readiness (Reserve 
Affairs).
                                 <all>