II 111th CONGRESS 1st Session S. 1008 IN THE SENATE OF THE UNITED STATES May 7, 2009 Mrs. Shaheen (for herself and Mr. Gregg) introduced the following bill; which was read twice and referred to the Committee on Armed Services A BILL To amend title 10, United States Code, to limit recoupments of separation pay, special separation benefits, and voluntary separation incentive from members of the Armed Forces subsequently receiving retired or retainer pay.

1.

Short title

This Act may be cited as the Military Retired Pay Fairness Act of 2009.

2.

Limitations on recoupment of separation pay, special separation benefits, and voluntary separation incentive from members subsequently receiving retired or retainer pay

(a)

Separation pay and special separation benefits

Section 1174(h)(1) of title 10, United States Code, is amended— (1)by inserting (A) after (1); (2)in subparagraph (A), as so designated, by striking so much of such pay as is based on the service for which he received separation pay under this section or separation pay, severance pay, or readjustment pay under any other provision of law and inserting an amount, in such schedule of monthly installments as the Secretary of Defense shall specify taking into account the financial ability of the member to pay and avoiding the imposition of undue financial hardship on the member and member’s dependents,; and (3)by adding at the end the following new subparagraphs: (B)The amount deducted under subparagraph (A) from a payment of retired or retainer pay may not exceed 25 percent of the amount of the member’s retired or retainer pay for that month unless the member requests or consents to deductions at an accelerated rate. The Secretary concerned shall consult with the member regarding the repayment rate to be imposed, taking into account the financial ability of the member to pay and avoiding the imposition of an undue hardship on the member and the member’s dependents. (C)The deduction of amounts from the retired or retainer pay of a member under this paragraph may not commence until the date that is 90 days after the date on which the Secretary concerned notifies the member of the deduction of such amounts under this paragraph. Any notice under this subparagraph shall be designed to provide clear and comprehensive information on the deduction of amounts under this paragraph, including information on the determination of the amount and period of installments under this paragraph. (D)The Secretary concerned may waive the deduction of amounts from the retired or retainer pay of a member under this paragraph if the Secretary determines that deduction of such amounts would result in a financial hardship for the member. . (b)

Voluntary separation incentive

Section 1175(e)(3) of such title is amended— (1)in subparagraph (A), by striking so much of such pay as is based on the service for which he received the voluntary separation incentive and inserting an amount, in such schedule of monthly installments as the Secretary of Defense shall specify taking into account the financial ability of the member to pay and avoiding the imposition of undue financial hardship on the member and member’s dependents,; (2)by redesignating subparagraph (B) as subparagraph (C); (3)by inserting after subparagraph (A) the following new subparagraph: (B)The amount deducted under subparagraph (A) from a payment of retired or retainer pay may not exceed 25 percent of the amount of the member’s retired or retainer pay for that month unless the member requests or consents to deductions at an accelerated rate. The Secretary concerned shall consult with the member regarding the repayment rate to be imposed, taking into account the financial ability of the member to pay and avoiding the imposition of an undue hardship on the member and the member’s dependents. ; and (4)by adding at the end the following new subparagraphs: (D)The deduction of amounts from the retired or retainer pay of a member under this paragraph may not commence until the date that is 90 days after the date on which the Secretary concerned notifies the member of the deduction of such amounts under this paragraph. Any notice under this subparagraph shall be designed to provide clear and comprehensive information on the deduction of amounts under this paragraph, including information on the determination of the amount and period of installments under this paragraph. (E)The Secretary concerned may waive the deduction of amounts from the retired or retainer pay of a member under this paragraph if the Secretary determines that deduction of such amounts would result in a financial hardship for the member. . (c)

Effective date

The amendments made by this section shall take effect on the first day of the first month beginning on or after the date of the enactment of this Act and apply to deductions made from the retired or retainer pay of members of the uniformed services for that month and subsequent months.