thedrifter
05-21-07, 08:53 AM
Cleaning up special pay
House endorses DoD consolidation plan
By Rick Maze - rmaze@militarytimes.com
Posted : May 28, 2007
About 60 special pays and bonuses will be consolidated into eight kinds of payments under a Pentagon plan endorsed by the House of Representatives.
The plan, aimed at simplifying a complex and confusing aspect of military compensation, would be a “no-cost” initiative for 2008, with no major changes in neither eligibility for bonuses and incentive pay nor in how much is paid. In fact, the House version of the 2008 defense authorization bill specifically bars the Pentagon from making any increases.
But starting in 2009, the plan — years in the making — could result in some dramatic increases for people in certain critical specialties, according to the Congressional Budget Office, a bipartisan arm of Congress.
In a report on the cost of the 2008 defense authorization bill, which includes the bonus plan, CBO budget analysts estimate that the Defense Department is spending about $5.5 billion this year on special pays and bonuses.
There is an additional $2.1 billion cost for 2008, but budget analysts said that is largely because the bill extends the life of some bonuses that otherwise would expire.
For 2009, analysts predicted a $3.2 billion price tag for the consolidation plan, $1 billion more than for 2008 — and CBO analysts say this reflects the fact that 2009 would be the first year the services could pay higher bonuses allowed under the consolidation plan’s new limits.
Exactly how that $1 billion would be used is unclear, and the Defense Department declined to speculate on questions about what might happen two years from now.
Part of the uncertainty is expected because the House bill gives the Pentagon one year to come up with a way to ensure an “orderly transfer” of bonuses and special pays from the current system to the new plan — a transition that could take up to a decade to complete.
In a report accompanying the bill, the House Armed Services Committee says it believes “that reform and consolidation of special and incentive pays will result in a pay system that is easier to understand and less expensive to administer.”
Consolidation would result in eight bonus categories, with three separate special cases that would remain outside the consolidation: critical skill retention bonuses; the 15-year Career Status Bonus under the Redux retirement system; and continuation of combat pays for service members who are hospitalized for combat-related injuries or illnesses.
The eight main categories:
•Enlisted bonuses. The general bonus authority for enlisted personnel includes active and reserve enlistment, re-enlistment, voluntary enlistment extension and transfers to a reserve component.
The services could use skill, unit, grade or assignment to determine eligibility and could also set conditions, such as the length of service required to get the payment. The maximum enlistment bonus would be $50,000 for a minimum two-year obligation. The maximum re-enlistment, extension or transfer bonus would be $40,000 a year for each year of continued service.
Any of the bonuses could be paid in lump sum or installment.
•Officer bonuses. Active and reserve officers could receive bonuses for commissioning or appointment, for affiliating with or transferring to a reserve component, and for agreeing to stay on active duty.
Commissioning and reserve affiliation bonuses could be up to $60,000. Bonuses for transferring to the reserves or for continued active service could be up to $50,000 for each year of additional service.
Like bonuses for enlisted members, payments could be either lump-sum or installments, at the discretion of the services.
•Nuclear officer incentives. For Navy nuclear officers, the plan allows a bonus when selected for nuclear power training or when meeting technical or operational qualifications. Also, incentive pay is authorized for remaining on active duty while maintaining qualifications. The combination of bonus and incentive pay would be up to $60,000 a year.
•Aviation officer incentives. Aviation incentive pay of up to $850 a month and an aviation continuation bonus of up to $25,000 a year would be authorized. Incentive pay would include those training to be aviators, or aviators who are involved in “frequent or regular” flying duties or agree to continue serving for a specific period.
Aviators could get lump-sum or installment payments. National Guard and reserve aviators could receive pro-rated payments.
•Health professional incentives. For officers in the medical corps, dental corps, nurse corps, veterinary corps, Public Health Service or in the fields of medical service, biomedical sciences or physician assistant, a bonus of up to $100,000 a year would be available for accepting a commission or appointment, plus up to $100,000 a year in incentive pay and up to $25,000 a year for being board certified.
The bonuses would be paid in a lump sum, while incentive pays could be lump-sum or monthly.
•Hazardous duty pay. The new plan would feature two rates of hazardous duty pay.
One payment, of up to $450 a month, would be for those in a designated hostile-fire area or in an area where they are exposed to hostile fire or in “grave danger of physical injury.”
A second payment, of up to $250 a month, would be available for those performing duty in a foreign area that is designated as an area of imminent danger.
The $450 rate would be available for serving any portion of a month in a qualifying area, while a full month of duty would be required to be eligible for the $250 payment.
Rates would be the same for officers and enlisted personnel. Retroactive payments, such as for those who were exposed to hostile fire in an area that was not officially designated as a hostile fire zone at the time, would be authorized. Service members could qualify for more than one hazard pay, just as they can under current law.
•Assignment and special duty pay. For performing special assignments, the plan offers a maximum $5,000 monthly pay that could be provided in installments or in a lump sum.
There is no further description, which leaves the services wide authority to tailor these pays for people by assignment, location or unit.
Lump-sum amounts could be no more than the maximum monthly payment multiplied by the number of continuous months of assignment or special duty. That means, for example, payment of no more than $60,000 a year.
Reservists could receive pro-rated amounts depending on the number of days of inactive-duty training performed in a month.
•Proficiency and skill incentives. Skill incentive pay would be up to $1,000 a month, with the same criteria and payment rate required for officers and enlisted members.
A separate proficiency bonus of up to $12,000 a year also would be available, with officers and enlisted members again having the same rules and same payments.
As with many other special pays, reservists would be eligible for prorated amounts based on their inactive-duty training time, with one exception: Reservists who qualify for proficiency pay for having foreign language skills could receive the same payment as active-duty members.
Streamlining the long list of military bonuses and special pays now on the books was a key proposal of former Defense Secretary Donald Rumsfeld’s Advisory Committee on Military Compensation, formed in 2005 to look for ways to simplify the compensation system.
Many of that committee's ideas were channeled into the follow-on 10th Quadrennial Review of Military Compensation, which is still ongoing. The initiative to consolidate bonuses and special pays was pushed out early because it is a relatively easy and uncontroversial change.
Ellie
House endorses DoD consolidation plan
By Rick Maze - rmaze@militarytimes.com
Posted : May 28, 2007
About 60 special pays and bonuses will be consolidated into eight kinds of payments under a Pentagon plan endorsed by the House of Representatives.
The plan, aimed at simplifying a complex and confusing aspect of military compensation, would be a “no-cost” initiative for 2008, with no major changes in neither eligibility for bonuses and incentive pay nor in how much is paid. In fact, the House version of the 2008 defense authorization bill specifically bars the Pentagon from making any increases.
But starting in 2009, the plan — years in the making — could result in some dramatic increases for people in certain critical specialties, according to the Congressional Budget Office, a bipartisan arm of Congress.
In a report on the cost of the 2008 defense authorization bill, which includes the bonus plan, CBO budget analysts estimate that the Defense Department is spending about $5.5 billion this year on special pays and bonuses.
There is an additional $2.1 billion cost for 2008, but budget analysts said that is largely because the bill extends the life of some bonuses that otherwise would expire.
For 2009, analysts predicted a $3.2 billion price tag for the consolidation plan, $1 billion more than for 2008 — and CBO analysts say this reflects the fact that 2009 would be the first year the services could pay higher bonuses allowed under the consolidation plan’s new limits.
Exactly how that $1 billion would be used is unclear, and the Defense Department declined to speculate on questions about what might happen two years from now.
Part of the uncertainty is expected because the House bill gives the Pentagon one year to come up with a way to ensure an “orderly transfer” of bonuses and special pays from the current system to the new plan — a transition that could take up to a decade to complete.
In a report accompanying the bill, the House Armed Services Committee says it believes “that reform and consolidation of special and incentive pays will result in a pay system that is easier to understand and less expensive to administer.”
Consolidation would result in eight bonus categories, with three separate special cases that would remain outside the consolidation: critical skill retention bonuses; the 15-year Career Status Bonus under the Redux retirement system; and continuation of combat pays for service members who are hospitalized for combat-related injuries or illnesses.
The eight main categories:
•Enlisted bonuses. The general bonus authority for enlisted personnel includes active and reserve enlistment, re-enlistment, voluntary enlistment extension and transfers to a reserve component.
The services could use skill, unit, grade or assignment to determine eligibility and could also set conditions, such as the length of service required to get the payment. The maximum enlistment bonus would be $50,000 for a minimum two-year obligation. The maximum re-enlistment, extension or transfer bonus would be $40,000 a year for each year of continued service.
Any of the bonuses could be paid in lump sum or installment.
•Officer bonuses. Active and reserve officers could receive bonuses for commissioning or appointment, for affiliating with or transferring to a reserve component, and for agreeing to stay on active duty.
Commissioning and reserve affiliation bonuses could be up to $60,000. Bonuses for transferring to the reserves or for continued active service could be up to $50,000 for each year of additional service.
Like bonuses for enlisted members, payments could be either lump-sum or installments, at the discretion of the services.
•Nuclear officer incentives. For Navy nuclear officers, the plan allows a bonus when selected for nuclear power training or when meeting technical or operational qualifications. Also, incentive pay is authorized for remaining on active duty while maintaining qualifications. The combination of bonus and incentive pay would be up to $60,000 a year.
•Aviation officer incentives. Aviation incentive pay of up to $850 a month and an aviation continuation bonus of up to $25,000 a year would be authorized. Incentive pay would include those training to be aviators, or aviators who are involved in “frequent or regular” flying duties or agree to continue serving for a specific period.
Aviators could get lump-sum or installment payments. National Guard and reserve aviators could receive pro-rated payments.
•Health professional incentives. For officers in the medical corps, dental corps, nurse corps, veterinary corps, Public Health Service or in the fields of medical service, biomedical sciences or physician assistant, a bonus of up to $100,000 a year would be available for accepting a commission or appointment, plus up to $100,000 a year in incentive pay and up to $25,000 a year for being board certified.
The bonuses would be paid in a lump sum, while incentive pays could be lump-sum or monthly.
•Hazardous duty pay. The new plan would feature two rates of hazardous duty pay.
One payment, of up to $450 a month, would be for those in a designated hostile-fire area or in an area where they are exposed to hostile fire or in “grave danger of physical injury.”
A second payment, of up to $250 a month, would be available for those performing duty in a foreign area that is designated as an area of imminent danger.
The $450 rate would be available for serving any portion of a month in a qualifying area, while a full month of duty would be required to be eligible for the $250 payment.
Rates would be the same for officers and enlisted personnel. Retroactive payments, such as for those who were exposed to hostile fire in an area that was not officially designated as a hostile fire zone at the time, would be authorized. Service members could qualify for more than one hazard pay, just as they can under current law.
•Assignment and special duty pay. For performing special assignments, the plan offers a maximum $5,000 monthly pay that could be provided in installments or in a lump sum.
There is no further description, which leaves the services wide authority to tailor these pays for people by assignment, location or unit.
Lump-sum amounts could be no more than the maximum monthly payment multiplied by the number of continuous months of assignment or special duty. That means, for example, payment of no more than $60,000 a year.
Reservists could receive pro-rated amounts depending on the number of days of inactive-duty training performed in a month.
•Proficiency and skill incentives. Skill incentive pay would be up to $1,000 a month, with the same criteria and payment rate required for officers and enlisted members.
A separate proficiency bonus of up to $12,000 a year also would be available, with officers and enlisted members again having the same rules and same payments.
As with many other special pays, reservists would be eligible for prorated amounts based on their inactive-duty training time, with one exception: Reservists who qualify for proficiency pay for having foreign language skills could receive the same payment as active-duty members.
Streamlining the long list of military bonuses and special pays now on the books was a key proposal of former Defense Secretary Donald Rumsfeld’s Advisory Committee on Military Compensation, formed in 2005 to look for ways to simplify the compensation system.
Many of that committee's ideas were channeled into the follow-on 10th Quadrennial Review of Military Compensation, which is still ongoing. The initiative to consolidate bonuses and special pays was pushed out early because it is a relatively easy and uncontroversial change.
Ellie