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President Obama Finally Releases the Fiscal Year 2014 DOD Budget Request

A quick review of the Department of Defense (DOD) portion of the president’s Fiscal Year (FY) 2014 budget released April 10. Even though many in Congress pronounced the President’s FY 2014 budget request "dead on arrival," its provisions will spawn many hours of debate in congressional committees and work for the legislative staff of The American Legion. The request includes $526.6 billion for DOD’s base budget. This represents a reduction in spending in that the dollar increase does not keep up with inflation. Funding requests for the Overseas Contingency Operation budget was not in this budget.

Both Secretary of Defense Hagel and Chairman of the Joint Chiefs of Staff General Dempsey will stress to Congress the importance of giving DOD flexibility and time to make hard decisions and to adjust to budget cuts. This will be the crux of the message they take to Capitol Hill as it goes through the authorization and appropriation process. That process of House and Senate hearings in the Armed Services and Appropriations committees has already started. And as of this date although the House and Senate have each passed budget resolutions there has been no decision to begin a conference committee to iron out the differences. It is the opinion of legislative staff that there will probably not be a congressional budget resolution this year.


President Obama requests that sequestration be rescinded and the budget request includes government-wide cuts that would replace the across-the-board sequester cuts scheduled to be in effect for the next nine years. Under sequestration, DOD faces $500 billion in spending cuts over the 10 years. Under the President’s proposal, DOD absorbs only $150 billion, and most of that amount in the out-years. Secretary Hagel noted that the delay gives the Department time to prepare, which is "desperately" needed.

If sequestration is not de-triggered by Congress, the budget proposal for DOD needs to be reduced by about $52 billion for FY 2014. However, legislative staff doubt Congress will eliminate the across-the-board cuts even if comparable spending reductions are found. And DOD warns that impacts from training cutbacks, civilian furloughs, maintenance deferrals, and other actions will continue to be felt into FY 2014 even if sequestration is eliminated. General Dempsey noted that it "costs more to get ready than it does to stay ready." When discussing the DOD budget request, he observed it is too soon to know the full costs to the military of the sequester actions being taken this fiscal year.

Health care

The budget request includes $49.4 billion for the DOD Unified Medical Budget. The Administration claims that includes $8.9 billion saved due to more favorable medical cost inflation trends in the military and civilian arenas. In addition, a study to be completed in September is supposed to provide the Administration with more options to reduce health care costs, largely through identification of ways to improve efficiency in medical treatment facility operations. Defense Comptroller General Secretary Hale said the Military Health System (MHS) has some "significant underutilizations" among its facilities. He foresees, and the budget accounts for, consolidation of those treatment facilities. According to DOD staff, much of that consolidation and efficiency improvements will be achieved with the implementation of the Defense Health Agency (DHA). That agency is scheduled to begin in October (October 1 is the beginning of FY 2014).

By September 30, 2014, the end of FY 2014, MHS also intends to realign its resources to support only the most effective psychological health programs. The Department has begun inventorying and assessing these programs.


The budget request takes into account "adjusted" TRICARE cost sharing requirements, for a savings of $1.4 billion in FY 2014. Secretary Hagel said these adjustments bring the cost-sharing closer, when adjusted for inflation, to the levels envisioned by Congress when the program was created. In reality, the change would increase TRICARE Prime fees to 2.95% of gross retirement pay for 2014, with premiums capped at $750 per year for most retirees ($900 per year for retired generals and admirals). The fee would increase up to 4% in 2017, capping at $1200 ($1800 for flag officers).

In addition, DOD requests a new annual enrollment fee of $140 for family coverage under TRICARE Standard. Another new fee would be assessed on TRICARE for Life (T4L), at 0.5% of retired pay in 2014. That fee would increase a quarter of a percentage point per year until it hits 2% in 2017.

These kinds of requests have been made before by the Bush and Obama administrations; Congress has never supported these requests. However, for the first time, President Obama has changed this request to one that is a provision that is means-based and specifically exempts disabled retirees, their families, and the families of those who died on active duty, from the increases. These "cost sharing adjustments" could make the TRICARE program less attractive to younger retirees who have access to health insurance through other outlets (such as a new employer). However, when the Bush Administration included the calculation of younger retirees leaving TRICARE into its projected budget savings, Congress was not amused. However, The American Legion must be more vigilant on this issue because given today’s fiscal pressures attempts will be made to force Congress to be more accepting of increasing TRICARE cost sharing. And DOD leadership say this kind of cost increases to retirees is a necessity in order for DOD to absorb the budgetary cuts being required of it.

Base closings

The budget request again asks for creation of a Base Realignment and Closure (BRAC) Commission in 2015. The Administration admits this will add $2.4 billion in spending over the next five years. However, it claims closures and realignments will result in substantial long-term savings. This request is in line with previously reported testimony by a number of high-ranking Pentagon civilian and uniformed officials in recent months. They maintain that due to the drawdown in the authorized endstrength of the force the military will be left with unneeded infrastructure. Note that one change from last year’s request is DOD’s request is for a single round of base closings, not two, as has been previously requested. Another round of BRAC also agrees with a recommendation in a GAO report released Thursday calling upon DOD to consider ways to engage in more joint basing.


The budget request includes a 1% pay raise for uniformed personnel in FY 2014 (today civilian employees are covered by the statutory federal employee pay freeze). This is less than the previously planned 1.8%; in addition, DOD stressed the importance of slowing down compensation increases in order to hold down the top line of the budget. Also there are reports about the wisdom of why the Administration is reducing troop endstrength yet at the same time incentivizes them to enlist or remain in service by increasing their pay; thus causing further problems down the road if DOD has to resort to involuntary reductions of the force which will entail higher costs.

The Administration also requests $8.5 billion for military family programs. The Department also promises to work to eliminate duplicative and non-productive programs in the coming year.

Research, Development, Test & Evaluation (RDT&E)

The FY 2014 budget requests $67.5 billion for RDT&E activities. DARPA is slated for $2.9 billion. DARPA was highlighted last week as a primary player in the President’s new Brain Initiative, to research and map the human brain.


Poorly performing acquisition programs are eliminated or restructured, for a savings of $8.2 billion.

As stated above, the Overseas Contingency Operations part of the budget request will be submitted at a later date. The Administration claims the withdrawal from Afghanistan is too hard to fully predict at this point. Secretary Hale says that request will "hopefully" be up to Congress by the end of the month.

Secretary Hale predicts a reduction in the civilian workforce of five to six percent between FY 2013 and FY 2018, which means roughly forty thousand to fifty thousand fewer employees. Most of that reduction occurs in the out-years, and through (hopefully, according to Secretary Hale) attrition. He expects most of the attrition will be accounted for in the civilian workforce reductions that will occur primarily due to base closures/realignments and MHS facility consolidations. And if DOD is not granted another round of base closures, DOD would have to find other places and ways to reduce the civilian workforce.


Legion Testifies on Veterans’ Legislation

On April 10 The American Legion testified before the House Veterans’ Affairs Subcommittee on Economic Opportunity. Testimony was presented by, the Legion’s Economic Division. The American Legion stressed its support of pending House legislation that would make student veterans eligible for in-state tuition at public colleges and universities, regardless of their residency status.

The Legion supports passage of H.R. 357, the GI Bill Tuition Fairness Act of 2013, which would eliminate financial burdens that are now endured by about 40,000 nonresident student veterans. Since the Post-9/11 GI Bill only covers in-state tuition rates, veterans being charged out-of-state rates must make up the difference themselves. That difference can be quite substantial. For example, at Virginia Tech in Blacksburg, Virginia, in-state tuition for the 2012-2013 academic year is $10,923; out-of-state students pay $25,915 – about two and a half times as much. If enacted, H.R. 357 would reduce tuition costs for student veterans at Virginia Tech by about $15,000 per academic year. The Legion told the subcommittee that it has heard from many veterans who have had difficulties establishing state residency because of overseas deployments, permanent changes in duty stations, and other requirements of military service.

The Legion has been leading a state-by-state initiative to introduce and advocate for legislation that would make student veterans eligible for in-state tuition rates. Recent victories have been scored with legislatures in Indiana, Maryland, Missouri, and North Dakota. Ten states have passed laws to waive the residency requirement. In addition, another nine states have waived these [requirements] for some veterans and military family members through university-specific policy changes. Unfortunately, not all states or schools seem to recognize by their actions the necessity of fixing this problem. If enacted H.R. 357 would apply to all public U.S. colleges and universities that qualify for GI Bill funding. Student veterans would automatically qualify for in-state tuition rates in all 50 states. The American Legion pledged to the committee that it would put our full weight behind this important legislation, and encouraged the committee to aggressively pursue timely enactment.

The American Legion supports several other pending House bills that address economic issues for veterans:

• H.R. 562, the VRAP Extension Act of 2013, would extend funding for the Veterans Retraining Assistance Program (VRAP) so that veterans using the program are covered until the end of the 2014 spring semester;

• H.R. 631, the Servicemembers’ Choice in Transition Act of 2013, would replace the military’s Transition Assistance Program with the Transition Goals Plans Success program. Service members would attend week-long classes that would emphasize financial planning, job-hunting skills, and how military work skills can apply to the private sector;

• H.R. 844, the VetSuccess Enhancement Act, would extend the eligibility period for veterans with service-connected disabilities to enroll in certain Vocational Rehabilitation and Employment programs. The current 12-year eligibility period would be increased by five years, but The American Legion prefers that the time restriction be eliminated;

• H.R. 1305: This bill would provide clarification regarding eligibility for services under the Homeless Veterans Reintegration Program (HVRP). This is the only nationwide program that helps homeless veterans get back into the work force. Currently, the Department of Labor will not allow homeless veterans to participate in HVRP if they are living in a residence provided through the HUD-VASH voucher program. This bill would remove this restriction; and,

• A draft bill, entitled the Improving Job Opportunities for Veterans Act of 2013, would improve and increase on-the-job training and apprenticeship programs administered by the Department of Veterans Affairs for veterans, especially for non-managerial employees.

To learn more about the hearing and to view the archived webcast, click here.

House Armed Services Subcommittee Examines Mental Health Research

On April 10, the House Armed Services Subcommittee on Military Personnel held a hearing to examine the current status of military mental health research. Chairman Joe Wilson (SC) opened the hearing by noting government money has gone to fund nearly one thousand studies aimed at better understanding and treatment of mental health issues related to veterans. He then noted he was most interested to find out the extent to which these studies have contributed to better understanding at treatment of PTSD and TBI issues faced by veterans, and whether the sequester has had any negative results for progress in addressing these challenges. Ranking Member Susan Davis (CA) noted that it has been six years since there began to be increases in funding for this type of research, and she indicated she was interested in learning about the results.

The panel consisted of:

• Dr. Jonathan Woodson, Assistant Secretary of Defense for Health Affairs, Department of Defense (DOD)

• Lieutenant General Thomas W. Travis, Surgeon General, United States Air Force

• Vice Admiral Matthew L. Nathan, Surgeon General, United States Navy

• Lieutenant General Patricia D. Horoho, Surgeon General, United States Army

• Commander Russell B. Carr M.D., Service Chief, Adult Behavioral Health Clinic, U.S. Navy, Walter Reed National Military Medical Center at Bethesda

Dr. Woodson highlighted some of the efforts DOD is putting into dealing with these issues. They include:

• The fielding of a Traumatic Brain Injury and Related Disorders (TBIRD) Mobile Assessment Unit (MAU), which is "capable of extending neuropsychological assessment services and providing surge-related services to bases where there is an established need;"

• Behavioral Health Needs Assessment Survey (BHNAS), an assessment administered by the Naval Health Research Center (NHRC) for implementation by the Navy Mobile Care Teams (MCTs), "used to identify high-risk missions, develop counter-stress interventions that target specific missions and locations, direct research in operational stress, and provide in-theater estimates of the mental health need;" and

• A new study entitled the Impact of Marine Suicide on Family Survivors aimed at "examining the post-suicide adjustment and needs of Marine spouses and families. A portion of the study includes interviews with spouses to determine, if in retrospect, they may have seen signs, symptoms, or signals that their Marine spouse was at risk for self-harm."

When questioned as to the extent of the impact from sequestration, the panel members noted that it is a particularly difficult year from a budget point of view, given both the uncertainty of working from continuing resolutions, as well as the coming of the sequester. They noted they have often had to manage their finances on a month-to-month basis. Despite this, all agreed they have, and will continue to find, creative ways to deal with and overcome the constraints of the budget in order to make progress in this area.

Another area highlighted by LTG Horoho was the increasing focus on pinpointing risk factors in pre-deployment training and screening, in part by developing an integrated behavioral health portal which would fuse all data and information for each service member, making it available to commanders, clinicians, and providers.

House VA Subcommittee Examines National Cemeteries

On Wednesday, April 12, the House Veterans’ Affairs Subcommittee on Disability and Memorial Affairs (DAMA) conducted a hearing entitled "Sustaining the Sacred Trust: An Update on our National Cemeteries." The first panel of the hearing largely centered around the Honorable Steve Muro, Undersecretary for Memorial Affairs, chief of the Department of Veterans Affairs (VA) National Cemetery Administration (NCA). In addition to Mr. Muro, Kathryn Condon, Executive Director of the Army National Cemeteries Program provided an update on Arlington National Cemetery, and the Honorable Raymond Wollman, Deputy Secretary of the American Battle Monuments Commission (ABMC) provided updates on that body’s activities.

In contrast to other recent hearings with VA officials, the hearing was cordial and far from combative. Chairman Jon Runyan (NJ) singled out Director Condon for the astounding success of her efforts to turn around conditions over the past three years at Arlington, and thanked her for her exemplary efforts in that area as she prepared to move on from her position in the coming months. He and Ranking Member Dina Titus (NV) also commended Undersecretary Muro for NCA’s work in correcting gravesite errors discovered during recent audits, although Representative Titus did raise concerns about the lack of national cemeteries in a number of the western states. Mr. Muro stated he was willing to work with her office to explain the expansion plan and ensure that the needs of western veterans were being addressed.

Deputy Secretary Wollman was asked about concerns that the cemetery at Clarke Air Force Base in the Philippines, recently turned over to the jurisdiction of the ABMC, was not accepting burials of service members with service past 1947. Wollman stated that information was incorrect. Obviously it would be a point of concern as many of the veterans there who maintained the cemetery when there was no governmental stewardship would be ineligible for burial in the very cemetery they kept faith with if the rumors were correct. Wollman assured the committee no such proscription was in place.

Undersecretary Muro was questioned about a military spouse who had complained of problems with markers at the military cemetery of the Pacific in Punchbowl, Hawaii. Muro immediately apologized personally to the families of those affected, addressed thoroughly how the error had come to pass, took organizational responsibility for the error, and detailed the plans to make things right for the families, and to ensure through training how the individuals responsible would not be repeating the mistakes in the future. It was this sort of ownership of the failures and commitment to rectifying the missteps that drew praise not only from the subcommittee, but also from the second panel, which consisted of personnel from the Office of the Inspector General (OIG).

Linda Halliday, Assistant Inspector General for Audits and Evaluations with OIG spoke on their work with NCA to address issues with misplaced grave markers. The problem was initially discovered through internal NCA auditing, and OIG became involved as an outside evaluator of how they were dealing with the problems identified. Ms. Halliday noted that NCA had accepted all criticisms found and had complied with, or was in the process of complying with, every single one of the corrective measures for deficiencies noted. Halliday stated "[NCA] has made good faith efforts to address and fix all issues we uncovered in our study and evaluation." She continued, "Director Muro’s response was immediate and cooperative. This has not been the case with all VA leadership we have worked with, and we have worked with all levels of VA leadership."

The OIG representatives further stressed that although they found errors, NCA’s error rates were very low to begin with, and on top of that most of the errors were simple and easily correctable with minor steps.

American Legion Legislative Council

The Legislative Division continues the task of re-building the membership of the National Legislative Council for the 113th Congress. Council recommendation forms were emailed to Department leadership in December, asking for nominations for new congressional members. Completed forms were due in the Legislative Division offices in Washington, DC by January 18. To date, 46 Departments have returned their Council nomination forms. The Departments with the greatest congressional redistricting and turn over are still completing their assignments. The only Departments still working on their committee assignments are California, Connecticut, New York, and Ohio

The importance of the Legislative Council cannot be overstated. It is an especially important voice for The American Legion family, and the way in which members of Congress can be quickly contacted when legislative action is needed. Departments are urged to complete their nomination forms and return them to the Legislative Division offices as soon as possible.

Update on Flag Amendment Bill

On January 18, House Joint Resolution (H.J. Res.) 19 was introduced by Representative Jo Ann Emerson (MO). This legislation is a proposed constitutional amendment to protect the American flag from physical desecration. Its text states simply: "The Congress shall have power to prohibit the physical desecration of the flag of the United States."

The next task is finding cosponsors for this legislation. Please contact the offices of your representative and senators, and ask them to become cosponsors of the flag amendment in their respective chambers. [Res. 272-2012]