Congresswoman’s bill will allow service members to renegotiate overpayment repayments
WASHINGTON, DC – Today, Congresswoman Carol Shea-Porter introduced the Military Overpayment Fairness Act of 2009. The legislation would reform an unfair and inflexible payment schedule that often causes undue financial hardship for our nation’s services members.
“Our nation’s service members should not suffer financially because of bureaucratic mistakes,” said Congresswoman Shea-Porter. “My bill will allow service members who are erroneously overpaid to renegotiate their repayments and reduce their payment rate. I wrote this legislation to ease financial burdens on the brave men and women in uniform who serve our country with honor and distinction.”
Payment errors are common in all military branches, but are especially prevalent among the Reserves and Guard because of their frequent duty status changes. When an overpayment does occur, there is little flexibility for service members to negotiate repayment rates because the Defense Finance and Accounting Service expects rapid repayment of the full amount.
The Military Overpayment Fairness Act would require the Department of Defense (DOD) to negotiate the terms of repayment with service members, taking into account their finances, to avoid causing undue hardship.The bill states that not more than 10% of a service member’s pay can be deducted monthly to repay the overpayment unless the service member chooses to pay at a higher rate.Additionally, the bill requires a delay in collecting from wounded or ill service members, or from deployed service members.
Inflexible repayment rates for military personnel and retirees have been of deep concern to Congresswoman Shea-Porter. Last month, the Congresswoman took action on a different pay issue when she introduced the Military Retirement Pay Fairness Act of 2009 to protect veterans from facing financial hardship when required to repay separation benefits to the DOD. That legislation would reform an unnecessarily harsh formula that requires the DOD to aggressively recoup separation benefits previously paid to service members, regardless of whether the formula would cause severe financial hardship.