The Administration supports House passage of S. 1402 (text of H.R.
4268 as reported by the House Veterans' Affairs Committee), which would
make improvements to the Montgomery GI Bill (MGIB) veterans' education
assistance program. S. 1402 would increase the basic monthly benefit for
eligible veterans and active-duty personnel in the MGIB-Active Duty
program from $536 today to $600 in FY 2001 (12 percent) and then to $720
in FY 2003. The bill also would increase benefits for survivors and
dependents by 24 percent in FY 2001 and automatically increase these
benefits each year for the cost-of-living.
The Administration has offered an alternative to S. 1402 that
provides for a larger increase in the basic monthly benefit in the first
year. This proposal would increase the monthly benefit for eligible
veterans and active-duty personnel in the MGIB-Active Duty program from
$536 today to $670 in FY 2001 (25 percent) -- the largest single
increase in veterans' education benefits in the program's 16-year
history. The Administration's proposal would also: (1) provide this same
25 percent benefit increase for survivors and dependents and provide
automatic cost-of-living adjustments; and (2) make the benefit more
flexible by allowing veterans to use their benefits for licensing and
certification and during longer breaks between school terms. While we
support House passage of S. 1402, we will work with the Congress to seek
consideration of our alternative proposal.
Improvements like these are essential to ensuring that veterans and
their survivors and dependents can afford higher education or
professional training. Recent surveys indicate that education assistance
is an important reason why young men and women join the service, and
these benefits contribute to service members' completing their first
tour of active duty. However, the current MGIB program does not reflect
the Nation's growing reliance on non-traditional methods of learning and
increased focus on high-tech training. The Administration looks forward
to working with the Congress to enact these improvements.
Pay-As-You-Go Scoring
S. 1402 would affect direct spending and receipts; therefore, it is
subject to the pay-as-you-go requirement of the Omnibus Budget
Reconciliation Act (OBRA) of 1990. OMB's preliminary scoring of this
bill as ordered reported by the House Veterans' Affairs Committee is
that it would result in net costs of $116 million in FY 2001, $134
million in FY 2002, and a total of $78 million in FYs 2001-2005. Final
scoring of this bill will be issued seven days after enactment, as
required by OBRA. The bill does not contain provisions to fully offset
the net budget costs in FYs 2001 and 2002. As a result, if the bill were
enacted without any further action to provide offsets, it could
contribute to a sequester of mandatory spending. The Administration
supports House passage of this bill and will work with Congress to
ensure that such an unintended sequester does not occur.
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