[House Hearing, 110 Congress]
[From the U.S. Government Printing Office]




 
                 EDUCATION BENEFITS FOR NATIONAL GUARD
                      AND RESERVE MEMBERS OF THE
                           U.S. ARMED FORCES

=======================================================================

                                HEARING

                               before the

                  SUBCOMMITTEE ON ECONOMIC OPPORTUNITY

                                 of the

                     COMMITTEE ON VETERANS' AFFAIRS
                     U.S. HOUSE OF REPRESENTATIVES

                       ONE HUNDRED TENTH CONGRESS

                             FIRST SESSION

                               __________

                             MARCH 22, 2007

                               __________

                           Serial No. 110-10

                               __________

       Printed for the use of the Committee on Veterans' Affairs

                    U.S. GOVERNMENT PRINTING OFFICE
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                     COMMITTEE ON VETERANS' AFFAIRS

                    BOB FILNER, California, Chairman

CORRINE BROWN, Florida               STEVE BUYER, Indiana, Ranking
VIC SNYDER, Arkansas                 CLIFF STEARNS, Florida
MICHAEL H. MICHAUD, Maine            JERRY MORAN, Kansas
STEPHANIE HERSETH, South Dakota      RICHARD H. BAKER, Louisiana
HARRY E. MITCHELL, Arizona           HENRY E. BROWN, JR., South 
JOHN J. HALL, New York               Carolina
PHIL HARE, Illinois                  JEFF MILLER, Florida
MICHAEL F. DOYLE, Pennsylvania       JOHN BOOZMAN, Arkansas
SHELLEY BERKLEY, Nevada              GINNY BROWN-WAITE, Florida
JOHN T. SALAZAR, Colorado            MICHAEL R. TURNER, Ohio
CIRO D. RODRIGUEZ, Texas             BRIAN P. BILBRAY, California
JOE DONNELLY, Indiana                DOUG LAMBORN, Colorado
JERRY McNERNEY, California           GUS M. BILIRAKIS, Florida
ZACHARY T. SPACE, Ohio               VERN BUCHANAN, Florida
TIMOTHY J. WALZ, Minnesota

                   Malcom A. Shorter, Staff Director

                                 ______

                  Subcommittee on Economic Opportunity

              STEPHANIE HERSETH, South Dakota, Chairwoman

JOE DONNELLY, Indiana                JOHN BOOZMAN, Arkansas
JERRY McNERNEY, California           RICHARD H. BAKER, Louisiana
JOHN J. HALL, New York               JERRY MORAN, Kansas

Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public 
hearing records of the Committee on Veterans' Affairs are also 
published in electronic form. The printed hearing record remains the 
official version. Because electronic submissions are used to prepare 
both printed and electronic versions of the hearing record, the process 
of converting between various electronic formats may introduce 
unintentional errors or omissions. Such occurrences are inherent in the 
current publication process and should diminish as the process is 
further refined.


                            C O N T E N T S

                               __________

                             March 22, 2007

                                                                   Page
Education Benefits for National Guard and Reserve Members of the 
  U.S. Armed Forces..............................................     1

                           OPENING STATEMENTS

Chairwoman Stephanie Herseth.....................................     1
    Prepared statement of Chairwoman Stephanie Herseth...........    34
Hon. John Boozman, Ranking Republican Member.....................     2
    Prepared statement of Congressman Boozman....................    34
Hon. Jerry McNerney..............................................     6
Hon. Jerry Moran.................................................     7

                               WITNESSES

U.S. Department of Defense, Hon. Craig W. Duehring, Principal 
  Deputy Assistant Secretary of Defense for Reserve Affairs......     3
    Prepared statement of Mr. Duehring...........................    35
U.S. Department of Veterans Affairs, Keith M. Wilson, Director, 
  Education Service, Veterans Benefits Administration............     5
    Prepared statement of Mr. Wilson.............................    37

                                 ______

Arkansas National Guard, Major General William D. Wofford, 
  Adjutant General...............................................    19
    Prepared statement of Major General Wofford..................    39
Military Officers Association of America, Colonel Robert F. 
  Norton, USA (Ret.), Deputy Director, Government Relations......    22
    Prepared statement of Colonel Norton.........................    41
National Guard Bureau, Major General Terry L. Scherling, 
  Director, Joint Staff..........................................    18
    Prepared statement of Major General Scherling................    39

                       SUBMISSIONS FOR THE RECORD

American Legion, Joseph C. Sharpe, Jr., Deputy Director, Economic 
  Commission, statement..........................................    46
Bartlett, Hon. Roscoe G., a Representative in Congress from the 
  State of Maryland, statement...................................    49
Carney, Hon. Christopher P., a Representative in Congress from 
  the State of Utah, statement...................................    49
Matheson, Hon. Jim, a Representative in Congress from the State 
  of Utah, statement.............................................    50
Reserve Officers Association and Reserve Enlisted Association, 
  joint statement................................................    50
South Dakota National Guard, Major General Michael A. Gorman, 
  State Adjutant General and Secretary, South Dakota Department 
  of Military and Veterans Affairs, statement....................    51


                 EDUCATION BENEFITS FOR NATIONAL GUARD
                       AND RESERVE MEMBERS OF THE
                           U.S. ARMED FORCES

                              ----------                              


                        THURSDAY, MARCH 22, 2007

             U.S. House of Representatives,
                    Committee on Veterans' Affairs,
                      Subcommittee on Economic Opportunity,
                                                    Washington, DC.

    The Subcommittee met, pursuant to notice, at 2:05 p.m., in 
Room 340, Cannon House Office Building, Hon. Stephanie Herseth 
[Chairwoman of the Subcommittee] presiding.

    Present: Representatives Herseth, McNerney, Boozman, and 
Moran.

    Also Present: Representative Snyder.

            OPENING STATEMENT OF CHAIRWOMAN HERSETH

    Ms. Herseth. Good afternoon. The Veterans' Affairs Economic 
Opportunity Subcommittee hearing on the Education Benefits for 
National Guard and Reserve Members will come to order.
    Before I begin, I would like to call attention to the fact 
that several individuals interested in today's hearing have 
asked to submit a written statement for the record. If there is 
no objection, I ask for unanimous consent that those statements 
which have been submitted by the following be allowed to be 
inserted for the record:
    Major General Michael A. Gorman, State Adjutant General, 
South Dakota National Guard; Mr. Joseph C. Sharpe, Jr., The 
American Legion; Reserve Officers Association and Reserve 
Enlisted Association; Congressman Jim Matheson who represents 
the 2nd District in Utah; Congressman Roscoe Bartlett, who 
represents Maryland's 6th District; and Congressman Christopher 
Carney representing Pennsylvania's 10th District.
    With no objection, those statements will be entered.
    As the lone representative from South Dakota, which this 
year will have about 2,000 veterans using GI Bill payments for 
their education, I have an especially strong interest in 
exploring options to improve and modernize the Montgomery GI 
Bill, particularly for National Guard and Reserve 
servicemembers.
    Ranking Member Boozman, I look forward to working with you 
as we did in the last Congress, and all the Members of the 
Subcommittee, as well as our colleagues on the Armed Services 
Committee to update this important program.
    Since the Montgomery GI Bill was enacted more than 20 years 
ago, our Nation's utilization of the Selected Reserve Forces 
has dramatically increased.
    When the MGIB was signed into law in 1984, servicemembers 
of the Guard and Reserve were rarely mobilized, and that is 
simply not the reality today. Indeed, today's citizen soldiers 
are serving with distinction and have sacrificed a great deal 
in our efforts in Iraq and Afghanistan.
    Unfortunately, although they are being called to duty and 
mobilized for extended periods of time, their educational 
benefits do not reflect their increased service to the nation. 
These patriots have earned and deserve high-quality education 
and training benefits to be used in a fair and equitable 
manner.
    I would also like to welcome all of today's witnesses, and 
I very much appreciate your testimony as your views and 
insights are critically important as we go about examining this 
issue.
    I am particularly interested in understanding and exploring 
the views and perspectives on the proposed Total Force GI Bill. 
This proposal would, among other things, organize all GI Bill 
programs under Title 38 and provide a ten-year portability of 
Chapter 1607 benefits.
    I believe these concepts would help reflect the reality of 
the total force policy. However, I understand there may be 
concerns about how this proposal may affect retention, so I 
look forward to hearing from our witnesses.
    Much progress has been made in education benefits for 
National Guard and Reserve members. However, I think everyone 
would agree that we must remain vigilant to maintain against 
any decline in benefits.
    Veterans, servicemembers, and military families of this 
Nation deserve our best efforts, and I plan on working with my 
colleagues to examine and develop policies aimed to improve 
readjustment services for our men and women in uniform.
    Thank you again for being here today.
    I now recognize our Ranking Member, Mr. Boozman, for any 
opening remarks he may have.
    [The statement of Chairwoman Herseth appears on pg. 34.]

             OPENING STATEMENT OF HON. JOHN BOOZMAN

    Mr. Boozman. Thank you, Chairman Herseth, and thank you for 
bringing this matter up in light of the recent scheduling of 
the joint hearing with Chairman Snyder's Subcommittee and with 
the events at Walter Reed that have since been discovered.
    Today we will hear from several witnesses on modernizing 
the GI Bill, especially as those benefits apply to members of 
the National Guard and Reserves.
    As you know, Chairman Snyder, I look forward to working 
with you in providing fair treatment for those who defend us. 
That will not be an easy task. Today's hearing is an important 
part of that process.
    I suppose my basic approach is not to retain someone that 
you do not recruit for military service. Hopefully once someone 
joins, aspects of military patriotism will convince members to 
stay regardless of benefits.
    Those who choose to leave, we should be wise enough to 
thank them profusely for their service and make them aware that 
they are always welcome back.
    Of course, none of us on this Committee can ignore the 
fiscal realities facing Congress. We have to be conscious of 
how we spend taxpayers' money, but we must make sure we provide 
what is needed to continue to attract good people in military 
service. I believe levels of benefits is what is needed to 
improve and retain members.
    Madam Chairman, I am looking forward to hearing from 
today's witnesses, including Major General Wofford, the 
Adjutant General of the Arkansas National Guard, who we are 
very proud of.
    And, again, General, like I told you earlier, I really 
appreciate your testimony, not just because you are from 
Arkansas, but you do a very, very good job, but I really look 
forward to your testimony.
    Again, thank you for testifying, and I look forward to 
continuing to work with the Chairman and the Subcommittee on 
these very important issues.
    [The prepared statement of Congressman Boozman appears on 
pg. 34.]
    Ms. Herseth. Thank you, Mr. Boozman.
    Our distinguished panel is well-qualified to discuss these 
issues today.
    Joining us on our first panel is the Honorable Craig 
Duehring, Principal Deputy Assistant Secretary of Defense for 
Reserve Affairs of the U.S. Department of Defense and Mr. Keith 
Wilson, Director of Education Service for the U.S. Department 
of Veterans Affairs.
    After the first panel is finished giving their testimony, 
other Members of the Subcommittee will be recognized for 5 
minutes to make opening remarks and to ask questions.
    As you were informed prior to the start of the hearing, we 
may have votes called at any time, so we will just go ahead and 
start. I think we should be able to get through both the 
testimony of Mr. Duehring and Mr. Wilson.
    Mr. Duehring, let us begin with you.

    STATEMENTS OF HON. CRAIG W. DUEHRING, PRINCIPAL DEPUTY 
   ASSISTANT SECRETARY OF DEFENSE FOR RESERVE AFFAIRS, U.S. 
DEPARTMENT OF DEFENSE; AND KEITH M. WILSON, DIRECTOR, EDUCATION 
 SERVICE, VETERANS BENEFITS ADMINISTRATION, U.S. DEPARTMENT OF 
                        VETERANS AFFAIRS

              STATEMENT OF HON. CRAIG W. DUEHRING

    Mr. Duehring. Thank you, Madam Chairwoman.
    Chairwoman Herseth, Ranking Member Boozman, and Members of 
the Subcommittee, thank you for the opportunity to discuss the 
educational assistance programs available to our Guard and 
Reserve members and the potential effects of changes to those 
programs.
    This is an unprecedented time for the all-volunteer force. 
We are at war. But unlike World War II, the Korean war, and 
Vietnam when many of the people who served in the military were 
drafted, today they make an informed decision to join the 
military.
    We are proud of the men and women who volunteer to serve 
our great country. They do so knowing there is a rich suite of 
benefits they will earn by virtue of their military service.
    We also know that we face constant challenges to maintain 
an all-volunteer force. We must be able to offer an incentive 
package that competes favorably with the private sector.
    The Montgomery GI Bill for the Selected Reserve helps us 
attract high-quality recruits. The recently enacted Reserve 
Education Assistance Program, REAP, which was created 
specifically to provide a richer benefit to Reserve component 
members who answered the call to duty, helps us retain our 
Guard and Reserve members who have proven themselves in combat.
    Our most recent survey shows us that most Reservists do not 
begin a new career when they are released from active duty 
unlike their active-duty counterparts. Eighty percent of 
Reservists were employed full time when activated. Twenty-six 
percent were enrolled in school.
    Certainly reintegration and readjustment are important to 
our citizen soldiers, particularly the 28 percent who reported 
that they did not return to the same employer and the 8 percent 
who were not in the workforce when mobilized.
    Guard and Reserve members can use the REAP benefit to train 
for a new career as they transition back to civilian life or 
advance in their current career.
    We do not believe that the continued service requirement is 
onerous since the first couple of years following mobilization 
are also the years when the demands to perform Reserve service 
are at their lowest under the Services Force generation models.
    At the hearing last fall on this same subject, the 
Committee heard testimony urging Congress to combine the two 
Reserve educational assistance programs into a single program 
under the Department of Veterans Affairs.
    There is obvious merit in making educational assistance 
programs transparent to students and educational institutions 
and simplifying the administration of the programs for VA.
    But the Department is deeply concerned about changes to the 
Reserve programs that would affect the retention outcomes we 
hope to achieve with these programs.
    To maintain the all-volunteer force, the Department needs a 
variety of incentives to meet its force management objectives. 
That is why we find the retention aspect of the Reserve 
Educational Assistance Program such an important attribute.
    Half of those who serve in the Selected Reserve today have 
completed their initial military service obligation. Even among 
those who are still within their initial 8-year military 
service obligation, many have no obligation to serve in the 
Selected Reserve. They can complete their military service in 
the Individual Ready Reserve.
    This is why we are so intent on incentives being tied to 
service in the Selected Reserve. We need incentives that 
encourage our Guardsmen and Reservists to stay with us, not to 
leave.
    Madam Chairwoman, we have given a great deal of thought to 
educational programs and changes that would improve the 
programs while continuing to assist the Department in meeting 
its force management objectives.
    In the short time since that hearing last fall, we were 
able to include two modest legislative proposals in the 
Department's 2008 legislative program.
    The first would allow Selected Reserve members to retain 
their REAP eligibility indefinitely while in the Individual 
Ready Reserve rather than losing eligibility after 90 days.
    The second would allow Selected Reserve members who are 
separated due to the draw-down to retain MGIB Selected Reserve 
eligibility until the delimiting date just as we did during the 
force drawn-down in the 1990s.
    We have also been working closely with VA to identify 
changes to the educational assistance programs that improve 
those programs while not undermining retention. That work is 
still ongoing.
    Madam Chairwoman, we also want to work with you and this 
Committee to see if we can find a way to balance retention with 
providing our combat-proven Guardsmen and Reservists a benefit 
that meets their needs for reintegration and readjustment.
    I would again like to thank the Committee for all it has 
done for our men and women who serve our great country.
    [The statement of Mr. Duehring appears on pg. 35.]
    Ms. Herseth. Thank you, Mr. Duehring.
    Mr. Wilson.

                  STATEMENT OF KEITH M. WILSON

    Mr. Wilson. Thank you.
    Good afternoon, Chairwoman Herseth, Ranking Member Boozman, 
and Members of the Subcommittee. I appreciate the opportunity 
to appear before you today to discuss the two educational 
programs administered by the Department of Veterans Affairs for 
National Guard as well as Reserve members, mainly the 
Montgomery GI Bill Selected Reserve and the REAP, Reserve 
Educational Assistance Program.
    The education claims processing workload for the MGIBSR 
increased steadily from 2001 until 2006. In 2006, VA received 
more than 261,000 Selected Reserve benefit claims and 68,000 
REAP benefit claims.
    Through the end of February fiscal year 2007, we have 
received 98,000 Selected Reserve benefit claims as well as 
52,000 REAP benefit claims.
    Comparing fiscal year 2006 through February to the same 
period in fiscal year 2007, claims for Reservist benefits under 
both programs have increased 27 percent.
    The Department of Defense has informed us that between 1986 
and 2006, more than 1.5 million Selected Reserve members gained 
eligibility to MGIB Selected Reserve benefits. Forty-two 
percent of them have applied for educational assistance.
    In fiscal year 2006, over $122 million in benefits were 
paid to over 66,000 Selected Reserve members participating in 
the Selected Reserve Program. In fiscal year 2006, over $153 
million in benefits was paid to almost 24,000 REAP 
participants.
    Through the end of February fiscal 2007, over $71 million 
in benefits were paid to more than 43,000 Selected Reserve 
members participating in the 1606 program and over $93 million 
paid for 28,000 participants in the REAP program.
    Timeliness has improved for supplemental claims processing. 
Average days to complete Selected Reserve supplemental claims 
dropped from 20 days in fiscal 2006 to 17 days through February 
of fiscal 2007. Similarly, average days to complete REAP claims 
has dropped from 19 days in 2006 to 17 days in 2007, again for 
supplemental claims.
    Timeliness likewise has improved for original claims 
processing. Average days to complete Selected Reserve original 
claims decreased from 35 days in 2006 to 29 days through 
February of this fiscal year. Average days to complete REAP 
original claims dropped from 60 days in 2006 to 42 days through 
February of this fiscal year.
    Expanded outreach has led to increased benefit usage. We 
have distributed more than 300,000 copies of our new REAP 
brochure to activated Guard and Reserve units nationwide. We 
have also prepared 46,000 REAP DVDs which are going to be 
distributed to Reserve units across the country. The goal is to 
have informational disks distributed to all units by the end of 
this month, March of 2007.
    Additionally, we will soon begin direct mailings of REAP 
informational material to activated Guard and Reserve members 
just as we now do for Chapter 30 participants.
    We continue our efforts to migrate all claims processing 
from the Legacy claims processing system into our new VA 
corporate environment. The Education Expert System known as 
TEES has a multi-year initiative that when fully deployed will 
electronically receive and process application and enrollment 
information. TEES will enable us to improve processing for 
timeliness as well as quality of decisionmaking.
    Madam Chairman, this concludes my statement. I would be 
pleased to answer any questions you or other Members of the 
Subcommittee may have.
    [The statement of Mr. Wilson appears on pg. 37.]
    Ms. Herseth. Thank you both for you testimony. I have a 
number of questions, but I am going to defer to Mr. Boozman if 
he wants to start or we can recognize Mr. McNerney and Mr. 
Moran for opening statements.
    Okay. Mr. McNerney, would you like to begin either with an 
opening statement or questions for the panel?

            OPENING STATEMENT OF HON. JERRY McNERNEY

    Mr. McNerney. Thank you Madam Chair and Ranking Member 
Boozman. I appreciate the opportunity to be here and to listen 
to the testimony.
    We just went through sort of a trauma with the Department 
of Veterans Affairs and the hospital at Walter Reed. And I know 
what you are going to answer to this question, but I just want 
to put it out there.
    Are there any cockroaches under the table? I mean, if you 
look at Walter Reed, we see from the top level, it looks good 
and there were not any problems. But underneath it took someone 
to go in there and scour that system to find the problems.
    Is there anything underneath that we are missing here that 
we are going to get a nasty surprise on later? And I do not 
suspect that there is. I do not have any reason to suspect 
that, but I am just a little on edge now because of that 
experience.
    And I recommend that you take the time to go down into the 
details of the system and make sure there are not any nasty 
surprises in your Administration.
    Thank you.
    Mr. Wilson. I can address that very briefly. We are 
fortunate in a couple respects actually. In terms of the 
education benefits, administering those benefits, we have got a 
very effective relationship with the Department of Defense and 
most of the information that we need concerning eligibility, 
what we need to administer the program, is fed to us directly 
from DOD as data.
    So in terms of having, in your word, cockroaches under the 
carpet, we are not aware of any, but certainly we are always 
vigilant, and we will continue to look and make sure that we 
are doing what we need to.
    Mr. Duehring. Can I mention something as well? From our 
perspective, both my boss, the Assistant Secretary of Defense 
for Reserve Affairs, Thomas Hall, and I travel the country 
constantly, many times every month, usually trying to meet with 
soldiers, sailors, airmen, Marines, Coast Guardsmen, wherever 
we can find them, and the venue that we use is a town hall type 
format.
    After visiting the unit, we say, okay, everybody here, let 
us talk. What is going on, what are your concerns? And we get a 
pretty accurate feeling for if there are problem areas.
    A few years ago, TRICARE was a big issue for us. We have 
been able to address that and we see the interest level going 
down.
    The education program is a popular program. It is very much 
appreciated, but we have not seen anything right now that 
indicates that we have a recurring problem. I feel very 
comfortable that we have a good system in place.
    Mr. McNerney. I yield.
    Ms. Herseth. The gentleman yields back.
    Mr. Moran, you are recognized.

             OPENING STATEMENT OF HON. JERRY MORAN

    Mr. Moran. Madam Chairman and Ranking Member, thank you 
very much for holding this hearing.
    Just from a personal perspective as a Member of Congress, 
my highest priority this year is to see that we begin the 
process of reevaluating our Guard and Reserve components and 
the benefits that they receive, and clearly education is one of 
those, but healthcare, retirement.
    As we have seen the increasing demands placed upon those 
who serve in our Reserve components and our National Guard 
units, it has become very clear to me that the distinction that 
we have often made between active military and Guard and 
Reserve is a lot less clear.
    And, again, the benefits that we provide those who serve 
our country, we should reduce the areas in which we 
discriminate against Guard and Reserve. So I am delighted to be 
here and listen to the testimony.
    And I have no questions of these witnesses, but I do think 
that this hearing is important as we begin the process of 
trying to what I consider right some wrongs as we take care of 
those who serve just in a slightly different capacity than our 
active military.
    So I thank you and Mr. Boozman for your leadership in this 
regard and know that you have legislation pending that I am a 
sponsor of. And e look forward to working with you. I thank you 
for that.
    Ms. Herseth. We appreciate your partnership with us and the 
legislation that we have reintroduced in this Congress and 
other items that we are examining.
    Mr. Boozman, I am sure you have some questions.
    Mr. Boozman. The bill that Mr. Snyder has on the table that 
Mr. Moran just alluded to that we are sponsors of, it really 
has two components. One component is moving the GI Bill into 
one unit as opposed to being split by DOD and Veterans.
    Do you guys, either one, do you have any comments about 
that? What are your feelings about joining it together as 
opposed to having its jurisdictions in different places?
    Mr. Wilson. The notion of bringing everything under Title 
38, I think, is intriguing or attractive from one respect, but 
we do have some concerns that we would be bringing items into 
Title 38 that from a VA perspective, we do not feel we are best 
suited to address.
    For example, ``Kickers.'' ``Kickers'' are something that 
really is a force management tool that DOD uses. The current 
piece of legislation would bring a VA role into the 
``Kickers,'' and that is something that I do not think is or we 
are feeling is not necessarily appropriate for our role.
    Mr. Boozman. Mr. Duehring?
    Mr. Duehring. Well, we would share that same concern. The 
difference, of course, is that we treat the educational 
benefits for the Reserve programs as an incentive. And in the 
other case for the veterans, it is an entitlement. It changes 
the way it is funded. It changes the decisionmaking process of 
when to use it, should we increase it, should it be changed, 
again trying to achieve a desired goal.
    They look a lot alike, like I would say oranges and 
tangerines, but they are, in fact, a different fruit. And I 
think we have a very good system that we are working well with. 
It needs some tweaking from time to time, and we are happy to 
work with your staff to make those changes.
    Mr. Boozman. Very good. You mention that you do use it as 
an incentive. Has there been any cost benefit studies done to 
determine the effects of the benefit as far as its intent in 
what it is trying to do? I mean, do you have any evidence, any 
studies that you have come up with as to what effect it is 
having?
    Mr. Duehring. Recently as I was preparing for this 
testimony today, I asked about some of the surveys that we have 
done. And when I scanned through them, and, of course, they 
parsed them out into different age groups and levels of 
experience, and I looked in there, you know, what is important 
to you for recruiting, retention, so on and so forth.
    And I found that by and large education fell right in the 
middle of the pack. If you got to younger people, it started 
moving up. As you got older people, of course, not surprisingly 
it moved down. Single people, it moved up. Married people, it 
moved down. But as I recall there were 17 possible choices and 
it came out as number nine, right in the middle, or one or two 
on either side in every single case.
    As far as an analysis, a cost analysis, I am not aware of 
that, although there may be. If you would like, I would be 
happy to take that back and provide you with an answer later 
on.
    [The following was subsequently received from Mr. 
Duehring:]

          The Department has not conducted a study specifically looking 
        at the marginal effects of the Montgomery GI Bill--Selected 
        Reserve (MGIB-SR) educational benefits on recruiting and 
        retention. We do know that in response to recent surveys asking 
        Selected Reserve members about the factors that influenced 
        their decision to affiliate with the Selected Reserve and their 
        decision to remain in the Selected Reserve, education 
        assistance benefits rank quite high.
          The primary concern of the Department is that moving 
        authority for the MGIB-SR to title 38, and responsibility for 
        the program to the Department of Veterans Affairs will change 
        the emphasis of the program from a recruiting and retention 
        incentive to a post-service (veterans') benefit and the 
        requirement for continued Selected Reserve membership will be 
        eliminated. We know, from the preliminary results of a recent 
        analysis by the RAND Corporation as part of an ongoing study 
        for the Department of Defense, that removal of the requirement 
        to remain in the Selected Reserve for continued benefits under 
        that program would have a negative effect on retention, and 
        would require significant increases in recruiting or other 
        retention incentives to make up for increased attrition. The 
        preliminary assessment of RAND estimates that permitting 
        transportability of benefits--permitting the use of MGIB-SR 
        benefits following separation from the Selected Reserve--
        projects that it would increase attrition by 10 percent among 
        Selected Reserve members with no prior active duty service. 
        Aside from the training cost associated with replacing trained 
        personnel who separate, RAND estimated that it would take a 10-
        percent increase in recruiting bonus expenditures to gain a 1 
        percent increase in accessions. This fact demonstrates that the 
        Department will need to spend a significant amount in other 
        incentive programs to counteract the negative effects of 
        allowing portability under the MGIB-SR program while continuing 
        to provide an education benefit to those who would have 
        otherwise remained in the Selected Reserve.

    Mr. Boozman. Thank you.
    Mr. Wilson, in your recent testimony before the Armed 
Services Subcommittee on Personnel, you described a certain 
tension between domestic veterans' programs and force structure 
issues that may result if the Centers of Education programs are 
transferred to Title 38, and, you know, we have alluded to that 
just now, from Title 10.
    Can you expand even more so as to be specific?
    Mr. Wilson. I will do my best. Friction perhaps is not the 
best term, but what I am attempting to describe is the mission 
essentially that VA has of caring for the veteran as they 
readjust into society and the mission that the Department of 
Defense has with keeping us all safe.
    From a very broad perspective, those are the frictions that 
I was talking about, and bringing items from Title 10 into 
Title 38 that could create offsetting needs or offsetting goals 
under one title would be very difficult. And we do not want to 
create a situation where, for instance, DOD and VA in the 
instance of Kickers that I gave would be at odds when we are 
both desiring to administer both programs or all of our 
programs the best we can.
    But in terms of the Kicker instance, we would be required 
to sit around the table and actually reach agreement on certain 
things.
    Our mission of taking care of the veterans in a situation 
like that would be different than their mission, and those 
would be the type of things that would have to be worked out. 
And friction was the term that I used for that.
    Mr. Boozman. I know I have used my time. Can I ask one more 
thing?
    I guess as I was sitting here, one of the things that we 
have run into as we come on the base in so many different 
instances, do you all feel comfortable that our Guard and 
Reserve really understands the benefit that they have?
    Mr. Duehring. Yes.
    Mr. Boozman. We run into that all the time. Like I said, a 
lot of times, people do not hear about these things after they 
are recruited. And I do not mean that in a bad way. My dad was 
a recruiter in the Air Force. But go ahead if you would.
    Mr. Duehring. Very much so. Of course, the National Guard 
and each of the Reserve organizations have different ways of 
approaching their people. But this is not the only issue that 
we have been asked questions like this on, whether it was a 
benefit, again going back to medical benefits, family programs, 
so on and so forth.
    We have scrubbed and rescrubbed our programs to make sure 
that individuals during the recruiting process, during the 
demobilization process are afforded every chance to learn about 
anything that might be of interest to them.
    We have documents. We have Web sites, of course, if they 
think about it later on. They want to ask questions, we have 
the One Source, the military One Source, a myriad of ways that 
we can get the information to the individuals. And I am very 
confident that they do know about it because of the responses 
that we get back, that they do consider it important.
    And it might be a good question perhaps to ask some of our 
experts on the second panel to find out what they have done as 
an example in their own units. I think it would be very 
enlightening because they have very good programs.
    Mr. Boozman. And I will submit this or whatever. When can 
we expect the legislative proposal from joint VA, DOD Council? 
The GI Bill Working Group, do we have any idea as to when that 
is going to happen?
    Mr. Wilson. They are very close to completing their work. 
The only issue that remains is developing an understanding of 
the impact on recruitment and retention of the alternatives 
that the working group originally proposed.
    I know just from a broad perspective that that issue is 
being worked largely within DOD, and I will have to provide 
more detailed information back to you.
    Mr. Boozman. Thank you.
    Ms. Herseth. Thank you, Mr. Boozman.
    It is true, Mr. Wilson, that in the testimony you gave to 
the Armed Services Committee or I think even the written 
statement you provided, the reason, as you just stated, that we 
do not have the report from the working group is because of the 
analysis on the impact on recruitment and retention.
    So given that we were supposed to have those findings in 
September of last year, we were then told it was going to be 
completed in October of last year. I understand we are close. 
How close are we?
    I think it is important that we at least have a date given 
to us today to shoot for and have an understanding as to what 
it is. Maybe you can answer or, Mr. Duehring you can, to what 
precisely DOD is analyzing to provide us this information.
    Mr. Wilson. Unfortunately, neither of us are aware of the 
specific details concerning where the working group is at with 
that part of the analysis. I would be reluctant to provide a 
specific date today.
    What I can commit to is providing a date within the next 10 
days, once I have the opportunity to go back with the working 
group and find out a little bit more information and give you a 
date from that point, if that is acceptable.
    Ms. Herseth. If you could get it to us by next Friday. As 
you know, there is a two-week district work period. It would be 
helpful for us to know prior to going back to our districts 
when we can expect that. Hopefully sometime when we return in 
April.
    Thank you.
    [The following was subsequently received from Mr. Wilson:]

        Education Service: Timetable for the DOD/VA working group 
        report on the Total Force GI Bill?

          The Joint Executive Council was presented with findings from 
        the Total Force Working Group in January and did not believe it 
        was ready to be released. They desired that the impact on 
        recruitment and retention be addressed. We are unable to 
        provide a date by which the final report will be provided from 
        the Secretary of Veterans Affairs to the Veterans Advisory 
        Committee on Education.

    Ms. Herseth. We have been joined by Dr. Snyder, who is a 
Member of the full Veterans' Affairs Committee as well as the 
Armed Services Committee, and conducted the Subcommittee 
hearing not too long ago in probing some of what we are probing 
here today.
    I think one of the issues that was the subject of some 
questioning with the Armed Services Subcommittee that I would 
like to probe a little bit because it goes to the issue that 
you mentioned, Mr. Wilson--the expanded outreach that has been 
done to inform servicemembers in the Guard and Reserve of their 
benefits, and addresses something, Mr. Duehring, that you said 
when you have townhalls and try to gauge where some concern is.
    I have been picking up more concern in meetings that I have 
had over the last four to 6 weeks both with folks at the State 
government level that work with State Approving Agencies and 
that work with other individuals who are just more comfortable 
going to them to help find information and work with the folks 
down in St. Louis as well as two National Guardsmen that I had 
coffee with just last weekend about how their education 
benefits were working for them.
    There seems to be some confusion, a significant degree of 
confusion in some of what I have been hearing that I am afraid 
may lead to a reservoir of resentment if we do not address it 
quickly here. The issue of how the amount of time that a 
National Guardsman or Reservist accumulates during active-duty 
deployment and how that may be transferred to affect their 
Chapter 1606 benefits after they have left the National Guard 
or Reserve.
    There seems to be some confusion, and everyone, I think, in 
the room is probably familiar with the Military.com article 
from the end of January.
    Mr. Duehring, you had mentioned at the beginning kind of 
the benefit of having this transparency of education benefits, 
and I would argue consistency of interpretation for eligibility 
of those benefits.
    If you both could address the following questions. May a 
Reservist veteran who separates after successfully completing 
his contract defer the start date for using the 1606 extension 
benefit and, if so, for how long?
    Mr. Wilson. The issue of the 1606 delimiting date has been 
an issue that does cause confusion, and I will make a brief 
comment in a general term. I agree with the statement that the 
Guard, Reservist, and active-duty individuals do know about the 
benefits from a broad perspective.
    The details, I think, are more difficult to get across to 
individuals, and I think one example of that is this portion.
    The amount of time that an individual can use their 1606 
benefits following separation from the Guard or Reserve, if 
they are activated, their delimiting date for use of those 
benefits is extended for a time equal to the time that they 
were on active duty plus 4 months. And that extension goes from 
the time that their normal delimiting date would occur.
    So the extension of the delimiting date occurs at 
separation, so there is no additional time beyond that 
delimiting date for which the clock starts at separation. In 
other words, for lack of a better term, there is not 
portability as we normally think of it in active-duty Chapter 
30 Program where you have a 10-year period.
    It is not as if an individual has a 16-month window at any 
time following release from the Guard and Reserve that they can 
use their 1606 benefits. It is simply an extension of the 
delimiting date.
    And since their delimiting date would occur when they 
separate from the Guard or Reserve, that would be the extension 
that they would get is 16 months from that point forward.
    Ms. Herseth. Just to clarify, I think I see what you are 
saying and it may have added. The delimiting date is from the 
time where they are eligible for the benefit, when they have 
signed up for the benefit?
    Mr. Wilson. No.
    Ms. Herseth. Not signed up, but the delimiting date is--let 
me use just a hypothetical of my neighbor's son. Okay? So he 
was activated. He went into the Guard in 2000 or 2001. Let us 
say 2001. They were then activated in December of 2003 and were 
demobilized in March of 2005. He then chose to separate. He was 
unaware that he could use any 1606 benefits that had been 
accumulated after he separated.
    Mr. Wilson. Following separation. And he would have had the 
period equal to the amount of activation plus 4 months from the 
point that he separated which is his delimiting date.
    Ms. Herseth. Which would bring us to, let us say, when they 
got back in March of 2005, he then separated in June of 2005, 
so he would have 16 months--no--he would have 20 months.
    Mr. Wilson. He would have the length of time equal to his 
activation plus four months.
    Ms. Herseth. Plus four, so that brings us to, if someone 
can help me out, what date would that bring us to? June 2006.
    Mr. Wilson. Approaching current date, I believe.
    Ms. Herseth. Nineteen months. By the time we give him this 
information, it is past the date. So now he has no 1606 
benefits. Once we have clarified the confusion, it is too late 
for him.
    Do we have any idea how many individuals are caught in that 
gap?
    Mr. Wilson. We do not. What I do know is we have paid about 
3,500 individuals under this clause. I do not know how many 
people would have been eligible because it would be dependent 
on the unique circumstances of the individual. In order to take 
advantage of it, they would have to go to school, of course, 
immediately following separation.
    Ms. Herseth. If you separate in June, you would have to 
take courses in the summer. You could not wait until the fall 
semester?
    Mr. Wilson. If you did, you would be burning your 
delimiting date and not getting any benefit out of it because 
the clock starts at the delimiting date.
    Ms. Herseth. At the date of separation?
    Mr. Wilson. The separation.
    Ms. Herseth. Okay. Mr. Duehring, did you want to add 
anything?
    Mr. Duehring. Actually, we agree on this particular 
provision.
    Ms. Herseth. There is no disagreement anymore on how that 
is interpreted by DOD and the VA in terms of extending the 
delimiting date?
    Mr. Wilson. That is correct. There is no disagreement.
    Ms. Herseth. But you are not aware of how many people 
either may have been eligible and were not aware because of 
maybe some initial confusion on how we interpret that and now 
their benefits have been foregone? No study or analysis has 
been done?
    Mr. Wilson. I am not aware of any analysis, no. I will go 
back and look to see if we could have data that could 
hypothetically determine something. I do not know if we can or 
not.
    What we are doing is preparing material that is going to go 
through DOD's chain of command to the units to ensure that 
clarity does exist at the unit level and DOD has agreed with 
this approach. We will providing that information to DOD any 
day. We do not have that rolled out yet, but we will shortly.
    That does not address your concern, though, of the 
individuals that have separated. And we will have to do some 
analysis to see if we can come up with something.
    [The following was subsequently received from Mr. Wilson:]

        Education Service: Data on those potentially eligible for 1606 
        delimiting date extension since September 11, 2001.

          Our best estimation, based on data from the Defense Data 
        Manpower Data center, is that there are approximately 100K that 
        meet the following criteria:

          Activated or deployed from a reserve component after 
        September 11, 2001.
          Were at one point coded eligible to receive chapter 
        1606 benefit from their reserve component.
          Are not currently in the Selected Reserves (as of 
        January 31, 2007--the most recent data we have).

          We are unable to determine the impact of intangibles. For 
        example, usage rate for the MGIB-SR is 42%, not 100%. 
        Additionally, the MGIB-SR was not intended, and is ill-suited 
        to serve as a readjustment program. The amount of the benefit 
        ($309 for full-time attendance) prohibits most individuals from 
        pursuing full-time training following separation from the 
        Guard/Reserve. Additionally, the REAP program pays a 
        significantly higher benefit ($645 for full time training 
        following 1 year of continuous activation) than the MGIB-SR 
        program. As a result, the incentive to remain in the Guard/
        Reserve created by the REAP program is greater than the 
        incentive to leave the Guard/Reserve created by the MGIB-SR 
        delimiting date extension.

        Education Service: Please provide a clearer understanding of 
        cumulative and consecutive service when it comes to 1606 
        delimiting date extensions:

          Each active service period gets counted and the additional 4 
        months are attached to each period. Active service does not 
        have to be consecutive. Example: A reservist is called to 
        active duty for 1 year. He returns home for a year. He is 
        called to active duty again for 1 year. He would be entitled to 
        an extension of 1 year plus 4 months for each period of 
        activation for a total extension of 32 months.

    Ms. Herseth. Then in terms of the consistency of 
interpretation between the VA and the DOD, is it based on 
consecutive or cumulative time of deployment?
    Mr. Duehring. The proposal is cumulative. The existing rule 
now is consecutive time.
    Ms. Herseth. When you say the proposal, whose proposal?
    Mr. Duehring. I believe it is in H.R. 1102.
    Ms. Herseth. Oh, you mean in one of our legislative 
proposals?
    Mr. Duehring. Yes. There is a legislative--correct me if I 
am wrong on that--but it is now interpreted it is consecutive.
    Ms. Herseth. Has there been any discussion within the DOD 
given the Pentagon's recent change of policy as it relates to 
the call-up time for National Guard and Reservists limited to 
12 months to make it cumulative for those that may have been 
deployed earlier?
    Mr. Duehring. This area, certainly this is not the first 
time we have heard of it. This along with the other issues 
that--I am sorry--who mentioned it in their opening remarks 
about, you know, the changing benefits for retirements and so 
on and so forth are a part of a broad spectrum of changes that 
we are looking at that have come in from different Committees 
in Congress, come in from the field, come in from the Reserve 
associations.
    And I think that is the wise way to do it. Quite frankly, 
it is an issue we need to address. We are well aware of it. But 
we have to look at the impact that it might have and not only 
on the individuals but on other programs that it would affect 
and, of course, the cost and so on and so forth. But definitely 
we are aware of that.
    Ms. Herseth. Okay. I appreciate that. I appreciate that you 
understand the Subcommittee's--I do not want to speak for the 
other Members, but the issue here of individuals that may have 
fallen through this gap. I think each State has done a good 
job, but I think some States have done better than others of 
making their Members aware and educated about the benefits on 
the education side.
    My concern is that of those National Guard and Reserve 
units that were among the first to be called up and then the 
first to come home and get demobilized that that process was 
not perfected in any way. Those are the individuals that were 
not aware that they had a residual education benefit that they 
could actually use post separation.
    My time, I have gone way over. Let me recognize Mr. 
McNerney, if you have any further questions for this panel?
    Mr. McNerney. I do not have anything at this time. Thank 
you.
    Ms. Herseth. Mr. Moran?
    Mr. Moran. Madam Chairman, thank you.
    Just let me ask you as representatives within the 
administration from the Department of Defense and Veterans 
Affairs, does the administration have any recommendations in 
addressing the issue that I raised just in my brief comments 
about the disparity between--do you recognize there is a 
disparity between the benefits received, educational, 
retirement, healthcare between active military and Reserve and 
Guard? Do you agree that the issue needs to be addressed and, 
if so, do you have specific proposals within the administration 
to do so?
    Mr. Wilson. In terms of recognizing the disparity, yes. 
Many of the programs that we administer by design do have 
disparity between what an active-duty member can draw and what 
a Guard and Reservist can draw. That has been built into the 
programs themselves.
    Concerning initiatives, I am not aware of any initiatives 
to address that within the Administration right now, no.
    Mr. Moran. Mr. Duehring?
    Mr. Duehring. Well, I was just going to say I will probably 
use the word differences. There are differences between the 
Reserve forces and the active duty. We all know that.
    And it is constantly being reevaluated because when we 
change from a strategic to an operational Reserve or as we 
change, shall I say, we constantly reevaluate compensation and 
a host of other programs.
    And, again, as I alluded to before, they all overlap. It is 
like pulling a string in a rug. You pull one string and the 
whole rug shakes a little bit. And we have to be very, very 
careful, proceed cautiously.
    I think in the five and a half years that I have been with 
the administration, I have seen some remarkable progress, 
remarkable cooperation between the Administration, the 
Congress, working with your professional staffers to iron out 
the little bumps in the road, the technical glitches, that we 
as a group have done a good job to recognize our people, to 
compensate them, to take care of the wounded warrior when they 
come back.
    I personally believe that in my heart. And I see from day 
to day and I listen to what people are talking about and they 
are going in the right direction, maybe not as fast as some 
people would like us to go, but we are moving toward the goal 
of keeping that all-volunteer force sharp, ready, and the best 
people. And, gosh, I guess the proof is in what you see out 
there. There are wonderful, wonderful folks doing a magnificent 
job.
    Mr. Moran. Mr. Wilson, I was in artful in phrasing my 
question because I assume you recognize that there is a 
distinction or a difference. It is there.
    My question was, is there a belief that those distinctions, 
differences are justified or, as Mr. Duehring just indicated, 
we are constantly evaluating that, I assume from a fairness, a 
justice side, but from recruitment, retention?
    It is just my theory or my thought is that our Guard and 
Reserve are asked to perform services in a much more continuing 
fashion, greater number of deployments, longer time of being 
away from family and work. And I was interested in knowing 
whether the difference in which we treat active military and 
our Guard and Reserve components is one that is--the 
differences that are still there are still justified.
    Mr. Wilson. In terms of being justified or not justified, 
what I would say is that, as has been mentioned, we are 
constantly reevaluating these programs. The working group 
having understanding that there is a lot of frustration, that 
the working group has not provided their report. I think the 
working group is a demonstration of the understanding both from 
DOD and VA that these issues do have to be looked at.
    And there is at least a situation where reasonable minds, 
whether they agree or disagree that the programs are currently 
the best that they can be, realize that there is an 
understanding that we have to address them and make sure that 
there is being done everything that we can do to improve the 
programs.
    The 1607 program, I think, is a good example. We are 
pleased to be able to administer the 1607 program. That is an 
outstanding program. We have been paying that benefit for about 
a year now. And, fortunately, that benefit did go retroactive 
to September 1st.
    So it did allow anybody that has been called up from Guard 
and Reserve during this period to take advantage of that 
benefit. And those are the type approaches we want to continue 
to take.
    Mr. Moran. I thank you for your answers and for your 
testimony.
    And thank you, Madam Chairman.
    Ms. Herseth. Thank you, Mr. Moran.
    And my concern related to what Mr. Moran's line of 
questioning pursued is that from a 2004 report and then 
reaffirmed in a hearing about a year ago, it seems that the 
Department of Defense--I know you testified that you are 
constantly reevaluating this. But it seems to me that so long 
as DOD is meeting its recruitment and retention goals, it is 
satisfied with the current benefit.
    And while the current benefit has gone from 47 percent of 
the active-duty rate now down to about 29 percent of the 
active-duty rate, that even if it goes down to ten or fifteen 
percent or lower of the active-duty rate, as long as we are 
meeting recruitment and retention goals, people are going to be 
fine with the current benefit. That raises the equity issues 
that a number of the members here today have identified.
    Mr. Duehring, during last fall's joint Committee hearing 
with the Armed Services Military Personnel Subcommittee, 
Michael Domingus, Deputy Under Secretary of Defense, Personnel 
Readiness, said that the Reserve components, except for the 
Navy Reserve, were close to meeting their recruitment goals.
    Do you know if that is still the case?
    Mr. Duehring. Yes, ma'am. That actually is. And as I 
recall, the most recent data that I saw showed the Navy still 
is just a little bit down what I have through February of 2007 
for this year.
    The Navy has reached 90 percent of its goal. The Army 
Reserve was also below a hundred percent at 94 percent. The 
others were in excess of a hundred percent. And that is the 
most recent data I was able to get a hold of.
    Ms. Herseth. Okay. One last question for you, Mr. Wilson, 
based on my coffee conversation with the young men. Once that 
system was automated for Chapter 1607 benefits and when we had 
some of those questions over the last year to two years, they 
say it is working well except sometimes the checks are delayed. 
There is a delay in actually getting payment.
    Do you know what the cause of that might be now that we 
have automated that system?
    Mr. Wilson. The delay would be the lingering impact of the 
initial roll-out of the program. We have been paying the 
program for about a year. We are receiving a significantly 
higher number of claims than we had anticipated. We believe, 
again going back to the nature of the way it was implemented, 
we are paying benefits retroactive to September 11th of 2001.
    So we are receiving a lot of claims in. And from an 
administrator point of view, those claims are difficult to 
administer. It does take a long time to work out the mechanics 
of those.
    We have stood up what we call an automated payment system 
in our benefits delivery network system. But it does not 
automate the entire process. It does require manual 
intervention on most of these cases because of the amount of 
retroactive time that we are paying benefits.
    Ms. Herseth. Okay. Does it require manual intervention 
because of the way we have set this up in terms of a percentage 
of the active-duty rate based on less than a year activated, 
but less than 2 years activated? Is that part of the issue too?
    Mr. Wilson. My understanding is no. The issue more is most 
of the claims that we are processing, certainly the original 
claims right now for REAP are cases where an individual drew 
1606 benefits previously and we are required to go back and 
manually basically calculate the difference so we do not 
overpay the individual.
    Ms. Herseth. I appreciate the explanation. I hope that we 
continue to make progress, however, in decreasing the amount of 
manual intervention necessary so that once the claim is 
processed that the benefit can be delivered on time every time 
and not put these service men and women that are enrolled in 
school in a tough spot, even if it is only two or 3 weeks.
    Mr. Wilson. Absolutely.
    Ms. Herseth. Okay. Dr. Snyder, did you have any questions 
for the panel?
    Mr. Snyder. No. Thank you.
    Ms. Herseth. Dr. Boozman?
    Mr. Boozman. No.
    Ms. Herseth. Thank you both very much. We appreciate your 
testimony and responses to our questions.
    Just to emphasize, Mr. Wilson, if you can get us any kind 
of timetable by next Friday, we would appreciate that.
    Mr. Wilson. Will do.
    Ms. Herseth. Thanks.
    I would now like to call the panelists for next testimony. 
We have Major General Scherling, Major General Wofford, and Mr. 
Robert Norton, Colonel Norton, yes.
    Our second panel of witnesses does include Major General 
Terry Scherling of the National Guard Bureau; Major General 
William Wofford, State Adjutant General of the Arkansas 
National Guard; and Colonel Robert F. Norton, Retired Deputy 
Director of government Relations of the Military Officers 
Association of America respectively.
    You will each be recognized for your oral testimony. Your 
complete written statement will be made part of the record for 
this official hearing.
    Why don't we start with you, Major General Scherling.

STATEMENTS OF MAJOR GENERAL TERRY L. SCHERLING, DIRECTOR, JOINT 
STAFF, NATIONAL GUARD BUREAU; MAJOR GENERAL WILLIAM D. WOFFORD, 
 ADJUTANT GENERAL, ARKANSAS NATIONAL GUARD; AND COLONEL ROBERT 
 F. NORTON, USA (RET.), DEPUTY DIRECTOR, GOVERNMENT RELATIONS, 
            MILITARY OFFICERS ASSOCIATION OF AMERICA

         STATEMENT OF MAJOR GENERAL TERRY L. SCHERLING

    Major General Scherling. Chairwoman Herseth, Ranking Member 
Boozman, distinguished Members of the Committee, thank you for 
the opportunity to speak to you today. I greatly appreciate 
your commitment to our Nation's veterans and am pleased to 
testify on educational benefits for the National Guard.
    Since its enactment in 1985, the Montgomery GI Bill has 
been a great recruiting and retention tool. In fiscal year 
2006, nearly 90,000 Guardsmen and Reservists received 
educational benefits and almost 24,000 of those receiving 
benefits took advantage of the new REAP, Reserve Educational 
Assistance Program, designed to assist our troops who have been 
activated for at least 90 days since September 11th, 2001.
    Together these two programs have assisted about 600,000 
members of the Ready Reserve to further their education. These 
educational benefits are of great value to the Guard's men and 
women and to the American workforce.
    The National Guard is transitioning to an operational 
Reserve, increasing our role both globally and also at home, 
and it is appropriate that the educational benefits reflect the 
deployment realities of the National Guard units and its 
members and taking into account both the Guard's contribution 
and sacrifices.
    Thank you.
    [The statement of Major General Scherling appears on pg. 
39.]
    Ms. Herseth. Thank you very much.
    Major General Wofford, welcome.
    Now I understand that there are two Mike Rosses in 
Arkansas, at least two. I have met them both. I know one very 
well. I have met the other one given his leadership in the Gulf 
Coast recovery efforts after the hurricanes. Please extend him 
my best wishes, and thank you for being here today.

         STATEMENT OF MAJOR GENERAL WILLIAM D. WOFFORD

    Major General Wofford. Thank you very much. And I will 
certainly pass on your comments.
    Chairwoman Herseth and distinguished Members of the 
Committee, I am Major General Bill Wofford, the Adjutant 
General of the Arkansas National Guard, and I sincerely 
appreciate this opportunity to talk to you today about 
educational benefits to the Guard and Reserve.
    I would like to point out that as I speak to you today, not 
as a member of Department of Defense, but as representatives of 
the almost 10,000 men and women of the Arkansas Army and Air 
National Guard, so that is what I based my comments on today.
    I will tell you that civilian education benefits are an 
integral part of our efforts to maintain a viable force to meet 
mission requirements. Individuals normally join the military 
for one of five reasons: training, education, adventure, money, 
or service to their country.
    Now, statistical data and my recruiting force tell me that 
educational benefits is the primary reason an individual joins 
the Arkansas National Guard. I will tell you that the Arkansas 
National Guard has mobilized over 85 percent of our total force 
since September 11th, 2001.
    A Cold War strategic reserve for which our National Guard 
and Reserve forces were organized and resourced for has evolved 
to an operational force that supports our active military every 
day. The increase in service and sacrifice that our members 
make should be met with equitable benefits as their active 
component counterparts.
    I would like to focus my testimony primarily on GI Bill 
benefits and I would like to share with you a few stories to 
kind of bring this into focus.
    My first story is about a young man that served 4 years on 
active duty in the Army in the early 1970s. Even though this 
was during the Vietnam War era, this young man was not called 
into combat. After departing the Army, this individual 
continued his civilian education using the GI Bill benefits 
that he had accrued to further his civilian career.
    The second story is about a young man that volunteered to 
serve in the Marine Corps and ended up serving 1 year in 
Vietnam with the 1st Marine Division. A few years later, this 
individual returned to college, completed his last 2 years of 
his undergraduate degree, and 3 years of medical school using 
his GI Bill benefits.
    Now, our third story has to deal with a young man who 
followed in his father's footsteps by joining the National 
Guard. Three years ago, a major mobilization of the National 
Guard occurred within the State where this individual was 
cross-leveled from the unit he joined into another unit that 
was deploying.
    He went to the mobilization station. He trained with his 
new unit and he deployed to Iraq for 12 months and returned 
home and was transferred back to his original unit in March of 
2005.
    Four months after returning home from Operation Iraqi 
Freedom, his unit was mobilized and he was not required and he 
was not expected to return to combat, especially so soon after 
returning home. But he chose to go with his unit. As he said, 
this is my unit, these are my friends that I initially joined 
the Guard with, and I cannot let them go into combat without 
me.
    Now, ladies and gentlemen, those are the kind of young men 
and women that we have got serving in the military today both 
on active duty and in the Reserve Components. And I am 
extremely proud to say that that young man is a member of the 
Arkansas National Guard.
    Now, I would like to point out that our Guard and Reserve 
members are called upon more now than ever before to serve this 
great nation. And they continue to serve their states as well.
    Over 8,500 men and women from the Arkansas National Guard 
have deployed in support of the Global War on Terror. 
Approximately 2,000 members have volunteered to serve more than 
one rotation and several hundred served for an extended period 
of time in support of Hurricane Katrina.
    In Arkansas, we currently have 250 personnel on the 
southwest border serving in Texas, New Mexico, and Arizona. Our 
State was recently hit by a devastating tornado where 150 of 
our Guard personnel were called upon to provide support to the 
community of Dumas, Arkansas.
    And I say that because I want you to understand that 
service to our country has not just increased for the National 
Guard.
    Each quarter, we conduct the Camp Robinson Camp Pike 
Community Council. Camp Robinson is the headquarters for the 
Arkansas National Guard and Camp Pike is the location for a 
regional readiness command for the Army Reserve and the Marine 
Corps and Naval Reserve Center in Arkansas.
    One of the purposes of the Community Council is to provide 
awareness of the military to our civic and business leaders in 
central Arkansas. During each meeting, the Guard and Reserve 
provide updates on their deploying units and also their units 
that are returning to home station.
    Now, the civilians in the audience are not just civic and 
business leaders. Many are employers of our Guard and Reserve 
members. Some of our civic members are prior servicemembers and 
some are not.
    However, regardless of whether or not they have previous 
prior military experience, they see the sacrifices that are 
being made by our Reserve component members and their families. 
These business men and women are also sacrificing while their 
employees are deployed. Yet, they continue to stand ready to 
support any way they can.
    I do not want to imply that the Guard and Reserve are doing 
more than the active components. However, I would like to make 
note that at this time, equal service does not provide equal 
benefits when it comes to the GI Bill.
    In 1985, Reserve component members were eligible for GI 
Bill benefits that equated to 47 cents to the dollar that an 
active component counterpart was eligible for. Today that ratio 
equates to only 29 cents to the dollar. So our benefits have 
actually decreased over the years.
    Our active component counterparts are eligible to continue 
the GI Bill benefits after they are discharged from service. 
Guard and Reserve members normally are only eligible to use 
their GI Bill benefits while they are still an active serving 
member of the Guard and Reserve.
    Regardless of the number of years of service and regardless 
of the number of times that a Guard or Reserve member has been 
placed in harm's way in service to their country, they are not 
eligible for the GI Bill benefits once they leave service.
    Occasionally my office receives inquiries from parents 
asking why their son or daughter who is a former member of the 
Arkansas National Guard and who served in Operation Iraqi 
Freedom is not eligible for their GI Bill educational benefits. 
I honestly do not have a good answer for them. In the end, we 
have lost the support of those parents and most likely will not 
see their son or daughter get back in the Guard if they so 
choose.
    I understand the GI Bill for the Guard and Reserve is not 
only a recruiting incentive, it is also a retention tool. If a 
Guard member wants to use the GI Bill, they have got to stay in 
the Guard. They have got to maintain their membership.
    And I agree that we could possibly see a decrease in the GI 
Bill being used as a retention tool if eligibility is extended 
after a member is discharged. However, I would like for us to 
think, as an example, about the shortage of junior officers 
that we currently experience in the Guard and Reserve.
    One of the requirements before an officer can be promoted 
to the rank of Captain in the Guard is you have got to have a 
4-year college degree. It is difficult for a young person to 
juggle a career, college education, their family, and their 
military membership in the Guard or Reserve all at the same 
time. It is very difficult. In many cases, we are losing our 
best and our brightest because they are unable to meet the 
demands of their young life.
    I believe if the GI Bill were received based on equal 
benefit for equal service, then we would see some more of our 
prior servicemembers that chose to get out of the Guard and 
Reserve coming back to us later on; one, because they were 
treated equitably, but they would be coming back with a college 
degree and be in a better position to become commissioned 
officers in our organization.
    In closing, I would like to return to the three stories 
that I shared with you earlier. The first two young men that I 
discussed used their GI Bill to further their civilian 
education after leaving military service. Even though he had 
not served in combat during his active-duty tour, the first man 
furthered his education and later joined the National Guard. He 
served as a battalion commander during Operation Desert Storm 
and he served in various leadership positions throughout his 36 
years in the National Guard. That individual is me.
    The second individual that continued his civilian education 
using the GI Bill after he left the military, completed his 4-
year degree, a medical doctorate, and later on a law degree. 
The individual has served our State and our Nation proudly 
since 1996 as a Member of Congress. That individual is your 
colleague and my Congressman, Honorable Vic Snyder.
    However, for the rest of the story, the third individual I 
mentioned is Staff Sergeant Jason Bowan, Battery B, 1st 
Battalion, 142nd Field Artillery, Springdale, Arkansas.
    As I mentioned earlier, he was transferred from his unit in 
northwest Arkansas to fill a vacancy in the 39th Brigade Combat 
Team that mobilized and deployed to Iraq, returning in March 
2005. In August of 2005, just a few months later, he once again 
left his family and placed his civilian career on hold to do 
what he thought was right, what he thought was right for his 
fellow soldiers and for his country.
    And I am thrilled to share with you that Sergeant Bowan is 
back home with his family and is again continuing his civilian 
career after having spent 24 months in combat during the last 3 
years.
    Unfortunately, Sergeant Bowan has decided that he wants to 
leave the National Guard so he can continue his civilian career 
uninterrupted. I think it is extremely unfair that by getting 
out of the Guard, he loses his education benefits under the GI 
Bill unlike the active component counterparts that he served 
with side by side during Operation Iraqi Freedom.
    The disparity in benefits is difficult to understand and it 
cannot be explained satisfactorily to our Guardsmen, to their 
parents, or to me. And I do not have all the answers on how to 
make the GI Bill more equitable. I do not know what the cost 
would be for the proposed changes in the bill.
    I can only speak from my personal experience of the 
opportunities that the GI Bill gave me in my life. And on a 
larger scale, I think our communities would benefit as there 
would be an increase in higher educated individuals in our 
society. And in the long run, I think the military would 
possibly see prior servicemembers returning to the military 
with a higher level of education.
    I thank the Committee for the hard work that you are doing, 
your dedication to your country, and your continued support for 
our military. Thank you very much.
    [The statement of Major General Wofford appears on pg. 39.]
    Ms. Herseth. Thank you very much, Major General.
    Colonel Norton.

             STATEMENT OF COLONEL ROBERT F. NORTON

    Colonel Norton. Thank you, Madam Chairwoman and Ranking 
Member Boozman, for this opportunity to testify today before 
you on behalf of the 362,000 members of the Military Officers 
Association of America on this very important issue.
    MOAA is an original founding member of the Partnership for 
Veterans Education, which includes all of our colleagues in the 
military coalition, 35 organizations, and also organizations 
representing higher education.
    A number of those organizations are here today, including 
the American Council on Education, our great friends in the 
American Legion who strongly support integrating the Montgomery 
GI Bill, the VFW, and a number of others.
    Madam Chairwoman, MOAA is extremely grateful to you and 
Ranking Member Boozman for the strong bipartisan leadership you 
have shown on this issue as original cosponsors of House 
Resolution 1102.
    We are also grateful for the bipartisan support shown by 
Representative Vic Snyder, the Chairman of the Military 
Personnel Subcommittee of the House Armed Services Committee, 
for improving Reserve Montgomery GI Bill benefits.
    I want to focus my remarks on debunking the myth that 
improving the Reserve Montgomery GI Bill would hurt recruitment 
and retention, especially retention, in our Guard and Reserve 
forces. The reality is that improving benefits under the two 
Reserve programs would actually drive better recruiting and 
retention in the Guard and Reserve.
    Retention and recruitment are under enormous strain as 
General Wofford, has alluded to as the War in Terror goes on 
into its fifth year. The services need every tool in the tool 
kit to attract and retain men and women for active duty or 
Reserve service. The MGIB, the Montgomery GI Bill, is one such 
tool in the tool kit.
    In failing to advance even modest upgrades in the Reserve 
programs, the Pentagon, in our view, has missed opportunities 
to strengthen Reserve retention and readiness. How so? Let me 
offer three examples.
    The basic Reserve Montgomery GI Bill under Chapter 1606 
requires continued service in the Guard or Reserve to retain 
benefit eligibility. If you get out, you lose it.
    In our view, DOD could and should have sponsored removing 
the 14-year ceiling on in-service usage of the benefit but has 
never brought that forward. That alone would have been a strong 
incentive to over-stressed, mid-career Guardsmen and Reservists 
trying to decide with their families and with their employers 
whether they could continue to participate in the new 
operational Reserve. In other words, whether to stay in or get 
out.
    The second example, since 9/11, basic benefits have dropped 
off sharply against the active-duty benefit as General Wofford 
has indicated. Before 9/11, they paid roughly 50 cents to the 
dollar for active-duty GI Bill benefits. Today they pay only 29 
cents to the dollar.
    So instead of getting $500 per month for in-service use of 
their benefit, Reservists and Guard's persons are only getting 
a little over $300 per month. That is clearly not enough money 
for schooling today and it is hardly much incentive at all to 
remain in the Guard and Reserve after the initial contract 
obligation.
    If the administration had recommended even modest stair-
step increases to the basic benefit since 9/11, the Guard and 
Reserve would be in a much better position today to, I will 
call it, sweeten the pot on continued service in the Guard and 
Reserve in addition to service cash bonuses and other 
incentives.
    Unfortunately, as you know, the Pentagon has now testified 
three times, with a modest exception that you heard about 
earlier, three times in a row that essentially there is no need 
to make any adjustments to the Reserve programs.
    And I believe, frankly, that the modest adjustments that 
were offered here today that are coming forward from the 
administration reflect the persistence, the pressure, and the 
interest from your Subcommittee and from the Armed Services 
Committee that the Montgomery GI Bill for Reserve and Guard is 
broken and it needs to be fixed.
    Under operational Reserve policy, Reservists are now 
required to be on 1-year tours of active duty every five or 6 
years. Since 9/11, over 85,000 members of the Guard and Reserve 
have already served two or more tours and nearly 600,000 have 
served overall. They are so busy with their training and 
deployments that they do not have time enough to use their 
benefits in service.
    I was talking with General Wofford before the hearing began 
and he indicated that of one Arkansas' units--I believe it is 
your Infantry Brigade--served in the early days of the Global 
War on Terror in Iraq and they are in the pipeline, they are in 
their recall pipeline. They have returned home. They are going 
to be called up and deployed back on active duty within a 3-
year window.
    Now, that is the same as the active services deployment 
cycle. And, yet, every member of that brigade who served then, 
if they go back on active duty in the coming deployment next 
March or April of 2008, they will be ineligible to earn extra 
Montgomery GI Bill benefits defending this Nation in the War on 
Terror when they are deployed.
    Now, that sends a very strong signal to them, to their 
families, and to the prospects that they have. Why should they 
stick around? What is the incentive?
    If they have got to go back on active duty every five or 6 
years, we, the Nation, owe them the opportunity to earn 
additional Montgomery GI Bill benefits for their service for 
the reasons that the General pointed out in terms of the 
professional development of the Officer Corps, in terms of 
retention, in terms of doing what is right, fair, and equitable 
for these great young men and women.
    That leads to my third point to debunk the myth, and really 
I have already covered it, the myth that the total force GI 
Bill would hurt retention. Under the bill that Chairman Snyder 
has sponsored and you have cosponsored along with the Ranking 
Member Boozman, mobilized Reserve and Guard members can earn 
entitlement for the GI Bill every time that they are activated, 
but that is not true today. They only get credit for one tour.
    Under the proposal, there is a built-in incentive for our 
Guard and Reserve volunteers to continue to serve because they 
know that if they are called up again, if they do subject 
themselves to continued service and sacrifice in the Guard and 
Reserve, they will continue to earn Montgomery GI Bill 
entitlement up to the 36th month maximum entitlement. That adds 
incentive for continued service. It is not a disincentive 
toward recruitment.
    Let us also consider the fact that active-duty service men 
and women have a readjustment benefit under the Montgomery GI 
Bill. And the Pentagon has not objected to raising active-duty 
rates for fear of hurting active force retention. Not in the 
20-year history of the Montgomery GI Bill has the Pentagon said 
they are worried that active-duty veterans are going to leave 
because of the readjustment benefits under the Montgomery GI 
Bill.
    Reserve and Guard veterans of Iraq and Afghanistan earned 
VA healthcare benefits, VA disability payment opportunity if 
they are disabled or wounded in combat. They are eligible for 
VA home loans and on and on. The only veterans' benefit denied 
them for their service and sacrifice to the Nation in the War 
on Terror is access to their mobilization GI Bill benefits when 
they complete their service, whether that is 6 years or 35 
years.
    Madam Chairwoman, the root question, and I will call it as 
Congressman McNerney said, the ``cockroach under the couch'', 
the root question lurking beneath this issue is a fundamental 
one. Are our National Guard and Reserve men and women who serve 
on active duty defending the Nation in the War on Terror, are 
they veterans or not?
    If the answer is no, Congress does not see them as fully 
deserving of all veterans' benefits. And if that is the case, 
then there is no reason for House Resolution 1102 or this 
hearing for that matter. Leave the Reserve Montgomery GI Bill 
in Title 10 and just use it as a weak recruiting tool to 
support recruiting.
    We believe that the Subcommittee and Congress see it 
differently. We believe and we are confident that the American 
people, Reservists, and Guardsmen themselves do not see it that 
way. Operational Reservists are serving repeatedly on active 
duty. They are in the surge. They are in harm's way.
    Congress should not give them any of these benefits. They 
have earned them through their service and sacrifice, and it is 
time to swiftly enact House Resolution 1102, the Total Force 
Montgomery GI Bill.
    Thank you, Madam Chairwoman and Congressman Boozman, for 
your leadership on this issue, and I would be happy to answer 
any of your questions.
    [The statement of Colonel Norton appears on pg. 41.]
    Ms. Herseth. Well, thank you very much, Colonel Norton. We 
appreciate your insights and perspectives and working closely 
with us and Committee staff to address the inequities that many 
acknowledge exist.
    Major General Wofford, thank you very much for your 
testimony, and Major General Scherling as well. I appreciated 
in particular your willingness to share your story and Dr. 
Snyder's, some of which we were familiar with.
    Let me go to the third individual you described. You 
mentioned that he is going to separate from service to pursue 
his civilian career and described sort of the difficulty of 
these men and women kind of juggling everything at the same 
time with full-time employment, education, family, continued 
Guard service.
    Based on current policy, as Mr. Duehring explained, the 
extension of the delimiting date is based on consecutive months 
of active-duty service versus cumulative. Even if this young 
person were in a position, in addition to his career, to also 
access the benefits post separation, he would be at a 
disadvantage because he served a number of months cumulatively, 
but it would only count, the extension of the delimiting date 
would only count, for the consecutive months of either his 
first or second tour, is that correct?
    Major General Wofford. That is correct. As I understand the 
way it was explained, that is correct.
    Ms. Herseth. And that extension, that is not going to be 
sufficient for many, particularly if there are family 
obligations, or civilian career obligations.
    But if we, based on what Dr. Snyder, Mr. Boozman, and I, 
the legislation that we have supported where you allow a 10-
year window and post-separation use, you may, just as you 
described, have someone who returns and for career 
opportunities or financial reasons who cannot take advantage of 
the education benefits in that 16-month timeframe, but 
certainly could four or 5 years down the road.
    Major General Wofford. Madam Chairwoman, you are exactly 
right. And it depends on the individual. Every little bit 
helps. But based on the computation or the calculations we were 
given, that might help for a semester or a couple of semesters. 
And that is if the individual goes back to school right now.
    If he is wanting to pursue his career and continue to take 
care of his family, he may opt to wait to finish his education 
a couple of years down the road, way too late to use any of the 
benefits he has accrued. And I think that is the point.
    Ms. Herseth. I think that is an important point. I am aware 
of Reservists in South Dakota who after their deployments, they 
come home. I will just use the example of a high school friend 
of mine. He is a teacher and coach in high school up in the 
northeastern part of the State. He comes back and his wife 
tells me, well, you know, he sort of wants to do something 
different.
    Now, he reenlisted in the Reserve while he was deployed, 
but if he had not done that, and for financial reasons, because 
they have three little girls, he continues in the school 
district, but because of just how each individual is changed 
during a deployment and the family circumstances coming back, 
he would have to go to school right away despite the fact that 
he has got, you know, his family that he and his wife both work 
to support. It really narrows his opportunity even though he 
was deployed for 16 to 18 months. It is almost like forcing 
them into an unreasonable time table.
    I am sorry I am not posing a question, but it is the 
readjustment issue, and it goes to what Colonel Norton just 
said, are they veterans or not? I think the answer is yes. Even 
if they reenlist in the Selected Reserve, they served. They are 
a veteran. They qualify and they should be treated to the same 
type of equity and adjustment that those that leave active duty 
deserve to give them some degree of flexibility given their 
circumstances.
    Major General Wofford. Madam Chairwoman, if I could, you 
have got an excellent understanding of the situation. Our 
redeploying soldiers need some time to decompress once they 
return from combat.
    With the daily stress of combat, being away from their home 
and from their job and their families for extended periods of 
time, 12 months in combat, if you add on the three, four, 6 
months prior to that in training, preparing to deploy, they 
have been gone for quite a period of time.
    Most individuals are not ready to jump right back into the 
stress of daily life. There has got to be an adjustment period. 
We are seeing this through the VA system with our soldiers that 
are returning, as you know. And the problems that surface do 
not surface the day they come home. It takes months, 3 months, 
six months, 9 months, before you actually realize somebody may 
need some help or they need more time to decompress.
    So the education benefits, they are not there when they 
need them.
    Ms. Herseth. I am glad you mentioned that. My time is up, 
but I want to ask one more question before turning it over to 
the Ranking Member.
    I am sure, just as in South Dakota with General Gorman, 
that under your leadership with the Arkansas National Guard 
that as you had those initial units mobilize and then come home 
and demobilize that you were providing as much information and 
comprehensive information as you could based on the 
interpretations of the law for those new benefits at the time.
    But just as in South Dakota where we had individuals fall 
through the cracks who were not aware that they had this 
extension of their delimiting date and sort of the whole issue 
of decompressing. The two Guardsmen I just saw last weekend 
said that we get all that information and it is helpful, but it 
is a little overwhelming when we get it all at one time.
    Are you aware of the possibility of some of your National 
Guard's men and women who may have fallen through these early 
cracks, too, where the time now has expired to access those 
1606 benefits because of that extension?
    Major General Wofford. Yes, ma'am. And it goes beyond just 
the educational benefits. It goes in some cases to health 
benefits as well. As individuals return and they are 
demobilizing at a demobilization site and they are supposed to 
go through the medical screening, the physical, and all of the 
briefings to demobilize them, they have got one thing on their 
mind and that is to get home. They do not care what is being 
presented to them.
    And I hate to say that. That sounds unfair to our soldiers. 
But their focus is getting home to their families, getting back 
to their jobs, and getting back to a normal life. So what they 
may be told, what they may be briefed, and we do this over and 
over again, but we see it; their focus is elsewhere.
    And so we have got to go back 3 months later and rebrief 
our soldiers on the benefits that they are eligible for, the VA 
health benefits and anything else they are eligible for. At 
that point, as you have already alluded to, the education 
benefits may have already expired.
    Ms. Herseth. I may come back with a follow-up. I want to 
turn it over to Mr. Boozman for questioning.
    Mr. Boozman. Thank you, Ms. Herseth.
    General Scherling, the Secretary noted the need to balance 
retention with benefits. Would you agree that how we treat 
returning members, and Ms. Herseth really alluded to this and 
we have been talking about this, but would you agree that how 
we treat returning members of the Guard and Reserve following 
deployment is a significant retention tool in itself?
    And I guess you all are talking about a National Guard 
proposed return reunion program, the R&D program. We were in 
New Hampshire and we were very impressed with what they are 
doing up there in that regard.
    Can you give us a little bit of feedback on that and tell 
us?
    Major General Scherling. Yes, sir. We are very pleased that 
the National Guard has leaned forward to put together a 
proposed program which is over at DOD right now. The law 
requires that we offer transition assistance to our returning 
soldiers and airmen.
    In this particular case, you just talked about how anxious 
they are to get home and that is very true. We have not 
probably done as good a job as we should do in the five or so 
days that the soldiers get full of briefings, physicals, and 
those types of discussions.
    What we are proposing is that we establish a network of 
transition assistance providers across all the States that 
would be accessible to all Reserve components.
    Also, another significant part of that program is that we 
authorize enough days, and I am talking about 15 days or up to 
15 days, for the soldiers to complete the required process.
    What we want to do is to do this transition program at home 
station so that the soldiers have an opportunity, as the 
General mentioned, to go home, be with their families, get 
through their physicals, conduct their briefings, go home and 
talk over with their spouse whether or not they want to go back 
to school, are they going to go back to their job. They have 
their ESGR benefits discussions at that point. And we feel that 
it would be very, very beneficial.
    Mr. Boozman. General Wofford, do you believe that providing 
a post-discharge benefit for those who do not serve on active 
duty will hurt retention? And do your Guardsmen have other 
reasons for remaining in the National Guard?
    Major General Wofford. Our members do have a number of 
reasons why they remain in the National Guard and for the same 
reasons that they get in. Part of it is that they enjoy being 
part of the military. They enjoy the discipline, appreciate the 
discipline that they received in the military that they do not 
get outside the Guard. But certainly educational benefits is 
something that is high on their reason for staying in.
    As far as those that do not serve on active duty, that 
being a retention tool to keep them in, what we are seeing is 
if an individual has made up their mind that they want to leave 
the service, whether it is the Guard or Reserve, education 
benefits is not the thing that is keeping them in to begin 
with. Okay? It sounds good.
    If the educational benefits were such a strong retention 
tool, then why does the active component not use the same logic 
and not give them educational benefits when they get out of the 
Army? I mean, to me, if it applies to one, it ought to apply to 
the other.
    Mr. Boozman. My dad was in the service and grew up in a 
military family. But the Guard then was a different deal than 
the Guard now. We have an old Guard and we have a new Guard as 
far as what is expected of them.
    And their mission has changed so dramatically in the last 
few years. And it looks like that that mission is going to go 
ahead and continue. But it looks to me like your incentives 
have to change with that.
    And I think, as the Colonel alluded to, in fact, all of you 
can disincentivize where if you are in the same situation and 
in some instances, deployed more than the guy that is in the 
regular military certainly is in harm's way as much or more or 
certainly equal, that you can get the disincentive of the bad 
feeling in your gut, you know, that you are not getting a fair 
shake. And it actually goes the same way. So, again, it is just 
something that we have got to get sorted out.
    I guess you all are familiar somewhat with Dr. Snyder's 
bill. Can you tell us?
    I do not think I have to ask Colonel Norton at all. But 
both of the Generals have been around for a while and served in 
a variety of different capacities.
    Are you on board with what we are trying to do and can you 
just comment? Do you feel like if we get this done, is this 
going to cause retention problems for you or will it go the 
other way and actually solve some of these problems that have 
been alluded to in making things much fairer and may actually 
be a benefit?
    Major General Wofford. Sir, I cannot speak for General 
Scherling or for the National Guard Bureau, but an Arkansas 
perspective. And I worry about recruiting and retention every 
day. I mean, that is part of my job.
    I am not concerned about this bill affecting my ability to 
retain soldiers in the Guard. Is there some risk? Certainly, 
because this is one more tool or one more incentive that we 
cannot hold over their head or, I guess, a handle we hold over 
their head.
    The incentive that I see is that we are providing what we 
consider equal treatment that we use to publicize, to get them 
in. I think strong leadership and taking care of your soldiers 
and your airmen is what keeps them in. It is not the fact that 
you are going to take away an educational benefit if they get 
out.
    So I have got strong feelings about taking care of our 
soldiers and airmen. And that is why I am here today is because 
I want to see them treated fairly for the service they have 
provided, especially if they are deployed in combat.
    Am I willing to take a risk on the retention part of it? I 
am, because I think this bill is worthwhile. So I support the 
bill.
    Major General Scherling. I would like to say thank you to 
the sponsors of the bill. I think it is a legislation that is 
going to enhance the benefits for our members.
    I would tell you that at the present time, both Army and 
Air Guard recruiting and retention rates are relatively high. 
It is hard to determine whether or not the operational 
commitments are going to keep them high. And this legislation 
provides an opportunity for us to try and keep the rates as 
high as possible.
    Thank you.
    Mr. Boozman. Colonel Norton, give us a very eloquent--you 
say it so well for the record.
    Colonel Norton. Well, I think you know my feeling about it. 
And I think you pointed out, Mr. Boozman, that the conditions 
of service today are extremely different than they were during 
the Cold war.
    And I think when you look at the compensation package, both 
direct and indirect compensation today for our volunteers, we 
are talking about an all-volunteer force both active duty as 
well as Reserve and National Guard. They serve because they 
want to serve. They want to be there. There are many different 
reasons that attract them into the service. But at the end of 
the day, it is a voluntary commitment to do that.
    So it seems to us really illogical and counterproductive to 
have one of those benefits that is conditional upon a 
compelling requirement. In other words, you must stay in order 
to keep this benefit. That is not how we structure the 
compensation package. We structure it because we know they are 
all volunteers. We know that they want to serve, and they have 
earned these benefits.
    I would also point out that, and this is frankly a sad 
reality of how we think compensation has not evolved overall 
for the active and the Reserve forces since 9/11 to keep pace 
with the enormous stresses that these men and women are under.
    For example, the Defense Department fought tooth and nail 
about expanding access to the military healthcare system, 
TRICARE. Said they did not need it. It was not necessary for 
recruiting, and so forth, and so forth.
    Congress saw the wisdom of expanding of TRICARE for the 
Guard and Reserve. We have other things that I think 
Congressman Jerry Moran was alluding to, Reserve retirement, 
the GI Bill. This is a force today that is not a Cold war era 
Guard and Reserve force.
    You know, when I was serving in the Army Reserve, they used 
to kid about smoking and joking in the drill hall. That is 
clearly not the nature of service today in the Guard and 
Reserve. They are fully integrated in every operation.
    The compensation and benefits package needs to keep pace 
with the reality of their service today. If they are integrated 
operationally on the battlefield, then their benefits ought to 
be commensurate and equitable in terms of the nature of that 
service.
    Mr. Boozman. Thank you.
    Ms. Herseth. Thank you, Mr. Boozman.
    Dr. Snyder?
    Mr. Snyder. Thank you all for being here.
    General Wofford, it is good to see you. I just had a quick 
comment.
    You know, our friends at DOD, I think, do an excellent job 
and have for some years now about talking about the changing 
nature of warfare and the changing nature of our adversaries. 
They have been ahead, I think, of the rest of us in pointing 
out that we are not fighting the Cold war. We have a different 
threat out there.
    And so then it gets frustrating, I think, for some of us 
when we see Cold war thinking come back around. I saw it in the 
written statement, the reference to, well, it is not a big 
problem, readjustment, because all the Reserve component folks 
are going to come back to their job.
    Well, I think there are two aspects of that. And I have 
seen them all. Number one, the job may not be there, not 
because of any disservice, you know, some employer not treating 
a Reserve component person right, that it just may have 
disappeared, that, you know, the economy turns over so much.
    The second thing is that I think younger people have much 
more of a sense of the changing nature of the economy and when 
they come back, it is a natural point for them to say is this 
the time when I want to upgrade my skills so that I can be a 
bigger participant in this ever-changing economy.
    I know one of my folks that you know, General Wofford, I 
think it was the second day back on the job after having gotten 
back from his Iraq tour, wanted to sit down with me and talk 
about, you know, obviously the Federal government did not shut 
down, he still had a job with me, but wanted to talk about what 
his changing role might be in the office because he felt much 
more confident about his skills and what he had done as a young 
officer.
    I suspect that is the nature of a lot of these folks. So it 
is a bit discouraging to kind of hear the attitude of, well, 
you know, we took them out of a manufacturing plant and they 
went off for 14 or 16 months and come back and go right back to 
the plant. That is not how the economy works.
    And I think what we are about and what you are about 
helping in this is to recognize that everything has changed 
since the Cold war not just the threat but also the economy and 
the world that our Reservists come from and go back to.
    The final thing I want to say is we concentrate a lot today 
about the Reserve component. But ultimately part of this has to 
do with the fact that as time goes by, we recognize the 
escalating costs of higher education for all veterans and all 
people. And the benefit is not what it was after World War II 
in terms of what it would buy in the educational market, and 
that is a long-term but obviously more expensive goal also.
    But thank you all.
    Thank you, Madam Chair.
    Ms. Herseth. Well, thank you, Dr. Snyder, and thanks for 
joining us at the Subcommittee today and for the hearing that 
you had a couple of weeks ago.
    I have just a couple of quick follow-up items.
    For the Generals, were you aware at the outset that Guard 
and Reservists could use their remaining 1607 entitlement for 
the number of months they were activated plus 4 months from the 
get-go?
    Was there a lag time between when that became policy and 
when you or the folks that you work with who administer and 
share information with Guard and Reservists, that there was an 
extension of that delimiting date post separation?
    Major General Wofford. Madam Chairwoman, if I could, I hate 
to admit this, but I did not have a real good understanding of 
the difference between Chapter 1606 and 1607 until just 
recently. It has been out there. Our folks in the field were 
aware of it. We have briefed our soldiers on it.
    To be honest with you, as far as the delimiting date, I do 
not think we had a real good understanding. I personally did 
not. Like I said, I am embarrassed to admit that.
    Ms. Herseth. I do not think you should be. Whenever you add 
a new benefit and then how the policy changed to allow the 
extension of the delimiting date for six when there is clearly 
confusion from a number of folks I have talked to, whether it 
is the Adjutant General or the folks that are more directly 
responsible with sharing some of that information.
    Major General Wofford. And I think 1607 was great. And that 
was the thing I liked about it because it recognized those 
individuals that were mobilized or served on active duty gained 
an additional benefit. The delimiting date was not real clear 
in my mind.
    Major General Scherling. Madam Chairwoman, the staff 
informs me that we were not aware and as a result, there was a 
lag time.
    Ms. Herseth. I appreciate that.
    And, Colonel Norton, thank you again for your responses to 
Mr. Boozman's questions.
    I see that Mr. Wilson is still here and I should have 
followed up with you. Would you mind coming for--I just have 
one follow-up, because I asked Mr. Duehring--no. It is more the 
reaction I saw on his face----
    Mr. Wilson. The dreaded follow-up.
    Ms. Herseth. --earlier and I should have followed up and 
did not. It just goes to the issue again of what was reported 
at the end of January in Military.com. I know that Mr. Duehring 
responded and I do not think I gave you the opportunity to, as 
it relates to while it may be the policy that it is the 
consecutive months on active duty that are used then, plus the 
four months to determine the extension of the delimiting date 
is it the practice at the VA to do it cumulatively if there has 
been more than one deployment?
    Mr. Wilson. I will provide a definite answer very shortly. 
My understanding is that it is cumulative. It is administered 
cumulatively. And if I could be allowed to make just a couple 
points.
    Ms. Herseth. Certainly.
    Mr. Wilson. The delimiting date extension applies to 1606 
benefits, not 1607 benefits. And the term is used both ways, I 
believe.
    And concerning the policy issue, we have been administering 
the benefit in this same manner since 1993. There has been no 
change in policy. There has been changes in individuals at both 
organizations. And that has led to what I believe was an 
institutional loss of that knowledge that required discussions.
    Ms. Herseth. Thank you. I appreciate that. I think you may 
have provided that clarification at the Armed Services 
Subcommittee as well or in some discussions with staff because 
I believe I remember seeing that that was a change made in the 
early 1990.
    I appreciate your clarification. I am not convinced that 
the confusion does not still exist.
    Mr. Wilson. I understand.
    Ms. Herseth. We will certainly work with you, with the 
Guard Bureau, with the State Adjutant General. Mr. Boozman and 
I and all the other Members of the Subcommittee and clearly Dr. 
Snyder just want to be in a position to help the most effective 
administration, whether it is 1606 or 1607, as we work to enact 
legislation to address some of the equity issues that have been 
discussed today.
    Mr. Wilson. I will look forward to that.
    Ms. Herseth. Thank you, and thank you for staying for the 
remainder of the hearing. I hope you will continue to do so in 
future hearings. Thank you.
    Mr. Wilson, I was hoping that you could send over sort of a 
clear written explanation of how it has been administered and 
what your interpretation has been.
    I think you mentioned that you would give a more definitive 
answer. And if you could provide that perhaps by the end of 
next week as well, that would be appreciated.
    Mr. Wilson. Absolutely. Yes.
    Ms. Herseth. Thank you. Thank you.
    Mr. Duehring. He will not stay for the rest of the hearing 
if you call him back.
    Ms. Herseth. That is what I was afraid of. That is what I 
was afraid of. If you do, I will assure you I will try to get 
in all of my questions when you are up on the panel. But thank 
you very much because oftentimes in our subsequent panels, 
other issues are raised and it is always helpful to be able to 
come back to some of that.
    I thank all of you for your insights. I think in particular 
some of what our Generals provided us today on the retention 
issue as we await the report from DOD and VA Working Group will 
help us and provide us some insights in evaluating just what 
the impact will be and, of course, the risk associated and the 
willingness of some to take the risk because of the strong 
leadership that they have demonstrated in meeting retention 
goals.
    Thank you very much.
    Well, I believe since we did have votes just called now, 
too, even though we thought that would happen over an hour ago, 
the hearing of the Economic Opportunity Subcommittee now stands 
adjourned.
    [Whereupon, at 3:50 p.m., the Subcommittee was adjourned.]



                            A P P E N D I X

                              ----------                              


Prepared Statement of Hon. Stephanie Herseth, Chairwoman, Subcommittee 
                        on Economic Opportunity

    Good afternoon. The Veterans' Affairs Economic Opportunity 
Subcommittee hearing on the education benefits for National Guard & 
Reserve members will come to order.
    As the lone representative from South Dakota, which this year will 
have about 2000 veterans use G.I. Bill payments for their education, I 
have an especially strong interest in exploring options to improve and 
modernize the Montgomery G.I. Bill (MGIB), particularly for National 
Guard and Reserve service members.
    Ranking Member Boozman, I look forward to working with you, all the 
Members on this Subcommittee, and our colleagues on the Armed Services 
Committee to update this important program.
    Since the MGIB was enacted more than 20 years ago, our nation's 
utilization of the Select Reserve forces has dramatically increased. 
When the Montgomery G.I. Bill was signed into law in 1984, 
servicemembers of the Guard and Reserve were rarely mobilized, and that 
simply is not the reality today. Indeed, today's citizen-soldiers are 
serving with distinction and have sacrificed a great deal in our 
efforts in Iraq and Afghanistan. Unfortunately, although they are being 
called to duty and mobilized for extended periods of time, their 
educational benefits do not reflect their increased service to our 
Nation. These patriots have earned and deserve high quality education 
and training benefits to be used in a fair and equitable manner.
    I would also like to welcome all of today's witnesses, and I very 
much appreciate your testimony as your views and insights are 
critically important to us as we go about examining this issue. I am 
particularly interested in understanding and exploring the views and 
perspectives on the proposed ``Total Force G.I. Bill.'' This proposal 
would, among other things, organize all G.I. Bill programs under Title 
38 and provide a 10-year portability of Chapter 1607 benefits. I 
believe these concepts would help reflect the reality of the Total 
Force Policy. However, I understand there may be concerns about how 
this proposal may affect retention, so I look forward to hearing from 
our witnesses.
    Much progress has been made in education benefits for National 
Guard & Reserve members. However, I think everyone would agree that we 
must remain vigilant to maintain against any decline in benefits. 
Veterans, servicemembers, and military families of this nation deserve 
our best efforts and I plan on working with my colleagues to examine 
and develop policies aimed to improve readjustments services for our 
men and women in uniform.

                                 

  Prepared Statement of Hon. John Boozman, Ranking Republican Member, 
                  Subcommittee on Economic Opportunity

    Madame Chairwoman, Thank you for holding this hearing. I know that 
we were originally scheduled to conduct a joint hearing with Chairman 
Snyder's Subcommittee on Military Personnel but events at Walter Reed 
necessitated he change his focus for the moment, and rightly so.
    Today we will hear from several witnesses on modernizing the GI 
Bill, especially as those benefits apply to members of the National 
Guard and Reserves. As you know, you and I are both original co-
sponsors of Chairman Snyder's HR 1102, and I look forward to working 
with you and my fellow Arkansan to craft changes that complement our 
ability to recruit and retain the forces we need while treating those 
who defend us fairly. That will not be an easy task, and today's 
hearing is an important part of that process.
    I suppose my basic approach is that you cannot retain someone you 
don't recruit. So, a benefit must first attract someone to military 
service. Hopefully, once someone joins, aspects of military life such 
as comradeship, adventure, training, and just plain old patriotism will 
convince members to stay regardless of whether there are post-discharge 
benefits. For those who choose to leave, we should be wise enough to 
thank them profusely for their service and make them aware that they 
are always welcome back to the family.
    Having said that, none of us on this dais can ignore the fiscal 
realities facing Congress. The question then becomes, is it fair to the 
taxpayers to pay more than needed to attract good people to military 
service? I would say that again, we must balance the levels of benefits 
with what is needed to recruit and retain members.
    Madame Chairwoman, I am looking forward to hearing from today's 
witnesses including Major General Wofford, the Adjutant General of the 
Arkansas National Guard. I found his written testimony particularly 
poignant and recommend it as a good read.

                                 

 Statement of Honorable Craig W. Duehring, Principal Deputy Assistant 
  Secretary of Defense for Reserve Affairs, U.S. Department of Defense

                              INTRODUCTION

    Chairwoman Herseth and Subcommittee Members, thank you for the 
opportunity to testify about the educational assistance programs that 
have been so effective in helping the Department achieve its force 
management objectives while providing our servicemembers with a 
valuable benefit that helps them achieve their educational goals. 
Today, we are here to discuss changes to the two Reserve educational 
assistance programs--the Montgomery GI Bill for the Selected Reserve 
(MGIB-SR) and the Reserve Educational Assistance Program (REAP). These 
two programs were designed as incentives to encourage members to remain 
in the Selected Reserve. Today, we will discuss, among other issues, 
whether the reserve educational assistance programs also should provide 
a post-service education benefit. I would first like to briefly 
describe the Selected Reserve force today, how the two reserve 
educational programs--as they exist today--help us maintain that force, 
and then describe various changes to these programs we would like to 
make.

              MONTGOMERY GI BILL FOR THE SELECTED RESERVE

    Just under 50 percent of members serving in the Selected Reserve 
today are within their eight-year military service obligation. Even 
those with a remaining service obligation, unless they have committed 
to service in the Selected Reserve in exchange for an incentive, can 
transfer to the Individual Ready Reserve at any time. Thus, incentives 
are an important tool in manning reserve units. To illustrate, the 
typical Infantry Brigade Combat Team (BCT) is made up of 313 officers 
of which 76 percent are company grade officers and 3,439 enlisted 
personnel of which 82 percent are E-5s or below. Data show that the 
majority of enlisted personnel (75%) who use MGIB-SR benefits are E-4s 
or E-5s, and the vast majority of enlisted personnel are pursuing an 
undergraduate degree (90%). Co. grade officers are the predominate 
users of the MGIB-SR program (70%) with 95 percent of officers pursuing 
an undergraduate or graduate degree. This is the target population we 
need to man our force.
    To sustain the All-Volunteer Force, particularly in the Guard and 
Reserve where the majority of Selected Reserve members may quit at any 
time, we need every tool available to get members to commit to service 
in the Selected Reserve. The Montgomery GI Bill for the Selected 
Reserve (MGIB-SR) helps us do that by requiring a member to commit to 6 
years of service in the Selected Reserve to gain eligibility for MGIB-
SR benefits. Of the 326,000 Selected Reserve members who made that 
commitment and are currently eligible for MGIB-SR benefits, 182,000 
(56%) are within their 6-year service obligation.

                 RESERVE EDUCATIONAL ASSISTANCE PROGRAM

    The new Reserve Educational Assistance Program (REAP) was developed 
to reward Guard and Reserve members who are being asked to serve more 
frequently and for longer periods. It was designed to provide a richer 
educational benefit to Guard and Reserve members who serve in support 
of a contingency operation. A member who serves as few as 90 days is 
eligible for $430 a month in educational assistance for up to 36 
months. The only requirement is that the member continues to serve in 
the Selected Reserve, or Ready Reserve if the member was serving in the 
Individual Ready Reserve (IRR) when he or she was called to active 
duty. The benefit level increases to as much as $860 per month if the 
member serves for 2 years. This is actually a richer benefit than the 
active duty MGIB benefit for 2 years of active duty service. This is 
because the reserve member does not have a payroll deduction to become 
eligible for the REAP benefit.
    Our most recent survey data show that 81 percent of reservists were 
full-time employees when they were activated. Twenty-eight percent 
reported that they did not return to the same employer, while eight 
percent were not in the workforce at the time they were activated. The 
survey data also show that 26 percent of reservists were enrolled in a 
civilian education program at the time of their most recent activation 
with approximately two thirds enrolled as full-time students.

                         A TOTAL FORCE GI BILL

    Last year, Congress heard testimony urging the Congress to 
consolidate the three separate educational assistance programs into a 
``Total Force GI Bill.'' In fact, legislation has already been 
introduced that would place the two reserve programs in title 38 along 
with making some modifications to each program. The Department strongly 
supports changes to the reserve educational assistance programs that 
help sustain the Reserve components and the All-Volunteer Force. But we 
adversely affect retention by offering a post-service benefit that is 
more attractive than the benefit available to those who remain in the 
force. We need to find a way to balance force management objectives 
while wisely using limited appropriations so we get the greatest return 
on tax-payer dollars.
    Certainly almost any program can be improved and we share your 
interest in ensuring that the educational assistance programs provide a 
robust benefit for the users, while giving the Department of Defense 
the tools it needs to meet force management objectives. There are a 
number of variations on a ``Total Force'' GI Bill. But, all of these 
proposals appear to have two common characteristics. First, the reserve 
education programs would be recodified in title 38 of the U.S. Code; 
placing them under the purview of the Secretary of Veterans Affairs. 
Second, the REAP program would provide a post-service benefit for 
Selected Reserve members.
    The original concept of a ``Total Force GI Bill'' was to create a 
single program drawing from the best attributes of all three 
educational assistance programs. But if the programs are to continue to 
serve the distinct purposes for which they were designed, it may be 
difficult to truly have one program. Those who call for a single 
program simply view military service as the pathway to an education 
benefit, losing sight of the fact that educational assistance programs 
help us retain members. All the proposals we have reviewed to date do 
not integrate the three programs; they simply remain three separate and 
distinct stand-alone programs that would be codified (and modified) in 
title 38.
    Some commonality among all of the programs makes sense. They should 
all provide assistance for the same education programs so, other than 
the amount paid, use of any program is transparent to the student and 
educational institution. This can be achieved by linking the benefits 
available in the title 10 programs to the benefits provided in the 
title 38 programs, just as we did when we linked the benefit rates for 
the title 10 REAP program to the title 38 MGIB rates.
    The first proposal to establish a total force GI bill was submitted 
to Secretary Nicholson by the Veterans Advisory Committee on Education 
(VACOE). Secretary Nicholson and Dr. Chu established a DVA/DOD working 
group to assess feasibility of that proposal. The working group has a 
number of concerns with the VACOE proposal so they developed an 
alternative proposal, which they presented to the Joint Executive 
Council. We have learned from the efforts of the working group that 
small changes in current education programs can translate to 
significant costs to the government. Therefore, at the last meeting of 
the Joint Executive Council, the working group was directed to more 
closely examine the recruiting and retention effects of the various 
attributes of a single program and to develop a cost-neutral 
alternative. For that reason, the working group report has not been 
officially released. But I would like to report that the working group 
has developed some intriguing ideas.

           PORTABILITY AND THE RESERVE PROGRAM BENEFIT RATES

    We are in a different time and the force is different than it was 
during World War II and Viet Nam. Today we have an All-Volunteer Force. 
People have made a choice to serve in the Guard or Reserve. As 
``citizen-soldiers,'' they serve part time. As previously noted, eighty 
percent of reservists were employed full-time when activated and 26 
percent were enrolled in school. Reintegration and readjustment are 
important to citizen-soldiers, particularly to those reservists who 
were not in the workforce when mobilized or change jobs. They have the 
opportunity to use their education benefits while still enjoying the 
benefits of continued service. We only require that they come to work 
for us 38 days a year during the first couple of years following a 1-
year mobilization. But, as the data show, most reservists are not 
beginning a new career when they are released from active duty, unlike 
their active duty counterparts. Our concern with providing portability 
is the loss of a tool that helps us retain our combat veterans. We need 
an incentive that encourages them to stay, not to leave. Our focus is 
on maintaining the All-Volunteer Force. That is why we find the 
retention aspects of both the reserve educational assistance program 
such an important attribute.
    The MGIB-SR benefit rates have been adjusted annually according the 
Consumer Price Index, as provided in statute. This is the index used 
for both the MGIB program and the MGIB-SR program. But this annual 
adjustment has not kept pace with the cost of education. The widening 
gap between the rates paid under MGIB and MGIB-SR programs is the 
result of adjustments made to one program but not the other. To restore 
the historic relationship between the two programs, the Department 
estimates it would cost just over $13 billion over the next 5 years. 
While this is discretionary spending, the Reserve components are 
required to place funds in the DOD Education Benefit Fund--money that 
is also needed to increase readiness, fund modernization and purchase 
vital equipment.

                LEGISLATION SUBMITTED BY THE DEPARTMENT

    The Department's 2008 Omnibus legislation that has been submitted 
to Congress includes a proposal that would allow a Selected Reserve 
member to continue to receive REAP payments for up to 90 days while 
serving in the Individual Ready Reserve (IRR) and retain eligibility 
for REAP for members who remain in the IRR longer than 90 days. They 
would once again be able to begin using benefits when they return to 
the Selected Reserve.

                               CONCLUSION

    Few areas, if any, are more important to the Secretary of Defense 
and the Secretaries of the Military Departments than recruiting and 
retention. We recognize our duty to fill the All-Volunteer Force with 
high-quality, motivated, and well-trained men and women. Education 
benefit programs have been a major contributor to recruiting and 
retention achievements over the past 20 years. It is our desire that 
any changes to these programs would only be undertaken if they improve 
recruitment, retention, force shaping and ultimately help us sustain 
the All-Volunteer Force.
    We welcome the opportunity to discuss these important matters with 
Congress and I look forward to working with your Committees to ensure 
that these programs remain robust. I would again like to thank the 
Committee for its continued support of the men and women of the Armed 
Forces.

                                 

Statement of the Keith M. Wilson, Director, Education Service, Veterans 
      Benefits Administration, U.S. Department of Veterans Affairs

    Good afternoon Chairwoman Herseth, Ranking Member Boozman, and 
Members of the Subcommittee. I appreciate the opportunity to appear 
before you today to discuss the two education benefit programs 
administered by the Department of Veterans Affairs (VA) for National 
Guard and Reserve members of the U.S. Armed Forces, namely, the 
Montgomery GI Bill--Selected Reserve (MGIB-SR), chapter 1606 of title 
10, United States Code, and the Reserve Educational Assistance Program 
(REAP), chapter 1607 of title 10, United States Code.
Reserve/Guard Education Benefit Programs
    The MGIB-SR provides members of the Selected Reserve with 
educational assistance, generally in the form of monthly benefits, to 
assist them in reaching their educational or vocational goals. The REAP 
provides an enhanced benefit for reservists and those in the National 
Guard who are activated for more than 90 days due to an emergency or 
contingency as defined by the President or Congress. Reservist and 
Guard education benefits support recruitment and retention efforts, and 
enhance the Nation's competitiveness through the development of a more 
highly educated and productive workforce.
Workload and Usage
    The education claims processing workload for the MGIB-SR increased 
steadily from 2001 through 2006. In 2006, VA received more than 261,000 
MGIB-SR benefit claims and 68,000 REAP benefit claims. Through the end 
of February, fiscal year 2007, we received nearly 98,000 MGIB-SR 
benefit claims and 52,000 REAP benefit claims. Comparing fiscal year 
2006 through February to the same period in fiscal year 2007, claims 
for reservist benefits under both programs have increased by 27%.
    Although the MGIB-SR original claims continued to increase by 5%, 
supplemental enrollments dropped 20%. We believe this indicates that 
former MGIB-SR recipients are converting in substantial numbers to 
REAP. The total supplemental workload for the two benefits programs has 
increased by 11%.
    The Department of Defense has informed us that, between 1986 and 
2006, more than 1.5 million Selected Reserve members gained eligibility 
for the MGIB-SR benefits. Forty-two percent of them have applied for 
educational assistance.
    In fiscal year 2006, over $122 million in benefits was paid to over 
66,000 Selected Reserve members participating in the MGIB-SR program. 
In fiscal year 2006, over $153 million in benefits was paid to almost 
24,000 REAP participants. Through the end of February, fiscal year 
2007, over $71 million in benefits was paid to more than 43,000 
Selected Reserve members participating in the MGIB-SR program, and over 
$93 million in benefits to over 28,000 REAP participants.
Performance
    This year we are making progress toward achievement of our 
performance goals. Our targets for the end of fiscal year 2007 are to 
process original claims in 35 days and to process supplemental claims 
in 15 days.
    Timeliness has improved for supplemental claims processing. Average 
days to complete MGIB-SR supplemental claims dropped from 20 days in 
fiscal year 2006 to 17 days through February of fiscal year 2007. 
Similarly, average days to complete REAP supplemental claims dropped 
from 19 days in fiscal year 2006 to 17 days through February of fiscal 
year 2007.
    Timeliness has likewise improved for original claims processing. 
Average days to complete MGIB-SR original claims decreased from 35 days 
in fiscal year 2006 to 29 days through February of fiscal year 2007. 
Average days to complete REAP original claims dropped from 60 days in 
fiscal year 2006 to 42 days through February of fiscal year 2007.
Outreach
    Expanded outreach has led to increased benefit usage. We have 
distributed more than 300,000 copies of our new REAP brochure to 
activated Guard and Reserve units nationwide. More than 46,000 REAP 
informational DVD discs are also being produced, along with almost 
65,000 informational discs on both the MGIB-Active Duty and MGIB-SR 
programs The goal is to have the informational discs distributed to all 
military installations by the end of March 2007. Additionally, we will 
soon begin direct mailing of REAP informational material to activated 
Guard and Reserve members, as we now do for Chapter 30-eligible 
servicemembers.
    Education Service will continue to enhance current outreach efforts 
to better serve the informational needs of members of the Guard and 
Reserves currently using or potentially eligible for VA education 
benefits.
Information Technology Highlights
    We continue our efforts to migrate all claims processing work from 
the legacy claims processing system into the new VA corporate 
environment. The Education Expert System (TEES) is a multi-year 
initiative that, when fully deployed, will electronically receive and 
process application and enrollment information. TEES will enable us to 
further improve both the timeliness and quality of education claims 
processing.
    The first phase of TEES implementation is the Web-Enabled Approval 
Management System (WEAMS). WEAMS is the approval repository for 
educational and job training programs; licensing and certification 
tests; and national admittance exams such as ACT, SAT, GMAT, or 
advanced placement exams maintained in the VA corporate environment. 
WEAMS, a single repository, merged two existing approval systems--the 
On-Line Approval File (OLAF), which contained approvals for educational 
and job training programs, and the Licensing and Certification Approval 
System (LACAS), which contained the approvals for licenses and 
certifications. The consolidation of these legacy applications into a 
single repository allows our education liaison representatives to 
process and maintain approval information more efficiently. Similarly, 
WEAMS frees claims examiners from searching for approvals in separate 
locations, providing more time to process education benefit claims. The 
public can now access WEAMS online to learn which programs are approved 
for VA training.
    The Web Automated Verification of Enrollment (WAVE), found at 
https://www.gibill.va.gov/wave, has been fully operational since July 
2001. This site allows individuals receiving MGIB-SR benefits to verify 
enrollment, notify VA of changes in course load, change their address, 
or establish direct deposit. Allowing beneficiaries to verify their 
continued enrollment each month over the Internet, instead of mailing 
the verification form to VA, enables them to receive their monthly 
benefits more quickly. MGIB-SR beneficiaries may also verify enrollment 
by calling our toll-free interactive voice response (IVR) telephone 
line.
    In addition, VA-ONCE, an application that allows school certifying 
officials to transmit enrollment data electronically to VA, has been in 
use since fiscal year 2003 and has been well received. In fiscal year 
2005, approximately 88 percent of all enrollment data was received 
electronically.
Conclusion
    The VA will continue to strive to ensure that the administration of 
education benefit programs is as smooth as possible on behalf of the 
honorable men and women serving our Nation who are eligible for these 
benefits, including MGIB-SR and REAP.
    Madam Chairwoman, this concludes my statement. I would be pleased 
to answer any questions you or any of the other Members of the 
Subcommittee may have.

                                 

  Statement of the Major General Terry L. Scherling, Director, Joint 
                      Staff, National Guard Bureau

    Chairman Herseth and distinguished Members of the Committee, thank 
you for the opportunity to speak to you today. I greatly appreciate 
your commitment to our Nation's veterans and am grateful for the chance 
to testify regarding the educational assistance programs available to 
the National Guard.
    As the National Guard transitions to an Operational Reserve, 
increasing its role on the global stage while maintaining its vital 
duties here at home, it is important that Guardsmen's benefits are 
commensurate with their sacrifice and their contribution. The House 
Veterans Affairs Committee is presently considering a bill which would 
change the structure of education benefits and increase their 
portability for National Guardsmen. While we greatly appreciate the 
intentions of this legislation, the ``Total Force Education Assistance 
Enhancement and Integration Act'' does contain some provisions with 
which we have some reservations.
    Since its enactment 1985, the Montgomery GI Bill has been a great 
recruitment and retention tool for the National Guard. The education 
benefits encourage Guardsmen to join, and continued service is rewarded 
with ongoing benefits. Changes to this multi-functional system should 
be made only after careful consideration.
    Under the proposed Total Force Montgomery GI Bill, members of the 
National Guard who earn eligibility while on an active duty status 
would be allowed to use that eligibility for 10 years after separation 
from the National Guard or Reserve. We believe that such a provision 
may diminish or even eliminate the benefit's retention value.
    The ``Total Force Educational Assistance Enhancement and 
Integration Act'' proposes combining the Montgomery G.I. Bill--
Selective Reserve with Montgomery G.I. Bill--Active Duty under Title 38 
to make the benefit rate structure of these programs more parallel.
    Under title 10, Reserve Components determine which servicemembers 
are eligible for Reserve Component education benefits. It is important 
that the Services retain this function since they are most able to 
identify those members who are eligible and those who should be 
suspended or terminated. Reserve Components have a vested interest in 
ensuring their servicemembers are taken care of, as it affects morale 
and ultimately retention.
    Although we have not yet assessed the full cost of the various 
proposals, such changes could result in significant costs that are not 
included in the President's Budget. For this, and previously stated 
reasons, the administration cannot support this legislation at this 
time.
    I thank the Committee for their continued work on this important 
program and for their continued support of the National Guard. I look 
forward to your questions.

                                 

 Statement of the Major General William D. Wofford, Adjutant General, 
                        Arkansas National Guard

    Chairwoman Herseth, distinguished Members of the Committee, I am 
Major General William D. Wofford, The Adjutant General, Arkansas 
National Guard. I appreciate the opportunity to speak with you today on 
education benefits for National Guard and Reserve members.
    Civilian education benefits are an integral part of our efforts to 
maintain a viable force to meet mission requirements. Individuals 
normally join the military for one of five reasons: Training, 
Education, Adventure, Money, or Service to Country. My recruiting force 
indicates that education benefits are the primary reason why 
individuals join the Arkansas National Guard.
    The Arkansas National Guard has mobilized over 85 percent of our 
total force since September 11, 2001. The Cold war strategic reserve, 
for which the National Guard and Army Reserve have been organized and 
resourced for, has evolved into an operational force that supports the 
active military every day. The increase in service and sacrifice of our 
members should be met with equitable benefits as their active 
components counterparts.
    I will focus my testimony primarily on GI Bill benefits and share a 
few brief stories.
    My first story is about a young man that served 4 years in the Army 
in the early 1970s. Even though this was during the Vietnam era, this 
young man was not called upon to serve in combat. After departing from 
the Army, this individual continued his civilian education using his GI 
Bill to further his career.
    The second story is about a young man that volunteered to serve in 
the Marine Corps and ended up serving 1 year in Vietnam with the First 
Marine Division. A few years later, this individual returned to college 
and completed his last two years of his undergraduate degree and 3 
years of medical school by using his Montgomery GI Bill benefits.
    I also want to tell you about a third young man who followed in his 
father's footsteps by joining the National Guard. Three years ago, a 
major mobilization of National Guard units occurred within the state 
and he was ``crossleveled'' from his unit into a position vacancy in 
the deploying unit. He went to the mobilization station, trained with 
his new unit, and deployed to Iraq for twelve months. He returned home 
and to his original unit in March 2005. Four months after returning 
from Operation Iraqi Freedom, his own unit was mobilized. He was not 
required or expected to return to combat--especially that soon after 
coming home. But he chose to go with his unit, as he said: ``This is my 
unit. These are my friends that I initially joined the Guard with. I 
cannot let them go into combat without me.'' Ladies and gentlemen, 
those are the kinds of great Americans that we have serving today both 
on active duty and in the reserve components. I am extremely proud to 
be able to say that young man is an Arkansas Guardsman.
    Our Guard and Reserve members are called upon more than ever to 
serve this great nation while continuing to serve the needs of their 
states. Over 8,500 men and women of the Arkansas National Guard have 
been deployed in support of the Global War on Terror (GWOT). 
Approximately 2,000 of our members have volunteered to serve in GWOT 
operations on more than one rotation. Several hundred served for an 
extended period of time in support of Operation Hurricane Katrina. 
Arkansas also currently has over 250 serving on the Southwest Border 
mission in Texas, New Mexico, and Arizona. Our state was recently hit 
by a devastating tornado and over 150 members of the Guard were called 
upon to provide support to the community of Dumas, AR.
    Service to our country has not just increased for the National 
Guard. Each quarter, a Community Council meeting is conducted at Camp 
Robinson/Camp Pike in North Little Rock, AR. Camp Robinson is the 
headquarters of the Arkansas National Guard, while Camp Pike is the 
location for a Regional Readiness Command for the U.S. Army Reserve, 
and also the Marine Corps and Naval Reserve Center in Arkansas. One of 
the purposes of the Community Council is to provide awareness of the 
military to our civic and business leaders in Central Arkansas. During 
each meeting, the Guard and Reserve provide updates on their deploying 
and/or returning units. The civilians in the audience are not just 
local civic and business leaders; they are employers of our Guard and 
Reserve members. Some of the employers are prior servicemembers, but 
many are not. Regardless of whether or not they have previous military 
experience, they see the sacrifices being made by our Reserve Component 
members and their families. These business men and women are also 
sacrificing while their employees are deployed, yet they continue to 
stand ready to support any way they can.
    I do not want to imply that the Guard and Reserve are doing more 
than Active Component members. However, I would like to make note that 
at this time, equal service does not provide equal benefits when it 
comes to the GI Bill. In 1985, Reserve Component members were eligible 
for GI benefits that equated to 47 cents to the dollar of what their 
Active Component counterparts were entitled. Today, that ratio only 
equates to 29 cents to the dollar.
    Our Active Component counterparts are able to continue their GI 
Bill benefits after they are discharged from active service. Guard and 
Reserve members are only able to utilize GI Bill benefits while an 
active member of the Guard or Reserve. Regardless of the number of 
years of service and regardless of the number of times a Guard or 
Reserve member has been placed in harm's way in service to their 
country, they are not eligible for GI Bill benefits following their 
discharge.
    Occasionally, my office receives inquiries from parents asking why 
their son or daughter, that is a former member of the Arkansas National 
Guard and that served in Operation Iraqi Freedom, is not eligible for 
GI Bill benefits. I honestly do not have a good answer for them. In the 
end, we've lost the support of those parents and most likely we will 
not see their son or daughter re-enlist with us in the future.
    I understand that the GI Bill for the Guard and Reserve is not only 
a recruiting incentive, but also a retention tool. If a Guard member 
wants to use the GI Bill, they must maintain their membership. I agree 
that we could possibly see a decrease in the GI Bill being a retention 
tool if eligibility is extended after a member is discharged. However, 
I would like for us to think (as an example) about the shortage of 
junior officers that most Guard and Reserve forces are faced with at 
present time. One of the requirements before an officer can be promoted 
to the rank of Captain (in the Guard) is to have a four year, college 
degree. It is difficult to juggle college, civilian career, family, and 
also your Guard or Reserve membership. In many cases, we are losing 
some of our best and brightest because they are unable to meet all the 
demands of their young life.
    I believe that if the GI Bill were received based on equal benefit 
for equal service, then we would see some of our prior servicemembers 
returning to us with college degrees and some returning to us as junior 
officers.
    In closing, I would like to return to the three stories I shared 
with you earlier. The first two young men used their GI Bill to further 
their civilian education after leaving active military service. Even 
though he had not served in combat during his active duty tour, the 
first man furthered his education and later joined the Arkansas 
National Guard. He served as a battalion commander during Desert Storm 
and in various leadership positions throughout his 36 years of service. 
That individual is me.
    The second individual that continued his civilian education by 
using his GI Bill after he left the military, earned his 4 year degree, 
a medical doctorate, and later a law degree. This individual has served 
our state and nation proudly since 1996 as a Member of Congress. That 
individual is your colleague and my Congressman, the Honorable Vic 
Snyder.
    The third individual that I mentioned is Staff Sergeant (SSG) Jason 
Bowen of Battery B, 1st Battalion, 142nd Field Artillery, Arkansas Army 
National Guard. As I mentioned earlier, he was transferred from his 
unit in northwest Arkansas to fill a vacancy within the 39th Brigade 
Combat Team that mobilized and deployed to Iraq, returning in March 
2005. In August 2005, he again left his family and once again placed 
his civilian career on hold to do what he thought was right for his 
fellow Soldiers and for his country. I am thrilled to share with you 
that SSG Bowen is back home with his family again after having spent a 
total of 24 months in combat within the past three years. Now for the 
rest of this story, SSG Bowen has decided that he would like to get out 
of the National Guard so that he can pursue a civilian career without 
further interruption. I think it is extremely unfair that by getting 
out of the Guard he will lose his GI Bill education benefits, unlike 
the active component soldiers that he served with, side-by-side, during 
Operation Iraqi Freedom. The disparity in benefits is difficult to 
understand and cannot be satisfactorily explained to our Guardsmen, 
their families, or to me.
    I do not have all the answers of how to make the GI Bill more 
equitable. I do not know the cost of the proposed changes to the GI 
Bill. I can speak from my own personal experience of the opportunities 
the GI Bill gave in my life. On a larger scale, I think our communities 
would benefit as there would be an increase in higher educated members 
of our society. And in the long run, I think the military could 
possibly see prior servicemembers returning to the military with a 
higher level of civilian education.
    I thank the Committee for your hard work and dedication to our 
country and your continued support of our Armed Forces.
    This concludes my testimony. I look forward to your questions.

                                 

Statement of the Colonel Robert F. Norton, USA (Ret.), Deputy Director, 
     Government Relations, Military Officers Association of America

    MADAM CHAIRWOMAN AND DISTINGUISHED MEMBERS OF THE SUBCOMMITTEE, on 
behalf of the 362,000 members of the Military Officers Association of 
America (MOAA), I am honored to have this opportunity to present the 
Association's views on education benefits for the men and women who 
serve the nation in the National Guard and Reserve forces.
    MOAA is also an original founding member of the Partnership for 
Veterans' Education, a consortium of military, veterans, and higher 
education groups which advocate for passage of a ``total force'' 
approach to the Montgomery GI Bill to meet the needs of our operating 
forces--active duty, National Guard and Reserve--in the 21st century.
    MOAA does not receive any grants or contracts from the Federal 
government.

                           EXECUTIVE SUMMARY

    Total Force Montgomery GI Bill. Our nation's active duty, National 
Guard and Reserve forces are operationally integrated under the Total 
Force policy but reservists' educational benefits are not structured 
commensurate with the length and types of duty performed.
    MOAA strongly supports enactment of H.R. 1102 to consolidate active 
duty and reserve MGIB programs in Title 38 and align benefit rates 
according to the length and type of service performed_a Total Force 
MGIB.
Basic Reserve MGIB Benefits (Chapter 1606, 10 USC)
    MOAA urges Congress to address the growing benefit gap between the 
Reserve MGIB (Chapter 1606) and the active duty program as soon as 
possible. To support reserve component retention, MOAA also recommends 
continuous in-service usage of `Chapter 1606' benefits until exhausted.
Reserve Educational Assistance Program (Mobilization) MGIB Benefits 
        (Chapter 1607)
    MOAA recommends that Chapter 1607, 10 USC be transferred to Title 
38 and that the rate formula for the program be adjusted to provide 1 
month of active duty benefits under Chapter 30, 38 USC for every month 
mobilized.
Portability of Benefits
    MOAA urges Congress to authorize use of reserve MGIB benefits 
earned during a mobilization under contingency operation orders for a 
period of 10 years after leaving service_the same portability active 
duty veterans enjoy.
Benchmarking MGIB Benefit Rates
    MOAA urges Congress to benchmark MGIB benefit rates to keep pace 
with the average cost of education at a 4-year public college or 
university.
Background on the Evolution of the Montgomery GI Bill
    Our nation's total Armed Forces--active duty, National Guard, and 
Reserve--are operationally integrated to carry out national security 
missions, but educational benefits under the Montgomery GI Bill (MGIB) 
do not reflect this ``total force'' policy, nor match benefits to the 
length and type of service performed.
    The enactment of MGIB programs early in the All-Volunteer Force era 
sheds light on the current disconnect between the MGIB structure and 
the policies used today to ensure reserves are embedded in all military 
missions.
    Congress re-established the GI Bill in 1984. The MGIB was designed 
to stimulate All-Volunteer Force recruitment and retention and to help 
veterans readjust to the civilian world on completion of their service. 
Active duty MGIB educational benefits were codified in Title 38, 
ensuring a readjustment purpose by authorizing use for up to 10 years 
after leaving service. But the Selected Reserve MGIB program was 
codified under Chapter 1606 of Title 10, and post-service benefits were 
not authorized.
    The father of the modern G.I. Bill named for him, the late 
Representative G.V. `Sonny' Montgomery, long-time Chairman of the House 
Veterans Affairs Committee, envisioned that Guard and Reserve service 
men and women deserved to participate in the GI Bill program in 
exchange for their voluntary service. But at the time, there was 
`pushback' on the issue of ``veteran status'' for reservists. Moreover, 
leaders then did not anticipate today's routine usage of Guard and 
Reserve forces for active duty missions. Some groups felt that 
reservists who had not served on active duty had not earned veterans 
(readjustment) benefits. Chairman Montgomery forged a compromise that 
resulted in placing the new reserve GI Bill programs into the Armed 
Forces Code, Title 10.
    From the inception of the MGIB until the late 1990s, Reserve MGIB 
benefits maintained proportional parity with the basic active duty 
program, paying nearly 50 percent of active duty benefit rates. 
Subsequently, active duty rates were increased significantly, but the 
Reserve benefits were not--largely because they were under a different 
Committee's jurisdiction. Erosion of Reserve MGIB value relative to 
that of the active duty program began to occur at the very time that 
hundreds of thousands of Guard and Reserve servicemembers were being 
called up following the September 11, 2001 attacks.
    The administration attempted to rectify the growing benefit gap by 
proposing legislation for a new Reserve MGIB for reservists activated 
for more than 90 days for a contingency operation. But the complexity 
of the new program (enacted as Chapter 1607, 10 USC), coupled with 
inadequate funding, poor correlation with other MGIB programs and the 
absence of a portability feature, has compromised statutory objectives 
for the MGIB as envisioned by Sonny Montgomery.
    A new architecture is needed to align the MGIB with the realities 
of the Total Force policy in the 21st Century.
Toward a Total Force MGIB for the 21st Century.
    The Total Force MGIB has two broad concepts. First, all active duty 
and reserve MGIB programs would be consolidated under Title 38. DOD and 
the Services would retain responsibility for cash bonuses, MGIB 
``kickers'', and other enlistment/reenlistment incentives. Second, MGIB 
benefit levels would be structured according to the level of military 
service performed.
    The Total Force MGIB would restructure MGIB benefit rates as 
follows:

      Tier one--Chapter 30, Title 38--no change. Individuals 
who enter the active armed forces would earn MGIB entitlement unless 
they decline enrollment.
      Tier two--Chapter 1606, Title 10--MGIB benefits for 
initial entry into the Guard or Reserve. Chapter 1606 would transfer to 
Title 38. Congress should consider adjusting benefit rates in 
proportion to the active duty program. Historically, Selected Reserve 
benefits have been 47-48% of active duty benefits.
      Tier three--Chapter 1607, Title 10, amended--MGIB 
benefits for mobilized members of the Guard/Reserve on ``contingency 
operation'' orders. Chapter 1607 would transfer to Title 38 and be 
amended to provide mobilized servicemembers 1 month of ``tier one'' 
benefits (currently, $1075 per month) for each month of activation 
after 90 days active duty, up to a maximum of 36 months for multiple 
call-ups.

    A servicemember would have up to 10 years to use remaining 
entitlement under Tier One or Tier Three programs upon separation or 
retirement. A Selected Reservist could use remaining Second Tier MGIB 
benefits only while continuing to serve satisfactorily in the Selected 
Reserve. Reservists who qualify for a reserve retirement or are 
separated / retired for disability would have 10 years following 
separation to use all earned MGIB benefits. In accordance with current 
law, in cases of multiple benefit eligibility, only one benefit would 
be used at one time, and total usage eligibility would extend to no 
more than 48 months.
    MOAA strongly supports enactment of H.R. 1102 to consolidate 
military/veteran MGIB programs in Title 38 and align benefit rates 
according to the length and type of service performed, a Total Force 
MGIB.
 GI Bill Benefits for Members of the Selected Reserve
    The Total Force MGIB concept outlined above would drive particular 
changes in the Selected Reserve MGIB programs.
    Basic Reserve MGIB Program (Chapter 1606). For the first 15 years 
of the Reserve MGIB program's existence, benefits earned by individuals 
who initially join the Guard or Reserve for 6 years or who reenlist for 
6 years, paid 47 cents to the dollar for active duty MGIB participants. 
Since 9/11, however, the ratio has dropped to 29 cents to the dollar. 
One consequence of the rate drop is that reservists feel their service 
is devalued. The following chart illustrates the sharp decline in rate 
parity since 9/11.


                        Montgomery GI Bill Program Benefit History_Full Time Study Rates
----------------------------------------------------------------------------------------------------------------
                                                  Month Year       Active Duty     Selected Reserve
                                                                   Chapter 30        Chapter 1606
----------------------------------------------------------------------------------------------------------------
                                                Jul    1985             $300.00            $140.00       47%
                                                       1986             $300.00            $140.00       47%
                                                       1987             $300.00            $140.00       47%
                                                       1988             $300.00            $140.00       47%
                                                       1989             $300.00            $140.00       47%
                                                       1990             $300.00            $140.00       47%
                                                Oct    1991             $350.00            $170.00       49%
                                                       1992             $350.00            $170.00       49%
                                                 Apr   1993             $400.00            $190.00       48%
                                                Oct    1994             $404.88            $192.32       48%
                                                Oct    1995             $416.62            $197.90       48%
                                                Oct    1996             $427.87            $203.24       44%
                                                Oct    1997             $439.85            $208.93       48%
                                                Oct    1998             $528.00            $251.00       48%
                                                Oct    1999             $536.00            $255.00       48%
                                                Oct    2000             $552.00            $263.00       48%
                                                  Nov  2000             $650.00            $263.00       40%
                                                Oct    2001             $672.00            $272.00       40%
                                                 Dec   2001             $800.00            $272.00       34%
                                                Oct    2002             $900.00            $276.00       31%
                                                Oct    2003             $985.00            $282.00       29%
                                                Oct    2004            $1004.00            $288.00        28.6%
                                                Oct    2005            $1034.00            $297.00        28.6%
                                                Oct    2006            $1075.00            $309.00        28.7%
----------------------------------------------------------------------------------------------------------------


    MOAA urges Congress to address the growing benefit gap between the 
Reserve MGIB (Chapter 1606) and the active duty program as soon as 
possible. The Partnership also recommends continuous in-service usage 
of Chapter 1606 benefits until exhausted.
    Reserve Educational Assistance Program (Mobilization) Benefits 
(Chapter 1607). REAP educational benefits are earned by mobilized 
reservists who serve the nation on active duty for at least ninety days 
during a national emergency under `contingency operation' orders. The 
REAP benefit package was cobbled together with little consultation / 
coordination with the Departments of Defense and Veterans Affairs, and 
other stakeholders. For example, the benefit rate structure is based on 
an administratively cumbersome percentage of active duty MGIB Chapter 
30 benefits. Ironically, substantial benefits are awarded after 90 days 
service, but no post-service access to those benefits is authorized.
    The Total Force MGIB would address these concerns by establishing 
in law month-for-month entitlement to active duty MGIB benefits 
(Chapter 30). With enactment of a portability feature for earned REAP 
benefits, the program ultimately would be fairer to all members of the 
force and serve as an incentive for continued service in the Guard or 
Reserves.
    A restructured REAP would support DOD policy of calling up the 
``operational reserve'' for no more than 12 months per tour every five 
or 6 years. The proposal would enable a G-R member to potentially 
acquire full MGIB entitlement after 36 months aggregate service on 
contingency operation orders. Presently, Chapter 1607 benefits are only 
awarded for a single tour of active duty. Additional service offers no 
additional benefit, even though over the course of a 20 year Guard or 
Reserve career, reservists will serve multiple tours of active duty. 
Under the Total Force MGIB, the more one serves the more MGIB 
entitlement is earned.
    MOAA recommends that Chapter 1607, 10 USC be transferred to Title 
38 and that the rate formula for the program be adjusted to provide 1 
month of active duty benefits under Chapter 30, 38 USC for every month 
mobilized.
    Portability of Benefits. A key element of H.R. 1102 is that 
reservists mobilized for at least 90 days under federal contingency 
operation orders would be able to use remaining REAP benefits under 
Chapter 1607 after separation. That is, they would be entitled to post-
service readjustment benefits under the MGIB. Some government officials 
are concerned, however, that this proposal would hurt National Guard 
and Reserve reenlistment and retention programs.
    MOAA offers the following observations for the Subcommittee's 
consideration. America's volunteer military--active duty and reserve 
component--become veterans when they complete their active duty service 
agreements. For mobilized reservists, when they return from an active 
duty call-up (under contingency operation orders) they are veterans, 
and no American would dispute that fact, no less their sacrifice. Why 
then should they be treated as second-class citizens for purposes of 
the MGIB? If an active duty member who serves 2 years on active duty 
and one tour in Iraq may use MGIB benefits for up to 10 years after 
leaving service, do we not owe equal treatment to a Guard or Reserve 
member who serves two or more years in Iraq over a period of six or 8 
years of Guard/Reserve service?
    DOD's own survey of reserve component members (DOD Status of Forces 
Survey, November 2004) indicates that ``education'' is not a key 
component in extension or reenlistment decisions. Moreover, a 
reenlistment or extension decision enables the service member to retain 
original Reserve MGIB benefits (currently, Chapter 1606) as well as the 
potential to earn more active duty MGIB entitlement through successive 
call-ups. That's not possible under the REAP program today. Reservists 
who choose to remain in the Selected Reserve and are subsequently 
activated would earn 1 month of active duty MGIB benefits for every 
month mobilized, up to 36 months of benefits, under the Total Force 
MGIB proposal. Under H.R. 1102, they would still have up to 12 months 
remaining usage under Chapter 1606, since current law allows dual-
benefit accrual up to 48 mos. maximum entitlement. In short, there is a 
built-in incentive to continue serving in the Selected Reserve because 
of the potential to earn more MGIB entitlement under H.R. 1102.
    Over the 21-year history of the MGIB, no research has shown that 
active duty veterans ``get out'' because of the MGIB. Many valid 
personal and family reasons drive these volunteers' decisions to serve 
or not to serve. To argue that mobilized reservists should be treated 
differently is unfair and an insult to their spirit of voluntarism.
    MOAA urges the Subcommittee to endorse the provision in H.R. 1102 
that would allow post-service access to reserve MGIB benefits earned 
during a mobilization under contingency operation orders for a period 
of 10 years after leaving service_the same portability active duty 
members enjoy.
    $1,200 MGIB Enrollment ``Tax''. The MGIB is one of the only 
government-sponsored educational programs in America that requires a 
student to pay $1,200 (by payroll reduction during the first 12 months 
of military service) in order to establish eligibility. The payroll 
deduction is nothing more than a penalty that must be paid for before 
the benefit is received. Sadly, this fee causes some enlisted 
servicemembers to decline enrollment simply because they are given a 
one-time, irrevocable decision when they are making the least pay and 
are under the pressure of basic military training.
    Those who decline enrollment--many due to financial necessity--do 
not have a second chance to enroll later. This is a major heartburn 
item from our lowest-ranking volunteers entering military service. New 
recruits feel tricked when they enter service and learn they must 
forego a substantial amount of their first year's pay to enroll in the 
MGIB. The practice sends a very poor signal to those who enter service 
expecting a world-class educational benefit.
    MOAA has not adopted a formal position on this issue at this time, 
but we recommend that Congress address the long-term impact of an MGIB 
access ``tax'' in consolidating MGIB programs for the 21st century.
    Benchmarking MGIB Rates to the Average Cost of Education. 
Department of Education data for the 2005-2006 academic year show the 
MGIB reimbursement rate for full-time study covers about 80%* of the 
cost at the average public 4-year college or university (* percentage 
reflects average costs only for tuition, room, board; does not include 
actual expenses to veterans of commuting, living costs, or books and 
supplies).
    MOAA urges Congress to benchmark MGIB benefit rates to keep pace 
with the average cost of education at a 4-year public college or 
university.
    Transferability of Benefits for National Guard and Reserve 
Servicemembers. Under current law, the Services may offer service men 
and women in designated skills the option of transferring up to half of 
their remaining MGIB entitlement to eligible dependents in exchange for 
a reenlistment agreement at the sixth year of service. The Army 
recently opened `transferability' in certain skills. MOAA has long 
endorsed transferability but we believe the authority would be more 
useful for readiness as a career retention incentive at the 12 to 14 
years' service point. Moreover, we note that transferability is not 
available to National Guard and Reserve service men and women in the 
Reserve MGIB programs (Chapters 1606 and 1607, 10 USC).
    This is yet another example of the disconnect between the reserve 
and active duty MGIB programs due in large measure to separate 
jurisdictions within Congressional committees.

                                 

     Statement of Joseph C. Sharpe, Jr., Deputy Director, Economic 
                      Commission, American Legion

    Mr. Chairman and Members of the Subcommittee:
    The American Legion appreciates the opportunity to share its views 
on education benefits for members of the National Guard and Reserve 
component.

                 EDUCATION AND THE TOTAL FORCE GI BILL

    Historically, The American Legion has encouraged the development of 
essential benefits to help attract and retain servicemembers into the 
Armed Services, as well as to assist them in making the best possible 
transition back to the civilian community. The Serviceman's 
Readjustment Act of 1944, the ``GI Bill of Rights'' is a historic piece 
of legislation, authored by The American Legion, that enabled millions 
of veterans to purchase their first homes, attend college, obtain 
vocational training, receive quality health care and start private 
businesses. The emergence of the American middle class, the suburbs, 
civil rights, and finally a worldwide economic boom can be attributed, 
in part, to this important social legislation.
    The majority of individuals who join the National Guard or Reserves 
enter the Armed Forces straight out of high school, and many are full 
or part time college students.
    With the number of activations of the Reserve component since 
September 11, 2001, these same Reservists, who are attending colleges 
and universities around the country, are discovering that their actual 
graduation date may be extended well past their initial anticipated 
graduation date. It's also taking longer for students to graduate, 
raising the overall cost of a college degree. The average public 
university student now takes 6.2 years to finish.
    Under current law, members of the Reserve component face many 
challenges in using the MGIB-SR benefits. Since September 11, 2001, the 
utilizations of the Reserve components to augment the Active Duty Force 
(ADF) presents complications for those members of the Guard and 
Reserves enrolled in college programs. The uncertainty associated with 
unit activations, lengthy activations, individual deactivations, and 
multiple unit activations makes utilization of educational benefits 
extremely difficult. Such decisions as whether to enroll for a 
semester; long-range planning for required courses, or whether to 
finish a semester are among the challenges confronted. One local 
Reservist, who completed a 14-month tour in Iraq, withdrew from college 
after 9/11 because he was told his unit would soon be deploying. He 
began to accrue student loan debt, falling behind peers in studies, and 
limbo status due solely to the military's indecisions.
    Due to the Global War on Terror and his military service, he had 
missed 3 full years of collegiate studies and watched his academic 
peers graduate. Finally, this Reservist graduated in August 2005 from 
the University of Maryland, 8 years after beginning his post secondary 
education. The other half of this travesty is that he accumulated 
$50,000 in student loan debt.
    When servicemembers return to civilian life, they often return in 
the middle of a semester and are unable to start school for several 
months. This is because for 9 months out of the year, universities are 
in their lengthy Fall and Spring semester terms; these young men and 
women can't restart their academic careers until the next term starts. 
Additionally, some required courses are only offered at certain periods 
of the year. Meanwhile, they cannot live in campus housing because they 
are ineligible due to not being enrolled for that term.
    It is important to note that tuition and fees represent only a 
fraction of the total cost of attending college. The overall cost 
(tuition, fees, room, board, books, including transportation) of a 
typical public college is about $16,400 a year. (College Board)
    When living costs and other education-related expenses are 
considered, tuition and fees constitute 67 percent of the total budget 
for full-time students enrolled in 4-year private colleges and 
universities, 36 percent of the budget for in-state residential 
students at public 4-year institutions, and only 18 percent of the 
budget for 2-year public college students commuting from off-campus 
housing.
    Furthermore, there is a large disparity between veterans' education 
benefits and actual costs of top universities. The top 124 schools as 
listed in the U.S. News and World Report have an average tuition and 
fees of $24,636, and room and board rates of $8,610, totaling $33,246 
for 1 year. The total equates to approximately 86 percent of the entire 
36-month full rate MGIB-Active Duty (MGIB-AD) benefit. The top 10 
schools on this list have an average cost per year of $43,123 which 
equates to 111 percent of the entire 36-month full rate MGIB-AD 
benefit.
    Reservists are not able to use benefits due to deployments and are 
simultaneously becoming ineligible due to completing their Selected 
Reserve commitment. The following chart reflects the percentage change 
of those who use their education benefits compared to the years prior 
from 2000 to 2006. The striking graphic shows that in the past year 
(2006), usage has dropped tremendously. Two key factors are increased 
deployments and termination of service in the Selected Reserve.

[GRAPHIC] [TIFF OMITTED] T4312A.001


----------------------------------------------------------------------------------------------------------------
                                                           YEAR     TOTAL       MGIB-AD      MGIB-SR      REAP
----------------------------------------------------------------------------------------------------------------
Total Trained during
  year (AD/SR/REAP)                                        2005    423,442       336,281       87,161
----------------------------------------------------------------------------------------------------------------
Total Trained Compared
  to previous year
  (AD/SR/REAP)                                             2005      3.11%         4.43%       -1.71%
----------------------------------------------------------------------------------------------------------------
Total Trained during
  year (AD/SR/REAP)                                        2006    422,036       332,184       66,105    23,747
----------------------------------------------------------------------------------------------------------------
Total Trained Compared
  to previous year
  (AD/SR/REAP)                                             2006     -0.33%        -1.23%      -31.85%      100%
----------------------------------------------------------------------------------------------------------------


    There are no current figures that illustrate how many reservists 
and National Guard members remain eligible.

                    BACKGROUND OF THE RESERVE FORCE

    In the 20 years since the MGIB went into effect on June 30, 1985, 
the nation's security has changed radically from a fixed Cold war to a 
dynamic Global War on Terror. In 1991, the active duty force (ADF) of 
the military stood at 2.1 million; today it stands at 1.4 million. 
Between 1915 and 1990 the Reserve Force (RF) was involuntarily 
mobilized only nine times.
    There is now a continuum of service for military personnel, 
beginning with those who serve in the Reserve component only, extending 
through those in the Reserve component who are called to active duty 
for a considerable period of time, and ending with those who enlist in 
the ADF and serve for a considerable period of time. Since 9/11 more 
than 600,000 members of the 860,000-member Selected Reserve have been 
activated.
    Today, approximately 40 percent of troops in Iraq are Guard 
personnel or Reservists. Despite this, both the MGIB-AD and the MGIB-SR 
still reflect benefits awarded 20 years ago with increases well behind 
the annual educational inflation rate. The Reserve component members 
rarely served on active duty at that time. The idea that any projection 
of U.S. power would require the activation of at least some Reservists 
was never considered in creating these programs.

                          TOTAL FORCE GI BILL

    Currently, The American Legion is advocating in support of the 
Total Force GI Bill. One major selling point of this proposal is the 
portability of education benefits. This proposed legislation will allow 
Reservists to earn credits for education while mobilized, just as 
active-duty troops do, and then use them after they leave the military 
service.
    Current law gives troops who serve on active duty three or more 
years to collect up to $1,075 a month for 36 months as full-time 
students totaling $38,700. That benefit is available up to 10 years 
after discharge.
    Reserve and Guard personnel can earn percentages of the full time 
active duty rate depending on length of their mobilization. If they are 
mobilized for 15 months--the average length of deployment--and then go 
to school full time, they can only receive up to a maximum of $23,220 
using their Reserve Education Assistance Program (REAP) benefits. 
However, they can collect only if they remain in a Guard or Reserve 
unit. If they go into the inactive Reserve (Individual Ready Reserve) 
or are discharged, they no longer are eligible for education benefits.
    Some unofficial cost estimates of the Total Force MGIB run as high 
as $4.5 billion for the first 10 years, although the Congressional 
Budget Office has yet to provide detailed figures.
    The Total Force MGIB plan would also call on Congress to combine 
statutory authority for both MGIB-AD and MGIB-SR programs under the 
Department of Veterans Affairs (VA) (Chapter 30 of Title 38 of the U.S. 
Code). This would mean moving MGIB-SR programs from the Department of 
Defense (Chapter 1606 of Title 10 of the U.S. Code) and shifting 
oversight responsibility to VA.
    The plan also would call for simplifying MGIB benefit levels and 
features into three tiers.
    Tier one would be MGIB-AD. Benefits for full time students are 
currently $1075 a month for 36 months of college or qualified 
vocational training.
    Tier two would be MGIB-SR for drilling members who enlist for 6 
years. But MGIB-SR would be raised to equal 47 percent of MGIB-AD and 
kept there. For years, Congress adjusted the MGIB-SR in lock step with 
MGIB-AD, staying at 47 percent of active duty rates. Since 1999, the 
Committees on Armed Services and Defense officials have failed to 
adjust the rates. As a result, the current MGIB-SR benefit for full 
time students is $309 a month, or just 29 percent of MGIB-AD.
    Tier three would be MGIB benefits for activated Reservists, but 
with changes to the Reserve Education Assistance Program (REAP) that 
Congress enacted in 2004. Technical problems had delayed the full 
implementation of REAP. REAP provides extra MGIB benefits to Reservists 
mobilized for 90 days or more since September 11, 2001. Payments are 
40, 60 or 80 percent of MGIB-AD, depending on length of activation. As 
with MGIB-SR, REAP provides 36 months of benefits, but they end if the 
Reservist leaves military service.
    Under Total Force MGIB, activated Reservists would get 1 month of 
benefits, at the active duty rate, for each month of mobilization up to 
36 months. Members would have up to 10 years to use active duty or 
activated Reserve benefits (Tiers one and three) from the last date of 
active service. A Reservist could also use any remaining MGIB-SR 
benefits (Tier two), but only while in drill status or for up to 10 
years after separation, if the separation is for disability or 
qualification for retirement.

                               CONCLUSION

    As the distinctions between the active and Reserve forces continue 
to fade, the difference between the active and Reserve forces of the 
MGIB should disappear accordingly. Benefits should remain commensurate 
with sacrifice and service. The American Legion agrees with the concept 
of the Total Force MGIB, which is designed to update the MGIB by 
incorporating the new security realities of this current open-ended 
Global War on Terror.
    Therefore, The American Legion, which has a proud history of 
advocating for increased educational benefits to members of the Armed 
Forces, supports the ``Total Force Educational Assistance Enhancement 
and Integration Act of 2007.'' The bill would modernize the MGIB 
benefits to more effectively support armed forces recruiting, 
retention, and readjustment following service, and to better reflect a 
``Total Force'' concept that ensures members of the Selected Reserve 
receive educational benefits that match their increased service to the 
nation.

                                 

  Statement of the Honorable Roscoe G. Bartlett, a Representative in 
                  Congress from the State of Maryland

    Madame Chairwoman, I appreciate the opportunity to submit a 
statement for the record at this hearing by the Economic Opportunity 
Subcommittee of the House Committee on Veterans' Affairs concerning 
education benefits for members of the National Guard and Reserves.
    I would like to introduce you to the bill that I have introduced, 
H.R. 81, the Bartlett Montgomery GI Bill Act. With military retention 
and morale at risk, we need to support our troops and servicemembers 
with additional incentives to stay in the military. This bill would 
encourage Active Duty and Reserve servicemembers to re-enlist, support 
military families and provide more realistic rates of educational costs 
for higher learning by permitting servicemembers to transfer unused GI 
education benefits to their spouses or children. This is a 
reintroduction of H.R. 3625 from the 109th Congress.
    In general, this bill would amend the Montgomery GI Bill 
educational assistance program to allow an individual who has completed 
6 years of service in the Armed Forces and enters into an agreement to 
serve at least four more years to transfer their educational assistance 
entitlement to their spouse, child, or a combination therein.
    More specifically the bill would:
    Direct the Secretary of Veterans Affairs to provide a percentage 
annual increase in the rates of such educational assistance based on 
the average monthly costs of higher education.
    Authorize reimbursement of reductions in basic pay for educational 
assistance coverage in the case of extended active-duty service.
    Provide similar eligibility for the transfer of educational 
assistance for members of the Selected Reserve who have completed at 
least 6 years of service and enter into an agreement to remain a member 
of such Reserve for at least four more years.
    Provide educational assistance eligibility credit for cumulative 
active-duty service in the Selected Reserve.
    Increase the rates of educational assistance under the Reserve 
Montgomery GI Bill.
    Apply an annual adjustment to the rates of survivors' and 
dependents' educational assistance.
    Thank you again Madame Chairwoman for the opportunity to bring H.R. 
81 to the attention of my colleagues serving on the Subcommittee on 
Economic Opportunity.

                                 

 Statement of the Honorable Christopher P. Carney, a Representative in 
                Congress from the State of Pennsylvania

    Thank you, Chairwoman Herseth and Ranking Member Boozman for 
holding this important hearing regarding education benefits for 
National Guardsmen and members of the Selected Reserve.
    I have introduced bipartisan legislation that would extend the GI 
Bill for National Guard or Reserve members to have up to 10 years after 
completing military service to pursue a higher education. This bill 
extends a much deserved and needed benefit to our troops. The GI Bill 
has provided education to many of our nation's fine and honorable men 
and women, this bill will give the National Guard and Reserve members 
up to 10 years to take advantage of this benefit.
    Because the National Guard and Reserve are playing an ever more 
increasing role in combat operations, they are finding it harder to 
achieve their degree while enlisted. H.R. 1330 will better allow troops 
to serve their country honorably and reward themselves with a higher 
education when finished. We owe this to our troops and our military 
families back home.
    Thank you for the opportunity to contribute to today's hearing. As 
a veteran and Lt. Commander still serving in the Navy Reserves, I look 
forward to working with this committee in support of better educational 
benefits for Reservists and National Guardsmen.

                                 

 Statement of the Honorable Jim Matheson, a Representative in Congress 
                         from the State of Utah

    Thank you, Chairwoman Herseth and Ranking Member Boozman for 
holding this important hearing regarding education benefits for 
National Guardsmen and members of the Selected Reserve.
    At a time when our Nation and our military is increasingly relying 
upon Reservist contributions for extended periods of time, I don't 
think that we can overstate the importance of evaluating and improving 
key benefits such as educational assistance. There is no doubt in my 
mind that Congress should take a comprehensive look at the Montgomery 
GI Bill and look for ways to provide our soldiers with better benefits.
    For my part, I have introduced legislation for the past three 
Congresses--the Resume Education After Defense Service Act, known as HR 
1211 in this session--in order to address one problem with the current 
GI Bill.
    Back in 2003, a group of Marine Corps Reservists from Utah came to 
me and asked for help. After two separate activations, including a tour 
in Iraq, these soldiers served 24 months on active duty in the Marine 
Corps. When they finally returned home, it was to find out that they 
fell under a loophole within the Montgomery GI Bill. They were 
ineligible for full active duty educational benefits because while they 
served the required 24 months on active duty, their months of service 
were not consecutive.
    To me, this seemed like an unacceptable technicality--if our 
soldiers serve two full years on active duty, it shouldn't matter 
whether service is consecutive or cumulative. As you all know, under 
current operational cycles, many Reservists are activated for 1 year, 
demobilized for a year, then recalled--all but eliminating the 
opportunity to be on active duty for two consecutive years. We're even 
at a point where some Guardsmen and Reservists are doing their third 
and fourth tours in Iraq.
    In order to address this problem, my legislation extends Title 38 
Montgomery GI Bill benefits to Reservists and Guardsmen serving at 
least 24 months of cumulative active duty service over a 5-year period. 
It will apply to Reservists activated between 9/11 and the end of 2008, 
in order to accommodate those who are serving honorably in Afghanistan 
and Iraq. This bipartisan legislation had over 150 cosponsors in the 
last Congress and I recently reintroduced it with the support of 55 
original cosponsors a couple weeks ago.
    Thank you for the opportunity to contribute to today's hearing. I 
look forward to working with this Committee in support of better 
educational benefits for Reservists and National Guardsmen.

                                 

  Joint Statement of the Reserve Officers Association and the Reserve 
                          Enlisted Association

 The Reserve Officers Association and the Reserve Enlisted Association 
  Urge the House Committee on Veterans' Affairs, Economic Opportunity 
  Subcommittee to Support Selected Reserve Education Reforms for all 
                      Reserve Component Personnel.

Those enhancements should include:
      All GI Bill funding and administration belongs under the 
jurisdiction of the Senate and House committees on Veteran Affairs.
      Include deployed Reservists under MGIB-Active to allow 
qualification by accumulating active duty time; earning up to 36 months 
of benefit at 100 percent.
      Permit continued access to MGIB-SR education throughout a 
Reservists career.
      Continues for 10 years following separation or transfer 
from the Selected Reserve in paid drill status.
      Return the MGIB-SR (Chapter 1606) to 47 percent of MGIB-
Active.
      Include 4-year as well as 6-year reenlistment contracts 
to qualify for a prorated MGIB-SR (Chapter 1606) benefit.
      Continue MGIB-SR eligibility of Reservists who are 
involuntarily transferred from pay to non-pay and continue to maintain 
qualifying years.
      Stipulate that RC personnel can use their education 
benefits while mobilized.
      Transfer unused benefits for career service-members to 
family members.
      Allow use of the MGIB benefit to pay off student loans.
Background
    Congress re-established the GI Bill in 1984. The MGIB, codified in 
USC Title 38, Chapter 30, was designed to stimulate All-Volunteer Force 
recruitment and retention and to help veterans readjust to the civilian 
world on completion of their service.
    At the same time, the Selected Reserve MGIB program was first 
codified under Chapter 1606 of USC Title 10 intended as a recruiting 
and retention incentive. Because of this post-service benefits have not 
been authorized, which can actually be a disincentive.
    Guard and Reserve members may be entitled to receive up to 36 
months of MGIB-SR education benefits. This benefit not only has a 
positive effect on the individual, but the military benefited by having 
an educated force.
    At the beginning of MGIB until the late 1990s, Reserve MGIB 
benefits maintained proportional parity with the basic active duty 
program, paying nearly 50 percent of active duty benefit rates. Yet, 
the MGIB-SR has not kept pace with national military strategy and force 
deployment policies.
    MGIB-SR began to erode as a benefit at parity just as the active 
forces began to be deployed more, and thousands of Guard and Reserve 
were recalled or mobilized to provide operational support. MGIB-SR pays 
approximately 28.5 percent of MGIB-Active.
    In 2004, Congress attempted to rectify the growing gap between 
reserve and active duty benefit rates by establishing a new MGIB 
Reserve Educational Assistance Program (REAP) for reservists activated 
for more than 90 days for a contingency operation with, Chapter 1607, 
Title 10 USC.
    To qualify for Chapter 1606 a Reserve Component member must enlist 
or reenlist for 6 years. Members eligible for Chapter 1606, when 
activated, can switch to Chapter 1607 GI Bill, which pays up to 80 
percent of the Active MGIB (Chapter 30), based on duration of service.
    Reserve servicemembers usually have 14 years to use their MGIB-SR 
benefits starting the first day they become eligible. This eligibility 
ends when Guard or Reserve members stop drilling with pay. If a 
demobilized Reservist stops drilling, he or she may switch from chapter 
1607 benefits back to chapter 1606 benefits for a period equaling the 
length of deployment plus 4 months. Active Duty recipients have 10 
years after separation to use their benefits.
    The incremental manner in which Chapters 30, 1606, and 1607 have 
evolved has led to inequities in educational benefits. Based on their 
service in the Global War of Terrorism both at home and abroad, today's 
military reservists deserve enhancements to their eligibility under the 
MGIB for Selected Reserves.


----------------------------------------------------------------------------------------------------------------
                                                                    Current Monthly Rates
                                                             -----------------------------------    Length of
                  Program                          USC                       \3/4\      \1/2\        Service
                                                                  Full        time       time
----------------------------------------------------------------------------------------------------------------
MGIB-Active                                        Title 38    $1,075.00    $806.25    $537.50       24-36 mos.
                                                           Chapter 30
----------------------------------------------------------------------------------------------------------------
MGIB-SR                                            Title 10      $860.00    $645.00    $430.00        2 years +
  REAP                                                     Chapter 1607                             consecutive
----------------------------------------------------------------------------------------------------------------
MGIB-SR                                            Title 10      $645.00    $483.75    $322.50         1 year +
  REAP                                                     Chapter 1607                             consecutive
----------------------------------------------------------------------------------------------------------------
MGIB-SR                                            Title 10      $430.00    $322.50    $215.00      90-364 days
  REAP                                                     Chapter 1607                             consecutive
----------------------------------------------------------------------------------------------------------------
MGIB-SR                                            Title 10      $309.00    $231.00    $153.00           6 year
                                                           Chapter 1606                              commitment
----------------------------------------------------------------------------------------------------------------


                                 

 Statement of Major General Michael A. Gorman, Adjutant General, South 
   Dakota National Guard, and Secretary, South Dakota Department of 
                     Military and Veterans Affairs

    Chairwoman Herseth and distinguished Members of the Committee, I 
regret that I am unable to appear before you in person but I would like 
to provide information I feel is of vital importance for the members of 
the National Guard concerning educational benefits for the National 
Guard and Reserve Components. I greatly appreciate your commitment to 
our Nation's veterans and am grateful for the chance to provide this 
testimony regarding the educational assistance programs available to 
the National Guard
    As you know, Congress re-established the GI Bill in 1984. The MGIB, 
codified in Title 38, Chapter 30, was designed to stimulate All-
Volunteer Force recruitment and retention and to help veterans readjust 
to the civilian world on completion of their service. The Selected 
Reserve MGIB program was first codified under Chapter 106 of Title 10 
as a recruiting and retention incentive, and because of this post-
service benefits were not authorized. Guard and Reserve members may be 
entitled to receive up to 36 months of MGIB-SR education benefits. This 
benefit not only had a positive effect on the individual, but the 
military benefited by having an educated force. The bill also served as 
a key recruiting and retention enhancement. At the beginning of MGIB 
and until the late 1990s, MGIB-SR benefits maintained proportional 
parity with the basic active duty program, paying nearly 50 percent of 
active duty benefit rates. Yet, the MGIB-SR has not kept pace with 
national military strategy and force deployment policies.
    MGIB-SR began to erode as a benefit at parity just as the active 
forces began to be deployed more, and thousands of Guard and Reserve 
were recalled or mobilized to provide operational support. An attempt 
to rectify the growing gap between reserve and active duty benefit 
rates established a new educational program (REAP) for Reservists 
activated for more than 90 days for a contingency operation under 
Chapter 1607, Title 10 USC. Members if activated can elect to receive 
REAP (Chapter 1607), which pays a set percentage of the Active MGIB 
(Chapter 30), based on duration of service.
    Servicemembers usually have 14 years to use their MGIB-SR benefits 
from the time they become eligible, however eligibility ends when a 
Guard or Reserve members stops drilling. If a Guard member or Reservist 
stops drilling after being activated he or she may receive MGIB-SR 
(Chapter 1606) for a period equaling the length of deployment plus four 
months.
    The incremental manner in which Chapters 30, 1606, and 1607 have 
evolved has led to inequities in educational benefits. Based on their 
service in the Global War on Terrorism both at home and abroad, today's 
military Reservists deserve enhancements to their eligibility under the 
MGIB for Selected Reserves.
    Those enhancements would include:

      All GI Bill funding and administration belongs under the 
jurisdiction of the Senate and House Committees on Veteran Affairs 
where veterans' education is the first priority.
      Expansion of MGIB-Active criteria to allow deployed 
Reservists to qualify for Chapter 30 by accumulating active duty 
service periods instead of viewing each period separately.
      Effective date of eligibility is when the servicemember 
elects to begin using their educational benefits and not upon entrance 
into the Selected Reserve.
      Include 4-year as well as 6-year reenlistment contracts 
to qualify for MGIB-SR.Allow use of the MGIB benefit to pay off student 
loans after completion of initial enlistment contract.

    In addition I support the concept of a Total Force GI Bill as 
outlined below:
    Replace Chapters 30, 1606 and 1607 and provide GI Bill 
reimbursement rate levels based on an individual's service in the Armed 
Forces, including the National Guard and Reserve. Create three tiers;
FIRST TIER
    This level would be similar to the current Montgomery GI Bill, 
Active Duty (MGIB-AD) 3-year rate--would be provided to all who enlist 
for active duty. Service entrants would receive 36-months of benefits 
at the Active Duty Rate.
SECOND TIER
    This level would be for all who enlist or re-enlist in the Selected 
Reserve (SelRes) this would entitle them to 36 months of benefits at a 
pro-rata amount of the active duty rate (Initial ratio in 1985 was 47%)
THIRD TIER
    This level would be for members of the SelRes and Inactive Ready 
Reserve (IRR) who are activated for at least 90 days. They would 
receive 1 month of benefit for each month on activation in addition to 
the basic tier one or tier two benefit. Payment of up to a total of 48 
months with no more than 36 months of any tier paid would match current 
VA policies for multiple entitlements. The maximum of benefit for a 
qualified SelRes member would be 36 months of tier three and 12 months 
of tier two.
    An individual would have up to 10 years to use the active duty or 
activated-service benefit from their last date of active/activated duty 
or reserve service, whichever is later. A Selected Reservist could use 
remaining second tier MGIB benefits as long as he/she were 
satisfactorily participating in the SelRes, and for up to 10 years 
following separation from the reserves in the case of separation for 
disability or qualification for a reserve retirement at age 60. Members 
need the ability to reestablish prior benefits that were lost due to 
separation when the member returns to military service.
    All provisions (e.g. additional contributions), and programs (e.g. 
accelerated payments, approved test fee reimbursement, and so forth.) 
eligible for payment under the current MGIB-AD program would be 
available under all three levels. Under this plan DOD would continue to 
be able to provide Recruitment and Retention incentives such as loan 
repayment, kickers for ``college'', and enlistment bonuses.
    RATIONALE: A major reason for this recommendation is equity for 
members of the Selected Reserve or Ready Reserve who are called to 
active duty service--equal programs and opportunities for equal service 
to country.
    The proposal also provides an additional recruitment incentive to 
the Selected Reserve Forces since the new program would include a 
transition and readjustment provision for members who are activated for 
more than 90 days.
    Placing the Total Force GI Bill within Title 38 USC will greatly 
simplify the administration of the (GI Bill) educational assistance 
program for all members of the armed services, both Active Duty and 
Reserve Forces, as well as ensure that all future benefits are upgraded 
equitably.
    The GI Bill has traditionally been viewed as a grateful Nation's 
way of showing its appreciation for the sacrifices of service, 
separation, and combat. The new Total Force GI Bill reflects the new 
realities which have transformed this Nation's security environment 
since 9/11/2001.
    Another area of concern that I would like to bring to the attention 
of this Committee is the delivery of services regarding timely payment 
of the educational benefits. Over the past decade the Veterans 
Administration moved toward a regional approach to serving those 
eligible for benefits and their service partners. In theory, it would 
seem this approach makes better use of limited resources but this 
system has not delivered as intended and those eligible individuals are 
suffering.
    Generally an initial claim requires a minimum of 8 to 12 weeks to 
process. This creates challenges and financial hardships for these 
young men and women who are entitled to these programs. The Veterans 
Administration has looked toward technology to solve all issues and in 
reality their service plan should include additional staff with a 
greater emphasis on training.
    I feel that an independent, comprehensive review of the claims 
processing system is necessary to identify problem areas. After 
problems are identified, the VA should provide the necessary resources 
and solutions to resolve the problem areas. If the regional approach 
does not address system accountability and reduce claims processing 
times, then the processing of claims should be decentralized.
    Thank you for the opportunity to provide this distinguished 
Committee with this vital information regarding the recommended 
enhancements to Montgomery GI Bill and the educational claims 
processing by the VA.