Stop Congress' "Tax" on Interval Pay

To many veterans, January’s enactment of the Post 9/11 Veterans Educational Assistance Improvements Act served as more of a educational benefits cut than an overall improvement. While some veterans are benefited by its enactment, many others were harmed by a reduction of tuition coverage and the removal of Interval Pay. Luckily, help is on the way if you contact Congress and let them know your thoughts. Keep reading.

Legislators have been busy at work fixing the cuts with new proposals but have so far failed to garner needed support. Currently, few legislators have heard from veterans regarding the loss of things like Interval Pay. Since the “Improvements” were spending neutral, the additional improvements were funded by cuts to other areas of veterans educational assistance.

For those who don’t know, Interval Pay is the stipend veterans receive between semesters. The cut starts this August. Up until then, when classes ended in December, veterans would continue to receive their pay until classes started in January. The same is true between Spring and Summer classes. This makes sense since many fulltime students would be unable to find work for such a short timeframe. Otherwise, the missing income for things like rent would need to be made up for via credit cards or student loans. When aggregated over a full year, the reduction of Interval Pay reduces stipend pay by almost 20 percent for fulltime students (yearly, over 8 weeks of stipend money is currently paid between classes if taking summer courses).

Legislators claimed the removal of Interval Pay was to “help” veterans extend the amount of time they use the GI Bill or Vocational Rehabilitation and Employment. They claimed veterans were running out of entitlement because of pay between classes. Therefore, removing Interval Pay would allow veterans to meet their goals. However, many veterans do not use Vocational Rehabilitation or the GI Bill for 4 year degrees. It is from this group that Congress is taking funds to pay for the overall GI Bill “Improvements.” The Congressional Budget Office pointed out that removing Interval Pay would raise an additional $2 billion. The savings would in turn be used to fund the GI Bill changes. So, instead of Congress doing the right thing and increasing funding for the benefit to include all vets, it robbed from Peter to pay Paul.

Basically, one could think of  this cut as a tax on veterans who use their benefits for vocational training or to get associates degrees. Generally, these veterans use around 24 months of benefits. Thus, they will get less of their earned benefits while in training. On average, these veterans will also have a lower earning potential after training than veterans obtaining 4-year degrees who also receive all of their available months of educational assistance.

Plus, this “tax” hurts disabled veterans using Vocational Rehabilitation if they separated pre-9/11. Disabled veterans from Vietnam and Gulf War I reap no benefit from the “Improvements” but will lose their Interval Pay as well. So, Congress taxed the most disadvantaged veterans groups to fund the “Improvements.” But there is still hope.

The Post 9/11 GI Bill Pay­ment Restora­tion Act — H.R. 1451. On April 8, 2011, Rep­re­sen­ta­tive Susan Davis (D-CA) proposed this bill. Unfortunately, few veterans have written to their Congressmen to support it. Currently, it has two cospon­sors and has been referred to the House Com­mit­tee for Vet­er­ans Affairs. This bill would repeal the por­tion of the Post-9/11 Vet­er­ans Edu­ca­tional Assis­tance Improve­ments Act of 2010 and in effect rein­state liv­ing expense stipends dur­ing school breaks. Get moving and write your Congressman now.

Click here to com­mu­ni­cate with your elected offi­cials about this bill.

Go to www.disabledveterans.org to read more on the battle for veterans benefits.