Senate Majority Leader Harry Reid has fast-tracked a bill that would repeal legislation that reduced annual COLA increases by 1 percentage point for 'working age' retirees. (J. Scott Applewhite/AP)
Legislation that would repeal caps on annual cost-of-living adjustments for military retirees under age 62 will be considered next week by the Senate.
Majority leader Sen. Harry Reid, D-Nev., has fast-tracked a bill drafted by Sen. Mark Pryor, D-Ark., setting a procedural vote for Monday that paves the way for a vote by mid-week.
The legislation, S 1963, would repeal the portion of the Bipartisan Budget Act that will reduce annual COLA increases by 1 percentage point for “working age” retirees, starting in late 2015.
The Senate Armed Services Committee had scheduled a hearing to consider Pryor’s bill the same evening; that markup has been canceled and the full Senate instead will vote on whether to debate the bill.
The proposed legislation does not include any proposals for offsetting the loss of the expected savings from the COLA caps, $6 billion, if the caps are repealed.
Senators could offer amendments to cover the cost or pass the bill as is, without any offsets, which would add to the federal deficit.
Numerous lawmakers have offered other proposals to offset the loss of savings. Sen. Kelly Ayotte, R-N.H., has proposed closing a tax loophole that allows undocumented workers to receive tax credits for their children.
As part of a broad, $30 billion veterans’ bill, Sen. Bernie Sanders, I-Vt., proposed to pay for repealing the COLA caps by using wartime contingency funding.
Other legislators, both in the House and Senate, have introduced bills that would offset the cost of repeal by tightening regulations on U.S. companies that shelter funds in foreign tax havens; cutting Saturday postal service; blocking foreign aid to Egypt or Pakistan; and consolidating the Veterans Affairs and Defense departments’ prescription drug purchasing programs.