A controversial proposal to limit the growth of some future military retirement checks is popping up again on Capitol Hill as part of the push to overhaul the system.
Congress is moving toward an agreement to transform the current benefit into a "blended system" that would, in effect, shrink the size of payments by 20 percent while giving troops cash contributions to individual retirement investment accounts. The plan would look similar to the 401(k) accounts common in the private sector.
Yet the details of a final retirement plan remain unresolved.
The version of the military retirement proposal approved by the Republican-controlled House would revive a version of the plan known as "COLA minus 1."
But the Pentagon opposes that piece of the plan, significantly reducing its chances of becoming law.
The issue erupted with drama in late 2013 when Congress rolled out a back-room budget deal that included a provision to cap the growth of military retirement checks.
For years, retirement pay has been adjusted upward to match the government's official annual cost-of-living increase. Last year, the COLA increase was 1.7 percent, for example.
But the 2013 proposal aimed to limit that annual increase to the official COLA rate as defined by the Labor Department, minus 1 percent.
That plan called for COLA-minus-1 payments for "working age" retirees who have not reached a traditional retirement age of 62. After that, military retirement pay would snap back to levels the retirees would have seen at that age if full COLAs had been in effect for them since retirement, according to the 2013 plan.
The COLA-minus-1 plan would save the government money and erode the value of military retirement checks over time by allowing inflation to grow faster than the benefit provided.
That 2013 plan became law briefly before lawmakers responded to a groundswell of opposition and repealed it.
All proposals to change the military retirement program would affect only future recruits, not today's retirees. Service members in uniform at the time such a plan took effect could remain under the traditional system by exercising a grandfather clause.
The Republican-controlled Senate recently finalized its retirement reform proposal and did not include any reference to the COLA rate, according to a spokesman for the Senate Armed Services Committee.
The revived issue will come to a head later this year when House and Senate lawmakers form a committee to resolve differences in their bills before forwarding a final version to the White House for President Obama to sign into law.
Those 11th-hour committee discussions likely will be influenced by the Pentagon's request in early June that the COLA measure be stricken from the final plan.
Andrew Tilghman is the executive editor for Military Times. He is a former Military Times Pentagon reporter and served as a Middle East correspondent for the Stars and Stripes. Before covering the military, he worked as a reporter for the Houston Chronicle in Texas, the Albany Times Union in New York and The Associated Press in Milwaukee.
