56–634 

111TH CONGRESS REPT. 111–491 " ! HOUSE OF REPRESENTATIVES 2d Session Part 2 

NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL 

YEAR 2011 

MAY 26, 2010.—Committed to the Committee of the Whole House on the State of 

the Union and ordered to be printed 

Mr. SKELTON, from the Committee on Armed Services, 

submitted the following 

SUPPLEMENTAL REPORT 

[To accompany H.R. 5136] 

This supplemental report shows the cost estimate of the Congressional Budget Office with respect to the bill (H.R. 5136), as reported, which was not included in part 1 of the report submitted 

by the Committee on Armed Services on May 21, 2010 (H. Rept. 

111–491, pt. 1). 

U.S. CONGRESS, 

CONGRESSIONAL BUDGET OFFICE, 

Washington, DC, May 26, 2010. 

Hon. IKE SKELTON, 

Chairman, Committee on Armed Services, 

House of Representatives, Washington, DC. 

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for H.R. 5136, the National Defense Authorization Act for Fiscal Year 2011. 

If you wish further details on this estimate, we will be pleased 

to provide them. The CBO staff contact is Kent Christensen. 

Sincerely, 

ROBERT A. SUNSHINE

(For Douglas W. Elmendorf, Director). 

Enclosure. 

H.R. 5136—National Defense Authorization Act for Fiscal Year 

2011 

Summary: H.R. 5136 would authorize appropriations totaling 

$726 billion for fiscal year 2011 for the military functions of the 

Department of Defense (DoD), for certain activities of the DepartVerDate Mar 15 2010 13:03 May 27, 2010 Jkt 056634 PO 00000 Frm 00001 Fmt 6659 Sfmt 6602 E:\HR\OC\HR491P2.XXX HR491P2

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ment of Energy (DOE), and for other purposes. That total includes 

$159 billion for the cost of overseas contingency operations, primarily in Iraq and Afghanistan. The bill also would authorize an 

additional $34 billion for fiscal year 2010 for costs associated with 

those operations and for DoD relief efforts associated with the recent earthquake in Haiti. In addition, H.R. 5136 would prescribe 

personnel strengths for each active-duty and selected reserve component of the U.S. armed forces. CBO estimates that appropriation 

of the authorized amounts would result in outlays of $749 billion 

over the 2010–2015 period. 

The bill also contains provisions that would increase costs of discretionary defense programs in future years. Those provisions 

would affect force structure, DoD compensation and benefits, the 

defense health program, and various other programs and activities. 

In total, such provisions would raise costs by an average of about 

$4.5 billion annually from 2012 to 2015, assuming appropriation of 

the necessary amounts. 

H.R. 5136 contains several provisions that would affect direct 

spending. CBO estimates that, in total, those changes would decrease direct spending by $15 million over the 2011–2015 period 

and by $2 million over the 2011–2020 period. In addition, CBO and 

the Joint Committee on Taxation (JCT) estimate that the bill 

would decrease revenues by $2 million over that 10-year period. On 

balance, enacting H.R. 5136 would have a negligible net impact on 

the deficit over those 10 years. 

Because enacting the legislation would affect both direct spending and revenues, pay-as-you-go procedures apply. 

H.R. 5136 contains intergovernmental and private-sector mandates as defined in the Unfunded Mandates Reform Act (UMRA). 

CBO estimates that the aggregate costs of the intergovernmental 

mandates would not exceed the threshold established in UMRA 

($70 million in 2010, adjusted annually for inflation). CBO cannot 

determine whether the costs to the private sector of complying with 

the mandates in the bill would exceed the annual threshold ($140 

million in 2010, adjusted annually for inflation). 

Estimated cost to the Federal Government: The estimated budgetary impact of H.R. 5136 is summarized in Table 1. Almost all of 

the $760 billion that would be authorized by the bill is for activities 

within budget function 050 (national defense). Some authorizations, 

however, fall within other budget functions, including: $125 million 

for the Maritime Administration (function 400—transportation); 

$71 million for the Armed Forces Retirement Home (function 600— 

income security); and $24 million for the Naval Petroleum Reserves 

(function 270—energy). 

Basis of estimate: For this estimate, CBO assumes that H.R. 

5136 will be enacted near the start of fiscal year 2011 and that the 

authorized amounts will be appropriated, including supplemental 

appropriations for 2010. 

Spending subject to appropriation 

The bill would specifically authorize appropriations totaling 

$726.1 billion for 2011 (see Table 2). Of that amount, $566.8 billion 

would be for authorizations of regular appropriations—for ‘‘base 

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ations—as follows: $548.9 billion for DoD, $17.7 billion for DOE, 

and $0.2 billion for other programs. 

Compared to the current level of 2010 appropriations enacted for 

DoD’s base budget, the $548.9 billion that would be authorized for 

2011 represents an increase of $18.1 billion (3.4 percent). The categories of DoD funding that would receive the largest increases are 

operation and maintenance at $15.5 billion (8.4 percent), and procurement at $7.9 billion (7.5 percent). Authorizations for military 

construction and family housing would decline by $4.5 billion (19.5 

percent)—largely due to lower amounts necessary for implementing 

the most recent round of base closures—while authorizations for research and development would be reduced by $3.6 billion (4.5 percent). Funding for military pay and other programs would increase 

by $2.8 billion (2.0 percent). 

TABLE 1.—BUDGETARY IMPACT OF H.R. 5136, THE NATIONAL DEFENSE AUTHORIZATION ACT FOR 

FISCAL YEAR 2011 

By fiscal year, in millions of dollars— 

2010 2011 2012 2013 2014 2015 2010- 

2015 

SPENDING SUBJECT TO APPROPRIATION 

Authorization of Regular Appropriations for 2011, primarily for the 

Departments of Defense and Energy: 

Authorization Level ................. 0 566,804 0 0 0 0 566,804 

Estimated Outlays .................. 0 366,802 123,760 45,193 15,995 6,122 557,872 

Authorization of Appropriations for 

Overseas Contingency Operations 

and for Other Activities: 

Authorization Level 1 ............... 33,661 159,335 0 0 0 0 192,997 

Estimated Outlays .................. 7,632 91,864 60,638 22,283 6,307 1,968 190,691 

Total: 

Authorization Level ........ 33,661 726,140 0 0 0 0 759,801 

Estimated Outlays ......... 7,632 458,666 184,398 67,476 22,302 8,090 748,563 

CHANGES IN DIRECT SPENDING 2

Estimated Budget Authority ............ 0 ¥71 3 7 12 4 ¥45 

Estimated Outlays ........................... 0 3,973 ¥3,972 ¥11 ¥4 ¥1 ¥15 

CHANGES IN REVENUES 2

Taxation of Certain Disability Retirees: 

Estimated Revenues ............... 0 * * * * * * 

NET INCREASE OR DECREASE (¥) IN THE DEFICIT 

FROM CHANGES IN DIRECT SPENDING AND REVENUES 

Estimated Deficit Impact 3 .............. 0 3,973 ¥3,972 ¥11 ¥4 ¥1 ¥15 

1 The $34 billion that would be authorized for 2010 would be for costs associated with overseas contingency operations, primarily in Iraq 

and Afghanistan, and with DoD activities in Haiti following the recent earthquake in that country. That amount is in addition to the $130 billion already appropriated for those operations in Public Law 111–118, the Department of Defense Appropriations Act, 2010. 2 In addition to the changes in direct spending and revenues shown above, H.R. 5136 would have effects beyond 2015. CBO and the Joint 

Committee on Taxation estimate that over the 2011–2020 period, H.R. 5136 would decrease direct spending by $2 million and would decrease 

revenues by $2 million (see Table 4). 3 Negative numbers indicate a reduction in the deficit; positive numbers indicate the opposite. 

4 Numbers may not sum up to totals because of rounding; * = between ¥$500,000 and zero. 

Notes: The authorization levels in this table reflect amounts specifically authorized by the bill. The bill also implicitly authorizes some activities in 2012 and future years; those authorizations are not included above (but are shown in Table 3) because funding for those activities 

would be covered by specific authorizations in future years. 


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TABLE 2.—SPECIFIED AUTHORIZATIONS IN H.R. 5136 

By fiscal year, in millions of dollars— 

2010 2011 2012 2013 2014 2015 2010- 

2015 

Authorization of Regular Appropriations: 

Department of Defense: 

Military Personnel:1

Authorization Level 0 138,541 0 0 0 0 138,541 

Estimated Outlays 0 136,269 1,554 167 36 * 138,026 

Operation and Maintenance: 

Authorization Level 0 200,027 0 0 0 0 200,027 

Estimated Outlays 0 144,291 41,844 9,108 2,140 766 198,149 

Procurement: 

Authorization Level 0 112,713 0 0 0 0 112,713 

Estimated Outlays 0 28,060 40,454 24,843 10,387 4,174 107,918 

Research and Development: 

Authorization Level 0 76,473 0 0 0 0 76,473 

Estimated Outlays 0 40,677 28,091 4,983 1,377 350 75,478 

Military Construction 

and Family Housing: 

Authorization Level 0 18,745 0 0 0 0 18,745 

Estimated Outlays 0 3,060 6,883 5,082 2,101 842 17,968 

Revolving Funds: 

Authorization Level 0 2,369 0 0 0 0 2,369 

Estimated Outlays 0 1,901 346 66 38 18 2,369 

General Transfer Authority: 

Authorization Level 0 0 0 0 0 0 0 

Estimated Outlays 0 392 ¥84 ¥168 ¥84 ¥28 28 

Subtotal, Department of 

Defense: 

Authorization Level 0 548,869 0 0 0 0 548,869 

Estimated Outlays 0 354,650 119,088 44,081 15,995 6,122 539,936 

Atomic Energy Defense 

Activities: 

Authorization 

Level 2 ............... 0 11,716 0 0 0 0 11,716 

Estimated Outlays 0 11,971 4,639 1,106 0 0 17,716 

Other Programs: 

Authorization Level 3 ...... 0 220 0 0 0 0 220 

Estimated Outlays ......... 0 181 33 6 0 0 220 

Subtotal, Authorization 

of Regular Appropriations: 

Authorization Level 0 566,804 0 0 0 0 566,804 

Estimated Outlays 0 366,802 123,760 45,193 15,995 6,122 557,872 

Authorization of Appropriations for 

Overseas Contingency Operations 

and for Other Activities: 

Military Personnel: 

Authorization Level ........ 1,896 15,276 0 0 0 0 17,171 

Estimated Outlays ......... 1,701 15,101 321 8 * * 17,130 

Operation and Maintenance: 

Authorization Level ........ 25,149 114,972 0 0 0 0 140,121 

Estimated Outlays ......... 5,173 68,989 46,365 13,722 3,420 994 138,663 

Procurement: 

Authorization Level ........ 4,843 26,249 0 0 0 0 31,092 

Estimated Outlays ......... 483 5,948 12,404 7,923 2,687 904 30,349 

Research and Development: 

Authorization Level ........ 277 1,097 0 0 0 0 1,374 

Estimated Outlays ......... 59 684 488 93 23 6 1,353 

Military Construction: 

Authorization Level ........ 521 1,257 0 0 0 0 1,778 

Estimated Outlays ......... 2 316 668 476 182 74 1,718 


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TABLE 2.—SPECIFIED AUTHORIZATIONS IN H.R. 5136—Continued 

By fiscal year, in millions of dollars— 

2010 2011 2012 2013 2014 2015 2010- 

2015 

Working Capital Funds: 

Authorization Level ........ 975 485 0 0 0 0 1,460 

Estimated Outlays ......... 214 704 418 96 21 7 1,460 

Special Transfer Authority: 

Authorization Level ........ 0 0 0 0 0 0 0 

Estimated Outlays ......... 0 123 ¥26 ¥35 ¥26 ¥18 18 

Subtotal, Overseas Contingency Operations 

and for Other Activities: 

Authorization Level 33,661 159,335 0 0 0 0 192,997 

Estimated Outlays 7,632 91,864 60,638 22,283 6,307 1,968 190,691 

Total Specified Authorizations: 

Authorization Level ................. 33,661 726,140 0 0 0 0 759,801 

Estimated Outlays .................. 7,632 458,666 184,398 67,476 22,302 8,090 748,563 

1 The authorization of appropriation in section 421 for military personnel includes $10.9 billion for accrual payments for the TRICARE For 

Life program. 2 This authorization is primarily for atomic energy activities within the Department of Energy. 

3 This authorization is for the Maritime Administration ($125 million), the Armed Forces Retirement Home ($71 million), and the Naval Petroleum Reserves ($24 million). The authorized level for the Maritime Administration does not include the amounts specified in the bill for 

maritime loan guarantees or payments to shipping companies under the maritime security program because those programs are authorized for 

2011 by existing statute. 

Notes: This table summarizes the authorizations of appropriations explicitly stated in the bill—in specified amounts. Various provisions of the bill also would authorize activities and provide authorities that would result in additional costs in 2011 and in future years. Because the bill would not specifically authorize appropriations to cover those costs, they are not reflected in this table. Rather, Table 3 contains the esti- mated costs of a select number of those provisions. Numbers may not sum to totals because of rounding; * = less than $500,000. 

For DOE, the $17.7 billion that would be authorized for 2011 

represents a $1.1 billion (6.6 percent) increase over the level appropriated for 2010. 

The $159.3 billion that would be authorized for 2011 overseas 

contingency operations—primarily for military operations in Iraq 

and Afghanistan—represents a decrease of about $4.3 billion (3.3 

percent) compared to the $130 billion appropriated thus far for 

2010, plus the $33.7 billion in supplemental appropriations that 

would be authorized by the bill. Authorizations for most major categories of DoD funding would be reduced by between $0.5 billion 

and $1.5 billion; the exception is research and development, which 

would have increased authorizations totaling $0.5 billion. 

The bill also contains provisions that would increase the cost of 

defense discretionary programs in future years. Most of those provisions would affect end strength, military compensation, health 

benefits, and multiyear procurement authorities. The estimated 

costs of those provisions are shown in Table 3 and discussed below. 

The following discussion does not address the timing of outlays 

from those estimated authorizations. All such spending would be 

subject to appropriation of the estimated amounts. 

Force Structure. The bill would affect the force structure of the 

various military services by setting end-strength levels for 2011 

and the minimum end-strength authorization in permanent law. 

Under title IV, the authorized end strengths in 2011 for activeduty personnel and personnel in the selected reserves would total 

1,432,400 and 846,200, respectively. Of those selected reservists, 

about 78,900 would serve on active duty in support of the reserves. 

In total, active-duty end strength would increase by 400 and selected-reserve end strength would increase by 1,700 when compared with levels authorized under current law for 2011. 


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Active-Duty End Strength. Section 401 would authorize 7,000 additional active-duty personnel for the Army, 500 additional activeduty personnel for the Air Force, 100 fewer active-duty personnel 

for the Navy, and maintain the current authorized end strength for 

the Marine Corps, compared with authorized end-strength levels 

for 2010. However, because the Army has temporary authority to 

exceed its 2010 authorized end-strength level by 30,000 personnel 

in the years 2011 and 2012, the increase under section 401 would 

not affect Army active-duty end-strength levels until 2013. CBO estimates that the net increase in active-duty personnel—an additional 400 in 2011 and 2012 and an additional 7,400 in 2013, 2014, 

and 2015—would increase costs to DoD by $3.1 billion over the 

2011–2015 period. Those costs include the pay and benefits of the 

additional personnel, as well as costs for operation and maintenance. 

Reserve Component End Strengths. Sections 411 and 412 would 

authorize the end strengths for the reserve components, including 

those who serve on active duty in support of the reserves. Under 

this bill, the Air Force Reserve would experience an increase in end 

strength of 1,700, while the other reserve components would maintain the levels authorized in 2010. On net, the number of full-time 

reservists who serve on active-duty in support of the reserves 

would decline by 5 compared with authorized end-strength levels 

for 2010. CBO estimates that the net result of implementing those 

provisions would be an increase in costs for salaries and other expenses for selected reservists of $284 million over the 2011–2015 

period. 

Reserve Technicians End Strengths. Section 413 would authorize 

the minimum end-strength levels for dual-status military technicians, who are federal civilian personnel required to maintain 

membership in a selected reserve component as a condition of their 

employment. On net, the bill would increase the required number 

of technicians by 384 relative to the levels currently authorized. 

CBO estimates the costs in civilian salaries and expenses that 

would result from those additional military technicians would total 

$186 million over the 2011–2015 period. 

Non-dual Status Technicians. Section 414 would increase the 

maximum end strength authorized for military technicians employed by the Army National Guard in a non-dual status by 920 

above the maximum level of 1,600 for 2010. Unlike dual-status 

technicians, non-dual status technicians are not members of the Selected Reserve. CBO estimates the increase in costs for civilian salaries and other expenses for these 920 additional technicians would 

be about $70 million in 2011 and $370 million over the 2011–2015 

period. However, under an emergency hiring authority delegated by 

the Office of Personnel Management, the Army National Guard is 

currently employing about 920 such technicians over the maximum 

level for 2010. That emergency authority will expire at the end of 

fiscal year 2012. Thus, compared to the personnel level authorized 

under both the permanent authority and the expiring authority, 

CBO estimates that section 414 would authorize about 920 additional Army National Guard technicians to be employed in a nondual status starting in 2013. CBO estimates the cost for those additional technicians would be $183 million over the 2013–2015 period. 


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Coast Guard Reserve End Strengths. The bill also would authorize an end-strength level of 10,000 servicemembers in 2011 for the 

Coast Guard Reserve. Because this authorization is the same as 

that under current law, CBO does not estimate any additional costs 

for this provision. 

Compensation and Benefits. H.R. 5136 contains several provisions that would affect compensation and benefits for uniformed 

personnel. The bill would specifically authorize regular appropriations of $138.5 billion for the costs of military pay and allowances 

in 2011. For related costs due to overseas contingency operations 

(primarily in Iraq and Afghanistan), the bill would authorize the 

appropriation of an additional $15.3 billion for 2011. 

Pay Raises. Section 601 would raise basic pay for all individuals 

in the uniformed services by 1.9 percent, effective January 1, 2011. 

CBO estimates the total cost of a 1.9 percent military pay raise 

would be $1.4 billion in 2011. Compared with current law (under 

which CBO estimates the across-the-board increase that will go 

into effect on January 1 will be 1.4 percent), this section would increase the pay raise in 2011 by an additional 0.5 percent. CBO estimates that the incremental cost of this larger raise would be $377 

million in 2011 and $2.5 billion over the 2011–2015 period. 

Expiring Bonuses and Allowances. Sections 611 through 616 

would extend for another year DoD’s authority to enter agreements 

to pay certain bonuses and allowances to military personnel. Those 

bonuses and allowances are scheduled to expire on December 31, 

2010. Some bonuses are paid in a lump sum, while others are paid 

in annual or monthly installments over the period of obligated 

service. Based on DoD’s budget submission for fiscal year 2011, 

CBO estimates that extending those authorities for one year would 

cost $3.5 billion over the 2011–2015 period. 

Family Separation Allowance. Section 604 would increase from 

$250 to $285 the monthly allowance paid to servicemembers with 

dependents who are separated from their families while assigned 

to certain types of duty. Based on information from DoD, CBO estimates that about 186,000 servicemembers would earn an average 

of 12 months of family separation pay in fiscal year 2011, and that 

the provision would cost $288 million over the 2011–2015 period. 

Because CBO expects deployments for overseas contingency operations to decline over time, our estimate of the annual cost of this 

$35 a month increase in the family separation allowance similarly 

declines over time. 

Hostile Fire and Imminent Danger Pays. Under current law, DoD 

has permanent authority to pay servicemembers up to $225 a 

month for undertaking certain types of hazardous duty. DoD also 

has temporary authority (through December 31, 2010) to pay up to 

$450 a month for service in a hostile fire area and up to $250 a 

month for other types of hazardous duty. Section 618 would increase—to $260 a month—the maximum amount paid under the 

permanent authority and the maximum amount paid under the 

temporary authority for service in an imminent danger area. In addition, section 614 would extend the expiring authority by one year, 

to December 31, 2011. 

Based on information from DoD, CBO estimates that increasing 

these special pays would cost $188 million over the 2011–2015 period. (Our estimate of the cost of extending the expiring authority 


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is included in the section above on expiring bonuses and allowances.) 

Other Military Compensation Provisions. CBO estimates that certain other provisions in title VI—sections 602, 603, 632, and 671— 

would increase DoD military compensation costs by $87 million 

over the 2011–2015 period. 

TABLE 3.—ESTIMATED AUTHORIZATIONS OF APPROPRIATIONS FOR SELECTED PROVISIONS IN H.R. 

5136 

By fiscal year, in millions of dollars— 

2011 2012 2013 2014 2015 2011– 

2015 

FORCE STRUCTURE 

Active-Duty End Strengths ........................................................... 29 56 613 1,184 1,196 3,078 

Reserve Component End Strengths .............................................. 32 62 62 63 65 284 

Reserve Technicians End Strengths ............................................. 20 40 41 42 43 186 

Non-Dual Status Technicians ....................................................... 0 0 36 73 74 183 

COMPENSATION AND BENEFITS (DOD) 

Pay Raises .................................................................................... 377 509 516 525 539 2,466 

Expiring Bonuses and Allowances ............................................... 1,834 836 319 353 163 3,505 

Family Separation Allowance ....................................................... 78 64 54 47 45 288 

Hostile Fire and Imminent Danger Pay ........................................ 3 57 54 39 35 188 

Other Military Compensation Provisions ...................................... 16 18 18 18 17 87 

DEFENSE HEALTH PROGRAM 

TRICARE for Dependents .............................................................. 10 100 240 310 330 990 

TRICARE for Early Reserve Retirees ............................................. 13 19 25 31 37 125 

Hearing Exams ............................................................................. 7 10 7 5 4 33 

Neurocognitive Assessments ........................................................ 5 5 5 5 5 25 

Prohibition on Fee Increases ........................................................ 12 0 0 0 0 12 

SEXUAL ASSAULT RESPONSE PROGRAMS 

Response Coordinators and Victim Advocates ............................ 24 46 70 96 99 335 

Prevention Training ...................................................................... 20 19 17 15 15 86 

Forensic Examiners ....................................................................... 6 9 11 11 11 48 

Other Title XVI Provisions ............................................................. 2 2 2 2 2 10 

OTHER PROVISIONS 

Multiyear Procurement .................................................................. 3,423 2,900 2,399 273 28 9,023 

IMPCA Programs ........................................................................... 0 0 0 558 624 1,182 

Naval Battle Force Fleet ............................................................... 123 144 217 311 352 1,147 

Assistance to Guam ..................................................................... 198 200 202 204 206 1,010 

Insulation Retrofitting .................................................................. 160 0 0 0 0 160 

Euro-NATO Joint Jet Pilot Training Program ................................ 5 5 5 5 5 25 

Decontamination of Flamenco Beach .......................................... 15 0 0 0 0 15 

Notes: For every item in this table, the 2011 levels are assumed to be included in amounts specifically authorized to be appropriated by 

the bill (and reflected in Tables 1 and 2). Amounts shown in this table for 2012 through 2015 are not included in Tables 1 or 2 because 

authorizations for those amounts would be covered by specific authorizations in future years. 

Figures shown here may not add up to numbers in the text because of rounding; IMPCA = International Materials Protection, Control, and 

Accounting; NATO = North Atlantic Treaty Organization. 

Defense Health Program. Titles VI and VII contain several 

provisions that would affect the health care benefits provided by 

DoD. 

TRICARE for Dependents. Section 702 would expand TRICARE 

eligibility to provide coverage, up to age 26, to the dependents of 

military personnel. Under current law, dependents lose their 

TRICARE eligibility when they reach the age of 21 (or 23 if they 

are enrolled in college). Based on data from DoD, CBO estimates 

there are about 500,000 children of current and retired members 

of the armed forces who are between the ages of 21 and 26 and who 

are no longer eligible for TRICARE. However, because section 702 

would require that eligible dependents have no access to employer 


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1 Reserve component members with over 20 years of creditable service are generally prohibited 

from receiving their retirement annuities until age 60. Section 647 of the National Defense Authorization Act for Fiscal Year 2008 (Public Law 110–181) allows reserve component members 

to start receiving their annuities 90 days prior to age 60 for each 90 day increment they serve 

on active duty in support of a contingency operation. 

sponsored health coverage as a condition of participation in the 

new extended benefit, CBO estimates that only about 175,000 of 

those dependents would use the coverage. CBO based this estimate 

on Center for Disease Control statistics for employer-sponsored insurance coverage among young adults, as well as current TRICARE 

participation rates. 

Section 702 would require the Secretary of Defense to charge a 

premium in an amount not to exceed the full cost of providing the 

new benefit. Because it is not clear to what extent the Secretary 

would choose to subsidize the premiums, the cost of implementing 

section 702 is uncertain. The Secretary could choose to set the premium equal to the cost of providing the care, in which case the cost 

of this section would be minimal. Information from DoD indicates 

that the average annual cost of providing health care to people in 

this age group is about $2,000. CBO assumes the Secretary would 

subsidize about 75 percent of this amount, or about $1,500, based 

on an analysis of subsidy rates in the private sector and other government programs. Including adjustments for inflation, this would 

require appropriations for DoD and the other Uniformed Services 

of over $300 million annually when fully implemented. 

The amount of appropriations required would be lower in the 

first few years because of the time needed to establish rules and 

procedures, and because it would take time to notify and enroll eligible beneficiaries. CBO expects enrollment in the new extended 

benefit program would reach a steady state level by 2014, which 

is when people are required to have minimal health coverage under 

the Patient Protection and Affordable Care Act (Public Law 111– 

148). In total, CBO estimates section 702 would require appropriations of $990 million over the 2011–2015 period. 

TRICARE for Early Reserve Retirees. Section 643 would allow all 

former servicemembers who are receiving a retirement annuity for 

non-regular (reserve) service to become eligible for the TRICARE 

health benefit. Currently, those members are not eligible for 

TRICARE until they are at least 60 years of age. Under the early 

reserve retirement provisions of Public Law 110–181, CBO estimates that the number of former reserve members under the age 

of 60 receiving an annuity will grow from about 1,000 in 2011 to 

over 2,500 by 2015.1 CBO estimates that about 75 percent of those 

former members would use TRICARE if it were available to them, 

based on participation rates from the eligible retiree population. 

CBO estimates that the average amount needed to provide health 

benefits to former members in this age group would be about 

$16,500 per household in fiscal year 2011 and that amount would 

grow with projected inflation thereafter. In total, CBO estimates 

that section 643 would require appropriations of $125 million over 

the 2011–2015 period. In addition, this section would increase direct spending which is discussed in the section on ‘‘Direct Spending 

and Revenues’’ below. 

Hearing Exams. Section 704 would require DoD to administer 

hearing exams to all members before they deploy overseas and 


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2The military’s health care program, TRICARE, comprises nine health plans that cover uniformed service members, retirees, and their dependents in the United States and abroad. Three 

of the most commonly used plans are TRICARE Prime—a managed care option, TRICARE 

Standard—a traditional fee-for-service option, and TRICARE-for-Life—which provides wraparound coverage for Medicare-eligible beneficiaries. 

again when they return. Based on current personnel statistics from 

DoD, CBO estimates this requirement would result in about 

300,000 hearing exams per year. Based on current TRICARE reimbursement rates, CBO estimates each exam would cost about $40. 

Total amounts would be lower in the first year because of the time 

needed to establish regulations and would decrease over time, assuming the number of deployments begins to subside. In total, 

CBO estimates that this provision would require appropriations of 

$33 million over the 2011–2015 period. 

Neurocognitive Assessments. Section 722 would require DoD to 

administer neurocognitive testing—examinations that measure 

mental speed and acuity—to all members returning from deployment. Currently, such testing is administered prior to deployment 

and then again upon return only in selected circumstances. Based 

on information about the cost of administering computer-based 

neurocognitive assessments, CBO estimates expanding such testing 

would require appropriations of about $5 million per year. 

Prohibition on Fee Increases. Sections 701 and 705 would prohibit DoD from increasing any fees or copayments under the 

TRICARE plans during fiscal year 2011. Because Administration 

officials have stated their intent not to increase any fees or copayments during 2011, CBO generally does not ascribe any costs to 

those sections. The exception is a provision in section 701, which 

would prohibit DoD from increasing the daily inpatient deductible 

under the TRICARE Standard health option.2 Current law sets the 

daily maximum inpatient deductible under TRICARE Standard at 

$535. However, as of October 1, 2010, the law requires DoD to increase the deductible to an amount equal to 25 percent of the cost 

of the provided care, which CBO estimates will be about $675 per 

day, on average. Section 701 would extend the $535 deductible 

through 2011. 

Based on information from DoD, CBO estimates that beneficiaries who utilize the TRICARE Standard plan accumulate about 

325,000 inpatient days per year. However, after factoring in the 

use of other health insurance and the fact that out-of-pocket costs 

under TRICARE Standard are limited to $3,000 per year, we estimate that only about 80,000 of those days would be affected by the 

higher deductible. Therefore, CBO estimates that capping the daily 

inpatient deductible under TRICARE Standard at $535 through 

2011 would require appropriations of $12 million for that year. 

Sexual Assault Prevention and Response Program. Title 

XVI would modify and expand DoD programs designed to prevent 

and respond to sexual assault. 

Response Coordinators and Victim Advocates. Section 1642 would 

require DoD to employ at least one full-time Sexual Assault Response Coordinator (SARC) and one full-time Sexual Assault Victim Advocate for each brigade or brigade equivalent of the armed 

forces. The bill also would require that such personnel must either 

be members of the armed forces or DoD civilian employees. Information from DoD indicates that the services currently use different 


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combinations of military personnel, civilians, and contractors, employed both full- and part-time, to fill such positions. 

Assuming an average brigade size of 4,000 personnel and including the reserve forces of the military services, CBO estimates that 

implementing this provision would require approximately 900 additional civilian personnel. Approximately half of those personnel 

would be victim advocates, while the other half would include approximately 250 additional SARCs and 200 support personnel. Assuming the additional personnel would be hired over the 2011– 

2013 period and the provision is fully implemented by the beginning of 2014, CBO estimates that the provision would require appropriations of $335 million over the 2011–2015 period. Of that 

amount, approximately $10 million would be used to train and certify the additional personnel while the remainder would cover salaries and benefits. 

Prevention Training. Section 1619 would require that within one 

year of enactment, secretaries of the military departments develop 

curricula to provide training on sexual assault prevention and response to members of the Armed Forces. Based on information 

from DoD about the cost to develop previous curricula, CBO estimates that developing new training materials would cost approximately $15 million over the 2011–2013 period. In addition, the bill 

also envisions an expanded emphasis on training to prevent sexual 

assault through the education system for military professionals, 

and would require that the peer education and specialized first-responder and leadership training be included in DoD educational 

programs. While we cannot predict precisely how those requirements would be implemented by DoD, CBO based its estimates on 

similar programs, such as the ‘‘Bystander Intervention’’ training 

modules that have been conducted by the Navy and the Air Force. 

CBO expects that DoD would use such training modules to provide 

the additional training required by the bill and estimates that implementing this provision would require appropriations of $71 million over the 2011–2015 period. 

In total, CBO estimates that implementing section 1619 would 

require appropriations of $86 million over the 2011–2015 period. 

Forensic Examiners. Section 1620 would require DoD to employ 

forensic examiners to conduct sexual assault forensic exams 

(SAFE) within two years after enactment of the bill. CBO anticipates that implementing this provision would require hiring additional personnel to conduct and oversee SAFE programs at DoD 

hospitals. 

Based on discussions with the Indian Health Service, which has 

recently studied the implications of implementing SAFE programs, 

CBO anticipates that establishing this capability within DoD would 

require hiring a certified Sexual Assault Nurse Examiner at each 

of DoD’s approximately 60 hospitals. In addition, CBO anticipates 

that providing forensic exams at all of DoD’s hospital and medical 

clinics would require training and certifying approximately 600 

nurses. Assuming this provision is fully implemented by the beginning of fiscal year 2013, CBO estimates that implementing the provision would require appropriations of $48 million over the 2011– 

2015 period. 

Other Provisions in Title XVI. CBO estimates that other provisions in title XVI, including the establishment of a universal DoD 


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Sexual Assault Hotline (Section 1616) and a Sexual Assault Advisory Board (Section 1621) would require appropriations of $2 million annually over the 2011–2015 period. 

Other Provisions. Various other provisions would increase the 

cost of discretionary programs over the 2011–2015 period. 

Multiyear Procurement. Section 122 would authorize the Department of the Navy to enter into a multiyear procurement contract 

for F/A–18 E/F fighter/attack aircraft and EA–18G electronic attack 

aircraft. Multiyear procurement is a special contracting method authorized in current law (title 10, United States Code, section 2306b) 

that permits the government to enter into contracts covering acquisitions for more than one year but not more than five years, even 

though the total funds required for every year are not appropriated 

at the time the contracts are awarded. As part of such a contract, 

the government commits to purchase all items specified at the time 

the contract is signed, including those to be produced and paid for 

in subsequent years. Because multiyear procurement allows a contractor to plan for more efficient production, such a contract can reduce the cost of an acquisition compared with the cost of buying 

the items through a series of annual procurement contracts. 

The President’s budget includes a request for $2.9 billion to purchase 22 F/A–18 E/Fs and 12 EA–18Gs in 2011. In addition, the 

Navy plans to purchase another 50 of those aircraft over the 2012– 

2013 period at an additional cost of $5.6 billion. DoD has not requested multiyear procurement authority for those aircraft. 

H.R. 5136 would authorize additional appropriations of $500 million for procurement of F/A–18 aircraft over the level requested for 

2011; section 122 would direct the Navy to use those funds and the 

savings from the multiyear contract to purchase eight additional 

F–18E/F aircraft in 2011. It would further direct the Navy to use 

the savings in subsequent years to purchase additional aircraft, 

rather than reduce the amount budgeted for procurement. CBO estimates that those savings would be sufficient to purchase three 

more aircraft than the Navy plans after 2011. If the department 

enters a multiyear contract to purchase 42 aircraft in 2011 and another 53 over the 2012–2013 period, required appropriations would 

total $9 billion. 

Such contracts frequently include provisions that require DoD to 

pay for unrecovered fixed costs in the event that the contract is 

canceled before completion. Because the Navy procured F/A–18 E/ 

F aircraft under two previous multiyear contracts, CBO estimates 

that new cancellation liabilities for a third such contract would 

likely be small. 

International Materials Protection, Control, and Accounting 

(IMPCA) Programs. Section 3111 would extend by five years the 

authority to provide support to Russia and other countries to secure and eliminate nuclear weapons and to install detection equipment at international crossing points. Under current law, that authority expires in fiscal year 2013. These programs are managed by 

the National Nuclear Security Administration (NNSA). Based on 

information from the Department of Energy, CBO estimates that 

the level of appropriations to extend this authority would be about 

$1.2 billion in 2014 and 2015 with most of that amount going towards installing nuclear detection equipment. 


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Naval Battle Force Fleet. Two provisions in the bill would increase the number of ships in the battle force fleet by delaying the 

retirement of certain ships. Section 1024 would require the Navy 

to retain the U.S.S Nassau (LHA–4) and the U.S.S Peleliu (LHA– 

5) in a commissioned and operational status until the delivery to 

the Navy of their replacements (the LHA–6 and LHA–7, respectively). The Navy plans to retire the LHA–4 in 2011 and the LHA– 

5 in 2013, while the new deliveries would occur in 2013 and 2016, 

respectively. Thus, the provision would have the effect of keeping 

one additional LHA-class amphibious assault ship in the operational fleet through 2016 as compared to current plans. 

Section 1023 would require the Navy to limit the total number 

of ship retirements in a year to no more than two-thirds of the 

number of vessels planned for commissioning into the battle fleet 

in that year. This restriction would continue until the number of 

vessels in the battle force fleet reaches 313 vessels. Based on an 

analysis of the Navy’s battle force plans, and discussions with the 

Navy, CBO expects the Navy would implement this requirement by 

delaying the retirement of about 15 Oliver Hazard Perry class frigates. 

CBO estimates that the appropriations required for operating the 

additional frigates and amphibious ships at normal tempo (nearly 

3,000 steaming hours a year for both types of ships) would be $123 

million in 2011 and total about $1.1 billion over the 2011–2015 period. That amount includes the costs for sea pay, fuel, and maintenance. (Because this estimate assumes an endstrength level specified in section 401 of Title IV, CBO does not include any costs for 

additional military personnel.) A significantly lower appropriation 

would be required should the Navy decide to operate the ships in 

a ‘‘not underway’’ operating tempo (about 900 steaming hours per 

ship, on average). 

Assistance to Guam. The Government of Guam must improve its 

municipal infrastructure to prepare for the influx to the island of 

approximately 40,000 military personnel, family members, and civilian workers that will result from the relocation of U.S. forces in 

the Pacific. Section 2822 would allow DoD to provide financial assistance to Guam for that purpose. DoD plans to spend about $12 

billion to construct new facilities for its personnel, but the local 

government will also need to expand utilities, roads, port facilities, 

and other infrastructure to serve the needs of a population that is 

expected to increase by 25 percent. 

Section 2822 would authorize DoD to use existing federal programs to transfer defense appropriations to Guam through the end 

of fiscal year 2017, to help it meet the costs of increased municipal 

services and facilities. Assistance for constructing facilities would 

be capped at $500 million, but assistance for municipal services 

would not be similarly limited. Guam received about $300 million 

in funding in 2009 from 10 federal agencies other than the Department of Defense for a variety of services. If per capita funding remained constant, the expected growth in population of about 

40,000 people would increase annual assistance through those programs by almost $100 million. In total, under section 2822, assistance to Guam for construction and services would increase by $1 

billion over the 2011–2015 period, CBO estimates. 


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Insulation Retrofitting. Section 2833 would require DoD to inspect all of its facilities to determine the costs and savings that 

would accrue from retrofitting those facilities with improved insulation. It would also require the department to provide the Congress 

with an assessment of the number of DoD facilities that could be 

retrofitted at a cost equal to or less than half the estimated savings 

from those improvements and the total amount of cost and energy 

that could be saved from making the improvements. DoD is undertaking an expansive energy audit of many of its facilities in compliance with the Energy Independence and Security Act of 2007 (Public Law 110–140). The department estimates that those audits will 

cover about half of the square footage it owns. Section 2833 would 

compel DoD to analyze the rest of its facilities. Hiring engineering 

firms and energy savings contractors to conduct such audits would 

require appropriations of about $160 million in 2011, CBO estimates. 

Euro-NATO Joint Jet Pilot Training Program. Section 1204 

would require the Secretary of the Air Force to establish and maintain a demonstration scholarship program that would fund undergraduate pilot training for certain foreign personnel at the EuroNATO Joint Jet Pilot Training (ENJJPT) Program based at 

Sheppard Air Force Base. According to the Air Force, the ENJJPT 

Program currently enrolls 206 students a year but has the capacity 

to enroll as many as 256 students a year. 

Based on existing cost-sharing arrangements with participating 

countries, each country’s contribution to the total costs of the program (over $600 million in 2010) are proportional to the number 

of students it has enrolled (the U.S. share has been about 72 percent in recent years). Under this provision, we expect that the U.S. 

share would go up and that the Air Force would pay for an additional five students each year at an annual level of about $1 million per student. On that basis, CBO expects providing those scholarships would require appropriations of about $25 million over the 

2011–2015 period. 

Decontamination of Flamenco Beach. The Military Construction 

Authorization Act, 1974, prohibits the use of the former naval bombardment range on Culebra, Puerto Rico, for any purpose that 

would require decontamination and removal of expended ordnance. 

Section 2814 would waive that prohibition to allow the Army Corps 

of Engineers to clean up a part of that bombardment area known 

as Flamenco Beach and study the extent of and the cost to remove 

unexploded ordnance from the remainder of the bombardment 

area. Based on information from the Army Corps of Engineers, 

CBO estimates that the authorized cleanup and the study of the 

remaining area would require the appropriations of $15 million 

over the 2011–2015 period. 

Direct spending and revenues 

Several provisions in H.R. 5136 would affect direct spending. 

CBO estimates that, on net, those provisions would decrease direct 

spending by $2 million over the 2011–2020 period. In addition, one 

provision (which would affect retirement pay for certain retirees 

with over 30 years of service) would lower revenues by $2 million 

over the 2011–2020 period. The net impact on the deficit over that 

period would be insignificant (see Table 4). 


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Pentagon Reservation Maintenance Revolving Fund 

(PRMRF). Section 1404 would transfer $77 million of unobligated 

balances from the PRMRF to the Treasury, to be deposited as miscellaneous receipts. This transfer would lower spending estimated 

to occur under current law because DoD would be unable to obligate and expend those amounts without a subsequent appropriation. 

The PRMRF finances the maintenance, repair, and renovation of 

the Pentagon and certain other facilities in the national capital 

area using appropriations originally provided to various operation 

and maintenance accounts (and later transferred into the fund). 

The unobligated balances in the fund have grown in recent years— 

from $35 million at the end of 2006 to $119 million at the end of 

2009. By the end of 2011, the administration expects those balances to total $120 million. As a result, CBO assumes a portion of 

those balances—roughly 20 percent, or $25 million—are excess to 

current requirements and will not be spent during the 2011–2020 

period under current law. As a result, CBO expects that section 

1404 would have no effect on outlays in 2011, but would lower 

spending by $52 million over the 2012–2020 period. 

Minimum Service for Retirement as an Officer. Officers who 

began their military career as enlisted servicemembers must complete at least 10 years of commissioned service in order to retire 

as an officer. Those with less than 10 years of commissioned service receive retirement annuities based on the highest enlisted grade 

the member achieved. Section 506 would give the service secretaries the authority to retire members as officers with a minimum 

of eight years of commissioned service. This authority would apply 

to fiscal years 2011 through 2013 only. 

Based on information from DoD, CBO estimates that about 200 

officers per year would be allowed to retire under this authority 

over the 2011–2013 period. Because those officers would retire earlier than they otherwise would have, section 506 would initially increase military retirement costs. Savings would accrue in later 

years because those retiring early would accumulate fewer years of 

service and would therefore accept smaller annuities. On net, CBO 

estimates that section 506 would increase costs for military retirement by $25 million over the 2011–2020 period. 

National Defense Stockpile Sales. Section 1412 would increase by $20 million the target contained in the National Defense 

Authorization Act for Fiscal Year 2000 (Public Law 106–65, as 

most recently amended by Public Law 110–181, the National Defense Authorization Act for Fiscal Year 2008) for continual sales of 

chromium from the National Defense Stockpile through 2013. That 

change would increase receipts by $20 million over the 2012–2013 

period. Such receipts are a credit against direct spending. 


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TABLE 4.—ESTIMATED IMPACT OF H.R. 5136 ON DIRECT SPENDING AND REVENUES 

By fiscal year, in millions of dollars— 

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2011–2015 2011–2020 

CHANGES IN DIRECT SPENDING 

Pentagon Reservation Maintenance Revolving Fund: 

Budget Authority ............................................................ ¥77 0 0 0 0 0 0 0 0 0 ¥77 ¥77 

Estimated Outlays ......................................................... 0 ¥8 ¥18 ¥16 ¥5 ¥3 ¥1 ¥1 0 0 ¥47 ¥52 

Minimum Service for Retirement as an Officer: 

Estimated Budget Authority .......................................... 4 11 13 8 * ¥2 ¥2 ¥2 ¥2 ¥3 36 25 

Estimated Outlays ......................................................... 4 11 13 8 * ¥2 ¥2 ¥2 ¥2 ¥3 36 25 

National Defense Stockpile Sales: 

Estimated Budget Authority .......................................... 0 ¥10 ¥10 0 0 0 0 0 0 0 ¥20 ¥20 

Estimated Outlays ......................................................... 0 ¥10 ¥10 0 0 0 0 0 0 0 ¥20 ¥20 

Reserve Early Retirement Credit for Medical Holdovers: 

Estimated Budget Authority .......................................... * 1 1 1 1 1 1 2 2 2 4 12 Estimated Outlays ......................................................... * 1 1 1 1 1 1 2 2 2 4 12 

Retired Pay for Reserve Members Wounded in Action: 

Estimated Budget Authority .......................................... * * 1 1 1 1 1 1 2 2 4 11 Estimated Outlays ......................................................... * * 1 1 1 1 1 1 2 2 4 11 

TRICARE for Early Reserve Retirees: 

Estimated Budget Authority .......................................... * * 1 1 1 1 1 1 2 2 3 10 Estimated Outlays ......................................................... * * 1 1 1 1 1 1 2 2 3 10 

Authority to Spend Landing Fees: 

Estimated Budget Authority .......................................... 1 1 1 1 1 1 1 1 1 1 5 10 Estimated Outlays ......................................................... 1 1 1 1 1 1 1 1 1 1 5 10 

Retirement Age of Certain Medical Professionals: 

Estimated Budget Authority .......................................... * * ¥1 ¥1 ¥1 ¥1 * * * * ¥3 ¥4 

Estimated Outlays ......................................................... * * ¥1 ¥1 ¥1 ¥1 * * * * ¥3 ¥4 

Special Survivor Allowance: 

Estimated Budget Authority .......................................... 1 * * * 1 1 1 0 0 0 2 4 Estimated Outlays ......................................................... 1 * * * 1 1 1 * 0 0 2 4 

Multiplier Cap for Disability Retirees With Over 30 Years of 

Service: 

Estimated Budget Authority .......................................... * * * * * * * * * * 1 2 Estimated Outlays ......................................................... * * * * * * * * * * 1 2 

Payment Date for Retired Pay: 

Estimated Budget Authority .......................................... 0 0 0 0 0 0 0 0 0 0 0 0 


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Estimated Outlays ......................................................... 3,967 ¥3,967 0 0 0 4,370 142 ¥4,512 0 0 0 0 Total Changes in Direct Spending: 

Estimated Budget Authority ................................. ¥71 3 7 12 4 2 3 3 5 5 ¥45 ¥27 

Estimated Outlays ................................................ 3,973 ¥3,972 ¥11 ¥4 ¥1 4,369 144 ¥4,510 5 5 ¥15 ¥2 

CHANGES IN REVENUES 

Multiplier Cap for Disability Retirees With Over 30 Years of 

Service: 

Estimated Revenues ...................................................... * * * * * * * * * * * ¥2 

NET INCREASE OR DECREASE (¥) IN THE DEFICIT 

FROM CHANGES IN DIRECT SPENDING AND REVENUES 

Estimated Deficit Impact 1 ..................................................... 3,973 ¥3,972 ¥11 ¥4 ¥1 4,369 144 ¥4,510 6 6 ¥15 0 

1 Negative numbers indicate a reduction in the deficit; positive numbers indicate the opposite. 

Notes: Numbers may not add up to totals because of rounding. 

* = between ¥$500,000 and $500,000. 


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Reserve Early Retirement Credit for Medical Holdovers. 

Under section 644, time spent by reserve component members in 

a medical holdover status would count towards earning an early— 

or earlier—retirement annuity. Reserve members with at least 20 

years of service are eligible to receive retirement annuities at age 

60. However, they may receive the annuities 90 days earlier for 

each 90 days they serve on active duty in a contingency operation. 

Based on an analysis of the number and ages of personnel currently in a holdover status, CBO estimates this section would increase direct spending for military retirement by $12 million over 

the 2011–2020 period. 

Retired Pay for Reserve Members Wounded in Action. Section 642 would allow reserve members who retire from the military 

because of wounds received in combat to have their retirement annuities calculated as though their years of service had all been 

spent on full-time active duty. (Under current law, such annuities 

are based on a combination of active and part-time reserve duty.) 

Based on data from DoD, CBO estimates that such a change would 

double the retirement annuities paid to qualifying individuals, from 

an average of about $7,000 per year to about $14,000 per year. 

Based on recent casualty statistics, CBO estimates that about 90 

new disability retirees would benefit each year from the change in 

the annuity calculation and that direct spending for military retirements would increase by about $11 million over the 2011–2020 period. 

TRICARE for Early Reserve Retirees. Section 643 would 

allow all former members who are receiving a retirement annuity 

for non-regular (reserve) service to become eligible for the 

TRICARE health benefit. Currently, those members do not become 

eligible for TRICARE until they are at least 60 years of age. Under 

the early reserve retirement provisions recently enacted in Public 

Law 110–181, CBO estimates that the number of former reserve 

members receiving an annuity before reaching age 60 will grow 

from about 1,000 in 2011 to more than 5,000 by 2020. Most of the 

funding associated with health care for those individuals would be 

subject to appropriation (see discussion in the ‘‘Spending Subject to 

Appropriation’’ section above). 

However, based on an analysis of the current military retiree 

population, CBO estimates that about four percent of those individuals would be eligible for Medicare. When military annuitants become eligible for Medicare, they also become eligible for the 

TRICARE-for-Life (TFL) health benefit, which acts as a Medicare 

supplement. Benefits under TFL are paid from the Medicare-Eligible Retiree Health Care Fund (MERHCF), a mandatory account. 

CBO estimates the average TFL benefit will be about $4,500 per 

beneficiary in 2011, and that it will grow to almost $8,000 by 2020. 

In total, CBO estimates section 643 would increase spending from 

the MERHCF by $10 million over the 2011–2020 period. 

Authority to Spend Landing Fees. Section 341 would allow 

the military departments to retain and spend fees collected from civilian aviators who utilize military airfields. Under temporary authority that expires after fiscal year 2010, DoD can use those fees 

to defray the costs of operating and maintaining the airfields where 

the fees are collected. Thereafter, any such amounts will be deposited in the Treasury as miscellaneous receipts, and will be unavailVerDate Mar 15 2010 13:03 May 27, 2010 Jkt 056634 PO 00000 Frm 00018 Fmt 6659 Sfmt 6602 E:\HR\OC\HR491P2.XXX HR491P2

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3The amount of the allowance was originally $50 per month in fiscal year 2009 and was then 

supposed to increase to $100 by 2014. It was scheduled to terminate five months into fiscal year 

2016. Section 201 of the Family Smoking Prevention and Tobacco Control Act (Public Law 111– 

131) subsequently increased the monthly amounts and extended the payments through 2017. 

able for obligation without a subsequent appropriation. Section 345 

would provide permanent authority to retain and spend those fees, 

leading to an increase in direct spending. Information from the Department of Defense indicates that those receipts total almost $1 

million dollars annually. Thus, section 345 would increase direct 

spending by $10 million over the 2011–2020 period, CBO estimates. 

Retirement Age of Certain Medical Professionals. Section 

501 would allow certain medical professionals (to be designated by 

the Secretary of Defense) to remain in an active status until age 

68. Currently, they must retire at age 62. CBO estimates that this 

change would decrease spending for military retirement because 

some members would begin receiving retirement annuities at a 

later date than they otherwise would have. Based on information 

from DoD, we estimate that, under section 501, about five officers 

each year would delay their retirements by an average of two years 

and would forgo about $80,000 in annuities for each of those years. 

The annual savings would decrease over time however, as those officers would receive larger annuities when they retire. In total, 

CBO estimates this section would reduce net direct spending for 

military retirements by $4 million over the 2011–2020 period. 

Special Survivor Allowance. Public Law 110–181 authorized a 

monthly allowance to be paid to those recipients of Survivor Benefit Plan (SBP) payments who have their annuities reduced dollarfor-dollar by the amount of Dependency and Indemnity Compensation (DIC) they receive from the Department of Veterans Affairs. 

The amount of that monthly allowance was $50 in 2009, and will 

increase each year until it reaches $310 per month in 2017, at 

which point the allowance is scheduled to terminate.3 However, 

survivors of retirees who died prior to the creation of the SBP benefit do not receive the allowance, even though their annuities are 

also offset by any DIC they might be receiving. Section 645 would 

eliminate this disparity. Based on data from DoD’s Office of the Actuary, CBO estimates that fewer than 500 additional survivors 

would receive the allowance under this section, which would increase direct spending for military retirement by $4 million over 

the 2011–2020 period. Costs in the first year would include back 

payments for fiscal years 2009 and 2010. 

Multiplier Cap for Disability Retirees With Over 30 Years 

of Service. Section 641 would increase the annuities of those 

members with over 30 years of service who elect a disability retirement. Currently, the annuity for disability retirees is capped at 75 

percent of the amount of their basic pay. Under this section, disability retirees would have their annuities increased by 2.5 percent 

for each year in which the member serves past 30 years. This 

would make the calculation for disability retirement consistent 

with the calculation of annuities for those who elect a non-disability retirement. 

Eliminating that cap would affect both direct spending and revenues. Direct spending would increase because those retirees with 

over 30 years of service who will elect to receive a disability retireVerDate Mar 15 2010 13:03 May 27, 2010 Jkt 056634 PO 00000 Frm 00019 Fmt 6659 Sfmt 6602 E:\HR\OC\HR491P2.XXX HR491P2

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4The federal fiscal years begins on October 1. 

ment under current law would see their annuities increased. Based 

on information from DoD, CBO estimates that each year about five 

new retirees would see their annuities increased by an average of 

$5,000. In total, CBO estimates this change would increase spending for military retirement by $2 million over the 2011–2020 period. 

In addition, because those portions of disability retired pay that 

are related to combat-related disabilities are non-taxable, CBO estimates that each year about 10 new retirees who would otherwise 

elect a non-disability retirement would now choose a disability retirement. CBO and JCT estimate that this would decrease federal 

revenues by $2 million over the 2011–2020 period. 

Payment Date for Retired Pay. Section 646 would change the 

payday for military retirement annuities from the first business 

day of each month to the first calendar day of each month. For 

most months this would have no effect, since the first business day 

usually falls on the first of the month. However, for months in 

which the first day falls on a weekend or holiday, DoD would instead make the payments on the last business day of the preceding 

month. Because the first day of fiscal years 2012, 2017, and 2018 

will fall on weekends, changing the payday to the first of the 

month would result in paydays shifting into fiscal years 2011, 

2016, and 2017.4 Each payday would cost about $4 billion, CBO estimates; thus, the provision would shift that amount to an earlier 

fiscal year in three of the next 10 years. However, we estimate that 

there would be no net impact over the 2011–2020 period. 

Other Provisions. The following provisions would have an insignificant effect on direct spending, primarily because they would 

affect few individuals or because they authorize both the collection 

and spending of funds so that the net budgetary impact would be 

small. 

• Section 353 would allow DoD to retain fees collected for transporting civilian passengers and cargo when such transportation is 

provided in response to an emergency, or in response to a request 

for humanitarian assistance. 

• Section 532 would give former enlisted members the ability to 

appeal separation decisions to certain disability review boards. This 

could result in a small number of disability separations being 

changed to disability retirements. 

• Section 576 would award the Medal of Honor to four former 

members of the Army. An award of the Medal of Honor includes 

a monthly stipend, unless the Medal is awarded posthumously. Because only one of the recipients is still living, CBO estimates this 

section would have an insignificant effect on direct spending. 

• Section 578 would allow the Secretary of Defense to accept voluntary services provided to assist with the Commemoration of the 

60th Anniversary of the Korean War. Because those volunteers 

would be eligible for mandatory compensation if they are injured 

while volunteering, CBO estimates that section 578 could have an 

insignificant effect on direct spending. 

• Section 606 would authorize higher rates of pay for the senior 

enlisted members at each of the combatant commands and would 


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require DoD to use those higher rates of pay when computing the 

annuities of those members. • Section 619 would make certain members of the Armed Forces 

or civilian employees of DoD who were killed or wounded eligible 

to receive additional compensation. CBO estimates that a small 

number of people would receive this compensation, including certain tax benefits and mandatory benefits, such as retroactive combat-related special pay and combat related special compensation. 

Any impacts on direct spending and revenues would be small, CBO 

estimates. • Section 701 would prohibit DoD from increasing the daily inpatient deductible under the TRICARE Standard health benefit. This 

prohibition would increase mandatory health care spending for certain TRICARE beneficiaries who live overseas, as well as for 

former members of the Coast Guard and other uniformed services. • Section 702 would require the Secretary of Defense to establish 

a new TRICARE benefit for dependents of current and former 

members who are under the age of 26. To offset the cost of the new 

benefit, the Secretary would be required to charge a premium for 

the new benefit and would be allowed to spend the proceeds without further appropriation. • Section 933 would extend by two years the authority to allow 

DoD to waive payment of reimbursable expenses at the various Defense Regional Centers for Security Studies by non-governmental 

and international organizations. Under current law, the waiver authority would expire after fiscal year 2010. DoD has the authority 

to retain and spend such reimbursements. 

Pay-as-you-go considerations: The Statutory Pay-As-You-Go Act 

of 2010 establishes budget reporting and enforcement procedures 

for legislation affecting direct spending or revenues. The net 

changes in outlays and revenues that are subject to those pay-asyou-go procedures are shown in the following table. 


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CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR H.R. 5136 AS REPORTED BY THE HOUSE COMMITTEE ON ARMED SERVICES ON MAY 21, 2010 

By fiscal year, in millions of dollars— 

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2010–2015 2010–2020 

NET INCREASE OR DECREASE (¥) IN THE DEFICIT 

Statutory Pay-As-You-Go Impact ....................... 0 3,973 ¥3,972 ¥11 ¥4 ¥1 4,369 144 ¥4,510 6 6 ¥15 0 


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Intergovernmental and private-sector impact: H.R. 5136 contains 

intergovernmental and private-sector mandates as defined in the 

Unfunded Mandates Reform Act. CBO estimates the costs of the 

intergovernmental mandates would not exceed the threshold established in UMRA ($70 million in 2010, adjusted annually for inflation). CBO cannot determine whether the costs to the private sector would exceed the annual threshold ($140 million in 2010, adjusted annually for inflation). 

Increasing the end strength of active duty forces 

Section 401 would increase the costs of complying with existing 

intergovernmental and private-sector mandates by increasing the 

number of servicemembers on active-duty by more than 7,000 for 

fiscal year 2011. Those additional servicemembers would be eligible 

for existing protections under the Servicemembers Civil Relief Act 

(SCRA). 

SCRA allows servicemembers to maintain a single state of residence for purposes of paying state and local personal income taxes 

and to request deferrals for certain state and local fees. CBO estimates that the additional cost of those mandates on state and local 

governments would be small. 

SCRA also requires creditors to reduce the interest rate on 

servicemembers’ loan obligations to 6 percent when the acquisition 

of such obligations predate active-duty service, allows courts to 

temporarily stay certain civil proceedings, such as evictions, foreclosures, and repossessions, and precludes the use of a 

servicemember’s personal assets to satisfy the member’s trade or 

business liability while he or she is in military service. 

CBO does not have sufficient information to estimate precisely 

the increased costs of complying with these provisions in SCRA. 

Servicemembers’ utilization of the various provisions of the SCRA 

depends on a number of uncertain factors, including how often and 

how long they are deployed. While some of the SCRA protections 

might affect a greater number of service members, the cost per person could be relatively small. On the other hand, other SCRA protections could have relatively high per-person costs even though 

they affect a small number of servicemembers. Because of those uncertainties, CBO cannot determine whether the costs to private-sector entities would exceed the annual threshold. 

Preemptions of state law 

Section 713 would authorize health care professionals who are 

members of the National Guard and who are serving in response 

to actual or potential disasters to practice in military and civilian 

health care facilities regardless of state licensing laws. That preemption of state laws would impose an intergovernmental mandate 

as defined in UMRA, but CBO estimates that the cost of complying 

with the mandate would be small. 

Section 544 would preempt state laws governing child custody if 

they are inconsistent with or provide less protection to the rights 

of a parent who is a servicemember than those provided under the 

bill. Because the preemption would simply limit the application of 

state laws, CBO estimates that it would not impose significant 

costs on state governments. 


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24 

Providing benefits to state and local governments 

The bill would authorize aid to local educational agencies that 

have significant numbers of students who are dependents of members of the Armed Forces and Department of Defense civilian employees. Any costs to those governments would be incurred voluntarily as conditions of receiving that federal assistance. 

Estimate prepared by: Federal costs: Defense Authorizations— 

Kent Christensen; Military Construction and Multiyear Procurement—David Newman; Military and Civilian Personnel—Dawn 

Regan; Military Retirement and Health Care—Matthew Schmit; 

Operation and Maintenance—Jason Wheelock; Ship Acquisition 

and Stockpile Sales—Raymond J. Hall; Euro-NATO Joint Jet Pilot 

Training Program—John Chin; Impact on state, local, and tribal 

governments: Burke Doherty; Impact on the private sector: Elizabeth Bass. 

Estimate approved by: Theresa Gullo, Deputy Assistant Director 

for Budget Analysis. 

Æ 


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