H. R. 5122—176
(d) PAYMENT
OF BONUS.—Subsection (e) of such section is 
amended to read as follows: 
‘‘(e) PAYMENT.—A bonus payable for a referral of a person 
under subsection (a) shall be paid as follows: 
‘‘(1) Not more than $1,000 shall be paid upon the 
commencement of basic training by the person referred. 
‘‘(2) Not more than $1,000 shall be paid upon the completion 
of basic training and individual advanced training by the person 
referred.’’. 
(e) COORDINATION WITH RECEIPT OF RETIRED PAY.—Such sec-
tion is further amended—
(1) by redesignating subsection (g) as subsection (h); and 
(2) by inserting after subsection (f) the following new sub-
section (g): 
‘‘(g) COORDINATION WITH RECEIPT OF RETIRED PAY.—A bonus 
paid under this section to a member of the Army in a retired 
status is in addition to any compensation to which the member 
is entitled under title 10, 37, or 38, United States Code, or any 
other provision of law.’’. 
(f) EFFECTIVE DATE.—The amendments made by this section 
shall take effect on the date of the enactment of this Act, and 
shall apply with respect to bonuses payable under section 645 
of the National Defense Authorization Act for Fiscal Year 2006, 
as amended by this section, on or after that date. 
Subtitle C—Travel and Transportation 
Allowances 
SEC. 
631. 
TRAVEL 
AND 
TRANSPORTATION 
ALLOWANCES 
FOR 
TRANSPORTATION OF FAMILY MEMBERS INCIDENT TO ILL-
NESS OR INJURY OF MEMBERS. 
Section 411h(b)(1) of title 37, United States Code, is amended—
(1) by striking ‘‘and’’ at the end of subparagraph (C); 
(2) by striking the period at the end of subparagraph (D) 
and inserting ‘‘; and’’; and 
(3) by adding at the end the following new subparagraph: 
‘‘(E) a person related to the member as described in 
subparagraph (A), (B), (C), or (D) who is also a member of 
the uniformed services.’’. 
Subtitle D—Retired Pay and Survivor 
Benefits 
SEC. 641. RETIRED PAY OF GENERAL AND FLAG OFFICERS TO BE 
BASED ON RATES OF BASIC PAY PROVIDED BY LAW. 
(a) DETERMINATION OF RETIRED PAY BASE.—Chapter 71 of title 
10, United States Code, is amended by inserting after section 1407 
the following new section: 
‘‘§ 1407a. Retired pay base: officers retired in general or flag 
officer grades 
‘‘(a) RATES OF BASIC PAY TO BE USED IN DETERMINATION.—
In a case in which the determination under section 1406 or 1407 
of this title of the retired pay base applicable to the computation
H. R. 5122—177
of the retired pay of a covered general or flag officer involves 
a rate of basic pay payable to that officer for any period that 
was subject to a reduction under section 203(a)(2) of title 37 for 
such period, such retired-pay-base determination shall be made 
using the rate of basic pay for such period provided by law, rather 
than such rate as so reduced. 
‘‘(b) COVERED GENERAL AND FLAG OFFICERS.—In this section, 
the term ‘covered general or flag officer’ means a member or former 
member who after September 30, 2006, is retired in a general 
officer grade or flag officer grade.’’. 
(b) CLERICAL AMENDMENT.—The table of sections at the begin-
ning of such chapter is amended by inserting after the item relating 
to section 1407 the following new item:
‘‘1407a. Retired pay base: officers retired in general or flag officer grades.’’.
SEC. 642. INAPPLICABILITY OF RETIRED PAY MULTIPLIER MAXIMUM 
PERCENTAGE TO CERTAIN SERVICE OF MEMBERS OF THE 
ARMED FORCES IN EXCESS OF 30 YEARS. 
(a) IN GENERAL.—Paragraph (3) of section 1409(b) of title 10, 
United States Code, is amended to read as follows: 
‘‘(3) 30 YEARS OF SERVICE.—
‘‘(A) RETIREMENT BEFORE JANUARY 1, 2007.—In the case 
of a member who retires before January 1, 2007, with 
more than 30 years of creditable service, the percentage 
to be used under subsection (a) is 75 percent. 
‘‘(B) RETIREMENT
AFTER
DECEMBER
31, 2006.—In the 
case of a member who retires after December 31, 2006, 
with more than 30 years of creditable service, the percent-
age to be used under subsection (a) is the sum of—
‘‘(i) 75 percent; and 
‘‘(ii) the product (stated as a percentage) of—
‘‘(I) 21⁄2; and 
‘‘(II) the member’s years of creditable service 
(as defined in subsection (c)) in excess of 30 years 
of creditable service, under conditions authorized 
for purposes of this subparagraph during a period 
designated by the Secretary of Defense for pur-
poses of this subparagraph.’’. 
(b) RETIRED PAY FOR NON-REGULAR SERVICE.—Section 12739(c) 
of such title is amended—
(1) by striking ‘‘The total amount’’ and inserting ‘‘(1) Except 
as provided in paragraph (2), the total amount’’; and 
(2) by adding at the end the following new paragraph: 
‘‘(2) In the case of a person who retires after December 
31, 2006, with more than 30 years of service credited to that 
person under section 12733 of this title, the total amount of 
the monthly retired pay computed under subsections (a) and 
(b) may not exceed the sum of—
‘‘(A) 75 percent of the retired pay base upon which 
the computation is based; and 
‘‘(B) the product of—
‘‘(i) the retired pay base upon which the computa-
tion is based; and 
‘‘(ii) 21⁄2 percent of the years of service credited 
to that person under section 12733 of this title, for 
service under conditions authorized for purposes of
H. R. 5122—178
this paragraph during a period designated by the Sec-
retary of Defense for purposes of this paragraph.’’. 
SEC. 643. MILITARY SURVIVOR BENEFIT PLAN BENEFICIARIES UNDER 
INSURABLE INTEREST COVERAGE. 
(a) AUTHORITY TO ELECT NEW BENEFICIARY.—Section 1448(b)(1) 
of title 10, United States Code, is amended—
(1) by inserting ‘‘or under subparagraph (G) of this para-
graph’’ in the second sentence of subparagraph (E) before the 
period at the end; and 
(2) by adding at the end the following new subparagraph: 
‘‘(G) ELECTION OF NEW BENEFICIARY UPON DEATH OF 
PREVIOUS BENEFICIARY.—
‘‘(i) AUTHORITY FOR ELECTION.—If the reason for 
discontinuation in the Plan is the death of the bene-
ficiary, the participant in the Plan may elect a new 
beneficiary. Any such beneficiary must be a natural 
person with an insurable interest in the participant. 
Such an election may be made only during the 180-
day period beginning on the date of the death of the 
previous beneficiary. 
‘‘(ii) PROCEDURES.—Such an election shall be in 
writing, signed by the participant, and made in such 
form and manner as the Secretary concerned may pre-
scribe. Such an election shall be effective the first 
day of the first month following the month in which 
the election is received by the Secretary. 
‘‘(iii) VITIATION OF ELECTION BY PARTICIPANT WHO 
DIES
WITHIN
TWO
YEARS
OF
ELECTION.—If a person 
providing an annuity under a election under clause 
(i) dies before the end of the two-year period beginning 
on the effective date of the election—
‘‘(I) the election is vitiated; and 
‘‘(II) the amount by which the person’s retired 
pay was reduced under section 1452 of this title 
that is attributable to the election shall be paid 
in a lump sum to the person who would have 
been the deceased person’s beneficiary under the 
vitiated election if the deceased person had died 
after the end of such two-year period.’’. 
(b) CHANGE IN PREMIUM FOR COVERAGE OF NEW BENEFICIARY.—
Section 1452(c) of such title is amended by adding at the end 
the following new paragraph: 
‘‘(5) RULE FOR DESIGNATION OF NEW INSURABLE INTEREST 
BENEFICIARY
FOLLOWING
DEATH
OF
ORIGINAL
BENEFICIARY.—
The Secretary of Defense shall prescribe in regulations pre-
miums which a participant making an election under section 
1448(b)(1)(G) of this title shall be required to pay for partici-
pating in the Plan pursuant to that election. The total amount 
of the premiums to be paid by a participant under the regula-
tions shall be equal to the sum of the following: 
‘‘(A) The total additional amount by which the retired 
pay of the participant would have been reduced before 
the effective date of the election if the original beneficiary 
(i) had not died and had been covered under the Plan 
through the date of the election, and (ii) had been the
H. R. 5122—179
same number of years younger than the participant (if 
any) as the new beneficiary designated under the election. 
‘‘(B) Interest on the amounts by which the retired 
pay of the participant would have been so reduced, com-
puted from the dates on which the retired pay would have 
been so reduced at such rate or rates and according to 
such methodology as the Secretary of Defense determines 
reasonable. 
‘‘(C) Any additional amount that the Secretary deter-
mines necessary to protect the actuarial soundness of the 
Department of Defense Military Retirement Fund against 
any increased risk for the fund that is associated with 
the election.’’. 
(c) TRANSITION.—
(1) TRANSITION PERIOD.—In the case of a participant in 
the Survivor Benefit Plan who made a covered insurable-
interest election (as defined in paragraph (2)) and whose des-
ignated beneficiary under that election dies before the date 
of the enactment of this Act or during the 18-month period 
beginning on such date, the time period applicable for purposes 
of the limitation in the third sentence of subparagraph (G)(i) 
of section 1448(b)(1) of title 10, United States Code, as added 
by subsection (a), shall be the two-year period beginning on 
the date of the enactment of this Act (rather than the 180-
day period specified in that sentence). 
(2) COVERED
INSURABLE-INTEREST
ELECTIONS.—For pur-
poses of paragraph (1), a covered insurable-interest election 
is an election under section 1448(b)(1) of title 10, United States 
Code, made before the date of the enactment of this Act, or 
during the 18-month period beginning on such date, by a 
participant in the Survivor Benefit Plan to provide an annuity 
under that plan to a natural person with an insurable interest 
in that person. 
(3) SURVIVOR BENEFIT PLAN.—For purposes of this sub-
section, the term ‘‘Survivor Benefit Plan’’ means the program 
under subchapter II of chapter 73 of title 10, United States 
Code. 
SEC. 644. MODIFICATION OF ELIGIBILITY FOR COMMENCEMENT OF 
AUTHORITY FOR OPTIONAL ANNUITIES FOR DEPENDENTS 
UNDER THE SURVIVOR BENEFIT PLAN. 
(a) IN GENERAL.—Section 1448(d)(2)(B) of title 10, United States 
Code, is amended by striking ‘‘who dies after November 23, 2003’’ 
and inserting ‘‘who dies after October 7, 2001’’. 
(b) APPLICABILITY.—Any annuity payable to a dependent child 
under subchapter II of chapter 73 of title 10, United States Code, 
by reason of the amendment made by subsection (a) shall be payable 
only for months beginning on or after the date of the enactment 
of this Act. 
SEC. 645. STUDY OF TRAINING COSTS, MANNING, OPERATIONS TEMPO, 
AND OTHER FACTORS THAT AFFECT RETENTION OF MEM-
BERS OF THE ARMED FORCES WITH SPECIAL OPERATIONS 
DESIGNATIONS. 
(a) REPORT REQUIRED.—Not later than August 1, 2007, the 
Secretary of Defense shall submit to the Committee on Armed 
Services of the Senate and the Committee on Armed Services of