A bill to amend title 37, United States Code, to provide financial assistance to State and local governments that continue to pay employees who serve on active duty in a reserve component of the uniformed services.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Service to Country Reimbursement Act 
of 2003''.

SEC. 2. ASSISTANCE FOR STATE AND LOCAL GOVERNMENTS THAT CONTINUE TO PAY 
              EMPLOYEES WHO SERVE ON ACTIVE DUTY IN A RESERVE COMPONENT 
              OF THE UNIFORMED SERVICES.

    (a) In General.--Chapter 17 of title 37, United States Code, is 
amended by adding at the end the following new section:
``Sec. 910. Assistance for State and local governments that continue to 
              pay employees who serve on active duty
    ``(a) Continuation of Civilian Basic Pay.--It is the purpose of 
this section to encourage States and local governments to continue to 
pay a portion of the civilian compensation of those employees who are 
also members of a reserve component and are absent from a position of 
employment with the State or local government under a call or order to 
serve on active duty for a period of more than 30 days so that the 
employees receive compensation in an amount that, when taken together 
with their military pay, is at least equal to their civilian 
compensation.
    ``(b) Reimbursement Offered.--At the request of a State or local 
government that continues to pay all or a portion of the civilian 
compensation of an employee described in subsection (a), the Secretary 
concerned shall reimburse the State or local government for the 
civilian compensation paid by the State or local government for each 
pay period described in subsection (c), but not to exceed the 
difference (if any) between--
            ``(1) the amount of civilian compensation that would 
        otherwise have been payable to the employee for such pay period 
        if the employee's civilian employment with the State or local 
        government had not been interrupted by the service on active 
        duty; and
            ``(2) the amount of military pay that is payable to the 
        employee for the service on active duty and is allocable to 
        such pay period.
    ``(c) Pay Periods.--Reimbursement shall be provided under this 
section with respect to each pay period (which would otherwise apply if 
the employee's civilian employment had not been interrupted) that 
occurs--
            ``(1) while the employee serves on active duty for a period 
        of more than 30 days;
            ``(2) while the employee is hospitalized for, or 
        convalescing from, an illness or injury incurred in, or 
        aggravated during, the performance of such active duty; or
            ``(3) during the 14-day period beginning at the end of such 
        active duty or the end of the period referred to in paragraph 
        (2).
    ``(d) Effect of Failure To Return to Employment.--(1) If an 
employee described in subsection (a), with respect to whom 
reimbursement is provided to a State or local government under this 
section, fails to report or apply for employment or reemployment with 
the State or local government by the end of the period referred to in 
subsection (c)(3), the employee shall refund to the Secretary concerned 
the total amount of the reimbursement provided with respect to the 
employee.
    ``(2) Subject to paragraph (3), an obligation to refund moneys to 
the United States imposed under paragraph (1) is for all purposes a 
debt owed to the United States.
    ``(3)(A) The Secretary concerned may waive, in whole or in part, a 
refund required under paragraph (1) if the Secretary concerned 
determines that recovery would be against equity and good conscience or 
would be contrary to the best interests of the United States.
    ``(B) The Secretary concerned shall waive a refund required under 
paragraph (1) if the Secretary concerned determines that the failure of 
the employee in question to report or apply for employment or 
reemployment was due to an injury or disability of the employee that is 
not the fault of the employee.
    ``(4) A discharge in bankruptcy under title 11 that is entered less 
than five years after the end of the period referred to in subsection 
(c)(3) does not discharge the employee from a debt arising under 
paragraph (1). This paragraph applies to any case commenced under title 
11 after the date of the enactment of this section.
    ``(e) Regulations.--The Secretaries concerned shall prescribe 
regulations to carry out this section.
    ``(f) Definitions.--In this section:
            ``(1) The term `civilian compensation' means the wages or 
        salary that an employee of a State or local government normally 
        receives from the employee's employment by the State or local 
        government.
            ``(2) The term `local government' means an agency or 
        political subdivision of a State.
            ``(3) The term `military pay' has the meaning given the 
        term `pay' in section 101(21) of this title.
            ``(4) The term `State' means each of the several States of 
        the United States, the District of Columbia, the Commonwealth 
        of Puerto Rico, Guam, the Virgin Islands, and other territories 
        or possessions of the United States.''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
chapter 17 of title 37, United States Code, is amended by inserting 
after the item relating to section 909 the following new item:

``910. Assistance for State and local governments that continue to pay 
                            employees who serve on active duty.''.
    (c) Application of Amendment.--Section 910 of title 37, United 
States Code, as added by subsection (a), shall apply with respect to 
pay periods (as described in subsection (b) of such section) beginning 
on or after the date of the enactment of this Act.

Summary: Service to Country Reimbursement Act of 2003 - Requires the Secretary of the military department concerned (Secretary), at the request of a State or local government that continues to pay all or a portion of the civilian compensation of an employee while that employee is absent due to a call or order to serve on active military duty for a period of more than 30 days, to reimburse the State or local government up to an amount not to exceed the difference between: (1) the amount of civilian compensation that would otherwise have been payable to the employee if the employee's civilian compensation had not been interrupted by active-duty service; and (2) the amount of military pay that is payable to such employee for the active duty service performed. Requires an employee who fails to return to such civilian employment to refund to the Secretary the total amount of reimbursement provided with respect to that employee, but allows the Secretary to waive such refund requirement if such recovery would be against equity and good conscience or contrary to the best interests of the United States. Requires the Secretary to waive such refund if the failure of the employee to report or apply was due to an injury or disability that is not the fault of the employee.