SECTION 1. EXEMPTION FROM PAYMENT OF INDIVIDUAL CONTRIBUTIONS UNDER 
              MONTGOMERY GI BILL OF INDIVIDUALS WHO SERVE AS ACTIVE 
              DUTY MEMBERS OF THE ARMED FORCES UNDER EXECUTIVE ORDER 
              13235.

    (a) Active Duty Program.--Notwithstanding section 3011(b) of title 
38, United States Code, no reduction in basic pay otherwise required by 
such section shall be made in the case of a covered member of the Armed 
Forces.
    (b) Selected Reserve Program.--Notwithstanding section 3012(c) of 
such title, no reduction in basic pay otherwise required by such 
section shall be made in the case of a covered member of the Armed 
Forces.
    (c) Termination of On-Going Reductions in Basic Pay.--In the case 
of a covered member of the Armed Forces who first became a member of 
the Armed Forces or first entered on active duty as a member of the 
Armed Forces before the date of the enactment of this Act and whose 
basic pay would, but for subsection (a) or (b) of this section, be 
subject to reduction under section 3011(b) or 3012(c) of such title for 
any month beginning on or after that date, the reduction of basic pay 
of such covered member of the Armed Forces under such section 3011(b) 
or 3012(c), as applicable, shall cease commencing with the first month 
beginning on or after that date.
    (d) Refund of Contributions.--(1) In the case of any covered member 
of the Armed Forces whose basic pay was reduced under section 3011(b) 
or 3012(c) of such title for any month beginning before the date of the 
enactment of this Act, the Secretary concerned shall pay to such 
covered member of the Armed Forces an amount equal to the aggregate 
amount of reductions of basic pay of such member of the Armed Forces 
under such section 3011(b) or 3012(c), as applicable, as of that date.
    (2) Any amount paid to a covered member of the Armed Forces under 
paragraph (1) shall not be included in gross income under the Internal 
Revenue Code of 1986.
    (3) Amounts for payments under paragraph (1) shall be derived from 
amounts appropriated or otherwise made available to the Secretary 
concerned for military personnel in chapter 1 of title I of the 
Emergency Supplemental Appropriations Act for Defense and for the 
Reconstruction of Iraq and Afghanistan, 2004 (Public Law 108-106; 117 
Stat. 1209).
    (4) In this subsection, the term ``Secretary concerned'' means--
            (A) the Secretary of the Army, with respect to matters 
        concerning the Army;
            (B) the Secretary of the Navy, with respect to matters 
        concerning the Navy or the Marine Corps;
            (C) the Secretary of the Air Force, with respect to matters 
        concerning the Air Force; and
            (D) the Secretary of Homeland Security, with respect to 
        matters concerning the Coast Guard.
    (e) Covered Member of the Armed Forces Defined.--In this section, 
the term ``covered member of the Armed Forces'' means any individual 
who serves on active duty as a member of the Armed Forces during the 
period--
            (1) beginning on November 16, 2001, the date of Executive 
        Order 13235, relating to National Emergency Construction 
        Authority; and
            (2) ending on the termination date of the Executive order 
        referred to in paragraph (1).

SEC. 2. OPPORTUNITY FOR INDIVIDUALS WHO SERVE AS ACTIVE DUTY MEMBERS OF 
              THE ARMED FORCES UNDER EXECUTIVE ORDER 13235 TO WITHDRAW 
              ELECTION NOT TO ENROLL IN MONTGOMERY GI BILL.

    Section 3018 of title 38, United States Code, is amended--
            (1) by redesignating subsections (c) and (d) as subsection 
        (d) and (e), respectively;
            (2) by inserting after subsection (b) the following new 
        subsection (c):
    ``(c)(1) Notwithstanding any other provision of this chapter, 
during the one-year period beginning on the date of the enactment of 
this subsection, an individual who--
            ``(A) serves on active duty as a member of the Armed Forces 
        during the period beginning on November 16, 2001, and ending on 
        the termination date of Executive Order 13235, relating to 
        National Emergency Construction Authority; and
            ``(B) has served continuously on active duty without a 
        break in service following the date the individual first 
        becomes a member or first enters on active duty as a member of 
        the Armed Forces,
shall have the opportunity, on such form as the Secretary of Defense 
shall prescribe, to withdraw an election under section 3011(c)(1) or 
3012(d)(1) of this title not to receive education assistance under this 
chapter.
    ``(2) An individual described paragraph (1) who made an election 
under section 3011(c)(1) or 3012(d)(1) of this title and who--
            ``(A) while serving on active duty during the one-year 
        period beginning on the date of the enactment of this 
        subsection makes a withdrawal of such election;
            ``(B) continues to serve the period of service which such 
        individual was obligated to serve;
            ``(C) serves the obligated period of service described in 
        subparagraph (B) or before completing such obligated period of 
        service is described by subsection (b)(3)(B); and
            ``(D) meets the requirements set forth in paragraphs (4) 
        and (5) of subsection (b),
is entitled to basic educational assistance under this chapter.''; and
            (3) in subsection (e), as so redesignated, by inserting 
        ``or (c)(2)(A)'' after ``(b)(1)''.
Output: Exempts from the mandatory payroll deductions ($100 for the first 12 months of active duty pay) under the veterans' basic educational assistance program, members of the Armed Forces and Selected Reserve on active duty between November 16, 2001, and the termination date of Executive Order 13235, who elect to receive basic educational assistance. Provides for reimbursement of payroll deductions taken prior to the enactment of this Act. Allows such members to withdraw an election not to receive basic educational assistance.