Patriotic Employers of Guard and Reservists Act of 2004

PATRIOTIC EMPLOYERS OF GUARD AND RESERVISTS ACT OF 2004 -- (House of Representatives - June 24, 2004)

(Mr. McGOVERN asked and was given permission to address the House for 1 minute and to revise and extend his remarks and include therein extraneous material.)

Mr. McGOVERN. Mr. Speaker, currently over 170,000 National Guard and Reservists are on active duty serving in Afghanistan, Iraq, and elsewhere. President Bush just activated an additional 47,000 Reservists. Most are serving extended tours of duty, deployed for longer periods than their families or their employers expected. Seventy percent of these Guard and Reservists work in small or medium-size businesses. When called to active duty, their civilian job and salary is put on hold.

They begin receiving military pay, which is often less than their civilian salary, placing undue hardship on families already suffering the absence of a loved one.

Yesterday, I introduced H.R. 4655, the Patriotic Employers of Guard and Reservists Act. The bill provides tax relief to those employers who close the pay gap of Guardsmen and Reservists serving overseas and tax credits to defray the cost of training new workers to fill these temporary vacancies.

H.R. 4655 helps our troops and their families and encourages more companies to keep their employees on payroll when serving our Nation. I urge my colleagues to support H.R. 4655. And I urge that it move rapidly through this House.

Basic Facts and Background Information on H.R. 4655, the Patriotic Employers of Guard and Reservists Act of 2004

Since September 11th, more than 350,000 members of the National Guard and Reserves have been called to active duty, and the Pentagon increasingly relies on the Army, Navy and Air Force Reserves and our National Guard to achieve its missions. Currently, over 170,000 are serving on active duty in Iraq, Afghanistan and elsewhere. President Bush recently activated an additional 47,000 Reservists. Not since World War II have so many National Guard members been called to serve abroad.

The U.S. Chamber Of Commerce estimates that 70 percent of military Reservists called to active duty work in small- or medium-size companies.

Most Guard and Reservists are serving extended tours of duty and have been deployed for longer periods than they, their families, or their employers expected. The continuing, extended activation of Guard and Reserve members has imposed a tremendous burden on many companies, small businesses and manufacturers, as well as placing an undue financial burden on families already suffering the absence of a loved one. Currently, more than 41 percent of military Reservists and National Guard members face a pay cut when they are called to active duty.

In January, the Commander of the Army Reserve, Lt. General James R. Helmly, warned of a recruiting-retention crisis in the future for the National Guard and Reserves. A recent U.S. military questionnaire of returning Army National Guard soldiers projected a resignation rate of double what it was in November 2001. From October to December 2003, almost one-quarter of National Guard members who have had the opportunity to re-enlist have opted not to do so. Recently, the U.S. Army developed a plan to pay Reservists up to $10,000 to re-enlist in order to stop a developing problem.

H.R. 4655 encourages all employers, especially small businesses, to pay their reservist employees when they face a reduction in salary due to their military activation. Employers who continue to pay their reservist all or part of their civilian salary will be eligible to receive a tax credit up to $15,000 of the wages they pay per employee who has been called up to active duty by the National Guard or Reserves for as long as the Reservist is on active duty status (up to a maximum of two years).

Additionally, many small employers currently have a difficult time hiring and training temporary workers to fill the temporary vacancies caused by employees called to active duty. H.R. 4655 provides a tax credit of 50 percent up to $6,000 to help companies defray the costs of hiring and training a replacement worker, and up to $10,000 for small manufacturers.

The Joint Committee on Taxation estimates this measure would cost $2 billion through FY 2014, or approximately $200 million annually; $1.2 billion of those costs would occur in FY 2005 through FY 2009, given the current unusually large-scale and extended deployments of National Guard and Reserve forces.

The proposal to provide tax credits to employers and close the pay-gap for Reservists and National Guardsmen is supported by the United States Conference of Mayors, the National Guard Association of the United States, and the Reserve Officers Association of the United States.

Cosponsor H.R. 4655, the Patriotic Employers of Guard and Reservists Act

DEAR COLLEAGUE.

When a national Guardsman or Reservist is called up to active duty, their civilian job-and salary-is put on hold, and they begin receiving military pay, which is often much less than their civilian salary. This places undue hardship on many families who are already suffering the absence of a loved one. The military increasingly relies on our Reserves and National Guard forces to achieve its missions. Currently, over 170,000 National Guard and Reservists are on active duty, with many serving in Iraq, Afghanistan or elsewhere on the front lines of the war against terror. Furthermore, most are serving extended tours of duty, deployed for longer periods than they, their families, or their employers expected.

We invite you to join us as cosponsors to H.R. 4655, the Patriotic Employers of Guard and Reservists Act of 2004. This bill provides tax credits to those employers who continue to pay the salary of National Guardsmen and Reservists serving overseas and tax credits to help these employers defray the costs of hiring and training new workers to fill these temporary vacancies. H.R. 4655 will do a lot to help our troops' families and encourage more companies to keep their employees on salary while serving our nation.

Specifically, H.R. 4655 will:

Provide a 50% tax credit to employers continuing to pay activated Guard and Reserve employees, with a cap of $30,000 (i.e. $15,000 credit) per employee;

Cover salaries paid on days when the employee is activated for up to 2 years to cover the entirety of the deployment; and

Provide a 50% tax credit to employers up to $12,000 in costs (i.e. $6,000 tax credit) to help companies, especially small businesses and manufacturers, hire and train temporary workers to fill-in for activated employees.

We all know the continuing activation of our Guard and Reservists has imposed a tremendous burden on many of our country's companies, small businesses, and manufacturers. The U.S. Chamber of Congress estimates that 70 percent of military reservists called to active duty work in small- or medium-sized businesses. The proposal to provide tax credits to employers and close the pay-gap for Reservists and National Guard is supported by the U.S. Conference of Mayors, the National Guard Association of the United States (NGAUS), and the Reserve Officers Association of the United States.

Please join us in helping businesses weather the loss of an employee to active duty and protecting employees and their families from suffering financial hardship when serving our nation in uniform. to cosponsor H.R. 4655, please feel free to contact us or Cindy Buhl at 5-6101 (cindy.buhl@mail.house.gov).

Sincerely,

James P. McGovern,
Member of Congress.

Tom Lantos,
Member of Congress.

END