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New Law Improves Montgomery GI Bill

By Staff Sgt. Kathleen T. Rhem, USA
American Force Press Service

WASHINGTON, Dec. 21, 2000 -- The Veterans Benefits and Health Care Improvement Act of 2000, signed by President Clinton Nov. 1, makes several important improvements to the Montgomery GI Bill.

Monthly payments climbed by nearly $100 starting Nov. 1, 2000. The rate for full-time training increased from $552 a month to $650 for eligible veterans with at least a three- year term of service. The rate for those with a two-year term of service went from $449 a month to $528.

The law also provided for an increase from $485 a month to $588 for eligible spouses and children under the Dependents Education Act. This program is for families of veterans who are permanently and totally disabled through their service, or who died while on active duty or shortly after leaving the service,” said Dennis Douglass, VA deputy director of education services.

“These families are our most at-risk population, because the traditional breadwinner has been taken out of the picture," he said. "This program is VA’s opportunity to reward the families of service members who have paid an incredible price.”

Another provision in the law addresses service members who leave active duty before the end of their first term and return later. Previously, these people were precluded from drawing the GI Bill benefit because the program only recognized the initial term of service. The new legislation allows VA to consider any term of service when deciding eligibility, Douglass explained.

“We’re not talking about somebody who spent … six or eight months in the service and never came back,” Douglass said. “We’re really talking about somebody who committed to the military and this nation. As equity would dictate, these people really are deserving of the benefit.”

Service members can now increase their contributions and receive increased benefits later. Members participating in the MGIB contribute $1,200 at the rate of $100 each month in the first year of service. The newly allowed additions can be made in $4 increments up to a total maximum of $600.

VA's basic full-time education benefit of $23,400 is paid in 36 monthly installments of $650 and represents a 19.5- to-1 return on a member's $1,200 investment. Douglass said additional contributions would return 9-to-1. A $600 maximum addition, then, would raise a member's total benefit to $28,800 -- 36 payments of $800 a month.

Douglass said the law also makes a long-awaited change to the old Veterans Educational Assistance Program, which was available to service members between 1977 and 1985. A 1996 law allowed anybody with money in their VEAP accounts to convert to the more generous Montgomery GI Bill. Many service members had no money in their VEAP accounts because they had previously been allowed to withdraw it, he said.

“As long as individuals were contributors to VEAP at any time in their military service, the new legislation allows them to convert to the GI Bill if they were on active duty on Oct. 9, 1996, the date the previous law was enacted, and if they stayed on active duty continuously through Apr. 1, 2000,” Douglass said.

To become eligible for Montgomery GI Bill benefits, however, VEAP-era veterans must contribute $2,700. Douglass explained $2,700 was the maximum VEAP contribution.

Additional changes include:

o The cost of licensing and certification tests is covered. They previously were not.

o The cost of preparation courses for college and graduate school entrance exams for eligible Dependents Education Assistance Program participants is covered.

o The maximum break in training allowed before a break in benefits occurs increased from one calendar month to eight weeks. “This basically allows students to go out and find a job for a short period between class terms,” Douglass said.

For more information on veterans educational benefits, visit the Department of Veterans Affairs’ Internet home page at www.va.gov.

Information Courtesy of American Forces Information Service

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