President Bush signed into law the bill designating the Soldiers’
and Sailors’ Civil Relief Act as the new Servicemembers’
Civil Relief Act. See “A
Judge’s Guide to the Soldiers’ and Sailors’
Civil Relief Act.” The following is a fact sheet
developed by the Judge Advocate General of the Army on the
new SCRA. The entire bill is HR
100.
SUBJECT: Revision to the Soldiers’ and Sailors’
Civil Relief Act
1. Purpose. To provide information about the new Servicemembers
Civil Relief Act.
2. Facts.
a. On 19 December 2003, President Bush signed into law
the “Servicemembers Civil Relief Act” (SCRA).
This law is a complete revision of the Soldiers’ and
Sailors’ Civil Relief Act (SSCRA).
b. The SSCRA provided a number of significant protections
to servicemembers. These include: staying court hearings
if military service materially affects servicemembers’
ability to defend their interests; reducing interest to
6% on pre-service loans and obligations; requiring court
action before a servicemember’s family can be evicted
from rental property for nonpayment of rent if the monthly
rent is $1,200 or less; termination of a pre-service residential
lease; and allowing servicemembers to maintain their state
of residence for tax purposes despite military relocations
to other states.
c. The SSCRA was largely unchanged from its enactment
in 1940. The SCRA was written to: clarify the language of
the SSCRA: to incorporate many years of judicial interpretation
of the SSCRA; and to update the SSCRA to reflect new developments
in American life since 1940. The SCRA:
(1) Extends the application of a servicemember’s
right to stay court hearings to administrative hearings.
It now requires a court or administrative hearing to grant
at least a 90-day stay if requested by the servicemember.
Additional stays can be granted at the discretion of the
judge or hearing official. The court must appoint counsel
to represent the servicemember if the court denies the
request for an additional stay.
(2) Clarifies the rules on the 6% interest rate cap
on pre-service loans and obligations by specifying that
interest in excess of 6% per year must be forgiven. The
absence of such language in the SSCRA had allowed some
lenders to argue that interest in excess of 6% is merely
deferred. It also specifies that a servicemember must
request this reduction in writing and include a copy of
his/her orders.
(3) Modifies the eviction protection section by precluding
evictions from premises occupied by servicemembers for
which the monthly rent does not exceed $2,400 for the
year 2003 (an increase from the current $1,200). The Act
provides a formula to calculate the rent ceiling for subsequent
years.
(4) Extends the right to terminate real property leases
to active duty soldiers moving pursuant to permanent change
of station (PCS) orders or deployment orders of at least
90 days. This eliminates the need to request a military
termination clause in leases.
(5) Adds a new provision allowing the termination of
automobile leases for use by servicemembers and their
dependents. Pre-service automobile leases may be cancelled
if the servicemember receives orders to active duty for
a period of 180 days or more. Automobile leases entered
into while the servicemember is on active duty may be
terminated if the servicemember receives PCS orders to
a location outside the continental United States or deployment
orders for a period of 180 days or more.
(6) Adds a provision that would prevent states from
increasing the tax bracket of a nonmilitary spouse who
earned income in the state by adding in the service member’s
military income for the limited purpose of determining
the nonmilitary spouse’s tax bracket. This practice
has had the effect of increasing the military family’s
tax burden.
(7) Adds legal services as a professional service specifically
named under the provision that provides for suspension
and subsequent reinstatement of existing professional
liability insurance coverage for designated professionals
serving on active duty. While the SSCRA specifically names
only health care services, legal services have been covered
since 3 May 1999 by Secretary of Defense designations.
The SSCRA permitted such a Secretarial designation, but
this revision will clarify this area.
d. Historically, the SSCRA applied to members of the National
Guard only if they were serving in a Title 10 status. Effective
6 December 2002, the SSCRA protections were extended to
members of the National Guard called to active duty for
30 days or more pursuant to a contingency mission specified
by the President or the Secretary of Defense. This continues
in the SCRA.
