Senate panel hears testimony on bill to expand military pension income exclusion

Senator Buxton presented Senate Bill 219 to the Senate Executive Committee and asked members to first consider the bill’s merits: a phased increase of Delaware’s military pension exclusion from $12,500 toward $25,000 by 2029, with amendments clarifying spouse eligibility and residency rules for older retirees.

Supporters from military and veterans groups and two expert witnesses told the committee the change is necessary for Delaware to remain competitive with neighboring states and to retain experienced veterans who enter second careers here. Eugenia Thornton, identified as representing the Military Officers Association of America, said, "76% of the other states [and territories] do not tax any of the military retired income," and urged lawmakers to consider that competitive context.

William "Bill" Wessler III, introduced as a retired lieutenant general and president of the Air Mobility Command Museum Foundation, described retired enlisted pay levels and the practical pressures retirees face, saying, "Now you tell me anybody that can live on $2,500 to $3,000 a month," and arguing that many who retire from service then contribute to the state workforce in professions the state needs.

Sponsor Senator Buxton and witnesses addressed the fiscal note during the hearing. Buxton acknowledged the projected revenue impact cited in discussion (witnesses and sponsor referenced an estimated impact in the low millions) but framed it against a broader economic argument: the committee heard a figure cited by the sponsor that military retirees collectively generate nearly $300 million in income in Delaware and that retaining even a subset of those households supports local businesses and public services.

Multiple in-person public commenters urged the committee to advance the bill. Steve McGuire, vice chair and legislative chair of the Delaware Commission of Veterans Affairs, said the bill "is not just about dollars. It's about demonstrating that Delaware stands behind its veterans in a meaningful way." Kim Andress of the American Legion and representatives of veterans groups offered similar support, describing frequent relocations, early retirements from military careers and the need to keep trained personnel in the state.

The committee did not take a formal vote on SB 219 during the session. The hearing concluded after testimony and public comment; the committee adjourned without recording final action on the bill.