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U.S. National Debt:

Working To Eliminate The Veterinarian Shortage

Guest column submitted by U.S. Senator Mike Crapo

Food animal veterinarians are part of the first line of defense in ensuring food safety and public health, improving animal health and welfare and safeguarding our homeland from foreign animal disease.  Unfortunately, many agricultural communities across our nation that need veterinarians the most have experienced a shortage in essential veterinarian services in recent years.  That is why I recently introduced the Veterinary Medicine Loan Repayment Program Enhancement Act that would address the shortage by helping to increase the placement of more veterinarians in areas of the country where they are desperately needed.

In 2003, to help get more veterinarians in communities that need them, Congress established the Veterinary Medicine Loan Repayment Program (VMLRP) that assists selected food animal and public health veterinarians with student loan repayment for a three-year commitment to practice in areas of the country facing a veterinarian shortage.  This program helps veterinarians with daunting student loan debt with making a living in a community where starting a practice may be otherwise financially impossible.  Through the program, more than 280 veterinarians have been placed in communities throughout the country-a benefit for food safety, the communities, farmers and ranchers, the veterinarians and more.  

The problem is the VMLRP is a victim of our complex, overly-burdensome tax code.  The program is subject to a significant federal withholding tax on the assistance provided to qualifying veterinarians.  The U.S. Department of Agriculture (USDA) administers the VMLRP and pays the withholding tax on behalf of participating veterinarians out of available program funding.  This affects the amount of limited resources that can go toward this worthy effort and the reach of its benefits.  The legislation I introduced will address this by providing an exemption from the federal income withholding tax for payments received under the VMLRP and similar state programs.  Thus, more veterinarians would have the opportunity to practice in small, rural communities where their services are greatly needed, and more communities will have much-needed veterinarian services.

To illustrate the need for the legislation, please consider the following example.  In October 2014, the USDA's National Institute of Food and Agriculture announced that 51 veterinarians received awards through the VMLRP for placement in communities in need.  The awards announced in October will fill shortage needs in 22 states.  However, estimates show that if this withholding tax were to be eliminated, an additional veterinarian could be placed in a shortage area for every three currently participating in the program.  That means approximately 17 additional awards could have been issued last year had this tax been eliminated.  

This legislation would also help bring the tax treatment of this program in line with the tax treatment of assistance for doctors and nurses who are serving areas of the country in need through the National Health Service Corps' loan repayment program.  In 2004, Congress exempted the benefits available under the National Health Service Corps' loan repayment program from the federal withholding tax.  Enactment of the Veterinary Medicine Loan Repayment Enhancement Act would create tax parity for the counterpart program for veterinary medicine. 

So far, 15 Senators, including fellow Idaho Senator Jim Risch (R-Idaho), from both sides of the aisle have co-sponsored this important legislation and more than 150 national and local organizations support the bill and are urging its passage.  As I continue to press for comprehensive reform of our tax code, I will encourage the elimination of burdensome tax provisions to help ensure that rural agricultural communities have access to needed veterinary care. 

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