On Nov. 10 — the day before Veterans Day — Mayor Bloomberg announced a measure that will save police officers and other city employees who were called up for military service since Sept. 11, 2001, thousands of dollars in reimbursement payments under the Extended Military Benefits Package.

The five-year-old policy provided that police officers and others in military service continued to receive their city salary but were required to repay the lesser of their military or their city pay upon their return.

The PBA, other union advocates and City Council members criticized the city for, among other things, wanting to include food and housing allowances in the military compensation calculations, and these critics lobbied strenuously for a policy change. Finally, the city saw the error of its ways.

“Living in a tent and eating K-rations in the desert while you’re worried about somebody coming along and killing you isn’t exactly income,” Mayor Bloomberg remarked on his Nov. 9 weekly radio broadcast. We couldn’t have said it better ourselves. But we would have said it sooner.

Almost 1,500 reservists — 85 percent of them police officers, firefighters, correction officers or sanitation workers — are affected by the decision.

According to the city’s estimate, they will have to repay an average of 40% less than what they would have under the old formula. The new arrangement is retroactive — those who have already made full payment will be receiving reimbursement.

Of course, most of the confusion and hardship surrounding the issue was the city’s doing in the first place. The city didn’t centralize its collection process, leaving that responsibility to the individual agency. As a result, in many instances at the NYPD, the letters seeking repayment were not issued until three or four years after the military service. Doesn’t that mean the city contributed to the problem by not seeking timely reimbursement? After all, if a person signs a contract to pay an employer back in 30 days, and the employer doesn’t try to collect until three or four years later, shouldn’t that person have concluded that the debt had been forgiven — especially when one had been fighting for one’s country?

PBA President Pat Lynch called the city’s announcement that its reservists would not be charged for food and lodging “a major step in the right direction in recognizing the extraordinary sacrifices these men and women have made for their city and their country.”

That “major step” means a lot to reservist-cops like Michael Kelly, a recently retired police officer who served in the Naval Reserve in 2001-2003. He told the New York Times that the decision saved him $10,000. And Michael Zak, activated by the Marine Corps, told the newspaper that it would mean his family could keep about $15,000 of the $35,000 it supposedly owed the city. 

“I think the city stepped up and did the right thing,” he said. But as Pat Lynch said in his initial reaction to the city’s announcement, “The PBA will be even more satisfied when the city solves a remaining issue by finding a way to ensure that our members will not suffer any undue tax and FICA losses and liabilities under the arrangement.” While the city has offered free advice by two accounting firms, that doesn’t necessarily, resolve the tax problems entailed by the Extended Military Benefits Package.

The PBA also believes that, in an ideal world, the city would simply forgive the entire debt, which reportedly has happened in other jurisdictions around the country. It’s not too much to ask for those who have risked their lives at home and over there. In October, Mayor Bloomberg announced that he was forgiving the entire debt for the families of Transit Police Officer James McNaughton and Firefighter Christian Engeldrum, who lost their lives in combat in Iraq. It was, of course, the right thing to do.