Phosphonates represent an important source of bioavailable phosphorus in certain environments. Accordingly, many microorganisms (particularly marine bacteria) possess catabolic pathways to degrade these molecules. One example is the widespread hydrolytic route for the breakdown of 2-aminoethylphosphonate (AEP, the most common biogenic phosphonate). In this pathway, the aminotransferase PhnW initially converts AEP into phosphonoacetaldehyde (PAA), which is then cleaved by the hydrolase PhnX to yield acetaldehyde and phosphate. This work focuses on a pyridoxal 5'-phosphate-dependent enzyme that is encoded in >13% of the bacterial gene clusters containing the phnW-phnX combination. This enzyme (which we termed PbfA) is annotated as a transaminase, but there is no obvious need for an additional transamination reaction in the established AEP degradation pathway. We report here that PbfA from the marine bacterium Vibrio splendidus catalyzes an elimination reaction on the naturally occurring compound (R)-1-hydroxy-2-aminoethylphosphonate (R-HAEP). The reaction releases ammonia and generates PAA, which can be then hydrolyzed by PhnX. In contrast, PbfA is not active toward the S enantiomer of HAEP or other HAEP-related compounds such as ethanolamine and d,l-isoserine, indicating a very high substrate specificity. We also show that R-HAEP (despite being structurally similar to AEP) is not processed efficiently by the PhnW-PhnX couple in the absence of PbfA. In summary, the reaction catalyzed by PbfA serves to funnel R-HAEP into the hydrolytic pathway for AEP degradation, expanding the scope and the usefulness of the pathway itself.