Most Troops Will See More Money Next Year

The Defense Department on Monday announced 2015 pay and compensation rates for service members.

Along with the 1 percent pay increase for most troops – Congress froze pay for general and flag officers next year – service members also will receive boosts in their basic housing allowance and basic subsistence allowance in 2015. The BAH will increase on average $17 per month, or 0.5 percent, according to Defense. The basic allowance for subsistence, a nontaxable payment to service members to help them buy food, will rise 2.9 percent in 2015 from 2014. For enlisted members, that will be $367.92 per month, effective Jan. 1; for officers, it amounts to $253.38 per month.

Service members can calculate their basic housing allowance here.

Two changes were made to the BAH for 2015: Renter’s insurance was eliminated and the fiscal 2015 National Defense Authorization Act reduced the allowance by 1 percent, rejecting the Pentagon’s proposed 5 percent decrease. “However, individual rate protection for service members remains an integral part of the BAH program. This means that even if BAH rates decline – including through the elimination of renter’s insurance and the reduction in the calculated rate – a service member who maintains uninterrupted BAH eligibility in a given location will not see a rate decrease,” Defense said in a press release. “This ensures that service members who have made long-term commitments in the form of a lease or contract are not penalized if local housing costs decrease.”

The department also released its 2015 contiguous U.S. cost-of-living allowance rates. CONUS COLA, as it’s called, is a taxable supplemental allowance designed to help offset higher prices for service members living in expensive locations across the country. Service members can use this calculator to figure out their CONUS COLA rate. “Roughly 12,000 members will see a decrease in their CONUS COLA payments, while some 7,000 members will see an increase or no change, and 4,000 members will no longer receive a CONUS COLA payment,” Defense said in a statement.

President Obama on Friday signed the fiscal 2015 NDAA into law, which included provisions affecting next year’s basic pay and compensation rates for the military.

Here are some other changes in the law related to pay and benefits:

•   Military pensions: Those who first join the military before Jan. 1, 2016, would be exempt from reduced cost-of-living adjustments that apply to military retired pay under the bill. The current law grandfathers in those who joined the military before Jan. 1, 2014. Congress in February repealed a provision in the 2013 Bipartisan Budget Act that cut the pensions of working-age military retirees until they reach the age of 62. 
•  TRICARE co-pay increase: A $3 increase in certain pharmacy co-payments but no increase in mail-order generic drug co-pays.
•   Rehiring retirees: A measure in the NDAA would extend for another five years agencies’ authority to rehire federal retirees without reducing their salaries by the amount of their pensions – what’s known as a salary offset. Before Congress granted the authority in 2009, agencies rehiring annuitants had to request salary offset waivers on a case-by-case basis from the Office of Personnel Management.
•   Military commissaries: The legislation rejected the administration’s proposal to cut money for military commissaries, the heavily-subsidized stores on base where service members and their families buy food and other goods. The bill requires the Defense Department to consult with retail grocery experts to find savings in the commissary system.
•  TRICARE and mothers: A provision based on a stand-alone bill introduced by Rep. Lois Capps, D-Calif., in April requires the military’s health care system to provide breastfeeding support, supplies and counseling for women during pregnancy and after birth.
•   Military spouse employment: The bill directs the Defense secretary to release a report evaluating the progress of the Military Spouse Employment Program in reducing military spouse unemployment, reducing the pay gap between military spouses and their civilian counterparts and addressing the underemployment of military spouses.