Housing Allowance Inequity Remedied

Pentagon spokesman Ken Bacon said DoD will add $27 million to the basic allowance for housing to get rid of an “irritant” caused by a new method of measuring service members' stateside housing costs. Service members of the same grade and living in the same area were receiving different allowances.

The new computing system raised allowances in some areas and reduced them in others. But DoD officials gave one-time rate protection to service members in areas where the rates declined -- so long as they did not move, the members would be paid at the higher rate.

However, Bacon said, service members moving into an area were receiving the new, lower rate. The additional $27 million eliminates this inequity, he said.

“This was a problem of great concern for those receiving less money from the government,” Bacon said. “So we’re going to fix this small, but annoying inequity that some service members were experiencing.” He said DoD officials are not sure where the $27 million will come from.

With this action, Bacon said, DoD officials hope all concerned can focus on the larger problem: eliminating out- of-pocket expenses for service members living off-post by 2005. He said service members living off base currently pay about 19 percent of their costs out-of-pocket. Defense Secretary William S. Cohen has proposed reducing those expenses to 15 percent in 2001.

Eliminating out-of-pocket expenses will cost $3 billion.

DoD computes basic housing allowance rates for more than 400 U.S. locations. DoD-wide, about 752,000 service members are eligible for the allowance, and about 73 percent receive it at the "with dependents" rates.