ALMARS : 405/97
R 050800Z DEC 97 ZYB
FM CMC WASHINGTON DC//MP//
TO ALMAR
BT
UNCLAS //N07220//
ALMAR 405/97
MSGID/GENADMIN/CMC MPO-41//
SUBJ/FY98 PAY AND ALLOWANCES CHANGES//
REF/A/DOC/NDAA/-//
REF/B/DOC/DODFMR/01JUL96//
REF/C/DOC/JFTR/01NOV97//
REF/D/DOC/SECNAV/31JUL87//
NARR /REF A IS THE FY98 NATIONAL DEFENSE AUTHORIZATION ACT (NDAA).
REF B IS THE DOD FINANCIAL MANAGEMENT REGULATION, VOLUME 7A. REF C
IS THE JOINT FEDERAL TRAVEL REGULATIONS VOLUME 1. REF D IS
SECNAVINST 7220.82 (VARIABLE HOUSING ALLOWANCE (VHA) BASED ON
DEPENDENT LOCATION).//
POC/J. L. TERRY/MAJ/PRIPHN:703-614-3440/-/-/SECPHN:DSN 224-3440/-//
RMKS/1. THIS ALMAR BRIEFLY DISCUSSES MILITARY PAY AND ALLOWANCE
CHANGES AUTHORIZED BY REF A.
2. BASIC PAY. A 2.8 PERCENT BASIC PAY RAISE HAS BEEN AUTHORIZED
FOR ALL MILITARY MEMBERS, EFFECTIVE 1 JAN 98.
3. BAQ AND VHA.
A. EFFECTIVE 1 JAN 98, BAQ AND VHA WILL BE COMBINED INTO A
SINGLE HOUSING ALLOWANCE CALLED BASIC ALLOWANCE FOR HOUSING
(BAH). BAH WILL APPEAR ON MARINES' LEAVE AND EARNING STATEMENTS
(LES), VICE "BAQ" AND "VHA". THE INTENT OF THIS NEW HOUSING
ALLOWANCE IS TO PROVIDE SERVICE MEMBERS WITH A HOUSING ALLOWANCE
THAT IS COMPARABLE TO THEIR CIVILIAN COUNTERPART (OF COMPARABLE
SALARY AND DEPENDENCY STATUS).
B. HOW WILL YOUR BAH RATE BE CALCULATED? A PRIVATE
CONTRACTOR (RUNZHEIMER INTERNATIONAL CORP.) WILL COLLECT DATA ON
MARKET HOUSING COSTS BY LOCATION. THIS DATA WILL BE USED AS THE
BASIS FOR THE BAH RATES. THE CONTRACTOR WILL BE PRICING RENTAL
PROPERTIES WITH HOUSING CHARACTERISTICS SIMILAR TO THOSE RENTED
BY CIVILIANS AT COMPARABLE SALARY LEVELS AS MILITARY MEMBERS AT
EACH LOCATION. FOR COMPARISON PURPOSES, THE CIVILIAN SALARY WILL
BE EQUATED WITH THE MILITARY BASIC PAY, CURRENT BAQ, AVERAGE VHA,
BAS AND THE TAX ADVANTAGE OF THE ALLOWANCES.
C. WHAT WILL THE HOUSING ALLOWANCES BE FOR EACH LOCATION,
PAY GRADE AND DEPENDENCY STATUS? DATA IS CURRENTLY BEING
GATHERED IN ORDER TO MAKE THE FUTURE ALLOWANCE DETERMINATIONS.
HOWEVER, IT IS ANTICIPATED THAT THOSE WHO WILL BENEFIT MOST UNDER
THE SINGLE HOUSING ALLOWANCE SYSTEM ARE:
(1) PERSONNEL IN HIGH COST HOUSING AREAS, AND
(2) JUNIOR ENLISTED GRADES.
D. CAN YOU EXPECT TO SEE A BIG CHANGE IN YOUR HOUSING
ALLOWANCE IN JAN 98? THERE SHOULD BE NO SIGNIFICANT CHANGE IN
HOUSING ALLOWANCES IN THE FIRST YEAR OF IMPLEMENTATION. THE
PROGRAM WILL BE PHASED IN OVER APPROXIMATELY 6 YEARS AND WILL
CONTAIN A "SAVE PAY" PROVISION SO THAT NO ONE WILL LOSE MONEY OUT
OF THEIR PAYCHECK WHILE AT THEIR CURRENT DUTY STATION, AS LONG AS
THEIR DEPENDENCY STATUS DOES NOT CHANGE. DECREASES IN HOUSING
ALLOWANCES FOR THOSE DUTY STATIONS/LOCATIONS REQUIRING A DECREASE
WILL BE PHASED IN, AND WILL APPLY TO MARINES ONLY AS THEY PCS TO
THOSE PDS'S/LOCATIONS. LIKEWISE, LOCATIONS THAT HAVE BEEN SELECTED
FOR INCREASES IN HOUSING ALLOWANCES ALSO WILL BE PHASED IN
ACCORDINGLY.
E. ADDITIONAL BENEFITS UNDER THE BAH LEGISLATION INCLUDE:
(1) BAH WILL BE NON-TAXABLE.
(2) MARINES OF THE SAME PAY GRADE AND DEPENDENCY STATUS
WILL HAVE ALLOWANCES COMPUTED FOR THE SAME OUT-OF-POCKET DOLLAR
AMOUNT FOR THE SAME LEVEL OF HOUSING REGARDLESS WHERE THEY ARE
ASSIGNED IN THE UNITED STATES.
(3) REQUIREMENT FOR ANNUAL VHA SURVEYS IS ELIMINATED.
(4) REQUIREMENT FOR ANNUAL RECERTIFICATION OF HOUSING
COSTS IS ELIMINATED. MARINES WILL STILL BE REQUIRED TO CERTIFY
THEIR DEPENDENCY STATUS WHEN A CHANGE OCCURS (E.G., DIVORCE,
ETC.), AND UPON REPORTING TO A NEW PERMANENT DUTY STATION (PDS).
(5) VHA OFFSET IS ELIMINATED. THIS MEANS MARINES
WILL RECEIVE THE FULL AMOUNT OF HOUSING ALLOWANCE ALLOTTED FOR
THEIR PAY GRADE AND DEPENDENCY STATUS REGARDLESS THE COST OF
THE ACTUAL RENT OR MORGAGE. IN ADDITION, MARINES WILL NO LONGER
BE PENALIZED FOR SHARING RENT.
(6) BAH AT THE RATE PAID AT A MARINE'S OLD PDS WILL
CONTINUE UNTIL THE MARINE REPORTS TO A NEW PDS IN CONNECTION WITH
PCS TRANSFER.
(7) SINGLE MARINES MAY REQUEST BAH BASED ON THEIR RESIDENCE
LOCATION WHEN DIRECTED TO EXECUTE A NO-COST CLOSE PROXIMITY PCS MOVE
AND COMMUTE DAILY FROM THE SAME RESIDENCE TO THE NEW PDS. THIS
REMOVES THE CURRENT INEQUITY BETWEEN SINGLE MARINES AND MARINES WITH
DEPENDENTS. (MARINES WITH DEPENDENTS MAY ALREADY REQUEST VHA BASED
ON DEPENDENT'S LOCATION WHEN EXECUTING THE SAME NO-COST CLOSE
PROXIMITY PCS MOVE AND ARE COMMUTING DAILY.)
(8) DISLOCATION ALLOWANCE (DLA), FAMILY SEPARATION ALLOWANCE
(FSA)-TYPE I, AND BAQ-DIFF WILL REMAIN AT THE CURRENT DOLLAR AMOUNTS
AND WILL BE INCREASED AT THE SAME RATE AS BASIC PAY. MARINES PAYING
CHILD SUPPORT PRIOR TO 4 DEC 91 AND CURRENTLY GRANDFATHERED AT THE
BAQ-WITH DEPENDENT AMOUNT WILL CONTINUE TO RECEIVE THAT AMOUNT UNTIL
THEY PCS. HOWEVER, THE BAH LEGISLATION DOES NOT PROVIDE CONTINUED
GRANDFATHERING OF THESE MARINES, AND THUS, UPON PCS THEY WILL LOSE
THAT PROTECTION AND WILL START DRAWING BAQ-DIFF EFFECTIVE THE DATE OF
REPORTING TO THEIR NEW PDS.
F. MARINES ASSIGNED OVERSEAS AND RECEIVING OVERSEAS HOUSING
ALLOWANCE (OHA) WILL NO LONGER SEE "BAQ" ON THEIR LES. THEIR
"BAQ" DOLLAR AMOUNT WILL BE INCLUDED IN THE DOLLAR AMOUNT LISTED
UNDER THEIR "OHA".
G. ENTITLEMENT TO BAH WILL BE THE SAME AS THAT CURRENTLY IN
EFFECT FOR BAQ. THE DOD FINANCIAL MANAGEMENT REGULATION (REF B)
IS BEING REWRITTEN BUT WILL REMAIN IN EFFECT UNTIL REVISED. THE
PORTIONS OF THE JOINT FEDERAL TRAVEL REGULATIONS (REF C)
CONCERNING VHA WILL BE DELETED AND INCORPORATED INTO REF B, AS
APPLICABLE.
4. BASIC ALLOWANCE FOR SUBSISTENCE (BAS) REFORM.
A. BEGINNING 1 JAN 98, ENLISTED MARINES POSSESSING MEAL
CARDS WILL BEGIN RECEIVING A 31 CENT A DAY PARTIAL BAS ALLOWANCE.
PARTIAL BAS WILL BE INCREASED ANNUALLY OVER THE NEXT 6 YEARS.
AT THE END OF THE 6 YEAR PERIOD, PARTIAL BAS PAYMENTS WILL
CEASE, AND ALL ENLISTED MEMBERS WILL BEGIN RECEIVING FULL BAS.
MARINES WILL STILL BE REQUIRED TO SUBSIST IN THE MESSHALL, HOWEVER,
AVAILABLE MEALS (FOR EVERY MEAL WHETHER EATEN OR NOT) WILL BE
DEDUCTED FROM THEIR PAY. ALTHOUGH PAYING FOR GOVERNMENT MEALS,
MARINES SHOULD STILL POCKET APPROXIMATELY $30 PER MONTH. LES'S
WILL REFLECT BAS IN THE ENTITLEMENT SECTION AND A DEBIT FOR AVAILABLE
MESSHALL MEALS.
B. FOR OFFICERS AND ENLISTED MARINES WHO NOW RECEIVE THE
ALLOWANCE, BAS WILL INCREASE ANNUALLY BY ONE PERCENT EACH YEAR
DURING THE TRANSITION PERIOD. THE DIFFERENCE BETWEEN THIS ONE
PERCENT BAS INCREASE AND THE BUDGETED ANNUAL INCREASE WILL BE
USED TO OFFSET THE COST OF PAYING BAS TO THOSE ENLISTED MARINES
WHO ARE CURRENTLY RECEIVING SUBSISTENCE-IN-KIND.
C. THIS PLAN SOLVES TWO MAJOR PROBLEMS: (1) MARINES WILL NO
LONGER LOSE BAS WHEN THEY DEPLOY (HOWEVER MEALS WILL BE DEDUCTED
FROM THEIR PAY), AND (2) IT WILL BRING THE SUBSISTENCE ALLOWANCE
MORE IN LINE WITH REAL FOOD COSTS AS CALCULATED BY THE DEPARTMENT
OF AGRICULTURE.
5. FAMILY SEPARATION ALLOWANCE (FSA). THIS ALLOWANCE WILL BE
RAISED TO $100 PER MONTH, A $25 INCREASE OVER CURRENT RATES.
6. HAZARDOUS DUTY INCENTIVE PAY (HDIP). THIS ALLOWANCE WAS
INCREASED TO $150 PER MONTH, A $40 INCREASE OVER CURRENT RATES. THE
MAXIMUM ALLOWANCE FOR SOMEONE INVOLVED IN DUTIES WITH MULTIPLE
HAZARDS HAS GONE UP TO $225 A MONTH.
7. AVIATION CAREER INCENTIVE PAY (ACIP). EFFECTIVE 1 JAN 99,
ACIP WILL INCREASE FOR AVIATORS. UNDER CURRENT LAW, AVIATORS
WITH 6 TO 18 YEARS OF SERVICE RECEIVE $650 A MONTH IN ACIP,
AFTER WHICH THE PAY DROPS TO $585 A MONTH. THE CHANGE WILL
KEEP FLIGHT PAY THE SAME ($650) FOR AVIATORS SERVING BETWEEN 6 AND 14
YEARS OF SERVICE, THEN RAISE PAYMENTS TO $840 A MONTH FOR
AVIATORS SERVING BETWEEN THE 14TH AND 22ND YEAR OF SERVICE. IN
THE 23D YEAR, FLIGHT PAY WILL DROP TO $585 A MONTH AND CONTINUE TO
TAPER OFF AS IT DOES NOW.//
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