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Cohen Housing Allowance Initiative Takes Wing

By Jim Garamone
American Forces Press Service

WASHINGTON, Oct. 31, 2000 – The Cohen Initiative to reduce the out-of-pocket expenses of service members living off- base has been approved, and service members will start seeing the results Jan. 1.

As part of the Floyd D. Spence National Defense Authorization Act for Fiscal Year 2001 signed by President Clinton Oct. 30, changes are coming to the Basic Allowance for Housing, said Navy Capt. Elliott Bloxom, DoD director of military compensation.

By law, BAH was supposed to have been calculated with a typical service member living off-base paying 15 percent of expenses out-of-pocket. However, due to budget shortfalls over the years, affected service members report paying an average of 18.8 percent. Members living on-base, of course, do not pay this money.

"It’s not fair and we are going to change this," Defense Secretary William S. Cohen told soldiers during a stop in Kuwait earlier this year. In January 2000, he proposed to eliminate the out-of-pocket expenses in steps by fiscal 2005.

In the fiscal 2001 Authorization Act, Congress has agreed with Cohen and started the process. First, they eliminated the 15 percent statute. Then, they authorized and funded BAH so the percentage should initially drop from 18.8 percent out-of-pocket to around 14.75 percent.

"We see this as a positive sign that everybody will start seeing more in their housing allowances," Bloxom said.

Other changes are happening to the BAH rate under the act. Service members in grades E-1 to E-4 will have a single rate (with dependents and without), and the legislation increases the standard for determining the E-4 rate.

The act also extends service secretaries the discretionary authority to pay E-4s BAH while on sea duty. The current discretionary authority has covered only E-5s. Service members in grades E-6 and above are entitled to BAH while assigned to sea duty.

"This is well in step with the secretary’s intent to eliminate the out-of-pocket cost for our members by 2005," Bloxom said. "We’ve seen the congressional support for this initiative, and we believe it will continue."

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Related Sites:
Statement by the President: Signing of the 'Floyd D. Spence National Defense Authorization Act for Fiscal Year 2001'
2001 Pay Charts

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