Housing dispute threatens passage of defense bill

A dispute between House and Senate armed services committees over whether to slow growth in military housing allowances and raise off-base pharmacy copayments has put at risk passage of a defense authorization bill.

“This is as bad as I’ve ever seen it,” said one armed service committee staffer, describing the impasse between House-Senate negotiators striving to reach a defense policy bill compromise two months into the new fiscal year.

If no deal can be struck, this Congress would be the first in 52 years not to enact a bill to shape defense policy and resets budget priorities.

It would mean no new programs, thousands of hours of wasted effort on Capitol Hill, and a budget mess for the 114th Congress in late January as Republicans will take charge of both chambers.

linkThe lame-duck Congress also needs to pass a new CR or continuing resolution by Dec. 11 for the Department of Defense to be able to spend at 2014 levels absent a separate deal on a 2015 defense appropriations bill.

Knocking heads over the policy bill are the chairmen of the armed services committees, Sen. Carl Levin, D-Michigan, and Rep. Harold “Buck” McKeon, R-California. Both men are retiring. Both also have colleagues ready to honor them by including their names in the title of the final defense authorization bill. That alone should be incentive for compromise.

For now, however, Levin and colleagues, including prominent Republicans, support the Joint Chiefs’ call to take at least a few steps to slow compensation growth. They accept President Obama’s plan to cap the Jan. 1 military pay raise at 1 percent versus 1.8 to match private sector wage growth. They also would cap Basic Allowance for Housing (BAH) increases for several years, and phase in hefty increases in beneficiary co-pays for drug prescriptions filled off base.

House negotiators don’t support the last two provisions. Capping BAH raises until recipients pay 5 percent of rental costs out of pocket would save DoD $3.9 billion through 2019. Planned increases to drug co-pays would save $1.5 billion in direct health costs by 2019 and $3 billion more in accrual payments to cover drugs costs for elderly retirees and dependents.

That’s money the Joint Chiefs want to divert to readiness accounts as Congress refuses to repeal defense spending cuts for 2016 and beyond as set under the 2011 Budget Control Act and enforced through a spending cut formula called sequestration.

Tom Philpott can be contacted at Military Update, P.O. Box 231111, Centreville, Va. 20120-1111, or by e-mail at:

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