News | April 3, 2006

BAH increases

By Staff Sgt. Michael Voss 1st Fighter Wing Public Affairs

Why are Basic Allowance for Housing rates so varied? Why are E-7s paid more BAH in Norfolk, 22 miles down the road, than in Hampton?

This actually turns out to be a myth ... sort of. It depends on the rank of the individual. True an E-7 does receive a higher rate, but this is not across all ranks. With dependents, O-5’s, 6’s and 7’s actually receive more money on the peninsula, and O-4’s are within $10 of the Norfolk area.

The Department of Defense established the housing rate system as a way to compensate those servicemembers and their families who decided to reside outside military housing. According to a recent article in the Air Force Times, “this year marks the end of the DOD’s effort to raise the allowance rates to a level that fully covers average rental costs and eliminates out of pocket expenses.”

“The rates are still a little low ... what hurt was a couple years ago, the increases each year from the surveys were low and the housing market went up really fast,” said Starlyn Kelley, 1st Fighter Wing Housing/Relocation Specialist. “This was when each service submitted rates and there was no combined effort with quality review. When Langley became the primary focus for the Peninsula, you can see the rates this year received a substantial increase,” said a representative from the Langley housing office.

BAH is evaluated each year by DoD and determined by rental market analysis of more than 350 areas around the country to try to geographically equal the amount of median monthly cost of rent a civilian might have to pay.

“BAH is figured by the location where you are stationed, not where you live,” said Mrs. Kelley. Airmen at Langley receive the same rate for BAH if they live in Buckroe Beach or Poquoson -- even though the cost of housing in the two communities is remarkably different.

“For example this year if you are stationed on the peninsula; Fort Eustis, Fort Monroe or Langley, you receive the same rate of BAH ... whether the servicemember lives in Hampton or York County does not play into it,” said Mrs. Kelley. “Also many of our members are in joint service positions and the determination is where the member is stationed.”

In the Hampton Roads area, house prices range from the $100,000 average to more than $300,000 within blocks. But, this doesn’t account for the difference in Langley and Norfolk areas. For example, an E-6 in the 23518 Norfolk zip code receives $1,323 with dependents and $1,060 without. That same E-6 in the 23665 Hampton zip code receives $1,217 with defendents and $931 without. This is a $100 difference with or without dependents.

The explanation goes back to the analysis used to determine the BAH rates each year. The officials who use the survey to determine the rates each year take a median rate of civilian income that pay for homes between the extremely nice to places just shy of boxes.

Also added to the problem is the view of some in the Pentagon that enlisted members should not expect to live in single-family detached homes until they reach the grade of E-9, according to Joyce Raezer, government relations director for the National Military Family Association, as quoted in the Air Force Times.

“The criteria we were giving for the survey by the DoD stated an E-6 with dependents or an O-3 without dependents is expected to need a three-bedroom townhouse,” said Susan Pennington, 1st Fighter Wing Housing Management Assistant.

There is change in sight, however. The Office of the Secretary of Defense has been quoted as wanting to see more flexibility built into the BAH system to better reflect housing market changes on a consistent basis. Along with the SecDef, there are Langley people who agree that changes need to come and are already hard at work to fix the problem.

“We know that a three-bedroom townhouse is usually not where an E-6 with kids, several years in service and lots of furniture expects to live,” said Mrs. Kelley, who was in-charge of the BAH survey for the peninsula bases. “When we did the survey this year, we took time to consider the more desirable, safe neighborhoods, so that while the service member is away, the family can feel at home,” she said.

“We are working hard to bring the BAH rates to a current standard,” said Mrs. Kelley, “and I think that was reflected in the increases received this year.”
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