For the last 40 years the commissaries have been put on the chopping block only to come out strong.
Last year the Senate and House debated privatizing the commissaries over the next several years to save money. They wanted to cut the $1.3 billion annual Department of Defense subsidy for the commissary system. Luckily, this proposal didn’t make it through.
Don’t relax too much thinking the commissaries will be safe now. This year the politicians are at it again.
The House and Senate have come together on a new plan for the FY 2016 Defense Authorization Act. This consists of:
- reducing the FY 2016 commissaries budget cut from $322 million to $30 million;
- they scrapped the idea of privatizing the system and are now requiring a DoD plan to make the commissary and exchange benefit “budget neutral” by the end of 2018;
- authorized DoD to conduct pilot programs to evaluate ways to achieve commissary and exchange budget neutrality; and
- specified that these must maintain high levels of customer satisfaction, provide high-quality products, and sustain the current level of savings for customers.
What does this mean for the average shopper at their local commissaries? The most notable change would be prices. Some patrons would notice their prices going up while a select few might find them going down.
How could this be?
What lawmakers are considering here is variable pricing. Currently, prices are set at commissaries across the board. Under this change, commissaries would see price changes based on location.
Rep. Joe Heck, R-Nev., a brigadier general in the Army Reserves chairs an Armed Services subcommittee that lead the hearings recently on overhauling the stores. He says commissaries could improve how they sell products and become more efficient if they utilized a variable pricing method. Following commercial grocery stores strategies, prices would be set by the market.
For example, prices at commercial grocery stores are higher in New York then they are in Alabama. Just reading this proposal, Fort Drum patrons will be balking at the idea, whereas those at Maxwell AFB may be more open to it since they would be the ones possibly seeing the lower prices.
Heck hopes this plan will help get commissaries to a break-even plan. He says that they currently lose money on every sale.
If that doesn’t do the job, the other plan proposed is to create a commissary brand, much like commercial grocery stores have. Selling items under a Defense Commissary Agency label was part of a consultant lead study that was presented to Congress last fall. This is likely to be the main topic of discussion on the Hill this year.
The worry here for most people is that the quality of the products might not be the same as the commercial brands that are currently being sold at commissaries. The study claims that the products would be at the same level and patrons would still save money over local grocery stores. To match that quality however, there would likely be an increase in prices.
If either of these proposals get enough lawmakers to support it, they could be added to the National Defense Authorization Act, which is a huge bill that shapes military policies and takes most of the year to work through.
Will commissaries see changes this year or are they safe, at least for another year?
Only time will tell, but if the last 40 years of failed proposals to cut the DoD subsidy have a standing basis then maybe things won’t change.
Once the presidency changes, initiatives might as well. Everything is a big “if” for the moment and commissary patrons will be watching closely to see if one of the greatest nonpay benefits for service members will see a big change.