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What Congress Has in Store for You in 2009

2009 Military Pay and Benefit Changes


It's hard to believe another year has passed and our congress-critters have enacted a slew of military pay and benefit changes for 2009. Each year I wade through the annual National Defense Authorization Act and report to you what our congress-critters have passed in the way of military pay and benefit changes for the upcoming year. The bill this year was S. 3001.

At the beginning of the legislative year, the Administration (that would be the President) submits to Congress his recommendations (a "proposal") for military pay and benefit changes for the upcoming year. The respective House and Senate Armed Forces Committees use the proposal as a basic starting point (each will add, delete, or change provisions) in order to arrive at their versions of the annual bill. Provisions in one version of the bill are often not included in another, treated differently, or, in certain cases, they are identical.

Once approved by the Armed Forces Committee, the version is voted on by the full House and full Senate. At this time, many changes, or "amendments" are submitted by various members and voted on by the entire floor as to whether said amendment should be included in their version. The bill then goes to a "compromise committee," composed of both members of the House and the Senate, to iron out the differences between the two bills. The agreed-upon compromise bill then returns to be voted on by the full House and full Senate. If passed by both the House and Senate, the bill goes to the President for signature (or to veto, if the President doesn't like the final version).

This year's Defense Authorization Act has been passed by the full Congress and the President has now signed it into law. Here are the major pay and benefit changes for 2009:

2009 Pay and Benefit Changes

Basic Pay. Section 601 of the bill increases 2009 Basic Pay 3.9 percent over 2008 basic pay rates. This is one-half percent above the average increases in civilian pay wages. This marks the eighth consecutive year that Congress has decided to approve a basic pay increase that was slightly higher than the civilian wage growth for the year. This brings the pay gap between military and civilian wages down to 2.9 percent. The pay raise is effective on January 1, which means that military members will see the raise in their January 15 paychecks.

Basic Allowance for Housing (BAH). As with last year, Congress has funded BAH at 100 percent of the average rental costs for each area. Each year, the Department of Defense conducts in-depth surveys of housing rental costs around the nation. These surveys are then used to set the individual BAH rates for the upcoming year. The 2009 BAH rates average 6.9 percent higher than the 2008 BAH rates. The new BAH will be effective on January 1.

Basic Allowance for Subsistence (BAS). BAS rates are automatically calculated each year, based on the on the Bureau of Labor Statistics' Consumer Price Index, which is prepared by the Department of Agriculture each December. The 2009 BAS rates have increased 10 percent over 2008 BAS rates. The new rates are effective on January 1.

Bonuses. Congress likes to keep tight control over military bonuses, such as enlistment, accession, and reenlistment bonuses. When Congress approves such bonuses, they generally impose a one-year time limit, and then extend the time limit for one year, when they pass the new Defense Authorization Act. This year is no different. Sections 611 through 620 of the bill extends the current bonus authority to December 31, 2009. The bill also makes a few changes to bonus programs: The nurse accession bonus increases from $10,000 to $20,000, and the monthly stipend for nurse officer candidates increase from $1,200 to $30,000 per year. Nuclear offers no longer have to agree to a four or five-year commitment to receive nuclear officer continuation pay. The new bill changes this requirement to three years. The bill also creates a new bonus of up to $12,000 per year for officer candidates who are in training for critically needed foreign languages or cultural studies programs. Finally, a new accession bonus of up to $400,000 per year, and a retention bonus of up to $25,000 per year has been created for psychologists. Keep in mind that while Congress authorizes these bonuses, and sets the maximum amounts payable, whether or not the bonuses are offered are up to the individual services, depending on their current recruiting needs.

Retiree Pay Raise. Military retirees receive an annual COLA, or Cost of Living Allowance, each year to keep up with inflation. This year, the COLA has been set at 5.8 percent. Retirees will see this raise in their January 1 paycheck.

New GI Bill. Congress has created a new GI Bill, which they have dubbed " The GI Bill of the 21st Century " for anyone who has had at least 90 days of active duty after September 11, 2001. Depending on the amount of active duty time, this bill offers several enhanced benefits over the Active Duty Montgomery GI Bill and the Reserve Montgomery GI Bill. Details are still being worked out, but under the new GI Bill program, military members will be able to transfer some of their benefits to spouses and children.

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