• Commissary System Unlikely to Achieve ‘Budget Neutrality,’ DOD Finds

    Commissary System Unlikely to Achieve ‘Budget Neutrality,’ DOD Finds0

    There is no way to operate military grocery stores while preserving the commissary savings benefit for military families without a significant taxpayer subsidy, according to a Pentagon report submitted to Congress. DOD concluded that it could eliminate only a small piece of the $1.4 billion annual subsidy provided by Congress to operate the commissary system. Congress requested the report to identify ways to achieve “budget neutrality” for the commissary and exchange systems by Oct. 1, 2018, without trimming commissary and exchange benefits, reported Military Times. The department believes it could achieve only $300 million in annual savings beginning Oct. 1, 2018 …

  • Pentagon Takes First Step in Commissary Privatization

    Pentagon Takes First Step in Commissary Privatization0

    The Defense Department shortly will issue a request for information from companies with the capability to take over the operation of all or part of the military commissary system. This initial step by DOD to better assess the feasibility of privatizing commissaries comes at the request of Congress. “This is a request for information only. It is important to emphasize that NO decision has been made to privatize commissaries and the department is NOT soliciting actual proposals for privatization,” said DOD spokesman Air Force Maj. Ben Sakrisson …

  • Authorization Bill Would Expand Testing of New Commissary Pricing Policy

    Authorization Bill Would Expand Testing of New Commissary Pricing Policy0

    Military grocery stores would introduce variable pricing and private label products in an effort to slash the federal subsidy supporting commissaries, under the portion of the fiscal 2017 defense authorization bill marked up by the House Armed Services’ Military Personnel Subcommittee on Wednesday. The two changes are intended to increase commissaries’ profit margin, but the legislation aims to protect the commissary benefit for military families, which has been estimated at providing shoppers up to a 30 percent savings. DOD already had been planning on testing these new options this summer, as it had been authorized in last year’s defense policy bill …

  • Budget Cut Not Intended to Harm Commissary Benefit, DOD Says

    Budget Cut Not Intended to Harm Commissary Benefit, DOD Says0

    Military grocery operations would suffer a $221 million cut under the department’s fiscal 2017 budget request, but the Pentagon’s top financial officer said the proposal would not lower the commissary benefits enjoyed by military families. “This year’s proposal is a different proposal,” Comptroller Mike McCord told reporters Tuesday. “A more modest proposal financially that only tries to get savings out of the business end, does not touch the benefits. So, that’s different in an important way, I think from the troops’ perspective to last year,” McCord said. Last year, the department proposed slashing the Defense Commissary Agency’s budget by $322 million in FY 2016 — out of a total allocation of $1.4 billion — and $1 billion in FY 2017, but lawmakers restored much of that funding for the current year …

  • House Chairman, Military Family Advocates Bicker over Changes to Commissary Operations0

    Variable pricing, and not privatization, may be the tool that helps military grocery stores operate without government subsidies, Rep. Joe Heck (R-Nev.), chairman of the House Armed Services’ Military Personnel Subcommittee, said Wednesday during a hearing on possible changes to the commissary system. “It’s what every grocery chain does across the country,” said Heck, reported Stars and Stripes. Variable pricing would allow commissaries to adjust product pricing depending on the region where they are sold. The stores now are required to sell items at cost, plus a 5 percent surcharge that is used primarily for construction and renovation of stores …

  • Consolidation of Military Retailers Won’t Be Necessary, DOD Official Says0

    Defense officials believe that consolidating the military’s commissary and exchange systems will not be necessary to find sufficient savings that would allow the federal government to slash its support for the military’s resale operations. “We believe we can get efficiencies without consolidation,” Peter Levine, DOD’s deputy chief management officer, said during the annual convention of the American Logistics Association. The department had proposed reducing the $1.4 billion annual federal subsidy for military grocery stores by $1 billion in response to budget constraints. But lawmakers are concerned that budget-driven spending cuts would undermine the benefit for military families …