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* ATTACHMENTS * . Attachment - Veteran Legislation as of 15 JUN 2016
Attachment - Arizona Vet State Benefits & Discounts JUN 2016
Attachment - Military History Anniversaries 16 thru 30 JUN
* DoD *
Exchange Online Shopping Update 05 ► Still in Limbo Two years after they received a proposal to expand online shopping at military exchanges to all honorably discharged veterans, Pentagon officials are still mulling over the idea. “The policy office has identified some things that need to be included in the proposal, and await the final version so it can be staffed for approval,” said Defense Department spokesman Eric Pahon. “As these recommendations are pre-decisional, it would be inappropriate to say anything more.” He did note that DoD program managers “are aware of the interest in expanding the service benefit that would facilitate online exchange purchases by honorably discharged veterans.”
The idea was initially proposed in May 2014 by Army and Air Force Exchange Service CEO Tom Shull. Navy Exchange Service Command CEO and retired Rear Adm. Robert Bianchi and Cindy Whitman Lacy, director of the Marine Corps Business and Support Services Division, have said they support the idea. The AAFES online site is
ShopMyExchange.com; the NEXCOM site is MyNavyExchange.com. The proposal would allow all honorably discharged veterans to shop at the online stores but it does not extend to brick-and-mortar stores. At the time he proposed it, Shull said the move would increase the online customer base for the military exchange stores, but it would also offer a modest benefit to veterans who didn’t serve long enough to retire from the military, including a number who have served multiple tours in combat in Iraq and Afghanistan.
Currently eligible shoppers include all ranks of active-duty, National Guard and reserve members; retirees; Medal of Honor recipients; honorably discharged veterans with 100 percent service-connected disabilities; DoD civilian employees stationed outside the U.S. and authorized family members. If the concept is approved, the online benefit for all honorably discharged veterans could be rolled out in as little as six months. “With the veterans online shopping benefit, all we’re doing is adding customers to a successful e-commerce business,” said Shull. Over the last two years, AAFES officials have upgraded ShopyMyExchange.com and are scaling up their distribution centers to handle the increased volume if more veterans are allowed to shop; they will also add additional personnel to the call center. The website will be able to handle four times the number orders without straining the system, Shull said. They could scale the online business to handle $1 billion in sales within a year, he said.
To break even on the cost of expanding to these veterans, sales through ShopMyExchange.com would have to increase by about $30 million. In 2015, online sales were $208 million, an increase of 20 percent over sales in 2014, according to AAFES spokesman Chris Ward. The expansion would mean that about 18 million additional veterans would be eligible to shop online; AAFES would break even on costs if fewer than 50,000 of those newly authorized veterans shopped online. The expansion could also benefit the military community, by increasing sales and providing more profits that could be contributed to morale, welfare and recreation programs and to improve brick-and-mortar stores. The current customer base is made up of a finite number of active-duty, Guard and reserve members and retirees and their family members, and that customer base has been shrinking with the drawdown of the military.
In 2011, AAFES profits were $278 million. When Shull took over as CEO in 2012, there was a shrinking customer base and resulting shrinking sales, and he was under increasing pressure to provide more money to MWR programs. Shull cut costs rather than raise prices, including reducing the number of employees worldwide from 42,000 to 35,000. He’s also made changes the shopping experience, such as adding more national brand items, a move that has resulted in increased sales. AAFES upgraded and improved the shopmyexchange.com website, which, after a bumpy start, has also paid off. Sales are up by 32 percent in the first four months of 2016, compared to the same time in 2015. As a result, the profits for 2015 were $402 million, and AAFES provided $236 million to MWR programs. If the cost-saving measures and operational changes hadn’t been taken, officials said, the profits would have decreased to $69 million in 2015.[Source: Military Times | Karen Jowers | June 1, 2016 ++]
Commissary Funding Update 28 ► Budget Neutrality Not Realistic The only way to entirely eliminate taxpayer funding for commissaries is to shut them all down, according to Pentagon officials who have explored a number of alternatives. But that's not an option, nor is drastically increasing prices, Pentagon officials said in a report to Congress: "Either action would significantly reduce the benefit available to commissary patrons, and would adversely impact the customer base of the military exchange system, reducing the availability of dividends for morale, welfare, and recreation activities as well.” And those eligible are using their benefit: 80 percent of eligible, active-duty households shopped at least once at a commissary in the 12 months ending Jan. 31, the report noted. More than 50 percent of those who shopped in commissaries during that period were active-duty households, according to the report.
Defense officials were tasked by Congress last year to develop a plan to achieve “budget neutrality” for the commissary and exchange systems by Oct. 1, 2018 — without diminishing commissary and exchange benefits. That task came after increased efforts within DoD to drastically reduce the taxpayer subsidy in the face of continuing budget pressures. DoD proposed in 2014 and 2015 to gradually cut $1 billion from the commissary annual operating budget.
“Budget neutrality” would mean eliminating the commissary taxpayer subsidy of $1.4 billion and the $400 million taxpayer subsidy received by the three military exchange services. The commissary subsidy allows stores to sell groceries at cost, plus a 5 percent surcharge used for construction. The exchanges are mostly self-supporting, deriving their operating costs by marking up the prices of goods and services. But they receive taxpayer dollars to pay for shipping merchandise overseas, so that prices there are comparable to those at exchanges in the continental U.S.
In their report, defense officials said various initiatives they explored would fall $1.5 billion short of the $1.8 billion in savings to eliminate the taxpayer subsidy, without affecting customer savings, contributions to morale, welfare and recreation programs, or customer service. Instead, DoD predicts it could achieve $300 million per year in savings for the fiscal year beginning Oct. 1, 2018. To get rid of the entire taxpayer subsidy, prices would have to increase by 27 percent, officials said. That would essentially eliminate the existing commissary savings benefit, which is an average of 30 percent compared with local stores. The downward spiral caused by the increases would continue until the commissary system priced itself out of existence, the report noted.
While the taxpayer cost is $1.4 billion a year, the patron savings equates to $2.35 billion a year, DoD officials stated. And there are a number of second- and third-order effects of the commissary benefit, including qualify of life, military readiness and cost avoidance. For example, in the areas of cost avoidance and military readiness, the loss of transportation volume of commissaries and exchanges would increase U.S. Transportation Command fees for the remaining users, increasing the taxpayer funding requirements for military transport across the board. And the commissary prices are a factor in the formula used to compute Cost of Living Allowance rates; the absence of commissary savings could cause the rates to increase for the government.
“The Department believes that, with some legislative relief, it will be possible to maintain current benefits and still achieve efficiencies that result in meaningful savings for the taxpayer,” the report noted. The variable pricing program is among the initiatives DoD is planning to get some savings. Legislation giving DoD that authority passed the House and is being considered in the Senate. This breaks from the decades-old model of commissaries selling groceries at cost plus a 5 percent surcharge. Officials will test variable pricing concepts that will raise or lower prices on individual products. Another initiative is developing commissary private label brands. DoD officials have also explored other alternatives, including privatization of the commissary system; and using discount saving agreements with local grocery stores. However, the report noted, “the Department does not believe that either approach could replicate the range of benefits, level of savings, and geographic reach provided by the Defense commissary system and achieve budget neutrality.”
In spite of this determination, officials said, DoD is continuing to seek more information on the feasibility of privatizing all or part of the commissary system, based on interest from the private sector. Defense officials contacted chief executive officers of 10 major private-sector grocery chains earlier this year, and three expressed interest in pursuing the matter in greater depth, according to the report. Thus, DoD is continuing its research on privatization through a request for information posted on FedBizOpps.gov on May 27. Information is due back to DoD by 15 JUL The request makes clear it is not a solicitation for proposals, but states: “The information gained will assist in developing a plan to privatize all or portions of the Defense Commissary Agency and Defense Commissary System. … The result of this market research will contribute to determining the method of procurement (if any).”
Some senators are once again pushing this privatization concept, as they attempted last year. The Senate Armed Services Committee has included a provision in its version of the fiscal 2017 defense policy bill that would require a pilot program testing privatization at no more than five commissaries on major military bases. But other senators, led by Sen. Jim Inhofe, R-Okla., and Sen. Barbara Mikulski (D-MD) are pushing back, trying to get an amendment considered that would instead require DoD to study the idea and submit a report to Congress by 1 FEB. [Source: Military Times | Karen Jowers | June 7, 2016 ++]
DOD Tuition Assistance Update 04► TA & GI Bill Most Popular Schools For data on TA/GI schools refer to the following:
[Source: Military Times | George Altman | July 16, 2015++]
GI Bill Update 206 ► Ashford University’s Pending Disapproval Over 6,000 veterans attending Ashford University may find their school no longer approved for GI Bill benefits after June 30, 2016. The state of Iowa will be withdrawing its approval for GI Bill benefits after that date. Ashford is attempting to gain approval for its programs from the state of California before the Iowa approval runs out. This would keep GI Bill benefits flowing to enrolled students. However, Bridgepoint Education, the parent company of Ashford, is currently under investigation by the California Attorney General for the company's scholarship and institutional loan programs and other extensions of credit made by Bridgepoint to students, as well as enrollment and retention details. Refer to www.ashford.edu/military.htm for Ashford’s online degree program. [Source: "NAUS Weekly Update" | June 10, 2016 ++]
POW/MIA Recoveries ►Reported 01 thru 15 JUN 2016 | Twelve "Keeping the Promise", "Fulfill their Trust" and "No one left behind" are several of many mottos that refer to the efforts of the Department of Defense to recover those who became missing while serving our nation. The number of Americans who remain missing from conflicts in this century are: World War II (73,515) Korean War (7,841), Cold War (126), Vietnam War (1,627), 1991 Gulf War (5), and Libya (1). Over 600 Defense Department men and women -- both military and civilian -- work in organizations around the world as part of DoD's personnel recovery and personnel accounting communities. They are all dedicated to the single mission of finding and bringing our missing personnel home. For a listing of all personnel accounted for since 2007 refer to http://www.dpaa.mil/ and click on ‘Our Missing’. If you wish to provide information about an American missing in action from any conflict or have an inquiry about MIAs, contact:
Message: Fill out form on http://www.dpaa.mil/Contact/ContactUs.aspx
Family members seeking more information about missing loved ones may also call the following Service Casualty Offices: U.S. Air Force (800) 531-5501, U.S. Army (800) 892-2490, U.S. Marine Corps (800) 847-1597, U.S. Navy (800) 443-9298, or U.S. Department of State (202) 647-5470. The remains of the following MIA/POW’s have been recovered, identified, and scheduled for burial since the publication of the last RAO Bulletin: