The Department of Defense recently released the 2019 Basic Allowance for Housing rates. BAH rates will increase an average of 2.55 percent when the new rates take effect on January 1, 2019. An estimated $21 billion will be paid to approximately one million service members.
The 2019 BAH program expands the member cost-sharing element (out-of-pocket expense) while continuing to balance the growth in compensation costs. Based on the authority provided in the FY 2016 National Defense Authorization Act, the cost-sharing element was increased to five percent. For 2019, a typical member will need to absorb five percent of the national average housing cost by pay grade. The out-of-pocket amounts incorporated in the 2019 BAH rates vary by grade and dependency status and range from $66 to $149 monthly. This rate computation change balances the growth of certain military pay and benefits in a fair, responsible, and sustainable way. Even with these nominal changes, the overall military pay and benefits package remains robust and healthy.
Housing cost data are collected annually for more than 300 military housing areas in the United States, including Alaska and Hawaii. Cooperation from the services and local military housing offices is an important part of the BAH process. Input from local commands is used to determine in which neighborhoods data is collected and to direct the data collection effort toward adequate apartment complexes and individual housing units.
Median current market rent and average utilities (including electricity, heat, and water/sewer) comprise the total housing cost for each military housing area and are included in the BAH computation. Total housing costs are developed for six housing profiles (based on dwelling type and number of bedrooms) in each military housing area. Basic Allowance for Housing rates are then calculated for each pay grade, both with and without dependents.
Individual rate protection is an important part of the BAH process. No matter what happens to measured housing costs – including the out-of-pocket adjustment, an individual member who maintains uninterrupted BAH eligibility in a given location will not see his or her BAH rate decrease. This ensures members who have made long-term commitments in the form of a lease or contract are not penalized if the area’s housing costs decrease.
The Department is committed to preserving a compensation and benefit structure that provides members with a suitable and secure standard of living to sustain a trained, experienced, and ready force now and in the future.
For more information on Basic Allowance for Housing, including the 2019 Basic Allowance for Housing rates and 2019 Basic Allowance for Housing rate component breakdown, visit https://www.defensetravel.dod.mil/site/bah.cfm. Service members can calculate their BAH payment by using the Basic Allowance for Housing calculator at: http://www.defensetravel.dod.mil/site/bahCalc.cfm.
