DOD Beancounters cut allowances for many service members as inflation skyrockets

DoD Releases 2022 Continental U.S. Cost-of-Living Allowance Rates

DEC. 22, 2021

The Defense Department released today the 2022 Continental United States Cost-of-Living Allowance (CONUS COLA) rates, which take effect Jan. 1, 2022. In 2022, $8.5 million will be paid to approximately 6,000 service members stationed within CONUS.

CONUS COLA is a supplemental allowance designed to help offset higher prices in the highest-cost locations in CONUS that exceed the average costs within the CONUS. Rates can increase, decrease, or remain the same, depending upon the non-housing prices in a duty location as compared to non-housing prices in average CONUS.

By law, a contractor provides the Department civilian cost data from each military housing area (MHA) and non-MHA for the following categories: transportation, goods and services, federal income taxes, sales taxes, and miscellaneous expenses.  Data is adjusted to account for the amount of Basic Allowance for Subsistence, an allowance meant to offset the costs for a member’s meals, and for cost savings gained from shopping at commissaries and exchanges.

This information is compared to the same cost data for average CONUS, which serves as a benchmark. The resulting ratio is called an index. By law, a CONUS COLA rate is only prescribed when the index meets a threshold of 108 percent, meaning the costs for non-housing types of goods and services in a particular location are at least eight percent more expensive than average CONUS costs.  An index in excess of 108 percent would qualify for CONUS COLA (e.g., a location that is 10 percent more expensive would qualify for a 2 percent COLA index).

This year, 6 MHAs will receive a decrease in CONUS COLA and 15 will no longer receive CONUS COLA.  

For non-MHA areas (non-metropolitan counties), 20 counties will now receive an index, and 21 will lose CONUS COLA.

Military housing areas with the highest CONUS COLA rates:

New York City, NY                  6%
Long Island, NY                     3%
San Francisco, CA                 3%
Nantucket, MA                       2%

Military housing areas with the largest decreases:

Boston, MA                            4% to 0%
Worcester, MA                       4% to 0%

The total amount of CONUS COLA a Service member receives varies based on geographic duty location, pay grade, years of service, and dependency status.  Payments per CONUS COLA percentage point range from $33 to $59 per month for members with dependents, and from $22 to $45 per month for members without dependents. Service members can calculate their CONUS COLA rate at http://www.defensetravel.dod.mil/site/conusCalc.cfm.

Additional information about CONUS COLA can be found on the Defense Travel Management Office website at http://www.defensetravel.dod.mil/site/conus.cfm.