Purpose of COLA: Why it is going down, what everyone can do about it

  • Published
  • By Tech. Sgt. John Gordinier
  • Alaskan Command Public Affairs
JOINT BASE ELMENDORF-RICHARDSON, Alaska --  DTMOWhat is COLA?

Cost of Living Allowance is an allowance paid above and beyond regular compensation and intended to help offset a change in purchasing power, said Senior Master Sgt. Maryann Navarro-Davis, Alaskan Command Joint Manpower and Personnel Division superintendent and state of Alaska's COLA allowance coordinator. COLA is essentially a cost comparison program that measures the difference between the cost of goods and services purchased OCONUS versus those purchased in the lower 48.

"COLA is definitely not an entitlement or benefit and is not guaranteed pay or allowance," Navarro-Davis said. "It can go up, it can go down or even go away completely, so it is not smart for an Airman to finance against their COLA or they may wind up in financial distress."

Luckily for Airman Snuffy, he asked the right questions and received answers before he went out and financed a sports car against his COLA.

"Unfortunately, our COLA will drop next month due to a correction," said Navarro-Davis.

Starting August 16, 2015, all Department of Defense military personnel in the Anchorage area will see a decrease in Cost-of-Living Allowance pay. It will drop by six points from the current index. Civilian and military retiree pay rates will not change as a result of this action.

It was recently detected by the Defense Travel Management Office Allowances Branch at DoD Headquarters that military personnel in the Anchorage area were coded with an erroneous index higher than what is authorized. Those stationed in the Anchorage area were receiving an additional cold-weather allowance that was already calculated. In order to correct this error, the Military Advisory Panel and all uniformed services have concurred to a six-point decrease in COLA. There will be no retroactive recoupment of funds already paid however.

Alaskan Command recognized the COLA issue early and requested that an out-of cycle Living Pattern Survey be conducted, said Navarro-Davis. DTMO granted this survey and it will be conducted this fall. Previously, the next survey was not due to be conducted until 2017. Although the survey this fall will not prevent the August COLA reduction, it has the potential to increase or decrease COLA rates starting in 2016. Therefore it is vital that all personnel complete the survey once it is available.

"Each member should actively participate in the surveys and accurately input data as requested, similar to a housing allowance survey," Navarro-Davis said. "The more members that participate, the bigger the pool of data is to accurately substantiate an increase or decrease in pay. Failure to participate in these surveys can have negative ramifications on everyone's financial status."
The survey will be advertised base-wide as soon as it is available sometime in August, said Navarro-Davis.

For questions or concerns, please contact Senior Master Sgt. Maryann Navarro-Davis, Alaskan Command Joint Manpower and Personnel Division superintendent at 907-552-4841 or visit http://www.defensetravel.dod.mil/site/cola.cfm.