• Impacts nearly 85,000 Service members in 53 MHAs and 23 other counties in the Continental United States.

• Compensates for a portion of excess costs for non-housing expenses incurred in areas that exceed costs in an average U.S. military location by more than 8%. Housing and housing related costs are covered under the basic allowance for housing (BAH) and excluded from CONUS COLA. Members must absorb the first 8% of expenses above the national average.

• An average E-6, with dependents and 10 years of service, receives $29 per month for each COLA index point. Index points currently range from one to twelve.

• Qualification for CONUS COLA is based on geographic duty location, i.e., the zip code of duty station.

• COLA indexes have been computed for all military housing areas (MHAs), which represent major metropolitan areas and installations throughout CONUS. MHAs, a collection of zip codes, are determined and defined by the BAH program. Other non-MHA areas are also considered as eligible for the program based on costs for cities, townships, or urban areas in the vicinity. Indexes are adjusted annually based on new cost data.
  

COMPUTING LOCAL COSTS

• Local market prices are provided by a private contractor.

• Availability and average savings members enjoy through use of Government supported commissary and exchange services are provided by DECA and the exchanges.

• Utilization rates for commissary and exchange facilities are obtained from living pattern surveys conducted approximately once every three years by the Per Diem, Travel and Transportation Allowance Committee through the Defense Manpower Data Center. This survey is mailed to 9950 CONUS-based Service members randomly selected by pay grade, Service, and geographic region.

• Importance of each category of goods and services (weighting) is determined by the Consumer Expenditure Survey conducted by the Bureau of Labor Statistics.

PAYMENT OF COLA

• Payment of COLA is based on regular military compensation (RMC) and spendable income.

• RMC includes basic pay, basic allowance for subsistence, an average basic allowance for housing (BAH), and the tax advantage. Spendable income is total income, less Federal income taxes, housing and housing related expenses, gifts and contributions, life insurance, and savings.

• CONUS COLA is a taxable allowance; an amount is added to cover an average income tax.

• COLA is computed separately for members with and without dependents.

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