Lawmakers dropped several incentive pay and quality-of-life reforms for service members and their families from compromise defense policy legislation, including a proposal to expand eligibility for the basic needs allowance by removing basic allowance for housing from income calculations.

Congress first authorized the basic needs allowance in the 2022 National Defense Authorization Bill to address food insecurity among military families. But almost immediately, advocates and lawmakers flagged the program’s major flaw – many lower-income service members didn’t qualify for the stipend due to the inclusion of the basic allowance for housing in income calculations, pushing many families above the program’s eligibility threshold. 

The program had a low participation rate from the start — DoD estimated that there would be about 2,500 people eligible to receive the stipend at a cost of roughly $10 million. Meanwhile, the Pentagon’s own 2023 survey estimated that about one in four service members — or approximately 286,000 troops — struggled with food insecurity. 

The fiscal 2025 defense policy bill proposed expanding eligibility for the basic needs allowance by raising the eligibility threshold from 150% of the poverty line to 200% and excluding basic housing allowance from the calculation of gross household income. While Congress adopted the higher poverty threshold provision, lawmakers dropped the basic housing allowance proposal from the final bill.

The Congressional Budget Office estimated that the two proposals combined would have expanded BNA eligibility to 61,000 service members and cost the department $260 million in 2025 and $1.4 billion over the 2025-2029 period. 

The Biden administration said at the time that excluding basic housing allowance would “result in a much less targeted expansion of payments and come at a cost of $2.8 billion in FY 2025 that is not provided.”

The House tried to reform the basic needs allowance once again in the 2026 defense policy bill, but the proposal was ultimately stripped from the measure.

In the joint explanatory statement, lawmakers said that “quality of life measures, including increases in allowances, are addressed elsewhere in this Act.”

Lawmakers also rejected a Senate-backed pilot program proposal to provide coupons to junior enlisted service members to purchase food at commissaries. Members of Congress said the Defense Department already maintains “multiple, comprehensive food-security initiatives across the enterprise,” including a department-wide working group and congressionally mandated data collection and reporting requirements.

“These efforts collectively provide a robust framework for assessing and addressing food insecurity among servicemembers and their families, as well as existing annual reporting to Congress,” the lawmakers said. 

Also omitted is a House proposal to permanently expand the Pentagon’s authority to temporarily adjust housing allowance rates in high-cost areas. While Congress has given the department temporary authority to raise basic allowance for housing in places where costs jump by more than 20% in a single year, the authority is too limited to allow DoD to respond to rapid and frequent housing cost increases in many military communities. 

The bill would have lowered the threshold for mid-year temporary BHA increases from 20% to 15% of the overall increase in cost of living from the previous year.

Incentive pay provisions dropped

The House version of the defense policy bill sought to establish a five-year pilot program to assess whether offering incentive pay to enlisted service members with college degrees related to their military specialties would improve retention. Under the program, the department would have paid monthly incentives to enlisted service members with less than four years of service who hold a degree in their military specialty and are committed to reenlisting. 

While the Senate version of the bill contained a similar provision, both proposals were dropped from the final measure.

“We note that the military departments possess broad authorities…to provide special and incentive pays to meet service-specific personnel needs. These authorities enable the military departments to recognize critical skills or qualifications, including academic expertise where appropriate,” the lawmakers said in the joint explanatory statement.

The House also tried to overhaul cyber assignment incentive pay by requiring a standardized, department-wide framework. The proposal would have defined uniform eligibility criteria, established a tiered pay structure based on proficiency levels, ensured pay parity across services and protected incentive pay during permanent change of station moves. The provision was ultimately dropped from the bill.

Reimbursement for specialty care travel expenses

A House-backed proposal sought to increase access to specialty care by lowering the threshold for travel reimbursement for medical appointments from 100 miles to 50 miles. The final version of the bill, however, adopted a 75-mile threshold.

The Senate cleared a key procedural hurdle on Monday, moving the must-pass bill closer to final passage.

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