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Sequestration could mean a cut in funding for military grocery stores

by Wendy Lee | Take Two®

A customer loads his cart with drinks at the Commissary at Camp Pendleton on Wednesday, Jan. 24. With the help of government subsidies, prices at military grocery stores are an average of 30 percent less than at commercial stores. Maya Sugarman/KPCC

Military families across the country depend on discounted groceries at base commissaries, but they could suffer price increases if the federal government cuts the program's budget.

Among the critics of government-subsidized groceries is Sen. Tom Coburn (R-Okla.). He said  commissaries, like the one at Camp Pendleton in San Diego County, should be able to operate on their own.

“By getting the Department of Defense out of the grocery business here in the United States, Congress could increase military pay across the board and allow military members to shop at stores of their choice,” Coburn said in a report.

Currently, the Department of Defense pays for the commissaries’ staff salaries, utilities and other operating costs, permitting families to shave 30 percent off their grocery bill, and up to 50 percent for meat and produce.

At Camp Pendleton’s main commissary, for instance, apples sold for about $1 a pound – about the cost of what apples sell for at grocery stores in downtown Los Angeles, said Scott Hill, the store director. National brands like Pepsi and Uncle Ben’s rice are sold at only 5% above cost. The profits go to renovating and expanding commissaries.

Depending on their size, military families can save $2,000 to $5,000 a year, Hill said. The Camp Pendleton commissary has evolved with the times, and tries to match customer demand, providing wholesale items similar to Costco. It even offers a fresh sushi counter.

“We don’t operate on profit and we don’t mark products up,” Hill said.

Coburn and others who want to eliminate the federal subsidy for the Defense Commissary Agency’s 248 stores say there is no reason why they can’t be self-sufficient. Critics point to the military’s version of department stores, known as military exchanges, receive little federal support.

Combining the commissaries with military exchanges could save U.S. taxpayers more than $1 billion a year, a Congressional Budget Office report indicated.

Funding for commisaries could also be decreased through automatic spending cuts known as sequestration that will go into effect next month unless Congress takes action.

But a group that represents businesses that work with military commissaries and exchanges say removing federal support is shortsighted.  They say the Department of Defense saves money in the long run by allowing Uncle Sam to save on cost-of-living allowances to service members.

“Take a close look before you cut this program, because you are going to be basically eating your seed corn for a program that reaps benefits far beyond what it costs,” said Steve Rossetti, director of government affairs for the American Logistics Association.

Commissaries and exchanges provide a $20 return in economic benefit to the nation for every $1 of funding given to both programs, the group said. The grocery savings also helps families save money for the future and allows them to spend those dollars at other businesses. 

Budget cuts to commissaries could raise prices, force layoffs and shorten store hours, Rossetti said.

Camp Pendleton Marine Kenneth Keiser said he values the savings when he shops at the commissary for his wife and two children. He said he funnels the extra dollars into savings and taking his kids to nearby attractions like Legoland.

 “It’s more convenient,” Keiser said.

The Defense Commissary Agency, which runs the military grocery stores, said no matter what happens, it will do “everything possible to minimize the impact of any budget decisions” on its customers, which include active, on reserve and retired military members, as well as their families.

The defense commissary said it has already stopped official travel for conferences and training that is “considered noncritical to the agency’s mission.”

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