Updated June 3, 2024
Defense Primer: Military Commissaries and Exchanges
The Department of Defense (DOD) offers certain quality-
Military Exchanges
of-life benefits to military members, their families, and
DOD maintains an exchange system that includes the Army
retirees. The general purpose of these benefits is to attract,
and Air Force Exchange System (AAFES), the Navy
retain, and support morale and readiness for military
Exchange (NEX), and the Marine Corps Exchange (MCX).
servicemembers. One of these benefits is worldwide access
Each system has its own board of directors to align
to grocery and retail stores—called commissaries and
operations and services. These exchanges provide military
exchanges—typically located on military installations.
installations with goods and services similar to department
Commissaries provide subsidized groceries and household
stores and are often located near commissaries. Some
goods to eligible patrons. Exchanges sell goods for profit,
exchanges also operate gas stations, mini-marts, food
similar to a department or specialty store, but use some of
courts, barber and beauty shops, and liquor stores, some of
this profit to fund various Morale, Welfare, and Recreation
which are operated by outside or contract vendors
(MWR) activities (see Table 1).
According to AAFES, “the exchange system operates more
Organization and Management
than 5,100 facilities with operations in more than 30
Defense Commissaries
countries and four U.S. territories,” and “serves an eligible
The modern commissary system began in 1867. Each of the
customer base of 31 million shoppers.” DOD regulates
services operated its own commissaries and exchanges until
what items may be sold at commissaries and exchanges to
1991, when the commissary system was consolidated under
comply with statutory requirements (10 U.S.C. §2483) and
the Defense Commissary Agency (DeCA). According to the
to avoid direct competition with one another.
DeCA Annual Report for FY2023, as of September 30,
Authorized Patrons
2023, DeCA operated 235 stores on military installations
Authorized patrons of military commissaries and exchanges
worldwide, serving approximately 8.3 million authorized
include active duty, National Guard and Reserve members,
households in 12 countries and 2 U.S. territories; and
military retirees, Medal of Honor recipients, 100% disabled
employing a workforce of 12,820. DeCA aims to provide
veterans, and certain family members or dependents. Since
food savings of over 25% compared to civilian
November 11, 2017, DOD has allowed limited online
marketplaces. As a defense agency, DeCA reports to the
exchange shopping privileges to all honorably discharged
Office of the Secretary of Defense and has a board of
veterans. Veterans may verify eligibility at
directors composed of members from each of the military
https://www.shopmyexchange.com/veterans.
services. DeCA provides subsidized groceries and
On January 1, 2020, more than 4 million service-connected
household goods at cost plus a 5% surcharge that is used to
disabled veterans, Purple Heart recipients, former prisoners
fund new commissary construction and store-level
of war, and their primary caregivers were granted eligibility
refurbishment, maintenance, and equipment.
to full commissary access and certain MWR activities in
Table 1. Breakdown of Commissaries vs. Exchanges
Section 621 of the John S. McCain National Defense
Authorization Act (NDAA) for FY2019 (P.L. 115-232).

Commissaries Exchanges
Section 641 of the FY2020 NDAA (P.L. 116-92), extended
certain MWR privileges to Foreign Service officers of the
Funding
Appropriated
Sales of goods, non-
Department of State on mandatory home leave.
Funds (APF)
appropriated (NAF)
The FY2021 William M. (Mac) Thornberry NDAA (P.L.
Management DeCA Board of
Board of Directors for
116-283) enacted on January 1, 2021, included provisions
Directors
each exchange system
(Sections 631 and 632) that authorized base first responders
Products
Grocery and
Clothing, shoes, uniforms,
the use of commissary stores and MWR facilities, and
household
furniture, computers,
external first responders’ access to mobile commissary or
goods
alcohol, cigarettes, jewelry
exchange stores when deployed to an area covered by a
declaration of a major disaster or emergency.
Online Sales
Limited*
Yes (excludes cigarettes,
On April 29, 2021, DOD announced expanded access
and Delivery
alcohol, and military
uniforms)
effective May 1, 2021, to DOD and Coast Guard civilian
employees and civilian retirees to shop at military
Sources: “About DeCA” at https://www.commissaries.com/our-
exchanges in the United States, U.S. territories and
agency/about-deca; and “Exchange Quick Facts,” at
possessions. Online access became available to these
https://www.aafes.com/about-exchange/exchange-quick-facts/.
patrons in October 2021.Civilian dependents were not
Notes: *In 2013, DeCA started a program offering online ordering
included in this expanded access.
with curbside pickup, known as Click2Go. New features include
ordering via a mobile app and online payment of Electronic Benefits
The NDAA for FY2024 (P.L. 118-31) enacted December
Transfer/Supplemental Nutrition Assistance Program (EBT/SNAP).
22, 2023, included a provision in Section 633 that allows
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Defense Primer: Military Commissaries and Exchanges
remarried surviving spouses access to commissary and
• charging user fees for certain categories of patrons (e.g.,
exchange privileges.
DOD civilian employees).
Funding
Military, retiree, and veteran service organizations have
generally opposed any reduction to the commissary subsidy
Commissaries: Appropriated Funds
and advocate for maintaining the current system. They are
DeCA is an appropriated fund activity (APF). Congress
concerned that changes could dilute the perceived or actual
funds commissary operations with an annual appropriation
benefit for eligible patrons (particularly military retirees
to the DeCA Working Capital Fund (WCF). According to
who may be on a fixed income), harm recruitment and
DeCA’s FY2023 Annual Financial Report, its operation
retention, and reduce the revenues generated for MWR
costs were $1.5 billion. By law (10 U.S.C §2483),
activities. Advocates for the commissary and exchange
appropriated funds may be used to cover employee salaries
systems also note that the systems provide job opportunities
and wages, utilities, communications, operating supplies
for military spouses and other dependents.
and services, food shipments to overseas destinations, and
Those who have proposed a reduction or cancellation of the
other management, equipment, and/or information
commissary subsidy argue that the current benefit is not
technology costs.
efficient or equitably distributed among eligible patrons and
Table 2. DeCA Appropriations FY2020-FY2025
that running a chain of grocery stores is not a core function
of DOD. Some military personnel are assigned to locations
Fiscal Year
Amount in Billions
without convenient access to a commissary. In particular,
FY2020
$1.0
military retirees and reservists may be less likely to live in
close proximity to an installation with commissary services.
FY2021
$1.2
Further, with the expansion of discount grocery stores and
FY2022
$1.2
grocery delivery services, the commissary benefit may not
FY2023
$1.4
be as attractive as it once was. One alternate proposal is for
DOD to use the savings generated from a reduction in the
FY2024
$1.4 (requested)
subsidy towards an annual “grocery allowance” for active
FY2025
$1.6 (requested)
duty military families that could be better targeted to
Source: Overview–FY2025 Defense Budget, Figure 4.3. Military
specific pay grades with higher need (i.e., junior enlisted).
Family Support Programs, on p. 4-14 (PDF p. 72 of 155 pages) at
Proponents for consolidation contend that merging all
https://comptrol er.defense.gov/Portals/45/Documents/defbudget/FY2
systems into a single Defense Resale Activity could save
025/FY2025_Budget_Request_Overview_Book.pdf; and earlier
money by streamlining functions such as accounting,
budget requests at https://comptrol er.defense.gov/Budget-Materials/.
administration and support; allowing for greater flexibility
of products sold; and aligning incentives for commissaries
Exchanges: Non-Appropriated Funds
and exchanges.
Unlike commissaries, exchanges sell merchandise for profit
similar to retail or department stores. In 2022, AAFES
Relevant Statute
reported that it generated over $8.5 billion in annual
Title 10, U.S. Code Chapter 54
revenue and $214 million in dividend-eligible earnings.
Title 10, U.S. Code, Chapter 147
These dividends are paid into the Services’ Central Welfare
Funds, which cover operating expenses, maintain facilities,
CRS Products
and fund MWR programs and services such as leisure
CRS Report R46810, FY2021 National Defense Authorization
travel, fitness centers, Child Development Centers, youth
Act: Selected Personnel and Health Care Issues (and prior-year
programs, outdoor recreation, and movie theaters.
reports), see “Defense Exchange and Commissary Store.”
Commissary and Exchange Reform
CRS In Focus IF11233, Defense Primer: Defense Working Capital
Proposals
Funds, see section “Select Defense-Wide DWCFs.”
Congress has periodically considered proposals to reform
Other Resources
DeCA; such efforts generally have sought to explore ways
to reduce DeCA’s reliance on appropriated funds without
DODI 1330.17, DOD Commissary Program
reducing patrons’ commissary benefits and/or revenues
DODI 1015.10, Authorized Patronage of Military MWR Programs
generated by military exchanges. Some of the past
DOD MWR and Resale Policy Issuances
proposals from military commissions, think tanks, or
DTM 21-003, “Access to Morale, Welfare, and Recreation
legislative agencies have included one or more of the
Category C Online Activities, DoD Commissaries, and Military
following:
Service Exchanges,” April 19, 2023.
• reducing or cancelling the commissary subsidy;
• consolidating the commissary and three exchange

systems into one entity, the Defense Resale Activity
(DeRA);
Barbara Salazar Torreon, Senior Research Librarian
• expanding commissary and exchange eligibility to
Kristy N. Kamarck, Specialist in Military Manpower
additional veteran groups; and/or
IF11089


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Defense Primer: Military Commissaries and Exchanges


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