INSIGHTi
FY2025 NDAA: Basic Needs Allowance for
Military Families
June 17, 2024
In 2023, the House Armed Services Committee (HASC) established the Quality of Life (QOL) Panel to
develop legislative proposals for the 118th Congress. On April 8, 2024, the QOL Panel released its final
report. Several of the Panel’s recommendations were included in the Servicemember Quality of Life
Improvement Act (H.R. 8070). The bill became the vehicle for the House version of the FY2025 NDAA,
known as the Servicemember Quality of Life Improvement and National Defense Authorization Act for
Fiscal Year 2025.
One of the pillars of the Panel’s effort was a review of military pay and compensation. The Panel
recommended increasing the eligibility threshold for a Department of Defense (DOD) benefit called the
basic needs allowance (BNA) to 200% of the federal poverty guidelines. The House version of the
FY2025 NDAA (H.R. 8070) would adopt this poverty threshold and also would remove basic allowance
for housing (BAH) from consideration for the benefit.
Current Law
In the FY2022 NDAA (P.L. 117-81), Congress first authorized the BNA for military families whose gross
household income (GHI) is less than 130% of the Department of Health and Human Services’ (HHS)
federal poverty guidelines. Section 611 of the FY2023 NDAA (P.L. 117-263) expanded eligibility for
BNA to military families with GHI less than 150% of the federal poverty guideline and provides
discretionary authority for the Secretary of Defense to grant BNA to families making up to 200% of these
guidelines if deemed appropriate. Federal poverty line thresholds vary by household size and location.
GHI is defined in DOD policy and includes most sources of household income.
The BNA is an element of compensation for low-income servicemember households that is in addition to
other cash pay (e.g., basic pay, basic allowance for subsistence, BAH). While DOD considers these
elements of compensation as part of GHI, the Service Secretaries have discretion to exclude any portion
of BAH in areas deemed to have a “high cost of living.” Some military family advocates have argued that
despite this Secretarial authority, the default inclusion of BAH in the income calculation precludes needy
families from accessing BNA.
Congressional Research Service
https://crsreports.congress.gov
IN12380
CRS INSIGHT
Prepared for Members and
Committees of Congress
link to page 2 link to page 2 Congressional Research Service
2
Servicemembers must apply for BNA and recertify GHI annually. Servicemembers without dependents
are not eligible. Because BNA is designed to bring households up to 150% of the poverty line, the amount
of assistance may vary by household size. Those most likely to be eligible for BNA are junior
servicemembers with several dependents. BNA is considered taxable income under 26 U.S.C. §61 and is
counted in income eligibility for federal means-tested food assistance programs like the Supplemental
Nutrition Assistance Program (SNAP) and child nutrition programs.
Proposed Legislation
The House version of the FY2025 NDAA would expand eligibility for BNA in two ways (see Table 1).
Table 1. BNA Provisions in the FY2025 NDAA, as passed by the House
House (H.R. 8070)
Section 621 would require BAH to be excluded from the calculation of gross household income for the purpose of
determining BNA eligibility
Section 1804 would raise the eligibility threshold from 150% of the poverty line to 200% of the poverty line.
Source: CRS analysis of legislation on Congress.gov.
Under current law, DOD estimates that in 2025 there would be approximately 2,500 eligible recipients at
a cost of roughly $10 million. The Congressional Budget Office estimates that enacting both Sections 621
and 1804 would expand the BNA-eligible population to about 60,000 households and increase the benefit
provided by an average of $720 per month. CBO estimates that the BNA provisions in H.R. 8070 would
increase costs by $260 million in 2025 and $1.4 billion over the 2025-2029 period. Per 37 U.S.C.
§402b(j), the authority to provide the benefit expires on December 31, 2027. Congress could let the
benefit expire, extend the sunset date, or make the benefit permanent.
The Biden Administration has expressed support for raising the BNA threshold to 200% of the poverty
line, but opposes Section 621 of the House bill, which would exclude BAH from the GHI calculation.
According to the Administration, Section 621 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.” Servicemembers are entitled
to receive either BAH or in-kind housing (e.g., barracks, other government-provided housing). BAH can
be a substantial portion of a servicemember’s take-home pay and varies based on paygrade (rank),
geographic location, and whether the servicemember has dependents. For example, in 2024 the average
annual basic pay for a married E-3 is $29,583 and average BAH is $25,538, with BAH accounting for
42% of total cash pay. As such, removing BAH from the calculation would broaden the eligible pool of
recipients (see sample calculations in Table 2).
Table 2. Sample Cash Pay and Poverty Thresholds, 2024
Average
Average
Total
Total Cash
150% of the
200% of the
Annual
Annual
Annual
Pay w/o
poverty line
poverty line
Rank
Basic Pay
BAH
Annual BAS
Cash Pay*
BAH
(4-person)
(4-person)
E-3
$29,583
$25,538
$5,532
$60,644
$35,106
$46,800
$62,400
E-5
$43,370
$26,845
$5,532
$75,738
$48,893
Source: HHS Poverty Guidelines for 2024 annual thresholds for a 4-person household in the 48 contiguous states. DOD,
Selected Military Compensation Tables, Detailed RMC Tables for Married Personnel, B-2, January 1, 2024.
Notes: Amounts are rounded up to the nearest dol ar. All enlisted servicemembers received the same basic allowance for
subsistence (BAS) regardless of rank. *Total cash pay does not include the tax advantage accrued due to BAH and BAS
being non-taxable allowances.
Congressional Research Service
3
Other provisions in H.R. 8070 could interact with these proposed changes to BNA. In particular, the bill
would amend pay tables for junior enlisted servicemembers, giving E-3s and below a 15% pay raise on
top of 4.5% pay boost tied to inflation for all servicemembers. This proposal, if enacted, could reduce the
size of the population eligible for BNA. Congress may consider the entire package of proposed
compensation reforms in H.R. 8070 as well as other efforts to address financial readiness for junior
servicemembers.
For additional background, see CRS Report R46983, Military Families and Financial Readiness.
Author Information
Kristy N. Kamarck
Specialist in Military Personnel
Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan shared staff
to congressional committees and Members of Congress. It operates solely at the behest of and under the direction of
Congress. Information in a CRS Report should not be relied upon for purposes other than public understanding of
information that has been provided by CRS to Members of Congress in connection with CRS’s institutional role.
CRS Reports, as a work of the United States Government, are not subject to copyright protection in the United
States. Any CRS Report may be reproduced and distributed in its entirety without permission from CRS. However,
as a CRS Report may include copyrighted images or material from a third party, you may need to obtain the
permission of the copyright holder if you wish to copy or otherwise use copyrighted material.
IN12380 · VERSION 1 · NEW