DeCA is responsible for operating DOD’s worldwide commissary system. The active duty community has unlimited access privileges to the commissaries as do the other members of the customer base. Reservists, on the other hand, are (1) authorized 12 visits per year if they have earned a minimum number of points creditable for retirement and (2) access during any period of active duty service. Evolution of Commissary Access Policy for Reservists

Prior to 1986, Selected Reservists were allowed commissary privileges only during periods of active duty—normally 14 days during each year—but not during weekend drills. The current reservist access policy was established in 1990. None of the proposals were adopted by Congress. For fiscal year 1996, DOD proposed that “Gray Area” retirees be granted permanent, unlimited commissary access and that the other reservists be provided unlimited access for a 1-year test period. No plans have been developed to conduct the field tests proposed in fiscal years 1996 and 1997. Commissary Funding Sources

Commissary funding is obtained from two primary sources—an annual appropriation and a surcharge added to each sale. For fiscal years 1992 to 1996, DeCA’s total obligations have averaged about $1.31 billion annually, about $1 billion (over 70 percent) in appropriated funds and $315 million from the surcharge. Appropriated Funds

The largest funding source is the annual congressional appropriation. DeCA has received an average of about $1 billion annually for the 5 years of its existence. Information Needed to Assess the Impact of Policy Change

The actual financial impact, if any, of allowing reservists unlimited access would depend on the extent of additional commissary sales and increased costs generated as a result of programmatic changes DeCA might make to accommodate any increase in sales. We believe DOD and DeCA could develop reliable estimates of the potential impact of this policy change using a study and data analysis approach and that such an approach would be more appropriate than a field test. Key elements of such a study are discussed in the following sections. Commissary Locations, Reservist Populations, and Increased Usage

To identify locations where increased patronage is most likely, DeCA needs to analyze the locations of commissaries in relation to concentrations of reservists and the distances to individual stores. For example, (1) reservists could be surveyed by interview at commissary stores determined to be most likely to experience increased patronage, (2) reservists could be surveyed on a nationwide basis to gain insight into any anticipated changes in buying patterns and commissary usage, and (3) commissary store managers could be interviewed for their views and estimates of potential increases (if their estimates were thought to be reliable). Such a methodology could be applied to the commissary system to develop a range of estimates of the impact on personnel and other costs generated from various percentages of projected increased patronage and sales from reservists, that is, 5, 10, 15, 20, etc. Recommendation

We recommend that the Secretary of Defense ensure that any future legislative proposal to expand commissary access for military reservists be supported by a methodologically sound analysis that estimates the potential impact on appropriated fund support for the commissary system. Agency Comments

DOD concurred with our recommendation and stated that DeCA and the Office of the Assistant Secretary of Defense (Reserve Affairs) will jointly develop a survey targeted to ascertain the impact expansion of commissary access to military reservists will have on the commissary system. Scope and Methodology

Our study of the Department of Defense (DOD) policy regarding access to the commissary system by military reservists and proposed changes to allow unlimited access was conducted primarily at offices in the Office of the Secretary of Defense in the Pentagon and at Defense Commissary Agency (DeCA) headquarters at Fort Lee, Virginia.
Why GAO Did This Study

Pursuant to a legislative requirement, GAO reviewed proposals to change the Department of Defense (DOD) policy that limits military reservists' access to commissary stores, focusing on the: (1) evolution of the policy on military reservists' access to the commissaries and proposals to change that policy; (2) sources of the Defense Commissary Agency's (DCA) funding; and (3) information needed to analyze the impact on appropriated funds of granting military reservists unlimited access to the commissary system.

What GAO Found

GAO found that: (1) commissary access for military reservists before 1986 was limited to a maximum of 14 days and was authorized only during periods of active duty training; (2) since 1990, reservists have been authorized to earn 12 visits a year to the commissary system in addition to access during any period of active duty service; (3) DOD has submitted three proposals since 1990 to grant reservists unlimited access, but none have been adopted by Congress because of concerns about the impact such a change might have on the level of appropriated funds and the concerns expressed by civilian grocery providers about the impact on their businesses; (4) the commissary system is funded primarily from an annual appropriation that has averaged about $1 billion for fiscal years (FY) 1992 through 1996; (5) the other funding source is the 5-percent surcharge that is added to each sale in all commissary stores, which has provided an average of about $315 million over the same period; (6) while DOD has proposed legislation to grant reservists unlimited commissary access, it has not developed estimates of the potential financial impacts of such a policy change; (7) potentially, any increase in the commissary customer base, such as granting unlimited access to reservists, could increase the sales and overall workload of the commissary system and increase personnel costs, which could, in turn, increase the level of appropriated funds needed for commissary operations or, at least, cause funding levels to be higher than they would otherwise be; (8) DOD's FY 1996 and 1997 proposals called for variations of a 1-year field test to identify the effects of increased access for reservists on commissary operations; (9) field tests would give specific individuals unlimited commissary access for 1 year to develop impact studies; (10) such a test runs the risk of appearing to withdraw a benefit following the test's conclusion; (11) GAO believes that a methodologically sound study, using data that could be developed by DOD and DCA, could provide reliable estimates of the financial impact of granting reservists unlimited commissary access; and (12) key elements of such a study would be to: (a) establish baseline data by determining the current level of reservist patronage of the commissary system; (b) correlate commissary locations in the United States with reservist population concentrations to identify locations with the potential to experience increased patronage; and (c) estimate the effects of increased commissary sales/workloads on operating costs and the level of appropriated fund support needed.