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Home   About   Membership   Meetings   Government Affairs   Members Only Oct. 28, 2011
Executive Briefing

President's Message

AFMC, NMFA team up in support of the resale benefits as part of the Saveourbenefit campaign:

Leadership from the Armed Forces Marketing Council capitalized on its longstanding relationship with the National Military Family Association to post this well constructed and thoughtful message on the NMFA website. The desired destination for concerned readers is the website where they can take action to engage their elected officials.

3 percent withholding update — good news:

The House just passed HR 674, to repeal the 3 percent withholding tax mandate, by a vote of 405 to 16. We are grateful for the leadership of Congressmen Wally Herger, R-Calif., and Earl Blumenauer, D-Ore., who tirelessly championed the legislation in the House. This resounding and overwhelmingly bipartisan vote is the result of the persistent and diverse efforts.

According to the rule adopted by the House, HR 674 has been combined with HR 2576, that was also recently approved by the House with bipartisan support, into one measure. HR 2576, in essence the offset, would adjust the income qualifications for purposes of determining eligibility for certain health care related programs, such as Medicaid. Just as the Administration endorsed HR 674, it has likewise endorsed HR 2576.

This means the House has approved with bipartisan support and the administration's blessing a measure to repeal the 3 percent withholding tax mandate with an offset that enjoys bipartisan support and the administration's support as well. We have great momentum, but our work is not yet done.

The ball is now squarely in the Senate's court. In the coming days, we will move forward to urge the Senate to pass the House approved legislation to repeal the 3 percent withholding tax.

Note: ALA worked with the Coalition, the House Ways and Means Committee and the HASC to emphasize the impact on the patron, the resale agencies and the industry to help move it through. We will continue to work with the Coalition, the Senate Finance Committee and the SASC to ensure passage in the Senate.

Your commissary and exchange benefits are in jeopardy

Recent activities by Congress threaten to eliminate the saving you get when you shop at the commissary. If passed, these actions could also significantly reduce the money set aside to pay for MWR (Morale, Welfare, and Recreations) activities for military families.

How could this happen? In an environment focused on reducing the deficit, law makers must cut expenses from the budget before agreeing to pay for new programs. Why does this affect the commissary? Unlike other grocery stores, the commissary does not make a profit. By law, commissaries can only charge consumers 5 percent more than the item costs to stock the shelves. This unique pricing allows military families to save more than 30 percent on their grocery bill. This works because the costs to operate the commissary is paid by a subsidy in the federal budget.
  • Earlier this year, the Senate Veterans' Affairs Committee voted to eliminate the federal subsidy for military commissaries and recommended the Department of Defense consolidate the operations of the commissaries and exchanges in order to pay for the Caring for Camp Lejeune Veterans Act of 2011 (S 277). We strongly believe these families' health care needs must be met, but we are adamantly opposed to doing so at the expense of other military families. There is still time to act. This bill still needs to be voted on by the entire Senate and then approved by the House, but it poses a very real threat.

  • Sen. Tom Coburn's, R-Okla., "Back to Black" report also calls for consolidating military commissaries and exchanges into a single, non-subsidized retail system over five years.

  • There is growing concern that the $1.3 billion subsidy to operate the commissary will be targeted by the Joint Committee on Deficit Reduction or "supercommittee" tasked to find at least $1.2 trillion in savings over the next decade.

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If this bill is passed, prices in the commissary and exchanges will go up in order to make up for the loss of federal funds. You've told us how important your commissaries and exchanges are, especially those of you who live overseas or in remote locations, and we've shared your thoughts with Congress. You can also tell Congress what you think. Share your story at

If the additional step to consolidate the behind the scenes operations of the commissaries and exchanges takes place, the $300 million earned to pay for MWR programs that support critical quality of life programs could go away. In 2006, after spending $17 million to study the issue, the Department of Defense determined that consolidation was not the answer to budget concerns. It wasn't the answer then and it is not the answer now.

For more information on the commissary benefit, we suggest you read Tom Philpott's article, "Commissary boss: Critics overlook the efficiencies". We have also provided a list of important facts on the commissary and exchange.

Important Facts:
  • Military families currently save an average of 31 percent by shopping in the commissary.
  • Military families save an average of over 20 percent by shopping in the exchanges.
  • The commissaries and exchanges pay $800 million to more than 50,000 military family members employed by them.
  • Exchanges generate $300 million in dividends which are used to support Morale, Welfare and Recreation programs for service members and military families.
  • For the $1.5 billion spent annually, commissaries and exchanges generate $5.6 billion in savings.
A key message from DoD:

Panetta tells US troops in South Korea that budget cuts won't mean benefit cuts
Read the Full Story
The Associated Press via The Washington Post
U.S. Defense Secretary Leon Panetta is assuring troops in South Korea that coming budget cuts will not mean a loss of benefits promised when they joined the military.

Defense budget:

Defense industry: 1 million jobs could be lost if supercommittee fails to act
Read the Full Story
The Washington Post, Marjorie Censer
More than 1 million defense-related jobs are at risk if Congress's debt-reduction "supercommittee" fails to reach agreement, triggering $1.2 trillion in additional cuts to government spending, an industry group recently warned.

Congress works to avert defense budget cuts
Read the Full Story
Los Angeles Times, Lisa Mascaro
Weeks after agreeing to impose mandatory spending cuts on the federal government in exchange for raising the debt ceiling, members of Congress are hard at work to overturn a key element of the deal — the threat of automatic, steep cuts in the defense budget.

Defense: Military retirement plan not 'unaffordable'
Read the Full Story
The Washington Post, Steve Vogel
A senior defense official recently told a congressional panel the military retirement system is "neither unaffordable nor spiraling out of control, as some would contend," and cautioned against proposals to replace it with a private-sector-style plan.

Defense officials downplay panel's role in revamping military retirement
Read the Full Story
Government Executive, Kellie Lunney
Defense Department officials recently sought to tamp down concern on Capitol Hill over proposals from an advisory committee to significantly alter the military's retirement system.

More from the Defense Department:

Panetta's Pentagon, without the blank check
Read the Full Story
The New York Times, Peter Baker
Now as the president's new defense secretary, Defense Secretary Leon E. Panett is charged with closing the books on multiple fronts — just last week, Col. Muammar el-Qaddafi was killed in Libya and the last American troops were ordered home from Iraq by the end of the year. But the biggest challenges ahead may be retrofitting the military for a new era of austerity and guarding Obama's national security flank heading into a turbulent election year.

Key senators back TRICARE fee
Read the Full Story
Newport News Daily Press, Tom Philpott
Sens. Carl Levin, D-Mich., chairman of the Senate Armed Services Committee, and John McCain of Arizona, its ranking Republican, endorse President Barack Obama's call to establish a $200 enrollment fee on TRICARE for Life, the prized supplement to Medicare for 2.1 million elderly military retirees, their spouses and survivors.

Defense committee hearing on cuts veers off course
Read the Full Story
NationalJournal, Kevin Baron
The author of a new industry-sponsored study arguing that the severest possible defense cuts could result in 1.6 million jobs lost probably had a lot to say. Instead, professor Stephen Fuller sat mostly in silence during a House Armed Services Committee hearing on Oct. 26, that strayed far from its focus.

Patrick B. Nixon
President, ALA

Washington Update

Lawmakers open to changes in military benefits
The Associated Press via Yahoo News    Share    Share on FacebookTwitterShare on LinkedinE-mail
The government's promise of lifetime health care for the military's men and women is suddenly a little less sacrosanct as Congress looks to slash trillion-dollar-plus deficits. Republicans and Democrats alike are signaling a willingness — unheard of at the height of two post-Sept. 11 wars in Iraq and Afghanistan — to make military retirees pay more for coverage. More

US plans to maintain size of forces in South Korea despite budget cuts
Yonhap News    Share    Share on FacebookTwitterShare on LinkedinE-mail article
The U.S. plans to maintain the current size of its forces in South Korea at about 28,500 troops despite pending cuts to defense budgets, a high-ranking government source in Seoul said Oct. 24. More

Pentagon's new power panel
Defense News    Share    Share on FacebookTwitterShare on LinkedinE-mail article
Newly minted U.S. Deputy Defense Secretary Ashton Carter has only been on the job a few weeks, but he's already shaking things up. Carter, who became Pentagon's No. 2 civilian a little more than two weeks ago, is changing how defense leaders will cut spending, reform acquisition and more. More

US defense chief heads to Asia as budget cuts loom
Reuters    Share    Share on FacebookTwitterShare on LinkedinE-mail article
Defense Secretary Leon Panetta recently left for his first trip to Asia as Pentagon chief, aiming to reassure allies that the U.S. military will keep a strong presence in the Pacific — even in an era of belt-tightening. Such assurances cannot be taken for granted. The U.S. military is facing at least $450 billion in defense spending cuts over the next decade, reductions Panetta recently told Congress would take the Pentagon "to the edge." More

Long war transforms military
The Wall Street Journal    Share    Share on FacebookTwitterShare on LinkedinE-mail article
The Iraq War had a profound effect on U.S. troops, families and the military itself, changes that altered how the U.S. fights and will complicate veterans' efforts to merge back into civilian life. The nine-year odyssey, which began as a demonstration of the power of a small, high-tech army, ended with U.S. forces transformed into a counter-insurgency outfit in which winning hearts and minds prevailed over brute force. More

Webb's letter called 'false hope' of buildup change
Pacific Daily News    Share    Share on FacebookTwitterShare on LinkedinE-mail article
A U.S. senator has urged the new secretary of defense to consider an alternative buildup plan, but Guam's delegate recently said he is just spreading "false hope" that the buildup can be changed. Delegate Madeleine Bordallo issued a statement Oct. 21, responding to Sen. Jim Webb's letter, which asked Secretary of Defense Leon Panetta to re-examine a plan to move Marines from Okinawa to Guam. More

Commissary News

USDA expects food prices to climb as much as 4.5 percent
The Wall Street Journal    Share    Share on FacebookTwitterShare on LinkedinE-mail
The U.S. government said food prices are expected to climb 3.5 to 4.5 percent in 2011, an increase of one-half of a percentage point from its prior forecast, as higher commodity costs continue to filter down to consumers. More

Hire Veterans and Military Spouses

Please communicate your jobs available for veterans and military spouses. Place notices for local or national employment opportunities in their official military base newspapers. Contact

Local, organic foods not always safer
The Associated Press via USA Today    Share    Share on FacebookTwitterShare on LinkedinE-mail article
Shoppers nervous about foodborne illnesses might turn to foods produced at smaller farms or labeled "local," "organic" or "natural" in the hopes that such products are safer. But a small outbreak of Salmonella in organic eggs from Minnesota shows no food is immune to contamination. More adds groceries to offering
Supermarket News    Share    Share on FacebookTwitterShare on LinkedinE-mail article, the Amazon-owned Internet retailer selling household essentials recently said it has begun offering more than 10,000 non-perishable food items to its selection. Items in the newly added grocery tab at include coffee and tea, snacks, cereal, pasta, baking goods and canned items. The company is offering free delivery on all orders over $39. More

Michelle Obama in Chicago urges mayors to find ways to bring grocery stores to urban areas
The Washington Post    Share    Share on FacebookTwitterShare on LinkedinE-mail article
First lady Michelle Obama recently said parents can't be expected to give their children healthy food if they don't have good options for groceries nearby. Obama, who is leading a nationwide effort to lower childhood obesity rates, spoke at a Chicago Walgreens store that had expanded to include fresh produce and grocery staples. She called it an example for other parts of the city and the country. More

'Green' reusable bags carry germs along with groceries
The Miami Herald    Share    Share on FacebookTwitterShare on LinkedinE-mail article
Reusable grocery bags may be good for the environment, but they could be making you sick. With Montgomery County, Md., set to impose a tax on disposable grocery bags that's designed to discourage their use, a new study has found that intestinal bacteria like E. coli flourish in unwashed reusable bags. The study, published in the latest issue of the International Association for Food Protection's Food Protection Trends magazine, tested 87 reusable bags obtained at random from shoppers in California and Arizona. More

Commissary Announcements

Commissary Web Posts

The following commissary items were posted to the ALA Website:

Easter 2012 Promotion Package.
Father's Day 2012 Promotion Package.
Mother's Day 2012 Promotion Package.
DP #20, Update #2.
DP #23, Update #1.

12-3, Top-To-Top Meetings.
11-116, Atch 1 (Excel), DeCAF 40-15, Oct. 25, 2011.
11-116, Atch 2, DeCAF 40-15 Instructions, Oct. 25, 2011.

Both a new DeCAF 40-15 and new DeCAF Instructions, both dated Oct. 25, 2011,
were added under Doing Business with DeCA Forms and with the NTT.
FY 2012 Sales Bands.
Commissary Customer Service Survey – 2010, filed under Doing Business with DeCA.
Adds/Changes/Deletes for Week 11-42, Corrected Copy and Week 11-43.
DeCA FY11 Million Dollar Vendors posted last week was provided by E & C News.
Guard & Reserve On-Site Sale Schedule updates.
CRV Values.

ALA Meetings

2012 Exchange Roundtable

March 7-9, 2012
Sheraton Waterside
Norfolk, Virginia

Exchange News

Coalition of companies vows to hire 25,000 veterans, spouses
Stars and Stripes    Share    Share on FacebookTwitterShare on LinkedinE-mail article
A coalition of packaged goods companies has pledged to hire 25,000 veterans and military spouses over the next two years as part of White House initiatives to aid military families. If completed, the massive hiring effort would supply one-fourth of the goal of 100,000 new veteran and military spouse jobs by 2014 set by President Barack Obama in August. More

Target will build 18 new US stores in 2012
Kantar Retail    Share    Share on FacebookTwitterShare on LinkedinE-mail article
Target's Director of Corporate Real Estate, David Marquis, announced that Target would build 18 new stores in the U.S. for 2012. Sites in San Francisco, Los Angeles, Chicago and Seattle will be CityTarget stores, the retailer's new urban format. More

McDonald's McRib sandwich returns
CNNMoney    Share    Share on FacebookTwitterShare on LinkedinE-mail article
McDonald's McRib, the BBQ-sauce-drenched sandwich with a cult following, is back — for a limited time. The boneless-pork sandwich will be available at the fast food chain's approximately 14,000 U.S. locations through Nov. 14, though there will be a few franchises that don't carry it, said Danya Proud, McDonald's spokeswoman. More

Restaurant consumers choose tap water over beverages
CSNews Foodservice Retailing    Share    Share on FacebookTwitterShare on LinkedinE-mail article
Restaurant-goers are choosing tap over taste according to new market research from The NPD Group that reveals tap water as one of the fastest-growing beverages ordered in U.S. restaurants. NPD's CREST service, which tracks consumer use of restaurants, found that tap water servings make up 8 percent of the 50 billion beverages servings ordered. More

Why don't gas prices fall when oil does?
The Wall Street Journal    Share    Share on FacebookTwitterShare on LinkedinE-mail article
Why don't gas prices drop when oil prices fall? Because all oil prices aren't created equal. More

Coca-Cola's red cans to turn white for polar bear conservation effort
Convenience Store News    Share    Share on FacebookTwitterShare on LinkedinE-mail article
Coca-Cola is ramping up its association with the World Wildlife Fund, committing up to $3 million to the WWF's polar bear conservation efforts. The beverage company is also asking fans in the United States to join the "Arctic Home" campaign by texting donations. More

Wal-Mart unveils strategy to match prices after purchases are made during the holiday season
The Washington Post    Share    Share on FacebookTwitterShare on LinkedinE-mail article
Wal-Mart announced a new strategy that it hopes will pull in procrastinators early by giving them a big incentive: A guarantee that they'll get the lowest price no matter when they buy during the holiday season. The discounter recently said it will match prices on many of its products. Shoppers who buy something at a Wal-Mart store between Nov. 1 and Dec. 25, but then find the identical product elsewhere for less, can get a gift card in the amount of the difference. More

Exchange Announcements

NEXCOM further commits to military spouse employment
U.S. Navy    Share    Share on FacebookTwitterShare on LinkedinE-mail article
Navy Exchange Service Command become one of the newest partners in the Department of Defense Military Spouse Employment Partnership, officials announced Oct. 17. Since the program launched in June with 24 partners, it has now grown to include 96 partners, all pledging support to provide career opportunities for military spouses. More

NEXCOM names new vice president of corporate contracts
Share   Share on FacebookTwitterShare on LinkedinE-mail article
The Navy Exchange Service Command has named Donna Reuss as its vice president of corporate contracts. Reuss' previous position was deputy director of contracting for NAVSUP Fleet Logistics Center in Norfolk, Va., where she managed over 230 military, civilian and contractor personnel in multiple locations who processed contracting actions valued at approximately $6 billion annually.

Reuss has over 30 years of federal contracting experience having served in a variety of assignments including senior level positions within NAVSUP Fleet Logistics Center Norfolk, Va. Her background also includes nearly five years experience in overseeing the Small Business Program at the Fleet Industrial Supply Center in Norfolk, Va. She is a member of the Tidewater Government/Industry Council.

Reuss has a Bachelor of Arts degree from Virginia Tech, is certified at the Defense Acquisition Workforce Improvement Act Level III, and is a member of the Department of Navy Acquisition Professional Community. She has been recognized twice for Meritorious Civilian Service.

Hampton Roads ALA benefit luncheon for AREA, NEREA
ALA    Share    Share on FacebookTwitterShare on LinkedinE-mail article
The Hampton Roads ALA will be hosting their 12th Annual Benefit Luncheon for AREA, NEREA and HRALA Scholarships De. 1, at the Virginia Beach Sheraton Oceanfront. Guest speakers are NEXCOM SVP and CMO Tess Paquette and AAFES SVP LG Dan Tompkins. Companies interested in sponsoring the event with a full page ad, $1000, or half page ad, $500, should contact Cory Belkov at All proceeds will be split equally between the three scholarship programs. More

Washington Update

State department commissaries/employee associations
Share   Share on FacebookTwitterShare on LinkedinE-mail article
The Secretary of State has the legislative authority to establish and operate employee associations at U.S. diplomatic missions abroad, and the staff of the Office of Commissary and Recreation Affairs supports and oversees these associations. There are approximately 135 associations, whose members are from both the civilian agencies of the USG as well as the various military units under the jurisdiction of the Chief of Mission.

The one function CR performs that may be of particular interest to wholesale suppliers is the publishing of an interactive, online supplier directory. Our directory lists those companies interested in doing business with employee associations. The directory provides links to each company's email address or website so that those using it can find what they need more quickly and more efficiently. It gives the customer a faster connection to each supplier. If a company would like to be a part of CR's supplier directory, please email or fax a short description of the products/services offered and contact information. We will add the company to the directory and send the point of contact information on how to contact the employee associations.

Those readers familiar with the commissaries, exchanges and MWR activities of the military would not find many similarities to the Department of State's employee associations. The associations tend to be much smaller, averaging under $500,000 on gross annual revenues. Many of them are located in developing countries where goods and services are either difficult to acquire, expensive, unsafe, unavailable or all of the above. Some associations offer little more than a few conveniences such as a snack bar or a video club. Others run more extensive facilities more in line with those of the military. Each association is responsible for its own procurement — there is no centralized procurement. However, CR assists associations by providing them with appropriate sources of procurement through the supplier directory and our contacts in the industry.

Although the employee associations differ from the military in size and scope there is one overriding similarity: the mission to provide high quality goods and services to support the morale and welfare of Americans serving our country abroad. To this end, CR invites any and all interested supplier to contact us by fax or email.

Note: AAFES is directly managing express stores on behalf of our employee associations in Cairo, Egypt; Tegucigalpa, Honduras and Pristina, Kosovo.
Phone: 202-663-1330
Fax: 202-663-1329

US Army may cut 22 percent of brigades
Defense News    Share    Share on FacebookTwitterShare on LinkedinE-mail article
U.S. Army leaders are planning to cut some brigade combat teams and reorganize the rest as the force shrinks by 50,000 soldiers. The reorganization details will be part of the annual Total Army Analysis, due to service leaders in December, said Maj. Gen. Anthony Ierardi, head of Force Management at Headquarters Army. More

Lawmakers open to changes in military benefits
The Associated Press via Yahoo News    Share    Share on FacebookTwitterShare on LinkedinE-mail article
The government's promise of lifetime health care for the military's men and women is suddenly a little less sacrosanct as Congress looks to slash trillion-dollar-plus deficits. Republicans and Democrats alike are signaling a willingness — unheard of at the height of two post-Sept. 11 wars in Iraq and Afghanistan — to make military retirees pay more for coverage. More

Executive Briefing
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