What is the threshold and how is it determined?
For those military members assigned to the highest cost areas in the continental US, there is a significant loss of purchasing power, and, for most members, this loss will not be balanced by a subsequent assignment to a low-cost area. In determining a threshold for CONUS COLA, essentially defining what is meant by a high-cost area, the objective is to (a) maintain the member s purchasing power over his/her career and (b) do this in the most cost-effective manner. Again, the purpose is not to maintain a member s purchasing power at any given location, but over his/her career. Consequently, not every area that has an index over 100 would receive an allowance. The 7th Quadrennial Review of Military Compensation (QRMC) had recommended a threshold of 105, which, they felt, considers career movements and career purchasing power. However, Congress mandated that the threshold should be set not lower than 108%. When setting the first COLA threshold, the Secretary of Defense s Quality of Life in
