Congress Allows Services to Restore Full Per Diem Rates for Defense Travelers

The change, included in the final fiscal 2017 Defense authorization bill, tweaks a controversial 2014 department policy related to long-term government travel.

Lawmakers have granted relief to service members and Defense civilian employees on extended government travel from a controversial 2014 department policy that reduced their per diem rates.

The individual military services would have the authority to pay the full per diem available for long-term government travel for Defense employees if they choose to, under language included in the fiscal 2017 National Defense Authorization Act. On Dec. 8, Congress sent the massive bill to President Obama who earlier had threatened to veto both the House and Senate versions of the NDAA.

The service secretaries also would have the discretion to delegate that authority down to officers at the level of lieutenant general, vice admiral or above. So, for instance, the Navy secretary could delegate authority to the head of NAVSEA to provide workers with the full per diem for long-term TDY (temporary duty). The legislation also would allow the services to waive a requirement to keep and process per diem receipts in cases where it would be costly and burdensome to do so.

The Defense secretary would not be able to override that authority under the provision.

A November 2014 Pentagon policy resulted in lower reimbursement rates for lodging, meals and other expenses for service members and civilian employees on extended TDY.  

The policy reduced the reimbursement rates by 25 percent for long-term TDY of 31 to 180 days, and by 45 percent for travel exceeding 180 days. So for long-term TDY of 31 to 180 days, the reimbursement rate is up to 75 percent of the locality rate (lodging plus meals and incidentals) for each full day during that time frame; for travel lasting more than 180 days, it drops to 55 percent of the locality rate for each full day under the policy. The governmentwide standard lodging per diem rate for fiscal 2017, which took effect on Oct. 1, 2016, is $91, a $2 increase from the previous fiscal year. Meals and incidental expenses range from $51-$74 per day. So, the Pentagon’s reimbursement rates for long-term TDY are below those figures, depending on the length of the stay.

Outgoing Sen. Kelly Ayotte, R-N.H., along with several other senators with shipyards in their states, repeatedly pushed to get a waiver from the per diem cuts for shipyard workers.

The Navy already has committed to restoring the full per diem rate for shipyard workers on long-term TDY, if the language becomes law.

Jan. 19, 2016 letter from the head of the Naval Sea Systems Command asked the Pentagon for an immediate waiver for shipyard workers from the new reduced reimbursement rates.

“This is jeopardizing the successful execution of off-station availabilities and costing the Navy more than the intended savings,” wrote Adm. William Hilarides to Anthony Kurta, the per diem, travel, and transportation allowance committee charter chair. “Reduced travel allowances have introduced inefficiencies and hardships for shipyard workers on long-term TDY.”

Hilarides cited several factors related to the reduced per diems for long-term TDY that could adversely affect the command’s mission, including “undesirable” turnover among staff because various bargaining unit agreements restrict the amount of forced travel the agency can impose on workers, and difficulty in finding adequate housing. The policy, Hilarides said, “has already had a negative impact on the naval shipyards’ ability to effectively and efficiently conduct Navy ship maintenance.”

The House version of the NDAA would have repealed the policy altogether; Congress ultimately decided to go with the Senate version and Ayotte’s language.

Congress and the Obama administration had told agencies they needed to slash travel costs, and the 2014 Pentagon policy on long-term TDY per diems was part of that savings plan. But, Republicans and Democrats on Capitol Hill, as well as several unions, believed those changes have eroded morale and caused an undue burden on government travelers. The 2014 policy is simply unrealistic, given the increased rates of rental housing and many hotels, they have argued. The movement to change the policy has had broad and diverse support, including from the International Federation of Professional & Technical Engineers, the American Federation of Government Employees, the American Hotel & Lodging Association, Marriott International, and Hilton Worldwide.