Overseas Cost of Living Allowance COLA

1
OverseasCost of LivingAllowance (COLA)

• COLA Survey
• 20 April 15 May 2009
• http//175fmc.korea.army.mil/

2
AGENDA

• Overview and Formula
• History and Disconnect
• Downward Spiral
• New Survey and Eligibility
• Web site and Survey Information
• Actual Survey
• Part II. Off Base Outlets
• Part III. Sources of Supply
• MSC Reports
• Project Planning and Timeline

3
OVERVIEW FORMULA
4
COLA Intent

• Payment of COLA allows service members stationed
  in high cost areas outside the continental United
  States to maintain purchasing power so that they
  can purchase about the same goods and services
  overseas as in the United States.
• COLA is intended to help service members maintain
  the standard of living they enjoyed in the U.S.

5
COLA Formula

• The amount of COLA is based on the service
  members pay grade, years of service, number of
  command sponsored dependents, duty location, and
  exchange rate.
• Two main ingredients
• Living Pattern Survey
• Retail Price Schedule (Market Basket Survey)

6
Living Pattern Survey

• First part of the COLA Survey process.
• Used to capture the living pattern of service
  members.
• What items are purchased, as well as where and
  how.

7
Living Pattern Survey (cont)

• LPS summary based on aggregate data provides
• Relative use of military facilities
• Sources of supply
• Local (civilian) outlets and facilities
• Special arrangements/discounts for govt
  employees, if any
• Local taxation rates

8
Retail Price Schedule

• Second part of COLA Survey process.
• Records actual overseas price data for a market
  basket of 120 goods and services. (120 items x
  2 stores x 3 grades 720 prices per area)
• (720 prices x 6 areas 4320 total prices)
• Local market outlets (off base), and
• U.S. Govt facilities
• Commissary
• PX
• Class Six
• Fitness Center
• Standard items priced

9
HISTORY DISCONNECT
10
USFK COLA History

• 1997 COLA Survey did not support COLA
• USFK conducted COLA Survey in 2002.
• Data not submitted to PDTATAC
• 175th FMC took lead in 2003, 2004, 2005 and 2006
  survey
• 16 June 2003 USFK COLA authorized.
• April Conducted LPS
• early May Conducted RPS
• late May Resubmitted RPS

11
USFK COLA History (cont.)

• COLA established at benchmark
• 116 for Seoul
• AUG 03 conducted 2nd RPS
• PDC requested resubmission
• Verified by USFK IG
• Validity disputed by PDC
• No COLA increase

12
USFK COLA Disconnect

• Seoul 8th most expensive city worldwide
• Seoul COLA index aligns with Kenya
• Germany and Japan receive substantial COLA
• Per diem rates more closely reflect cost of
  living

13
USFK COLA Barriers

• Living patterns altered due to low COLA
• Perception that Korea is cheap
• Full disclosure of Survey information
• High turnover of personnel
• PDTATAC confidence in data validity

14
COLA Comparisons by locality
Schweinfurt
Stuttgart
Frankfurt
Misawa
Tokyo
Seoul
N.Y.
Rate SPC,4 yrs, w/2 dependents
Source PDTATAC, 8 DEC 03
15
COLA Index - Equivalents
Afghanistan
Kazakhstan
Thailand
Mexico
Kenya
Seoul
Osan
Locations with similar COLA indices.
Source PDTATAC, 8 DEC 03
16
TDY Comparisons (TDY- MIE)
Schweinfurt
Frankfurt
Stuttgart
Misawa
Tokyo
Seoul
N.Y.
Source www.state.gov, 8 DEC 03
17
Relative Salary Index
Garmisch
Frankfurt
Stuttgart
Sapporo
Seoul
Tokyo
N.Y.
Source www.imercer .com
18
NEW SURVEY ELIGIBILITY
19
New COLA Survey

• Media plan and command involvement aid in
  education and compliance.
• Electronic, web-based survey increases scope.
• Sample more representative of population
• Statistical significance of various segments
• Drop down windows facilitate ease and accuracy.
• Management reports ensure compliance.

20
Survey Highlights

• COLA Survey debuts on Monday, 20 Apr 09.
• All Service members encouraged to participate.
• CSP numbers used for participation goal.
• Survey Websitehttp//175fmc.korea.army.mil/
• Also accessible from AFN website.

21
Survey Eligibility

• Service members residing with family.
• Unaccompanied residing in
• senior enlisted quarters,
• bachelor officer quarters,
• off post
• Barracks remarks section only.
• 3 months or less in Korea remarks only.

22
WEB SITE INFORMATION
23
(No Transcript)
24
(No Transcript)
25
(No Transcript)
26
(No Transcript)
27
(No Transcript)
28
(No Transcript)
29
(No Transcript)
30
(No Transcript)
31
(No Transcript)
32
(No Transcript)
33
(No Transcript)
34
(No Transcript)
35
(No Transcript)
36
(No Transcript)
37
COLA SURVEY
38
(No Transcript)
39
(No Transcript)
40
(No Transcript)
41
(No Transcript)
42
PART II.OFF BASE OUTLETS
43
(No Transcript)
44
(No Transcript)
45
(No Transcript)
46
(No Transcript)
47
PART III.SOURCES OF SUPPLY
48
(No Transcript)
49
(No Transcript)
50
(No Transcript)
51
(No Transcript)
52
(No Transcript)
53
(No Transcript)
54
(No Transcript)
55
MSC PARTICIPATIONREPORTS
56
(No Transcript)
57
TIMELINE AND POINTS OF CONTACT
58
Timeline

• FEB -Team Formation and Plan Development
• MAR -LPS Construction and Publicity Campaign
• APR -Survey Execution and RPS Commencement
• MAY -Data Tabulation and Reporting

59
Installation COLA Coordinators

• Seoul CPT Blair 725-5546
• Pyongtaek CPT Weilbacher 753-8202
• Taegu/Pusan CPT Stecher 768-7575
• Chinhae ITC Rybolt 762-5495
• Osan AB MSGT Hopkins 784-6424
• Kunsan AB MSGT Wilson 782-5414
• Uijungbu CPT Kim 730-3375
• Donducheon CPT Kim 730-3375
• Other SFC Phair 725-5546