More than half a million Defense Department and Coast Guard civilian employees with a Common Access Card will be able to shop in military exchange stores by mid-May, according to a new Department of Defense directive.
The directive extends in-store and online exchange shopping privileges to appropriated fund and non-appropriated fund civilian employees who work in the U.S., and in U.S. territories and possessions, according to the memorandum signed by Virginia Penrod, acting under secretary of defense for personnel and readiness. It was effective April 12, and within 30 days, these shoppers will be allowed in Army and Air Force Exchange Service stores, Navy Exchange stores, and Marine Corps exchanges.
According to the latest estimates available, this will bring about 575,000 new customers into military exchanges in the U.S.
The new policy also provides online exchange shopping access for others, to include retired DoD and Coast Guard civilian employees.
*Retired civilian employees of DoD and the Coast Guard won’t get in-store exchange shopping privileges, but they will get limited online shopping privileges for exchanges and for other online Category C Morale, Welfare and Recreation activities. One example of a Category C MWR program is the American Forces Travel program, an official DoD site for travel discounts on airfare, flights, hotels, car rentals, travel packages and cruises.
*Family members won’t be allowed to shop in these on-base discount department stores, or in the online stores, but the authorized shoppers can make purchases for themselves and their dependents.
*Honorably discharged military veterans will get limited online shopping privileges at Category C MWR activities; these veterans have been allowed to shop online in exchanges since that benefit was launched in 2017.
*Those extended shopping benefits for online military exchanges and online Category C activities are effective 180 days after the directive, in mid-October for all the populations: DoD and Coast Guard civilian employees, honorably discharged veterans and retired DoD and Coast Guard civilians.
*The shopping privileges for all groups exclude purchases of tobacco products, alcoholic beverage products and military uniform items.
*The civilian employees will use their Common Access Card for the benefit. According to the directive, employees who are not issued CACs can show their locally issued proof of civilian employment for exchange access, only at the location where they are employed. Otherwise, access to the stores is not linked to employees’ work assignments.
*Verification for online shopping for all the groups will be done through the Defense Manpower Data Center, and those systems, processes and records are being updated.
*The Coast Guard is ensure that its MWR organizations, exchange system and the supporting entities put procedures in place for the access; and is coordinating with DMDC for the authentication process.
DoD civilians stationed outside the U.S. have exchange shopping privileges. DoD officials have been deliberating this policy change for about three years. Last October, a DoD official said the proposal to open the exchanges to civilians was close to being approved, and that it was expected to bring about 575,000 new eligible customers into exchanges. There are about 796,000 DoD civilians in the U.S., but about 221,000 of those employees already have exchange benefits resulting from another beneficiary category such as retiree or military spouse, said Berry Patrick, who works in the DoD Office of Morale, Welfare and Recreation and Nonappropriated Fund Policy, during a virtual conference of the American Logistics Association.
There are about 7,000 Coast Guard civilians, according to a Coast Guard website. Coast Guard exchanges already allow Coast Guard civilians to shop in their exchanges. In 2019, the Department of Homeland Security, the Coast Guard’s parent organization, opened up Coast Guard exchanges to the more than 200,000 civilian employees of the department.
These new shopping privileges don’t apply to commissaries.
This policy reverses a statement by a DoD spokeswoman in January, who told Military Times “DoD is not pursuing military exchange access for DoD civilian employees at this time.”
“Access is granted for the convenience of the DoD and Coast Guard civilian employees,” the directive states. DoD civilians are on the base every day, Patrick noted in his briefing to the American Logistics Association last October.
But the expansion is also expected to help boost the military resale system and MWR programs, which have faced a number of obstacles over recent years. Based on projections of buying patterns, Patrick said, DoD officials estimate exchange sales could increase by about $287 million a year, with a potential increase of $48 million in profits going back to support the services’ MWR programs.
One indicator of the popularity of the benefit among DoD employees was the situation in March, 2020 at the beginning of the pandemic, when DoD gave base commanders temporary authority to give commissary and exchange privileges to DoD civilians and contractor employees considered mission critical. Many people misinterpreted that to mean that every DoD mission-critical civilian employee automatically got those privileges, and DoD officials were getting phone calls from those potential customers, Patrick said.
But it was up to each installation, and some commanders gave the privileges while others didn’t, for various reasons such as concern about the strains on the supply chain’s ability to provide enough products for the stores.
This is the latest of several expansions of the pool of those eligible to shop in exchanges over the last several years. In January, 2020, on-base shopping benefits at commissaries and exchanges and the use of certain MWR activities were launched for about 4.1 million veterans. The new benefits were authorized by law for all veterans with VA service-connected disability ratings; Purple Heart recipients; veterans who are former prisoners of war; and primary family caregivers of eligible veterans under the VA caregiver program.
That followed the 2017 online exchange shopping benefit offered to honorably discharged veterans, a pool of about 15 million potential shoppers.