{"id":66744,"date":"2019-03-06T22:55:31","date_gmt":"2019-03-06T22:55:31","guid":{"rendered":"https:\/\/one.sightlinemg.com\/airforcetimes\/uncategorized\/2019\/03\/06\/defense-department-pushing-ahead-to-merge-commissary-and-exchange-systems\/"},"modified":"2026-08-08T13:20:02","modified_gmt":"2026-08-08T13:20:02","slug":"defense-department-pushing-ahead-to-merge-commissary-and-exchange-systems","status":"publish","type":"post","link":"https:\/\/one.sightlinemg.com\/airforcetimes\/management\/pay-benefits\/2019\/03\/06\/defense-department-pushing-ahead-to-merge-commissary-and-exchange-systems\/","title":{"rendered":"Defense Department pushing ahead to merge commissary and exchange systems"},"content":{"rendered":"\n

Defense officials are a step closer to merging the three military exchange systems and the commissary system<\/a> into one \u201cdefense resale enterprise.\u201d<\/p>\n\n\n\n

In a memo signed March 1, Lisa Hershman, acting DoD chief management officer, approved the business case for the merger.<\/p>\n\n\n\n

The merger will require the approval of Congress and nothing is yet final. Current law requires the Defense Department to operate separate commissary and exchange systems, so that law would have to be repealed. Another law prohibits DoD from using any taxpayer dollars to implement consolidation of resale entities until Oct. 1, as lawmakers evaluate the proposal.<\/p>\n\n\n\n

In the meantime, a task force will continue with planning efforts for a consolidated organization<\/a>, stated Hershman, who is in the position that ranks third in the DoD hierarchy. The consolidation of the commissary and exchange systems also must be approved by acting deputy secretary of defense David Norquist. A source said he is expected to approve the proposal within days; a report and legislative proposals will then be sent to Congress<\/a>.<\/p>\n\n\n\n

Officials have said that the first step would be to merge the exchange systems \u2014 Army and Air Force Exchange Service (AAFES), Navy Exchange Service Command and Marine Corps Exchange. It\u2019s not clear whether officials have the authority to do that without legislation, but regardless, they can\u2019t spend taxpayer dollars on any consolidation implementation before Oct. 1.<\/p>\n\n\n\n

The draft report from the task force, which analyzed the business case for consolidation, said its analysis supports merging the above-store functions of the exchange systems entirely, along with the above-store functions of the Defense Commissary Agency, into a single organization, while keeping specific grocery functions separate.<\/p>\n\n\n\n

Hershman\u2019s memo stated she will recommend that the Marine Corps Morale, Welfare and Recreation and Warfighter and Family Services operations under the umbrella of Marine Corps Community Services, or MCCS, also be included in the consolidation because of their operational model, which includes the Marine Corps Exchange.<\/p>\n\n\n\n

Marine Corps officials have previously pushed back against proposals to put MCCS under the control of the proposed new defense agency, citing these efforts are \u201cviewed as an intrusion to Title X authorities.\u201d The MCCS organization \u201cprovides the commandant of the Marine Corps an integrated system of community services to help care [for], equip, and train our warfighters,\u201d officials said in a previous position paper.<\/p>\n\n\n\n

The costs of implementing the consolidation is estimated to be $457 million to $570 million over five years, according to the business case analysis from the defense task force, completed in November. The task force stated DoD could \u201charvest significant savings\u201d by consolidating commissary and exchange systems into one entity, and contends the benefits would \u201cfar exceed the costs.\u201d<\/p>\n\n\n\t