FORT CAMPBELL, Kentucky -- A change to how the Defense Department calculates housing rates is not only impacting those who live off base, but also those who live on base in privatized military housing.
Due to this year's 1 percent reduction in service member's base allowance for housing, all residents of privatized military housing will no longer have renters insurance included as part of their lease on military bases nationwide, according to Defense Department sources
That change will hit as soon as March 1 for some military members, according to a letter obtained by Military.com. Residents of Fort Campbell's on-base housing , run by international property company Lend Lease, were informed this week that renters insurance will no longer be provided thanks to the DoD changes.
"The Department of Defense has elected to change the structure and funding of the Basic Allowance for Housing (BAH) which is the basis for rent for your home," the letter says. "BAH no longer includes a component for renters insurance. Effective March 1, 2015, Campbell Crossing will no longer be providing renters insurance on your behalf."
Related: Privatized Housing Residents to Feel 'BAH Pinch' Too
The Defense Department last year announced that the cost of renters insurance would no longer be included in the calculation used to determine BAH rates. The average cost of renters insurance added about $20 a month to the rate before its removal, Defense Department officials said.
The Army has already issued a policy to housing companies guiding them on removing the coverage from their leases, officials said. The Defense Department is expected to mirror that policy in a similar guidance to be issued to Navy, Marine Corps and Air Force officials in the next several weeks, a DoD official said on condition of anonymity.
At Fort Campbell, residents on leases signed before January 1, 2015 will still have renters insurance included in their policy until their contract expires, a housing announcement pushed through Family Readiness Groups said. New renters and those on a month-to-month lease will lose coverage March 1.
Campbell officials are also incentivizing soldiers to sign a new, year-long lease that would not include the coverage, according to the letter. If they sign by Feb. 28, they will receive a $500 check, the letter states. Those who sign by March 15 will receive $400, and those who sign by April 1 will receive $250.
Officials with other privatized housing management companies said they are waiting on guidance from the Defense Department on how to implement any changes. For now, they said, they will continue to provide renters insurance.
"At some point we will no longer provide renters' insurance to residents; however, the date for this change has not been determined. At the appropriate time, we will provide ample written notice to current and incoming residents," Bob Lewis, executive vice president of program operations for Corvias Military Living said in a statement.
Corvias manages 15 military housing communities for the Air Force and Army, including Fort Bragg, North Carolina and Eglin Air Force Base, Florida.
"Right now, we're really in a holding pattern," said Phillip Rizzo, the vice president of operation for Lincoln Military Housing, which manages 30 military housing communities at primarily Navy and Marine Corps bases nationwide. "We haven't gotten guidance from our government partner. ... Right now we haven't canceled those policies, even though the money is removed from BAH."
-- Amy Bushatz can be reached at amy.bushatz@military.com
