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DoD still reviewing expanded online exchange privileges

A proposal to expand online exchange shopping privileges to all honorably discharged veterans is still under review by Pentagon officials, said Defense Department spokesman Navy Lt. Cmdr. Nate Christensen.

Christensen said there is no timetable for reaching a decision, but a source familiar with the discussions said the prospects are promising, with progress being made on an agreement on profit-sharing with the Veterans Affairs Department's Veterans Canteen Service.

Last May, officials with the Army and Air Force Exchange Service submitted a formal proposal to defense officials to allow all honorably discharged veterans to shop at its online exchange store. The proposal does not extend to brick-and-mortar exchanges.

Concerns initially were raised in some quarters within DoD that expanding the online access would lead to "benefit creep" — access for veterans to brick-and-mortar exchange stores and even to other quality-of-life benefits, sources have said.

About 90 percent of honorably discharged veterans left service before qualifying for retirement, and thus are ineligible for exchange shopping privileges. Among those in this group are many veterans who have deployed multiple times to combat zones in the post-9/11 era.

The potential profits generated by this expanded customer base would help the active-duty and retired military community in several ways, officials said, both in terms of improving brick-and-mortar stores and returning more dividends to morale, welfare and recreation programs on military bases.

Such a proposal normally would be considered by the DoD Executive Resale Board and a recommendation would be provided to the assistant secretary of defense for readiness and force management, Christensen said.

The DoD General Counsel's office would review the final proposal and determine whether a change in law would be required.

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