item; if you have used all of your Group B entitlements, you can receive any amount of flour that you can use if it is available). In addition, we receive bonus items: cheese, butter, nonfat dry milk and honey. Bonus items are not provided on a per meal basis; we are authorized as much as we can use if it is available. This year there were' caps placed on some of the bonus items because of shortages. AAFES uses all of the entitlement money and requests as much of the bonus commodities as they can use in the school lunch program. They also have received rebates on donut mix through the National Commodity Processing Program for mix bought from a supplier. The total value of Group A, B, and Bonus commodities received this year is approximately $2 million. In addition, AAFES receives cash payments from the USDA. The payments are $0.14 for every meal served, plus $0.9214 for every reduced price meal and $1.3225 for every free meal. As of the end of March, 84 percent of the meals served were full price, 9 percent were reduced price, 7 percent were free and AAFES had received $1,463,000 in cash payments from the USDA. The lunch is eligible for the same level of commodity support as U.S. schools and is receiving the same level as far as we can determine. However, we do not have specific information available on exactly how much support individual school systems receive.

The Department of Defense is aware that, in addition to the USDA commodity and cash subsidies, school districts within the United States receive state-provided subsidies. We have been looking at alternative ways to absorb the difference between the costs of preparation, after taking into account the USDA subsidies, and the average rate charged by schools in the U.S. We are working with the OMB to determine which alternative to pursue.

Question: We noted that a child care center opened to support the Pentagon using private funds for construction and operation. Would you please describe this concept and tell us about any plans to expand it to other areas of the Armed Forces?

Ms. Pope: 10 USC Section 2809 is a test of long-term facilities contracts which permits the Department of Defense (DoD) to award contracts for the construction, management, and operation of several types of facilities, including child care, on or near a military installation. The 2809 is a Service contract and can be written for terms of up to 32 years. One provision of 10 USC Section 2809 is that it must be cost-effective when compared with other means of acquiring the facility. The 2809 contracts have the advantage of being quick. Child care services can be built and operated within one year from the date of award. Using this authority, DoD has successfully contracted out for two child development centers: - Pentagon.

- Tracy Depot, California.

DoD is actively encouraging each of the Services to look at one or two pilot projects.

Mr. HUTTO. Before we will call up our next panel, we are going to have a 5-minute vote here apparently. A quorum call.

We will call up the next panel and then we will recess for about 15 minutes until we go vote.

The next panel will be Sgt. Maj. Julius W. Gates, Department of the Army; Master Chief Machinist's Mate Lewis M. Sikes, Jr., Fleet Master Chief, U. S. Atlantic Fleet, Department of the Navy; a Chief Master Sgt. James C. Binnicker, Department of the Air Force; and Sgt. Maj. David W. Sommers, the U.S. Marine Corps. We appreciate very much you gentlemen coming and are sorry to delay you, but we will go vote and then we will be back.

The subcommittee stands in recess for about 15 minutes.

[Whereupon, at 3:25 p.m., the subcommittee recessed for a roll call vote.]

Mr. HUTTO. We will resume our sitting.

We are very pleased to have the panel of enlisted personnel from the Army, Navy, Air Force and Marines.

Gentlemen, we will let you proceed as you see fit. We are looking forward to hearing from you.

Do you have statements?

STATEMENT OF CHIEF MASTER SGT. OF THE AIR FORCE JAMES C. BINNICKER, UNITED STATES AIR FORCE

Chief Master Sergeant BINNICKER. Yes. Mr. Chairman, I do not have an opening statement. I would confine my remarks to thanking the committee for its support in the past for our quality of life and MWR programs, and seek your continued support of those very valuable programs, and I welcome any questions that the panel may have.

Mr. HUTTO. All right. Thank you, Chief Master Sergeant Binnicker.

PREPARED STATEMENT OF CHIEF MASTER SERGEANT JAMES C. BINNICKER

Mr. Chairman and Members of the Committee, I appreciate the opportunity to appear before you today to discuss the most pressing issues facing the enlisted members of the Air Force. Let me start by thanking you for your past support for people programs. They have allowed us to build the best Air Force in the history of this country, and, to my mind, the world.

The enlisted men and women of the Air Force are top quality and they are ready to do their job of defending this nation. They are committed to readiness and training and their enthusiasm is boundless. As I travel, they continually impress me with their dedication, patriotism, loyalty and desire to do the absolute best they can.

The Air Force is committed to maintaining this level of quality.

We strive to recruit the best, and then we train them to be prepared. However, to retain them we must have a compensation and benefits package which recognizes their

mission.

It must not only compensate them equitably and fairly, but must also provide for their families and their future.

Our members are well aware of the problems this country faces because of the deficit and they have accepted the budget cuts over the past several years as necessary. However, as a result of conversations with the troops over the past three months, I believe we may have turned down the same road we did over a decade ago. The tones and questions are beginning to sound the same as those I heard in 1977 and 1978.

In 1979, a combination of economic factors, successive military pay caps, and expanded private sector job opportunities drove many of our most talented and experienced noncommissioned officers out of the service. Similar conditions are appearing today. Despite good overall retention, shortages do exist, particularly in our high-tech and sortie-generating skills. Members with these skills are being offered lucrative opportunities with commercial companies. We must remember that low retention results in lower experience and increased training and replacement costs. Therefore, we must emphasize retention as we evaluate priorities within the budget.

What is it that our people want? They want a standard of living that is commensurate with the mission they perform and equal to the nation they defend. They want a predictable, dependable, and equitable compensation and benefits package.

THE MAJOR ISSUES PLAGUING THE ENLISTED FORCE TODAY ARE:

Our members know their pay has not kept pace with either their civilian counterpe ' or inflation. The comparability gap stands at 10.1%, and pay lags inflation by 1.2%.

These numbers

Our

are bad enough; however, they point to a larger problem--the unpredictability of the current pay raise mechanism. members deserve and want a system upon which they can depend for fair and competitive raises and which will, at a minimum,

preserve their standard of living.

A recent survey revealed that retention impacts may soon be felt because of the lag in pay. Over 60% of members surveyed believed higher-paying jobs are readily available in the private sector. With a 1988 unemployment rate of 5.5%, they may be right. Also, over 70% believed private sector pay and benefits are generally better than military compensation.