Basic allowance for housing: study to evaluate alternative rate calculation

(a) Authority (1) In general Not later than September 30, 2026, the Secretary of Defense shall seek to enter into an agreement with a covered entity to conduct a study in which the covered entity shall calculate, using industry-standard machine learning and an artificial intelligence algorithm, proposed monthly rates of BAH described in subsection (b) for MHAs selected under subsection (c). (2) Rule of construction During such a study, the Secretary shall pay BAH in MHAs selected under subsection (c) at rates prescribed under section 403 of title 37, United States Code. (b) Proposed monthly rates A proposed monthly rate of BAH described in this subsection— (1) accurately reflects housing prices in the MHA subject to such rate; and (2) is sufficient for military families who reside in such MHA to procure adequate and affordable housing. (c) MHAs The Secretary shall select not fewer than 15 MHAs to participate in such a study. To select an MHA, the Secretary shall consider factors including the following: (1) Variety of geographic location. (2) The ranks of members who reside in an MHA. (3) Whether members who reside in an MHA have dependents. (4) Economic factors including inflation, cost of living, and the cost of private mortgage insurance. (d) Termination A study under this section shall terminate on the day that is three years after the date on which the Secretary enters into an agreement with a covered entity. (e) Annual briefings Not later than 180 days after the date of the enactment of this Act, and on an annual basis thereafter through the termination date under subsection (d), the Secretary shall provide to the Committees on Armed Services of the Senate and the House of Representatives a briefing on the status of a study under this section. (f) Report Not later than 120 days after the date of the termination of such a study, the Secretary shall submit to the Committees on Armed Services of the Senate and House of Representatives a report regarding such study. Such report shall include the following elements: (1) An evaluation by the Secretary of the proposed monthly rates of BAH calculated by a covered entity pursuant to an agreement under subsection (a). (2) Any recommendation of the Secretary regarding legislation to improve the calculation of BAH process based on the study. (g) Definitions In this section: (1) The term BAH means the basic allowance for housing for members of the uniformed services under section 403 of title 37, United States Code. (2) The term covered entity means a nationally recognized entity in the field of single-family housing that has data on local rental rates in real estate markets across the United States. (3) The term MHA means military housing area.