"If they choose to rent above the median rent, then they would have some out-of-pocket costs," Fowlkes said. "Likewise, if they choose to rent below the median, they would actually have some extra cash to pocket."

BAH rates are set so that service members of equal rank and with the same dependency status have equal purchasing power to rent housing, regardless of where they are assigned. The tax-free allowance is to cover not only median rental costs locally but average utility expenses — electricity, heat and water — and renter's insurance.

Total BAH payments in 2005 will reach $12.3 billion, up $2.5 billion, or 25 percent, from 2004. An additional 90,000 members will qualify. Some of that growth, Fowlkes said, results from mobilized Reserve and National Guard members who are eligible to draw BAH while activated.

Also, he said, thousands more active-duty families are eligible for BAH this year due to housing privatization, a program to move families out of aging military units and into new or renovated private sector housing with developers agreeing to set rent equal to members' monthly BAH.

Most BAH recipients are married and receive BAH at the higher with dependents rate. A sampling shows with-dependents BAH rising in 2005 by an average $47 a month for grades E-1 through E-4, $60 a month for E-8s, $63 for O-3s and $83 for O-5s.

Hawai'i rents soared in the past year. Married junior enlisted members in Honolulu will see BAH climb by 29 percent, from $1315 a month to $1,698. Married E-8s there will see a 14 percent hike, to $2,274, and O-4s with dependents will see BAH jump to $2,252, almost 24 percent.

Those rates are double or even triple BAH in some Mainland areas. Married junior enlisted living outside Whiteman Air Force Base in Missouri, for example, will see BAH climb only by $22 a month, to $622, a 3.7 percent increase. A married E-8 there will see BAH climb by seven percent or $57 a month to reach $860. A married O-4 will receive $1,099, up 16 percent over the 2004 rate.