Valerie Larabee, executive director of the Utah Pride Center, praised Panetta's decision, saying, "Any move in the direction of equality is the right move."
The extension of benefits includes child care and welfare programs, travel allowances and commissary and hospital visitation privileges. Service men and women will be able to list same-sex partners as beneficiaries for their life insurance a significant step, said Larabee.
"Often parents who don't acknowledge the relationship their [adult] child has will go after those benefits," she said.
But she noted, "the two most significant changes, housing and health care, have not been addressed." Such benefits are restricted by the federal Defense of Marriage Act (DOMA), according to the DOD's memo on Monday.
Still Larabee is testament to how far the military has come.
An Air Force officer in the days of Don't Ask Don't Tell, Larabee was forced for 10 years to choose between a love life and her career.
"I didn't often have a partner during that time, because it was so scary. That's the choice I made," said the 51-year-old. "It was impossible to maintain a relationship with any kind of healthy community around you."
The fear of being outed was so great that Larabee kept largely to herself.
"While everyone sat around the water cooler talking about what they did over the weekend, I sat at my desk doing my work," she said.
Changes to base policies will apply in Utah to Hill Air Force Base. The total number of military members assigned to Hill Air Force Base is 5,500, which includes active duty and Reserve military members. The base's total personnel totals 25,500, including military, civilians, contractors and military family members.
A senior Pentagon official said the rough estimate of same-sex couples affected by the new benefits is about 18,000 5,600 active duty, 3,400 National Guard and Reserve and 8,000 retirees. Officials said that the numbers were probably high, and that there was no solid survey or assessment that could provide a more accurate total.
The repeal of the ban on gays serving openly in the military took effect in September 2011, and since then the Pentagon has been reviewing policies and procedures to see what military benefits can be opened to same sex partners without violating DOMA.
Two senior Pentagon officials explained the changes and the legal arguments behind the decisions on condition of anonymity because they were not authorized to speak publicly about the issue.
In his memo to the military services, Panetta said that housing, burials such as those at Arlington National Cemetery and some benefits related to overseas deployments "present complex legal and policy challenges" but will remain under review. A key stumbling block is DOMA, which prohibits the federal government from recognizing any marriage other than that between a man and a woman.
According to a senior legal official, the department cannot extend any benefits that, by law, are limited to "spouse" because of the DOMA restrictions.
Service members get payment allowances for off-base housing, with singles getting a specific amount and married couples getting a bit more. Same-sex couples could not legally receive the higher off-base funding that a married couple could get because of DOMA's marriage definition.
But same-sex couples are not legally prohibited from qualifying for on-base housing. Pentagon officials said that issue requires more review because there were some concerns about following the "spirit of the law" outlined in DOMA. And they said that service chiefs were concerned about fairness and the reaction of other military members, including the possibility that married couples might be bumped from a housing list by a same-sex couple.
A number of lawmakers praised the Pentagon's move, but also called for full equality, saying Congress should repeal DOMA.
"The administration is doing what it can within the constraints that are in place, but the job is not done," said Rep. Adam Smith, ranking Democrat on the House Armed Services Committee. "I look forward to continuing to work with the administration and my colleagues in Congress to achieve full equality in the military."
"We are on a slippery slope here. Why would the [Defense Department] extend benefits to same-sex partners and then deny cohabiting heterosexual couples the same benefits," said Oklahoma Sen. Jim Inhofe, ranking Republican on the Senate Armed Services Committee. "The Department of Defense is essentially creating a new class of beneficiary that will increase costs and demand for limited resources that are currently available for military families, active and reserve forces, and retirees."
Among the nearly two dozen benefits now available to same-sex partners, the identification card is likely the most important. Officials said the card will look largely the same as the service members' but will have the designation "DP" for domestic partner and will list the types of benefits it allows on the back. Spouses and dependents of service members have similar cards, but those include designations for healthcare benefits.
Other benefits now available to same-sex partners and families include family programs, travel on military aircraft when available, child care, legal assistance, and if both are in the military they would be able to request, and be considered for, duty assignments in the same area.
Panetta's decision comes as he nears the end of his tenure as Pentagon chief and on the heels of President Barack Obama's broad call for equal rights for gays during his inaugural speech.
The Supreme Court is expected to rule on the constitutionality of DOMA in June, but advocacy groups have argued that there are a number of administrative steps the Pentagon could take to treat same-sex military couples more fairly.