A chronology on the issue of homosexuals in the military: 1982 -- The Department of Defense formalizes World War II-era policies against allowing homosexuals to serve, issuing a directive that states: "Homosexuality is incompatible with military service" because it undermines discipline, good order and morale. 1989 -- Members of Congress who support lifting the ban release draft copies of two internal Pentagon reports that found that homosexuals in the military posed no security risk and in many cases, made better soldiers than heterosexuals. 1990 -- Sgt. Perry Watkins wins a 10-year court battle against the Army, which had discharged him in 1981 for homosexuality. The courts found that the Army had inducted Watkins and allowed his re-enlistment three times, knowing he was gay. Watkins eventually agrees to forgo re-entry to the Army in return for $135,000 in back pay, an honorable discharge and full retirement benefits. July 1991 -- Defense Secretary Dick Cheney, testifying before Congress, calls the anti-gay policy "a bit of an old chestnut." June 1992 -- The General Accounting Office says the Defense Department spent about $27 million between 1980 and 1990 to discharge almost 17,000 service men and women for homosexuality. Sept. 29, 1992 -- Asked during the presidential campaign whether homosexuals should be allowed to serve in the military, Bill Clinton, says, "Yes. I support repeal of the ban on gays and lesbians serving in the United States armed forces." Jan. 29, 1993 -- After the Pentagon and some members of Congress object to an outright lifting of the ban, President Clinton announces a compromise under which recruits would no longer be asked their sexual orientation. He gives Defense Secretary Les Aspin six months to study the issue and draft an executive order. May 19 -- Saying Congress won't pass an outright repeal, gay Rep. Barney Frank, D-Mass., offers a compromise under which gay service members could be open about their sexuality off base but not on base. Clinton does not say whether he supports the idea. May 27 -- Sen. Sam Nunn, D-Ga., chairman of the Senate Armed Services Committee, opposes Frank's proposal and says he might offer a version of his own. July 19 -- Clinton issues a "don't ask, don't tell, don't pursue" policy that would allow homosexuals to serve as long as they do not announce their orientation. He calls it "an honorable compromise." July 27 -- A civil liberties group launches the first legal challenge of Clinton's policy, arguing that it is unconstitutional. Aug. 27 -- A $1.3 million study, commissioned by the Pentagon, supports Clinton's view that the ban could be lifted without destroying discipline or combat-readiness. Sept. 9 -- The Senate passes legislation to discourage homosexual enlistment in the military, calling homosexuality an "unacceptable risk" to morale. Tougher than Clinton's "don't ask, don't tell" proposal, the measure would allow a future defense secretary to reinstate questioning of recruits on their sexuality. Sept. 28 -- The House passes the same policy as the Senate. Within days, Clinton signs the measure with no fanfare and little public notice. Oct. 8 -- A federal appeals court upholds a judge's order banning discrimination against gays in the military, in the case of naval Petty Officer Keith Meinhold. He was discharged in August 1992 after disclosing his homosexuality on national television. The court concluded that the Pentagon policy was not an absolute ban and would allow a homosexual to remain in the military if the person showed he or she could "live by the rules" and had no "propensity" to engage in homosexual conduct. Oct. 30 -- The Supreme Court allows the Pentagon to remove open homosexuals from active duty while it appeals the Meinhold decision. Nov. 16 -- A federal appeals court in Washington orders the Navy to give a diploma and officer's commission to Joseph Steffan. Steffan had been forced to resign from the U.S. Naval Academy in 1987, six weeks before graduation, because he told the commandant he was gay. The administration has not said whether it will appeal. Dec. 16 -- Meinhold re-enlists in the Navy. Dec. 22 -- The Pentagon outlines regulations for the armed services to enforce the new law on homosexuals.