OPM proposes adding 13 new locality pay areas

Updated 5:05 p.m. ET, June 1, 2015, with information from OPM’s proposed rule published in the Federal Register.

The Office of Personnel Management made it official Monday, as it published a proposed rule in the Federal Register saying that 13 new locality pay areas would be established.

“The Federal Salary Council recommended these 13 locality pay areas after reviewing pay levels in all ‘Rest of U.S.’ metropolitan statistical areas and combined statistical areas with 2,500 or more GS employees,” the rule said. “The Federal Salary Council found that the percentage difference between GS and non-Federal pay levels for the same levels of work — i.e., the pay disparity — in these 13 locations was substantially greater than the ‘Rest of U.S.’ pay disparity over an extended period. The President’s Pay Agent has agreed to issue proposed regulations in response to the Federal Salary Council’s recommendation to establish the 13 new locality pay areas. Locality pay rates for the new locality pay areas would be set by the President after the new locality pay areas would be established by regulation.”

Federal News Radio had previously reported about the new locality pay areas, based on what Beth Cobert, deputy director of the Office of Management and Budget, told members of the American Federation of Government Employees on May 21.

Cobert told AFGE members the increase would be based on labor market conditions at the 13 cities, according to an AFGE blogpost

The cities are: Albany, New York; Albuquerque, New Mexico; Austin, Texas; Charlotte, North Carolina; Colorado Springs, Colorado; Davenport, Iowa; Harrisburg, Pennsylvania; Kansas City, Missouri; Laredo, Texas; Las Vegas, Nevada; Palm Bay, Florida; St. Louis, Missouri.; and Tucson, Arizona.

The President’s Pay Agent made the decision to increase pay at the 13 cities based on a May 2013 Bureau of Labor Statistics report, which said employees in those cites were earning significantly less than their private- sector counterparts. The new zones were supposed to go into effect at the beginning of 2014, but the administration did not act until now.

“AFGE has been leading the fight for several years to provide federal employees in these cities with salaries that are more closely aligned with regional standards,” the blogpost said. “We are delighted that the administration has supported this initiative and come through with its commitment to have the new localities in place starting next year. Federal employees nationwide have suffered terribly from pay freezes and below-market salaries. This is tremendous news and will help so many middle class families pay their bills.”

In 2014, Federal Salary Council recommended the addition of the 13 new locality pay areas through regulation to address pay gaps in the 13 communities, beginning in 2016.

“The Administration is committed to ensuring the federal government remains competitive in attracting and retaining the Nation’s best and brightest individuals for public service. That is why, after years of pay freezes, furloughs, and sequestration, the President’s last three budgets have proposed modest pay increases for federal workers to help attract and retain the best talent while maintaining efforts to keep our Nation on a sustainable fiscal course. That is also why the Administration is evaluating options to address the recommendations of the Federal Salary Council to establish 13 new locality pay areas to address pay gaps between Federal and non-Federal pay levels in certain cities across America,” an OMB official aid.

The Office of Personnel Management submitted its rulemaking proposal on May 5, to the Office of Information and Regulatory Affairs, according to an OMB official.

The public has 30 days to comment on OPM’s proposed rule.

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