New Locality Pay Areas? Not in 2015

By on December 20, 2014 in Current Events, Pay & Benefits with 5 Comments

A number of readers in some metropolitan areas around the country have been wondering: “Will I receive new locality pay rates in 2015?” From notes we have received from a number of readers, some federal employees in the metropolitan areas which the Federal Salary Council has recognized were hoping for a substantial pay increase.

Their curiosity is understandable. The Federal Salary Council recommended establishing new locality pay areas back in 2012 for the following areas and included relevant pay data at that time:

Area March 2012 GS Base Payroll Pay Gap Recommended locality rate (target pay gap)
Albany $166,730,596 55.34% 47.94%
Albuquerque $510,495,966 45.88% 38.93%
Austin $366,557,509 51.17% 43.97%
Charlotte $168,635,266 47.85% 40.81%
Colorado Springs $561,339,429 52.99% 45.70%
Davenport $266,360,779 46.44% 39.47%
Harrisburg $413,576,464 52.18% 44.93%
Laredo $169,685,744 64.25% 56.43%
Las Vegas $275,731,172 60.41% 52.77%
Palm Bay $309,775,047 48.75% 41.67%
St. Louis $783,335,734 52.34% 45.09%
Tucson $491,018,021 50.52% 43.35%
Subtotal $4,483,241,727 51.67%  
Rest of U.S. $34,307,554,189 40.13% 33.46%
Adjusted RUS $29,824,312,462 38.40% 31.81%

But, despite the optimism of many, apparently including the Federal Salary Council, new locality pay areas have not been established. A report from the Federal Salary Council dated in November 2014 reads, in part:

“We realize that the President’s issuance of alternative pay plans for 2014 and 2015, which hold locality pay percentages at 2013 levels, may have been a factor in the Pay Agent not yet taking action to establish the 12 new locality pay areas. Even if locality pay levels for the recommended 12 new locality pay areas must remain at “Rest of U.S.” levels until increases to locality pay percentages are approved in the future, we believe it is best to establish the 12 new locality pay areas as soon as possible. This will ensure that locality pay reflecting NCS/OES model results can be implemented without delay once higher locality pay percentages are approved.”

The Federal Salary Council is also now recommending that Kansas City be included as a new locality pay area.

One reason  that new locality pay areas have not been established as recommended by the Salary Council is the alternative pay plan issued by President Obama earlier this year. In his letter, the president stated:

Specifically, I have determined that for 2015, across-the-board pay increases will be 1.0 percent, and the current locality pay percentages shown in Schedule 9 of Executive Order 13655 of December 23, 2013, will remain at their 2014 levels. This decision will not materially affect our ability to attract and retain a well-qualified Federal workforce. (See Obama Calls on Feds to Do Their “Fair Share” With 1% Pay Raise for 2015)

A memo on behalf of the President’s Pay Agent dated November 24, 2015 has also surfaced which notes that “Under the President’s alternative pay plan for 2015, locality pay percentages will continue at the same rates that were in effect since 2010 for the Governmentwide categories…with no further action required by any agency.” It also reads: “This memorandum continues locality payments in 2015 for the same Governmentwide and single-agency categories of employees who are authorized to receive 2014 locality payments….”

The 2015 General Schedule pay calculator, including the locality pay differential for each area, is now available at FedsDataCenter.com.

Federal Salary Council Recommendations: Nov. 2014

© 2016 Ralph R. Smith. All rights reserved. This article may not be reproduced without express written consent from Ralph R. Smith.

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About the Author

Ralph Smith has several decades of experience working with federal human resources issues. He has written extensively on a full range of human resources topics in books and newsletters and is a co-founder of two companies and several newsletters on federal human resources.

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