President Releases Fed Employee Pay Plan and Locality Pay Rates for 2016

By on November 30, 2015 in Pay & Benefits with 386 Comments

Image of Barack Obama pointing at a journalist at a news conference

This afternoon, President Barack Obama released the alternative pay plan for 2016. No doubt, this will be of considerable interest to the large number of federal employees in new and existing locality pay areas as well as to those in the “rest of the U.S.” (Check out this link to the FedSmith 2016 GS Pay Calculator reflecting the estimated 2016 pay rates, including those in the 13 new locality pay areas.)

The president’s complete message is attached to this article and available below.

According to the president: “Under current law, locality pay increases averaging 28.74 percent and costing $26 billion would go into effect in January 2016. Federal agency budgets cannot sustain such increases.”

The net result is: “[L]ocality-based comparability payments for the locality pay areas established by the President’s Pay Agent, in the amounts set forth in the attached table, shall become effective on the first day of the first applicable pay period beginning on or after January 1, 2016.”

On August 28, 2015, the president issued a letter which read, in part: “I am transmitting an alternative plan for pay increases for civilian Federal employees covered by the General Schedule and certain other pay systems in January 2016….Specifically, I have determined that for 2016, across-the-board pay increases will be 1.0 percent.”

In his latest message, he wrote: “These (locality pay) rates are based on an allocation of 0.3 percent of payroll as indicated in my August 28, 2015, alternative pay plan for adjustments to the base General Schedule. These decisions will not materially affect our ability to attract and retain a well-qualified Federal workforce.”

The complete table of locality based pay for all regions is included below.

As expected, the average federal employee pay raise will be about 1.3%. The new base pay rates have not been issued by the Office of Personnel Management (OPM). Some locality pay areas will be receiving a smaller pay raise than they might have otherwise for reasons explained in this article. (See About 102,000 Feds to Get Pay Raise in New and Expanded Locality Pay Areas)

This table shows the locality rate or the Target Pay Gap established by the Federal Salary Council for the 13 new locality pay areas. Hopefully, no one was expecting a raise of 30% or more. The column on the right shows the actual 2016 Locality Pay Rate that has been approved for 2016.

Locality Area Locality Rate (Target Pay Gap) 2016 Locality Pay Rate
Albany- Schenectady, NY 46.02% 14.49%
Albuquerque-Santa Fe-Las Vegas, NM  34.51% 14.37%
Austin-Round Rock, TX  47.47% 14.51%
Charlotte-Concord, NC–SC  41% 14.44%
Colorado Springs, CO  48.20% 14.52%
Davenport- Moline, IA–IL  40.14% 14.43%
Harrisburg-York- Lebanon, PA  43.76% 14.47%
Laredo, TX  54.74% 14.59%
Kansas City- Overland Park-Kansas City, MO–KS  11.88% 14.49%
Las Vegas-Henderson, NV–AZ  51.39% 14.55%
Palm Bay- Melbourne-Titusville, FL  38.89% 14.42%
St. Louis-St. Charles-Farmington, MO–IL  45.23% 14.49%
Tucson-Nogales, AZ  47.47% 14.51%
Rest of the U.S. 14.35%

 

Here is the complete list of all locality pay areas in the U.S. for 2016.

Locality Pay Area Locality Payment
Alaska 25.16%
Albany-Schenectady, NY 14.49%
Albuquerque-Santa Fe-Las Vegas, NM 14.37%
Atlanta—Athens-Clarke County—Sandy Springs, GA-AL 19.58%
Austin-Round Rock, TX 14.51%
Boston-Worcester-Providence, MA-RI-NH-CT-ME 25.19%
Buffalo-Cheektowaga, NY 17.31%
Charlotte-Concord, NC-SC 14.44%
Chicago-Naperville, IL-IN-WI 25.44%
Cincinnati-Wilmington-Maysville, OH-KY-IN 18.76%
Cleveland-Akron-Canton, OH 18.87%
Colorado Springs, CO 14.52%
Columbus-Marion-Zanesville, OH 17.41%
Dallas-Fort Worth, TX-OK 21.04%
Davenport-Moline, IA-IL 14.43%
Dayton-Springfield-Sidney, OH 16.50%
Denver-Aurora, CO 22.93%
Detroit-Warren-Ann Arbor, MI 24.40%
Harrisburg-Lebanon, PA 14.47%
Hartford-West Hartford, CT-MA 26.20%
Hawaii 16.81%
Houston-The Woodlands, TX 29.11%
Huntsville-Decatur-Albertville, AL 16.37%
Indianapolis-Carmel-Muncie, IN 14.92%
Kansas City-Overland Park-Kansas City, MO-KS 14.49%
Laredo, TX 14.59%
Las Vegas-Henderson, NV-AZ 14.55%
Los Angeles-Long Beach, CA 27.65%
Miami-Fort Lauderdale-Port St. Lucie, FL 21.05%
Milwaukee-Racine-Waukesha, WI 18.39%
Minneapolis-St. Paul, MN-WI 21.30%
New York-Newark, NY-NJ-CT-PA 29.20%
Palm Bay-Melbourne-Titusville, FL 14.42%
Philadelphia-Reading-Camden, PA-NJ-DE-MD 22.22%
Phoenix-Mesa-Scottsdale, AZ 17.12%
Pittsburgh-New Castle-Weirton, PA-OH-WV 16.68%
Portland-Vancouver-Salem, OR-WA 20.69%
Raleigh-Durham-Chapel Hill, NC 17.94%
Richmond, VA 16.76%
Sacramento-Roseville, CA-NV 22.61%
San Diego-Carlsbad, CA 24.73%
San Jose-San Francisco-Oakland, CA 35.75%
Seattle-Tacoma, WA 22.26%
St. Louis-St. Charles-Farmington, MO-IL 14.49%
Tucson-Nogales, AZ 14.51%
Washington-Baltimore-Arlington, DC-MD-VA-WV-PA 24.78%
Rest of U.S. 14.35%

For 2016, the highest locality pay rate in the U.S. will be the San Jose-San Francisco-Oakland, CA area with a locality pay rate of 35.75%. In 2015, the locality pay in this area was 35.15%.

We do not yet have the actual pay rates for each grade, step and locality. As soon as this information becomes available, we will update the FedSmith GS pay calculator and advise our readers that it is available.

Presidents Alternate Pay Plan for 2016

© 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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