Understanding the federal pay system and locality pay rests comfortably between difficult and impossible. Even when regularly working in this field in an agency, the differences in pay systems may render an expert in one agency lacking knowledge about how federal pay is set in other agencies.
We know that, in addition to some agencies having authority for separate systems, the locality pay system for General Schedule (GS) employees is expanding. The Federal Salary Council is pushing to significantly expand existing localities to incorporate larger geographic areas as well as adding new ones.
A listing of the locality pay areas for 2017 is below. But, before getting excited over the locality pay rates listed, this is the percentage cited by the Federal Salary Council as the differential in pay between federal and private sector. As you can see in the GS Pay Calculator, the actual locality pay differential for 2016 was considerably lower for each city listed. While we do not know the rates for 2017, the increase for next year will again be relatively small.
This article highlights proposed locality areas for 2017 as detailed by the Federal Salary Council. It includes new geographic areas they are recommending adding to the locality pay system.
Locality Pay Areas for 2017
|Locality Pay Area||Pay Gap||Locality rate (target pay gap)|
|Colorado Springs, CO||55.68%||48.27%|
|Kansas City, MO-KS||46.65%||39.67%|
|Las Vegas, NV||53.62%||46.30%|
|Los Angeles, CA||82.26%||73.58%|
|New York, NY||84.31%||75.53%|
|Palm Bay, FL||45.81%||38.87%|
|Rest of US||37.23%||30.70%|
|San Diego, CA||85.17%||76.35%|
|San Francisco, CA||101.06%||91.49%|
|St. Louis, MO||52.60%||45.33%|
|All Pay Areas||61.66%||53.96%|
For example, Lewiston, Maine is about 135 miles from Boston, Massachusetts and, according to MapQuest, driving to Boston is about two hours and twenty minutes. Boston is a locality pay area with a “pay bump” of 25.19%.
Other than being in New England, what does Lewiston have to do with Boston as far as locality pay is concerned? Here is the answer according to the Federal Salary Council: “Under the locality pay area definitions applicable in January 2016, the Portland-Lewiston-South Portland, ME, Combined Statistical Area is included in the Boston locality pay area as an area of application….”
In effect, the Salary Council is recommending expanding the number of federal employees in a variety of areas into the locality pay system. It bases these recommendations to expand federal pay based on several criteria.
For example, here are recommendations for expanding locality pay into an existing pay area to employees who may be a considerable distance away from one of these major cities.
Listed below are “metropolitan areas” that the Salary Council recommends be incorporated into an existing pay area. Check out the report of the Council for more information.
Adjacent “Rest of U.S.” Multi-County Metropolitan Areas with 7.5 Percent or Higher Commuting Rate
|Pay Area||Metropolitan Area||Employment Interchange||GS Employees|
|DAYTON||Lima-Van Wert-Celina, OH||9.79%||169|
|DETROIT||Lansing-East Lansing-Owosso, MI||10.00%||804|
|DETROIT||Saginaw-Midland-Bay City, MI||7.76%||714|
|DETROIT||Toledo-Port Clinton, OH||9.01%||717|
|HUNTSVILLE||Florence-Muscle Shoals, AL||11.49%||116|
|INDIANAPOLIS||Lafayette-West Lafayette-Frankfort, IN||8.67%||199|
|MINNEAPOLIS||Mankato-New Ulm-North Mankato, MN||12.35%||64|
|RALEIGH||Rocky Mount-Wilson-Roanoke Rapids, NC||10.58%||88|
|SAN FRANCISCO||Modesto-Merced, CA||18.91%||708|
|WASHINGTON, DC||Cumberland, MD-WV||9.95%||365|
The table above is just one of the groupings of potential new employees into the locality pay system.
Adjacent “Rest of U.S.” Single-County MSAs with 7.5 Percent or Higher Commuting
Here is another group of employees that may eventually benefit from locality pay using different criteria cited by the Federal Salary Council.
|Pay Area||Place Name||Employment Interchange||Number of GS Employees||Adjacent Core-Based Statistical Areas|
|MILWAUKEE||Fond du Lac Co. WI||22.92%||31||Fond du Lac, WI Metropolitan Statistical Area|
|HUNTSVILLE||Etowah Co. AL||11.01%||127||Gadsden, AL Metropolitan Statistical Area|
|DETROIT||Jackson Co. MI||21.93%||46||Jackson, MI Metropolitan Statistical Area|
|MILWAUKEE||Sheboygan Co. WI||13.62%||18||Sheboygan, WI Metropolitan Statistical Area|
An astute reader may be wondering if others are being recommended for future inclusion?
Yes, there are a number of other areas recommended for future inclusion in locality pay areas. We will cover these in a separate article.