Federal Employee Locality Pay Update: Holding Off Burlington and Virginia Beach

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By on December 7, 2016 in Pay & Benefits with 0 Comments

Virginia Beach pinned on a map of USA

Readers have been writing in asking about the status of adding two new locality pay areas next year. The two areas that were recommended by the Federal Salary Council were Burlington, Vermont and Virginia Beach, Virginia. (See New Federal Employee Locality Pay Areas for 2017?)

Recently, the Salary Council recommended adding Birmingham, Alabama and San Antonio, Texas to the list of cities receiving locality pay. If accepted, locality pay rates would go into effect for these two cities in 2018.

Adding Burlington, VT and Virginia Beach, VA as Locality Pay Areas

The Salary Council has previously recommended adding Burlington, VT and Virginia Beach, VA to the list of locality pay areas for 2017. Here is what the Council recommended:

[W]e find that two additional areas, Burlington, VT, and Virginia Beach, VA, now have pay gaps averaging more than 10 percentage points above the pay gap for the ‘Rest of U.S.’ area over the 3-year period studied. We recommend that the Pay Agent establish Burlington, VT, and Virginia Beach, VA, as separate locality pay areas in 2017.

The Good and the Bad News for Federal Employees in These Areas

The good news for employees in these two areas: The Pay Agent has accepted the recommendation to add these two areas as locality pay areas. Here is the Pay Agent comments on adding the Burlington, VT and Virginia Beach, VA areas:

This Council recommendation was based on the same pay gap criterion—pay gaps using the NCS/OES data and exceeding the “Rest of U.S.” pay gap by 10 or more percentage points—used to select the 13 new locality pay areas established in 2016.

This recommendation differs from earlier recommendations to establish new locality pay areas…in that the Council’s selection of the Burlington, VT, and Virginia Beach, VA, research areas was based on pay gaps studied over a 3-year period rather than a 4-year period.

We tentatively agree that, after appropriate rulemaking, separate locality pay areas should be established for Burlington, VT, and Virginia Beach, VA. BLS should deliver data separately for the Burlington-South Burlington, VT, MSA and for the Virginia Beach-Norfolk, VA-NC, CSA, and exclude those areas from the “Rest of U.S.” computations for 2016 data deliveries to OPM staff.

The bad news is that these areas will not be added as locality pay areas for 2017. Here is the statement from the Pay Agent:

Until the regulatory process is complete to make the changes to locality pay areas we have tentatively approved above (i.e., the creation of two new locality pay areas), locality pay areas will continue to be defined as follows….

The definition of locality pay areas for 2017 does not include Burlington and Virginia Beach. The regulatory process of adding these areas will be initiated so that they will likely be included in the 2018 locality pay areas. This is also what was done in 2015 before adding new locality pay areas to be included in the 2016 pay rates.

For a list of the 2017 locality pay areas and the locality pay rates, see 2017 Locality Pay Rates for Federal Employees: San Francisco and DC Areas On Top.

What About Birmingham and San Antonio?

No mention was made by the Pay Agent of adding the cities of Birmingham and San Antonio. At the earliest, they will be added in 2018. And, as with the other cities mentioned above, they made end up getting pushed back one more year. (See Adding Birmingham and San Antonio to Locality Pay Areas)

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© 2017 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. Follow Ralph on Twitter: @RalphSmith47

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