New General Schedule (GS) Locality Pay Areas
Late last year, the President’s Pay Agent issued a GS locality pay report and approved recommendations for 2024 GS locality pay that will add about 32,000 more federal employees into the locality pay system.
The Pay Agent’s report included a decision to add these areas into the federal government’s locality pay system:
- Fresno, California
- Reno, Nevada
- Rochester, New York
- Spokane, Washington
The Pay Agent also decided to add Emporia City, Virginia, into the Richmond locality pay area: “We agree with the Council that Emporia city, VA—a U.S. county equivalent surrounded geographically by Greensville County, VA—would be completely surrounded by Richmond, VA, locality pay if Greensville County is added to the Richmond locality pay area as the Council Recommends.”
Adding New Federal Employees into the Boston, Detroit, and Seattle Locality Pay Areas
The Federal Salary Council recommended adding several areas into the Boston, Detroit, and Seattle GS Locality Pay Areas. The Pay Agent has “tentatively agreed” to these changes because “they are similar to locations completely bordered by land that is included in higher-paying locality pay areas”:
- Dukes and Nantucket Counties, MA, which would be included in the Boston locality pay area as areas of application;
- Huron County, MI, which would be included in the Detroit locality pay area as an area of application; and
- Pacific and San Juan Counties, WA, which would be included in the Seattle locality pay area as areas of application.
New Federal Salary Council Report Pushes Pay Agent and OPM to Start Implementing Changes
The Federal Salary Council (FSC) is pushing to have the Pay Agent decisions made last December put into place.
In its latest report, the FSC wrote: “The Council reiterates the recommendation it made for 2023 regarding specific Rest of US locations completely or almost completely bordered by
higher-paying locality pay areas….” “That Emporia City, VA, be included in the Richmond locality pay area…..”
The Salary Council also reiterated that the areas noted above in Massachusetts, Michigan, and Washington State have not yet been added.
Role of OPM in Locality Pay
The Federal Salary Council report is effectively urging OPM to start issuing proposed regulations to implement Salary Council recommendations that the President’s Pay Agent has already approved.
The Pay Agent’s decisions will not go into effect until OPM issues proposed regulations and then issues final regulations.
The Office of Personnel Management (OPM) director is one of three people that constitute the President’s Pay Agent. The other two people are the Office of Management and Budget director and the Secretary of Labor.
A proposed rule will be printed in the Federal Register announcing proposed changes and additions to the locality pay system. Comments are submitted, reviewed, and a final decision is issued by publication in the Federal Register. This process takes time.
While we do not know when OPM published the latest Federal Salary Council report, it was signed on February 4, 2023. Because of the time necessary to have additions made to the locality pay areas to be effective in January 2024, the regulatory process has to be initiated soon.
Dollar Value of Being Added to Locality Pay System
We anticipate that OPM has been working to finalize the proposal(s) to make additions to the locality pay system as approved by the President’s Pay Agent and that the Federal Register notices will be published shortly. When that occurs, FedSmith readers will be quickly notified as these pay changes will impact tens of thousands of federal employees in the geographic areas that will be impacted.
The actual impact of being added to a locality pay area varies by a person’s grade, the locality pay area, and the existing salary of an employee. Here is one example of how being added to the locality pay system can impact the salary of a federal employee:
From 2015-2023, the percentage difference in the increase for the Rest of the U.S. ($16,004) and the San Jose-San Francisco locality pay area ($22,569) was 53%. The percentage difference in the increase for the Washington area over the Rest of the U.S. was about 41% for this time period for a GS 12, Step 9.Value Of GS Locality Pay? In One Example, 53% Increase Over “Rest Of The U.S.”