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Federal Salary Council recommends locality pay for two cities

The federal council overseeing general schedule locality pay at the Office of Personnel Management recommended adding two new locality pay areas and changing the rules under which localities are eligible for higher locality pay.

The Federal Salary Council, made up of six union members and three political appointees, approved Des Moines, Iowa, and Imperial County, Calif., for higher locality pay beginning in January 2020.

These recommendations will be sent to the President's Pay Agent -- a body made up of the heads of the OPM, the Office of Management and Budget and the Department of Labor -- for final approval.

Representatives from four other counties -- Charleston, S.C.; Nashville, Tenn.; Bridgeport, Calif.; and Pine, Minn. -- pitched the council on approving higher locality pay in their areas, detailing shortages at Department of Veterans Affairs facilities, among other hiring and retention challenges at local federal workplaces.

Federal Salary Council Chair Ron Sanders noted these areas did not meet the criteria for locality pay; however, the council did not reach consensus about whether to recommend changing the criteria for determining locality pay moving forward.

One sticking point for the council was whether to change its methodology for its salary survey. Earlier this year, the Federal Salary Council reported , based on the calculation methodology, that feds earn nearly one-third less than their private-sector counterparts. The council's union representatives favored keeping the current methodology, while Sanders called the current system "broken" and pushed for changes that would allow for "qualitative judgment" from the council.

"It's reached the point where we need to reconsider the methodology," he said. "It's nice to say there's a 30 percent gap, but if OMB doesn't believe it, if the administration doesn't believe it, and if Congress doesn't believe it, what good does it do?"

The President's Pay Agent, which also has final say over whether to approve rule changes, has raised concerns over the methodology, noting that "fundamental reforms" to the federal pay system are needed.

Sanders added the hope is that the pay agent will receive the council recommendations by year's end, so it can submit its final decision in advance of the president's annual budget release.

As for the 2019 locality pay schedule, Mark Allen, OPM pay systems manager, said the personnel agency is on track to publish the necessary regulation in December in order to clear the localities already approved for a pay bump by January 2019.

Union members pointed to the proposed retirement cuts and pay freeze in fiscal year 2019 as additional challenges presented by the administration that underscore the importance of more localities getting pay bumps.

J. David Cox, president of the American Federation of Government Employees, argued that a pay freeze and plans to cut retirement benefits would further hamper recruiting and retaining abilities. The Senate has cleared a federal pay increase for next year, but the House has yet to approve.

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Contributors

Edward A. Zurndorfer Certified Financial Planner
Mike Causey Columnist
Tom Fox VP for Leadership and Innovation, Partnership for Public Service
Mathew B. Tully Legal Analyst

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