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Updated December 20, 2021
Federal Locality-Based Comparability Payments for General
Schedule Employees
The Federal Employees Pay Comparability Act of 1990
Table 1. Federal Locality Pay Areas
(FEPCA) authorizes locality-based comparability payments
As of January 2021
for General Schedule (GS) employees. (See 5 U.S.C.
Alaska
Indianapolis-Carmel-Muncie, IN
§§5304, 5304a.) Locality pay implementation and
Albany-Schenectady, NY-MA
Kansas City-Overland Park-Kansas
adjustment procedures are specified in the statute and
City, MO-KS
Office of Personnel Management (OPM) regulations. (See 5
Albuquerque-Santa Fe-Las Vegas,
Laredo, TX
C.F.R. Part 531, Subpart F.)
NM
Atlanta - Athens-Clarke County - Las Vegas-Henderson, NV-AZ
The locality pay procedures provide that payments are to be
Sandy Springs, GA-AL
made within each locality determined to have a
Austin-Round Rock, TX
Los Angeles-Long Beach, CA
nonfederal/federal pay disparity greater than 5%. Bureau of
Birmingham-Hoover-Talladega, AL Miami-Fort Lauderdale-Port St. Lucie,
Labor Statistics (BLS) surveys compare the rates of GS pay
FL
with the rates of pay generally paid to nonfederal workers
Boston-Worcester-Providence,
Milwaukee-Racine-Waukesha, WI
for the same levels of work within each pay locality. The
MA-RI-NH-ME
amount of the comparability payment payable within any
Buffalo-Cheektowaga, NY
Minneapolis-St. Paul, MN-WI
particular locality is stated as a single percentage, which is
Burlington-South Burlington, VT
New York-Newark, NY-NJ-CT-PA
uniformly applicable to GS positions within the locality.
Charlotte-Concord, NC-SC
Omaha-Council Bluffs-Fremont, NE-
The payments are effective as of the first day of the first
IA
applicable pay period commencing on or after such date as
Chicago-Naperville, IL-IN-WI
Palm Bay-Melbourne-Titusville, FL
the President designates. Locality payments are not based
Cincinnati-Wilmington-Maysville,
Philadelphia-Reading-Camden, PA-
on indicators of the cost of living in a pay area.
OH-KY-IN
NJ-DE-MD
Cleveland-Akron-Canton, OH
Phoenix-Mesa-Scottsdale, AZ
Table 1 lists the 54 locality pay areas as of January 2021.
Colorado Springs, CO
Pittsburgh-New Castle-Weirton, PA-
OH-WV
FEPCA also authorizes the President to establish an
Columbus-Marion-Zanesville, OH Portland-Vancouver-Salem, OR-WA
alternative level of locality payments if, because of a
Corpus Christi-Kingsville-Alice, TX Raleigh-Durham-Chapel Hill, NC
national emergency or serious economic conditions
Dallas-Fort Worth, TX-OK
Richmond, VA
affecting the general welfare, the President considers the
Davenport-Moline, IA-IL
Sacramento-Roseville, CA-NV
level that would otherwise be payable inappropriate.
Dayton-Springfield-Sidney, OH
San Antonio-New Braunfels-Pearsall,
Locality payments became effective in January 1994 and an
TX
average 3.95% adjustment was provided, as the law
Denver-Aurora, CO
San Diego-Carlsbad, CA
required, for that year. For each year since then, alternative
Des Moines-Ames-West Des
San Jose-San Francisco-Oakland, CA
plans have reduced the locality pay amount provided.
Moines, IA
Detroit-Warren-Ann Arbor, MI
Seattle-Tacoma, WA
Base pay and locality pay combined cannot exceed the pay
Harrisburg-Lebanon, PA
St. Louis-St. Charles-Farmington,
rate for Level IV of the Executive Schedule, which is
MO-IL
$172,500, as of January 2021 (5 U.S.C. §5304(g)(1)). As
Hartford-West Hartford, CT-MA Tucson-Nogales, AZ
annual adjustments to base and locality are provided and
Hawaii
Virginia Beach-Norfolk, VA-NC
this limitation prevents raises from taking effect at the top
Houston-The Woodlands, TX
Washington-Baltimore-Arlington,
of the scale—“pay compression”—employees paid at an
DC-MD-VA-WV-PA
increasing number of GS step levels have reached this cap.
Huntsville-Decatur-Albertville, AL Rest of U.S. (RUS)
As a result of the January 2021 pay adjustments, employees
Source: 5 C.F.R. §531.603. RUS consists of those portions of the
in the middle to upper steps of the GS-15 pay grade are
United States and its territories and possessions not located within
affected by the pay cap in 25 locality pay areas. The most
another locality pay area.
severe compression is occurring in the San Jose-San
Francisco-Oakland locality pay area, where employees at
modification of pay localities, the coverage of the surveys
GS-15 steps 5 through 10 all receive the same rate of pay.
of pay localities conducted by the BLS, the process of
comparing the GS and nonfederal rates of pay, and the level
Under FEPCA, the Federal Salary Council (FSC) provides
of comparability payments that should be paid in an annual
views and recommendations on the establishment or
memorandum to the President’s Pay Agent (which
comprises the Secretary of Labor, U.S. Office of
Management and Budget director, and OPM director). Nine
https://crsreports.congress.gov
Federal Locality-Based Comparability Payments for General Schedule Employees
members comprise the FSC, of whom three members are
A location has an opportunity to present data and
chosen from among persons generally recognized for their
information to the FSC related to the locality pay
impartiality, knowledge, and experience in the field of labor
circumstances in that location at the FSC’s annual meeting
relations and pay policy, and six represent employee
in Washington, DC. The data and information generally
organizations whose membership includes substantial
relate to the number of GS employees impacted, recruiting
numbers of employees holding GS positions. The latter
and retention difficulties in the location, and employee
members are selected giving due consideration to such
commuting patterns outside of the location to a larger
factors as the relative numbers of employees represented by
locality pay area.
the various organizations. Not more than three members of
the FSC at any one time can be from a single employee
OPM does not hold membership on the FSC but provides
organization, council, federation, alliance, association, or
administrative and technical staff support. Individuals or
affiliation of employee organizations (5 U.S.C.
groups concerned about the geographic boundaries of
§5304(e)(1)). The FSC’s most recent memorandum covered
locality pay areas or the criteria by which those boundaries
locality pay for January 2022. The Biden Administration
are established for a particular location may submit a
has yet to reconstitute the FSC and name a chair.
proposal to the FSC. Such a proposal could cover the
location of concern regardless of whether it meets the
As part of its responsibilities, the FSC may recommend that
current criteria. Individuals or groups interested in
a new locality pay area be established or that a location
providing input to the FSC can send an email message to
become an “area of application”—that is, be included in an
Pay-Leave-Policy@opm.gov with “Federal Salary Council”
already existing locality pay area. The current criteria for
in the subject line. OPM can provide individuals with
adding adjacent core-based statistical areas (CBSAs—
current information on procedures for providing testimony
metropolitan and micropolitan statistical areas) or single
to the FSC and on other matters related to locality pay.
counties to locality pay areas as areas of application are as
follows:
The Pay Agent makes recommendations on locality
payments in an annual report to the President. The most
A multi-county CBSA adjacent to a basic locality pay
recent report covered locality pay for 2022 and stated, “Any
area must have 1,500 or more GS employees and an
Council recommendations to change or make exceptions to
employment interchange rate of at least 7.5%. The
the criteria by which basic locality pay areas and areas of
“employment interchange rate” is a measure of workers
application … are established should discuss and quantify
commuting between an existing locality pay area and
the implications that such changes or exceptions could have
the proposed area of application. The rate is calculated
on all potentially impacted locations throughout the
by including all workers in assessed locations, not just
Country before the Pay Agent would consider them. Further
federal employees.
deliberation on these important matters is warranted by the
new Council, once constituted.”
A single county that is not part of a multi-county, non-
micropolitan CBSA and is adjacent to a basic locality
In November 2021, the Government Accountability Office
pay area must have 400 or more GS employees and an
(GAO) published a report on the administration and
employment interchange rate of at least 7.5%.
implementation of the GS locality pay program. It
discussed the five options for alternatives to the locality pay
Some federal facilities cross locality pay area
survey methodology that were included in the FSC’s May
boundaries. The FSC criteria stipulate that, for such a
2019 memorandum to the Pay Agent: (1) maintain the
facility “[t]o be included in an adjacent locality pay
status quo—continue use of the NCS/OEWS model; (2)
area, the whole facility must have at least 500 GS
modify the existing salary survey methodology; (3) verify
employees, with the majority of those employees in the
the results of the methodology; (4) assess the total
higher-paying locality pay area, or that portion of a
compensation gap; and (5) establish a commission to
[f]ederal facility outside of a higher-paying locality pay
periodically review federal civilian compensation. GAO
area must have at least 750 GS employees, the duty
noted, “As of August 2021, the council continues to use the
stations of the majority of those employees must be
current NCS/OEWS methodology.”
within 10 miles of the separate locality pay area, and a
significant number of those employees must commute to
The GAO report also restated the Pay Agent’s views that “it
work from the higher paying locality pay area.”
has found that important labor market factors are not
considered and the overall scale of the pay disparities
With regard to revisions in the criteria for new locality pay
presented by the council each year using the current locality
areas, the FSC’s memorandum included a recommendation
pay methodology lacks credibility; and it believed there is a
that the FSC “continue to analyze and discuss the issue of
need for fundamental legislative reforms of the federal
whether the 2,500 GS employment threshold should change
compensation system to develop a system that is
for evaluating Rest of US metropolitan areas for possible
performance sensitive and makes the government more
establishment as new locality pay areas based on pay
citizen centered, results oriented, and market based.”
disparities calculated using data from the NCS [National
Compensation Survey]/OES [Occupational Employment
Barbara L. Schwemle, Analyst in American National
Statistics] Model.” The memorandum directed the FSC’s
Government
Working Group to provide it with a recommendation on
this issue in 2021.
IF11998
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Federal Locality-Based Comparability Payments for General Schedule Employees
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https://crsreports.congress.gov | IF11998 · VERSION 2 · UPDATED