Law calls for 18.6 percent federal pay raise

Federal employees should get an average pay raise of 18.56 percent in 2003 under a 1990 law, a new Congressional Research Service report says.

Under the Federal Employees Pay Comparability Act of 1990, white-collar federal workers would receive a 3.1 percent across-the-board increase in January 2003, plus double-digit, locality-based increases, which are derived from city-by-city private-public salary comparisons. The average total of the across-the-board increase and locality-based raises would be 18.56 percent.

But federal employees won't be receiving double-digit raises in January.

"FEPCA has never been implemented as originally enacted," said the Feb. 21 report, "Federal Pay: FY2003 Salary Adjustments," written by Congressional Research Service analyst Barbara L. Schwemle. "Since 1995, locality payments have been much lower than FEPCA requires."

In 1990, studies concluded that federal workers were paid about 30 percent less than their private sector counterparts. In certain high-wage cities such as Los Angeles, New York and San Francisco, federal agencies reported difficulty recruiting and retaining workers. FEPCA aimed to close the gap to 5 percent between 1994 and 2002. But the Clinton and Bush administrations each year proposed smaller raises than FEPCA called for, saying the FEPCA raises would be too expensive.

For 2003, the Bush administration has proposed a 2.6 percent average federal pay raise, seven times below the total FEPCA-required raise and below even the across-the-board portion of the raise that the law calls for. At the same time, the Bush team has called for a 4.1 percent military pay raise. The military raise is also based on a statutory formula.

The double-digit, FEPCA-required locality-based increases would cost $9.8 billion in 2003, according to the President's Pay Agent, a council comprised of officials at the Office of Management and Budget, Office of Personnel Management and the Labor Department.

Members of the House and Senate, including Rep. Steny Hoyer, D-Md., and Rep. Connie Morella, R-Md., are pushing for a 4.1 percent federal civilian pay raise, noting that military and civilian personnel have received the same pay raises in 15 of the last 18 years.

In a recent letter to all members of the House, Hoyer and Rep. Tom Davis, R-Va., urged their colleagues to sign a 'sense of the Congress' resolution calling for pay parity between military and civilian employees. The resolution, H. Con. Res. 42, currently has 75 co-sponsors.

But OMB officials estimate that a 4.1 percent pay raise would cost $1.4 billion more than a 2.6 percent pay raise. The administration hasn't announced what portion of that 2.6 percent raise would be an across-the-board increase and what portion would be divided up for locality-based increases.

The Congressional Research Service report noted that President Bush is required under FEPCA to submit an alternative plan to Congress by Sept. 1 explaining why he doesn't plan to give a 3.1 percent across-the-board pay raise to civilian personnel. He would also have to explain smaller locality-based increases by Nov. 30. Congress can also force the president to assign a particular raise through use of the appropriations process, which Hoyer and other representatives have vowed to do.

The report also noted that the Federal Salary Council, a body of federal union representatives headed by labor relations expert William J. Sheffield, recommended that no new locality pay areas be added to the existing list of 32, and that no cities be dropped from the current list.

The Congressional Research Service does not make its reports available to the public.