Deadline for 2003 pay raise looms

Time is running out for President Bush to make a decision about whether to give federal employees a 3.1 percent across-the-board pay raise next year.

The formula for federal pay raises established under the 1990 Federal Employees Pay Comparability Act calls for a 3.1 percent across-the-board increase for 2003 plus locality-based increases in January 2003. The president has until the end of the day on Aug. 31 to offer an alternative plan, or the 3.1 percent increase stands.

When the budget was released in February, the Bush administration proposed a 2.6 percent pay increase for civilian workers and a 4.1 percent military pay increase in 2003. Office of Management and Budget Director Mitch Daniels defended the military-civilian pay raise split, saying, "We believe that a distinction can and should be made between [civilians and] people who are in harm's way at time of war."

Last month, House legislators approved a 4.1 percent pay raise as part of the fiscal 2003 Treasury-Postal Appropriations bill. Reps. Jim Moran, D-Va., Tom Davis, R-Va., Connie Morella, R-Md., Frank Wolf, R-Va., Albert Wynn, D-Md., and Del. Eleanor Holmes Norton, D-D.C., all lobbied the administration to keep the civilian pay raise the same as the military pay increase. But, administration officials continue to stand by the proposed 2.6 percent raise.

"The administration continues to support the 2.6 percent pay raise set out in the budget proposal, and we're working with Congress on this issue," OMB spokeswoman Amy Call said.

The administration is "planning to take no action at this time," according to Call, but with several days left before the deadline, Bush still has several scenarios to consider:

• Announce a 2.1 percent across-the-board increase, leaving an additional 1 percent to use for locality-based increases. Then, by the end of November, Bush would have to issue a decision explaining how the additional 1 percent would be divided up among workers in each locality.
• Announce a lower across-the-board increase, if he thinks he has a chance of preventing Congress from boosting the raise to 4.1 percent, or if he might veto the Treasury-Postal appropriations bill which includes the higher pay raise.
• Concede that Congress is going to approve the 4.1 percent total increase and do nothing this week. The 3.1 percent across-the-board increase would stick, and then Bush would issue a decision by the end of November divvying up the additional 1 percent among localities.

Officials at the Office of Personnel Management have had several conversations with administration officials, but Donald Winstead, OPM's acting associate director for the workforce compensation and performance service, declined on Tuesday to reveal what action the agency recommended to the president.

"The administration asked Congress earlier this year to approve overall a 2.6 percent increase and they stand by that request," Winstead said.