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OPM finalizes new locality pay areas ahead of 2024 pay raise
The Office of Personnel Management last week finalized a series of revisions to the map of locality pay areas, meaning that come January, around 33,300 federal employees will begin to see larger annual pay increases.
Last December, the President’s Pay Agent, which is made up of OPM Director Kiran Ahuja, Office of Management and Budget Director Shalanda Young and Acting Labor Secretary Julie Su, approved the creation of four new locality pay areas, as well as a comprehensive update to incorporate recent OMB changes to the map of metropolitan and combined statistical areas. After years of debate, the pay agent opted to take an approach whereby locations added to OMB’s map were likewise added to existing locality pay areas, while areas that were removed from OMB’s map were held harmless, remaining in their current locality pay area.
In a final rule published to the Federal Register last week, OPM officially implemented those changes. Beginning in January, the list of locality pay areas will include Fresno-Madero-Hanford, Calif., Reno-Fernley, Nev., Rochester-Batavia-Seneca Falls, N.Y., and Spokane-Spokane Valley-Coeur d’Alene, Wash.-Idaho. A non-exhaustive list of additions to existing locality pay areas stemming from the OMB map update can be found here.
But in its filing, OPM reported that some members of the public were confused by its summary of locality pay area changes as published in its proposed regulations on the topic last June and said it would publish a more comprehensive list of changes in the coming weeks.
“A number of comments reflected misunderstanding of the proposed rule’s geographic definitions of locality pay areas, with some comments indicating a mistaken belief that certain counties actually included in a proposed locality pay area were excluded and that a correction would therefore be needed prior to publication of a final rule,” OPM wrote. “[These] comments all expressed concern about locations which, while not listed as individual counties [in the proposed rule], were all included in the MSA or CSA listed for the locality pay area and therefore did not need to be listed as individual counties. OPM plans to post the definitions of locality pay areas at the county level on its website after these final regulations are issued.”
The final regulations also add two additional counties—Clallam and Jefferson—to the Seattle-Tacoma locality pay area in Washington state. Although the Federal Salary Council, an advisory body made up of political appointees and officials from federal sector labor unions, had already recommended the two counties’ inclusion, the President’s Pay Agent had not finished deliberations on the issue when OPM published its regulatory proposal in June.
“Based on the pay agent’s review of the council’s analysis of those two counties for locality pay in January 2024, the pay agent agrees with the council’s reasoning on those two counties,” OPM wrote. “[Jefferson] County and Clallam County, Wash., are therefore being included in the Seattle, Wash., locality pay area in this final rule.”
The new regulations will take effect Dec. 16, although they will not have a practical impact until the first full pay period of 2025, which begins Jan. 12.
President Biden is set to finalize and implement an average 5.2% pay raise—with a 4.7% across-the-board increase to basic pay and an average 0.5% boost to locality pay—for 2024 next month.
