2023 Federal Employee Pay: Changes in Two 2023 GS Locality Pay Areas

No New GS Locality Pay Areas in 2023

There are no new 2023 GS locality pay areas being established. However, there are changes in two existing locality pay areas—one area in Illinois and one in Texas.

Federal employees will find out this month what the dollar amount of their paychecks will be in 2023 in the next several weeks.

President Biden will issue an Executive Order on 2023 federal pay rates this month. This Order will have an attachment that displays the General Schedule (GS) pay rate for every locality pay area under the General Schedule pay system.

For 2023, there have not been many changes in GS locality pay areas. There are likely to be many more changes in 2024.

How Does the GS Locality Pay System Work?

The Federal Salary Council (FSC) no longer has several members that voice a dissenting opinion on the overall approach for the federal pay recommendations. Moreover, this administration has bent over backward seeking to favor policies of interest to unions and that was not the case under the previous administration.

While at least some of the FSC recommendations are likely to eventually be adopted, it is unlikely these will be reflected in the 2023 locality pay area salary structure.

The Office of Personnel Management (OPM) will normally propose a new rule in the Federal Register to make changes in locality pay after the President’s Pay Agent has voted to make changes. The process takes a few months, so 2024 is the most likely target for many of the changes recommended by the FSC.

At least some of the recommended changes are likely in 2024. The locality pay system does not require legislative approval. Under the current structure, the FSC makes recommendations to the President’s Pay Agent, the Pay Agent accepts, rejects, or modifies the recommendations, OPM proposes the changes in the Federal Register, a second Federal Register notice is usually published adopting the proposed changes. After these steps are taken, an Executive Order is issued for the coming year implementing the changes that have been made.

This system is obviously not designed to be quick, easy, or easily understood by the federal workforce or the American public.

The last report issued by the President’s Pay Agent was dated December 15, 2021. The Pay Agent’s report is likely to be published and dated sometime this month.

Congress does not get involved in these deliberations. As long as the President’s Pay Agent accepts proposals from the FSC, the new salary changes can be implemented regardless of which party is in control of the House and Senate. Congress obviously could get involved if it wished to do so, but that rarely happens on issues often viewed as internal minutiae of the federal bureaucracy.

In other words, the process enables approval of a federal employee pay raise for a locality pay area without involving Congress. Historically, while Democrats are often viewed as being more attuned to federal employee issues and more concerned about federal employee union issues, the largest pay raises have been awarded under Republican administrations.

Changes in 2022 GS Locality Pay Area Definitions for GS Pay Schedule

The President’s Pay Agent geographically defined the locality pay areas listed below after considering recommendations from the Federal Salary Council. These locality pay areas were applicable in January 2022 and were defined using criteria consistently applied for all locations throughout the country. The 2023 locality pay areas will be substantially the same.

The locality pay rates for each area will be finalized later this month when OPM issues the 2023 General Schedule pay tables.

With regard to 2023 pay rates, on September 21, 2022, OPM published a proposed rule in the Federal Register on behalf of the President’s Pay Agent.

In its latest published report, no new locality pay areas were created for 2022. The Pay Agent did approve adding Carroll County, Illinois to the Davenport, Iowa locality pay area. The Federal Register notice also proposed adding Brooks County, Texas, as an area of application to the Corpus Christi-Kingsville-Alice, Texas, locality pay area.

The “appropriate rulemaking” procedures were followed and, on December 3, OPM published a “final rule” adopting the proposals published in September. The Federal Register notice states, “Those changes in the geographic definitions of those locality pay areas are applicable on the first day of the first pay period beginning on or after January 4, 2023.”

2022 GS Locality Pay Area Definitions: Changes in Illinois and Texas

The President’s Pay Agent geographically defined the locality pay areas listed below after considering recommendations from the Federal Salary Council.

These locality pay areas were applicable in January 2022 and were defined using criteria  applied to all locations throughout the country. The 2023 locality pay areas will be substantially the same with the addition of Carroll County, Illinois, as an “area of application” to the Davenport-Moline, Iowa-Illinois locality pay area, and Brook County, Texas will be added as an area of application to the Corpus Christi-Kingsville-Alice, Texas, locality pay area.

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