[House Document 108-237]
[From the U.S. Government Publishing Office]
108th Congress, 2d Session - - - - - - - - - - - - House Document 108-
237
AN ALTERNATIVE PLAN FOR
LOCALITY PAY INCREASES
__________
COMMUNICATION
from
THE PRESIDENT OF THE UNITED STATES
transmitting
AN ALTERNATIVE PLAN FOR LOCALITY PAY INCREASE PAYABLE TO CIVILIAN
FEDERAL EMPLOYEES COVERED BY THE GENERAL SCHEDULE (GS) AND CERTAIN
OTHER PAY SYSTEMS IN JANUARY 2005, PURSUANT TO 5 U.S.C. 5305(a)(3)
December 6, 2004.--Referred to the Committee on Government Reform and
ordered to be printed
The White House,
Washington, November 29, 2004.
Hon. J. Dennis Hastert,
Speaker of the House of Representatives,
Washington, DC.
Dear Mr. Speaker: I am transmitting an alternative plan for
the locality pay increase payable to civilian Federal employees
covered by the General Schedule (GS) and certain other pay
systems in January 2005.
Under title 5, United States Code, civilian Federal
employees covered by the GS and certain other pay systems would
receive a two-part pay increase in January 2005: (1) a 2.5
percent across-the-board increase in scheduled rates of basic
pay derived from Employment Cost Index data on changes in the
wages and salaries of private industry workers, and (2) a
locality pay increase based on Bureau of Labor Statistics'
salary surveys of non-Federal employers in each locality pay
area, which would average about 10.6 percent for eligible
employees. Including increases for blue-collar and other
workers, the total Federal employee pay increase would cost
about 11.2 percent of payroll in calendar year 2005. For
Federal employees covered by the GS locality pay system, the
overall average pay increase would be about 13.1 percent, far
higher than 1.5 percent total pay increase I proposed in my
Fiscal Year 2005 budget.
For the reasons described below, I have determined that it
is appropriate to exercise my statutory alternative plan
authority to limit the January 2005 GS locality pay increase.
A national emergency has existed since September 11, 2001,
which now includes Operation Enduring Freedom (in Afghanistan)
and Operation Iraqi Freedom. Full statutory civilian locality
pay increases averaging 10.6 percent in 2005 would divert
resources from and interfere with our Nation's ability to fight
the war on terror, with respect to which a national emergency
is in effect under the law. Such increases would cost about
$9.8 billion in fiscal year 2005 alone and would build in later
years.
Accordingly, I have determined that under the authority of
section 5304a of title 5, United States Code, the locality pay
percentages authorized in 2004 shall remain in effect in 2005.
Finally, the law requires that I include in this report an
assessment of the impact of my decision on the Government's
ability to recruit and retain well-qualified employees. This
decision will not materially affect our ability to continue to
attract and retain a quality Federal workforce. To the
contrary, since the Congress has not funded the cost of a pay
raise in excess of the 1.5 percent increase I proposed,
agencies would have to absorb the additional cost and could
have to freeze hiring in order to pay the higher rates.
Moreover, GS quit rates are at an all-time low of 1.6 percent
per year, well below the overall average quit rate in private
enterprise. Should the need arise, the Government has many
compensation tools, such as recruitment bonuses, retention
allowances and special salary rates, to maintain the high
quality workforce that serves our Nation so very well.
Sincerely,
George W. Bush.