U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 

1 

59–011 2006

109th Congress, 2d Session – – – – – – – – – – – – Document 109–154 

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 2007, PURSUANT TO 5 U.S.C. 5305(a)(3) 

DECEMBER 5, 2006.—Referred to the Committee on Government Reform 

and ordered to be printed 


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THE WHITE HOUSE, 

Washington, November 30, 2006. 

Hon. J. DENNIS HASTERT, 

Speaker of the House of Representatives, 

Washington, DC 

DEAR MR. SPEAKER: I am transmitting an alternative plan for locality pay increases payable to civilian Federal employees covered 

by the General Schedule (GS) and certain other pay systems in 

January 2007. 

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 2007: (1) A 1.7 percent acrossthe-board adjustment 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 6.9 percent locality pay adjustment based on Bureau of Labor Statistics’ salary surveys of 

non-Federal employers in each locality pay area. According to the 

statutory formula, for Federal employees covered by the locality 

pay system, the overall average pay increase would be about 8.6 

percent. The total Federal employee pay increase would cost about 

$8.8 billion in fiscal year 2007 alone. 

Title 5, United States Code, authorizes me to implement an alternative locality pay plan if I view the adjustment that would otherwise take effect as inappropriate due to ‘‘national emergency or 

serious economic conditions affecting the general welfare.’’ For the 

reasons described below, I have determined that it would be appropriate to exercise my statutory alternative plan authority to set an 

alternative January 2007 locality pay increase. 

A national emergency, within the meaning of chapter 53 of title 

5, has existed since September 11, 2001, that includes Operation 

Enduring Freedom in Afghanistan and Operation Iraqi Freedom. 

The growth in Federal requirements is straining the Federal budget. Full statutory civilian pay increases costing $8.8 billion in 2007 

alone would interfere with our Nation’s ability to pursue the war 

on terrorism. 

Such cost increases would threaten our efforts against terrorism 

or force deep cuts in discretionary spending or Federal employment 

to stay within budget. Neither outcome is acceptable. Therefore, I 

have determined that a locality pay increase of 0.5 percent would 

be appropriate for GS and certain other employees in January 

2007. Our national situation precludes granting larger locality pay 

increases at this time. 

Accordingly, I have determined that under the authority of section 5304a of title 5, United States Code, locality-based comparability payments for the locality pay areas in amounts set forth 

in the attached table shall become effective on the first day of the 

first applicable pay period beginning on or after January 1, 2007. 


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When compared with the payments currently in effect, these comparability payments will increase the General Schedule payroll by 

0.5 percent. 

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. I do not believe this decision will materially affect our ability to continue to attract and 

retain a quality Federal workforce. To the contrary, since any pay 

raise above what I have proposed would likely be unfunded, 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 continue to be very low (2.0 percent on an annual basis), 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. 

2007 LOCALITY-BASED COMPARABILITY PAYMENTS UNDER

ALTERNATIVE PLAN

Locality Pay Area Locality Payment 

Percentage 

Atlanta-Sandy Springs-Gainesville, GA–AL ................................................. 15.89 

Boston-Worcester-Manchester, MA–NH–ME–RI .......................................... 20.97 

Buffalo-Niagara-Cattaraugus, NY .................................................................. 14.15 

Chicago-Naperville-Michigan City, IL–IN–WI .............................................. 21.79 

Cincinnati-Middletown-Wilmington, OH–KY–IN ......................................... 17.38 

Cleveland-Akron-Elyria, OH ........................................................................... 15.96 

Columbus-Marion-Chillicothe, OH ................................................................. 15.00 

Dallas-Fort Worth, TX .................................................................................... 17.34 

Dayton-Springfield-Greenville, OH ................................................................ 14.27 

Denver-Aurora-Boulder, CO ........................................................................... 20.02 

Detroit-Warren-Flint, MI ................................................................................ 21.53 

Hartford-West Hartford-Willimantic, CT–MA .............................................. 22.44 

Houston-Baytown-Huntsville, TX ................................................................... 26.65 

Huntsville-Decatur, AL ................................................................................... 13.60 

Indianapolis-Anderson-Columbus, IN ............................................................ 13.00 

Los Angeles-Long Beach-Riverside, CA ......................................................... 24.03 

Miami-Fort Lauderdale-Miami Beach, FL .................................................... 18.30 

Milwaukee-Racine-Waukesha, WI .................................................................. 15.54 

Minneapolis-St. Paul-St. Cloud, MN–WI ....................................................... 18.17 

New York-Newark-Bridgeport, NY–NJ–CT–PA ........................................... 24.57 

Philadelphia-Camden-Vineland, PA–NJ–DE–MD ........................................ 18.85 

Phoenix-Mesa-Scottsdale, AZ .......................................................................... 13.22 

Pittsburgh-New Castle, PA ............................................................................. 14.16 

Portland-Vancouver-Beaverton, OR–WA ....................................................... 17.63 

Raleigh-Durham-Cary, NC ............................................................................. 16.18 

Richmond, VA .................................................................................................. 14.41 

Sacramento-Arden-Arcade-Truckee, CA–NV ................................................. 18.99 

San Diego-Carlsbad-San Marcos, CA ............................................................. 20.34 

San Jose-San Francisco-Oakland, CA ............................................................ 30.33 

Seattle-Tacoma-Olympia, WA ......................................................................... 18.58 

Washington-Baltimore-Northern Virginia, DC–MD–PA–VA–WV ............... 18.59 

Rest of U.S. ...................................................................................................... 12.64 

Æ 


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