- The Washington Times - Monday, October 13, 2003

Federal workers in New York, San Francisco and Houston — to name a few cities — earn more than their counterparts doing the same jobs in Washington, and a lot more than same-job-same-grade feds in Norfolk, Nashville, Tenn., or Austin, Texas.

That higher pay scale over time boosts the value of their retirement benefits, the dollar value of any unused vacation time they cash in, and the amount they contribute and the matching contributions they get to their 401(k) plans.

The reason some feds are paid more than others for doing the same job is the locality pay feature of a bipartisan 1990 law that has been ignored or sidestepped on a bipartisan basis since it went into effect in 1993. The law guaranteed that feds would have pay parity with their private-sector counterparts by, well, now.

The only part of the law that has worked is the locality pay. In addition to the regular across-the-board pay raise in January for all white-collar feds, those in 32 locality pay cities get higher increases.

The Clinton and now the Bush administration have used escape hatches in the pay law to trim raises called for each year. They argue that it is impossible and maybe wrong to say that feds are underpaid compared with private-sector workers when features like pension benefits, lifetime health insurance, vacation and legal holidays are considered in the compensation matchup.

According to the latest government data, the gap between similar federal and private-sector jobs is in the 30 percent range. The gap is much wider in New York City, but 22 percent to 31 percent, depending on which data are used, in Richmond. Most feds believe in the pay gap, but most private-sector workers don’t.

The Clinton and Bush administrations fall into the nonbeliever crowd. That is one reason the Office of Management and Budget is looking at changing locality-pay definitions to ensure tighter controls, and to exclude feds in lower-wage areas who are now under the locality-pay security blanket.

Feds and politicians who represent them are nervous about the OMB plan. That is why they are pushing language in the Treasury appropriations bill that would slow the administration’s effort to contract out government work to the private sector. It also contains a 4.1 percent federal pay raise instead of the 2 percent the president wants.

The OMB has recommended a presidential veto of the bill, mainly because of its effort to limit contracting out work.

Health premiums

Federal health care premiums, as paid by white-collar workers and retirees, are going up an average of 10.6 percent in January. That is the official government figure, so you know it’s got to be right.

But when people do the math, looking at their health plans, they come up with a very different — often much higher — percentage increase. Right.

The difference is that one figure is an average of the six major plans in the program, which have about 80 percent of the enrolled population. So the average is as accurate as any average ever is — interesting as a statistic but often misleading or not useful in a real-life application.

The difference between the average premium rise in the federal health program and the amount you will pay if you stick with your current plan is something you shouldn’t overlook. That is especially true for retirees who have a tendency to stick with the same plan year after year.

This coming open season, which will run from Nov. 10 to Dec. 8, is the time to compare premiums and look for benefit changes. A good way to do it is to get someone in your doctor or dentist’s office to look at the brochures of plans you are considering. If it works for them, it’s a good plan for you. If not, you may need to get another plan, or another doctor or dentist.

If you have access to the Internet, you can look at the premiums for fee-for-service plans and for health maintenance organizations by going to: www.opm.gov.

We will chip in with a series of open-season columns listing the best buys — as analyzed by experts — for single and married feds, couples with and without children and for retirees with and without Medicare parts A and B. You either can save or pay up to $1,000 in premiums next year, depending on which plan you choose.

Mike Causey, senior editor at FederalNewsRadio.com, can be reached at 202/895-5132 or mcausey@federalnewsradio.com.

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