House leaders must resolve SEC pay raise issue

House Financial Services Chairman Oxley, R-Ohio, and Government Reform Chairman Dan Burton, R-Ind., have reached an impasse in their negotiations over pending SEC pay raise legislation and are looking to Republican leaders to act as the final arbiter in the matter, sources said Tuesday.

"We're looking at leadership to coordinate [it] at this point," an Oxley spokeswoman said, adding, "I think it looks good." House GOP leaders previously indicated they wanted Oxley and Burton to work out their differences on the pay provision, so that the underlying bill--which would reduce the fees investors pay to the SEC--could move quickly.

But several weeks of negotiations between the two offices appear to have yielded little more than a series of curt communications between the SEC, which strongly backs the raise, and the Office of Personnel Management, which supports Burton's position that the pay increase request is too broad in scope.

On Friday, Burton sent a three-page letter to House Speaker Dennis Hastert, R-Ill., alerting him to "a number of adverse policy and budgetary implications" of the SEC pay provision.

Burton said the provision would exempt the workers in question from Title V of the Civil Service Code, which specifies pay rates for classes of federal employees.

"I wanted to make sure you are aware what pay parity means as a practical matter. It means permitting collective bargaining over pay rates for this very narrow, specific group of federal employees without any pay cap whatsoever," Burton wrote.

"Mr. Speaker, I simply do not believe it is fair or just to single these federal employees out. Beyond the fact that the SEC has not adequately proven a verifiable agency-wide recruitment and retention problem, exempting the agency from Title V presents a terrible precedent. As a result of the debate involving the SEC a number of other agencies have already made known their desire to be taken out of Title V. These include the Department of Veterans Affairs, Commodity Futures Trading Commission, Export-Import Bank and the Patent Trademark Office."

Burton added: "Unfortunately, opening the floodgates and allowing a multitude of agencies to pay their employees unlimited salaries will bust the budget wide open. If [the bill] comes to the floor of the House in its present form, I intend to strenuously oppose its passage."