Lawmakers back 2 percent raise, but nix locality pay freeze

House-Senate negotiators on Tuesday night backed President Obama's request to give civilian federal employees a 2 percent pay raise in 2010, but rejected his proposal to freeze locality pay.

Conferees announced the omnibus spending package would include a 2 percent average pay hike for civilians in 2010. Employees would receive a 1.5 percent increase in base pay, and a 0.5 percent boost in locality pay.

That arrangement sticks to Obama's request for a 2 percent raise, rather than the 2.9 percent the Senate had included in its version of the Financial Services appropriations bill, which got wrapped into the omnibus package. But it rejects the president's Nov. 30 proposal to reserve the entire raise for an increase in base pay.

And in a break from previous years, the bill does not ensure pay parity between civilians and members of the military. Obama requested a 2.9 percent raise for service members, and lawmakers could grant an even more generous boost. The 2010 National Defense Authorization Act signed in October includes a 3.4 percent military raise; lawmakers will decide on a final figure as part of the Defense appropriations bill.

House Majority Leader Steny Hoyer, D-Md., said he was disappointed the omnibus will not preserve pay parity, but added that administration officials have assured him parity will return next year.

National Treasury Employees Union President Colleen Kelley praised the conferees for increasing locality pay.

"Under the administration's alternative pay plan, there would not have been any locality-based adjustments for the first time since that system began operating in 1994," Kelley said.

The inclusion of locality pay is "critical to bringing federal pay in line with the private sector and enabling the federal government to compete for high quality talent," said Hoyer, whose district is home to many federal workers.