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Key developments in the world of federal employee benefits: health, pay, and much more.

Fill 'er up

Good news for federal travelers: The mileage reimbursement rate for travel by car is going up.

GSA sets the reimbursement rate for federal employees. The rate cannot exceed the rate established by the IRS. In November, the IRS announced it would increase its standard mileage reimbursement rate by two cents, to 34.5 cents per mile, in 2001.

The General Services Administration has decided to mirror that decision, raising the federal rate to 34.5 cents as well. But the new rate is not yet in effect. According to Jim Harte, travel team leader at GSA, approval of the new rate is in the final stages. GSA notified the secretaries of Defense and Treasury of the change, and the final package is awaiting a signature from the GSA administrator's office. Once language changing the rate is signed, the new rate will be published in the Federal Register and become effective.

GSA and IRS increased the rates to compensate for increasing costs in gasoline prices nationwide.

Pay Banding at the IRS

Progress is being made on implementation of a new pay banding system for employees at the IRS. In December, final criteria for establishing the pay banding systems were published in the Federal Register. Pay bands are broader (in fact, they're sometimes called "broad bands") than the General Schedule, a 15-level classification system with 10 steps in each level. Pay banding is supposed to result in a less rigid pay structure, giving managers more discretion to adjust pay.

Under the rules, IRS employees' total pay cannot be reduced upon initial conversion to a new pay band. Managers at the GS-14 and GS-15 levels will be the first to try out the new pay system, which will tie pay to performance. Top-level managers at IRS are expected to finish converting to the new system by April.

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