Union leader calls for hike in mileage reimbursement rate

As gasoline prices nationwide soared to levels measuring nearly twice those of a year ago, federal employees who drive personal vehicles on government business are seeking an increase in their mileage reimbursement.

Federal law allows the General Services Administration to establish a mileage reimbursement rate for government employees who use their own cars for work, but the GSA-mandated rate cannot exceed the rate established annually for tax deduction purposes by the Internal Revenue Service.

The IRS set the current rate at 40.5 cents per mile in November 2004. The 3 cents increase from the previous year was one of the largest ever and was the result of higher vehicle and fuel costs in September 2004, IRS officials said. But those higher gasoline prices pale in comparison to the prices motorists are now paying at the pump.

While the IRS did lift federal taxes on some types of diesel fuel used primarily by commercial trucks, it did not indicate any plans to review the mileage reimbursement rate. The IRS declined to comment on the issue on Tuesday.

According to AAA Mid-Atlantic's Daily Fuel Gauge Report, the average price for a gallon of regular unleaded gasoline in the United States was $1.85 one year ago. As of Tuesday, the average price reached $3.04 a gallon, with prices in the Washington Metro area averaging $3.23 per gallon.

In a letter Tuesday to IRS Commissioner Mark Everson, National Treasury Employees Union President Colleen Kelley asked the IRS to raise the reimbursement rate.

"This is placing an especially heavy burden on those who must travel to perform their work duties," Kelley wrote in the letter. "The current rate of $0.405 is simply insufficient to cover the actual costs of driving a car on government business when gas prices are over $3 per gallon."

Kelley said GSA has indicated that it would be willing to increase the rate, but is unable to do so until the IRS raises the rates.

GSA spokeswoman Mary Alice Johnson confirmed this, and said federal laws forbid GSA from setting mileage reimbursement rates higher than the IRS'.

John B. Townsend II, AAA Mid-Atlantic's government and public affairs manager, predicated that the price of a gallon of gas will level off.

"While it is too soon to say this is a harbinger of things to come, it appears the price situation at the pump is stabilizing," Townsend said. "After a wild ride, the price of gas actually dipped by a penny at pumps in Virginia and by 2 cents at gas stations across the nation."

Maryland and Washington currently have the highest pump prices in the country according to AAA, with gas prices jumping nearly 10 cents a gallon overnight in Washington.