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January 2004 Pay Adjustments

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Office of Personnel Management.




The President adjusted the rates of basic pay and locality payments for certain categories of Federal employees effective in January 2004. This notice documents those pay adjustments for the public record.

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Carey Johnson, Center for Pay and Performance Policy, Division for Strategic Human Resources Policy, Office of Personnel Management; (202) 606-2858; FAX (202) 606-0824; or e-mail to

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On December 30, 2003, the President signed Executive Order 13322 (69 FR 231, January 2, 2004), which implemented a 2.0 percent overall average increase above the 2003 rates. Executive Order 13322 provided an across-the-board increase of 1.5 percent in the rates of basic pay for the statutory pay systems and an overall average increase in the General Schedule (GS) locality rates equal to approximately 0.5 percent of the GS payroll. On March 3, 2004, the President signed Executive Order 13332 (69 FR 10889, March 8, 2004), which amended Executive order 13322 to provide a retroactive pay increase averaging 4.1 percent above the 2003 rates (in lieu of the 2.0 percent overall average increase originally implemented). The President made these adjustments consistent with the Consolidated Appropriations Act, 2004 (Public Law 108-199, January 23, 2004).

Schedule 1 of Executive Order 13332 provides the rates for the 2004 General Schedule and reflects a 2.7 percent across-the-board increase. Executive Order 13332 also includes the percentage amounts of the 2004 locality payments. (See Section 5 and Schedule 9 of Executive Order 13332.)

The publication of this notice satisfies the requirement in section 5(b) of Executive order 13332 that the Office of Personnel Management (OPM) publish appropriate notice of the 2004 locality payments in the Federal Register.

GS employees receive locality payments under 5 U.S.C. 5304. Locality payments apply in the 48 contiguous States and the District of Columbia. In 2004, locality payments ranging from 10.90 percent to 24.21 percent apply to GS employees in 32 locality pay areas. These 2004 locality pay percentages, which replaced the locality pay percentages that were applicable in 2003, became effective on the first day of the first applicable pay period beginning on or after January 1, 2004. An employee's locality-adjusted annual rate of pay is computed by increasing his or her scheduled annual rate of basic pay (as defined in 5 U.S.C. 5302(8) and 5 CFR 531.602) by the applicable locality pay percentage. (See 5 CFR 531.604 and 531.605.)

Executive Order 13332 establishes the new Executive Schedule, which incorporates the 2.2 percent increase (rounded to the nearest $100) required under 5 U.S.C. 5318. By law, Executive Schedule officials are not authorized to receive locality pay.

Section 1125 of the National Defense Authorization Act for Fiscal year 2004 (Public Law 108-136, November 24, 2003) established a new performance-based pay system for the Senior Executive Service (SES). The new law replaces the former six-level SES pay system with a single open-range pay system with only the minimum and maximum rates of pay set by law. The minimum rate of basic pay may not be less than the minimum rate payable under 5 U.S.C. 5376 for senior-level positions ($104,927 in 2004), and the maximum rate of basic pay may not exceed the rate for level III of the Executive Schedule ($145,600 in 2004). The maximum rate of the SES rate range will increase to level II of the Executive Schedule ($158,100 in 2004) in those agencies that are certified under 5 U.S.C. 5307(d) as having executive performance appraisal systems that make meaningful distinctions based on relative performance. Additional information on the SES pay system is available on the Internet at​oca/​compmemo/​2004/​2004-03.asp.

The Executive order adjusted the rates of basic pay for administrative law judges (ALJs) by 2.2 percent (rounded to the nearest $100). The maximum rate of basic pay for ALJs is set by law at the rate for level IV of the Executive Schedule, which is now $136,900. (See 5 U.S.C. 5372.)

The rates of basic pay for Board of Contract Appeals (BCA) members are calculated as a percentage of the rate for level IV of the Executive Schedule. (See 5 U.S.C. 5372a.) Therefore, BCA rates of basic pay were increased by approximately 2.2 percent. Also, the maximum rate of basic pay for senior-level (SL) and scientific or professional (ST) positions was increased by approximately 2.2 percent (to $136,900) because it is tied to the rate for level IV of the Executive Schedule. The minimum rate of basic pay for SL/ST positions is equal to 120 percent of the minimum rate of basic pay for GS-15 and thus was increased by 2.7 percent (to $104,927). (See 5 U.S.C. 5376.)

On December 17, 2003, the President's Pay Agent extended the 2004 locality-based comparability payments to certain categories of non-GS employees. The Governmentwide categories include employees in SL/ST positions, ALJs, and BCA members. The maximum locality rate of pay for these employees is the rate for level III of the Executive Schedule ($145,600 in 2004).

OPM published “Salary Tables for 2004,” (OPM Doc. 124-48-6) in May 2004. This publication provides complete salary tables incorporating the 2004 pay adjustments, information on general pay administration matters, locality pay area definitions, Internal Revenue Service withholding tables, and other related information. The rates of pay shown in this publication are the official rates of pay for affected employees and are hereby incorporated as part of this notice. You may purchase copies of “Salary Tables for 2004” from the Government Printing Office (GPO) by calling (202) 512-1800 (outside the DC area: 1-866-512-1800) or FAX (202) 512-2250. You may order copies directly from GPO on the Internet at In addition, you can find pay tables on OPM's Internet Web site at​oca/​payrates/​index.asp.

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Office of Personnel Management.

Kay Coles James,


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[FR Doc. 04-10868 Filed 5-12-04; 8:45 am]