Although the GS locality pay system has never been funded at the level needed to make it operate as originally envisioned, there is variation in pay rates among localities, making the drawing of boundaries significant. Adding an area to a designated locality takes it out of the catchall “rest of the U.S.” locality and would have the effect of raising pay slightly-for example, a GS-11, step 1 in the Boston locality makes about $2,000 more than one in the “RUS” locality. Pay in the highest-paid locality, the San Francisco-Oakland-San Jose area, is about 10 percent above that in the “RUS” locality. Locality pay is paid according to where employees work, not where they live, and is based on trends in the local job markets–not, as many employees continue to mistakenly believe, according to the cost of living in an area. While changes in locality zone boundaries are fairly common, no new separate locality area has been added since 1998.