Fedweek

Despite President Trump’s call for a pay freeze last week a raise remains a possibility for 2019. On Congress’s plate this session is whether a federal employee pay raise will be paid in January, an issue to be dealt with in one of the regular appropriations bills – the general government bill.

The situation is essentially unchanged in light of President Trump’s message to Congress last week once again advocating a pay freeze. As commonly happens when that annual message is issued, many news organizations and websites without deep knowledge of federal pay-related matters misstated the impact. Some reported that Trump had canceled a scheduled raise; others suggested that his letter acts as a final decision; some made both mistakes.

In reality, Trump’s message was both expected and routine. The administration had proposed the freeze as far back as February (the intention to make that proposal had been public knowledge long before that) and it had repeated that proposal several times since then. The message is essentially a defensive step that Presidents take every year, in case a figure is not enacted into law by the end of the calendar year, to prevent a large raise that otherwise would kick in automatically under federal pay law.

The difference was that Trump’s letter this year provides for no raise in that situation, while prior recent ones had set default raises of 1-2 percent, and Congress had allowed the annual figure to take effect by not acting.

This year, the House in July passed its version of the general government bill taking no position on a raise—in essence, backing the default raise on the expectation that Trump would set it at zero, as he ultimately did. However, the Senate version of that same bill advocates a 1.9 percent average raise, divided as 1.4 percent across the board and 0.5 percentage points for locality pay to be paid in varying amounts. Such differences are resolved in conferences between the two chambers.

The Senate language is structured to be more palatable to fiscal conservatives in Congress by not adding money to agency budgets to fund the raise, requiring them to absorb the cost out of their general operating accounts instead. Further, Trump may have signaled willingness to go along with a raise when in a speech the day after sending his message he noted the opposition to it in Congress—mainly from Democrats but also from some Republicans—and said he would “study” the issue.

Both versions also continue a number of long-running standard policies including an extension of the ban on starting new “Circular A-76” studies for possibly turning federal jobs over to contractors.

A conference could begin at any time but the bill, along with many if not all of the other regular spending bills, could be pushed off until after the elections.