Following are excerpts from a recent Congressional Research Service report examining the way raises for members of Congress are set.
There are three basic ways to adjust Member pay. Stand-alone legislation has frequently and primarily been used to raise Member pay throughout most of U.S. history, 1789 to the present.
However, two other methods are also available.
The second method by which Member pay can be increased is pursuant to recommendations from the President, based on those made by a quadrennial salary commission. In 1967, Congress established the Commission on Executive, Legislative, and Judicial Salaries to recommend salary increases for top-level federal officials (P.L. 90-206). Three times (in 1969, 1977, and 1987) Congress received pay increases made under this procedure; on three occasions it did not.
Effective with passage of the Ethics Reform Act of 1989 (P.L. 101-194), the commission ceased to exist. Its authority was assumed by the Citizens’ Commission on Public Service and Compensation. Although the first commission under the 1989 Act was to have convened in 1993, it did not meet.
The third method by which the salary of Members can be changed is by annual adjustments. Prior to 1990, the pay of Members, and other top-level federal officials, was tied to the annual comparability increases provided to General Schedule (GS) federal employees. This procedure was established in 1975 (P.L. 94-82). Such increases were recommended by the President, subject to congressional acceptance, disapproval, or modification. Congress accepted five such increases for itself—in 1975, 1979 (partial), 1984, 1985, and 1987—and declined 10 since this method was authorized (1976, 1977, 1978, 1980, 1981, 1982, 1983, 1986, 1988, and 1989).
The Ethics Reform Act of 1989 changed the method by which the annual adjustment is determined for Members and other senior officials. This procedure employs a formula based on changes in private sector wages and salaries as measured by the Employment Cost Index (ECI).
Under this revised method, annual adjustments were accepted 13 times (those scheduled for January 1991, 1992, 1993, 1998, 2000, 2001, 2002, 2003, 2004, 2005, 2006, 2008, and 2009) and denied six times (those scheduled for January 1994, 1995, 1996, 1997, 1999, and 2007). Under a provision included in the FY2009 Omnibus Appropriations Act, Members will not receive a pay adjustment in 2010.
The annual adjustment automatically goes into effect unless: 1. Congress statutorily prohibits the adjustment; 2. Congress statutorily revises the adjustment; or 3. The annual base pay adjustment of GS employees is established at a rate less than the scheduled adjustment for Members, in which case Members would be paid the lower rate.
January 2010 Member Pay Adjustment Denied
Under the formula established in the Ethics Reform Act, Members were originally scheduled to receive a pay adjustment in January 2010 of 2.1%. This adjustment was denied by Congress through a provision included in the FY2009 Omnibus Appropriations Act. Section 103 of Division J of the act states, “Notwithstanding any provision of section 601(a)(2) of the Legislative Reorganization Act of 1946 (2 U.S.C. 31(2)), the percentage adjustment scheduled to take effect under any such provision in calendar year 2010 shall not take effect.”
January 2009 Member Pay Adjustment of 2.8%
Under the formula established in the Ethics Reform Act, Members received a pay adjustment in January 2009 of 2.8%, increasing salaries to $174,000.
As noted above, Member pay adjustments may not exceed the annual base pay adjustment of GS employees. The two pay adjustments may differ because they are based on changes in different quarters of the Employment Cost Index (ECI) or due to actions of Congress and the President.
The 2.8% adjustment for Members, however, was less than the projected 2009 base GS adjustment of 2.9%. The GS rate became final on December 18, 2008, when President Bush issued an Executive Order adjusting rates of pay.