Non-Foreign Area Retirement Equity Assurance Act Approved by Senate Committee
Friday, April 10, 2009(National Federation of Federal Employees)
Last week, the Senate
Committee on Homeland Security and Government
Affairs approved the Non-Foreign Area
Retirement Equity Assurance Act (Non-Foreign
AREA Act), S.507, a bill that will extend
locality pay to federal employees located
outside of the 48 contiguous states.
Under current law,
federal employees working in Alaska, Hawaii,
and the U.S. Territories receive a yearly COLA
payment in lieu of the locality pay received by
their mainland counterparts. Whereas locality pay is
factored in when calculating one’s retirement
annuity, COLA payments are left out of the
equation.
The result
of this discrepancy is a significantly lower
‘high 3,’ and thus, retirement annuity, for
employees working in Alaska, Hawaii, or a U.S.
territory, than that enjoyed by employees in
identical positions working within the
contiguous 48 states.
A companion
bill in the House, HR.1266, is currently under
review by the House Committee on Oversight and
Government Reform.
