Prevailing Rate Systems; Redefinition of Philadelphia, PA, and New York, NY, Appropriated Fund Wage Areas

Office of Personnel Management

5 CFR Part 532

RIN 3206-AI30

Prevailing Rate Systems; Redefinition of Philadelphia, PA, and

New York, NY, Appropriated Fund Wage Areas

AGENCY: Office of Personnel Management.

ACTION: Final rule.

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SUMMARY: The Office of Personnel Management (OPM) is issuing a final

rule to redefine Ocean County, NJ, excluding the portion occupied by

the Fort Dix Military Reservation, from the area of application of the

Philadelphia, PA, appropriated fund Federal Wage System (FWS) wage area

to the area of application of the New York, NY, wage area. This change

is being made so that the wage area definition of Ocean County will be

more reflective of the transportation and commuting patterns in central

New Jersey.

DATES: Effective: December 16, 1998. Federal Wage System employees

[[Page 63592]]

stationed in Ocean County, NJ, excluding the portion occupied by the

Fort Dix Military Reservation, will be moved from the Philadelphia, PA,

wage schedule to the New York, NY, wage schedule on the first day of

the first applicable pay period beginning on or after this date.

FOR FURTHER INFORMATION CONTACT: Mark Allen at (202) 606-2848, or send

an email message to [email protected].

SUPPLEMENTARY INFORMATION: The Office of Personnel Management (OPM) is

engaged in an ongoing project to review the geographic definitions of

selected Federal Wage System (FWS) appropriated fund wage areas. On

June 23, 1998, OPM published a proposed rule to redefine Ocean County,

NJ, excluding the portion occupied by the Fort Dix Military

Reservation, from the area of application of the Philadelphia, PA,

appropriated fund FWS wage area to the area of application of the New

York, NY, wage area (63 FR 34134). The proposed rule provided a 30-day

period for public comment, during which OPM received several comments

requesting that Lakehurst Naval Air Station, the main employer of FWS

workers in Ocean County, remain in the Philadelphia FWS wage area. The

comments we received are addressed below, following an introduction to

this issue.

The Federal Prevailing Rate Advisory Committee (FPRAC), the

statutory national labor-management committee responsible for advising

OPM on matters concerning the pay of FWS employees, recommended by

majority vote that OPM redefine Ocean County, NJ, excluding the portion

occupied by the Fort Dix Military Reservation, from the area of

application of the Philadelphia, PA, appropriated fund FWS wage area to

the area of application of the New York, NY, wage area. FPRAC is

composed of representatives from the Department of Defense, the

Department of the Army, the Department of the Navy, the Department of

the Air Force, the Department of Veterans Affairs, OPM, the American

Federation of Government Employees, the Metal Trades Department, the

National Association of Government Employees, and the National

Federation of Federal Employees.

Section 532.211 of title 5, Code of Federal Regulations, lists the

following criteria that OPM uses to determine appropriate FWS wage area

boundaries:

(i) Distance, transportation facilities, and geographic features;

(ii) Commuting patterns; and

(iii) Similarities in overall population, employment, and the kinds

and sizes of private industrial establishments.

Ocean County is located in central New Jersey and is bordered by

Burlington County to the West and Monmouth County to the North. FPRAC

studied the appropriate wage area definition of Ocean County

exhaustively. Based on their analysis of the regulatory criteria, the

management members of FPRAC found no compelling reason to change the

wage area designation of Ocean County. The labor members of the

Committee argued that the transportation facilities and commuting

patterns criteria favor placing Ocean County in the New York wage area.

After failing to reach consensus, the Committee voted to accept the

labor recommendation, with the Chairman of the Committee casting the

tie-breaking vote in support of the labor position. The management

members of FPRAC filed a minority report in opposition to the FPRAC

majority recommendation.

After careful consideration, OPM finds it appropriate to accept the

FPRAC recommendation in this case. OPM has not overruled an FPRAC

recommendation concerning the definition of an FWS wage area since the

Committee was established in 1972. The distance, geographic features,

and overall population, employment, and the kinds and sizes of private

industrial establishments criteria do not clearly favor defining Ocean

County to one wage area more than another. However, we find that the

transportation facilities and commuting patterns criteria clearly favor

defining Ocean County to the New York wage area rather than to the

Philadelphia wage area.

The largest employer of FWS workers in Ocean County is Lakehurst

Naval Air Station, although several other smaller employment sites will

be affected by the redefinition of Ocean County to the New York wage

area. Employees with official duty stations in the Fort Dix Military

Reservation portion of Ocean County will remain in the Philadelphia

wage area. Employees with official duty stations at Lakehurst Naval Air

Station and other facilities in Ocean County will be moved from the

Philadelphia wage schedule to the New York wage schedule on the first

day of the first applicable pay period beginning on or after 30 days

after the issuance of this final regulation.

The comments received in response to the proposed rule raised

issues that had been considered and discussed exhaustively during the

deliberations of the Federal Prevailing Rate Advisory Committee on this

matter. Commenters suggested that there is no clear demonstration of

need to cause a change in the definitions of the Philadelphia and New

York wage areas. FPRAC found that a demonstrated need exists to make

this change. We find that this change is necessary so that the wage

area definition of Ocean County will be in line with the regulatory

criteria for defining FWS wage areas. This change will enable the wage

area definition of Ocean County to be more reflective of the

transportation and commuting patterns in central New Jersey.

Commenters suggested that the use of commuting patterns and

transportation facilities to justify a change is not supportable,

citing the fact that 14 percent of the resident workforce of Ocean

County commutes to work in the New York survey area, and citing

anecdotal evidence that few blue-collar workers are included in this

percentage. FPRAC found that the percentage of the Ocean County

resident workforce commuting to New York is significant enough to favor

removing the county from the Philadelphia wage area and redefining it

to the New York wage area. Also, FPRAC received additional anecdotal

evidence from local employees in Ocean County that significant numbers

of blue-collar workers commute from Ocean County to jobs in New York,

and that transportation facilities between Ocean County and New York

are far better than between Ocean County and Philadelphia. We find that

the commuting pattern and transportation facility information fully

supports defining Ocean County to the New York wage area.

Commenters pointed out that Ocean County is contiguous to the

Philadelphia survey area but not contiguous to the New York survey

area. While this is true, the distance criteria for defining FWS wage

areas shows that Ocean County is about the same distance by road from

the center of the New York survey area as it is from the center of the

Philadelphia survey area. Therefore, OPM finds that the distance

criterion does not clearly favor defining Ocean County to one wage area

more than another.

Commenters stated that placing adjacent Department of Defense

installations (Fort Dix, McGuire Air Force Base, and Lakehurst Naval

Air Station) in separate wage areas would unnecessarily force the

installations to compete for the same employees to fill positions in

skilled aircraft maintenance occupations, thereby increasing the

potential for disruptions in accomplishing mission critical work at the

installations. Although not part of

[[Page 63593]]

the regulatory criteria for defining FWS wage areas, FPRAC considered

this issue carefully before making its recommendation to OPM. Should

agencies experience recruitment or retention problems in particular

occupations at an installation, OPM would consider the approval of

requests for special rates to address those problems.

Commenters stated that Lakehurst Naval Air Station is conducting

cost comparisons with private industry to consider contracting out

certain work, and that certain FWS employees at the installation will

be placed at a competitive disadvantage during these studies if paid

from the higher New York wage schedule. Although not among the

regulatory criteria for defining FWS wage areas, FPRAC considered this

issue carefully before making its recommendation to OPM. OPM finds that

it is not appropriate to preclude the appropriate redefinition of an

FWS wage area on the basis that the redefinition may increase the

likelihood that it may be possible for private sector companies to more

easily win contracts to provide services to Federal agencies.

Commenters requested that OPM redefine Ocean County to the New York

wage area, while leaving both the Fort Dix Military Reservation and

Lakehurst Naval Air Station portions of Ocean County in the

Philadelphia wage area. Under the regulatory criteria for defining FWS

wage areas, a county may not be split between two wage areas except in

unusual circumstances and as an exception to the regulatory criteria.

The Fort Dix Military Reservation portion of Ocean County will continue

to be defined to the Philadelphia wage area because the activity would

otherwise be split between two wage areas. With most of the Fort Dix

Military Reservation in Burlington County, and a lesser portion of the

installation in Ocean County, we believe this represents an example of

an appropriate exception to the regulatory criteria. OPM defines

several counties in a similar manner, using exceptions to the

regulatory criteria in certain wage areas to avoid splitting individual

installations among two or more wage areas. Although Lakehurst Naval

Air Station is adjacent to the Fort Dix Military Reservation portion of

Ocean County, Lakehurst Naval Air Station is a separate installation.

We do not believe it is appropriate to recognize that Ocean County is

linked more closely to New York than to Philadelphia under the

regulatory criteria for defining FWS wage areas, but then refuse to

acknowledge that the major FWS employer in the county should be treated

in accordance with the appropriate wage area definition of the county.

Regulatory Flexibility Act

I certify that these regulations will not have a significant

economic impact on a substantial number of small entities because they

affect only Federal agencies and employees.

List of Subjects in 5 CFR Part 532

Administrative practice and procedure, Freedom of information,

Government employees, Reporting and recordkeeping requirements, Wages.

Office of Personnel Management,

Janice R. Lachance,

Director.

Accordingly, OPM is amending 5 CFR part 532 as follows:

PART 532--PREVAILING RATE SYSTEMS

1. The authority citation for part 532 continues to read as

follows:

Authority: 5 U.S.C. 5343, 5346; Sec. 532.707 also issued under 5

U.S.C. 552.

Appendix C to Subpart B of Part 532 [Amended]

2. Appendix C to subpart B is amended by revising the wage area

listings for the New York, New York, and Philadelphia, Pennsylvania,

wage areas to read as follows:

Appendix C to Subpart B of Part 532--Appropriated Fund Wage and

Survey Areas

* * * * *

New York

* * * * *

New York

Survey Area

New York:

Bronx

Kings

Nassau

New York

Queens

Suffolk

Westchester

New Jersey:

Bergen

Essex

Hudson

Middlesex

Morris

Passaic

Somerset

Union

Area of Application. Survey area plus:

New York:

Putnam

Richmond

Rockland

New Jersey:

Monmouth

Ocean (excluding the Fort Dix Military Reservation)

Sussex

* * * * *

Pennsylvania

* * * * *

Philadelphia

Survey Area:

Pennsylvania:

Bucks

Chester

Delaware

Montgomery

Philadelphia

New Jersey:

Burlington

Camden

Gloucester

Area of Application. Survey area plus:

Pennsylvania:

Lehigh

Northampton

New Jersey:

Atlantic

Cape May

Cumberland

Hunterdon

Mercer

Ocean (Fort Dix Military Reservation only)

Warren

* * * * *

[FR Doc. 98-30511 Filed 11-13-98; 8:45 am]

BILLING CODE 6325-01-P