GSA Adds 10 New Non-Standard Per Diem Areas

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. August 20, 2012

Friday, August 20, 2012 - The U.S. General Services Administration (GSA) announced earlier this week that federal per diem rates for Fiscal Year 2013 (FY2013) for non-standard areas (NSAs) will be frozen at the existing FY2012 levels. Federal per diem rates will take effect October 1, 2012, and run through September 30, 2013.

The standard continental United States (CONUS) per diem rate that is not listed as a specific destination remains at $77 per night. That rate, which is reviewed every three years, was last adjusted for FY2011 when it was increased from $70 per night.

While the freeze in rates is not the industry's preferred approach, GSA had considered a much more drastic approach by abandoning its methodology in determining rates which is based on actual room rate data from mid-priced hotels.

Although it would vary by market, some estimates indicated that per diem rates would have been slashed by 30 percent if that approach were taken.

After AH&LA brought to the attention of GSA, the White House, and Congress the severe unintended consequences of radically changing the methodology and noted its strong objections, GSA decided not to implement that policy.

For FY2013, GSA added 10 new NSA areas that will have their own per diem rates. GSA has not yet released the actual rates, but those areas are:
• Bakersfield/Ridgecrest, California (Kern County);
• Stockton, California (San Joaquin County);
• Hancock and Pearl River Counties in Mississippi;
• Sidney/Glendive, Montana (Richland and Dawson Counties);
• Dickinson/Beulah, North Dakota (Stark, Mercer, and Billings Counties);
• Minot, North Dakota (Ward County);
• Williston, North Dakota (Williams, Mountrail, and McKenzie Counties);
• Carlsbad, New Mexico (Eddy County);
• Watertown, New York (Jefferson County), and;
• Pasco, Washington (Franklin County).

Per diem rates for these ten new areas will be released by GSA before September 1.

GSA establishes federal per diem rates by using market data provided by Smith Travel Research in order to establish rates that reflect the market where those rates apply. Although federal per diem rates cannot formally be appealed by business representatives, GSA does have the ability to review and modify the rates.

AH&LA is advising members who believe their localities may be undervalued in the FY2013 per diem rate schedule with a number of helpful suggestions that can be found on our Website. The complete FY2013 rates will be available on or before August 31, 2012, at the GSA per diem website, www.gsa.gov/perdiem.