---
kind: "range"
citation: "5 C.F.R. §§ 9701.331–9701.334"
title: "5"
from: "9701.331"
to: "9701.334"
count: 4
url: "https://uscodex.org/cfr/5/9701.331..9701.334"
---

# §9701.331. General.


The basic pay ranges established under [§§ 9701.321 through 9701.323](/cfr/5/9701.321..9701.323.md) may be supplemented in appropriate circumstances by locality or special rate supplements, as described in [§§ 9701.332 through 9701.335](/cfr/5/9701.332..9701.335.md). These supplements are expressed as a percentage of basic pay and are set and adjusted as described in [§ 9701.334](/cfr/5/9701.334.md). As authorized by [§ 9701.356](/cfr/5/9701.356.md), DHS implementing directives will determine the extent to which [§§ 9701.331 through 9701.337](/cfr/5/9701.331..9701.337.md) apply to employees receiving a retained rate.


# §9701.332. Locality rate supplements.

- (a) For each band rate range, DHS may, after coordination with OPM, establish locality rate supplements that apply in specified locality pay areas. Locality rate supplements apply to employees whose official duty station is located in the given area. DHS may provide different locality rate supplements for different occupational clusters or for different bands within the same occupational cluster in the same locality pay area.
- (b) For the purpose of establishing and modifying locality pay areas, [5 U.S.C. 5304](/usc/5/5304.md) is not waived. A DHS decision to use the locality pay area boundaries established under [5 U.S.C. 5304](/usc/5/5304.md) does not require separate DHS regulations. DHS may, after coordination with OPM and in accordance with the public notice and comment provisions of [5 U.S.C. 553](/usc/5/553.md), publish Departmental regulations ([6 CFR Chapter I](/cfr/6/chI.md)) in the Federal Register that establish and adjust different locality pay areas within the 48 contiguous States or establish and adjust new locality pay areas outside the 48 contiguous States. These regulations are subject to the continuing collaboration process described in [§ 9701.105](/cfr/5/9701.105.md). As provided by [5 U.S.C. 5304(f)(2)(B)](/usc/5/5304.md?p=f-2-B), judicial review of any DHS regulation regarding the establishment or adjustment of locality pay areas is limited to whether or not the regulation was promulgated in accordance with [5 U.S.C. 553](/usc/5/553.md).
- (c) **Locality rate supplements are considered basic pay for only the following purposes—**
  - (1) Retirement under 5 U.S.C. chapter 83 or 84;
  - (2) Life insurance under 5 U.S.C. chapter 87;
  - (3) Premium pay under 5 U.S.C. chapter 55, subchapter V, or similar payments under other legal authority;
  - (4) Severance pay under [5 U.S.C. 5595](/usc/5/5595.md);
  - (5) Application of the maximum rate limitation set forth in [§ 9701.312](/cfr/5/9701.312.md);
  - (6) Determining the rate of basic pay upon conversion to the DHS pay system established under this subpart, consistent with [§ 9701.373(b)](/cfr/5/9701.373.md?p=b);
  - (7) Other payments and adjustments authorized under this subpart as specified by DHS implementing directives;
  - (8) Other payments and adjustments under other statutory or regulatory authority that are basic pay for the purpose of locality-based comparability payments under [5 U.S.C. 5304](/usc/5/5304.md); and
  - (9) Any provisions for which DHS locality rate supplements must be treated as basic pay by law.

# §9701.333. Special rate supplements.


DHS will, after coordination with OPM, establish special rate supplements that provide higher pay levels for subcategories of employees within an occupational cluster if DHS determines that such supplements are warranted by current or anticipated recruitment and/or retention needs. In exercising this authority, DHS will issue necessary implementing directives. Any special rate supplement must be treated as basic pay for the same purposes as locality rate supplements, as described in [§ 9701.332(c)](/cfr/5/9701.332.md?p=c), and for the purpose of computing cost-of-living allowances and post differentials in nonforeign areas under [5 U.S.C. 5941](/usc/5/5941.md).


# §9701.334. Setting and adjusting locality and special rate supplements.

- (a) Within its sole and exclusive discretion, DHS may, after coordination with OPM, set and adjust locality and special rate supplements. In determining the amounts of the supplements, DHS and OPM may consider mission requirements, labor market conditions, availability of funds, pay adjustments received by employees of other Federal agencies, and any other relevant factors.
- (b) DHS may, after coordination with OPM, determine the effective date of newly set or adjusted locality and special rate supplements. Established supplements will be reviewed for possible adjustment on an annual basis in conjunction with rate range adjustments under [§ 9701.322](/cfr/5/9701.322.md).