New Federal Per Diem Rates for FY 2012
The General Services Administration (GSA) establishes the per diem rates for the lower 48 continental United States (CONUS), which are the maximum allowances that federal employees are reimbursed for expenses incurred while on official travel.
The CONUS per diem rate for an area is actually three allowances: the lodging allowance, the meals allowance and the incidental expense allowance. Most of the CONUS (approximately 2600 counties) are covered by the standard CONUS per diem rate of $123 ($77 lodging, $46 meals and incidental expenses). In fiscal year (FY) 2012, there continue to be about 400 Non-Standard Areas (NSAs) that have per diem rates higher than the standard CONUS rate.
Since FY 2005, NSA rates have been based on Average Daily Rate (ADR) data from the lodging industry, which GSA obtains through a contract with a leading provider of lodging industry data. For more about how per diem rates are determined, visit Factors Influencing Lodging Rates. The ADR is a widely accepted lodging-industry measure based upon a property's room rental revenue divided by the number of rooms rented as reported by the hotel property to the contractor. This calculation provides us with the average rate that rooms rent in a given area.
As in previous years, GSA still uses:
- Only "fire safe" properties; GSA is required by law to use only properties that are certified as being in compliance with the Hotel & Motel Fire Safety Act of 1990.
- Properties that fall within the mid-price range. This range includes all properties from the lowest to the highest of the mid-price, upper and upper-upscale properties in an area;
- Data from the prior 12-month period. For FY 2012, this is from April 2010 through March 2011;
- Business travel week data (Monday through Thursday)
Agencies are reminded that the Federal Travel Regulation allows for actual expense reimbursement when per diem rates are insufficient to meet necessary expenses. Please see FTR §301-11.300 through 306 for more information.
FY 12 Results:
For FY 2012, ADR data indicate that the lodging industry has not returned to the ADR peaks realized prior to 2008. While some NSAs are showing signs of recovery, others have remained flat or continued to decrease below FY 2011 levels. Overall, the NSA rates are similar to FY 2011 as most rates did not increase or decrease more than $5. The six M&IE tiers will remain the same for FY 2012.
Factors Influencing Lodging Rates
Introduction
Historically, GSA has worked with federal agencies, travelers, and the travel industry to improve the process of establishing federal lodging per diem rates. Since fiscal year 2005, lodging per diem rates are based on average daily rate (ADR) data, which is a widely accepted lodging-industry measure based upon a property's room rental revenue divided by the number of rooms rented as reported by the hotel property to the contractor. The purpose of this page is to discuss three factors that influence the ADR that may result in the federal lodging per diem rates to differ from published market rates. These three factors are:
A. Property Selection Criteria
B. Time Frame of Data
C. Seasonality
It is important to note that each factor's impact varies by market. A detailed description of each factor follows:
A. Property Selection Criteria
Part of the GSA's per diem methodology for determining market rates involves collecting average daily rate (ADR) data from specific properties that meet the GSA criteria. The ADR is a widely accepted lodging-industry measure based upon a property's room rental revenue divided by the number of rooms rented as reported by the hotel property to our contractor, Smith Travel Research (STR). This calculation provides GSA with the average rate that rooms rent in a given area.
Our criteria includes geography (i.e., ZIP codes to which federal employees travel), fire-safe certification, and various property demographics. STR ranks properties into luxury, upper upscale, upscale, mid-scale, and economy categories. The goal of the selection criteria is to choose properties best representing mid-range hotels in each market.
B. Time Frame of Data
For the FY 12 per diem study, GSA used ADR data generated from April 2010 to March 2011. The ADR data is based on travel between Monday and Thursday.
C. Seasonality
To better represent seasonal rate fluctuations, GSA has created seasonal rate periods in many markets where there is a sustained period (two or more months in length) where rates (ADR) are different from the preceding or following period by at least 15%. If there is an ADR difference between 10 and 14% of a sustained period and the occupancy rate level for this same period is 70% or more, this period also becomes a season. Once a season has been defined, the ADR for all seasons is computed using the current lodging data ending in March. GSA uses the same properties for rates and seasonal determination; however, three years' worth of data is used to determine seasons.
Per Diem Mobile App
This app allows travelers to look up Federal government per diem rates by city/state and ZIP code in locations throughout the United States and its territories. Per diem is the daily allowance for lodging (excluding taxes), meals and incidental expenses. These rates are established by the General Services Administration for destinations in the lower 48 contiguous United States, and by the U.S. Department of Defense for locations in Alaska, Hawaii and the U.S. territories. The U.S. Department of State sets rates for foreign travel locations.
