Late last week, the Washington, D.C.-based General Services Administration, the arm of the federal government responsible for setting travel policy and regulations, released the much anticipated 2014 federal travel per diem rates. After last year's contentious standoff between hoteliers and the agency, which sought to reduce 2013 rates drastically and ultimately resulted in the GSA freezing 2012 rates until a solution could be reached, the new rates should have hoteliers across the country heaving a collective sigh.
While the new lodging rates increased an average of 1.9 percent, many cities, like San Francisco, saw much bigger gains. A few, like Washington, D.C., actually saw their rates drop. Even more significant, however, the GSA said it is doing away with a long-established policy that allowed federal employees to spend up to 25 percent above per diem rates for conferences. It is a move, the agency said, designed to implement stricter controls and reduce travel costs. Considering the scandals that enveloped the GSA and IRS over their conference spend, it should come as no surprise. The agency estimates that the elimination of the 25 percent policy will result in savings of $10 million in fiscal year 2014.
In an Aug. 30 blog post on the GSA's website, Ann Rung, associate administrator of government-wide policy, stated, "In recent years, the administration has taken aggressive steps to cut travel and conference spending. We have implemented strict policies and controls to ensure that all travel and conference expenditures are cost-effective and advancing the goals of federal agencies." In addition, she pointed out that the GSA's cost-cutting measures had resulted in a $2 billion reduction in travel spend since 2010, including $28 million in 2012. "As each agency reviews its travel and conference-related activities, each agency must ensure that any spending serves the American people as efficiently and effectively as possible," she wrote.
Despite the increase in lodging rates, the 2014 per diem rates, which take effect Oct. 1, are still, on average, 5 percent below the average daily market rate, which is based on several factors including market costs. The following chart highlights the 2014 per diem rate change for 10 major conference cities over 2013 rates. A complete chart of the 2014 per diem rates can be found at gsa.gov. 