3R Relocation Incentives: Moving on the Government’s Dime

Sometimes, it’s difficult for the federal government to fill an open position, either because the skill set is hard to find or because the job location is less than ideal. When this happens, the feds can look to their current employees and offer relocation incentives to help attract the best candidates to fill these positions.

What are they?

Relocation incentives are paid to current government employees who meet certain criteria and who will be moving to a different geographic location to take a position that would otherwise be difficult to fill in the absence of such an incentive. The new job site must be more than 50 miles from where the employee currently works (this requirement can be waived if necessary). Relocation incentives are only paid out when the move is made at the request of the government, and not for the employee’s convenience.

Who is qualified?

Those qualified to receive a relocation incentive include current employees appointed to GS, senior-level, scientific or professional, SES, FBI or DEA SES, Executive Schedule, law enforcement officer, and prevailing rate positions. Agencies can make a written request to OPM to give a relocation incentive to a non-covered position.

Those who are non-career SES Presidential appointees, non-career SES appointees, are excepted from competitive service for a specific reason, currently serve as or will soon serve as an agency head, and SES limited term or emergency appointees that muse be cleared through the White House are not able to receive a relocation incentive.

If the employee is in one of the covered positions, he or she must have been rated “Fully Successful” or the equivalent during the last performance appraisal period. Agencies are also permitted to offer relocation incentives to groups of employees who, for example, might all be transferring to a new duty station.

How much can someone receive?

An eligible employee can receive up to 25% of the annual rate of basic pay when the employee enters into the service agreement under which the relocation incentive will be paid times the number of years in the service agreement. OPM can authorize payments up to 50% of this amount, so long as the amount does not exceed 100% of the employee’s first year of basic pay under the service agreement.

Incentives are traditionally paid out as a lump sum at the beginning or conclusion of the service period, or in installments throughout the period. The incentive will not be paid until an employee establishes residency in the new area. Residency can be established in a variety of ways including purchasing or renting a house, or apartment; residing with friends or family; temporarily living in a hotel; etc.

What is required of the employee and agency?

An employee must establish residency (through an approved method). The employee is not required to sell his or her current home or move his or her family to the new location. The employee is permitted to live at the new location during the work week, and then live with his or her family in another geographic area on weekends. Throughout the service period, the employee must maintain a residence in the new geographic location, and may be asked to provide proof of residency, such as a utility bill.

An agency must receive approval prior to authorizing the payment of a relocation incentive (and authorization must be gained before the employee enters service in the new position). To gain approval, the agency must provide, in writing, information on why the position was determined to be difficult to fill in the absence of such an incentive, how much will be paid and when, the terms of the service agreement and service period, and proof that the new location is in a different geographic area than where the employee currently resides.

Once the agency receives the requisite approval, the employee must sign a service agreement. This agreement will include the service period (of no more than four years), the specific start and end dates, how much will be paid for relocation, when the incentive will be paid, and what happens if an employee is terminated prior to the end of the service agreement.


What happens if I’m fired or reassigned?

At its discretion, the agency has the authority to terminate your incentive, in which case you are entitled to keep and/or receive any relocation incentive payments for the period of service you have already completed. You may also retain any amount you have already been paid for uncompleted service (i.e. if you received your relocation incentive up front). If you are terminated for cause or fail to maintain residence, you may retain any portion of the relocation incentive for service already completed, however, you must repay any portion of the incentive you have received for service not yet completed. 

How often are these incentives used?

In calendar year 2009, the last year for which OPM released data, 45 federal agencies paid 4,605 relocation incentives totaling more than $55 million. The average payment was $12,000. The Department of Defense made up nearly 75% of this total, paying out nearly 3,400 relocation incentives totaling more than $36 million.


Are there other benefits offered by my agency if I relocate?

Additional incentives vary by agency, so be sure to verify with your HR department what you are eligible to receive. Relocation assistance can include packing, moving, and storing your household goods (up to a certain weight) or it might simply be a reimbursement for your moving costs, so be sure to keep your receipts! Some agencies offer counseling assistance prior to the move to help you learn about school districts, renting or buying, amenities in the area in which you’ll be living, etc. Some agencies pay for transportation for your family and vehicles to the new location. Others will cover your expenses if you need to travel to the new location to complete house hunting activities. And, if you are a current homeowner, you might be offered assistance in listing your home for sale.

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Ladonna Bowen

Last year, I applied for a job that offered relocation which also included a benefit under the Defense National Relocation Program (DNRP) when I relocated from Germany back to the US (to State#2) to a different state(State1#) before going to Germany 4 years earlier. It was determined that I was completely eligible/qualified for this program (which was announced in the job posting as well), where the US government would facilitate sale/purchase of primary residence in (State#1). This was a huge incentive and actual the deciding factor along with the fact that my husband would be able to transfer (NAF employee) or participate in the priority placement program, (as we would be looking at a $30k+ loss in pay).
On the day we shipped our vehicle and moved into lodging on post, set to return to the US in just a day or two, I received an email stating that the position was posted as a “Centrally managed position” in error and therefore new orders will have to be issued to rescind the DNRP benefit.

What a nightmare! oh, and the guarantee that my spouse would be able to transfer and receive a level of priority, well, also bad information. Turns out, we were told that that only counts Air Force to Air Force and that since we we Army employees overseas, that he would have to compete and could not transfer.

I eventually, sold the house via Short Sale, which comes with other issues (which affect future home buying! Security Clearance, etc., etc, ) and my husband eventually found a job here he likes, however it has left a bad taste on the pallet and has us seeking employment outside the Government.
I strongly urge that any offer of Relocation Incentives be weighed heavily.