Reimbursement rates for lodging, meals and incidental expenses for fiscal year 2013, which begins Oct. 1, will be frozen at the FY 2012 levels, the U.S. General Services Administration announced Aug. 27. GSA is the arm of the federal government that sets travel policy for federal employees.

The reimbursement rates, commonly called per diems, determine the amount a federal employee can be reimbursed for expenses incurred while traveling on government business. Private-sector employers commonly use the rates too, because:

1. doing so simplifies tax returns;
2. the rates are set for hundreds of locations and account for variations in price between locations;
3. the rates above the reimbursement threshold are taxed; and
4. the rates constitute a safe harbor of sorts -- government and private-sector clients are unlikely to challenge the per diem rates (even if they question the necessity of the travel itself) when such costs are passed on to customers.

An Aug. 22 GSA press release said the action was intended to help federal agencies save an estimated $20 million in avoided costs in FY 2013, in line with President Obama’s campaign to cut waste. GSA announced the freeze in Per Diem Bulletin FTR 13-01. GSA’s Office of Governmentwide Policy sets the per diem travel reimbursement rates, adjusted for inflation, each fiscal year. This year is the first in a decade that GSA has frozen travel reimbursement rates.

“While we considered a number of proposals to drive savings through the GSA per diem lodging rates, we needed more time to undertake a comprehensive review of the methodology used to determine those rates,” the GSA release stated.

Standard per diems, which apply to all locations within the continental United States that are not specifically listed as “non-standard areas,” remain unchanged at $77 per day for lodging and $46 daily for M&IE. Currently about 400 areas are considered NSAs. GSA added 10 more NSAs for FY 2013, all of which are listed in FTR 13-01. The per diem rates for all 400 NSAs in the continental United States are listed on the GSA’s website and can be downloaded as an Excel spreadsheet file.