Make Calls to Oppose Changes to Government Per Diem Rates
The General Services Administration (GSA) is proposing a change in the Per Diem rate calculation that would result in up to 30% lower Per Diem rates in major markets. The proposal is to drop the upper upscale hotel segment from the methodology used to calculate Per Diem rates for lodging.
The GSA calculates Per Diem rates to reflect the “midscale” market rate in 400 markets using rates from independent, midscale, upscale, and upper upscale hotels, including group rates and rates found on OTAs. Rates from the economy and luxury segments are excluded from the process, as they do not fit within the midscale range. The GSA further reduces the calculated rate by 5% to arrive at the Per Diem rate.
By dropping the upper upscale segment, the Per Diem rate will be artificially lowered, and many hotels will be pressured to accept reduced rates or lose business. Many private and public sector organizations use the GSA’s Per Diem rates to set travel reimbursement rates for employees; thus, the GSA’s proposal could have a huge impact on revenue not only from government travel but also from private sector business travel.
There are two ways you can help stop the GSA from manipulating per diems:
1. Visit the AH&LA’s grassroots website to contact your elected Congressional representatives at AH&LA Hotel Lobby. You can quickly send your legislators a short message with a prewritten letter than can be customized asking that they oppose per diem rate manipulation.
2. Contact the GSA office for your state.
GSA is divided into regions that are led by politically-appointed regional administrators and they are very strong voices within the agency. Those regional administrators are from the areas their regions cover and are extremely sensitive to issues impacting those within their regions.
When regional administrators are contacted about certain issues, they communicate those concerns internally. GSA headquarters needs to hear from every regional administrator that there is strong opposition to this proposed change in per diem methodology. Find talking points and a list of offices here.