Determining/Setting a server's time zone

Hi,

   How/Where does PostgreSQL set or determine the local time zone?

On my server, I am seeing (+00):

db=> SELECT now();
               now
-------------------------------
  2009-03-23 22:32:47.595491+00
(1 row)


But on my workstation I am seeing (-04):

db=> SELECT now();
               now
-------------------------------
  2009-03-23 18:16:36.591653-04
(1 row)

   The only thing I can think of is that my server is set to believe the
BIOS time is UTC and my workstation is set to EDT. Does PostgreSQL check
this from the host machine?

   For reference, my server is Debian Sarge (4.0) and my workstation is
Ubuntu 8.10.

Thanks!

Madi